The Consumer Financial Protection Bureau is weighing how much legal protection banks should have from homeowner lawsuits as it prepares to release a "qualified mortgage" rule, required by the Dodd-Frank Act. The agency says it's on track to release a proposal by the Jan. 21 deadline. Banks say they want a broad definition of qualified mortgages and that without strong legal protections, they will cut back on lending. Consumer groups contend the banks are overstating their risks.
Jay DesMarteau, head of small-business and government banking at TD Bank, provides tips to small businesses about how they can be more successful in obtaining loans from banks. For example, he says that banks want to see a business plan and that "the most important thing to us is the strength of the business's cash flow."
The Consumer Financial Protection Bureau published a guide for how its examiners will ensure that private student lenders comply with federal consumer financial laws. Examiners will evaluate marketing and advertising materials, disclosures, periodic borrower statements and lenders' systems for tracking and handling consumer inquiries.
The Office of the Comptroller of the Currency is concerned about smaller banks taking on more risk to deal with decreasing profit and expensive compliance costs, writes Orlando Hanselman, Fiserv's education programs director. "[W]e are seeing banks assume greater risk on the strategic side, by entering unfamiliar product territory, and on the cost side, by devoting fewer resources for risk management," he writes. "These risks must be properly understood and managed."
The Department of Justice is requiring First Niagara Financial Group to sell 26 HSBC Bank branches in order to close a $1 billion acquisition of almost 200 of the bank's branches. The buyers of those 26 branches might be known within 30 days, according to a First Niagara representative.