"I swear, if my memory was any worse I could plan my own surprise party." Remember when you were a student? Research from the Fed finds total student loan debt was $1.2 trillion at the end of 2014, with a median loan debt balance of $14,400 and an average balance of $26,700. Meanwhile, 17% of borrowers were behind in their payments or in default and only 37% of borrowers are making payments large enough to reduce their balances.

Changes in the banking world continue unabated. In the last week it was announced that in Texas Green Bank ($2.2B) will acquire Patriot Bank ($1.4B) for about $139mm in stock. In Oklahoma Bank SNB ($2.0B) will acquire First Commercial Bank ($305mm) for about $41.7mm in cash and equity or approximately 1.4x tangible book. Moving across the country, Heartland Financial USA ($6.6B, IA) will acquire Premier Valley Bank ($647mm, CA) for $95mm in cash (30%) and stock (70%). But in Illinois Parkway Bank and Trust Co ($2.2B) has called off its acquisition of Park Federal Savings Bank ($154mm).

The Board of Directors of CertusBank, N.A. announced agreements to sell the bank's deposits, certain loans, and branches in South Carolina, Georgia, and Florida through four separate transactions. "The planned transactions are the result of deliberate efforts to review CertusBank's strategic options in light of its capital challenges and implement a course of action that provides the best available outcome for the bank's customers, communities, teammates and stakeholders. Most CertusBank teammates in the affected branches will be offered jobs with the respective acquiring bank. CertusBank expects the transactions, which are subject to regulatory and shareholder approval, to close in the third and fourth quarters of 2015. In the coming months, CertusBank anticipates closing the following transactions: Community & Southern Bank (Atlanta, GA) will acquire the majority of CertusBank's Georgia deposits (except as described below), and all of its Florida deposits, certain loans and branches. Bank of North Carolina (High Point, NC) will acquire certain deposits, loans and branches from CertusBank's South Carolina locations. Queensborough National Bank & Trust Company (Louisville, GA) will acquire certain deposits, loans and branches from CertusBank's Savannah and Rincon, GA locations. Morris Bank (Dublin, GA) will acquire certain deposits, loans and a branch from CertusBank's Warner Robins, GA location. CertusBank will close its Columbia, Charleston, downtown Greenville, SC and Ponte Vedra, FL branches."

First National Bank of Pennsylvania ($16.1B, PA) will acquire 5 branches in PA from Bank of America for a 2.75% deposit premium ($7.7mm premium for about $280mm in deposits). American State Bancshares ($653mm, KS) will acquire 3 KS branches from Simmons First National Bank ($4.7B, AR). In Michigan Isabella Bank ($1.5B) will acquire 1 MI branch from Flagstar Bank FSB ($11.5B).

Yes, the CFPB is alive and well, and expected any day now to announce more lender-specific news regarding enforcement action settlements. But stepping back onto the TRID mill, along with the news yesterday that enforcement actions will be delayed the CFPB released a fact sheet detailing the circumstances when the TRID rule requires borrowers to have an additional three-day review period. As the CFPB explains, there are three specific instances when changes to disclosures would trigger an additional three-day review period and thereby impact the closing timeline: "Increasing the annual percentage rate (APR) by more than 1/8 of a percentage point for a fixed-rate loan or 1/4 of a percentage point for an adjustable-rate loan (decreasing the interest rate or fees doesn't cause a delay); the addition of a prepayment penalty; changes in the loan product, from a fixed-rate to an adjustable-rate loan, for example." There may be some industry confusion as to a delay - hopefully this clears it up.

Dave Stevens, president of the MBA, released, "To read a letter that the CFPB sent to Congress today about TRID click here, and to read a further explanation from CFPB click here. Finally, MBA's statement on this decision is here. MBA believes the Bureau's action is a positive step.  However, we will continue to work on your behalf to secure additional protections from private litigation and to ensure that the Bureau provides written implementation guidance to address issues that arise after the August 1 implementation date."

Isaac Boltansky with Compass Point Research & Trading, LLC observed, "The CFPB's TRID decision is generally consistent with our expectations as we viewed a delay in the effective date as highly unlikely, but the language defining the enforcement grace period is amorphous. Director Cordray's letter notes that the bureau used an enforcement grace period following the finalization of the CFPB's Ability-to-Repay (ATR)/Qualified Mortgage (QM) rule which he described as having "worked out well." To put that into perspective, the bulk of the CFPB's ATR/QM rules went effective in January 2014 and the bureau began supervisory examinations for compliance four months later. We believe that the CFPB's TRID announcement should be viewed as an incremental positive for mortgage credit availability as it lessens the compliance uncertainty hovering over the August 1 effective date but the inherently nebulous nature of these open-ended grace periods leaves a lingering policy overhang."

On the temporary delay in enforcement action Walt writes, "This also raises some question as to how selective the enforcement will be... so... Deep pockets only enforcement from an agency that self-funds? So a Big Lender is not ready, shame on them... but ABC Credit union is not and then a large title company closes their deal (FATCO / Fidelity / Stewart / ORT / TRG etc...) who's liable, anyone? Leaves a lot of doors open... they bent a little... but selective at their own discretion."

Darcie Cancino, Manager, Lending Compliance with SchoolsFirst Federal Credit Union writes, "Remember, though, while there may be delayed or leniency in CFPB enforcement, there remains private right of action under TILA for compliance failures. So while this news may help somewhat, it's not foolproof protection."

The American Bankers Association wrote, ""We appreciate the CFPB's statement that it will be sensitive to industry compliance efforts with regard to TRID implementation. However, we are disappointed that the statement falls well short of a 'hold harmless' period, which ABA  and nearly 300 members of Congress asked for.  While the bureau acknowledged the implementation challenges of this rule, CFPB's decision will only provide limited assurances to bankers in their efforts to comply. ABA believes it is critical to establish a formal transition period for banks, and strongly advocated for restrained enforcement by providing survey data on vendor readiness to the bureau, sending letters and holding meetings, and providing the sole banking witness at a recent hearing on TRID implementation. We extend a special thank you to the members of Congress who sent letters urging Director Cordray to provide an enforcement grace period. We look forward to continuing to work with the CFPB and Congress to ensure consumers' continued access to mortgage credit."

And from ALTA: "'ALTA members were looking to the Bureau to announce a specific hold-harmless period for those working to comply in good-faith with the new mortgage disclosures,' said Michelle Korsmo, ALTA's chief executive officer. 'We appreciate the Bureau addressing the challenges with compliance with the new integrated mortgage disclosures once we are in live transactions. Unfortunately, today's blog post from the CFPB does not give mortgage lenders or settlement service providers any more certainty as they work to comply with this complex regulation that will affect millions of homebuyers in the United States...we request that the Bureau continue to publish more clarifications on this massive regulation,' Korsmo added. 'Because of the CFPB's ambiguity, ALTA encourages Congress to pass H.R. 2213 sponsored by Congressmen Pearce (R-NM) and Sherman (D-CA) and that would mandate a definitive hold-harmless period. Under TRID, some mortgage lenders and settlement service providers may initiate additional risk-management tactics that will slow the closing process for homebuyers. Access to financing and settlement services in small communities could be more restricted. 'To suggest that real estate closings will not be delayed under TRID is looking at this 1,888 page regulation through rose colored glasses' said Korsmo. 'ALTA members are doing their best to prepare for implementation but the uncertainty caused by this rule could result in delays in real estate closings. In today's announcement, there's no guarantee that homebuyers won't experience a longer time period between when they apply for their mortgage and when they actually sit down at the closing table.'"

And Credit Union National Association (CUNA) president and CEO Jim Nussle released a statement: "I thank CFPB Director Cordray for listening to the requests of CUNA, Congress and others in our call for a safe harbor period through the end of the year for the enforcement of the TRID rule. CUNA supports the CFPB's goal for transparency with the new disclosures helping consumers better understand mortgage terms, and now credit unions will be allowed the time they need to figure out the day-to-day aspects of complying with the rule without worrying about enforcement."

Rates continue to creep up - is that a stunning surprise to anyone? Well, maybe to those that either think our economy doesn't warrant higher rates, or anyone who bet their company's fortune or reputation on rates going down. Only one thing is guaranteed: rates will change.

Wednesday's activity was attributed to German bund yields: they declined on an improving inflation outlook for the ECB along with prospects that Greece and its creditors would come to an agreement. Here in the States the ADP employment number for May was in line with expectations which led to increased worries that Friday's employment situation will be better than projected, while the trade deficit shrank more than expected resulting in positive implications for Q2 growth. Finally, there was the Federal Reserve's Beige Book which said overall economic activity expanded over the early April to late May period, and that "Outlooks among respondents were generally optimistic, with growth expected to continue at a modest to moderate pace in several districts."

All of that resulted in a decline in the 10-year T-note of almost 1 point and closing at 2.37% - its highest level since November 2014. Agency MBS price movement was, as always, dependent on coupon but they worsened .5-.75. Thomson Reuters reports that, "Already over Monday and Tuesday, supply jumped to a daily average of $2.3 billion compared to $1.6 billion last week. The Fed at least was a decent offset at a $2.25 billion per day average."

For news today we'll have Initial Jobless Claims (expected -3k) and revised Q1 Productivity/ULC (expected -2.9%) at 6:30AM MDT. In the very early going we're sitting at 2.40% with agency MBS prices worse another .125.

Jobs and Announcements

Here's an opportunity for a company trying to expand. A Texas bank is looking to sell its Texas Wholesale Mortgage Division which includes a servicing portfolio. The current business mix is 70% purchase and 30% refinance with a 50/50 concentration in FHA and Conventional and 90% Texas Properties. Interested buyers should have agency approvals. Loan performance and quality has been excellent. Interested parties should email me at rchrisman@robchrisman. com. An NDA will be required to learn anything more than noted above and initiate discussions; all inquiries are entirely confidential. (Please excuse any delays in response due to travel from Denver to Oakland.)

Here is some feedback from Dr. Rick Roque, Managing Director of Retail at MiMutual Mortgage, a dba of Michigan Mutual, a national Retail Mortgage Banking Firm making aggressive in-roads in acquiring companies and branches across the United States. "The deal making activity between quality top producing loan officers and branch managers is very high. There are a few dominant themes that have emerged across producers making a switch. Many mortgage companies have slower turn times due to having over-burdened operations and a lack of personalized support for branches and loan officers.  With offices we have recruited or opened in Arizona, South Carolina, Washington, Florida and other markets, we've noticed a change in company culture where mortgage professionals can grow their careers from within. We expect a great deal of consolidation in the 3rd and 4th quarters, once TRID is behind us." Dr. Roque is actively recruiting and loan officers, branches, or companies interested in talking to him can call 408.914.5895.

Lastly, congrats to Todd Turner. Due to its growth, Tennessee's First Community Mortgage announced that Todd has joined FCM as Vice President, Regional Sales Manager.  Based in Akron, Ohio, Turner will be focusing specifically on building sales teams in Ohio, Michigan, Indiana, Kentucky, West Virginia, Virginia, and Pennsylvania. "Todd is an exceptional sales leader and has a strong record of leading successful sales teams.  FCM is very excited to have Todd lead their expansion in Ohio and the surround states", says Andy Voyles, SVP of Retail. If you're an LO or branch manager interested in seeing what FCM is up to in a confidential manner, contact Todd Turner.