Page 7 - May 23, 2024 Bulletin

aRTiCLeS

The CFPB received more than 1,200 complaints involving mission and update how it evaluates system banks achieving those
credit card rewards in 2023, according to the report. The bureau goals.
analyzed hundreds of complaints and identified what it said were The agency is requesting public input in three categories:
four recurring themes. First, consumers fail to receive rewards updating the regulatory statement of the FHLB system’s
when financial institutions “impose vague or hidden conditions.” mission to better reflect its appropriate role in the housing
Second, consumers lose benefits that they previously earned finance system; developing metrics and thresholds to evaluate
when issuers and merchants devalue rewards. Third, consumers mission achievement; and identifying how the system’s banks
face obstacles in receiving their preferred redemptions when could incorporate incentives for members with a “strong and
companies fail to quickly resolve rewards-related issues. Finally, demonstrable connection” to the FHLB mission.
consumers suddenly lose rewards when issuers unilaterally revoke
previously earned balances. Read more: https://www.fhfa.gov/PolicyProgramsResearch/
Programs/Documents/FHLBank-Mission-RFI-2024.pdf
Read more: https://files.consumerfinance.gov/f/documents/cfpb_
credit-card-rewards_issue-spotlight_2024-05.pdf
Fed Survey: Banks Tighten
Small-Business Owners Policies on Commercial Real
Optimistic About Their Future Estate Lending

Nine out of 10 small-business owners have a positive outlook Banks reported tightening their commercial real estate lending
about the prospects for their businesses over the next 12 months, policies during the first quarter of 2024, according to the Federal
up from 80% a year ago, according to a new survey by TD Bank. Reserve’s senior loan officer opinion survey. The quarterly survey
Nearly two in three (64%) respondents expect their business noted that banks reported tighter standards and weaker demand
revenue and sales to increase in the next 12 months. At the for all types of commercial and industrial loans during the first
same time, more than half (59%) said they plan to expand their three months of the year. But for the most recent survey, the Fed
products and services. Nearly all respondents (94%) said they asked banks “a set of special questions” about CRE lending in
have no plans to sell or close their businesses in the near future. light of recent developments in the marketplace. Banks reported
tighter standards for all CRE lending policies surveyed, including
Still, the survey found that inflation continues to pressure small maximum loan sizes and interest-only payment periods. Banks
businesses. More than half of respondents cited both inflation were also asked about residential real estate, reporting that lending
and interest rates (56%) and the increasing costs of supplies, standards tightened across some categories of RRE while overall
materials and equipment (58%) as top concerns. Roughly two demand for loans was weaker.
in three respondents (64%) said they will have additional credit
or financing needs over the next 12 months. Of that group, C&I: Moderate net shares of banks (10%-20%) reported having
half (50%) said that the loan or line of credit would be used to tightened standards on C&I loans to firms of all sizes. Tightening
maintain company operations, with others saying they would was most widely reported for the maximum size of credit lines,
use the funding to support expansion into new market verticals the costs of credit lines, the spreads of loan rates over the cost of
(47%) and launching a new product or service line (45%). funds and the premiums charged on riskier loans.

Read more: https://stories.td.com/us/en/article/small-business- CRE: Significant net shares of banks (50% or more) reported
optimism-jumps-ten-percent-new-td-bank-survey-shows tightening standards for all types of CRE loans. Meanwhile,
a moderate net share of banks reported weaker demand for
FHFA Seeks Public Input on construction and land development loans, while significant net
Updating FHLB’s Mission shares of banks reported weaker demand for loans secured by
nonfarm nonresidential and multifamily residential properties.
The Federal Housing Finance Agency has issued a request for Mortgages: Modest net shares of banks (5%-10%) reported
input on the mission of the Federal Home Loan Bank system tightening standards for nonqualified mortgage jumbo, non-QM
as the agency considers next steps for related rulemaking. non-jumbo, subprime and QM non-jumbo non-government-
FHFA expects to issue a proposed rule on FHLB‘s mission, sponsored enterprise-eligible mortgage loans. As for demand,
and responses will be considered in the development of that significant net shares of banks reported weaker demand for
rulemaking. subprime and non-QM mortgages, while moderate net shares
FHFA’s recent report, “Federal Home Loan Bank System at 100: of banks reported weaker demand for most other RRE loan
Focusing on the Future,” recommended that the agency clarify its categories. Similarly, a moderate net share of banks reported
weaker demand for home equity lines of credit.

7