Banking News

AmBA Pushes Back on White House Claims about Reg Burden August 11, 2016

AmBA firmly pushed back against a report from the President’s Council of Economic Advisers claiming that the Dodd-Frank Act and other regulations has had little to no effect on community bank consolidation. “[C]ommunity banks have remained strong as Dodd-Frank reforms have been implemented,” the report found.

“There is a serious disconnect between this report and the daily reality for America’s hometown banks and the communities they serve,” said AmBA President and CEO Rob Nichols. “The 1,708 community banks that have disappeared since July 2010 would be best equipped to speak on this topic -- except they can’t.”

The White House report stated that “[m]any community banks -- particularly those with assets between $100 [million] and $10 [billion] -- have continued to grow steadily, as evidenced by their substantial lending growth, increasing market share in agricultural and mortgage lending, and expansion into new counties.” It also stated that “macroeconomic factors” are the principal contributor to reduced de novo activity and community bank growth.

Nichols noted that the cumulative regulatory burden imposed by Dodd-Frank and other laws has left an indelible effect. “The more than 24,000 pages of proposed and final rules bely the idea that Dodd-Frank had no impact,” he said, adding that “the rules intended for the largest banks are now considered ‘best practices’ for all banks, compounding the misery for smaller banks. Arbitrary size thresholds are stopping community banks from growing because of the added regulation, thus limiting the services they could provide.”

While defending the implementation of the Dodd-Frank Act to date, the White House report echoed a message ABA has consistently delivered: the importance of “continuing to tailor regulatory requirements to reflect the different needs of community banks and the lower level of financial risk that they pose.” Nichols reiterated calls for “long overdue” comprehensive regulatory relief. “Each day another community bank leaves the field, it makes that community -- and our economy -- poorer.”

Click here to read the White House Report. Click here to read Nichols' Statement.

Bankers Urged to Write in Support of Durbin Repeal Bill August 9, 2016

AmBA is calling on bankers to write to their lawmakers in support of H.R. 5465, a bill that would repeal the so-called “Durbin Amendment” and eliminate the government-imposed price controls on debit card interchange. The association is asking bankers to send their letters by the end of the day tomorrow.

To help bankers craft their messages, AmBA has prepared a one-page summary on the amendment and the proposed legislation. The summary is part of AmBA’s free, online packet of resources bankers can use when engaging with their lawmakers during the August recess. The packet includes talking points and issue backgrounders on several priority issues, including tailored regulation, charter flexibility, the Department of Labor’s final overtime rule, Federal Reserve capital and other issues that affect bankers’ ability to do business. Click here to view the Durbin summary. Click here to view the recess packet.

Agencies Propose Simplified Call Report for Smaller Banks August 8, 2016

Along lines long urged by AmBA, the federal banking agencies on Friday proposed a new, shorter Call Report with simplified instructions for banks with less than $1 billion in assets and no foreign offices. The new Call Report form would be reduced from 85 pages to 61 as a result of removing 950 data items, or about 40 percent of entries on the current Call Report.

The revised Call Report would also streamline how banks report on their complex activities, with existing schedules on complex or specialized activities -- such as derivatives, trading or credit card lending -- being replaced with simple questions that ask whether banks engage in the activities and indicate specific data items to fill out if they do. Some schedules would also be filed on an annual or semiannual basis.

The proposal comes after AmBA helped over the past several years to facilitate conference calls with community bankers and regulators to explain current Call Report burdens and offer suggestions for streamlining it. AmBA anticipates future proposals related to Call Report reform in the future. If adopted, the new Call Report would take effect with the March 31, 2017, report date. Comments on the proposal are due 60 days after it is published in the Federal Register. Click here to read the proposal.

Wells Fargo: Millennials Remain Optimistic about Finances August 8, 2016

Millennials remain generally optimistic about their finances, with most believing they will do the same or better than their parents and 55 percent considering themselves in a successful financial position; 94 percent consider themselves “financial adults.” The findings, included in a Wells Fargo/GfK survey released last week, echo previous findings in Wells Fargo surveys.

However, the report did find indicators of financial stress among those aged 22 to 35, with just under half saying they live paycheck-to-paycheck. Student loan debt continues to drive financial worries; 48 percent of millennials carry some student debt, with a median debt burden of $20,000, and of those, 71 three-quarters say their debt is “unmanageable.” They report difficulty saving, with 38 percent of millennials building an emergency fund is a high priority and only 13 percent saying they’ve achieved it.

Paying down debt remains a top goal for millennials when they get extra money. If given a raise, 32 percent said they will pay back consumer debt and 21 percent said they would put it toward student loan debt. Meanwhile, 27 percent said they would save more for retirement and 16 percent said they would put it into short-term savings. Click here to read more.

State Associations Call on Senators to Support TAILOR Act August 3, 2016

All 52 state associations wrote to senators yesterday urging them to co-sponsor the TAILOR Act, which would direct financial regulators to tailor regulatory actions based on the sizes, business models, risk profiles and other differentiating characteristics of the institutions they supervise.

Introduced by Sen. Mike Rounds (R-S.D.), S. 3153 has been jointly advocated by AmBA and the state associations. The House version cleared the House Financial Services Committee in March and is waiting for a floor vote.

“Financial institutions, particularly community banks, have been besieged by an avalanche of regulations coming out of the financial crisis,” the associations wrote. “While many of those new rules address legitimate concerns, they are often applied in indiscriminate fashion, imposing substantial burdens on institutions whose risk profiles and business models clearly do not warrant such applications. In the end, the primary losers… are the people and communities served by our nation’s banks.” Click here to read the letter.

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FS-ISAC Security Update

FS-ISAC Security Information Available to ABA Members

ABA members can now access FSā€ISAC security threat information via the FS-ISAC Weekly Risk Summary Report, designed for community institutions to deliver timely and actionable information on significant security threats.

Click here to access the most recent Weekly Risk Summary Report.