Daily Dose

According to a presentation from JPMorgan Chase, mid-size banks should begin merging before the Federal Reserve begins to reverse quantitative easing in December. This policy reversal will essentially "destroy" deposits, the presentation argues, and make it difficult for smaller banks to thrive. Consolidating resources may be the solution.

Fannie Mae and Freddie Mac will now enjoy the nine standard exemptions of the Freedom of Information Act, thanks to a recent amendment to HR 1694. According to the amendment's sponsor, it will help ensure privacy and transparency at the entities. Passed in April, HR 1694 requires the GSEs to adhere to the FOIA for the first time since entering conservatorship.

According to billionaire Warren Buffett, Wells Fargo's CEO John Stumpf should have responded sooner to problems with its sales incentive programs which, Buffett says, were "incentivizing the wrong kind of behavior." The Chairman of Berkshire Hathaway addressed the bank's scandal on Saturday during a Q&A session with shareholders. He also discussed the firm's Q1 report and potential corporate tax cuts.

With traditional lending systems such as banks not meeting the needs of consumers, fintechs and online lending platforms have become a much more valuable resource for investors and consumers. Fintechs can use non-traditional data to underwriting and lending techniques to assess the credit worthiness of loan applicants using online information gleaned from social media, etc., notably loan applicants that may appear as “credit invisible” to other institutions. However, this "alternative data" brings security risks.

Amid cease and desist orders and a federal lawsuit, Georgia-based Ocwen Financial Corp. continues to see support from its service providers, including Altisource. The mortgage services company as been embroiled in legal troubled for years over issues regarding the quality of its mortgages.

In an effort to better serve some persistent affordable housing problems in the U.S. Fannie Mae and Freddie Mac released their proposed Duty to Serve plans. "Duty to Serve presents a welcome opportunity to lead the mortgage industry and help more American families with their housing needs," said Danny Gardner, Freddie Mac's vice president of affordable lending and access to credit. The purpose of the plan is to better serve some persistent affordable housing problems in the U.S.

Under the 1967 Freedom of Information Act, Congress is exempt from requests for records and material, and as Hensarling stated, communications between the Financial Services Committee and various branches of government constitute congressional records. Financial Services Committee Ranking Member Maxine Waters (D-California), criticized Hensarling’s statements.

Following a week of argument within Congress regarding everything from healthcare to the Financial CHOICE Act, on Wednesday at 2 p.m. EST, the Department of the Treasury will release its monthly Federal Budget Statement. The Bureau of Fiscal Service releases a report of the monthly receipts/outlays and deficits/surplus of the United States. This budget announcement comes right on the heels of the first round of votes to move the Financial CHOICE Act forward, a bill which would act as an alternative to the Dodd-Frank Act.

Fannie Mae reported $2.8 billion both net and comprehensive income for the quarter, the exact amount of the dividend amount it expect to pay the Treasury Department in June. But that income for the quarter was nearly half what the GSE reported in Q4 of 2016.

Due to changes in securitization trends, rental property investors are shifting their acquisition efforts toward the Southeastern U.S. The region offers lower acquisition costs and more attractive yields, a new RMBS report found. In 2016, Florida, Texas, Georgia, North Carolina, and Indiana made up the bulk of investments.