FFIEC Issues Interest Rate Risk Advisory
This Advisory was issued on January 7th, and reminds financial institutions of the sound practices expected to manage interest rate risk. This includes effective corporate
governance, policies and procedures, risk measuring and monitoring systems, stress testing, and internal controls. A copy of the release may be found at: http://www.ffiec.gov/press/pr010710.htm
 | FinCEN Issues Customer Identification Program Ruling This ruling addresses the situation of depositors who participate in a state address confidentiality program, where the depositor is issued a post office box address as part of their participation in the program. In this situation, FinCEN authorizes the following exception to the requirement that a financial institution obtain a customer's residential or business street address: a customer who participates in a state-created ACP shall be treated as not having a residential or business street address and a secretary of state, or other state entity serving as a designated agent of the customer consistent with the terms of the ACP, will act as another contact individual for the purpose of complying with FinCEN's rules. Therefore, a financial institution should collect the street address of the ACP sponsoring agency for purposes of meeting its CIP address requirement. The text of the ruling is available at: http://www.fincen.gov/statutes_regs/guidance/html/fin-2009-r003.html |
 | FRB Issues Final Rule Amending Regulation Z On January 12th, the Federal Reserve Board issues final rules implementing the Credit Card Accountability Responsibility and Disclosure Act. The rules are effective February 22, 2010. Among other things, the rule affects: > increasing rates on existing card balances; > assessment of borrowers ability to make payments; > special requirements to applicants under the age of 21; > limitations on fees for exceeding the card limit. The press release containing the link to the final action may be found at: http://www.federalreserve.gov/newsevents/press/bcreg/20100112a.htm |
| FRB and FTC Issue Final Rule on Risk Based Lending Disclosure This rule implements the risk-based pricing provisions in section 311 of the Fair and Accurate Credit Transactions Act of 2003 (FACT Act). The final rules generally require a creditor to provide a risk-based pricing notice to a consumer when the creditor uses a consumer report to grant or extend credit to the consumer on material terms that are materially less favorable than the most favorable terms available to a substantial proportion of consumers from or through that creditor. The rule also addresses provisions for two alternative means by which creditors can determine when they are offering credit on material terms that are materially less favorable. It also includes certain exceptions to the general rule, including exceptions for creditors that provide a consumer with a disclosure of the consumer’s credit score in conjunction with additional information that provides context for the credit score disclosure. The rule is effective January 1, 2011. It may be found at: http://www.federalreserve.gov/newsevents/press/bcreg/20091222b.htm, and then click on the attachment link. |
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| FFIEC Updates 2010 HMDA Edits On January 19th, the FFIEC issued updates to its HMDA edits. The purpose of the edits (Quality, Validity, Syntactical) is to provide an explanation of specific edit questions. They should be thoroughly checked to ensure data is reported accurately. The edits may be found at: http://www.ffiec.gov/hmda/edits.htm |
Credit Card Rules may be changing again – Are you surprised?
The Federal Reserve Board has indicated it is considering the impact of the credit card rule regarding the ability to increase interest rates on a card when a floor is part of the agreement, and the floor prevents the interest rate from moving down in the same manner it moves up. More information should be made available by the FRB in the near future.
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| Treasury & HUD Update Mortgage Modification Guidance The updated guidance applies to HUD’s Home Affordable Modification Program (HAMP). The update deals with the issues requirements that documentation be provided before trial modification begins and converting borrowers in the temporary review Period to permanent modifications. The Guidance may be found at: https://www.hmpadmin.com/portal/index.html |
NCUA Amends Redundant Credit Card Rule
The NCUA Board withdrew the portion of the Unfair or Deceptive Acts or Practices (UDAP) rule, Part 706, created to prohibit unfair and deceptive acts and practices related to consumer credit cards to prevent unnecessary confusion for credit union regulatory compliance. Set to become effective in July 2010, the UDAP rule duplicates, overlaps, and in some provisions conflicts with the more recent Credit CARD Act of 2009 and new Regulation Z provisions, which become effective February 22, 2010. The withdrawal is effective July 1, 2010.