SDBA eNews: May 8, 2014

In This Issue

Export Awareness Workshop To Be Held Across South Dakota

With 95 percent of the world’s population living outside the United States, exporting is crucial for South Dakota companies to expand sales and profits.

Discover international opportunities at an upcoming Export Awareness Workshop. The series is designed to connect South Dakota companies that are new to or considering overseas sales with the resources available to begin exporting their products.

Meetings will be held in Brookings on May 28, Yankton on May 29, Sioux Falls on June 3, Watertown on June 4, and Rapid City on June 17. Learn more and register to attend.

Deadline Extended for Fed's Payments Fraud Survey

The Federal Reserve Banks of Boston, Chicago, Dallas, Minneapolis, and Richmond has extended the deadline of its payments fraud survey through May 23.

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. Learn more and take part in 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.

Community Bankers Input Sought Across SD Next Week

The South Dakota Division of Banking, South Dakota Bankers Association and Independent Community Bankers of South Dakota are holding a series of town hall meetings across South Dakota May 12-16 to gather input from community bankers. The meetings are part of an ongoing nationwide community bank project sponsored jointly by the Conference of State Banking Supervisors (CSBS) and the Federal Reserve System.

An electronic survey will be sent to banks before the roundtable meetings. Responses will be used to guide the development of legislative recommendations which CSBS, state regulators and banking trade associations can use to engage key members of Congress and to encourage their support of legislation that will improve the outlook for community banks across the country. 

The meetings will be held:

  • Aberdeen: May 12, 1 p.m. CDT, Dacotah Bank, 308 S. Main St.
  • Sioux Falls: May 14, 9 a.m. CDT, ONE AMERICAN BANK, 515 S. Minnesota Ave.
  • Mitchell: May 14, 2 p.m. CDT, CorTrust Bank NA, 100 E. Havens
  • Rapid City: May 15, 10 a.m. MDT, Dacotah Bank, 125 Main St.
  • Fort Pierre: May 16, 9 a.m. CDT, Dakota Prairie Bank, 1204 Yellowstone St.

Register to attend.

House Passes ABA-Advocated Reg Relief Measures

The House passed two ABA-advocated regulatory relief bills -- H.R. 3329 and H.R. 2672 -- by a voice vote on Tuesday.

Introduced by Rep. Blaine Luetkemeyer (R-Mo.), H.R. 3329 would raise the threshold for small bank holding company regulatory relief from $500 million to $1 billion. The bill “facilitates the ability of community banks and thrifts to issue debt and raise capital and thus increase their involvement in promoting the growth of their local economies,” ABA said, noting that it also supports raising the threshold to $5 billion.

H.R. 2672, introduced by Rep. Andy Barr (R-Ky.), would provide a mechanism for individuals and businesses in rural areas to appeal the Consumer Financial Protection Bureau’s designation of a rural or underserved area. ABA member Thomas Richards of Owingsville Banking Company, Owingsville, Ky., testified in support of H.R. 2672 before the House Financial Services Committee in December 2013.

Read more about the bills.

USDA Releases New Maps, Criteria for Rural Housing Loans

The 2014 Farm Bill made areas with populations up to 35,000 -- an increase from 25,000 -- and rural in character eligible for the U.S. Department of Agriculture’s rural home loan programs, with certain provisions.

In implementing the Farm Bill, USDA has recently redrawn and made publicly available new state maps for the purpose of determining property eligibility.

Check your area’s eligibility.

CFPB to Ease Privacy Notice Requirements

The Consumer Financial Protection Bureau on Tuesday proposed easing the annual privacy notice requirement under the Gramm-Leach-Bliley Act. Under the proposed rule, entities subject to CFPB supervision may post their privacy notices online rather than delivering them individually in certain circumstances.

“Consumers need clear information about how their personal information is being used by financial institutions,” said CFPB Director Richard Cordray. “This proposal would make it easier for consumers to find and access privacy policies, while also making it cheaper for industry to provide disclosures.”

Specifically, a bank may forgo mailing the annual GLBA disclosure if the information on it has not changed since the previous notice, if it does not share the customer’s personal information in a way that triggers GLBA opt-out rights, if it has other channels for disclosures or opt-outs required by the Fair Credit Reporting Act and if the bank uses the federal agencies’ model privacy notice form.

Instead, banks would be required to post their privacy notices online in an accessible and conspicuous way and notify customers in other required notices where to find it, that it has not changed, and that it will be promptly mailed upon request. Comments on the proposal are due 30 days after publication in the Federal Register. Read the proposed rule.

ABA, Groups Comment on Fed's Electronic Check Return Proposal

ABA and four other trade groups on Friday sent the Federal Reserve comments on its proposal to encourage banks to return checks electronically. The comments emerged from the trade associations’ working group on the proposal.

Regulation CC governs the processing and returning of checks; the Fed proposed that electronic checks and electronic returned checks exchanged by agreement be subject to the same rules unless a sending and receiving bank agree otherwise. The Fed also put forward two alternative return processing frameworks.

The working group did not support the first alternative, which involved eliminating the two-day expeditious return requirement and requiring formal notice of a return only if a paying bank returns a paper check. The group said it could slow down the check return process.

Under the second alternative -- which the group called more acceptable but did not support as drafted -- the expeditious return requirement would be retained for checks that are being returned to a receiving bank electronically, eliminating the formal notice requirement. The group proposed revising the second alternative to include a forward collection test, among other provisions. It also recommended that the Fed mandate that banks accept returned checks electronically. Read the letter.

IRS Offers Limited Relief on FACTA Implementation

In response to requests from ABA and others, the Internal Revenue Service on Friday announced that it would treat accounts opened between July and January as “preexisting” for purposes of the new account-opening procedures under the Foreign Account Tax Compliance Act. The notice provides additional relief that applies to both Chapter 4 regulations and financial institutions covered by an intergovernmental agreement.

ABA and others had expressed concerns that the release dates of the necessary forms and instructions will not allow sufficient time to comply. The IRS thus said it will “allow a withholding agent or [foreign financial institution] to treat an obligation held by an entity that is issued, opened, or executed on or after July 1, 2014, and before January 1, 2015, as a preexisting obligation for purposes of implementing the applicable due diligence, withholding, and reporting requirements.”

The IRS also said it will consider the remainder of 2014 and 2015 as a transition period for FATCA, taking into account “good faith efforts” by institutions to comply with the law after the July 1 effective date. “An entity that has not made good faith efforts to comply with the new requirements will not be given any relief from IRS enforcement during the transition period,” the agency said.

ABA will hold a 90-minute briefing and webcast on May 20 to educate bankers about their responsibilities under FATCA, clarify matters of continuing confusion and highlight compliance challenges. IRS personnel will join experienced tax professionals on the webcast.