The Consumer Financial Protection Bureau is leaning against subjecting banks to new rules that would cap the size and frequency of overdraft charges, according to sources briefed on the agency’s work. Instead, the CFPB is likely to limit its action to barring lenders from reordering transactions, a practice in which the order of transactions is manipulated to maximize the number of overdrafts applied to an account. The CFPB may also require better disclosure of overdraft policies to consumers to help them avoid these fees. The CFPB hopes to balance its new consumer protection measures with... Read more

A new report from the Filene Research Institute finds that Hispanics -- even those with a greater degree of formal education -- continue to face significant financial challenges. The report surveyed Hispanics who have received at least some college education. Of this group, 40 percent can be classified as “financially fragile,” meaning that they could not come up with $2,000 if the need arose within the next month. Half of credit cardholders in the group reported behaviors that could damage their credit scores and increase interest rates, such as paying only the minimum payment and paying... Read more

Acting Assistant Secretary for Financial Stability Timothy Bowler will be leaving the Treasury Department in mid-June after leading the department’s wind-down of the Troubled Asset Relief Program (TARP). The TARP Capital Purchase Program currently has 30 banks remaining, down from 700 in 2008. Of these, two are CDFI banks. The CDCI portfolio contains 69 CDFIs, 29 of which are CDFI banks. Bowler assumed his role managing the portfolio after Timothy Massad left to be chairman of the Commodity Futures Trading Commission. Bowler has not yet confirmed any future career plans.

In an interview, David Reiling, CEO of Sunrise Banks, describes how he built the bank's brand by working for the community and focusing on social impact. Reiling says listening was the key to Sunrise's success in helping underserved communities. For example, observing the popularity of prepaid cards among Minneapolis' Hmong immigrant community led Sunrise to introduce its own prepaid cards. “I used to pull up a chair next to bank teller lines and talk to people about their views and needs," Reiling says. "I walked around neighborhoods. I talked and I listened... Our... Read more

The CDFI Fund is accepting proposals for new and innovative ways of expanding services in low-income and distressed communities as part of its newly announced Innovation Challenge. The goal of the Innovation Challenge is to finance the development of a method, model, tool or product that CDFIs can use to build capacity and expand CDFI investments in underserved target markets, especially in rural areas. Through the Innovation Challenge, the CDFI Fund will select a contractor to conceptualize, propose, develop and demonstrate new and innovative methods that will increase the capacity of... Read more

Mechanics and Farmers Bank, one of the nation's oldest and largest African-American-owned financial institutions, is rebranding as part of a broader effort to attract a younger and more diverse customer base. The Durham-based bank will now be branded simply as M&F Bank. “We’re trying to attract a younger demographic, a younger customer base,” James H. Sills III, the bank’s president and CEO, said. “Sixty percent of our customers are 60 years old and above... The future for us is the consumer that is 35 to 55... We’re going to be actively seeking diverse clientele. We... Read more

Bank of America and JPMorgan Chase will finally put to rest bills that are still alive on credit reports although legally eliminated in bankruptcy — potentially providing relief to more than a million Americans. The move is a victory for borrowers whose credit reports have been marred as a result of the reported debts, imperiling their job prospects and torpedoing their chances of getting new loans. The change by the banks emerged this week in Federal Bankruptcy Court, where the two banks, along with Citigroup and Synchrony Financial, face lawsuits accusing them of deliberately ignoring... Read more

Registration is open for the CDFI Fund's Expanding CDFI Coverage in Underserved Areas Capacity Building Initiative workshops. This series of two-day workshops will provide specialized training and technical assistance to certified and emerging CDFIs seeking to expand their reach into underserved communities. Opportunity Finance Network (OFN) will partner with subject matter experts including CDBA to provide three workshops relevant to all types of CDFIs. The first session,... Read more

More than 26 million consumers are effectively "credit invisible" because they have no credit record and another 19 million are "unscored" because they have an insufficient or stale credit history, according to a CFPB report. The study found that in low-income neighborhoods, almost 30% of consumers were credit invisible while another 15% had records that can't be scored. Those percentages drop to 4% and 5%, respectively, in higher-income neighborhoods. The study also found that black and Hispanic... Read more