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Financial Industry Perspectives
contains articles by the
Supervision and Risk Management
Division reporting on a variety of banking issues and topics.
Financial Industry Perspectives will now be distributed exclusively online. Instead of publishing an annual collected issue, new articles will be published on a periodic and continuous basis. You can subscribe to receive E-Alerts when new issues become available. |
2005 2004 2003 2001 2000 1998 1996 1995 1994 1993 1992
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2005
Home Financing
for Low- and Moderate-Income Borrowers: What Are the Trends in Denver?
By James Harvey and Kenneth Spong
Over the last decade, many significant
developments have influenced home lending. Among these developments are the
longest expansion period in U.S. history, pathbreaking technological and
financial innovations, new regulatory and legislative incentives for low-
and moderate-income lending, and continued growth of community organizations
and special home lending programs.
This article takes a look at these trends and their possible effect on home
purchase lending in the Denver metropolitan area between 1992 and 2002. The
article examines changes in home financing across the entire metropolitan
area, as well as among low- and moderate-income borrowers and within low-
and moderate-income neighborhoods. Also analyzed are the contributions of
different types of lenders—banks and thrifts with local banking offices,
banks and thrifts with no Denver banking offices, and independent mortgage
companies.
Among the more noteworthy findings in this analysis is the substantial
growth that has occurred in home purchase lending for the entire Denver
metropolitan area, with a rising share of this lending going to low- and
moderate-income borrowers and neighborhoods. Of further interest is the
growing importance of home lending by banking organizations without
deposit-taking offices in Denver. In particular, the rapid emergence of such
organizations in low- and moderate-income lending provides a strong signal
that this lending is meeting many of the same market tests as other forms of
lending, thus foreshadowing a more continuous flow of financing to lower
income neighborhoods.
Credit Union Growth in the
Tenth Federal Reserve District: How Legal and Regulatory Changes Have
Affected Credit Union Expansion
By Eric Robbins
In the Tenth Federal Reserve District, banks have reported increasing
concern regarding deposit competition from credit unions. In our 2004 Survey
of Community Banks, we asked banks to rate competition from a variety of
sources. Bankers said they anticipate intense competition from several
sources in the coming years. Foremost is competition from other community
banks. However, almost half of all community banks that responded said they
expect very intense or intense deposit competition from credit unions in the
next five years. What factors lead bankers to believe that competition from
credit unions is increasing? This article seeks to address this question by
describing the credit union industry and the historical basis for legal and
regulatory differences between banking and credit union supervision and
regulation, as well as recent legal and regulatory changes that may have
increased competition between credit unions and banks. The article will show
how these changes are affecting credit unions located in the Tenth District
states.