Document ID: SEC-2019-1919-0001
Agency: sec
Document Type: Proposed Rule
Title: Credit Risk Retention
Posted Date: 2019-12-20T05:00Z

[Federal Register Volume 84, Number 245 (Friday, December 20, 2019)]
[Proposed Rules]
[Pages 70073-70076]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-27490]

 ========================================================================
 Proposed Rules
                                                 Federal Register
 ________________________________________________________________________
 
 This section of the FEDERAL REGISTER contains notices to the public of 
 the proposed issuance of rules and regulations. The purpose of these 
 notices is to give interested persons an opportunity to participate in 
 the rule making prior to the adoption of the final rules.
 
 ========================================================================
 

  Federal Register / Vol. 84, No. 245 / Friday, December 20, 2019 / 
Proposed Rules  

[[Page 70073]]

DEPARTMENT OF THE TREASURY

Office of the Comptroller of the Currency

12 CFR Part 43

[Docket No. OCC-2019-0012]

FEDERAL RESERVE SYSTEM

12 CFR Part 244

[Docket No. OP-1688]

FEDERAL DEPOSIT INSURANCE CORPORATION

12 CFR Part 373

RIN 3064-ZA07

FEDERAL HOUSING FINANCE AGENCY

12 CFR Part 1234

[Notice No. 2019-N-7]

SECURITIES AND EXCHANGE COMMISSION

17 CFR Part 246

[Release No. 34-87714]

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

24 CFR Part 267

[FR-6172-N-01]

Credit Risk Retention-Notice of Commencement of Review

AGENCY: Office of the Comptroller of the Currency, Treasury (OCC); 
Board of Governors of the Federal Reserve System (Board); Federal 
Deposit Insurance Corporation (FDIC); U.S. Securities and Exchange 
Commission (Commission); Federal Housing Finance Agency (FHFA); and 
Department of Housing and Urban Development (HUD).

ACTION: Notice of commencement of review.

-----------------------------------------------------------------------

SUMMARY: The OCC, Board, FDIC, Commission, FHFA, and HUD (the agencies) 
are providing notice of the commencement of the review of the 
definition of qualified residential mortgage; the community-focused 
residential mortgage exemption; and the exemption for qualifying three-
to-four unit residential mortgage loans, in each case as currently set 
forth in the Credit Risk Retention Regulations (as defined below) as 
adopted by the agencies.

DATES: Comments on the review must be received by February 3, 2020.

ADDRESSES: Interested parties are encouraged to submit written comments 
jointly to all of the agencies and use the title ``QRM review'' to 
facilitate the organization and distribution of comments among the 
agencies.
    Office of the Comptroller of the Currency: Commenters are 
encouraged to submit comments through the Federal eRulemaking Portal or 
email, if possible. Please use the title ``Credit Risk Retention-Notice 
of Commencement of Review'' to facilitate the organization and 
distribution of the comments. You may submit comments by any of the 
following methods:

 Federal eRulemaking Portal--Regulations.gov Classic or 
Regulations.gov Beta

    Regulations.gov Classic: Go to https://www.regulations.gov/. Enter 
``Docket ID OCC-2019-0012'' in the Search Box and click ``Search.'' 
Click on ``Comment Now'' to submit public comments. For help with 
submitting effective comments please click on ``View Commenter's 
Checklist.'' Click on the ``Help'' tab on the Regulations.gov home page 
to get information on using Regulations.gov, including instructions for 
submitting public comments.
    Regulations.gov Beta: Go to https://beta.regulations.gov/ or click 
``Visit New Regulations.gov Site'' from the Regulations.gov classic 
homepage. Enter ``Docket ID OCC-2019-0012'' in the Search Box and click 
``Search.'' Public comments can be submitted via the ``Comment'' box 
below the displayed document information or click on the document title 
and click the ``Comment'' box on the top-left side of the screen. For 
help with submitting effective comments please click on ``Commenter's 
Checklist.'' For assistance with the Regulations.gov Beta site please 
call (877)-378-5457 (toll free) or (703) 454-9859 Monday-Friday, 9 
a.m.-5 p.m. ET or email to regulations@erulemakinghelpdesk.com.
     Email: regs.comments@occ.treas.gov.
     Mail: Chief Counsel's Office, Attention: Comment 
Processing, Office of the Comptroller of the Currency, 400 7th Street 
SW, Suite 3E-218, Washington, DC 20219.
     Hand Delivery/Courier: 400 7th Street SW, Suite 3E-218, 
Washington, DC 20219.
     Fax: (571) 465-4326.
    Instructions: You must include ``OCC'' as the agency name and 
``Docket ID OCC-2019-0012'' in your comment. In general, the OCC will 
enter all comments received into the docket and publish the comments on 
the Regulations.gov website without change, including any business or 
personal information provided such as name and address information, 
email addresses, or phone numbers. Comments received, including 
attachments and other supporting materials, are part of the public 
record and subject to public disclosure. Do not include any information 
in your comment or supporting materials that you consider confidential 
or inappropriate for public disclosure.
    You may review comments and other related materials that pertain to 
this notice by any of the following methods:

 Viewing Comments Electronically--Regulations.gov Classic or 
Regulations.gov Beta

    Regulations.gov Classic: Go to https://www.regulations.gov/. Enter 
``Docket ID OCC-2019--0012'' in the Search box and click ``Search.'' 
Click on ``Open Docket Folder'' on the right side of the screen. 
Comments and supporting materials can be viewed and filtered by 
clicking on ``View all documents and comments in this docket'' and then 
using the filtering tools on the left side of the screen. Click on the 
``Help'' tab on the Regulations.gov home page to get information on 
using Regulations.gov. The docket may be viewed after the close of the 
comment period in the same manner as during the comment period.
    Regulations.gov Beta: Go to https://beta.regulations.gov/ or click 
``Visit New Regulations.gov Site'' from the Regulations.gov classic 
homepage. Enter ``Docket ID OCC-2019-0012'' in the Search Box and click 
``Search.'' Click on the ``Comments'' tab. Comments can be viewed and 
filtered by clicking on the

[[Page 70074]]

``Sort By'' drop-down on the right side of the screen or the ``Refine 
Results'' options on the left side of the screen. Supporting Materials 
can be viewed by clicking on the ``Documents'' tab and filtered by 
clicking on the ``Sort By'' drop-down on the right side of the screen 
or the ``Refine Results'' options on the left side of the screen.'' For 
assistance with the Regulations.gov Beta site please call (877)-378-
5457 (toll free) or (703) 454-9859 Monday-Friday, 9 a.m.-5 p.m. ET or 
email to regulations@erulemakinghelpdesk.com.
    The docket may be viewed after the close of the comment period in 
the same manner as during the comment period.
     Viewing Comments Personally: You may personally inspect 
comments at the OCC, 400 7th Street SW, Washington, DC 20219. For 
security reasons, the OCC requires that visitors make an appointment to 
inspect comments. You may do so by calling (202) 649-6700 or, for 
persons who are deaf or hearing impaired, TTY, (202) 649-5597. Upon 
arrival, visitors will be required to present valid government-issued 
photo identification and submit to security screening in order to 
inspect comments.
    Board of Governors of the Federal Reserve System:
    You may submit comments, identified by Docket No. OP-1688, by any 
of the following methods:
     Agency website: http://www.federalreserve.gov. Follow the 
instructions for submitting comments at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm.
     Email: regs.comments@federalreserve.gov. Include the 
docket number in the subject line of the message.
     Fax: (202) 452-3819 or (202) 452-3102.
     Mail: Address to Ann E. Misback, Secretary, Board of 
Governors of the Federal Reserve System, 20th Street and Constitution 
Avenue NW, Washington, DC 20551.
    All public comments will be made available on the Board's website 
at http://www.federalreserve.gov/generalinfo/foia/ProposedRegs.cfm as 
submitted, unless modified for technical reasons or to remove sensitive 
personal identifying information at the commenter's request. 
Accordingly, comments will not be edited to remove any identifying or 
contact information. Public comments may also be viewed electronically 
or in paper form in Room 146, 1709 New York Avenue NW, Washington, DC 
20006, between 9:00 a.m. and 5:00 p.m. on weekdays.
    Federal Deposit Insurance Corporation: You may submit comments, 
identified by RIN 3064-ZA07, by any of the following methods:
     Agency Website: http://www.FDIC.gov/regulations/laws/federal. Follow instructions for submitting comments on the agency 
website.
     Email: Comments@FDIC.gov. Include RIN 3064-ZA07 in the 
subject line of the message.
     Mail: Robert E. Feldman, Executive Secretary, Attention: 
Comments, Federal Deposit Insurance Corporation, 550 17th Street NW, 
Washington, DC 20429.
     Hand Delivery/Courier: Guard station at the rear of the 
550 17th Street building (located on F Street) on business days between 
7:00 a.m. and 5:00 p.m.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
    Instructions: All comments will be posted without change to http://www.fdic.gov/regulations/laws/federal/, including any personal 
information provided. Paper copies of public comments may be ordered 
from the Public Information Center by telephone at (877) 275-3342 or 
(703) 562-2200.
    Securities and Exchange Commission: Comments may be submitted by 
any of the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/proposed.shtml); or
     Send an email to rule-comments@sec.gov. Please include 
File Number S7-14-11 on the subject line.

Paper Comments

     Send paper comments to Secretary, Securities and Exchange 
Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number S7-14-11. This file number 
should be included on the subject line if email is used. To help us 
process and review your comments more efficiently, please use only one 
method. The Commission will post all comments on the Commission's 
internet website (http://www.sec.gov/rules/proposed.shtml). Comments 
are also available for website viewing and printing in the Commission's 
Public Reference Room, 100 F Street NE, Washington, DC 20549, on 
official business days between the hours of 10:00 a.m. and 3:00 p.m. 
All comments received will be posted without change. Persons submitting 
comments are cautioned that the Commission does not redact or edit 
personal identifying information from submissions. You should submit 
only information that you wish to make available publicly.
    Federal Housing Finance Agency: You may submit your written 
comments on the notice, identified by notice number 2019-N-7, by any of 
the following methods:
     Agency Website: www.fhfa.gov/open-for-comment-or-input.
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments. If you submit your 
comments to the Federal eRulemaking Portal, please also send it by 
email to FHFA at RegComments@fhfa.gov to ensure timely receipt by the 
agency. Please include ``QRM Review Input/Notice No. 2019-N-7'' in the 
subject line of the message.
     U.S. Mail, United Parcel Service, Federal Express, or 
Other Mail Service: The mailing address for comments is: Alfred M. 
Pollard, General Counsel, Attention: QRM Review Input/Notice No. 2019-
N-7, Federal Housing Finance Agency, Constitution Center, (OGC) Eighth 
Floor, 400 7th Street SW, Washington, DC 20219.
     Hand Delivery/Courier: The hand delivery address is: 
Alfred M. Pollard, General Counsel, Attention: QRM Review Input/Notice 
No. 2019-N-7, Federal Housing Finance Agency, Constitution Center, 
(OGC) Eighth Floor, 400 7th Street SW, Washington, DC 20219. Deliver 
the package at the Seventh Street entrance Guard Desk, First Floor, on 
business days between 9:00 a.m. and 5:00 p.m.

All comments received by the deadline will be posted for public 
inspection without change, including any personal information you 
provide, such as your name, address, email address, and telephone 
number, on the FHFA website at http://www.fhfa.gov. In addition, copies 
of all comments received will be available for examination by the 
public through the electronic comments docket for this Notice also 
located on the FHFA website.
    Department of Housing and Urban Development: Interested persons are 
invited to submit comments regarding this rule to the Regulations 
Division, Office of General Counsel, Department of Housing and Urban 
Development, 451 7th Street SW, Room 10276, Washington, DC 20410-0500. 
Communications must refer to the docket number and title. There are two 
methods for submitting public comments.
     Submission of Comments by Mail. Comments may be submitted 
by mail to the Regulations Division, Office of General Counsel, 
Department of Housing and Urban Development, 451 7th Street SW, Room 
10276, Washington, DC 20410-0500.

[[Page 70075]]

     Electronic Submission of Comments. Interested persons may 
submit comments electronically through the Federal eRulemaking Portal 
at www.regulations.gov. HUD strongly encourages persons providing 
comments to submit comments electronically. Electronic submission of 
comments allows the submitter maximum time to prepare and submit 
comments, ensures timely receipt by HUD, and enables HUD to make them 
immediately available to the public. Comments submitted electronically 
through the www.regulations.gov website can be viewed by other 
submitters and interested members of the public. Submitters should 
follow the instructions provided on that site to submit comments 
electronically.
     Note: To receive consideration as public comments, 
comments must be submitted through one of the two methods specified 
above. Again, all submissions must refer to the docket number and title 
of the rule.
     No Facsimile Comments. Facsimile (FAX) comments are not 
acceptable.
     Public Inspection of Public Comments. All properly 
submitted comments and communications submitted to HUD will be 
available for public inspection and copying between 8 a.m. and 5 p.m. 
weekdays at the above address. Due to security measures at the HUD 
Headquarters building, an appointment to review the public comments 
must be scheduled in advance by calling the Regulations Division at 
202-708-3055 (this is not a toll-free number). Individuals with speech 
or hearing impairments may access this number via TTY by calling the 
Federal Relay Service at 800-877-8339. Copies of all comments submitted 
are available for inspection and downloading at www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: 
    OCC: Daniel Borman, Senior Attorney, (202) 649-6929 or, for persons 
who are deaf or hearing impaired, TTY, (202) 649-5597, Chief Counsel's 
Office; Ajay Palvia, (202) 649-5505, Senior Financial Economist, Office 
of the Comptroller of the Currency, 400 7th Street SW, Washington, DC 
20219.
    Board: Flora H. Ahn, Special Counsel, (202) 452-2317, David W. 
Alexander, Counsel, (202) 452-287, or Matthew D. Suntag, Senior 
Counsel, (202) 452-3694, Legal Division; Donald N. Gabbai, Lead 
Financial Institutions Policy Analyst, Division of Supervision and 
Regulation, (202) 452-3358; Karen Pence, Assistant Director, Division 
of Research & Statistics, (202) 452-2342; Nikita Pastor, Senior 
Counsel, Division of Consumer & Community Affairs (202) 452-3692; Board 
of Governors of the Federal Reserve System, 20th and C Streets NW, 
Washington, DC 20551.
    FDIC: Rae-Ann Miller, Associate Director, (202) 898-3898; Kathleen 
M. Russo, Counsel, (703) 562-2071, krusso@fdic.gov; or Phillip E. 
Sloan, Counsel, (703) 562-6137, psloan@fdic.gov, Federal Deposit 
Insurance Corporation, 550 17th Street NW, Washington, DC 20429.
    Commission: Arthur Sandel, Special Counsel; Kayla Roberts, Special 
Counsel; Katherine Hsu, Chief, (202) 551-3850, in the Office of 
Structured Finance, Division of Corporation Finance; or Chandler Lutz, 
Economist, (202) 551-6600, in the Office of Risk Analysis, Division of 
Economic and Risk Analysis, U.S. Securities and Exchange Commission, 
100 F Street NE, Washington, DC 20549.
    FHFA: Ron Sugarman, Principal Policy Analyst, Office of Policy 
Analysis and Research, (202) 649-3208, Ron.Sugarman@fhfa.gov, or Peggy 
K. Balsawer, Associate General Counsel, Office of General Counsel, 
(202) 649-3060, Peggy.Balsawer@fhfa.gov, Federal Housing Finance 
Agency, Constitution Center, 400 7th Street SW, Washington, DC 20219. 
The telephone number for the Telecommunications Device for the Deaf is 
(800) 877-8339.
    HUD: Keith Becker, Deputy Assistant Secretary for Risk Management & 
Regulatory Affairs, U.S. Department of Housing & Urban Development, 451 
7th Street SW, Washington, DC 20410; telephone number 202-402-3722 
(this is not a toll-free number). Persons with hearing or speech 
impairments may access this number through TTY by calling the toll-free 
Federal Relay at 800-877-8339.

SUPPLEMENTARY INFORMATION: The credit risk retention regulations, 
codified at 12 CFR part 43; 12 CFR part 244; 12 CFR part 373; 17 CFR 
part 246; 12 CFR part 1234; and 24 CFR part 267 (the Credit Risk 
Retention Regulations), require the OCC, Board, FDIC and Commission, in 
consultation with the FHFA and HUD, to commence a review of the 
following provisions of the Credit Risk Retention Regulations no later 
than December 24, 2019: (1) The definition of qualified residential 
mortgage (QRM) in section _.13 of the Credit Risk Retention 
Regulations; (2) the community-focused residential mortgage exemption 
in section _.19(f) of the Credit Risk Retention Regulations; and (3) 
the exemption for qualifying three-to-four unit residential mortgage 
loans in section _.19(g) of the Credit Risk Retention Regulations. 
Notice of the commencement of this review is hereby given.
    In the Supplementary Information to the Credit Risk Retention 
Regulations the agencies noted that they were committing in the final 
rule to review the QRM definition at regular intervals to consider, 
among other things, changes in the mortgage and securitization market 
conditions and practices, and that this review might include, for 
example, the structures of securitizations, the relationship between, 
and roles undertaken by, the various transaction parties, implications 
for investor protection and financial stability arising from the 
relationship between government-sponsored enterprise (GSE) markets and 
private label markets, and trends in mortgage products in various 
markets and structures, as well as how the QRM definition is affecting 
residential mortgage underwriting and securitization of residential 
mortgage loans under evolving market conditions.\1\ The Supplementary 
Information also stated that the agencies would want the opportunity to 
consider the results of future reviews of, and any changes made to, the 
qualified mortgage definition by the Consumer Financial Protection 
Bureau, any additional regulatory changes affecting securitization that 
are adopted by the agencies, as well as any changes to the structure 
and framework of the GSEs and those markets.\2\ The simultaneous review 
of the community-focused lending exemption and the exemption for 
qualifying three-to-four unit residential mortgage loans will similarly 
allow the agencies to evaluate the advantages and disadvantages of 
these exemptions as their respective markets evolve over time.
---------------------------------------------------------------------------

    \1\ See 79 FR 77601, 77689 (December 24, 2014).
    \2\ See 79 FR 77601, 77689 (December 24, 2014).
---------------------------------------------------------------------------

    The agencies welcome public comments relating to the review of 
these provisions of the Credit Risk Retention Regulations, including 
the matters listed above that might be considered as part of the 
review.

Joseph M. Otting,
Comptroller of the Currency.

    By Order of the Board of Governors of the Federal Reserve 
System.
Ann E. Misback,
Secretary of the Board.
Federal Deposit Insurance Corporation.

    Dated at Washington, DC, on December 10, 2019.
Robert E. Feldman,
Executive Secretary.
    Dated: December 10, 2019.

[[Page 70076]]

    By the Securities and Exchange Commission.
Vanessa A. Countryman,
Secretary.
    Dated: November 21, 2019.
Mark A. Calabria,
Director, Federal Housing Finance Agency.
    Dated: November 21, 2019.

    By the Department of Housing and Urban Development.
John L. Garvin,
General Deputy Assistant Secretary for Housing.
[FR Doc. 2019-27490 Filed 12-19-19; 8:45 am]
BILLING CODE 4810-33-P; 6210-01-P; 3064-01-P; 8070-01-P; 8011-01-P; 
4210-67-P