Regulatory Compliance Update January 2018

Regulatory Compliance Update

By: Hickman Beckner, Senior Vice President

December was a slow month for regulatory activity.  Congress enjoyed a short month with the Christmas recess and the on-going struggle at the CFPB over the new director brought a slowdown in regulatory activity.

Federal Reserve – has amended the Community Reinvestment Act to clarify the loans to be reported:

Home Mortgage Loan has been redefined to mean a closed-end loan open-end line of credit as defined in Regulation Z (Truth In Leaning ACT).

Consumer Loan has been redefined to remove home equity loans from the definition.

Home Mortgage Disclosure Act Statement no longer has to be posted in the public file.  The institution only has to provide a notice that the Statement is available from the CFPB.

The HMDA Reporting asset size threshold has been increased to $44 million.

Higher Priced Mortgage Escrow Account Exemption asset size threshold has been increased to $2.112 billion.

Significant Dates:

December 18, 2017 – Comments due on IRS proposal to permit employers to mask the social security number on employee’s W2 forms.

January 1, 2018 – Effective date for changes to Regulation C that implement the Home Mortgage Disclosure Act.  We removed the HMDA data gather from both Commercial and Retail in response to the new requirements.

January 1, 2018 – Effective date for changes to the Regulation B – data gathering and retention of ethnicity, sex and race of certain mortgage loan applicants.  We removed the data gathering components from the Systems due to lack of use by our clients.  They gather the data in their loan origination systems.

January 8, 2018 – Comments due on the FFIEC changes to the Bank Call Report discussed above.

March 16, 2018 – Effective date for Phase 3 of NACHA Same Day ACH Processing.

Emerging Legislation:

There have been a few bills introduced in Congress:

Protecting Consumers’ Access to Credit – Would require that the interest rate on loans would remain unchanged after transfer of the loan.  This will impact loans that are sold.  The purchaser would not be allowed to increase the interest rate of a defaulted loan that is sold.

There was also a flurry of bills introduced just prior to the recess.  We will watch the progress of these bills through Congress.

Other Significant Events:

Mick Mulvaney, interim chief of the CFPB, informed the Federal Reserve in a letter that he wanted no new money to fund the bureau’s operations.  The CFPB, makes quarterly requests to the Federal Reserve for funding.  Most federal agencies are funded directly by Congress.   Instead of getting new funds from the Fed, Mulvaney said he plans to spend down a $177 million reserve fund established by his predecessor, Richard Cordray, who resigned from the agency in November.

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