If you think regulatory trends aren't influencing businesses, big and small, think again. In the latest "big" example, insurance company MetLife said it will sell or spin off most of its retail group as it seeks to avoid being classified as a systemically important financial institution (SIFI). Such designation requires more onerous regulation and increased costs, so MetLife is seeking to restructure parts of the company. MetLife is the largest life insurer in the US and has $2.5T in policies written and $350B in assets under management. Speaking of which, Dodd-Frank measures are about 70% complete. The Obama administration has one year to finalize 123 of the 390 rule-making mandates in the Dodd-Frank Act. "Nearly all of the major rules under Dodd-Frank have been written, and we are focused on building on the progress we've already made and seeing implementation through," a representative for the Treasury Department said.

Turning to banking, since banks are certainly a potent force in lending, we've seen a spate of earning announcements lately as well as smaller banks finishing their books for December and for 2015. Established and larger community banks appear to be doing much better on several fronts than bigger banks, and they have done it by sticking to their business of handing out loans to worthy businesses operating in local communities.

In big bank earning news we can check in and see if any of their 2014 vs. 2015 trends apply to the smaller lenders out there. JPMorgan saw its net income rise 12%) with a 0.99% ROA (+11%) and end the year with $2.4 trillion in assets (-9%). It has 5,413 branches (-3%), 17,777 ATMs (-2%), 39.2 million active online customers (+8%) and 22.8 million active mobile customers (+20%). Wells Fargo had an unchanged net income (+0%) with a 1.32% ROA (-9%) and $1.8 trillion in assets (+6%). Wells has plenty of branches (8,700 locations), 13,000 ATMs (+4%), 26.4 million active online customers (+7%), and 16.2 million active mobile customers (+14%). Speaking of big banks with both retail and correspondent channels, US Bank saw its net income rise by 1%, a 1.44% ROA, wrap up the year with $422 billion in assets (+5%). US Bank has 3,133 offices (-1%) and 4,936 ATMs.

Using Wells as a bellwether indicator given its market share, Wells Fargo reported that its 4Q15 mortgage volumes fell by 15% quarter over quarter but was up 7% Y/Y. The decline was evenly distributed in both correspondent and retail, and is more modest than the 25% Q/Q decline reported by Chase. The Gain on Sale margin was down very modestly Q/Q: gain on sale margin was down very modestly at 183 bps, down from 188 bps in 3Q. The company took a positive MSR rate mark that was a little over 4% of the prior quarter MSR balance. The Q/Q decline reported by WFC was better than the 25% Q/Q decline reported by JPM. It looks like industry mortgage volume in the 4th quarter is likely to fall by more than the 8% decline forecast by many.

On its earnings call JPMorgan commented on the new TILA-RESPA integrated disclosure (TRID) changes. JPM noted that the new TRID regulations extended cycle times by a few days during the 4th quarter. JPM stated that the extended cycle times did not affect their financial results. The company stated that volumes were a little lower than they would have been absent TRID, but the extended cycle times did not affect their financial results due to how they recognize revenue. Most mortgage banks recognize revenue upon rate lock and not when loans close.

Switching gears to the proper abbreviation for "Alternative Settlement Statement", from Virginia Titleworks' president Becky Taylor wrote to say, "We call the Alternative Settlement Statement or the American Land Title Association 'ALTA' approved Settlement Statement - just 'ALTA'." Thanks Becky!

K&L Gates published an article citing the ten fundamental lessons all businesses should consider regarding their online presence. Businesses should first be aware of what they are agreeing to when establishing a social media presence. Not only are businesses obligated to comply with the terms of use and privacy policies, each social media network has additional contracts for businesses. If you have your own website but utilize social media plug-ins, or log-in credentials, a different contract will be applicable. It's also important to know who has content or data rights, a general rule of thumb is that businesses own its own content, but businesses may grant the social media platform or users a variety of licenses or permissions that can impact value, including value of business' data. The entity creating content generally owns the copyright and posting it on businesses' page doesn't transfer the copyright or create a license for re-using the posting - this would have to be done via contracts.

The Basel Committee on Banking Supervision has unveiled updated trading-book rules for major banks. The rules include a 40% increase in capital requirements on swaps, bonds and other securities, effective in 2019. Speaking of foreign themes, Societe Generale SA is pulling back from the U.S. mortgage-bond business just two years after building out the unit!

Looking at the actual markets one day of calm is as good as it gets. Tuesday saw a sedate session in relative terms. The 2.08% level on the US 10-year T-note proved a great staging ground for the market and we bounced sharply off of that level in early NY hours. But we had a big rally last night as "overnight risk off resumed in aggressive manner overnight with crude and Asian equities getting smashed.

Yes, bonds are off to the races after U.S. equity index futures fell with European and Asian stocks. The oil/commodities slump continues with crude at the lowest since Sept. 2003. European stocks opened down following poor performance in Asia after disappointing data from China. We are back below 2% on the 10-year - who guessed that? The 10-year note has broken well below the year-long uptrend yield line and has been contained multiple times by long term support. Going back a year the 10-year traded at 1.66% and is at 1.98% currently after closing 2015 at 2.27%.

And this morning stocks are "in the red" everywhere. There isn't a specific fundamental reason or "headline" but instead equities globally remain stuck in a vicious negative feedback loop. Crude oil continues to sink (there was no major oil-specific news in the last 12-18 hours). We've already had the news for the day: the Consumer Price Index was -.1%, below expectations, Housing Starts were -2.5%, and Building Permits were -3.9% - not good news. Not that anyone cares about economic news anymore. Let's not forget that the Mortgage Bankers Association let us know that apps for last week rose by +9.0% led by refis +19% (purchases dropped 2%). We had a 2.04% close on the 10-year and this morning we're at 1.98% with agency MBS prices better between .250-.50.

Jobs and Announcements

In correspondent job news, PHH Mortgage is expanding its Correspondent Lending Sales team, and looking for seasoned sales professionals with a proven track record of growth and client service. Experience with financial institutions, in particular credit unions, is highly desirable for these positions. PHH has more than 25 years of experience partnering with correspondents and delivering high-touch personalized service, which has resulted in long-term relationships built on quality business. Account Managers are needed in the greater Boston area to cover New England and New York; Cincinnati, Columbus or Indianapolis to cover OH, MI, IN, KY and TN; Dallas/Fort Worth or Houston to cover TX, OK, AR, LA, NM and KS; and Southern California to cover CA, AZ, HI and NV. Interested candidates should contact Steve Yaroch, VP National Sales.

On the retail side Inlanta Mortgage reports that 2015 was another year of consistent growth: production increased 54%, and the company was the #1 WHEDA and #2 FHA purchase lender in the frozen tundra of Wisconsin. Inlanta has continued on a progressive and selective growth strategy and is seeking out mortgage professionals with an entrepreneurial approach to the business who "thrive in the unique culture of collaboration between sales and ops, and 'ownership' of success. Many of the existing managers joke that Inlanta's reputation is an environment of 'mortgage banking for grown-ups.' Joe Ramis, SVP of Business Development, suggests, 'If you have managed your own business and are purchase-focused as well as self-sourced, there is a good chance you will thrive here.' Joe goes on to say that 'if you are thinking about making a career change, pick up the phone and call any of our branch managers and talk to them.' If this sounds like the place for you, contact our Branch Recruitment division at 877-326-5626 or email partners@inlanta.com. We are looking to grow in the following states: Colorado, Florida, Iowa, Illinois, Indiana, Kansas, Kentucky, Maine, Massachusetts, Michigan, Minnesota, Missouri, New Hampshire, Rhode Island, Vermont, and Wisconsin."

A well-capitalized, national mortgage lender is looking for a Division Sales Manager to run East Coast Wholesale Sales. With over 15 years in the mortgage industry this well established lender offering Fannie, Freddie and Ginnie products, is seeking an individual to manage a large territory. Leading its Midwest and East Coast sales, this position offers an aggressive and competitive compensation plan. Interested parties can send confidential resumes to me at rchrisman@robchrisman.com.

Do you use Dovenmuehle as your subservicer? Richey May & Co, an accounting firm recognized as a leader in providing audit, tax, compliance and oversight services within the industry, is heading out to Dovenmuehle at the end of the month to conduct a comprehensive subservicer oversight review that includes loan-level testing and a thorough review of the Dovenmuehle's policies and procedures and internal controls. Richey May conducts the review on behalf of multiple clients at the same time, thereby sharing expenses and creating cost savings that are passed on to participating clients. If you are an agency seller/servicer, or GNMA issuer, you are fully responsible for monitoring and overseeing your subservicer's performance as required by the CFPB and other regulators. For more information about Richey May's subservicer oversight review program, or to participate in the January Dovenmuehle review or the upcoming 2016 Cenlar and LoanCare reviews, please contact Kurt Blohm.

In other lending industry news California's Blend secured $40 Million in Series C Funding. "Blend, the Silicon Valley technology company, announced it raised $40 million in Series C funding led by Founders Fund. Lightspeed and Formation 8 are existing investors participating in the round. Blend will use these funds to continue to recruit top engineering talent and bring its platform to more lenders to originate efficient, data-driven mortgages. Blend CEO Nima Ghamsari said, "We've built a flexible product that reduces the data collection burden for borrowers and speeds up processes for lenders while retaining airtight digital compliance...A single mortgage costs over $7,000 to originate. Each year the industry spends billions on largely repeatable and automatable tasks. Through Blend, originators can reduce that cost while maintaining compliance and delivering an elegant, digital experience to borrowers in weeks."

While we're on lender news, Standard Mortgage Corporation's Executive Vice President testified on January 13th to the U.S. House of Representative Financial Services Subcommittee on Housing and Insurance's. The hearing focused on "How to Create a More Robust and Private Flood Insurance Marketplace" and examined the National Flood Insurance Program to allow for review of current government flood insurance model and other changes that could positively impact the flood insurance market.

For fans of quality control - and who isn't? - here's a chance for Quality Control personnel to have some fun and win some prizes. The first ever "Mortgage Quality Control Bowl" began on the 11th and go through February 5th.  During this period, any quality control professional can sign-up to participate. The "bowl" will consist of reviewing a group of loans and identifying the problems found in them. Participants will then explain their rationale for the identified problems.  Easy to do!  Entrants will have 4 weeks to complete the files and will be able to stop and return at their convenience. The entire bowl game will be played confidentially on line and can be completed anywhere. And of course there are prizes!  The top 7 finishers will be awarded gift certificates and they will be awarded the week following the end of the contest. Anyone who wants to participate they can contact Becky Walzak or Richard Hornaday.