Many supply chain finance programs are structured on what is called a “buyer-led” or “buyer-focused” basis.  In certain of these types of programs, although the bank or other financier providing the program (the “Finance Provider”) may purchase accounts receivable represented by invoices or otherwise provide funding to a number of suppliers, the true customer of the Finance Provider is a single corporate buyer of goods and services (the “Buyer”) for whom the program has been…

In late December 2020, New York Governor Andrew Cuomo signed S.B. 5470 into law, which will impose a range of Truth in Lending Act-like disclosure requirements on providers of commercial financing in amounts of $500,000 or less. The law will have a significant impact on providers beyond traditional commercial lenders, as it broadly defines “commercial financing” to include the providers, and third-party solicitors, of sales-based financing, closed-end commercial financing, open-end commercial financing, factoring transactions and…

I was only 9 years old when Jan and Dean in 1963 released their hit song “Dead Man’s Curve.” I thought about this song when I read the Conference of State Bank Supervisors’ (“CSBS”) Proposed Regulatory Prudential Standards for Nonbank Mortgage Servicers (the “Proposal”). Published for comment on September 29 with comments due by the end of the year, the Proposal seeks to impose on US nonbank mortgage servicers many of the safety and soundness…

The Consumer Financial Protection Bureau (“CFPB”) issued two relatively welcome surprises yesterday. First, along with ditching a debt-to-income ratio (“DTI”) ceiling, the agency expanded its proposed general Qualified Mortgage (“QM”) to include loans up to 2.25 percentage points over the average prime offer rate. Mortgage lenders can opt in to the new QM as early as 60 days after the rule is published (so, likely by late February 2021), although compliance becomes mandatory July 1,…

In this Winter 2020 edition of our Structured Finance Bulletin, we provide updates on recent legal and regulatory developments in the consumer loan space as well asthe latest on the transition from LIBOR. We also analyze the Federal Housing Agencies and GSE updates to COVID-19 relief measures for mortgage loan borrowers and US M&A considerations for Fintech Businesses during the COVID-19 pandemic. Finally, we review recent Volcker Rule revisions and developments in the EU Securitisation Regulation…

Should US state nonbank mortgage servicers be subject to “safety and soundness” standards of the type imposed by federal law on insured depository institutions, even though the nonbanks do not solicit and hold customer funds in federally insured deposit accounts or pose a direct risk of a government bailout? Well, state mortgage banking regulators think so. On September 29, 2020, the Conference of State Bank Supervisors, an organization made up of state regulators, released proposed…

Financial Statement Disclosure of Supply Chain and other Trade Payables Programs Trade payables programs have in recent years increased greatly in popularity among both large and small companies. While originally the sole domain of the large global banks and firmly based on a fairly straightforward reverse factoring model, these programs are now offered by banks and many non-bank market participants using a variety of structures and funding sources. As we discussed in our post on…