CFPB Makes Annual Threshold Adjustments Per HMDA, TILA Regulations. Late last month, the CFPB issued two final rules regarding annual threshold adjustments under the implementing regulations for the Home Mortgage Disclosure Act and the Truth in Lending Act. Under the HMDA regulation, Reg. C, the asset-size exemption for banks, savings associations and credit unions will remain at $44 million. As a result, such institutions with assets of $44 million or less as of Dec. 31, 2015, are exempt from collecting HMDA data in 2016. “An institution’s exemption from collecting data in 2016 does not affect its responsibility to report the data it was required to collect in 2015,” the CFPB said. The rule became effective Jan. 1, 2016, and applies ...

In addition to misrepresenting prices sought by buyers and sellers of MBS, the DOJ said Siegel and co-conspirators misrepresented that bonds held in RBS’s inventory were being offered for sale by a fictitious third-party seller…

Specifically, the bureau’s notice asks for public comment on the agency’s use of resubmission error thresholds and how they should be calculated.

The Department of Justice announced in December that a structured finance supervisor at RBS Securities pleaded guilty to participating in a multi-million dollar securities fraud scheme and is cooperating with the government’s ongoing investigation. Adam Siegel was co-head of U.S. ABS, MBS and commercial MBS trading at RBS between 2008 and 2014. The U.S. Attorney’s Office in the District of Connecticut said Siegel admitted that he and others conspired to increase RBS’s profits on trades of residential MBS and collateralized loan obligations at the expense of customers. “His crime included...

Exams by the Securities and Exchange Commission in 2015 uncovered a number of problems at rating services large and small, according to a report released by the SEC at the end of December. However, the firms weren’t identified by name because the exams aren’t public. The report is a laundry list of findings involving the 10 nationally recognized statistical rating organizations, six of which are involved in the MBS and ABS markets. The findings came from exams that focused on activities in 2014. Offending rating services generally were referred to solely based on their size, with Fitch Ratings, Moody’s Investors Service and Standard & Poor’s referred to as “larger” rating services and the other companies referred to as “smaller” rating services. The SEC said...

A case in bankruptcy court regarding the priority of payment provisions for collateralized debt obligations could have broad ramifications for derivatives transactions at the heart of the structured finance industry, according to the Structured Finance Industry Group and other industry groups. In late December, SFIG filed an amicus brief in Lehman Brothers Special Financing v. Bank of America, which is being heard in U.S. Bankruptcy Court for the Southern District of New York. The Securities Industry and Financial Markets Association and the International Swaps and Derivatives Association filed a separate brief, making points similar to those raised by SFIG. LBSF is suing...

The prospects for consumer ABS in 2016 are a bit mixed. Auto ABS – especially subprime – appear susceptible to the Federal Reserve’s promised raising of interest rates this year and beyond, but credit card ABS are strong and performing well. “Rising interest rates could pressure U.S. auto ABS transactions, especially first on subprime deals,” analysts at Fitch Ratings said in a recent client note. While they expect last month’s initial rate increase by the Fed to have only a marginal near-term impact on borrowers, they said the plan to raise rates gradually over four years could increase the monthly debt burden on auto loan borrowers. “Although the rate increases are expected to affect the entire market, Fitch believes...

Then again, we also hear reports that the worst of the TRID mess will be over by the end of February…

Freddie Announces New Alliance with Lenders One. Freddie Mac has teamed up with Lenders One Mortgage Cooperative, based in St. Louis, to give Lenders One members who are Freddie seller/servicers pricing and execution benefits, enhanced access to mortgage products, and professional training and development opportunities. Freddie did not provide additional details on specific pricing benefits .Chris Boyle, senior vice president of single-family sales and relationship management at Freddie, said Freddie Mac is pleased to “help its members reach more eligible borrowers, achieve new efficiencies in the origination process and build strong, competitive businesses.” In related news, Lenders One is still...