Insights from Boardman Clark's Banking Group.
The FDIC recently issued its new final rule on the definition of “deposit broker” and “brokered deposit”. With PPP and other issues facing banks, it’s easy enough to not pay attention to this rule. The final rule will take effect on April 1, 2021, with some delayed compliance permitted to January 1, 2022.
As part of the CARES Act the Federal Reserve Bank of Boston has established a special purpose vehicle (SPV) that will purchase a 95% participation in certain qualifying term loans originated by financial institutions. The terms of the loans have been written about elsewhere so we won’t reiterate them here (but would be happy to discuss them with you if you have questions). We recently helped Starion Bank with loan documents for a Main Street Priority Loan that the SPV purchased. It was the SPV’s first purchase in the country. Here are some lessons for those considering making a loan under the Main Street Lending Program umbrella:
The Consumer Financial Protection Bureau (“CFPB”) has amended Regulation X to temporarily allow mortgage servicers to offer borrowers who are experiencing financial hardship as a result of the COVID-19 pandemic certain loss mitigation options without obtaining a complete loss mitigation application.