Congresswoman Expresses Concerns About ICE-Black Knight Merger
By KIMBERLEY HAAS
As officials at the Federal Trade Commission continue to review the proposed acquisition of Black Knight by Intercontinental Exchange, the top Democrat on the House Financial Services Committee is reiterating her concerns about the merger.
U.S. Rep. Maxine Waters (D-CA) has said the two companies play a dominant role in the technology and data underlying the country’s mortgage markets and “such a monopoly would harm our nation’s consumers and our housing market.”
This week, Waters sent a letter to FTC Chair Lina Khan offering recommendations for a negotiated settlement agreement, saying there are anti-trust, financial stability, and consumer protection safeguard issues to be considered.
“In addition to potentially creating a housing finance conglomerate that would dwarf all other players in the industry, I remain concerned that this merger has the potential to harm consumers by displacing competing products and businesses that help mitigate rising loan origination and servicing costs, thereby pushing the dream of homeownership further out of reach for families across the country,” Waters wrote.
Waters said even with planned divestitures, there is no doubt that the combined technology services business of ICE and Black Knight will affect the pricing of mortgage loans and mortgage servicing rights in profound ways.
As part of the deal, ICE has agreed to sell Black Knight’s Empower and Optimal Blue businesses.
Earlier this month, leaders at the Community Home Lenders of America sent a letter to Khan saying if the deal is approved costs for smaller lenders could go up.
They explained that Independent Mortgage Banks originate over two-thirds of all mortgage loans and more than 90% of FHA loans but a large majority of them are not capable of developing their own Loan Origination Software, the infrastructure essential to executing mortgage loan originations, leaving them vulnerable to providers.
Executive Director Scott Olson told The Mortgage Note on Wednesday they share the same concerns as Waters about the consolidation of ICE and Black Knight.
CHLA leaders want mechanisms put in place to monitor ICE’s actions going forward and are calling for an end to what they describe as anti-competitive practices.
The deal is expected to close on Sept. 5.
How To Increase Homeownership Rates For Millennials
Bonzo Leader Says Success Starts With Personalized Messaging