Advocacy
ICBA, Coalition: Clean-Energy Loan Program Too Risky
ICBA and a coalition of other financial services trade groups told the Federal Housing Finance Agency that they cannot support property assisted clean energy (PACE) programs. PACE loans are offered in certain states to finance energy-efficient home improvements, such as solar panels. However, the coalition noted, these loans pose risks to lenders because the loans become a first lien against the property, and the lender generally is not notified of it.

The FHFA is proposing to require Fannie Mae and Freddie Mac to secure their rights to accelerate loans on properties that become subject to a PACE lien without the mortgage holder’s consent. The agency also proposed prohibiting the government-sponsored enterprises from purchasing mortgage loans on properties on which there is a PACE first lien.

The coalition wrote that while the FHFA’s risk-mitigation alternatives would provide varying degrees of protection for taxpayers and for consumers, they would not address who would pay the cost of implementing them. The groups noted that the GSEs would appear to impose additional duties on servicers without providing reimbursement.

Finally, the trade groups encouraged the Consumer Financial Protection Bureau to look at PACE loans from a consumer protection perspective and subject them to consumer protection rules as appropriate. They wrote that the loans should at least be subject to ability-to-repay standards because there currently is little if any underwriting or oversight of the loans. Read the Coalition Letter.


Capital
ICBA Magazine Breaks Down Basel III
Federal regulators’ failure to exempt community banks from proposed Basel III capital standards sent a shockwave through the community banking industry, according to an article in the latest issue of ICBA Independent Banker. “Rather than target the largest and most systemically risky financial institutions, the regulators painted the industry with a decidedly broader brush,” ICBA Vice President of Accounting and Capital Policy James Kendrick writes.

ICBA is urging community bankers and industry allies to sign the association’s petition calling on regulators to exempt community banks from the proposal and to allow community banks to continue operating under Basel I capital regulations. More information on the Basel III capital standards is available on ICBA’s comprehensive webpage. Read the Article. Sign the Petition Today.


Congress
Bill Would Bar Mortgage Loan Purchases in Eminent Domain Counties
New legislation would prevent federal housing authorities from purchasing mortgage loans originated in counties where a municipality has seized a mortgage loan through the power of eminent domain within the previous 10 years. H.R. 6397, sponsored by Rep. John Campbell (R-Calif.), would apply to Fannie Mae, Freddie Mac, the Federal Housing Administration and the Department of Veterans Affairs.

Several local governments have recently sought to use eminent domain to seize and refinance underwater mortgages. ICBA strongly opposes the use of eminent domain to seize residential mortgages so that they may be refinanced.

In a recent letter to the Federal Housing Finance Agency, ICBA wrote that the effort would only help a relatively small number of borrowers, but would have harmful consequences far beyond the communities using eminent domain.

ICBA wrote that using eminent domain would make credit more difficult and expensive to obtain. The association also wrote that investors would be hurt by the declining value of mortgage-backed securities as mortgages are seized.



Regulators
Reserve Banks Highlight Services as Remittance Rule Looms
The Federal Reserve Banks said they have evaluated their FedGlobal service offerings to determine how best to help customers comply with new rules on remittance transfers. The final rule amends Regulation E to create a number of new requirements for remittance transfer providers that take effect Feb. 7, 2013.

The reserve banks noted that FedGlobal ACH Payments customers have access to the FedGlobal Formatting Aid, a complimentary tool designed to facilitate relevant disclosures about international transfers. The service enables customers to provide estimated disclosures for foreign exchange rates, foreign fees and taxes, and exact disclosures for date of funds availability. Learn More from FRBs.



Housing
Interactive Video Helps Struggling Homeowners Find Help
Fannie Mae released an interactive video designed to educate homeowners about their options to avoid foreclosure and seek help. The video is set in a neighborhood that has been hurt by the foreclosure crisis and features actors who play residents in financial distress. Homeowners select to play one of the residents and, as their stories unfold, make important financial decisions for them and see how the consequences of these decisions play out. Watch the Video.



Regulators
FDIC Releases State Banking Profiles
The FDIC released its state banking profiles for the second quarter. The FDIC State Profiles are formatted as a quarterly data sheet summarizing economic and banking conditions for all 50 states, Puerto Rico and the Virgin Islands
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Poll
Take This Week’s Quick Poll
Take this week’s Quick Poll on multigenerational marketing, and view results from the previous poll on customer complaint policies.

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