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Banker's Toolbox, Inc., leaders in compliance solutions for financial institutions, announced the acquisition of Georgia-based MainStreet Technologies (MST). MST is an industry leader in the loan risk management space. This acquisition adds to a strong and growing portfolio of compliance-related solutions and will continue to enhance the value Banker's Toolbox brings to both their customers and the industry. (Read full press release here.)

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Storm and flood relief FILs issued

The FDIC has issued Financial Institution Letters announcing steps intended to provide regulatory relief to financial institutions and facilitate recovery in areas of Arkansas (FIL-32-2019) and South Dakota (FIL-33-2019) affected by severe weather.


Distressed or underserved geographies under CRA

The Federal Reserve, FDIC, and OCC have issued a joint press release announcing the availability of the 2019 list of distressed or underserved nonmetropolitan middle-income geographies where revitalization or stabilization activities are eligible to receive Community Reinvestment Act (CRA) consideration under the community development definition. The historical list of these geographies is available on the FFIEC's Distressed and Underserved Tracts page.


Fannie and Freddie NPL sales

The FHFA has released its Enterprise Non-Performing Loan Sales Report, which provides information about the sale of NPLs by Fannie Mae and Freddie Mac. The report includes information about NPLs sold through December 31, 2018, and reflects borrower outcomes as of December 31, 2018, on NPLs sold through June 30, 2018. The sale of NPLs reduces the number of delinquent loans in the Enterprises’ portfolios and transfers credit risk to the private sector. FHFA and the Enterprises impose specific guidelines on NPL buyers designed to achieve more favorable outcomes for borrowers than foreclosure


FEMA suspending communities in 5 states Thursday

FEMA has published [84 FR 27970] a rule identifying communities in five states hat are scheduled for suspension from the National Flood Insurance Program on Thursday, June 20, for noncompliance with the floodplain management requirements of the program.

  • Pennsylvania: In Perry County, the Boroughs of Blain, Duncannon, and Liverpool; and Townships of Greenwood, Juniata, Miller, Northeast Madison, Penn, Rye, Southwest Madison, Spring, Toboyne, Watts, and Wheatfield
  • South Carolina: Unincorporated areas of Greenwood, Laurens, and Newberry Counties
  • Kansas: In Montogomery County, the Cities of Caney, Cherryvale, Coffeyville, Elk City, and Independence; and unincorporated areas
  • Missouri: Unincorporated areas of Jefferson County
  • Washington: in Mason County, the City of Shelton and unincorporated areas.

If FEMA receives documentation that a listed community has adopted the required floodplain management measures before June 20, its suspension will not occur. Information identifying the current participation status of a community can be obtained from FEMA's Community Status Book.


CFPB settles with student loan firm

The Bureau has announced a settlement with Student CU Connect CUSO, LLC (CUSO), a company set up to hold and manage private loans for students at ITT Technical Institute. The complaint filed by the CFPB alleged that CUSO was actively involved in the creation and the implementation of the CUSO loan program. The complaint alleges that ITT induced its students to take out the loans by a variety of means, and that CUSO knew or was reckless in not knowing that many student borrowers did not understand the terms and conditions of the CUSO loans and could not afford them.

Under the terms of a proposed stipulated judgment, CUSO must stop collecting on all outstanding CUSO loans, discharge all outstanding CUSO loans, and ask all consumer reporting agencies to which CUSO furnished information to delete tradelines relating to CUSO loans. The order also requires CUSO to provide notice to all consumers with outstanding CUSO loans that their debt has been discharged and is no longer owed and that CUSO is seeking to have the relevant tradelines deleted. The total amount of loan forgiveness is currently estimated to be $168 million. Forty-four states plus the District of Columbia have also settled with CUSO on the same terms.


OCC schedules two workshops in Boston

Two compliance and operational risk workshops will be hosted by the OCC at its Boston Field Office, on July 30 and 31, for directors of national community banks and federal savings associations it supervises.

  • The Compliance Risk workshop on July 30 focuses on the critical elements of an effective compliance risk management program and on major compliance risks and critical regulations. Topics of discussion include the Bank Secrecy Act, Flood Disaster Protection Act, Fair Lending, Home Mortgage Disclosure Act, Community Reinvestment Act, and other compliance hot topics.
  • The Operational Risk workshop on July 31 focuses on the key components of operational risk—people, processes, and systems. The workshop also covers governance, third-party risk, vendor management, internal fraud, and cybersecurity.


FDIC Supervisory Highlights

The June 2019 issue of the FDIC's Consumer Compliance Supervisory Highlights includes a section with "Resources & Information for Financial Institutions" and an appendix of "Most Frequently Cited Violations and Enforcement Actions" to support supervised institutions' efforts to manage consumer compliance responsibilities effectively. In a section devoted to issues identified in examinations during 2018, the report lists:

  • Overdraft Programs: Debit Card Holds and Transaction Processing
  • Real Estate Settlement Procedures Act (RESPA) Section 8 Violations
  • Regulation E – Mistakes Made in the Consumer Liability/Error Resolution Process
  • Skip-A-Payment Loan Programs
  • Lines of Credit – Finance Charge Calculation and Disclosure


CRA feedback from 29 Fed roundtables

The Federal Reserve Board has published "Perspectives from Main Street: Stakeholder Feedback on Modernizing the Community Reinvestment Act," a summary of feedback received from bankers and community groups during a series of 29 roundtable discussions on the current state of, and potential revisions to, Community Reinvestment Act regulations.


McWilliams addresses CATO Summit attendees

In remarks at the CATO Summit on Financial Regulation: “If You Build It, They Will Come” in Washington, D.C., FDIC Chairman McWilliams discussed:

  • The regulatory framework and innovation
  • Benefits of innovation
  • Benefits of banking
  • The FDIC and innovation
  • Small-dollar lending
  • Reducing regulatory burden
  • De novo banks


FHFA report to Congress

The Federal Housing Finance Agency has released its 2018 Report to Congress, which provides information about FHFA's 2018 examinations of Fannie Mae and Freddie Mac, 11 Federal Home Loan Banks and the Federal Home Loan Banks' Office of Finance. The report also describes FHFA's actions as conservator of the Enterprises and presents two legislative recommendations:

  • Acting on housing finance reform
  • Strengthening the FHFA's regulatory powers


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