The Trump administration wants banks back in the mortgage business. Banks have other ideas.

The administration and Fed are trying to tweak capital, supervision, and CFPB rules to entice banks—especially larger ones—back into holding more mortgages and servicing rights, and to lean less on nonbank originators. Banks, though, are signaling that incremental capital relief and some tailoring of ATR/QM, HMDA, and supervisory expectations do not fundamentally change the economics, legal risk, or operational headaches that drove them out of large parts of the business post‑crisis.

The White House’s March “Promoting Access to Mortgage Credit” executive order directs CFPB, Fed, OCC, FDIC, NCUA, FHFA, HUD, VA, and USDA to consider easing rules on origination, servicing, appraisals, capital treatment, and licensing, particularly for community and “smaller” banks under roughly the $30–100B asset thresholds. Senior Fed supervision (Bowman) is explicitly tying that to concerns about nonbank mortgage lenders’ resilience and the lack of a robust resolution framework if a large servicer fails, given the shift from banks’ 60% share of originations and 95% of servicing in 2008 to about 35% and 45% today.

Industry reaction is basically: “nice, but not enough.” MBA’s Broeksmit is on record that these changes are unlikely to cause a “sea change” in who actually does mortgages, while large-bank officials (anonymously) say they won’t reenter a line they exited without much more meaningful changes to incentives and risk. In the meantime, nonbanks retain structural advantages (lighter prudential framework, lower capital, specialized ops), and banks often prefer to finance those firms rather than compete head‑to‑head in high‑volume retail origination and servicing.