* WASHINGTON (1/29/09)--Rep. Spencer Bachus (R-Ala.) Tuesday announced that the House Financial Services Committee has selected subcommittee seats and ranking member positions. For a complete list of names,
use the link. .. * WASHINGTON (1/29/09)--The Federal Housing Finance Agency has published an interim rule in the Federal Register
addressing the critical capital level and four capital classification categories for the Federal Home Loan Banks. Banks will be considered “undercapitalized” if their assets are 3% to 4% of capital, “significantly undercapitalized” if the figure is between 2% and 3%, and “critically undercapitalized” if assets are under 2%. The rule also implements prompt corrective action provisions that the Housing and Economic Recovery Act of 2008 (HERA) applied to the banks. If banks wrote off their portfolios of private mortgage-backed securities, only Des Moines, New York, Dallas and Cincinnati banks would be adequately capitalized, according to Moody’s (American Banker
Jan. 28). The FHFA also published a regulation Tuesday that would allow Fannie Mae and Freddie Mac to grow their mortgage assets up to $850 billion by Dec. 31. Starting Dec. 31, 2010, they must hold 10% fewer mortgage assets in their portfolios than at the end of the preceding year until those assets reach $250 billion ... * WASHINGTON (1/29/09)--The U.S. Supreme Court has agreed to hear a case in April involving New York Attorney General Andrew Cuomo, who charges that JPMorgan Chase and Co., Wells Fargo and Citigroup gave white borrowers lower-priced mortgages than they gave to minority borrowers. The case involves a state’s right to request data from banks to ensure compliance with state anti-discrimination laws. Observers question the court’s decision to hear the case because the court ruled in April 2007 that states were not allowed to investigate federal institutions (American Banker
Jan. 29). The court may have taken the case to confirm the Office of the Comptroller of the Currency’s preemption powers, observers say. The case also would let Justice Clarence Thomas weigh in on the preemptive powers issue since he has taken himself off of similar cases involving Wachovia, where his son works. Wachovia was recently purchased by Wells Fargo ... * WASHINGTON (1/29/09)--The Federal Deposit Insurance Corp. (FDIC) is proposing a national rate establishing how much banks can pay for brokered deposits. Currently institutions cannot pay more than the rates in their normal market area (American Banker
Jan. 28). However, the agency recognized that normal market area is ambiguous because Treasury rates are low. If a national rate is established, the agency would still require that adequately capitalized banks obtain a waiver from the FDIC for new deposits. Uncapitalized banks and thrifts would not be able to accept deposits ... * WASHINGTON (1/29/09)--The Federal Reserve Board is attempting to stem foreclosures by requiring banks to modify select delinquent mortgages. Included in the mortgages are the assets the Fed acquired in the American International Group and Bear Stearns rescues (CNNMoney.com
Jan. 28). Democratic lawmakers, including Rep. Barney Frank (Mass.) and Sen. Christopher Dodd (Conn.), supported the move. Under the program, loans must be at least 60 days delinquent, have a debt-to-income ratio less than 38%, a term no longer than 40 years and a fixed interest rate (American Banker
Jan. 28) ...