Government

Treasury Secretary Jack Lew announced an extension of the MHA program for at least one year and a new effort to help jump-start the private-label securities (PLS) market. To determine what can be done to encourage new PLS investment, the Treasury Department will be hosting a series of meetings with investors and is publishing a request for comment in the Federal Register.

FDIC announced Friday the closure of yet another insured bank, bringing the count up to 12 in the year's first half. The Oklahoma State Banking Department shut down Freedom State Bank over the weekend, closing the book on an institution described by FDIC in early May as "critically undercapitalized."

As the U.S. economy continues to improve, the challenges facing the banking industry gradually shift from recovery to risk management in an effort to avoid the pitfalls that contributed to the financial crisis, the Office of the Comptroller of Currency (OCC) said in its Semiannual Risk Perspective for Spring 2014. OCC warned that banks' boards of directors and senior managers should monitor heightened exceptions to traditional underwriting standards.

A new report from the inspector general for the Federal Housing Finance Agency (FHFA) urges the agency to "assess the merits of litigation" in dealing with servicers and providers accused of abusing lender-placed insurance practices. In 2012, lender-placed insurance issues cost Fannie Mae and Freddie Mac a combined $360 million, the report says.

In its third and final estimate of first-quarter growth, the Department of Commerce recorded an annualized 2.9 percent decline in GDP throughout the year's first months. While analysts expected GDP growth to shrink further following the last estimate of a 1.0 percent decline, the reported number represents a sharper downturn than the 1.8 percent contraction that had been forecast.

Overall refinance volume rose slightly in April, but remained at levels more comparable to those seen in 2008, according to the latest from FHFA. Roughly 20,000 refinances were completed through the Home Affordable Refinance Program (HARP) in April, bringing total HARP refinances to approximately 3.2 million since the program's inception.

The Federal Housing Finance Agency (FHFA), functioning as the conservator for Freddie Mac, announced a $99.5 million settlement with RBS Securities, Inc. The settlement resolves alleged violations of federal and state securities law in connection with private-label mortgage-backed securities (PLS) purchased by Freddie Mac during 2005 to 2007.

The list of 2014 bank collapses grew into the double digits over the weekend as River Valley Bancorp was forced to close two of its subsidiary operations. In separate releases issued Friday, FDIC announced the shuttering of Valley Bank branches in Moline, Illinois, and Fort Lauderdale, Florida, bringing the 2014 bank failure tally to 11 so far.

HUD issued a new Mortgagee Letter warning lenders participating in the FHA's reverse mortgage program against using deceptive advertising regarding the program. FHA Commissioner Carol Galante explained the guidance "is intended to make sure lenders know we're keeping a watchful eye on their marketing and advertising practices that might steer borrowers toward reverse mortgage options that limit their available choices."

A week after appearing before the Senate Banking Committee, Consumer Financial Protection Bureau (CFPB) Director Richard Cordray traveled back up the hill again on Wednesday to review the bureau's semi-annual report and take questions from the House Financial Services Committee. At the hearing, committee members asked Cordray to address a number of issues surrounding the embattled agency.