Capital

Proposed capital rules aimed at bigger institutions will force regional and larger community banks to consider ways to grow or seek an exit strategy, bankers and analysts predict.

A proposed settlement between the Philadelphia-based community bank and an activist investor group that has waged a nearly two-year battle for control also calls for overhauling the board of directors.

The impact on things like servicing rights would raise costs even for lenders that aren't banks, according to Mortgage Bankers Association President and CEO Bob Broeksmit. Others disagree.

But at the same time, the publicly traded company is selling off another type of housing finance asset to some large depository institutions.

Consumer advocates are protesting specific risk-weighting changes affecting borrowers with lower down payments. Also, a broader increase in requirements may discourage depository holdings of servicing.

Led by Chairman Marshall Reynolds, the entire board of directors participated in a private placement that raised $10 million for the Hammond, Louisiana, company.

The National Credit Union Administration would give tentative OKs to organizers of startups so they can secure enough capital for a final approval, Vice Chairman Kyle Hauptman says. Some industry observers describe the plan as a step in the right direction, while others complain more has to be done to foster new credit unions.

The Biden administration is poised to put its stamp on the banking regulatory landscape, but there are few slam-dunk solutions that will satisfy both the industry and a vocal Democratic base.

Toronto-Dominion Bank Chief Executive Bharat Masrani said additional share repurchases would be a possible use of the lender’s excess capital if it doesn’t deploy those funds in a major acquisition.

This year's assessment for Fannie Mae and Freddie Mac is the first to take into account a January agreement between the Federal Housing Finance Agency and the Treasury Department that allowed the companies to retain more earnings.