What We're Hearing

CitiFinancial, the nonbank arm of Citigroup, today agreed to pay a record $1.25 million fine for not correctly reporting its origination data to the Federal Reserve via the Home Mortgage Disclosure Act for the years 2004 to 2007. But what's so fascinating about all this is that CitiFinancial -- formerly known as Commercial Credit of Baltimore -- is still alive at all. Commercial Credit was the subprime residential arm of the old Travelers -- Sandy Weill's Travelers. (Remember when Glass-Steagall was ripped down in the late 1990s? Immediately thereafter, Citigroup and Travelers merged.) Any way, CitiFinancial, a nonbank, is still around though its not making subprime mortgages anymore. And it's not using loan brokers either. So, what type of loans is CitiFinancial making? Answer: home equity, personal loans, and even firsts. Go figure...