Securitization – Consumer Financial Services Watch

Treasury Reports Continue to Inform Dodd-Frank Reform Efforts

Oct 31 2017

By Daniel F. C. Crowley, Bruce J. Heiman, William A. Kirk, Karishma Shah Page, Eric A. Love, Dean A. Brazier

On October 26, 2017, the U.S. Department of the Treasury (the “Treasury”) released a report entitled “A Financial System That Creates Economic Opportunities: Asset Management and Insurance,” the third in a series of reports that President Trump’s Executive Order 13772 on Core Principles for Regulating the U.S. Financial System (the “Core Principles”) requires Treasury to issue about potential ways to legislatively and administratively reform the U.S. financial system, consistent with the Core Principles. Earlier this month, Treasury released its second such report, which outlined recommendations concerning the capital markets. Treasury’s first report on banks and credit unions was released in June 2017 (See K&L Gates Alert: Dodd-Frank Reform; What Comes Next?), and one additional report is expected to be released in the near future. Treasury’s recommendations are likely to inform the efforts currently underway in Congress to advance financial regulatory reform legislation. This alert highlights a number of notable recommendations contained in the asset management and insurance report, as well as the capital markets report.

To read the full alert, click here.

Securitization developments for Alternative Finance

Dec 01 2016

K&L Gates partner Anthony Nolan will be speaking on “Securitization in Alternative Lending” at the Marketplace Lending & Alternative Financing Summit 2016 in Dana Point, California, on December 5th. This session will bring together participants with various perspectives, including investment bankers, platform representatives and service providers, in addition to Nolan’s viewpoint as a U.S. securitization and fintech lawyer. They will address recent commercial and regulatory developments that may affect the securitization of online and marketplace loans which include the impact of risk retention, which becomes effective on December 24, the implications of rating agency reform, emerging standards for asset-level representations and warranties, and the prospects for reform or rollback of Dodd-Frank consumer financial services regulation following President Trump’s inauguration in January.

The Marketplace Lending & Alternative Financing Summit is an educational forum for financial services professionals to delve into industry topics and trends to maximize returns and reduce risk in the growing field of marketplace lending. It brings together some of the thought leaders and market movers within the marketplace lending & alternative financing industry. Topics will include legal, tax and structural considerations, rating agency methodology, and information and tools for attendees to keep up with this dynamic industry. To see the agenda for the conference, please click here.

Eminent Enabler: Congress Prohibits HUD and Ginnie Mae from Facilitating Local Government Seizure of Mortgage Loans

Dec 22 2014

By: Laurence E. Platt

At least for the next year, Congress has materially impaired the ability of local governments to seize underwater residential mortgage loans through eminent domain by cutting off federal insurance or guarantees to refinance the seized mortgages and then securitize the refinancings. Without this federal “take out” through mortgage insurance provided by the Federal Housing Administration (“FHA”), and guarantees of mortgage-backed securities by the Government National Mortgage Association (“Ginnie Mae”), local governments will have to find private sources of long-term funding to pay for loans that they attempt to seize.

New York Department of Financial Services Unveils “New Cyber Security Examination Process”: Five Key Takeaways

Dec 18 2014

By: András P. Teleki, Andrew L. Caplan

On December 10, 2014, Superintendent Benjamin Lawsky of the New York Department of Financial Services (the “DFS”) announced a “New Cyber Security Examination Process” (the “New Examination Process”) for New York-chartered and licensed banking institutions (“Regulated Entities”). Pursuant to the New Examination Process, the DFS will expand its information technology (“IT”) examination procedures to focus more attention to cybersecurity, and will schedule these IT/cybersecurity examinations following each institution’s comprehensive risk assessment. Even if you are not a financial institution regulated by the DFS, the key takeaways discussed below provide insight into the types of questions regulators are asking with respect to cybersecurity practices and offer practical guidance for assessing the framework of a cybersecurity compliance regime.

The New Examination Process includes both sample examination topics and information requests that the DFS will use in future examinations. A review of these topics and information requests provides understanding of the DFS’ cybersecurity expectations for Regulated Entities, as well as practical cybersecurity considerations for financial institutions not regulated by DFS. Below we discuss five key takeaways related to the New Examination Process.

To read the full alert, click here.

K&L Gates Announcement: K&L Gates Receives Top Rankings in BTI’s Litigation Outlook Survey

Oct 03 2014

K&L Gates has been ranked as one of three top law firms as a “Powerhouse” in Class Action and Torts Litigation for the second consecutive year. The firm was also named as a “Standout” in Securities and Finance Litigation, Complex Commercial Litigation and Routine Commercial Litigation in BTI Consulting Group’s 2015 Litigation Outlook survey.

In addition, the firm was once again included in BTI’s “Honor Roll of Most Feared Law Firms” listing as well as on the honor roll of firms noted by clients for IP Litigation.

The rankings were based on direct client feedback from more than 300 interviews with general counsel and in-house litigation counsel from a wide array of industries.

Click here to read the press release on our rankings.

Non QM Lending Facilitated by New Fitch Ratings Criteria

Mar 18 2014

By: Laurence E. Platt

Non-QM lending received a big boost this week when Fitch Ratings issued its criteria for analyzing residential mortgage-backed securities (“RMBS”) under the Ability to Repay (“ATR”) and Qualified Mortgage (“QM”) rules issued by the Consumer Financial Protection Bureau. It announced that it would apply a relative “credit enhancement” adjustment (i.e., extra collateralization) to non-QM loans pooled to back RMBS, but the level of credit enhancement reflects its belief that the risk of massive losses on such loans is relatively slight. In reliance upon required third-party due-diligence reviews, Fitch said that it would assume the accuracy of an originator’s designation of loans as “safe harbor” QM loans, higher-priced QM loans or non-QM loans. Read More

Catagory:Securitization