Weekly Topic Update (Jan 21 to Jan 27)
The online lending arm of Goldman Sachs, Marcus, has started offering home improvement loans as part of its push into consumer lending. The loans, available in the range of $3,500 to $40,000 for periods of three to six years, come with no sign-up fees, no late fees and no prepayment fees. In case of late payments, customers just have to pay interest for the additional days. Additionally, the relatively quick application process doesn’t require a home appraisal.
Source: Retail Banker International
OCC, FDIC, FRS | Lending | Mortgage Lending | Register Notice | 01/08/2018
CFPB | Lending | Register Notice | 11/13/2017
VA | Lending | Register Notice | 01/19/2018
ED | Lending | Register Notice | 01/22/2018
Reuters • Lending • Industry News
The OCC reports the competitive lending environment is driving incremental easing in commercial underwriting standards, however it’s leading to increased risk across the sector. Its Semiannual Risk Report found U.S. banks’ performance improved in the first half of 2017 compared to one year ago, while capital and liquidity remain near historic highs. The report also noted several areas of concern, including looser standards in underwriting practices as banks compete for loans against non-bank lenders and rising concentration in certain loan portfolios. It warned that if financial markets tighten quickly or the economy slows, banks could face even greater risks from potential customer defaults.
Law360 (sub. req.) • Lending • Industry News
CashCall was ordered to pay a $10-million penalty for offering high-interest loans via a tribal lands-based firm in states where payday loans are barred however a California federal judge denied the CFPB’s bid for $287 million in restitution and penalties. The statutory penalty is sufficient as the company was the “true lender” of payday loans that were issued to borrowers, the judge said.
Compliance Week • AML BSA CTF • Industry News
Lawmakers are arguing that since efforts to attack the root causes of money laundering in the U.S. are sorely lacking, an update to BSA/AML regulatory regimes must be a bipartisan cause. Among ideas being presented are resolving the privacy roadblocks to data sharing and using modern technology, including AI and machine learning, to address shortcomings. Part of this push includes the Anti-Money Laundering Modernization Act of 2017, introduced last September.