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The OCC, Federal Reserve, FDIC and NCUA have issued an interagency "Frequently Asked Questions on the New Accounting Standard on Financial Instruments – Credit Losses" to assist financial institutions and examiners with the new accounting standard, Accounting Standards Update 2016-13, Topic 326, “Financial Instruments – Credit Losses,” issued by the Financial Accounting Standards Board (FASB) on June 16, 2016. The FAQs:

• summarize key elements of the new accounting standard, focusing on such concepts as effective dates, scope, transition and measurement approaches;
• highlight areas within existing U.S. generally accepted accounting principles that will change with the new accounting standard;
• discuss initial supervisory views with respect to measurement methods, portfolio segmentation, use of vendors, scalability, data needs, and allowance processes; and
• outline certain steps that financial institutions are encouraged to take to prepare for the transition to the new accounting standard.

• OCC Bulletin 2016-45
• FDIC FIL-79-2016
• Federal Reserve Board SR 16-19

Related stories:

• FASB issues new guidance on credit losses accounting - June 16, 2016
• Agencies' statement on new accounting standard - June 20, 2016

The Federal Emergency Management Agency has published a final rule in this morning's Federal Register identifying communities in Brazoria, Chambers, Fort Bend, Galveston, Harris, and Montgomery Counties, Texas, that are scheduled for suspension from the National Flood Insurance Program (NFIP) on January 6, 2017, for noncompliance with the floodplain management requirements of the program.

The CFPB has posted a Bureau Blog article announcing the key areas on which its fair lending team will focus in 2017:

• Redlining. It will continue to evaluate whether lenders have intentionally avoided lending in minority neighborhoods.
• Mortgage and Student Loan Servicing. It will determine whether some borrowers who are behind on their mortgage or student loan payments may have more difficulty working out a new solution with the servicer because of their race or ethnicity.
• Small Business Lending. Congress expressed concern that women-owned and minority-owned businesses may experience discrimination when they apply for credit, and has required the CFPB to take steps to ensure their fair access to credit.

The CFPB has announced it issued a consent order against Moneytree, Inc., a financial services company headquartered in Seattle, Washington, that offers payday loans and check-cashing services, for misleading consumers with deceptive online advertisements and collections letters. The company also made unauthorized electronic transfers from consumers’ bank accounts. The CFPB has ordered the company to cease its illegal conduct, provide $255,000 in refunds to consumers, and pay a civil penalty of $250,000. See "CFPB trims Moneytree" in our Penalty pages for more information on this enforcement action.

The FFIEC has posted Version 2017 for CY 2016 data due March 1, 2018. Each software version is year-specific (i.e., 2016 reporting requires 2016 DES and not 2017 DES).

The Federal Reserve Board has released the household debt service and financial obligations ratios for third quarter 2016.

The HUD and the Census Bureau have jointly announced the new residential construction statistics for November 2016:

• Privately owned housing units authorized by building permits in November were at a seasonally adjusted annual rate of 1,201,000, 4.7 percent below the revised October rate and 6.6 percent below the November 2015 estimate. Single-family authorizations in November were at a rate of 778,000, 0.5 percent above the revised October figure. Authorizations of units in buildings with five units or more were at a rate of 384,000 in November.
• Privately owned housing starts in November were at a seasonally adjusted annual rate of 1,090,000, 18.7 percent below the revised October estimate, but 6.9 percent below the November 2015 rate. Single-family housing starts in November were at a rate of 828,000; 4.1 percent below the revised October figure. The November rate for units in buildings with five units or more was 259,000.
• Privately owned housing completions in November were at a seasonally adjusted annual rate of 1,216,000, 15.4 percent above the revised October estimate and 25.0 percent above the November 2015 rate. Single-family housing completions in November were at a rate of 774,000; 3.3 percent above the revised October rate The November rate for units in buildings with five units or more was 432,000.

The FHFA has released the 2017 Scorecard outlining specific conservatorship priorities for Fannie Mae, Freddie Mac, and their joint venture, Common Securitization Solutions, LLC. The 2017 Scorecard furthers the goals outlined in FHFA’s Strategic Plan for the Conservatorships of Fannie Mae and Freddie Mac, published in May 2014.

Director Cordray presented prepared remarks yesterday to the participants at the CFPB Research Conference. The Director observed, “in the last two generations, the markets for consumer credit and household finance have expanded and become much more complex. Raw numbers tell the story. The mortgage market today stands at just over $10 trillion. Student loan debt has risen rapidly in recent years to over $1.3 trillion. Auto loan debt exceeds $1.1 trillion. And credit card debt now totals around $700 billion. Growing along with this debt has been the availability, variety, and complexity of consumer financial products and services “ He also noted, “We are also the first federal agency with jurisdiction over both banks and the nonbank financial companies that compete against them in markets like mortgage origination, mortgage servicing, auto finance, consumer installment lending, and the like. Just as an umpire must be authorized to assess the entire field of play, this authority enables us to level the expectations and compliance standards of these two types of financial services providers.”

Cordray also announced the unveiling of a new Consumer Credit Trends web tool, which offers a fresh and timely perspective on the performance of consumer financial markets both today and over time. The beta version of the Consumer Credit Trends tool tracks originations for mortgages, credit cards, auto loans, and student loans.

The NCUA Board has announced it unanimously approved three items at its December 15, 2016, meeting:

• A final rule providing regulatory relief to federal credit unions by eliminating the full occupancy requirement in the current occupancy rule;
• An interim final rule amending the agency’s Freedom of Information Act (FOIA) regulation to provide greater agency transparency and to comply with changes in federal law; and
• A request from the Texas Credit Union Department to revise its member business lending rule to provide parity with NCUA’s rule.