Top Story Lending Related

U.S. and UK participants held the inaugural meeting of the U.S.-UK Financial Regulatory Working Group on September 12 in London. The Working Group was formed to deepen bilateral regulatory cooperation with a view to the further promotion of financial stability; investor protection; fair, orderly, and efficient markets; and capital formation in both jurisdictions.

Participants discussed the outlook for financial regulatory reforms and future priorities, including possible areas for deeper regulatory cooperation to facilitate further financial services activity between U.S. and UK markets. They also discussed the implications of the UK’s exit from the EU on financial stability and cross-border financial regulation, including a particular concern about contract continuity including servicing existing financial contracts after exit, noting the importance of reducing potential cliff-edge risks for business and consumers. Participants also discussed the U.S.-UK financial regulatory issues resulting from the UK’s exit from the EU, and recognized the importance of maintaining bilateral activity of U.S. and UK financial services firms.

The Federal Emergency Management Agency has published [83 FR 47077] in today's Federal Register a final rule identifying communities in Oregon, South Carolina and Wisconsin where the sale of flood insurance has been authorized under the National Flood Insurance Program (NFIP) that are scheduled for suspension on September 28, 2018, for noncompliance with the floodplain management requirements of the program:

• OR: Bay City, Garibaldi, Manzanita, Nahalem, Rockaway Beach, Tillamook, Wheeler, and unincorporated areas of Tillamook County
• SC: Camden, Sumter, and unincorporated areas of Kershaw, Lancaster, and Sumter counties
• WI: Rothchild, Wausau, and Weston, and unincorporated areas of Marathon County

A joint press release was issued on Friday by the OCC, FRB, FDIC, NCUA, and the Conference of State Bank Supervisors which stated they recognize the serious impact of Hurricane Florence on the customers, members, and operations of many financial institutions and will provide appropriate regulatory assistance to affected institutions subject to their supervision. The agencies encourage institutions operating in the affected areas to meet the financial services needs of their communities. The FDIC also issued FIL-48-2018 on the topic.

OFAC has announced it has posted two new Frequently Asked Questions (FAQs) to provide guidance on ”maintenance” as that term is used in General Licenses 14 , 15, and 16.

The NCUA Board has published [83 FR 46973] a notice of its next open meeting, at 10:00 a.m., Thursday, September 20, 2018. Matters for consideration include the Share Insurance Fund quarterly report, a board briefing on appointment of administrative law judges, NCUA rules on real estate appraisals, and the Texas Member Business Loan rule. A closed meeting will follow.

The Bureau of Consumer Financial Protection announced it has filed a complaint against Future Income Payments, LLC (FIP), Scott Kohn, and several related entities. The complaint alleges that the defendants violated the Consumer Financial Protection Act by representing to consumers that their pension-advance products were not loans, were not subject to interest rates, and were comparable in cost to, or cheaper than, credit card debt when, in actuality, the pension-advance products were loans, and were subject to interest rates that were substantially higher than credit card interest rates. The Bureau also alleges that the defendants violated the Truth in Lending Act (TILA), by failing to disclose a measure of the cost of credit, expressed as a yearly rate.

The OCC will host two workshops at the Holiday Inn San Francisco-Golden Gateway, San Francisco, California, November 6–7, for directors of national community banks and federal savings associations.

• The Credit Risk workshop on November 6 focuses on credit risk within the loan portfolio, such as identifying trends and recognizing problems. The workshop also covers the roles of the board and management, how to stay informed of changes in credit risk, and how to effect change.
• The Operational Risk workshop on November 7 focuses on the key components of operational risk—people, processes, and systems. The workshop also covers governance, third-party risk, vendor management, and cybersecurity.

The Bureau of Consumer Financial Protection announced yesterday an interim final rule updating two model disclosures in Appendices I and K of Regulation V to reflect changes made to the Fair Credit Reporting Act by the EGRRCPA. The two disclosures—the Summary of Consumer Rights and the Summary of Consumer Identity Theft Rights—reflect the EGRRCPA amendments to the FCRA that requires nationwide consumer reporting agencies to provide free "national security freezes," and extend from 90 days to one year the minimum time that nationwide consumer reporting agencies must include an initial fraud alert in a consumer's file. The interim final rule also permits various compliance alternatives. It becomes effective as required by the EGRRCPA on September 21, 2018.

OCC Bulletin 2018-28 announces an update of the “Deposit-Related Credit” booklet of the Comptroller’s Handbook. The update:

• provides general guidance on the risks associated with deposit-related credit products, such as check credit, overdraft protection, and deposit advance products
• includes updates due to the rescission of OCC Bulletin 2013-40, “Deposit Advance Products: Final Supervisory Guidance,” and the issuance of OCC Bulletin 2018-14, “Installment Lending: Core Lending Principles for Short-Term, Small-Dollar Installment Lending”
• provides information regarding the Military Lending Act as implemented by the U.S. Department of Defense’s 32 CFR 232.
• incorporates references for OCC Bulletin 2017-21, “Third-Party Relationships: Frequently Asked Questions to Supplement OCC Bulletin 2013-29,” and OCC Bulletin 2017-43, “New, Modified, or Expanded Bank Products and Services: Risk Management Principles.”
• incorporates the prohibition in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 against unfair, deceptive, or abusive acts or practices.

The Federal Reserve Board has released the September 12, 2018, issue of the Beige Book.