The chairman and chief executive officer of the Farm Credit Administration says she would support congressional action to raise Farmer Mac's capital requirements."We do support the General Accounting Office's recommendations to Congress that enhancements are needed in the future," Nancy Pellett told the House Agriculture Committee. "We especially support greater flexibility to set minimum capital requirements for Farmer Mac." A GAO official testified that Farmer Mac has increased it risk profile by making $3.1 billion in standby purchase commitments, which guarantee the performance of specific loan pools that remain on the books of Farm Credit System institutions. The capital requirement in these off-balance-sheet commitments is 0.75%, instead of the 2.75% required for on-balance-sheet assets. "This really does change and increase the risk profile of the Farmer Mac," GAO Director Davi D'Agostino testified. Farmer Mac president and CEO Henry Edelman explained that standby commitments are really a "permutation" of a swap transaction and that they free up equity for the FCS institutions so they can make more loans. "We stand ready to absorb the losses just like a mortgage-backed security," he said.
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The massive mortgage business saw a first quarter profit mitigated by nearly $300 million in hedging losses.
6h ago -
The Consumer Financial Protection Bureau has seen excessive property-inspection charges, fees that loan mods should eliminate and improper line-item labels.
10h ago -
Michael Tannenbaum, whose experience in the financial services industry spans over 15 years, has a track record of helping companies scale and grow.
April 24 -
A majority of consumers earning more than $100,000 annually said they were concerned about their own ability to purchase a home, demonstrating how affordability issues are impacting those at many socioeconomic levels, the University of Michigan study found.
April 24 -
The nonbank's results add to other indications that the first quarter's "higher for longer" rate scenario had an upside for efficient servicing operations.
April 24 -
The latest rate increases contributed to a 1% drop in purchases from the previous week and 15% annually, according to the Mortgage Bankers Association.
April 24