Financial Institutions

Monday, 25 January 2016

Branch technology trends

Written by Rehmann Team

Brent King’s book Banking 3.0 (released in 2013), made the case that banking is no longer a place you go, but something you do, largely a result of radical changes in technology and consumer behavior. Then, the “2015 Digital Banking Report” by DBR Media released in February 2015, predicted that four of the top five retail banking trends would have a technology focus. Were those trends realized, and is technology in the driver’s seat when it comes to maximizing delivery channels that meet customer demands?..

Monday, 25 January 2016

Borrowers financial stability leads to better lending

Written by Rehmann Team

Disciplined underwriting includes proper evaluation for a borrower’s capacity to repay the mortgage, including a review of their income, employment, assets and liabilities, and other documentation that validates the borrower’s financial situation.Income — applicant’s gross monthly income from all verifiable sources that can reasonably be expected to continue at the then-current level for at least the next three years, and a two-year income history, verified by income tax returns Employment — identify income from primary and second jobs, earnings, bonuses, commissions, overtime or seasonal employment. Self-employed borrowers require closer examination since they are typically responsible for their personal financials and those of the company; evaluate the borrower’s individual tax return and complete business tax returns, including all schedules. Assets — verify sufficient assets to close and document the source to confirm the borrower did not take on unverified debt, and ensure they will have enough reserves after closing to continue repaying the mortgage if on-going cash flow is disrupted or diminished...

Monday, 05 October 2015

SBA lending shows strong upward trend

Written by Rehmann Team

It appears the Small Business Administration is fulfilling its mission to get lending flowing to small businesses to support their long-term success. According to the SBA’s Lending Statistics for Major Programs, the 7(a) and 504 programs have delivered on their funding promise, as of September 26, 2015: Totals for both types of loan approvals stand at $27.3 billion, a 20% increase over the same period in 2014 ($22.8 billion)...

Monday, 05 October 2015

TILA-RESPA implementation effective October 3, 2015

Written by Rehmann Team

Thanks to a procedural oversight (the CFPB failed to submit certain timely reports to the House of Congress and the Comptroller General of the GAO), implementation of the TILA-RESPA Final Rule and Amendments was delayed from August 1 to October 3, 2015. The delay was granted to facilitate smooth implementation and provide financial institutions with more time to prepare.According to the CFPB, the “Know Before You Owe” Final Rule and Amendments significantly strengthen and streamline the mortgage loan disclosures provided to consumers, noting “the stress of shopping for a mortgage will be reduced” for consumers who apply for most mortgages after October 3. By collapsing four overlapping disclosure forms into two forms, the new rule is designed to help ensure consumers understand the costs, risks and benefits of their loans before they make a final commitment to the loan, minimize changes at closing and make it easier for consumers to understand how and why closing costs may have changed...

Monday, 05 October 2015

Microchips coming to debit and credit cards

Written by Rehmann Team

Millions of consumers are starting to receive new credit or debit cards in the mail, not because their credit limit has been upped, they are being offered lower interest rates or they are enrolled in new reward programs. Rather, the new cards are being sent because they include high tech features that are intended to make transactions more secure than magnetic strip cards. The microchip technology adds a chip to the front of the card. The chip contains the cardholder’s name, card number and other account information; no other personal information is stored on the chip...

Monday, 05 October 2015

FFIEC CAT helps evaluate and manage cybersecurity risks

Written by Rehmann Team

Due to increasing volume and sophistication of cyber threats, the Federal Financial Institutions Examination Council (FFIEC) developed the Cybersecurity Assessment Tool (CAT) to help financial institutions identify their cybersecurity risks and determine their preparedness over time with a repeatable and measurable process. CAT helps guide financial institution leadership to improve their oversight and management by identifying factors that contribute to cyber risk, assessing cybersecurity preparedness and its alignment with overall risks, and determining risk management practices, processes and actions that might be needed or need to be enhanced. The Assessment consists of two parts: Inherent Risk Profile and Cybersecurity Maturity to determine if the bank’s risk and level of preparedness and corresponding controls align: Inherent risk profile identifies the amount of risk posed to an institution by the types, volume, and complexity of the institution’s technologies and connections, delivery channels, products and services, organizational characteristics, and external threats—notwithstanding the bank’s risk-mitigating controls. Cybersecurity maturity is evaluated in five domains: Cyber Risk Management and Oversight, Threat Intelligence and Collaboration, Cybersecurity Controls, External Dependency Management, and Cyber Incident Management and Resilience...

Monday, 05 October 2015

More call report changes coming soon

Written by Rehmann Team

A round of changes to simplify and reduce the reporting burden on financial institutions was rolled out in March 2015. Now, the FDIC, FRB and OCC are seeking comment on additional proposed revisions that would take effect December 31, 2015, or March 31, 2016, depending on the change. The proposed changes include some additional burden-reducing requirements — good news for financial institutions. However, many of the other proposed changes are expected to have a limited impact on financial institutions as well...

Combine advances in technology, globalization of competition, and consolidation of the industry, and it's more critical than ever that your organization is prepared to take advantage of future opportunities today. With the beginning of a regulatory shift from rule-making to enforcement, financial institutions need to adjust and strengthen their focus on managing key risks to remain compliant. While the most critical risk areas will differ for each institution, here are areas worthy of heightened interest and diligent monitoring. Equal Credit Opportunity Act (ECOA) valuations rule (Reg B) The Equal Credit Opportunity Act (ECOA), enacted in 1974, and its implementing rules (Regulation B) prohibit creditors from discriminating against applicants...

Tuesday, 30 June 2015

Is an ESOP a good choice for your institution?

Written by Rehmann Team

The National Center for Employee Ownership (NCEO) estimates there are approximately 7,000 employee stock ownership plans (ESOPs) covering some 13.5 million employees. Two-thirds of these are used to facilitate the sale of shares of an owner of a profitable, closely held company who is leaving the company; most of the rest are used as a part of an employee benefit plan or as a way to borrow money with beneficial tax consequences. Fewer than 10 percent of ESOPs are in publicly traded companies...

Tuesday, 30 June 2015

Protect electronic data, customer information

Written by Rehmann Team

In late May, the IRS reported an online cyberattack that breached data security and allowed identity thieves to access past tax returns of 104,000 people. The IRS also reported that at least 13,000 fake tax returns have been filed using the stolen information at an estimated loss of approximately $39 million to the government, and, therefore, to taxpayers. The organizations, countries and people purported to be behind the attack have ranged widely from Russia to China to other possible sources around the globe. While the IRS Commissioner John Koskinen maintained the IRS has good security protocols in place and they were simply “taken over by recent events,” the Treasury Department's Inspector General for Tax Administration J...

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