Regulatory Compliance Update August 2017

Regulatory Compliance Update

By: Hickman Beckner, Senior Vice President

The major regulatory activity in July was the proposal by the Federal Financial Institutions Examination Council (FFIEC) to change the Bank Call Report.  The changes decreased the frequency for some items and combined other items.  The changes will not require any modification to the Shaw solutions.

FFIEC – The Federal Financial Institutions Examination Council (FFIEC) has proposed revisions to the Bank Call Report that will take effect with the March 2018 report.  There are no additional data requirements in the proposed revisions.

FFIEC 051 – Certain eligible “small” institutions

Schedule RC-C Loans and Leases

Reduced frequency from quarterly to semi-annually for the following:

Purchase credit-impaired loans

Negative amortization loans

Loans acquired in an acquisition that were not credit-impaired.

Schedule RC-L

Deleted reporting for unused consumer credit card lines

Deleted reporting for other unused credit card lines consumer

Schedule RC-M

Combined the 1-4 Residential and GNMA foreclosures into a single item.

FFIEC 041 – Institutions with only domestic offices and less than $100B in assets

Schedule RC-C Loans and Leases

Reduced frequency from quarterly to semi-annually for the following:

Purchase credit-impaired loans

Negative amortization loans

Loans acquired in an acquisition that were not credit-impaired.

Schedule RC-L

Combined unused Home Equity Line and unused proprietary reverse mortgage lines into a single item.

Schedule RC-M

Combined the 1-4 Residential and GNMA foreclosures into a single item.

FFIEC 031 – Institutions with more than $100B in assets

Schedule RC-C Loans and Leases

Reduced frequency from quarterly to semi-annually for the following:

Purchase credit-impaired loans

Negative amortization loans

Loans acquired in an acquisition that were not credit-impaired.

Schedule RC-L

Combined unused Home Equity Line and unused proprietary reverse mortgage lines into a single item.

Schedule RC-M

Combined the 1-4 Residential and GNMA foreclosures into a single item.

Significant Dates:

August 1, 2017 – Comments due on the proposed changes to Regulation CC that cover altered or forged items and the original item is not available for review.

August 14, 2017 – Comments due on the CFPB proposed rules for prepaid accounts.

August 28, 2017 – Comments due on the FFIEC Bank Call Report changes discussed above.

September 14, 2017 – Comments due on CFPB’s request for information on the small business lending market.

September 15, 2017 – Effective date for Phase 2 of NACHA’s same day ACH processing.

September 29, 2017 – Effective date for NACHA Operating Rules that require registration of third-party senders.

October 19, 2017 – Effective date for CFPB final mortgage servicing rules covering:

Definition of delinquency

Forced placed insurance notices

Early intervention for defaults

Loss mitigation

Prompt payment crediting

Wording changes on statements to reflect successors in interest

Small servicers

October 19, 2017 – Effective date for CFPB’s interpretive ruling dealing with borrowers in bankruptcy.  The CFPB has created a “safe harbor” for sending statement to borrowers that have declared bankruptcy.   Since the effective date falls in the middle of the week, the CFPB has announced that lenders and servicers may implement the rules up to three days earlier or Monday, October 16, 2017.  The CFPB has also published the final rules for Reg. Z compliance for statements sent to confirmed successors in interest.

Emerging Legislation:

Bills continue to be introduced in both Houses of Congress to bring the CFPB under the congressional appropriations process and to reduce the CFPB’s authority to regulate certain transactions such as payday loans and to remove the CFPB’s authority over Unfair, Deceptive, or Abusive Acts or Practices (UDAAP).

Congress will be in recess for most of the month of August, so there will be fewer bills introduced.