Nonbank

Despite clear evidence to the contrary, the mortgage insurer continues to insist that credit unions have the same risk profile as nonbank lenders. It’s now threatening to exclude nearly a quarter of credit unions from being qualified issuers of the securities it backs.

Banks are traditionally the target of anti-money-laundering regulations and law enforcement’s efforts to crack down on illicit finance. As the cryptocurrency sector grows, policymakers may subject it to customer identification requirements and other measures, analysts say.

While federal regulators attempt to overhaul the Community Reinvestment Act for banks, Congress has shown little interest in applying it to other lenders. But recent moves in Illinois and New York have given some stakeholders hope that state lawmakers will pick up the slack.

Income share agreements, which allow college graduates to repay tuition financing as a percentage of their future income, have come under fire lately from consumer advocates for questionable marketing and other potential legal violations. Some hope a partnership between a Virginia bank and an ISA provider will give the product more legitimacy, while others worry it just masks risks for borrowers.

With rock-bottom rates suppressing interest income, some buyers are looking beyond traditional M&A and striking deals for asset managers, insurance firms and other businesses that generate the bulk of their revenue from fees.

Some worry the Senate’s rejection of the OCC rule hampers efforts to clarify legal standards for banks selling loans to fintechs.

Three Republicans joined Senate Democrats in voting to overturn a rule issued by the Office of the Comptroller of the Currency that makes it easier for national banks to sell loans to nonbanks. A companion resolution has been introduced in the House.

The head of the Federal Reserve appeared to support Congress’s expanding the scope of the Community Reinvestment Act to unregulated institutions, just as regulators weigh how to modernize the framework for banks.

Democratic senators seek to block the "true lender" regulation, which they say lets national banks sell loans to lenders who then avoid state usury caps. Republicans say overturning the rule would restrict access to credit.

Banks could be a better option than payday lenders to meet consumers’ short-term credit needs. But all the OCC’s regulation does is enable partnerships that circumvent state usury laws.