Overall, the banking industry continued to improve in the first quarter of 2014, although banks did see their noninterest income decline due to reduced mortgage activity and a drop in trading revenue, according to the FDIC’s Quarterly Banking Profile for 1Q14.
On March 14, 2014, In the latest development in the long-running saga of the Libor scandal, the FDIC in its capacity as receiver of 38 banking institutions that failed between 2008 and 2011, has filed a massive new lawsuit in the Southern District of New York against the U.S. dollar Libor rate-setting banks…
The US Court of Appeals for the Eleventh Circuit recently issued the first appellate decision holding that, in actions brought by the Federal Deposit Insurance Corporation (FDIC), the officers and directors of failed banking institutions can assert affirmative defenses relating to the FDIC’s post-receivership conduct.
Eleventh Circuit Rejects FDIC’s “No Duty” Argument, Allows Post-Receivership Affirmative Defenses Against the Agency
One of the most contentious issues in the litigation the FDIC has been pursuing in its capacity as receiver of various failed banks is whether the defendant former directors and officers can assert affirmative defenses against the FDIC for the agency’s own conduct.
With the costs of compliance on the rise, we are seeing some significant consolidation in the banking industry, particularly among community banks. In a recent article on www.bankdirector.com, Rick Maroney writes that although bank M&A has been tepid thus far in 2013, some key drivers of M&A activity are starting to emerge and he predicts that we are likely to see increased merger and consolidation activity in the industry as smaller banks need to grow to remain viable.
CFTC: On October 30, the CFTC voted 3-1 to approve a set of final rules to enhance customer protections at commodities brokers. One provision in the Customer Protection Rules changes how Futures Commission Merchants (“FCMs”) calculate the funds (“residual interest”) they must maintain in customer accounts to cover margin deficits.
CFPB: On October 15 the Consumer Financial Protection Bureau (“CFPB”) issued an interim final rule amending certain provisions of its mortgage servicing rules and making technical changes to other January 2013 mortgage rules (“Interim Amendments”).
FDIC Statement Inveighs Against Directors & Officers’ Insurance Exclusions and Coverage for Civil Money Penalties
In an unusual step, the FDIC, the federal regulator responsible for insuring and supervising depositary institutions, has weighed in on financial institutions’ purchase of D&O insurance.
A Georgia court recently held that an insured-vs-insured exclusion in a directors and officers policy precluded coverage for two former officers of a failed bank sued by the FDIC.