Sarah Bloom Raskin urges mortgage servicing reforms

Sarah Bloom Raskin hasn’t been at her new job long, but she’s already making herself heard.

The Senate confirmed Maryland’s former commissioner of financial oversight to a post on the Federal Reserve Board in September and she started work there on Oct. 4.

Last week, Raskin said mortgage servicers are not doing enough to help homeowners avoid foreclosures and the industry needs “serious and sustained reform,” the Wall Street Journal reported in its Real Time Economics blog. (And a hat tip to them for reporting this.)

“Many may view these procedural flaws as trivial, technical, or inconsequential, but I consider them to be part of a deeper, systemic problem and am gravely concerned,” Raskin said, according to the Journal.

Raskin had been Maryland’s top banking regulator since 2007 and had previously worked at the New York Fed.  Her former deputy, Mark Kaufman, took the top financial regulation spot on Sept. 30.

Banking local bill short on time

The bill that would help small, local banks win more state banking contracts is still alive in these waning days of the legislative session, but time is running short.

Del. Bill Frick, the bill’s sponsor, said Thursday the focus of the bill is still the same, but its mechanics had changed. Originally, HB 1325 would have given local banks a pricing preference when bidding on state contracts. Now, Frick said, it would require the treasurer to consider whether a bank is local bank when reviewing bids.

“The goal for me was to move the business off Wall Street and into local banks,” said Frick, D-Montgomery. “Bank of America is going to invest their money in Dubai. Sandy Spring Bank is going to invest their money in Maryland.”

Del. Dan Morhaim, D-Baltimore County, said the bill is still being worked on by his subcommittee and is in much better shape that it was when originally submitted. But Morhaim wouldn’t hazard a guess regarding the bill’s prospects.

The legislature wraps up its 90-day session on Monday and for Frick’s bill to pass, it would have to come before the House of Delegates twice and the Senate three times — and survive committee votes in both chambers.