DFI Monthly Bulletin – February 2008
Volume 11, Number 8
Commissioner’s Regional Roundtable Meetings
The Department of Financial Institutions (DFI), in conjunction with the Conference of State Bank
Supervisors (CSBS), is planning to host a series of regional roundtable meetings between department
management and bank licensees in 2008. These meetings will be held in several convenient locations
throughout California. The first meeting was held in San Diego on February 28, 2008 with 17 regional
bank CEOs in attendance. Similar roundtable meetings are planned with other Department licensee
The purpose of these small, informal forums is to share information about DFI operations and to
discuss common issues and concerns such as regulatory issues, legislation, examination procedures and
trends, housing and economic conditions, competition, accounting issues and/or any other topic of
mutual interest. The meetings will be kept to 2 ½ hours to enable attendance and accommodate
everyone’s busy schedule.
Invitations to upcoming meetings will be sent out to CEOs in advance of the meetings to keep the group
size small. Should you have any questions about the upcoming meetings, please contact Rita Avalos at
916-322-5967 or HUravalos@dfi.ca.govUH.
Management Change Information Procedure
All licensees are requested to advise DFI of changes to the executive management team by sending an
email to HUlicensing@dfi.ca.govUH. This will ensure that correct contact information is maintained in the
department’s database and on the directories of licensees on the DFI Web site. Financial Code section
1945 requires that banks are required to notify DFI of any change in the managing officer of the bank.
We appreciate your assistance in helping us keep the lines of communication open between the
department and its licensees.
111 Pine Street, Suite 1100, San Francisco, CA 94111-5613 (415) 263-8500
300 South Spring Street, Suite 15513, Los Angeles, CA 90013-1204 (213) 897-2085
1810—13th Street, Sacramento, CA 95814-7118 (916) 322-5966
7575 Metropolitan Drive, Suite 108, San Diego, CA 92108-4421 (619) 682-7227
Consumer Compliance (800) 622-0620
2 Monthly Bulletin February 2008
State Foreclosure Group Releases Mortgage
Servicing Loss Mitigation Performance Report
The State Foreclosure Prevention Working Group, a multi-state task force organized last summer by
Iowa Attorney General Tom Miller to work with subprime mortgage loan servicers to reduce the number
of unnecessary foreclosures by encouraging loan modifications and other sustainable, long-term
solutions, released its first subprime mortgage servicing performance data report on February 7.
The report, which summarizes data from a group of the largest mortgage servicers through October,
outlined five key findings, as follows:
• Seven out of ten seriously delinquent borrowers are not on track for any loss mitigation option.
The lack of interaction between mortgage servicers and homeowners remains a major problem.
While servicers have developed creative outreach efforts and increased staffing, the data shows a
large gap between the number of homeowners needing loss mitigation and the number currently
receiving assistance. Our data suggests that a rising number of loan delinquencies are outpacing
the increase in loss mitigation efforts.
• Servicers have increased their use of loan modifications and other home retention options. For
those delinquent homeowners in contact with servicers, almost half (45%) are working toward a
loan modification. Servicers are increasing their use of longer-term changes to the mortgage loan
versus their earlier reliance on short-term repayment or forbearance agreements.
• Payment resets on hybrid ARMs have not yet been a driving force in foreclosures. A significant
percentage of subprime adjustable rate loans are delinquent before they experience payment
shock from their first adjustment, reflecting weak underwriting or fraud in the origination of the
loan. With so many homeowners struggling to stay afloat prior to rate resets, we need to act
quickly to address these hybrid ARM loans before the payment shock due to the rate reset
triggers further foreclosures.
• Homeowners are helping themselves. Most delinquent loans resolved in October 2007 occurred
due to the homeowner catching up on back payments. As of October, actions by homeowners,
not servicers, have prevented the most foreclosures. This, however, may be a temporary
• The refinance option has nearly evaporated. Historically, serial refinancing was the primary way
that the mortgage industry and homeowners managed delinquencies in subprime loans. Despite
recent interest rate cuts, the mortgage industry will not be able to refinance its way out of this
crisis absent dramatic changes in available loan products or a reversal in home price declines.
The Group, made up of state attorneys general and state banking regulators, collaborated with industry
and federal regulators to develop a uniform data reporting format to collect comparative data to measure
the extent of the foreclosure problem and the servicers’ efforts to respond to it. Consistent and objective
data is necessary to make informed policy decisions and to promote initiatives that could reduce
3 Monthly Bulletin February 2008
Thirteen of the top 20 servicers provided the requested data for the month of October 2007. These
servicers represent approximately 58% of the total subprime servicing market. Reporting companies
serviced 5,110,678 subprime and Alt-A loans. The Group, while emphasizing that the data collection
initiative is a voluntary and cooperative effort, continues to seek cooperation from the servicers that did
not participate in the initial report.
Overall, over 150,000 delinquent loans were in the process of receiving a loan modification or other
home retention accommodation at the end of October.
The State Working Group anticipates future reporting on the data collected from servicers. The State
Working Group will continue to collect monthly data from reporting servicers in order to provide public
information on trends in the servicing industry as we move through this foreclosure crisis.
As this first report was going to press, the State Working Group had collected data for November 2007
servicing activity. A preliminary review of that data suggests that subprime delinquency rates continued
to rise in November.
The Group calls for systematic, long-term solutions to efficiently deal with subprime loans originated in
To access the October report, go to
For more information, contact Robert Brammer, Press Secretary, Iowa Attorney General’s Office,
HUrbrammer@ag.state.ia.usUH 515-281-6699 or Ha Nguyen, Executive Assistant to Deputy Commissioner of
Banks Mark Pearce, North Carolina Office of Commissioner of Banks, hnguyenHU@nccob.orgUH, 919-733
Commercial Bank Activity
245 West Valley Boulevard, San Gabriel, Los Angeles County
(626) 282-9333 (fax)
Officers: Edward Lo, President / Chief Executive Officer
Wilson Ngai, Executive Vice President / Chief Operating Officer
Donald Volkman, Senior Vice President / Chief Credit Officer
Eddie Wada, Senior Vice President / Chief Financial Officer
4 Monthly Bulletin February 2008
New Bank (Continued)
11010 Artesia Boulevard, Cerritos, Los Angeles County
Correspondent: Russell W. Bushore
Carpenter & Company
Five Park Plaza, Suite 950
Irvine, CA 92614
Purchase of Partial Business Unit
Nara Bank, Los Angeles, California, to acquire the New Jersey branch office of The Provident Bank,
Brick Township, New Jersey
Change of Name
Golden State Business Bank, Upland, to change its name to Golden State Bank
Premium Finance Company Activity
Voluntary Surrender of License
G.A.S. Premium Finance, Inc.
Imperial Premium Finance, Inc.
Premium Finance, Inc.
Summit Premium Finance Company
5 Monthly Bulletin February 2008
Foreign (Other Nation) Bank Activity
Voluntary Surrender of License
Barclays Bank PLC
Foreign (Other State) Bank Activity
American Enterprise Bank (Facility – Insured Bank)
8775 Sierra College Boulevard, Granite Bay, Placer County
Credit Union Activity
Field of Membership
One credit union received approval to add three new fields of membership during January 2008.
Three credit unions received approval for three bylaw amendments during January 2008.
Glass Containers Credit Union, Antioch, to merge with and into California Pacific Federal Credit Union,
Transmitter of Money Abroad Activity
Trans-Fast Remittance, Inc.
6 Monthly Bulletin February 2008
Issuer of Travelers Checks Activity
Voluntary Surrender of License
Interpayment Services, Limited
CAROL D. CHESBROUGH
Interim Commissioner of Financial Institutions
Bulletin for Month ended
February 2008, issued pursuant
to Financial Code section 258
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