Most people hate getting older, but during the month of May getting older is how you get into the party. May is Older Americans Month where it is a time to celebrate those 65 and older through ceremonies, events and public relations. Let's hear some stats about older Americans; should I increase the font size? Every reverse mortgage lender knows that there are 46.2 million "older Americans" in the United States which compromises 14.5% of the total population. And the population of people 65 and older is projected to more than double by 2060 to 98.2 million. On top of that, 2033 is the first year ever that the population 65 and older would outnumber people younger than 18 in the U.S.

FinTech, and non-banks, certainly have been gaining a lot of attention. But there are a lot of changes going on in the banking world as well. The Federal Reserve has increasingly approved bank mergers, particularly acquisitions by midsize banks. The central bank approved 279 mergers in 2015, compared with 190 in 2013. "I think we're going to see the Fed OK a lot of consolidation activity up to a particular size. After a certain size, the line gets drawn and the biggest banks aren't going to be able to acquire any depository institutions," said Bert Ely, banking analyst at Ely & Co. Too small to comply?

U.S. banks are making more mortgage loans, and keeping the jumbo loans on their books. The share of outstanding mortgage debt held by U.S. banks is up roughly 32% - the highest it has been since early 2009. A sizeable chunk of this comes from Chase holding its jumbo loans in its portfolio - no need to sell off those assets in securities at this point. Heck, many banks have plenty of deposits looking to be put to work, and the credit risk profile of jumbo loans currently fits in well.

Regional banks are likely to benefit from the Basel Committee on Banking Supervision's decision to abandon its internal-models approach for capitalizing credit valuation adjustment risk, as the creation of internal models would have proven too expensive for smaller institutions. Standardized risk models provide a simpler framework but do not provide nuanced risk assessments, experts say.

CNBC reports big banks have ramped up plans to modify and eliminate branches in their networks. Among some of the changes: Bank of America has launched digital bars at branches (to teach customers how to use digital offerings and free up staff to sell more lucrative products); JPMorgan is closing branches (the bank reports teller transactions in branches have declined by more than 100mm over the past 3Ys); and Citibank has reduced branch sizes to 600sf from 1,200 prior.

Thank you to Ken S. who passed along this story from The Atlantic titled, "Who Can Go After Banks for the Foreclosure Crisis?" Some might ask, "Why not sue the former homeowner? If fraud was involved, like occupancy misrepresentation, the former owner should be held responsible - blaming only the banks is very unfortunate." Cities are arguing that they, too, were damaged by risky loans, and that they should be able to take the lenders to court to regain their losses.

How many banks are there in the United States? Roughly 6,000, down almost 1,500 banks, or about 19%, from 2010. Regulators have approved only 2 new banks since 2011 (versus about 100 average every year since 1990). But there is hope: the FDIC recently announced it will change the de novo period from 7 years (post crisis) back to 3 years (pre-crisis).

Global Market Intelligence analysis finds there were a net 289 bank and thrift branch closures in Q1, taking the total count down to 92,639 nationwide. This compares to -323; -589 and -436 net closures respectively for the prior 3 quarters. For the second time this year a credit union has announced a bank purchase: Royal Credit Union ($1.8B, WI) will acquire Capital Bank ($36mm, MN). KeyBank ($93B, OH) will sell 18 NY branches to Northwest Bank ($9.0B, PA) for a 4.5% deposit premium. Northwest captures $1.7B in deposits and $511mm in loans as part of the deal and Key took the action to resolve antitrust concerns around its First Niagara acquisition.

Your Community Bankshares, Inc. (New Albany, IN) has agreed to merge with WesBanco, Inc. (Wheeling, WV). In Montana Glacier Bank ($9.1B) will acquire Treasure State Bank ($71mm) for about $12.9mm in cash and stock, or roughly 1.3x tangible book. In Florida Stonegate Bank ($2.4B) will acquire Regent Bank ($362mm) for about $40mm in stock (100%) or about 1.4x tangible book. In Illinois the Federal Savings Bank ($285mm) will acquire mortgage servicing firm ICC Mortgage Services, and First Mid-Illinois Bank & Trust ($2.1B) will acquire First Clover Leaf Bank ($655mm) for about $90mm in cash (25%) and stock (75%). Pacific Continental Bank ($1.9B, OR) will acquire Foundation Bank ($443mm, WA) for about $67.1mm in cash and stock. Bank of the Cascades ($2.5B, OR) will acquire Prime Pacific Bank ($120mm, WA) for about $17.1mm in stock.

In Indiana State Bank of Lizton ($363mm) will acquire Indiana Business Bank ($68mm) for about $12.5mm in cash. Texas' Citizens State Bank ($780mm) will acquire First Bank & Trust Co ($39mm). In Nebraska Security State Bank ($193mm) will acquire loan broker Metropolitan Building and Loan Association. The industry learned that in California Mechanics Bank ($3.6B) will acquire California Republic Bank ($1.7B) for about $329mm in stock, and Central Valley Community Bank ($1.3B) will acquire Sierra Vista Bank ($156mm) for about $24mm in cash (46%) and stock (54%) or about 1.23x tangible book.

But all is not vows and wedding bells in the banking world. Old National Bank ($11.9B, IN) said it will exit its insurance business and sell the operations to national insurance distribution platform player Prime Risk Partners (GA) for a reported $93mm. And Trust Company Bank, Memphis, Tennessee, $20.7 million in assets, was closed by the Tennessee Department of Financial Institutions and a nod was given to The Bank of Fayette County, Piperton, Tennessee, with $374 million in assets, to assume all of the deposits.

Up a little, down a little, so go rates. As noted yesterday, using the yield on the U.S. 10-year T-note as a proxy, for much of 2016 its yield has ranged between 1.98% (early March) and a low of 1.70% set in late February - very stable. The usual suspects have been supplying agency mortgage-backed securities into the market, and the usual suspects have been buying them. Steady as she goes. But yesterday was quite a rally, and on no real news in the US although we saw weakening Chinese manufacturing data, rate cuts in Australia, and negative European growth outlooks. The 10-year note ended the day better by over .5 to yield 1.80%, and agency MBS prices were better by about .250.

Today we have more news upon which to chew. (That doesn't sound right, but it is grammatically correct.) The MBA told us what retail applications did last week. (The overall index for last week was -3.4% following a drop of 4.1% the week prior. Refis were -6.0% while purchase apps were -0.1%. The refi share of loans fell to about 53%.) The April ADP report came out +156k, worse than expected. Not that it directly impacts interest rates but we also had the March international trade balance was $40.4 billion - will GDP be revised higher? Q1 labor productivity was -1.0% and unit labor costs rose. Markit Services PMI will be released at 9:45AM EDT followed by April ISM non-manufacturing PMI at 10AM EDT. March factory orders will also be released at 10AM. We're at 1.78% on the 10-year versus 1.80% last night, and agency MBS prices are a shade better.

Jobs and Announcements

Embrace Home Loans continues to expand and is looking to hire Branch Managers and Loan Officers in the Southeast, Northeast and Mid-Atlantic regions. "Embrace is the place retail sales professionals go to grow personally and professionally. Embrace offers a family oriented culture, a full menu of products, and competitive compensation. Licensed in 47 states plus DC, Embrace ranks in the top 25 private mortgage lenders and top 25 FHA originators in America. For 10 straight years Embrace has achieved a 98% Customer Service Rating and is 7 times recognized by Fortune, as a Top 25 Mid-size Companies to Work for in America. If you are interested in working with a supportive, driven and productive company contact Jeff McGuiness, Chief Sales Officer at jmcguiness@embracehomeloans. com, or check out Embrace."

Indecomm Global Services, a leader in business process outsourcing, consulting, learning, and technology solutions to the mortgage industry is seeking additional talent to their sales team, specifically  Sales Directors for the Eastern and Mid-west accounts. 2 years' experience in outsourcing and technology sales a must. To submit a confidential resume, please contact Linda Bomar. 

From Troy Michigan comes news out of Dart Appraisal that it has promoted Mark Luckas to director of client services. Luckas will oversee all client care activities for the appraisal management company, including client service delivery and management of the customer service team and client advocate group, and for creating best practices across the company's client base to help promote strategic partner growth.

And there are new products out there in the lending world.

Silver Hill Funding introduced its new Multifamily Streamline Program for small-balance commercial mortgage loans from $250,000 to $1,000,000. "With no tax returns or 4506T required, this program appeals to a historically underserved group of credit-worthy investors who are unable to provide sufficient income verification. Mortgage brokers looking to add new revenue streams to their business can learn about streamline programs and other aspects of small-balance commercial mortgage lending by registering for Silver Hill Funding's upcoming webinar."

Parkside Lending recently announced the release of its 95% LTV Expanded Jumbo. This product does not require mortgage insurance and is for loans up to $1,000,000. We are pleased to add this to our existing suite of Jumbo products, including our Premier Jumbo, Jumbo I and Jumbo III, to help borrowers who need loan amounts greater than $417,000  - a particular need in some regions and markets. For more information on the 95% LTV Expanded Jumbo or any of our other Jumbo products, contact your Parkside Account Executive or info@parksidelending. com.  

On April 25^th, Nationstar Correspondent announced two new affordable lending products in Seller Guide Update 2016-04. The FHLMC Home Possible and FNMA Home Ready products compliment Nationstar Correspondent's current suite of Agency (Fannie Mae, Freddie Mac and Government) products and are designed to help lenders confidently serve today's market of creditworthy, low- to moderate-income borrowers, with expanded eligibility for financing homes in designated low-income, minority, and disaster-impacted communities. Whether you are a current client or are interested in partnering with Nationstar Correspondent, contact your region's Sales Account Executive by clicking on the 'Contact Us' tab of Nationstar Correspondent's website located at www.nationstarcorrespondent.com. The Nationstar team will also be at this year'sNational Secondary Market Conference & Expo in New York this month.  If you would like to schedule time to meet with Nationstar, reach out to your region's Sales Account Executive.

Pacific Union Financial has created a Withdrawn/Lifted Overlay matrix to reflect overlays that have been removed due to determination to be obsolete or no longer necessary. Overlays that will remain in place are listed on the new Overlay Matrix.

This Lender Letter introduces a new mortgage loan modification program, the Fannie Mae Principal Reduction Modification, at the direction of FHFA and in collaboration with Freddie Mac. Details of this program are included in this Lender Letter. In addition to LL-2016-02, Fannie Mae is also publishing a list of Servicer FAQ's related to this program.

During this weekend Fannie Mae will update Condo Project Manager to implement Version 6.0. The following changes will enhance CPM and make it easier for lenders to do business with Fannie Mae: Make CPM compatible with current industry internet browsers, and enhance security and geocoder functionality. For details, view the CPM 6.0 release notes. CPM will be unavailable during the weekend update period.