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aRTiCLeS



        combines the separate Fannie Mae and Freddie Mac to-be-  Regulators Update Host-State
        announced markets into one, bringing additional liquidity and   Loan-to-Deposit Ratios
        efficiency to the market. By addressing structural issues and trading
        disparities, the UMBS will benefit taxpayers and the nation's   The federal banking agencies have issued updated host-state loan-
        housing finance system.”                                to-deposit ratios that they will use to determine compliance with

        To read more visit: https://bankingjournal.aba.com/2018/02/  Section 109 of the Riegle-Neal Interstate Banking and Branching
        change-is-coming-to-the-tba-market-an-update-on-the-single-security/  Efficiency Act.
                                                                Section 109 prohibits banks from establishing or acquiring
        FDIC Votes to Approve Joint                             branches outside their home states primarily for the purpose of

        Agency Capital Simplification                           deposit production. Congress enacted Section 109 to ensure that
                                                                interstate branches would not take deposits from a community
        Proposal                                                without helping to meet its credit needs.

        The FDIC has voted to approve a final                   To read more visit: https://www.fdic.gov/news/news/press/2019/
        interagency rule that would simplify                    pr19041a.pdf
        the complex Basel III regulatory capital
        calculations for all but the very largest               S. 2155 Rule Changes to Be Done
        banks. The final rule would simplify the treatment of assets
        subject to common equity tier 1 capital threshold deductions   by Year-End, Regulators Say
        and limitations on minority interest with a more straightforward   The heads of the banking agencies told lawmakers that they expect
        measure.                                                to have regulatory changes from the S. 2155 regulatory reform law

        The final rule would simplify regulatory capital requirements   implemented by year-end. Testifying before the House Financial
        for mortgage servicing assets, certain deferred tax assets arising   Services Committee recently, Federal Reserve Vice Chairman for
        from temporary differences and investments in the capital of   Supervision Randal Quarles said that the agencies are “on track to
        unconsolidated financial institutions (such as investments in   complete the implementing actions for S. 2155,” adding that they
        trust preferred securities) by effectively raising the deduction   would “have the bulk of the implementing actions completed by
        threshold for each of these to 25%. The final rule also simplifies   the third quarter of this year, and all of them completed by the end
        the calculation for capital issued by a consolidated subsidiary of a   of this year.”
        banking organization and held by third parties (sometimes referred   Items still outstanding include a final rule on the treatment of
        to a minority interest) that is includable in regulatory capital.  high-volatility commercial real estate, a framework for applying

        The key changes in the final rule are limited to banks not using the   enhanced prudential standards to banks with more than $100
        Basel advanced approaches.  In addition, banks do not have the   billion in assets, an appraisal exemption for certain rural real-estate
        option to early-adopt the relief provisions, which do not take effect   transactions and the finalization of the community bank leverage
        until April 2020.                                       ratio.
        To read more visit: https://www.fdic.gov/news/board/2019/2019-  Regulators also faced questions from several lawmakers who raised
        05-28-notational-mem-a.pdf                              concerns about the current expected credit loss standard and its
                                                                effect on credit availability. When asked about the extent to which
        To read the final rule visit: https://www.fdic.gov/news/  the agencies themselves have evaluated the implications of CECL,
        board/2019/2019-05-28-notational-fr-a.pdf               FDIC Chairman Jelena McWilliams acknowledged that “it’s
                                                                difficult, because there are so many different ways of implementing
        CFPB Issues TRID FAQs                                   CECL.” As implementation moves forward, “our hope is that . .
                                                                . we will be able to get the information from the first tranche of
        The CFPB has issued a set of FAQs on the TILA-RESPA
        Integrated Disclosures. The FAQs address corrected closing   banks that are complying,” she said.
        disclosures and the three business-day waiting period before   Comptroller of the Currency Joseph Otting added that regulators
        consummation; model forms; and construction loans.      will be closely monitoring the regulatory capital effects of CECL
                                                                over the three-year phase-in period, noting that “there’s no magic
        To read more visit: https://www.consumerfinance.gov/policy-
        compliance/guidance/tila-respa-disclosure-rule/tila-respa-integrated-  to that number – if there are other issues, we’ll be happy to
        disclosure-faqs/                                        consider that.” Added Quarles: “As we see the consequences of
                                                                CECL during the phase-in period, we have the tools to respond on
                                                                the capital side.”




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