If you’re wondering or questioning how the funds have been used for the Troubled Asset Relief Program (TARP), take a look at the Treasury’s Financial Stability web site. The distribution of TARP funds is published several times a month.
Senior financial supervisors from seven countries, known as the Senior Supervisors Group, have issued a report that evaluates how weaknesses in risk management and internal controls contributed to industry distress during the financial crisis.
The report, Risk Management Lessons from the Global Banking Crisis of 2008, reviews in detail the funding and liquidity issues central to the recent crisis and explores critical areas of risk management practice in need of improvement across the financial services industry. The report concludes that despite firms’ recent progress in improving risk management practices, underlying weaknesses in governance, incentive structures, information technology infrastructure and internal controls require substantial work to address.
The report and the transmittal letter to the chairman of the Financial Stability Board, which summarizes the key observations and conclusions of the report, can be found on the New York Fed’s web site.
If you are dealing with customers who are seeing their home equity lines of credit (HELOC) frozen or reduced, you can offer them the Federal Reserve’s latest “5 Tips” guide. The home equity tips guide explains consumers’ rights and lenders’ responsibilities when credit lines are reduced and provides information for those seeking to have a credit line reinstated.
The guide explains that lenders can lawfully reduce or limit a consumer’s line of credit regardless of whether the customer has made timely payments. However, the lender must send a written notice of the action no later than three business days after the freeze or reduction goes into effect. The notice must include information about any other changes to the HELOC.
You can also direct your customers to What You Should Know about Home Equity Lines of Credit.
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