In the latest demonstration that there’s a “new CFPB” as well as other new regulatory sheriffs in town, the CFPB, the federal banking agencies (OCC, FDIC, Federal Reserve Board, and NCUA), and state financial regulators issued a joint statement yesterday to announce that they will no longer provide “supervisory and enforcement flexibility” to mortgage servicers in meeting compliance requirements. … Continue Reading
Ballard Spahr attorneys complete White Paper on bank-model lending
By Mindy Harris & Ronald K. Vaske on
Ballard Spahr attorneys have now completed a months-long project in updating and expanding a 2017 White Paper addressing bank-model lending—programs involving partnerships between banks (or savings associations) and fintech or other nonbank companies in the interstate delivery of loans.
The new White Paper, which runs 49 pages single-spaced, is designed to serve as a comprehensive survey of laws, cases and regulatory attitudes addressing bank-model lending. … Continue Reading
DOJ announces major new initiative targeting redlining; DOJ/CFPB/OCC settle redlining lawsuit against Mississippi-based national bank
By Ballard CFS Group on
The Biden Administration’s prioritization of fair lending as a law enforcement focus took center stage last week with the announcement that the U.S. Department of Justice (DOJ) has launched a new initiative targeting redlining and that the DOJ and CFPB, in cooperation with the OCC, had settled the first lawsuit filed under the Initiative.… Continue Reading
CFPB, federal and state bank and credit union regulators warn of increased supervisory scrutiny in joint statement on managing LIBOR transition
By Ronald K. Vaske on
The CFPB, Federal Reserve Board, FDIC NCUA, OCC, in conjunction with the state bank and state credit union regulators, jointly issued a statement on managing the transition away from LIBOR (Joint Statement).
In 2017, the United Kingdom’s Financial Conduct Authority (FCA), the regulator that oversees the panel of banks on whose submissions LIBOR is based, announced that it would discontinue LIBOR sometime after 2021.… Continue Reading
President Biden nominates Saule Omarova for Comptroller of the Currency
By Glen P. Trudel & Ronald K. Vaske on
Posted in OCC
The White House announced this past Thursday that President Biden has nominated Saule Omarova to serve as Comptroller of the Currency.
Ms. Omarova is currently a law professor at Cornell University, where she serves as the Director of the Program on the Law and Regulation of Financial Institutions and Markets of Cornell’s Jack Clarke Institute for the Study and Practice of Business Law. … Continue Reading
This week’s podcast: Congress overrides the OCC’s true lender rule: what are the risks for banks and their loan program nonbank partners?
By Barbara S. Mishkin on
The OCC’s true lender rule was intended to create a bright line test for when a national bank or federal savings association should be considered the “true lender” in the context of third party partnerships but Congress overturned the rule. After reviewing the relevant background, we examine the Congressional override’s implications for future federal true lender rulemaking and its impact on existing law, key federal and state court challenges and decisions, state legislative and administrative developments, and risk mitigants for bank/nonbank partnerships, including potential loan program structures.… Continue Reading
Federal banking agencies issue guide for community banks on conducting due diligence on fintech companies
By Glen P. Trudel & Ronald K. Vaske on
The OCC, FDIC, and Federal Reserve Board have issued a guide that is intended to assist community banks in conducting due diligence when considering relationships with financial technology (fintech) companies (Guide).
The issuance of the Guide follows the agencies’ July 2021 release of proposed interagency guidance for banking organizations on managing risks associated with third-party relationships, including relationships with financial technology-focused entities such as bank/fintech sponsorship arrangements. … Continue Reading
Acting Comptroller of the Currency Hsu testifies about OCC activity on overdrafts, CRA, bank partnerships, alternative data
By Ronald K. Vaske on
This past Tuesday, Acting Comptroller of the Currency Michael Hsu appeared as a witness at the Senate Banking Committee’s hearing, “Oversight of Regulators: Does our Financial System Work for Everyone?”
In his written and oral testimony, Mr. Hsu stressed as an overall theme the need for the OCC to prohibit “predatory and discriminatory practices while promoting financial inclusion.” … Continue Reading
Ballard Spahr to hold Aug. 6 webinar on proposed guidance on risk management in third-party relationships
By Alan S. Kaplinsky on
Last week, the OCC, Federal Reserve Board, and FDIC issued proposed guidance for banking organizations on managing risks associated with third-party relationships, including those with financial technology-focused entities such as bank/fintech sponsorship arrangements. The agencies have made clear that if banks have ineffective risk management processes, agency examiners will closely scrutinize their third-party risk management and identify and report deficiencies in examination reports and recommend appropriate supervisory actions.… Continue Reading
Federal banking agencies issue proposed interagency guidance on risk management in third-party relationships; Ballard Spahr to hold Aug. 6 webinar
By Ronald K. Vaske on
The Federal Reserve, FDIC, and OCC have released proposed interagency guidance for banking organizations on managing risks associated with third-party relationships, including relationships with financial technology-focused entities such as bank/fintech sponsorship arrangements. The proposal is the first time that the three agencies have proposed third-party risk management guidance on an interagency basis. … Continue Reading