HOME LOANS: The Office of the Comptroller of the Currency on March 2 became the fourth and final agency to sign off on an interagency rule that could discourage the use of so-called 80-10-10 residential mortgages. Under the rule, financial institutions would have to hold 8% of the loan amount in capital reserves against both the 80% first mortgage and the 10% second mortgage. Effective April 1.
CYBER-TERRORISM: The OCC issued guidelines March 5 to help national banks ward off computer hackers. The agency said banks should install firewalls for their computer systems and monitor employees' computer use.
SUBPRIME LENDING: The OCC, the OTS, the Fed, and the Federal Deposit Insurance Corp. issued joint guidelines March 3 urging subprime lenders to boost capital levels, hire experienced loan officers, adopt proper collateral and appraisal requirements, and implement extensive monitoring of subprime portfolios.
BROKER FEES: The Department of Housing and Urban Development issued a final policy statement clarifying that fees paid by lenders to mortgage brokers are not necessarily illegal. Such fees must be proportional to the value of goods or services provided. Published and effective March 1.
CAPITAL: The four bank and thrift regulators adopted uniform capital rules for leverage ratios, several types of loans, and mutual fund investments. The rule mostly clarifies existing policies. Published March 2. Effective April 1.
LOAN CHARGEOFFS: The Federal Financial Institutions Examination Council dropped a controversial plan to require banks to write off all bad loans within 150 days. Instead, regulators will retain the 120-day writeoff period for closed-end loans and the 180-day period for open-end loans. Regulators also revised several minor chargeoff policies. Published Feb. 10. Effective for the June 30 call report.
SECURITIZATION: The Small Business Administration issued a final rule allowing banks to securitize the nonguaranteed portion of 7(a) loans if they retain a portion of the credit. Published Feb. 10. Effective April 12.
CONSUMER CREDIT: The OTS removed its regulatory definitions of "consumer credit classified as a loss," "slow consumer credit," and "slow loans." The OTS said the definitions are not necessary for the interpretation of any regulations. Published Feb. 10. Effective April 1.
TECHNOLOGY EXAMS: The Exam Council adopted a uniform system for rating the safety and soundness of financial institutions' information technology. The new system is modeled on Camels. Published Jan. 20. Effective April 1.
DIVIDENDS: The OTS ruled that healthy thrifts do not need the agency's permission before paying out dividends. Published Jan. 19. Effective April 1.
SETTLEMENT SERVICES: The Fed introduced a fully automated settlement service that completes payments the day they are made without requiring participating banks to initiate Fed Wire transfers. Published Nov. 3. Effective March 29.
DEPOSIT INSURANCE: The FDIC announced in early February that it was postponing implementation of a plan to make healthy but risky banks pay higher deposit insurance premiums. The revised plan, which would not take effect before the first half of 2000, would rely on indicators of abnormality such as rapid asset growth, asset concentration, unusual loan yields, and changes in the business mix.
