This story appeared in Bank Digest.
In speeches in Washington, D.C., Fed Chairman Ben Bernanke and Fed Governor Elizabeth Duke addressed the need for banks and regulators to find ways to get more credit to small businesses so they can create jobs. “Making credit accessible to sound small businesses is crucial to our economic recovery and so should be front and center among our current policy challenges,” Bernanke said in prepared remarks to the Fed's forum on restoring credit to small businesses.
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Bank Digest.
The Federal Deposit Insurance Corp. has issued an alert with regard to a Federal Housing Finance Agency (FHFA) statement concerning certain energy retrofit lending programs. The FDIC warns its insured institutions in the alert to be aware of such programs, as the programs could affect their residential mortgage lending activities and the ability to sell loans to Fannie Mae and Freddie Mac. Among the issues highlighted by the FDIC are that the FHFA statement: advises that certain energy retrofit programs use the municipal tax assessment process to ensure repayment, which results in a priority lien status that supersedes the position of existing properly recorded lien holders; indicates that underwriting and consumer protection standards, as well as energy retrofit standards, are being developed for these programs to ensure borrowers have the ability to repay the new monies in addition to existing obligations and consumers receive appropriate truth-in-lending disclosures; and directs Fannie Mae, Freddie Mac and the Federal Home Loan Banks to take specific actions that protect their operations.
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This story appeared in Bank Digest.
The Federal Housing Finance Agency has announced a major new initiative by Freddie Mac and Fannie Mae (the Enterprises) to improve the consistency and quality of data for appraisals and other loan information. The initiative is intended to enhance the depth of collateral, borrower and loan data submitted to the Enterprises. The Uniform Mortgage Data Program is a long-term, joint effort to create improved and uniform data standards and collection processes. The Enterprises worked with industry participants to develop the uniform standards.
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By Sarah Borchersen-Keto, CCH Washington News Bureau, Contributing Author, the CCH Federal Banking Law Reporter.
Public pressure needs to be maintained on the banking industry in order to ensure that loans are being made to creditworthy borrowers, Federal Deposit Insurance Corp. Chairman Sheila Bair said March 8, 2010.
“A light needs to be shined on this and explanations need to be made where credit is not being provided,” Bair said in response to questions following a speech to the National Association for Business Economics. Bair acknowledged that while credit was too freely available prior to the financial crisis, now, “I’m concerned we’re recoiling too far the other way.”
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By Sarah Borchersen-Keto, CCH Washington News Bureau, Contributing Author, the CCH Federal Banking Law Reporter.
Commercial real estate (CRE) loans are probably the “biggest threat” to smaller and regional banks at this time, Federal Reserve Board Chairman Ben Bernanke told Congress February 24, 2010.
Appearing before the House Financial Services Committee, Bernanke told members that CRE “remains probably the biggest credit issue that we still have.” The Fed Chairman said the central bank will be watching small and medium-sized banks “very carefully” in light of their exposure.
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