Banking/Financial Institutions

“I don't have anything for you on my personal plans," Bernanke tells reporters.

Several of the nation's largest banks are failing to meet the standards set out in a $25 billion national mortgage settlement reached over shoddy foreclosure practices. 

The nation’s largest mortgage servicers — Bank of America, Citi, JPMorgan Chase, Ally Financial/GMAC and Wells Fargo — have missed targets on eight standards required under the mortgage settlement that was inked in January. 

The biggest problem for banks so far has been a lack of communication with customers, as well as delays in the processing of loan modification applications, according to a report — the first on their compliance — released on Wednesday by Joseph Smith, the monitor of the settlement. 

The results, showing three testing fails last year, and five additional fails this year, were submitted to the U.S. District Court for the District of Columbia. 

"These results demonstrate that the settlement is allowing us to uncover areas in which more work needs to be done," Smith said. "The banks are now working to correct these errors and will be tested again to determine their level of improvement."

Ben Bernanke faces some big challenges in perhaps his final months at Fed. Read more...

A senior House Democrat called on federal regulators to look into the actions of any mortgage servicer that might have benefited by misleading borrowers about federal loan modification programs. 

California Rep. Maxine Waters, ranking member of the House Financial Services Committee, sent letters on Tuesday calling for an investigation of Bank of America or any other bank that may have deliberately delayed loan modification applications to force troubled borrowers into foreclosure instead.

She said, according to court documents, that employees reported falsifying records and were told to find ways to delay loan-assistance applications under the Home Affordable Modification Program (HAMP) by requesting paperwork that had already received in an effort "to maximize fees for the bank." 

"The goal of the delay was to ensure that rather than receiving a HAMP modification, the borrower would be foreclosed upon," Waters wrote. 

Treasury Secretary Jack Lew is willing to consider additional rules and regulations to end banks that are too big to fail.

In an interview with Univision on Monday, Lew was hopeful that reforms under the Dodd-Frank law had sufficiently reined in the financial sector, but pledged to do more if need be.

"I think that with the passage of Wall Street reform, the Dodd-Frank Act, we now have powerful tools which we’re implementing on a day-to-day basis now," he said. "And by the end of this year I am confident that we will have taken those powerful tools and made enormous progress."

Obama said Bernanke "already stayed a lot longer than he wanted or he was supposed to."

The head of a key division within the Federal Deposit Insurance Corporation announced his retirement, triggering a pair of personnel changes at the banking regulator.

The FDIC announced Monday that James Wigand is leaving his position as director of the Office of Complex Financial Institutions (OCFI), which he held for three years.

The high court has agreed to review the "disparate impact" policy that the Obama administration has used to sue banks.

The financial word is on edge ahead of this week’s meeting of policymakers at the Federal Reserve. 

Traders will be closely watching Wednesday’s policy update from the central bank for any clues as to when the Fed might end its unprecedented stimulus efforts.

Financial markets have dipped lower in recent days, driven largely by concerns that the Fed might be eyeing the exit, so the policy update will be pored over by Fed watchers in Washington and on Wall Street.

Fed Chairman Ben Bernanke will field questions at a press conference following the meeting.

Across the Atlantic, Group of Eight (G8) leaders will gather in Northern Ireland , and one of the top items on the agenda will be tax evasion. British Prime Minister David Cameron is pushing to require multinational corporations to disclose taxes on a country-by-country basis, and Sen. Carl Levin (D-Mich.) on Friday pushed for the White House to join that effort. 

Trade will also be a major focus at the G8, as the U.S. and the European Union gear up for negotiations in July.

The House and Senate, meanwhile, have a full docket ahead of them this week.

House lawmakers are nearing the finish line on their version of a five-year farm bill, which is set for a vote this week. Leaders are close to having enough votes for passage, and hope to close the deal now that Speaker John Boehner (R-Ohio) has pledged to vote for the $940 billion measure. 

The Senate cleared its version of the farm bill earlier this month, setting the stage for a conference committee if the House can clear its bill. The biggest difference between the two is the size of cuts to food stamps: $4 billion in the Senate bill versus $20.5 billion in the House.

The Senate will be continuing work on comprehensive immigration reform in a push to hold a final vote before the July 4 recess.

On Tuesday, the Senate Finance Committee will explore the “bitter pill” of high healthcare costs, and what Congress could do about it. Steven Brill, the author of a widely read Time magazine piece on the subject, will testify.

The House tax-writing panel has three subcommittee hearings on tap next week that will explore the nation’s welfare system, Social Security disability insurance and the Medicare trustees report.

Also on Tuesday, the Senate Budget Committee will hear testimony from Education Secretary Arne Duncan as he makes the case for his department’s fiscal 2014 budget request.

Tuesday will also be a busy day for Senate appropriators, as two separate subcommittees will be marking up spending bills. Appropriations legislation for military construction and veterans’ affairs, as well as farm appropriations, will be up for debate and amendment.

House appropriators will be taking up an energy and water spending bill that same day.

The House Financial Services Committee this week will examine the Consumer Financial Protection Bureau’s budget. The Tuesday subcommittee hearing will include testimony from the agency’s chief financial officer, Stephen Agostini. 

The House committee announced in April that CFPB Director Richard Cordray would not be welcome to testify before the panel, as Chairman Jeb Hensarling (R-Texas) argued his recess appointment made him an invalid head of the agency.

Speaking of the CFPB, the Supreme Court this week will decide whether to hear a case that could weigh heavily on Cordray’s position at the agency. 

The Supreme Court will decide whether to hear an appeal to a federal court ruling that invalidated a trio of recess appointments President Obama made to the National Labor Relations Board. The president made those picks on the same day he tapped Cordray for his job, so the high court’s move should weigh heavily on the CFPB debate.

The high court also will decide next week whether to hear a case challenging the use of “disparate impact” to identify discriminatory practices. The administration has used the approach, where statistical analysis can be used to build discrimination cases in housing matters, over the objections of the financial industry.

Fourteen California Democrats are urging Attorney General Eric Holder to investigate JPMorgan for potentially manipulating the energy market to boost electricity prices by millions of dollars.

The coalition, led by Rep. Maxine Waters (D-Calif.), called Thursday for a "thorough investigation" into the accusations, first brought to light by a New York Times article.

The publication reported in May that the Federal Energy Regulatory Commission was prepared to recommend action against the bank over its activities in California and Michigan energy markets, as well as actions against a senior executive at the bank, Blythe Masters, for making false statements under oath about the practice.

The spokesperson for bank told the Times it plans to "vigorously defend" itself from the accusations. But earlier this month, the commission ruled that JPMorgan traders improperly manipulated California energy markets, as market participants collected more than $52 million in excess profits, according to The Sacramento Bee.