Brendan Pedersen

In signing off on deposit insurance for the payments giant and student loan servicer, the FDIC sanctioned the first new industrial loan companies in over a decade.

Nonbanks hold a disproportionate percentage of the worst-rated loans, but banks hold a majority of the market, and risk management safeguards are largely untested, according to an interagency report on shared national credit.

To guard against headwinds in the agricultural sector, the Federal Deposit Insurance Corp. recommended that institutions consider the “overall financial status” of farm loan borrowers.

With fintech firms appearing stuck in neutral in their efforts to seek bank charters from federal regulatory agencies, observers say state licensing options could be in vogue again in 2020.

The board- and management-level handing of CRE concentration was the chief concern of FDIC examiners, making up more than 56% of all the supervisory recommendations regulators made in the two-year period.

In October, U.S. District Judge Victor Marrero ruled against the OCC in a case brought by the New York State Department of Financial Services.

The agency’s semiannual report warned institutions to be mindful of operational risks from the innovation in core banking systems, and detailed supervisory steps to monitor the adoption of a new reference rate.

Alternative data "may improve the speed and accuracy of credit decisions and may help firms evaluate the creditworthiness of consumers," the agencies said.

Fannie Mae and Freddie Mac’s exemption from the Qualified Mortgage rule is on borrowed time, but a House bill would allow lenders to use the mortgage giants’ guidelines for documenting borrower income.

Many in the space are seeking the creation of a "flexible" supervisory regime that relies on existing authorities and a hands-off approach from state agencies, but such a plan faces an uphill battle.