Live Updates > Live Update Details
2026-02-17 00:43:45
[Federal Reserve Vice Chair for Supervision Michelle Bowman: The Trend of US Mortgage Business Shifting from Banks to Non-Bank Lenders is "Worrying"] Federal Reserve Vice Chair for Supervision Michelle Bowman stated that the trend of US mortgage business shifting from banks to non-bank lenders is "worrying." Speaking at a banking conference in Orlando, Bowman attributed part of the reason to the restrictive capital requirements on mortgage servicing rights (MSRs). MSRs are assets on a bank's balance sheet that represent the net fees a bank expects to receive from servicing mortgage loans over the loan term. Bowman stated that banks face a high regulatory risk weighting when holding MSRs, which "could hinder banks from building profitable servicing businesses." She acknowledged that these rules were introduced out of "reasonable concerns," but believes adjustments should be considered. "These potential changes could address reasonable concerns about the structure of the mortgage market while maintaining appropriate prudential supervision," she said.
