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How to add predictive analytics into your risk program. Risk reports are often limited to historical insights and issues and do not provide guidance and insights into the future of the organization. Adding predictive analytics can allow your organization to detect emerging risks and create mitigation plans. This can be achieved by combining internal and external key risk indicators (KRIs) and key performance indicators (KPIs) with regulatory intelligence. This ensures that risk reports can detect more issues and highlight areas of concern. Click here to learn more.


Top Story Lending Related

10/03/2019

Fed CRA evaluations for September

A review of the Federal Reserve Board's Community Reinvestment Act search page shows that the Board made public 21 evaluation ratings in September. Our congratulations to Bank of Clarke County, Berryville, Virginia, with a CRA Evaluation that received a rating of "Outstanding." The other 20 banks received "Satisfactory" ratings.

10/02/2019

2020 OCC bank supervision operating plan

The OCC has released its bank supervision operating plan for fiscal year 2020. Supervisory strategies will focus on—

  • cybersecurity and operational resiliency
  • BSA/AML compliance management
  • commercial and retail credit underwriting practices and oversight and control functions
  • impact of changing interest rate outlooks on bank activities and risk exposures
  • preparedness for the current expected credit losses (CECL) account standard, and preparation for the potential phase-out of LIBOR
  • technological innovation and implementation

10/02/2019

CFPB and SC sue high rate loan brokers

The CFPB announced Tuesday that the Bureau and the South Carolina Department of Consumer Affairs have filed a lawsuit in federal district court in the District of South Carolina against Katharine Snyder, Performance Arbitrage Company, Inc., and Life Funding Options, Inc. The companies, owned and operated by Snyder, brokered contracts offering high-interest credit to veterans, many of whom are disabled, and to other consumers. The Bureau alleges that the companies and their owner violated the Consumer Financial Protection Act’s prohibition against deceptive acts or practices.The Bureau and South Carolina allege that Snyder and her companies—

  • misrepresented to consumers that the contracts the companies broker are valid and enforceable when, in fact, the contracts are void under federal and state law;
  • misrepresented to consumers that the product is a sale of payments and not a high-interest credit offer; and
  • failed to inform consumers of the products’ interest rates.

The complaint seeks an injunction against Snyder and her companies, redress to consumers, and the imposition of a civil money penalty.

10/01/2019

OCC reports slight improvement in mortgage performance

The OCC has releaased its Mortgage Metrics Report, Second Quarter 2019. It shows 96.1 percent of mortgages included in the report were current and performing at the end of the quarter, compared to 95.6 percent a year earlier. It also showed that servicers initiated 21,409 new foreclosures during the second quarter of 2019­, a 22.5 percent decrease from the previous quarter and a 27.7 percent decrease from a year ago. Servicers completed 15,683 mortgage modifications in the second quarter of 2019, and 71.7 percent of the modifications reduced borrowers’ monthly payments.

10/01/2019

NMLS Ombudsman meeting summary available

The NMLS has made available a summary of the NMLS Ombudsman meeting held during the 2019 AARMR Annual Regulatory Conference.

10/01/2019

Fannie and Freddie PSPAs modified

Treasury and the FHFA have announced that they have agreed to modifications to the Preferred Stock Purchase Agreements (PSPAs) that will permit Fannie Mae and Freddie Mac to retain additional earnings in excess of the $3 billion capital reserves currently permitted by their PSPAs. Fannie Mae and Freddie Mac will be permitted to maintain capital reserves of $25 billion and $20 billion, respectively.

10/01/2019

Venezuela-related General Licenses amended

10/01/2019

NCUA issues rules for PALs II

The NCUA Board published [84 FR 51942] a final rule (referred to as the PALs II rule) to allow federal credit unions to offer additional payday alternative loans (PALs) to their members. The final rule does not replace the NCUA's current PALs rule (referred to as the PALs I rule). Rather, the PALs II rule grants FCUs additional flexibility to offer their members meaningful alternatives to traditional payday loans while maintaining many of the key structural safeguards of the PALs I rule. The PALs II rule will be effective December 2, 2019.

09/30/2019

FDIC August enforcement actions

The FDIC has released a list of administrative enforcement actions taken against banks and individuals in August (and one issued in July).

  • A Burnet, Texas, bank was ordered to pay $21,700 for a pattern or practice of flood insurance-related violations
  • A former chief financial officer of The Bank of Oswego, Lake Oswego, Oregon, was issued an adjudicated order to pay a civil money penalty of $175,000 and an order of prohibition for having approved the use of $675,000 in bank funds to pay for a customer's wire transfer and facilitating a $1.7 million loan to cover the transfer, aiding an abetting an improper straw buyer transaction involving bank-foreclosed property and failing to protect the bank's collateral position ion that property, following repeated appeals and delays caused by the former banker
  • The former president and CEO of AztecAmerica Bank, Berwyn, Illinois, consented to an order to cease and desist and and order to pay a civil money penalty of $25,000, for causing the bank to inject money into its holding company by approving payments by the bank to two of its employees for the purpose of enabling them to purchase stock in the holding company, resulting in a loss to the bank.
  • The former chief financial officer of Crown Bank, Edina Minnesota, was issued an order to cease and desist and an order to pay a $10,000 civil money penalty for assisting the former CEO of the bank in conducting and obscuring transactions in violation of Regulation O, and failing to stop or report the CEO's theft of funds from a third party's bank deposit account.
  • The former president and cashier of Commercial Bank of Oak Grove, Oak Grove, Missouri, was issued an adjudicated order to cease and desist and to pay a $15,000 civil money penalty for altering account statements of the bank's correspondent account at another bank, overstating the balance in that account, resulting in losses exceeding $500,000.

09/30/2019

Agencies raise residential appraisal threshold

The Federal Reserve Board, FDIC, and OCC issued a joint press release on Friday, announcing the adoption of a final rule that increases the threshold for residential real estate transactions requiring an appraisal from $250,000 to $400,000. For transactions exempted from the appraisal requirement, the final rule requires institutions to obtain an evaluation to provide an estimate of the market value of real estate collateral. Evaluations are generally less burdensome than appraisals and have been required since the 1990s. The rule will be effective the day following publication in the Federal Register.

The final rule incorporates the appraisal exemption for rural residential properties provided by the Economic Growth, Regulatory Relief, and Consumer Protection Act and similarly requires evaluations for these transactions. It also includes a requirement that institutions to review appraisals for compliance with the Uniform Standards of Professional Appraisal Practice. These two provisions of the final rule will be effective January 1, 2020.

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