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» VISIT US ONLINE @ DSNEWS.COM 13 COMPTROLLER OF THE CURRENCY DISCUSSES REGULATORY COMPLIANCE AND BURDENS FACING BANKS Comptroller of the Currency omas Curry discussed the challenges banks are facing with regulatory compliance and the regulatory burdens faced by smaller institutions in a speech before the New England Council in Boston, Massachusetts, in July. Curry said financial institutions became subject to "numerous regulatory requirements" addressing financial stability that were written into the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010. ose regulations also address certain consumer protection issues that the crisis brought to light, according to Curry. While acknowledging banking has always been among the most heavily regulated industries, Curry said the impact of the new (and and in some ways tougher) regulations can be felt at financial institutions in two different ways: e regulations bring on the risk that banks will damage their reputations and subject themselves to regulatory penalties if they happen to run afoul of the regulations. Banks are devoting time and resources toward regulatory compliance, which prevents those resources from being used to serve their customers and communities. Community banks and smaller institutions, where the compliance officer will have multiple responsibilities, will be impacted by this the most. Noting the legal as well as practical responsibility federal banking agencies have to minimize unnecessary regulatory burden, Curry pointed out the OCC is currently engaged in a federally-mandated regulatory review (by the Economic Growth and Regulatory Paperwork Reduction Act of 1996). "In this collaborative interagency process, the OCC and other federal banking agencies are conducting outreach meetings around the country to collect comments from bankers and concerned members of the public about our regulations," Curry said. "In May, I joined several of my colleagues here in Boston, where we learned a great deal from participants about specific regulations that are outdated, unnecessary, or needlessly burdensome." e public benefits most regulations provide outweigh the burdens they impose, Curry said. e challenge regulators are facing is "balancing the benefits of regulation against its burdens where Congress has not already made that judgment." OCC TERMINATES FORECLOSURE- RELATED CONSENT ORDER FOR ONEWEST e Office of the Comptroller of the Currency (OCC) announced the termination of the 2011 foreclosure-related consent order for OneWest Bank, having determined the bank satisfied the terms of the consent order. OneWest was one of 12 mortgage servicers penalized by the OCC and the Office of rift Supervision (OTS) in April 2011 for deficient mortgage servicing and foreclosure practices. e OCC handed down enforcement actions against Bank of America, Citibank, HSBC, JPMorgan Chase, MetLife Bank, PNC, U.S. Bank, and Wells Fargo. e OTS penalized Aurora Bank, EverBank, OneWest Bank, and Sovereign Bank. e consent orders handed down against the servicers were based on findings by an examiner during an interagency review of major mortgage servicers conducted during Q 4 2010, at the height of the foreclosure crisis. e OTS reported at the time of the consent order in 2011 that OneWest serviced a portfolio of approximately $141 billion in residential mortgage loans. At the same time the OCC announced the termination of OneWest's consent order, the agency announced it granted approval for the Pasadena, California-based bank to merge with CIT Bank, which is based in Salt Lake City, Utah. e name of the new merged bank will be CIT Bank, N.A. OneWest was one of eight national banks included in the OCC's Q1 2015 Quarterly Mortgage Metrics Report released in late June. e OCC reported the percentage of performing first-lien mortgages at the eight banks had increased from 93.1 to 94.2 percent year-over-year and foreclosure activity had declined during that same period by more than 30 percent to just less than 300,000 loans. OCC RELEASES COMMUNITY REINVESTMENT ACT EVALUATIONS FOR 33 FINANCIAL INSTITUTIONS e Office of the Comptroller of the Currency (OCC) released in August a list of Community Reinvestment Act (CRA) performance evaluations for 33 financial institutions. e list includes evaluations that became public in July and includes national banks, federal savings associations, and insured federal branches of foreign banks that have received ratings, according to the OCC. Out of the 33 evaluations released in early August, six of the institutions received ratings of "outstanding": First National Bank South of Alma, Georgia; First Newton National Bank of Newton, Iowa; Chinatown Federal Savings Bank of New York, New York; First FS & LA of Newark, Ohio; e Peoples National Bank of Checotah, Oklahoma; and First Federal of Northern Michigan of Alpena, Michigan. Twenty-five institutions received a rating of "satisfactory" for their CRA evaluations; and two institutions, Eastern Savings Bank FSB of Hunt Valley, Maryland, and First FS & LA of McMinnville, Oregon, received "needs to improve" ratings. None of the 33 received a substantial noncompliance rating. e CRA was enacted by Congress in 1977 and revised in both 1995 and 2005. e purpose of the CRA is to "encourage depository institutions to help meet the credit needs of the communities in which they operate, including low-and moderate-income neighborhoods, consistent with safe and sound operations," according to the U.S. Federal Reserve Board website. The number of homes with a mortgage either 30 days or more overdue or in foreclosure nationwide in June 2015, a decline of 85,000 from May and 651,000 from the previous June. Source: Black Knight Financial Services STAT INSIGHT 3.18 million

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