SDBA eNews: May 1, 2014

In This Issue

FHLB Des Moines Takes Nominations for Strong Communities Award

The Strong Communities Award demonstrates the value that communities throughout the Midwest derive from small business and economic development projects.

Federal Home Loan Bank of Des Moines has a chance for its members to honor projects that promote small business growth and demonstrate a stronger, more prosperous community.

This award, sponsored by the FHLB Des Moines Strong Communities Fund, recognizes initiatives that improve the communities around them. Learn more online or contact Mitch Fastenau, 800.544.3452, ext. 1069 if you have any questions.

The nomination process starts on May 12 and ends on June 6, 2014. 

Fed Conducting Payments Fraud Survey

The Federal Reserve Banks of Boston, Chicago, Dallas, Minneapolis, and Richmond are conducting a payments fraud survey. The survey addresses the payments-related fraud experiences of businesses and financial institutions. 

Responses to this survey will aid in the understanding of payments fraud issues for banks, as well as strategies used to cope with these issues.

The survey is open through May 9. Learn more. Take the survey.

SDBA Taxation Equality Awareness Campaign


Learn more and get involved.

Upcoming Events

View all SDBA events

Sponsorship Opportunity

Learn more about sponsoring the SDBA eNews.


Contact Alisa DeMers, SDBA, at 800. 726.7322 or via email.

SDBA Elects Three to Board of Directors

The South Dakota Bankers Association recently held elections for three of the nine seats on its Board of Directors. Elected to serve on the SDBA Board of Directors were:

  • Group IV: Steve Bumann, CFO, BankWest, Pierre

  • Group V: Shawn Rost, Northern Hills Market President/Sturgis Branch President, First Interstate Bank, Sturgis

  • Large Community Bank Category: Kevin Whitelock, President/CEO, Pioneer Bank & Trust, Spearfish

The three begin their three-year directorships today. Bumann and Rost are serving their first terms on the SDBA Board of Directors, and Whitelock is serving his second term. Read more.

Bankers Should Make Plans to Attend 2014 Annual Convention

Bankers should make plans now to attend the NDBA/SDBA 2014 Annual Convention June 8-10 at the Ramada Plaza Suites in Fargo, N.D.

One featured presenter is Emmanuel "Manny" Ohonme, who will be the Monday fellowship breakfast speaker. Ohonme, who has achieved national and international recognition as a philanthropist, businessmen and author, will present "The Power of Yes: How a Pair of Shoes Changed the Word."

Born in Nigeria, Ohonme was nine years old when his life changed: he won a basketball contest and received his first pair of shoes from a "Good Samaritan." He is proof that if you dream, and dream big, you can achieve whatever you set your mind to.

Learn more about Ohonme. Learn more about the 2014 Annual Convention.

CFPB Tweaks Mortgage Rules on QM Errors, Seeks Feedback

The Consumer Financial Protection Bureau yesterday proposed a few limited changes to its mortgage rules. One change would introduce a “cure” provision to the Qualified Mortgage rule, allowing a lender who intends to originate a QM but that later finds that points and fees exceeded the 3 percent cap to refund the excess within 120 days and maintain the legal protections afforded to QMs.

Without proposing any particular action, the CFPB requested comment on “whether and how” to provide an opportunity to cure or correct consummated loans that were originated as QMs in good faith but ended up exceeding QM’s 43 percent debt-to-income ratio limit. The bureau also requested feedback from small creditors on their experience since the rules took effect in January and “how their origination activities have changed in light of the new rules.”

ABA noted that it appreciated the bureau’s efforts to improve the mortgage rules by providing a mechanism to remedy inadvertent errors. Other proposed changes would apply to Section 501(c)(3) nonprofits that originate and service mortgages. Comments on the proposal are due 60 days after it is published in the Federal Register. Read the CFPB’s proposal.

House Passes ABA-Supported Volcker CLO Fix

The House on Tuesday passed the ABA-backed H.R. 4167 -- which would protect preexisting bank investments in collateralized loan obligations from Volcker Rule restrictions on “covered funds” -- by a voice vote. The measure, introduced by Rep. Andy Barr (R-Ky.), enjoyed broad bipartisan support.

“The interests in CLOs held by banking organizations of all sizes are no different than the direct loans banks regularly make to corporate borrowers,” ABA wrote House members before the vote. “It is not sensible to cause banks to lose value on their investments through precipitous sales unnecessary for safety and soundness reasons. This legislation would address the potential for severe disruption in the market for CLOs that were offered before the regulators issued a final Volcker rule.” Read ABA’s memo on H.R. 4167.

Senate Committee Approves Nominees, Delays Housing Markup

The Senate Banking Committee on Tuesday approved by a voice vote the nominations of Stanley Fischer as Federal Reserve vice chairman, Lael Brainard and Jerome Powell as Fed governors, Nani Coloretti as deputy secretary of housing and urban development and Mark McWatters as a National Credit Union Administration board member. The nominations now go to the full Senate for confirmation.

Chairman Tim Johnson (D-S.D.) then unexpectedly delayed the committee’s scheduled working session, known as a markup, on the Johnson-Crapo housing finance reform bill.

“There continue to be important discussions to build a larger coalition supporting the bill,” Johnson said during his opening remarks. “While we have the votes to report the bill out today, members of the committee have asked for a brief delay to try to work out additional issues prior to a final vote.”

ABA, Groups Support Clarifying Amendment to Johnson-Crapo

ABA and three other trade groups on Monday wrote in support of an amendment to clarify and limit the authority of the bill’s proposed government reinsurer, the Federal Mortgage Insurance Corporation. The amendment was introduced by Sens. Joe Manchin (D-W.Va.) and Jerry Moran (R-Kan.).

Financial institutions are worried that as drafted, Johnson-Crapo would “effectively create yet another prudential regulator with sweeping authority over the primary and secondary mortgage markets resulting in unnecessary complications for financial institutions, consumers and the broader mortgage market,” the groups said.

The Manchin-Moran amendment would provide greater clarity about the FMIC’s regulatory role and a mandate to coordinate with other regulators to eliminate duplication. “Ultimately, failure to address complexity, overlap and uncertainty could seriously curtail market participation, lending and investing, directly impacting the availability and cost of credit for millions of Americans,” the groups warned.

In related news, ABA and several trade groups separately urged the committee to adopt an amendment to Johnson-Crapo introduced by Sens. Pat Toomey (R-Pa.) and Tom Coburn (R-Okla.) that would prevent municipalities from using eminent domain to seize performing but underwater mortgages held by private-label mortgage-backed securities. "We believe these actions would severely impact the return of private capital to the mortgage markets, and would therefore undermine any chance of success of the new system," the groups explained.