Consumer lending

The private equity firm Caryle is buying a $415 million student loan portfolio from Truist Financial. It's also investing in a nonbank student lender called Monogram that works with banks and credit unions.

As part of a settlement with the Justice Department, Patriot Bank must invest more than $1 million of the total in a loan subsidy fund for minority homeowners and take other corrective steps in its everyday business. The bank denied any wrongdoing.

The delinquency rate that Kroll Bond Rating Agency tracks improved last month but JER's recent Chapter 11 filing and 2024 forecasts suggest it's still under pressure.

COVID-19 largesse enabled subprime borrowers to pay down debt and boost credit scores. Then interest rates rocketed up in 2022, and new subprime auto borrowers felt the pinch.

Funding pressures moderated in recent months, but loan charge-offs climbed. With festering concerns about a vulnerable economy, the potential for elevated credits costs could loom large over the upcoming bank earnings season.

Classes A, B, C, D, E, and F have initial credit enhancement levels of 67.25%, 49.00%, 33.50%, 17.90%, 8.55% and 1.50%, respectively.

The lawsuit accuses Navy Federal of violating the Fair Housing Act and the Equal Credit Opportunity Act after a CNN report that the lender approved a lower percentage of Black and Latino mortgage applicants.

Loans had a FICO score of 753 on a WA basis, an original term of 87 months, an average original balance of about $16,249 and a WA annual percentage rate of about 11.43%.

Decreasing availability of jumbo and non-QM products accounted for most of November's pullback, as other types of loan offerings saw minimal changes, the Mortgage Bankers Association said.

Classes A, B and C benefit from hard credit enhancement levels of 60.80%, 42.80% and 24.57%, respectively, an increase from the comparison deal.

Income-producing loans secured by real estate are under pressure at banks, the government-sponsored enterprises, insurers, and in CMBS to varying degrees.

While Pagaya searches for a permanent successor, the company has named deputy CFO Evangelos Perros as interim CFO. Perros himself was named as deputy CFO in September 2023.

Financial firms claim a proposal by the Consumer Financial Protection Bureau would restrict lending, raise borrowing costs and result in more denials of credit to consumers.

Stress tests suggest systemically important depositories could weather current risks. Meanwhile, single-family arrears remain low, but that business could be impacted.

Ratings analysts say the A1 through A3 tranches benefit from total hard credit enhancement of 43.00% of the deal's initial principal balance, which includes subordination and a non-declining reserve account of 1.00%.

The company is coming off of a recent period of performance improvements, with gains in net income, cash and cash equivalents.

The Cincinnati-based bank, which purchased a solar lender last year, is facing an investigation from 17 state attorneys general over the acquired company's lending practices and contractor network. One solar panel installer has gone bankrupt and faced complaints across the country.

Consumers under the age of 50 held $9.5 trillion in debt last quarter compared with $9.3 trillion in the second quarter. The increase was the most since the final quarter of 2022.

The deal also includes exchangeable notes, initial over-collateralization of 1.00%—that can build to a target of 100%, and a reserve account funded at about 1.50% of the pre-funded pool balance.

The San Carlos, California, consumer lender said it's "exploring strategic options" for its credit card portfolio, discontinuing its investment and retirement products and sunsetting a partnership with Sezzle in addition to embarking on a new round of job cuts.