By the Division of Banks


The Division Issues its Third Round of Results from its Regulatory Review Initiative

One of the key objectives for the Division of Banks is to complete a comprehensive review of all bank and credit union Regulatory Bulletins and regulations to determine opportunities for the agency to reduce regulatory burden and compliance redundancy by streamlining, updating, or repealing requirements wherever possible. This initiative was a result of the several industry focus groups that the Division of Banks held throughout the Commonwealth of Massachusetts during 2011, and is a component of the Division’s strategic planning process. Below are brief descriptions of such changes made in this third round.

BANKS, CREDIT UNIONS, AND LICENSEES – CONSUMER PROTECTION

1.3-106 Community Reinvestment and Fair Lending Policy
This Bulletin replaces and updates Bulletin 2.3-101 and Bulletin 5.3-101 Fair Lending Policy – Licensed Mortgage Lenders. It combines the regulatory guidance for Fair Lending and Community Reinvestment (CRA) assessment criteria.  The Bulletin reiterates the need to ensure that all credit decisions, including small business lending, is conducted in a sound and fair manner.  Additionally, it recommends for regulated lenders to verify that compensation structures do not encourage any form of disparate treatment of loan applicants.  Lastly, the Bulletin incorporates loss mitigation practices under counseling provided to borrowers when addressing mortgage defaults.

BANKS AND CREDIT UNIONS – GENERAL

2.1-102 Insider Transactions
This Bulletin has been updated for clarity where necessary and also reflects the consolidation of Regulatory Bulletin 4.1-101 Loans and Fees to Directors and Senior Management Employees, which had applied only to credit unions, into this Bulletin.

2.1-104 Branch Office Notice and Application Procedures
This Bulletin was updated to reflect changes in available methods of reporting and the use of electronic media.  Additionally, the Division eliminated certain notice requirements.

BANKS AND CREDIT UNIONS – RISK MANAGEMENT

2.2-101 Investment Policy Minimum Requirements
This Bulletin was repealed in its entirety because it is no longer necessary given other guidance in effect. However, the Division must be clear that, despite the repeal of this Bulletin, all banks and credit unions must adhere to the existing guidance relative to investment policy requirements.

BANKS AND CREDIT UNIONS – CONSUMER PROTECTION

2.3-106 Deposit Return Item Fees
This Bulletin was updated to incorporate the Division’s methodology for calculating the fee.

CREDIT UNIONS ONLY - GENERAL

4.1-101 Loans and Fees to Directors and Senior Management Employees
This Bulletin has been repealed in its entirety and its provisions were consolidated into Regulatory Bulletin 2.1-102 Insider Transactions.

4.1-102 Investment in Foreign Government Bonds
This Bulletin has been repealed in its entirety, with the relevant information now provided on the Division’s website. This information is provided in the list of Regulatory Bulletins for Credit Unions Only – General, and can be found under the heading 4.1-102 Investment in Foreign Government Bonds.

4.1-103 Fidelity Bond Coverage Requirements
This Bulletin has been repealed in its entirety. However, all credit unions must adhere to federal minimum fidelity bond coverage requirements.

CREDIT UNIONS ONLY – RISK MANAGEMENT

4.2-102 Minimum Regulatory Capital Standards
This Bulletin has been repealed in its entirety. However, all credit unions must adhere to federal capital requirements.

4.2-103 Residential Mortgage Loan Underwriting
This Bulletin has been repealed in its entirety given other existing guidance.

LICENSEES ONLY - GENERAL

5.3-101 Fair Lending Policy – Licensed Mortgage Lenders
This Bulletin was repealed in its entirety and consolidated into Bulletin 2.3-101 Community Reinvestment and Fair Lending Policy.