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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (57754)	4/9/2006 6:02:23 PM
From: Ramsey Su	Read Replies (1) \| Respond to of 110194

Seems to me the FBAs have already done some type of an audit and are ready to take action. How are we responding? We are increasing our vigilance, both from a supervisory perspective and a policy perspective. On the supervisory side, we our asking our examiners to dig deeper into loan portfolios to understand the risks individual institutions are assuming. We are paying close attention to the fundamentals, including loan documentation, pricing, loan-to-value ratios, and overall underwriting standards. We are also closely monitoring how institutions are funding their ongoing operations, particularly their mortgage originations. And we continue to monitor overall operational costs, again, with close attention paid to costs attributable to prior build-ups in mortgage lending operations. In addition to our ongoing monitoring of interest rate risk, we are looking at credit risks, particularly with respect to nontraditional mortgage lending products.