Feds Target B&C Mortgage Subs

The federal regulators are targeting a few subprime mortgage subsidiaries of bank and thrift holding companies for special consumer protection compliance reviews in the fourth quarter.The feds plan to coordinate with state regulators so the state-licensed mortgage brokers working with those mortgage subsidiaries also come under scrutiny. "Additionally, the states will conduct coordinated examinations of independent state-licensed subprime lenders and their associated mortgage brokers," the agencies said. The Federal Reserve Board, the Office of Thrift Supervision, and the Federal Trade Commission, along with the Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators, are participating in the pilot program. The nonbank subsidiaries of holding companies are generally overlooked in the examination process. "At the conclusion of the reviews, the agencies will analyze the results and determine whether the project is to be continued," the regulators said.