Law and regulation

In yet another revision of its mortgage rules, the Consumer Financial Protection Bureau proposed making it easier for small and rural lenders to make "qualified mortgages." Industry representatives said the changes are poised to make a big difference.

The Consumer Financial Protection Bureau plans to review loan modifications offered by private student lenders, a business that the agency has said victimized some borrowers with subprime-style debt.

WASHINGTON — The Treasury Department has exceeded its authority by keeping Fannie Mae and Freddie Mac in conservatorship so long and taking all their profits, two legislative experts said Thursday.

Federal regulators announced guidance Thursday that provides principles institutions should consider in setting policies and procedures for originating private student loans with graduated repayment terms.

Banks have made progress cutting their exposure to risky home equity lines of credit, ahead of a key 10-year threshold when billions of dollars of them will reset to higher monthly payments. But there are some prominent exceptions, especially among regional banks.

The Consumer Financial Protection Bureau on Thursday proposed a series of regulatory relief measures for small institutions, especially those in rural areas, to help them provide credit while they try to follow the agency's tough mortgage rules.

WASHINGTON — Sen. Elizabeth Warren, D-Mass., and Rep. Elijah Cummings, D-Md., are prodding the biggest banks for information about how they will respond to changes to a controversial Dodd-Frank Act swaps provision signed into law last month.

The Basel Committee's revisions to banks' risk disclosure requirements should help investors glean more meaningful information, thereby allowing them to impose market discipline on less creditworthy institutions.

Banks partnering with prepaid card providers face the potential of higher deposit insurance fees and other ramifications from the Federal Deposit Insurance Corp. classifying accounts as "brokered."

Joining the hunt for higher-yielding niche loans, the asset management unit of NewOak Capital has quietly launched a private fund to acquire nonqualified residential mortgages.

The Federal Deposit Insurance Corp. issued a letter Wednesday emphasizing that financial institutions should take a measured approach to banking relationships rather than cutting ties with entire lines of businesses.

Dumping entire categories of clients is a crude and inappropriate reaction to large fines, says Stephen Platt, author of Criminal Capital: How the Finance Industry Facilitates Crime." However, he says, regulators should hold a dialogue with banks and attempt to accommodate businesses that carry high risk but whose services are desperately required, such as remittances to war-torn Somalia.

WASHINGTON — The Basel Committee on Banking Supervision has issued "harmonized templates" for regulators to adopt in order to ensure that banks' risk and capitalization disclosures are comparable and consistent.

The U.S. is investigating whether the Netherlands' Rabobank Groep ignored signs of money laundering by clients at branches of its California banking unit near the Mexican border, according to people with knowledge of the matter.

The government has added further protections to reverse mortgage borrowers' spouses who are not named in the loan agreement, but placed conditions under which they are ineligible for older protections.

Banks partnering with prepaid card providers face the potential of higher deposit insurance fees and other ramifications from the Federal Deposit Insurance Corp. classifying accounts as "brokered."

Aiming to address a nationwide shortage of affordable housing, FHA has launched a risk-sharing pilot program that it hopes will encourage community development lenders to finance the rehabilitation of smaller multifamily apartments.

Arch Capital Group is repurposing a subsidiary to insure mortgages that are headed for private securitizations. Insuring such loans separately from the unit that works with Fannie and Freddie lets Arch offer more favorable terms to lenders.

The federal courts have instated a $25 fee for transferring corporate bankruptcy claims. The decision was met with little fanfare — but it could pave the way to a financial transactions tax.

The Financial Stability Oversight Council's proposed changes to its process for designating nonbanks as systemically important are being widely praised as helpful and responsive, but many stakeholders say that they do not go far enough.