Consumer lending

MPOWER Financing announced a deal Tuesday with Bank of Lake Mills in Wisconsin that will enable the Washington, D.C.-based company to lend to students in all 50 states.

TCF executives were peppered with questions about the quality of $345 million in auto loans recategorized as held for investment in the second quarter, as a result of the company’s recent move away from loan sales and securitizations.

Double-digit growth in loan volume offset a decline in fee income at the Honolulu company.

Net interest income rose 7% and margins widened 17 basis points at the Wayzata, Minn., company.

Auto risks mounting. Mortgage market tightening. Are there any good risks these days in consumer lending? Regional bank executives insist partnerships with online lenders, unsecured personal loans and other niche efforts can work if done properly.

The Rhode Island bank plans to build out its fee income capabilities, expand C&I lending in the Southeast, renegotiate vendor contracts and take other steps to produce expense cuts and revenue enhancements of at least $90 million.

Increased dealings in direct consumer lending and guaranteed student loans offset a decline in mortgage-related income. A lower loan-loss provision also helped the bottom line.

The McLean, Va., lender, which has substantial exposure to subprime consumer loans, also added to its provision for credit losses.

LendKey, whose software helps financial institutions make student, auto and home improvement loans, closed a Series C round led by a fund whose investors include more than a dozen banks.

Though a 33% decline in net income was attributable to large one-time gains that the credit card issuer recorded in the second quarter of 2016, Amex faces major challenges in the pursuit of growth opportunities.