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Policy actions taken during the pandemic led to "the most equitable" recovery in recent history, a new government report found, YahooFinance.com reported. The study released yesterday by the Treasury Department found that the president’s American Rescue Plan Act (ARPA), along with actions taken by state and local governments, prevented the worst economic outcomes for Black and Hispanic families during the COVID pandemic, groups that were the hardest hit during that time and have historically been more vulnerable to downturns. The federal aid — including stimulus checks, rental assistance, and the expanded child tax credit — in combination with local support and the Federal Reserve efforts helped sustain Black and Hispanic household finances, narrow the wealth gap, and improve some economic indicators relative to the pre-pandemic period. Read more.

Click here to access the full Treasury Department report.

Texas Capital Bank said it was convinced by the U.S. government to loan $28 million in December to help a bankrupt reverse-mortgage company fund payments to elderly homeowners and avert a crisis in the reverse-mortgage industry, WSJ Pro Bankruptcy reported. But the Dallas lender was left empty-handed after the government said it extinguished the bank’s collateral rights, according to a lawsuit filed Wednesday against the Government National Mortgage Association, known as Ginnie Mae, and its parent agency, the Department of Housing and Urban Development. Texas Capital Bank said that it was induced by Ginnie Mae to extend a bankruptcy loan to Reverse Mortgage Investment Trust, one of the largest lenders participating in the government-backed reverse-mortgage program. HUD and Ginnie Mae declined to comment, citing pending litigation. Starwood Capital Group-backed RMIT filed for chapter 11 in November with the U.S. Bankruptcy Court in Wilmington, Del., facing a liquidity crunch because of rising interest rates. After the bankruptcy filing, RMIT failed to fund payments to thousands of elderly homeowners, according to the bank’s complaint. Ginnie Mae allegedly told Texas Capital Bank that its loan was needed to fund those draws while avoiding a catastrophic disruption to the reverse-mortgage program, the bank said in its lawsuit, filed in the U.S. District Court in Amarillo, Texas.

Federal housing authorities persuaded Texas Capital Bancshares Inc. to help with the fallout from a bankrupt reverse-mortgage provider, then went back on their promises of financial support, the company said in a lawsuit Wednesday, Bloomberg News reported. The Government National Mortgage Association, known as Ginnie Mae, canceled liens on tens of millions of dollars in collateral after the bank agreed to make a loan to Reverse Mortgage Funding LLC, according to the lawsuit. The loan was intended to prop up customers of the failed company, which was one of the largest providers of government-backed reverse mortgages. The firm’s Texas Capital Bank unit provided the funds “on an emergency basis, in an effort to protect thousands of senior citizen mortgagors,” the bank said in the complaint. “Just weeks later, Ginnie Mae reversed course and purported to leave TCB empty-handed.” The controversy traces its roots to last year’s bankruptcy of Reverse Mortgage Funding. Like many in the industry, the firm had been squeezed by surging interest rates and regulatory pressures. Texas Capital claims in the lawsuit that Ginnie Mae persuaded it to provide debtor-in-possession financing after the failure of Reverse Mortgage Funding.