Bankruptcy Blogs

Regulators' decision to delay reporting for troubled-debt restructurings should allow banks and credit unions to be more nimble modifying loans impaired by the coronavirus outbreak.

Congressional Democrats want forceful action to prevent damage to millions of Americans' credit scores during the COVID-19 pandemic. But the credit bureaus argue that the tools needed to protect consumers are already in place.

The announcement last week by Freddie Mac, Fannie Mae and other agencies that they will provide mortgage loan forbearance arrangements for up to 6 months, subject to an extension of an additional 6 months, directly impacts mortgage servicers in two significant respects.  First, mortgage servicers have to quickly pivot from a stable mortgage servicing environment to a servicing environment requiring a huge influx of financial resources and people necessary to service a potentially massive number of borrower’s requiring forbearance, loss mitigation and other disaster relief measures.  Second,

“Only when the tide goes out do you discover who’s been swimming naked” – Warren Buffet

The tide has gone out on the municipal finance market.

While much of the discussion about the financial fall-out of the COVID-19 virus has focused on the massive wealth destruction in stock markets and pressure on corporates around the world, the impact on the largest financial market in the world- the $3 trillion US municipal finance market- cannot be ignored. Simply put, the market is imploding.

The attack knocked out core and mobile banking systems at several U.S. banks, and Finastra is working to get them up and running.