What changed in this filing

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Item 1. Business

2026-03-27 compared with 2025-03-28 · 78 added, 68 removed, 392 unchanged (27% of the section changed)

As used in this report, the terms “we”, “us”, “our”, “Northpointe”, and “Company” mean Northpointe Bancshares, Inc.

and its subsidiaries, unless the context indicates another meaning.

and its subsidiary, unless the context indicates another meaning.

The term “Bank” means Northpointe Bank.

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(“the Company”) is a bank holding company headquartered in Grand Rapids, Michigan and registered under the Bank Holding Company Act of 1956.

The Company completed an initial public offering of common stock in February 2025 as an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (“the JOBS Act”).

Our common stock is listed on the New York Stock Exchange under the symbol “NPB”.

Our Bank was founded in 1999 as a focused mortgage portfolio lender primarily operating in the midwestern states of Michigan, Ohio and Indiana.

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Our nationwide presence has enabled us to have clients in all 50 states and the District of Columbia.

As of December 31, 2024, we had $5.22 billion in assets, $4.64 billion in gross loans, including held for investment (“HFI”) and held for sale (“HFS”), $3.42 billion of deposits and $462.5 million of stockholders’ equity.

We have originated more than $190 billion in home loan financings over the last 10 years, making us one of the largest mortgage-focused banks in the United States.

Today, we are the largest bank headquartered in the state of Michigan, one of the largest providers of mortgage warehouse financing, and one of the only mortgage-focused banks in the country.

In the large and fragmented mortgage marketplace, we believe we are well-positioned as a specialty bank that uses a widely accepted and growing digitally-enabled platform to serve the borrowing and payment needs of increasingly sophisticated mortgage warehouse clients and the rapidly evolving demands of professional mortgage originators and retail borrowers.

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We offer financial products and services through our two primary business segments, Mortgage Purchase Program and Retail Banking.

Mortgage Purchase Program (“MPP”) — Through our Mortgage Purchase Program business (which we refer to as Mortgage Purchase Program, or “MPP”), we provide independent mortgage banking platforms nationwide with an alternative to traditional mortgage warehouse lending.

Mortgage Purchase Program (“MPP”).

Through our Mortgage Purchase Program business (which we refer to as “MPP”), we provide independent mortgage banking platforms nationwide with an alternative to traditional mortgage warehouse lending.

MPP utilizes a collateralized mortgage purchase facility, marketed to independent mortgage bankers nationwide.

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Our MPP facilities provide a key source of liquidity to the residential mortgage marketplace.

Retail Banking — Our Retail Banking business includes residential lending, digital deposit banking and loan servicing.

(a) Residential Lending — Our residential lending division provides a comprehensive range of financing options for home purchases and refinancing, serving borrowers nationwide through two main channels:

Retail Banking.

Our Retail Banking business includes residential lending, digital deposit banking and loan servicing.

(a) Residential Lending.

Our residential lending division provides a comprehensive range of financing options for home purchases and refinancing, serving borrowers nationwide through two main channels:

Consumer Direct and Traditional Retail.

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Through our point of sale platform, borrowers can easily apply for loans, upload documents, speak with loan officers, track progress, and make payments — all from one secure, user-friendly interface.

Northpointe offers a broad spectrum of loan programs, including conventional, government, and non-QM loans, catering to a wide variety of borrowers’ needs.

As a direct seller/servicer to Fannie Mae, Freddie Mac, and Ginnie Mae, we ensure competitive rates and efficient processing.

Northpointe offers a broad spectrum of loan programs, including conventional, government, and non-Qualified Mortgage (“QM”) loans, catering to a wide variety of borrowers’ needs.

As a direct seller/servicer to Fannie Mae, Freddie Mac, Ginnie Mae and other end investors, we ensure competitive rates and efficient processing.

With a focus on speed, quality, and client satisfaction, we leverage our customized technology in our underwriting process, leading to faster decisions and document delivery.

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The borrower benefits through reduced interest charges on the credit line as a result of the daily sweep from the linked bank checking account.

Our digitized loan origination processes give borrowers and origination professionals easy access to our proprietary Apps and POS support features to quickly, intelligently, and securely gather personal and loan information.

Our digitized loan origination processes give borrowers and origination professionals easy access to our proprietary application and point-of-sale support features to quickly, intelligently, and securely gather personal and loan information.

Borrowers also have access to account advisors to help borrowers on their journey when they need human assistance.

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Lock & Shop, Temporary Buydown, TrueApproval, Delayed Financing, and Rate Refresh along with Jumbo, Renovation, traditional HELOC, VA Loans and our first-lien home equity loans.

(b) Digital Deposit Banking — Our automated account opening, direct to customer deposit platform and product suite provide our depositors with effective, competitive, modern digital banking services and provide us with reliable access to deposit funding.

(b) Digital Deposit Banking.

Our automated account opening, direct to customer deposit platform and product suite provide our depositors with effective, competitive, modern digital banking services and provide us with reliable access to deposit funding.

We offer and utilize the full spectrum of deposit products, including noninterest- bearing accounts, savings, money-market demand accounts;

but we focus upon term CDs.

Our digital platform (supported by one central branch) offers very competitive rates that allow us to attract deposits at an attractive all-in cost to us.

Historically, the majority of our time deposits were term CDs that were structured with intermediate (close to one year) maturities and priced at rates that are in the top 25 of average nationwide industry deposit rates for similar maturities.

Beyond term and rate, we successfully compete with other digital- only banks by offering a simple online account opening experience, friendly features such as ATM fee rebates, no/low overdraft fees and a dynamic mobile banking solution.

In addition to retail deposits, we offer commercial deposits which are primarily noninterest bearing custodial deposits related to our loan servicing business.

As of December 31, 2024, our deposit balances were $3.42 billion, of which $208.9 million were non-interest bearing accounts, primarily comprised of servicing-related custodial deposits and deposits from our MPP clients.

Custodial deposits and deposits from our MPP clients are both contractually obligated to remain at Northpointe unless we are not well-capitalized.

(c) Loan Servicing — We service and sub-service specialized loans on behalf of our borrowers and investors, which includes a monthly fee paid by the investor.

but we typically focus upon term CDs.

Our digital platform (supported by one central branch) offers very competitive rates (typically priced in the top 25 of average nationwide industry deposit rates for similar maturities) that allow us to attract deposits at an attractive all-in cost to us.

We successfully compete with other digital-only banks by offering a simple online account opening experience, friendly features such as ATM fee rebates, no/low overdraft fees and a dynamic mobile banking solution.

In addition to retail deposits, we offer commercial deposits which are primarily noninterest bearing custodial deposits related to our loan servicing business or deposits from our MPP clients.

We service and sub-service specialized loans on behalf of our borrowers and investors, which includes a monthly fee paid by the investor.

In 2024, we refined our servicing strategy to focus solely on in-house servicing of select loan types such as first-lien home equity lines which are tied seamlessly to a demand deposit sweep account through our proprietary technology;

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and may also include negotiations of loan workouts and modifications upon default or other proceedings.

Critical to the success of our servicing platform is being an approved seller/servicer for the largest government-related mortgage agencies (FNMA, FNMA, FHLMC, FHLB) as well as being rated by a third-party rating agency (Fitch) as a qualified servicer for investor-owned securitizations and other non-agency products.

We completed an initial public offering of our common stock in February 2025 as an emerging growth company under the Jumpstart Our Business Startups Act of 2012 (“the JOBS Act”).

Our common stock is listed on the New York Stock Exchange under the symbol “NPB”.

Critical to the success of our servicing platform is being an approved seller/servicer for the largest government-related mortgage agencies (Federal National Mortgage Association “FNMA”, Federal Home Loan Mortgage Corporation “FHLMC”, Federal Home Loan Bank “FHLB”) as well as being rated by a third-party rating agency (Fitch) as a qualified servicer for investor-owned securitizations and other non-agency products.

While our headquarters is located in Grand Rapids, Michigan, our market area is nationwide.

Our delivery systems are primarily digital and are available to clients nationwide;

and we provide our staff with loan production offices across 23 cities

in 15 states and support them through our centralized operating center in Grand Rapids, Michigan.

Our nationwide presence has enabled us to have clients in all 50 states and the District of Columbia.

Our delivery systems are primarily digital, enabling clients across all 50 states and the District of Columbia to access our mortgage and deposit products.

In addition to our digital platform, we operate loan production offices in 25 cities across 15 states, which support our lending activities and are backed by our centralized operating center in Grand Rapids.

This structure allows us to efficiently serve a geographically diverse customer base and participate broadly in the national residential mortgage market.

We compete in a number of areas, including deposit banking, residential mortgage lending and servicing, and mortgage warehouse lending.

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We compete with other nondepository financial institutions and community banks, thrifts and credit unions.

In addition, we compete with large banks and other financial intermediaries, such as consumer finance companies, mortgage banking companies, and online banks.

addition, we compete with large banks and other financial intermediaries, such as consumer finance companies, mortgage banking companies, and online banks.

Competition from financial technology (“fintech”) companies and technology-enabled financial service providers has also increased and continues to intensify as these providers offer digital-first platforms for lending, payments, and deposit-like products that may compete directly with traditional banking services.

Continued consolidation and rapid technological changes within the financial services industry will likely change the nature and intensity of competition, but also will create opportunities for the Company to demonstrate and leverage its competitive advantages.

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These nontraditional financial service providers have been successful in developing digital and other products and services that effectively compete with traditional banking services, but are in some cases subject to fewer regulatory restrictions than banks and bank holding companies, allowing them to operate with greater flexibility and lower cost structures.

Fintech companies, digital payment platforms, and other non‑bank financial service providers increasingly offer alternatives to traditional bank deposits and payment services, which may reduce customer reliance on traditional banking relationships and contribute to deposit disintermediation.

Advances in real‑time payments and customer expectations for instantaneous funds availability may further intensify competitive pressures on banks, particularly those offering digital deposit products.

Certain fintech competitors may also benefit from operating under different regulatory frameworks or reduced capital, liquidity, or supervisory requirements, which can allow for faster product development cycles, lower operating costs, or more flexible pricing relative to traditional banks.

Competitors include not only financial institutions based in Michigan, but also a number of large out-of-state and foreign banks, bank holding companies and other financial institutions that have an established market presence in Michigan or that offer internet-based products.

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Our board of directors, both directly and through its committees, is responsible for overseeing our risk management processes, including routinely conducting enterprise risk management assessments, cyber, BSA/anti-money laundering and third-party risk assessments, with each of the committees of our board of directors assuming a different and important role in overseeing the management of the risks we face.

Our risk management processes are designed to address both existing and emerging risks, including those arising from changes in economic conditions, technology, cybersecurity threats, third-party relationships and the evolving regulatory environment.

The Audit Committee of our board of directors is responsible for overseeing risks associated with financial matters (particularly financial reporting, accounting practices and policies, disclosure controls and procedures and internal control over financial reporting).

The Compensation Committee of our board of directors has primary responsibility for risks and exposures associated with our compensation policies, plans and practices, regarding both executive compensation and our compensation structure generally.

In particular, our Compensation Committee, in conjunction with our President and Chief Executive Officer and other members of our management, as appropriate, reviews our incentive compensation arrangements to ensure these programs are consistent with applicable laws and regulations, including safety and soundness requirements, and do not encourage imprudent or excessive risk-taking by our employees.

In particular, our Compensation Committee, in conjunction with our President and our Chief Executive Officer and other members of our management, as appropriate, reviews our incentive compensation arrangements to ensure these programs are consistent with applicable laws and regulations, including safety and soundness requirements, and do not encourage imprudent or excessive risk-taking by our employees.

The Corporate Governance and Nominating Committee of our board of directors oversees risks associated with the independence of our board of directors and potential conflicts of interest.

Our senior management is responsible for implementing our risk management processes, including by assessing and managing the risks we face, including strategic, operational, regulatory, investment and execution risks, on a day-to-day basis, and reporting to our board of directors regarding our risk management processes.

Our senior management is also responsible for creating and recommending to our board of directors for approval appropriate risk appetite metrics reflecting the aggregate

levels and types of risk we are willing to accept in connection with the operation of our business and pursuit of our business objectives.

Our senior management is also responsible for creating and recommending to our board of directors for approval appropriate risk appetite metrics reflecting the aggregate levels and types of risk we are willing to accept in connection with the operation of our business and pursuit of our business objectives.

The role of our board of directors in our risk oversight is consistent with our leadership structure, with our President, Chief Financial Officer and Chief Executive Officer, along with the other members of senior management having responsibility for assessing and managing our risk exposure, and our board of directors and its committees providing oversight in connection with those efforts.

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We provide a competitive compensation and benefits program to help meet the needs of our employees.

Our compensation programs are designed to be market-competitive and performance-based, while remaining consistent with applicable laws, regulations and safety and soundness considerations.

In addition to salaries, these programs include annual bonus opportunities, a 401(k) plan with an employer matching contribution, healthcare and insurance benefits, flexible spending accounts, paid time off and family leave and an employee assistance program.

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The results of the examination are confidential.

Supervision and regulation of banks, their holding companies, and affiliates is intended primarily for the protection of depositors and clients, the DIFS of the FDIC, and the U.S.

Supervision and regulation of banks, their holding companies, and affiliates is intended primarily for the protection of depositors and clients, the Deposit Insurance Fund (“DIF”) of the FDIC, and the U.S.

banking and financial system rather than holders of our securities.

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Under federal and state laws and regulations pertaining to the safety and soundness of insured depository institutions, state banking regulators, the Federal Reserve, and separately the FDIC as the insurer of bank deposits have the authority to compel or restrict certain actions on our part if they determine that we have insufficient capital or other resources, or are otherwise operating in a manner that may be deemed to be inconsistent with safe and sound banking practices.

Under this authority, our regulators can require us or our subsidiaries to enter into informal or formal supervisory agreements, including board resolutions, memoranda of understanding, written agreements, and consent or cease and desist orders pursuant to which we would be required to take identified corrective actions to address cited concerns and to refrain from taking certain actions.

Under this authority, our regulators can require us or our subsidiary to enter into informal or formal supervisory agreements, including board resolutions, memoranda of understanding, written agreements, and consent or cease and desist orders pursuant to which we would be required to take identified corrective actions to address cited concerns and to refrain from taking certain actions.

If we become subject to and are unable to comply with the terms of any regulatory actions or directives, supervisory agreements or orders, then we could become subject to additional, heightened supervisory actions and orders, possibly including prompt corrective action restrictions and/or other regulatory actions, including prohibitions on the payment of dividends on our common stock and preferred stock.

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A bank holding company, such as us, is required to act as a source of financial and managerial strength to its subsidiary bank.

The term “source of financial strength” means the ability of a company, such as us, that directly or indirectly owns or controls an insured depository institution, such as the Bank, to provide financial assistance to such insured depository institution in the

event of financial distress.

The appropriate federal banking agency for the depository institution (in the case of the Bank, this agency is the FDIC) may require reports from us to assess our ability to serve as a source of strength and to enforce compliance with the source of strength requirements by requiring us to provide financial assistance to the Bank in the event of financial distress.

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A BHC is generally required to give the Federal Reserve prior written notice of any purchase or redemption of its own then-outstanding equity securities if the gross consideration for the purchase or redemption, when combined with the net consideration paid for all such purchases or redemptions during the preceding twelve months, is equal to 10.0% or more of the company’s consolidated net worth.

The Federal Reserve may disapprove such a purchase or redemption if it determines that the proposal would constitute an unsafe and unsound practice, or would violate any law, regulation, Federal Reserve order or directive, or any condition imposed by, or written agreement with, the Federal Reserve.

directive, or any condition imposed by, or written agreement with, the Federal Reserve.

The Federal Reserve has adopted an exception to this approval requirement for BHCs that meet certain “well-capitalized” and “well-managed” standards and are not the subject of any unresolved supervisory issue.

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As of December 31, 2025, these rules have not been implemented, although the SEC did adopt final rules implementing the clawback provisions of the Dodd-Frank Act in 2022.

and the Bank have undertaken efforts to ensure that our incentive compensation plans do not encourage inappropriate risks, consistent with three key principles - that incentive compensation arrangements should appropriately balance risk and financial rewards, be compatible with effective controls and risk management, and be supported by strong corporate governance.

We and the Bank have undertaken efforts to ensure that our incentive compensation plans do not encourage inappropriate risks, consistent with three key principles - that incentive compensation arrangements should appropriately balance risk and financial rewards, be compatible with effective controls and risk management, and be supported by strong corporate governance.

Capital Requirements

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In addition, undercapitalized depository institutions may not accept brokered deposits absent a waiver from the FDIC, are subject to growth limitations, and are required to submit capital restoration plans for regulatory approval.

A depository institution's holding company must guarantee any required capital restoration plan up to an amount equal to the lesser of 5% of the depository institution's assets at the time it becomes undercapitalized or the amount of the capital deficiency when the institution fails to comply with the plan.

A depository institution's holding company must guarantee any required capital restoration plan up to an amount equal to the lesser of 5% of the depository institution's assets at

the time it becomes undercapitalized or the amount of the capital deficiency when the institution fails to comply with the plan.

Federal banking agencies may not accept a capital plan without determining, among other things, that the plan is based on realistic assumptions and is likely to succeed in restoring the depository institution's capital.

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Payment of Dividends

We are a legal entity separate and distinct from the Bank and our other subsidiaries.

The primary sources of funds for our payment of dividends to our stockholders are cash on hand and dividends from the Bank and our non-bank subsidiaries.

We are a legal entity separate and distinct from the Bank.

The primary sources of funds for our payment of dividends to our stockholders are cash on hand and dividends from the Bank.

Various federal and state statutory provisions and regulations limit the amount of dividends that the Bank may pay.

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• it will not meet, or is in danger of not meeting, its minimum regulatory capital adequacy ratios.

Additional information about restrictions on payment of dividends by the Bank may be found in Item 8 of this report in Notes 1 and 17 to the Consolidated Financial Statements.

Additional information about restrictions on payment of dividends by the Bank may be found in Item 8 of this report in the Notes to the Consolidated Financial Statements.

Regulation of the Bank

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Loans and other extensions of credit from the Bank to the Company or any affiliate generally are required to be secured by eligible collateral in specified amounts.

In addition, any transaction between the Bank and the Company or any affiliate are required to be on an arm’s length basis.

In addition, any transaction between the Bank and the Company or any affiliate is required to be on an arm’s length basis.

Federal banking laws also place similar restrictions on certain extensions of credit by insured banks, such as the Bank, to their directors, executive officers, and principal stockholders.

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The assessment base for the special assessment is equal to estimated uninsured deposits reported as of December 31, 2022, adjusted to exclude the first $5 billion, to be collected at an annual rate of approximately 13.4 basis points for an anticipated total of eight quarterly assessment periods, beginning the first quarterly assessment period of 2024.

We estimate our annual assessment rate to be 13 basis points in 2025.

Based on current information and assumptions, we estimate our annual assessment rate to be 13 basis points in 2026.

Insurance of deposits may be terminated by the FDIC upon a finding that the institution has engaged in unsafe and unsound practices, is in an unsafe or unsound condition to continue operations, or has violated any applicable law, regulation, rule, order or condition imposed by a bank’s federal regulatory agency.

In addition, the Federal Deposit Insurance Act provides that, in the event of the liquidation or other resolution of an insured depository institution, the claims of depositors of the institution, including the claims of the FDIC as subrogee of insured depositors, and certain claims for administrative expenses of the FDIC as a receiver, will have priority over other general unsecured claims against the institution, including those of the parent bank holding company.

In addition, the Federal Deposit Insurance Act provides that, in the event of the liquidation or other resolution of an insured depository institution, the claims of depositors of the institution,

including the claims of the FDIC as subrogee of insured depositors, and certain claims for administrative expenses of the FDIC as a receiver, will have priority over other general unsecured claims against the institution, including those of the parent bank holding company.

Standards for Safety and Soundness

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and (vi) asset quality.

The federal banking agencies have adopted regulations and Interagency Guidelines Establishing Standards for Safety

and Soundness to implement these required standards.

The federal banking agencies have adopted regulations and Interagency Guidelines Establishing Standards for Safety and Soundness to implement these required standards.

These guidelines set forth the safety and soundness standards used to identify and address problems at insured depository institutions before capital becomes impaired.

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FinCEN has adopted rules that require financial institutions to obtain beneficial ownership information with respect to legal entities with which such institutions conduct business, subject to certain exclusions and exemptions.

FinCEN has adopted a beneficial ownership information reporting framework under the Corporate Transparency Act, which has been subject to subsequent regulatory modifications and currently applies on a limited basis, and financial institutions continue to be subject to existing customer due diligence requirements under applicable law.

Bank regulators are focusing their examinations on anti-money laundering compliance, and we continue to monitor and augment, where necessary, our anti-money laundering compliance programs.

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The Bank has a rating of “Satisfactory” in its most recent CRA evaluation.

On October 24, 2023, the Office of the Comptroller of the Currency (“OCC”), Federal Reserve, and FDIC issued a final rule to modernize their respective CRA regulations.

The revised rules substantially alter the methodology for assessing compliance with the CRA, with material aspects taking effect January 1, 2026 and revised data reporting requirements taking effect January 1, 2027.

Among other things, the revised rules evaluate lending outside traditional assessment areas generated by the growth of non-branch delivery systems, such as online and mobile banking, apply a metrics-based benchmarking approach to assessment, and clarify eligible CRA activities.

In 2023, the Federal Reserve, OCC and FDIC issued a final rule to modernize their respective CRA regulations.

The revised rules would substantially alter the methodology for assessing compliance with the CRA, with material aspects taking effect January 1, 2026 and revised data reporting requirements taking effect January 1, 2027.

The revised CRA regulations have been subject to an injunction since March 29, 2024.

The effective dates will be extended for each day the injunction remains in place, pending the resolution of the lawsuit.

On July 16, 2025, the Federal Reserve, OCC and FDIC issued a joint proposal to rescind the 2023 modernization rule.

The agencies continued to apply the CRA rules as they existed before the 2023 modernization, considering the injunction and pending finalization of the rescission of the modernization rule.

Anti-Tying Restrictions

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In addition to numerous disclosure requirements, the Dodd-Frank Act imposed new standards for mortgage loan originations on all lenders, including banks and savings associations, in an effort to strongly encourage lenders to verify a borrower’s ability to repay, while also establishing a presumption of compliance for certain “qualified mortgages.” In addition, the Dodd-Frank Act generally required lenders or securitizers to retain an economic interest in the credit risk relating to loans that the lender sells, and other asset-backed securities that the securitizer issues, if the loans do not comply with the ability-to-repay standards described below.

The risk retention requirement generally is 5.0%, but the statute and its implementing regulations, exempt certain transactions from the requirement.

The risk retention requirement generally is 5.0%, but the statute and its implementing

regulations, exempt certain transactions from the requirement.

The CFPB’s rules have impacted our operations, and have resulted in higher compliance costs for the Bank.

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The California Homeowner Bill of Rights

pursuing foreclosure and (iv) allows for injunctions against foreclosure until violations are corrected and permits civil penalties (including monetary damages) against servicers that file multiple inaccurate mortgage documents or otherwise violate California law.

The California Homeowner Bill of Rights, which became effective on January 1, 2013 and was amended effective January 1, 2019, among other measures (i) prohibits “dual track” foreclosures (servicers will be required to halt the foreclosure process while any modification is being considered), (ii) creates a single point of contact for homeowners while negotiating a loan modification, (iii) expands upon notice requirements to a borrower before taking action on a loan modification application or pursuing foreclosure and (iv) allows for injunctions against foreclosure until violations are corrected and permits civil penalties (including monetary damages) against servicers that file multiple inaccurate mortgage documents or otherwise violate California law.

The California Homeowner Bill of Rights is likely to extend foreclosure times in California and lead to increased litigation of the foreclosure process.

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Named defendants in these cases have included numerous participants within the secondary mortgage market, including some securitization trusts.

All of the Mortgage Loans Originated by our Bank Are Subject to the “Know Before You Owe” TRID Disclosures

All of our mortgage loans are subject to the CFPB’s Know Before You Owe TRID rule, which became effective for mortgage loans whose applications were received on or after October 3, 2015.

Substantially all of the Mortgage Loans Originated by our Bank Are Subject to the “Know Before You Owe” TRID Disclosures

Substantially all of our mortgage loans are subject to the CFPB’s Know Before You Owe TRID rule, which became effective for mortgage loans whose applications were received on or after October 3, 2015.

The purpose of the TRID rule was to reconcile overlapping disclosure obligations under TILA and RESPA and to provide for integrated closing disclosure and loan estimate forms that would satisfy those requirements under both TILA and RESPA.

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Revised QM Rules

On December 10, 2020, the CFPB, issued the revised qualified mortgage rules (the “QM Rules”) that replaced Appendix Q and the strict 43.0% debt-to-income ratio (“DTI”) underwriting threshold with a priced-based “Qualified Mortgage Loan” definition.

The revised QM Rules also terminated the “QM Patch,” under which certain loans eligible for purchase by Fannie Mae and Freddie Mac do not have to be underwritten to Appendix Q or satisfy the capped 43.0% DTI requirement.

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Compliance with the revised QM rules became mandatory on October 1, 2022.

On the same day, the CFPB also issued a final “Seasoned QM” rulemaking that creates a pathway to “safe harbor” Qualified Mortgage (“QM”) status for performing non-QM and “rebuttable presumption” QM first lien loans that meet certain performance criteria portfolio requirements over a seasoning period of at least 36 months and that satisfy certain product restrictions, points and fees limits, and underwriting requirements prior to consummation.

On the same day, the CFPB also issued a final “Seasoned QM” rulemaking that creates a pathway to “safe harbor” QM status for performing non-QM and “rebuttable presumption” QM first lien loans that meet certain performance criteria portfolio requirements over a seasoning period of at least 36 months and that satisfy certain product restrictions, points and fees limits, and underwriting requirements prior to consummation.

The “Seasoned QM” rule became effective with respect to applications received on or after March 1, 2021.

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in March 2012.

The servicing standards outlined in the settlement agreement include (i) preventing mortgage servicers from engaging in robo-signing and other improper foreclosure practices, (ii) requiring servicers to offer loss mitigation alternatives to borrowers before pursuing foreclosure, (iii) increasing the transparency of the loss mitigation process, (iv) imposing timelines for servicers to respond to borrowers and (v) restricting the practice of “dual tracking,” where foreclosure is initiated despite the borrower’s engagement in a loss mitigation process.

loss mitigation process, (iv) imposing timelines for servicers to respond to borrowers and (v) restricting the practice of “dual tracking,” where foreclosure is initiated despite the borrower’s engagement in a loss mitigation process.

The CFPB Servicing Rules, among other things, incorporate many of the provisions of the servicing settlement discussed above, targets early intervention with borrowers following initial delinquency and imposes detailed requirements applicable in each step of the Servicer’s loss mitigation process.

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The 2016 Final Servicing Rule Amendments could result in increased delays in foreclosure or the inability to foreclose, which could in turn result in delays in payments on, or losses in respect of, the mortgage loans originated by our Bank.

On October 30, 2020, the CFPB issued a final rule to restate and clarify prohibitions on harassment and abuse, false or misleading representations, and unfair practices by debt collectors when collecting consumer debt.

The rule focuses on debt collection communications and gives consumers more control over how often and through what means debt collectors can communicate with them regarding their debts.

The rule also clarifies how the protections of the Fair Debt Collection Practices Act, which was passed in 1977, apply to newer communication technologies, such as email and text messages.

The final rule also contains provisions on disputes, and record retention, among other topics.

The rule took effect on November 21, 2020.

The CFPB issued a second debt collection final rule focused on consumer disclosures in December 2020.

The second rule, issued in December 2020, clarifies disclosures debt collectors must provide to consumers at the beginning of collection communications.

The second rule also prohibits debt collectors from suing or threatening to sue consumers on time barred debt.

Additionally, the second rule requires debt collectors to take specific steps to disclose the existence of a debt to consumers before reporting information about the debt to a consumer reporting agency.

Both rules took effect on November 30, 2021.

On July 10, 2024, the CFPB proposed a rule to amend provisions of the CFPB Servicing Rules to significantly revamp requirements relating to borrowers experiencing payment difficulties (the “Proposed Rule”).

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The CFPB accepted comments on the Proposed Rule through September 9, 2024.

The CFPB may finalize, modify, or withdraw the Proposed Rule, or adopt related guidance, during 2026, and any such actions could require changes to mortgage servicing practices and may increase compliance costs.

CFPB Debt Collection Rules

On October 30, 2020, the CFPB issued a final rule to amend Regulation F, which implements the fair Debt Collection Practices Act (“FDCPA”), passed in 1977, to restate and clarify prohibitions on harassment and abuse, false or misleading representations, and unfair practices by debt collectors when collecting consumer debt (the “Debt Collection Rule”).

The Debt Collection Rule focuses on debt collection communications and gives consumers more control over how often and through what means debt collectors can communicate with them regarding their debts.

The Debt Collection Rule also clarifies how the protections of the FDCPA apply to newer communication technologies, such as email and text messages.

The Debt Collection Rule also contains provisions on disputes, and record retention, among other topics.

The rule took effect on November 21, 2020.

The CFPB issued a second debt collection final rule focused on consumer disclosures in December 2020.

The second rule, issued in December 2020, clarifies disclosures debt collectors must provide to consumers at the beginning of collection communications and also prohibits debt collectors from suing or threatening to sue consumers on time barred debt.

Both rules took effect on November 30, 2021.

Privacy, Credit Reporting, and Data Security

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Use of such data is regulated under the Fair Credit Reporting Act and Regulation V on a uniform, nationwide basis, including credit reporting, prescreening, and sharing of information between affiliates and the use of credit data.

The Fair and Accurate Credit Transactions Act, which amended the Fair Credit Reporting Act, permits states to enact identity theft laws that are not inconsistent with the conduct required by the provisions of that Act.

The Fair and Accurate Credit Transactions Act, which amended the

Fair Credit Reporting Act, permits states to enact identity theft laws that are not inconsistent with the conduct required by the provisions of that Act.

Clients must be notified when unauthorized disclosure involves sensitive client information that may be misused.

On November 18, 2021, the federal banking agencies issued a new rule effective in 2022 that requires banks to notify their primary federal regulator within 36 hours of a “computer-security incident” that rises to the level of a “notification incident.”

The federal banking agencies require banks to notify their primary federal regulator within 36 hours of a “computer-security incident” that rises to the level of a “notification incident.”

The federal banking regulators regularly issue guidance regarding cybersecurity intended to enhance cyber risk management standards among financial institutions.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business