Gov’t to launch FedNow instant payment system

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1. Gov’t to launch FedNow instant payment system

The Federal Reserve is preparing to unveil a real-time payment platform called FedNow later this month, a first-of-its-kind service that purports to increase the speed at which bill payments and money transfers can be made.

The central banking system says FedNow will allow financial transactions to be made nearly instantaneously (<20 seconds), with the service expected to be adopted by dozens of banks and financial institutions.

• “The FedNow Service will be available to depository institutions in the United States and will enable individuals and businesses to send instant payments through their depository institution accounts,” the agency said on its website.

More than 50 financial institutions in total will reportedly participate as “early adopters” of the service during its initial release, including banks such as Wells Fargo, JPMorgan Chase, and Peoples Bank, among others. LINK

2. Wells Fargo, JPMorgan report Q2 2023 mortgage uptick

Despite significant challenges such as high house prices and soaring mortgage rates, both banking giants reported an uptick in origination volume and revenue in Q2 2023.

Wells Fargo saw an 18% quarterly increase in mortgage originations, amounting to $7.8 billion, largely due to a surge in the retail channel, though this figure still marks a 77% year-over-year decline.

At JPMorgan, the quarterly origination volume nearly doubled to $10.1 billion, a promising sign despite being less than half of the $21.9 billion achieved in Q2 2022. An additional $1.1 billion was gained through the acquisition of First Republic Bank. LINK

3. Charted: New listings coming onto the market, according to Realtor.com

According to Realtor.com, there were 26.2% fewer homes listed for sale in June 2023 than in June 2022, and 28.9% fewer than in June 2019.

This limited inventory has fueled competition among buyers, and caused home prices to rise in the first half of the year—the seasonally strong part of the year—in most markets.

4. More Nuggets

The CFPB joined a Maine lawsuit, advocating that a loan's purpose, not its commercial label, determines TILA applicability, challenging a bank's claim that a 'commercial' tag exempts it from the law. LINK

AG Mortgage has offered a $300 million stock-and-cash bid for Western Asset Mortgage, challenging a prior merger agreement between Western Asset and Terra Property Trust. AG Mortgage's offer is equivalent to $9.88 per share. LINK

In June, building supply costs remained stable, reflecting broader inflation trends and contributing to improved industry sentiment, with increased costs in some areas such as softwood lumber and ready-mix concrete being offset by declining prices in other materials like steel-mill goods and gypsum. LINK

Sprout Mortgage is halting a $3.5 million settlement for laid-off workers, citing an involuntary bankruptcy filing posted recently by the shuttered lenders' creditors who are seeking payment. LINK

☀️ See you on Wednesday!

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