WASHINGTON - (10/03/05) -- A bill introduced in the House lastweek would allow hundreds of thousands of homeowners in Louisiana,Mississippi and Alabama, whose houses were destroyed by floodingafter Hurricane Katrina, to retroactively obtain coverage under theFederal Emergency Management Agency's National Flood InsuranceProgram. The bill, sponsored by Rep. Gene Taylor, D-Miss., and 28other Democrats, would allow uninsured owners of residences andbusinesses in the three states to acquire retroactive coverage inexchange for payment of 10 years of premiums and a 5% premium,according to Brian Morton, legislative director for Rep. Taylor.Taylor was meeting with Republican leaders last week, includingLouisiana Rep. Richard Baker, Michael Oxley, chairman of the HouseFinancial Services Committee, and Mississippi Senators Trent Lottand Thad Cochran, to try to enlist their critical support. Abailout of uninsured property owners in the Gulf States would costtens of billions of dollars as FEMA has estimated that more than350,000 homes and businesses destroyed by post-Katrina flooding didnot have coverage under the NFIP, the only flood insurance carrierin the country. "We're still trying to figure out the costestimates," Morton told The Credit Union Journal. The lack of floodinsurance for storm-hit states could cost credit unions, banks andother mortgage lenders billions of dollars in losses if the federalgovernment does not step in. CUNA said last week it endorsed theTaylor bill. Though one CUNA lobbyist told The Credit Union Journalwithout Republican support the bill's chances of passage arenil.
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The Cleveland-based bank is projecting steady growth in net interest income even as credit losses remain manageable. But Chairman and CEO Chris Gorman also said that he thinks a recession is likely.
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The first-quarter increase involved commercial real estate loans, including some problematic multifamily loans and an office credit, but none of the criticized loans were to consumers, officials at the Dallas company say. Further CRE deterioration is anticipated.
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The Detroit-based company is exploring ways to make more consumer auto loans without running afoul of stricter capital standards that are expected from the Federal Reserve. Possible approaches include more securitizations and the use of credit risk transfers.
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The House Financial Services Committee also sent to the full House two bipartisan bills, including one that would prevent large banks from opting out of having to recognize Accumulated Other Comprehensive Income in regulatory capital.
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Charge-offs and nonperforming loans rose at the Georgia bank in the first quarter. But it blamed the problem on one large client and said the matter has been resolved.
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Amid healthy first-quarter loan growth and improving credit quality, Discover Financial Services slashed its profits by $800 million to offset remediation costs from a 16-year period when it overcharged certain merchants.
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