Week Ahead: FDIC to Release Quarterly Banking Profile

By Jeff Bater and Chris Bruce

Feb. 19 — The Federal Deposit Insurance Corporation (FDIC) is due Feb. 23 to release its latest bank earnings report, and the data will show whether the pace of loan growth picked up or eased.

The report on earnings of banks and thrifts insured by the agency will include data for the fourth quarter of 2015 as well as for the full year.

In its last earnings briefing, held in November, the FDIC said its regulated banks and savings institutions reported aggregate net income of $40.4 billion during the third quarter of 2015, which was $1.9 billion, or 5.1 percent, higher than earnings during the same period a year earlier. The report showed that total loan and lease balances rose 5.9 percent year over year — the largest 12-month growth rate since mid-2007 to mid-2008.

In its quarterly earnings reports, the agency also breaks out profits of community banks and provides an update of conditions in the industry. During the last briefing, the FDIC warned of signs of growing interest-rate risk and credit risk that warrant attention by lenders.

CFPB, Congress

The Consumer Financial Protection Bureau's Consumer Advisory Board is scheduled to meet Feb. 25 and discuss the bureau's strategic outlook. Richard Cordray, the agency's director, is on the agenda to deliver welcoming remarks. The board is made up of professors, business executives, and community group leaders.

The House Financial Services Capital Markets Subcommittee will hold a Feb. 24 hearing on the fixed-income markets, including regulation of collateralized loan obligations. The hearing will cover “the impact of the Dodd-Frank Act and Basel III on the fixed income market and securitizations,” according to the committee's website. The subcommittee is led by Rep. Scott Garrett (R-N.J.).

In the Courts

Justices of the U.S. Supreme Court, now eight in number following the Feb. 13 death of Justice Antonin Scalia, are scheduled to sit Feb. 26 for their first conference since returning from the court's winter break. The court previously had set a conference for Feb. 19 but canceled it.

Among other cases, the conference offers the court a chance to act on a petition by Midland Funding LLC, which in November sought review of a May ruling by the U.S. Court of Appeals for the Second Circuit that said the National Bank Act (NBA) does not preempt state-law claims by borrowers on loans that Midland acquired from a national bank (Midland Funding LLC v. Madden, U.S., No. 15-cv-00610, brief filed, 12/10/15).

Banking and other financial services trade groups have urged the court to hear the case, saying the Second Circuit's decision has thrown a wrench into credit markets. Lawyers for the plaintiff-respondent, Saliha Madden, Feb. 12 submitted a brief saying the court should reject the petition.

Notable Cases

Elsewhere, procedural moves are expected in two Fair Housing Act (FHA) lawsuits against major financial institutions, one by the city of Miami Gardens, Fla., against Citigroup, and the other brought by the city of Chicago and a nearby county against Wells Fargo.

In the Miami Gardens suit, Judge Marcia G. Cooke of the U.S. District Court for the Southern District of Florida Feb. 1 gave the city until Feb. 22 to file an amended complaint (Miami Gardens v. Citigroup Inc., S.D. Fla., 14-cv-22204, scheduling order, 2/1/16).

In the Chicago case, Judge Gary Feinerman of the U.S. District Court for the Northern District of Illinois is scheduled to preside over a Feb. 24 status hearing. Wells Fargo has asked the court to dismiss the case (County of Cook, Ill. v. Wells Fargo & Co., N.D. Ill., No. 14-cv-09548, motion to dismiss filed, 10/27/15).

Meanwhile, a Texas bank that has challenged the constitutionality of the Consumer Financial Protection Bureau has until Feb. 24 to file the latest brief in that case, where motions for summary judgment are pending in the U.S. District Court for the District of Columbia (State National Bank of Big Spring v. Lew, D.D.C., No. 12-cv-01032, motion for summary judgment, 11/6/15).

State National Bank of Big Spring, Texas, filed the suit in 2012, challenging several core elements of the Dodd-Frank Act. Judge Ellen S. Huvelle threw out the suit in 2013, holding the plaintiffs lacked standing, but the D.C. Circuit allowed the bank to revive some of its claims. The lawsuit also seeks a ruling that CFPB Director Cordray's January 2012 recess appointment by violates the Constitution.

To contact the reporters on this story: Jeff Bater in Washington at jbater@bna.com; Chris Bruce in Washington at cbruce@bna.com

To contact the editor responsible for this story: Mike Ferullo in Washington at mferullo@bna.com