Risk management

The regional bank announced a leadership shakeup on Wednesday, capping a tumultuous week in which shareholders became spooked about its exposure to the commercial real estate sector.

Former Flagstar CEO Alessandro DiNello, who had been New York Community's nonexecutive chairman, was named executive chairman after the Long Island bank's stock price fell by more than 59% in a week. New York Community also issued updates on both its deposit situation and its search for a new chief risk officer.

A common concern in housing finance reactions has been the lack of accommodation for strategies routinely used to manage credit, rate and liquidity exposures.

FHA-insured and Department of Veterans Affairs-guaranteed mortgages bear watching next year, according to Intercontinental Exchange.

While a majority of current forborne borrowers sought relief for reasons related to COVID-19, servicers are seeing a growing share of cases involving natural disasters or personal financial issues, the Mortgage Bankers Association said.

For large banks, the agencies wanted to go above the global standards for residential mortgages, as well as some business loans, to avoid giving those lenders a competitive advantage over smaller peers, according to another person familiar with the proposal.

Experts and industry leaders said banks are pumping investment into technology that can connect information silos.

Subordinated debt issuances and asset-backed securities have helped institutions of all asset sizes weather recent market uncertainties and fuel campaigns for growth, according to executives and investment experts.

Institutions can borrow against par-valued securities that they would otherwise have to sell at a loss when there's a run on deposits, and it could have effectiveness beyond its actual usage.

Mortgage-backed securities aren't generally considered risky assets, but how SVB managed them contributed to its woes.