The House Financial Services Committee has voted 65-5 to approve a bill that establishes a strong, independent regulator to oversee Fannie Mae, Freddie Mac, and the Federal Home Loan Banks.Committee Chairman Michael Oxley succeeded in getting a bipartisan vote by raising the conforming loan limit in high-cost metropolitan markets and by requiring Fannie and Freddie to contribute 5% of their after-tax profits to a new affordable housing fund. The new regulator has the power to increase Fannie's and Freddie's minimum capital requirements or place a financially troubled government-sponsored enterprise in receivership, if necessary. However, the bill falls short of providing the new GSE regulator with explicit authority to reduce the size of Fannie's and Freddie's giant mortgage portfolios, as requested by the Bush administration. This omission prompted several Republican members to vote against the bill. The regulator can order a GSE to reduce the size of its portfolio for safety-and-soundness reasons, and Rep. Barney Frank, D-Mass., argued that this language does not tie the regulator's hands until there is a crisis. "The fact is, this is a very powerful regulator," Rep. Frank said. "He has powers specifically to adjust the portfolios and also to raise capital."
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A federal judge in Texas dismissed the Consumer Financial Protection Bureau's medical debt rule and prohibited states from passing their own laws prohibiting medical debt on credit reports.
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Dr. Mark Calabria takes on the additional role of chief statistician of the United States; retired Ally Bank executive Diane Morais has joined First Citizens Bancshares' board of directors; MainStreet Bank has promoted Alex Vari to chief financial officer; and more in this week's banking news roundup.
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While refinances are behind the latest increases, the pace of purchase activity may be a stronger indicator of where the housing market sits.
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The share of economists expecting a September rate reduction grew in the July Wolters Kluwer survey, but the October or later percentage also increased.
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Rising home prices and softening sales offer a mixed view of a market that some say is shifting to favor buyers.
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The notes are backed by home improvement installment loans originated by approved dealers in Foundation Finance Company's network.
July 11