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Jeffrey P. Naimon quoted in American Banker article, “Whose American dream?”

American Banker

Jeffrey P. Naimon

The American Banker article, “Whose American dream?” examined the barriers to home ownership and the challenges faced by banks in making loans. The article noted how, following the financial crisis, regulators revised how they evaluated banks’ capital adequacy, and the Fed’s stress testing regime had a bearing on the types of loans banks held on their books. “Residential mortgages — previously thought to be risk-free — faced dramatic loan losses in the stress tests, especially for riskier loans. The result is fewer institutions willing to offer riskier mortgage lending products.” Naimon noted, “If we tell banks that we want them to do well in a crisis and that we are protecting the public against another bank failure by performing stress tests, that’s a reason why banks don’t make loans to certain borrowers.”

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