Accounting standards

The legislation would let banks postpone the start date of the Current Expected Credit Losses accounting standard and delay categorizing pandemic-related loan modifications as troubled debt restructurings.

Two bills — one providing relief from a loan accounting standard and another extending forbearance measures — would collectively contain credit losses.

While Freddie Mac stabilized liquidity in mortgage markets, coronavirus-related credit losses drove the GSE's income down in the first quarter of 2020.

Measures that delay the Current Expected Credit Losses standard and reduce a community bank capital ratio are temporary, but the industry now sees an opening to argue that they should be permanent.

The $2 trillion deal passed by the Senate late Wednesday would aim to put banks and consumers alike on stronger financial footing as they weather the coronavirus pandemic.

Fannie Mae's current tack could help it weather some of the new challenges confronting the government-sponsored enterprises, including the planned expiration of its qualified mortgage rule exemption and rate-driven earnings volatility.

Freddie Mac will keep building on the financial reforms that produced profitability during conservatorship as broader government-sponsored enterprise proposals take shape, according to departing CEO Don Layton.

Fannie Mae is considering sharing more risk with the private sector to reduce future strain on its earnings from the implementation of the Current Expected Credit Loss accounting standard next year.

Fannie Mae and Freddie Mac may need to tap into U.S. Treasury funds when they adopt CECL, a new accounting rule that makes companies set aside money upfront for expected loan losses.

Powell downplayed fears about subprime auto lending, saying he aims to improve Santander Consumer's compliance culture, beef up customer services and expand its relationship with Chrysler Capital.