TIAA Bank Eliminating Retail Lending Via Branch Network

TIAA Bank plans to eliminate the branch-based retail home-lending business—and concentrate on originating home mortgage loans through existing digital mortgage capabilities.

“We understand that borrowers today need fast, convenient and cost-effective solutions,” said Blake Wilson, chairman and chief executive officer of TIAA Bank. “The changes we’re making will enable us to deliver

[caption id="attachment_10244" align="alignleft" width="150"]Blake Wilson, chairman and chief executive officer of TIAA Bank Wilson: Eliminating retail, to focus on direct and  correspondent channels.[/caption]

mortgage solutions to even more people, using digital technologies that enable clients to work with us efficiently and easily, anywhere and at any time.”

As part of the strategic realignment, TIAA Bank has reached an agreement with U.S. Bank that will allow U.S. Bank to extend offers of employment to a number of experienced TIAA Bank staff and assume the leases on TIAA Bank’s retail home lending offices in some markets across U.S.

TIAA Bank will exit the remainder of its retail branch home lending offices as it focuses on serving clients using its existing retail-direct and correspondent lending businesses.

For TIAA Bank clients with pending home mortgage loans or applications in process, TIAA Bank loan officers will continue to provide hands-on, individual service throughout the process. Clients with home mortgage loans serviced by TIAA Bank will not be impacted by the changes.

TIAA Bank serves home lending clients in all 50 states and the District of Columbia, providing a wide range of residential mortgage products including home-purchase loans and home equity lines of credit. As the banking unit of TIAA, the nation’s leading provider of financial services to the not-for-profit sector, TIAA Bank also serves nearly five million TIAA participants and their families, and more than 15,000 non-profit institutions.


S&P-Experian: Credit Default Rates Stable in January 2019

The composite S&P/Experian Consumer Credit Default Indices rate rose one basis point from last month to 0.90 percent.

The bank card default rate rose eight basis points to 3.42%. The auto-loan default rate fell four basis points to 0.99%. The first mortgage default rate was two-basis points higher at 0.69%. The indices represent a comprehensive measure of changes in consumer credit defaults.

Three of the major metropolitan statistical areas showed higher default rates compared to last month. The rate for Miami increased 26 basis points to 2.19 percent while the rate for Dallas rose four-basis points to 0.89 percent. The default rate for New York was up three-basis points to 0.99 percent. The rate for Chicago was unchanged at 0.88 percent, while the rate for Los Angeles decreased three-basis points to 0.49 percent.

S&P/Experian Consumer Default Composite Indices (by MSA)

Statistical Area
January 2019
Index Level
December 2018
Index Level
January 2018
Index Level
New York 0.99 0.96 0.95
Chicago 0.88 0.88 1.23
Dallas 0.89 0.85 0.87
Los Angeles 0.49 0.52 0.77
Miami 2.19 1.93 1.27
Source: S&P/Experian Consumer Credit Default Indices
Data through January 2019

Following a month where default rates for all loan types increased, the January 2019 data shows default rates little changed from the prior month. The longer-term trend shows that default rates have stabilized. The composite rate has fluctuated within a narrow band, and the last time this rate was more than 10 basis points off of the current level was nearly four years ago in March 2015.

The table below summarizes the January 2019 results for the S&P/Experian Credit Default Indices (non-seasonally adjusted)

S&P/Experian Consumer Credit Default Indices
National Indices
Index January 2019
Index Level
December 2018
Index Level
January 2018
Index Level
Composite 0.90 0.89 0.95
First Mortgage 0.69 0.67 0.72
Bank Card 3.42 3.34 3.57
Auto Loans 0.99 1.03 1.07
Source: S&P/Experian Consumer Credit Default Indices
Data through January 2019

“Despite continuing uncertainty about economic policy, two factors favorable to the economy persist: low inflation and a strong labor market," said David M. Blitzer, managing director and chairman of the index committee at S&P Dow Jones Indices. "These trends should support the economy and limit any increase in consumer credit default rates. The risks facing the economy in the first half of 2019 are in trade where tariffs or Brexit could upset things, and in the financial sector where worries about corporate earnings and anxiety of possible Fed rate hikes could spook the markets.”




MISMO Unveils Remote Online Notarization Standards

MISMO has released remote online notarizations standards for a 60-day public comment period—in a bid to ensure lenders avoid the inefficiency of dozens of state-level protocols.

The aim is for the standards to face a rigorous review from organizations and industry participants—that demonstrates the standards are ready for broad use across the mortgage industry. Once the comment period is completed, the standards could be elevated to Candidate Recommendation status.

Over the past few years, a number of states have enacted laws allowing the use of audio-visual communication devices to notarize documents in real-estate transactions. These devices have provided borrowers, homebuyers and sellers the convenience of signing their closing papers online from a remote location.

At the same time, the mortgage industry asked MISMO to develop standards to promote consistency across the states that passed RON legislation. MISMO's RON standards enable states to adopt consistent practices that make it possible for lenders and other industry participants to adopt new procedures to meet consumer demands for convenience and an improved experience. The comment period will remain open from Feb. 19 to April 22, 2019.

[caption id="attachment_10197" align="alignright" width="310"] Oddo: Aim is to facilitate common "processes, procedures and technology requirements."[/caption]

“As new state laws legalizing remote online notarizations are passed and await implementation, MISMO’s remote online notarization standards provide a blueprint for regulation that secretaries of state can use to expedite the development of draft regulations,” said Eddie Oddo, vice president of corporate business solutions at First American Title Insurance Co. “The proposed standards are designed to enable all mortgage industry participants, including various state officials, to adopt standard processes, procedures and technology requirements for implementing remote online notarizations which will promote consistency nationwide.”

The new standards include credential analysis, borrower identification, capturing and maintaining a recording of the notary process electronically, audio and video requirements, record storage and audit trails. MISMO is communicating with secretaries of state across the U.S. to encourage the adoption of the standards in their respective regulations. Uniformity of regulations benefits all parties that might use RON services, from lenders to notaries to consumers.

In addition to creating standards, the MISMO Remote Online Notary Workgroup is developing best practices, implementation guides and other educational materials to help industry participants leverage the standards in their businesses.

The comment period is also intended to afford work group participants who worked on the proposed RON standards at least 30 days’ notice prior to final release of the standards to review them and disclose any applicable Patent Rights, as defined by MISMO’s 2018 Intellectual Property Rights Policy.

The Mortgage Bankers Association and the American Land Title Association collaborated to prepare model legislation that provides the framework for any state to adopt a RON process.


Arch Reported $121M Net Income

Arch Capital Group Ltd. reported net income of $126.1 million, or $0.31 per share, a 5.9% annualized return on average equity, compared to $203.5 million, or $0.49 per share, for the 2017 fourth quarter.

Pre-tax current accident year catastrophic losses, net of reinsurance and reinstatement premiums were $118.2 million, primarily related to Hurricane Michael and the California wildfires.

The 2018 fourth quarter loss ratio reflected six points for current year catastrophic activity, primarily related to Hurricane Michael and the California wildfires, while the 2017 fourth quarter loss ratio reflected a benefit of 1.3 points due to reserve releases in the quarter from 2017 third quarter hurricanes.

Gross premiums written by the mortgage segment in the 2018 fourth quarter were 6.8% higher than in the 2017 fourth quarter, while net premiums written were 13.5% higher. The growth in gross premiums written primarily reflected an increase in U.S. insurance in force and government sponsored enterprise credit-risk sharing transactions, partially offset by a lower level of U.S. single premium business and a decrease in Australian mortgage reinsurance business.

The increase in net premiums earned for the 2018 fourth quarter primarily reflected the growth in insurance in force in the U.S. over the past 12 months. Insurance in force increased to $383.7 billion at December 31, 2018, compared to $351.8 billion at Dec. 31, 2017.

Arch MI U.S. generated $16.7 billion of new insurance in the 2018 fourth quarter, compared to $14.4 billion in the 2017 fourth quarter, as a higher level of purchase market activity more than offset a reduction in refinance market activity.






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