The outgoing president of the Federal Reserve Bank of Kansas City turned some heads this week when he declared that the nation’s largest banks and recipients of federal bailout funds should be re-branded as government-sponsored enterprises and their lending activities should be curtailed accordingly. Thomas Hoenig reportedly told...

Federal Financial Institutions Examination Council. Revised Interagency Exam Procedures for Regulation Z (TILA). Notwithstanding court petitions seeking to stop the implementation of a new loan originator compensation rule, the Federal Reserve Board announced revised examination procedures that will ensure...

The Federal Reserve Board’s loan originator compensation rule is finally in effect after lawsuits filed by mortgage broker trade groups failed to stop the rule in its tracks. In a terse, one-page decision, the U.S. District Court of Appeals for the District of Columbia Circuit lifted a temporary stay order against...

Illinois. The Division of Banking has been receiving inquiries regarding a number of mortgage companies that are still in the process of renewing their Illinois residential mortgage licenses for calendar year 2011 through the Nationwide Mortgage Licensing System and Registry. The issue is that...

A conflict of interest exists if an employee of a federal credit union disapproves member loans and then refers them to a mortgage banker that pays for such referrals, according to the National Credit Union Administration. Not only would there be a potential violation of the NCUA’s lending policy but the referral arrangements may also violate...

Federally regulated banks and credit unions favor Republican-backed legislation that would install a commission, instead of a single director, to call the shots at the Consumer Financial Protection Bureau. The majority of witnesses at a recent hearing called by the House Financial Services Subcommittee on Financial Institutions and Consumer Credit expressed their support for...

Mortgage lenders and compliance experts are deeply concerned about the recently published risk-retention proposal and its impact on the availability of credit for eligible borrowers as well as the potential fair lending issues it may raise. Industry trade groups are especially worried about...

A number of firms are actively testing their jumbo securitization operations, according to Clayton Holdings. Notably, jumbo conduits are anticipating new mortgage-backed security issuance. “We have recently participated in several meetings centered around newly-developed jumbo conduit platforms and have performed...

Risk-retention requirements proposed by federal regulators last week strongly favor the government-sponsored enterprises over non-agency securitization, according to industry analysts. The pristine mortgages in Redwood Trust’s recent jumbo securitization would not completely meet the standards and the vast majority of... [Includes one graph]

Real-estate investment trusts that focus on the nonconforming market are positioned to capitalize on risk-retention requirements proposed last week by federal regulators. But banks with large balance sheets may be less able to access non-agency securitization, according to industry analysts. The qualified residential mortgage proposal is likely to...