Bank of America Corp.'s board has been told the company could face a public enforcement action if banking regulators aren't satisfied with recent steps taken to strengthen the bank, according to a report by Dow Jones.
Dow Jones quoted sources “familiar with the situation.”
BofA is the nation's largest residential servicer and third largest home originator, though it continues to scale back significantly in both those areas.
A bank spokesman told ASR sister publication National Mortgage News (NMN) on Monday that it is in the process of reviewing its warehouse lending accounts and plans to shift over some of those relationships to its Merrill Lynch division.
As reported in NMN, dozens of the bank's top loan officers have left the company over the past year, accepting new positions with competing lenders. LOs have complained that a bank policy of demanding two audits on certain new originations is slowing production times significantly and causing customers to leave.
The bank has said that it is aware of the slow processing times and is trying to fix the situation.
Dow noted that BofA has been operating under a memorandum of understanding since May 2009, following repeated disputes with regulators over the purchase of securities firm Merrill Lynch and a downgrade of the company's confidential supervisory rating.
