SDBA eNews: September 4, 2014

In This Issue

New SBS Compliance Risk Product Pilot Program

Banks are continually feeling the pressure from regulators to develop a better compliance risk program.  

Secure Banking Solutions has created a new TRAC Module to help automate the process of compliance risk assessment to help relieve some of this pressure.  

Join SBS for a 30-minute webinar demo on Sept. 12 of its new product and sign up to be a pilot bank and be eligible for a 30 percent discount off the regular price when it is launched.

Learn more and register.

UDAAP in Marketing Webinar: Sept. 18

Compliance Alliance, the SDBA’s newest endorsed vendor, is offering a complimentary webinar “UDAAP in Marketing” on Sept. 18, 2:30-3:30 p.m. CDT.

This training will cover how unfair, deceptive and abusive acts and practices apply in the marketing area.  This webinar is intended to prepare banks for regulatory scrutiny of the bank’s marketing programs and materials. The training will include a look at recent enforcement actions and why UDAAP is a powerful weapon in the arsenal of the regulatory agencies.

Learn more and register.

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.

Learn How to Jump Ahead
of the Technological Rush

Technology is supposed to make life faster and easier. So why does it always feel like the bank is behind the curve when it comes to the world of technology? Whether it’s intranets, marketing systems, social networking media or smart phone applications, technological innovations seem to move at the speed of light, while your customers and employees continue to demand more in the quest to keep pace.

During his keynote address at the SDBA's 2014 Bank Technology Conference, Jackson Hataway Ph.D. will use state-of-the-art examples to give participants the key to jumping ahead of the technological rush. Participants will learn about some of the hottest technological trends in the financial industry and will find out how technology can connect them to a generation of members everyone says is out of reach.

This year's conference will be held Sept. 23-24 at the Clubhouse Hotel & Suites in Sioux Falls. See the full conference agenda and register.

CFPB Cautions Card Issuers on Promotional APR Disclosures

The Consumer Financial Protection Bureau yesterday warned credit card issuers to avoid potentially deceptive practices in how they market promotional interest-rate offers. The bureau specifically referenced offers of promotional APRs on particular transactions or products.

“CFPB supervisory experience has observed that some card issuers do not adequately convey in their marketing materials that a consumer who accepts such a promotional offer will lose his grace period on new purchases if he does not pay the entire statement balance, including the total amount subject to the promotional APR, by the payment due date,” the bureau said.

“Providing clear and transparent disclosures so customers are fully informed is one of our industry’s top priorities,” ABA SVP Nessa Feddis commented. “As the CFPB points out, federal regulations require -- and banks ensure -- that consumers receive four highlighted notices indicating they will lose the grace period on new purchases if they don’t pay their balance in full.” Read the bulletin.

Keating: Corporate Inversions Resemble CU Tax Exemption

Corporate tax inversions like Burger King’s and Medtronic’s -- in which U.S. companies incorporate offshore to avoid some U.S. taxes -- are much in the news and attracting policymakers’ attention. So why, ABA President and CEO Frank Keating asked in an American Banker op-ed on Tuesday, have policymakers paid so little attention to credit unions, “an entire industry that has been quietly -- and legally -- avoiding taxes for eight decades?”

“In fact, credit unions' tax loophole costs taxpayers as much as inversions do: $2 billion per year,” Keating wrote. “If inversions are controversial, so too should be the subversion of the historic basis for credit union tax exemptions.”

The brouhaha over inversions highlights the need for comprehensive, pro-competitive corporate tax reform, he argued -- which should close loopholes for credit unions. “Companies should be free to grow their businesses on their own terms, and they should then pay straightforward taxes on their profits,” he said. Read the op-ed.

Change in FHLB Membership
Criteria Proposed

The Federal Housing Finance Agency on Tuesdy proposed several significant changes to eligibility for membership in the Federal Home Loan Bank system. In a new quantitative test that the agency said reflects its statutory mandate, members would be required to hold 1 percent of assets in home mortgage loans. They would also be required to have at least 10 percent of assets in residential mortgage loans on an ongoing basis, not just upon application for membership.

The FHLBs would be required to ensure member compliance with these requirements each year, calculating the relevant ratios based on a three-year rolling average. FHLB members not meeting these requirements would be given one year to return to compliance. The FHFA proposed to expand the list of assets that qualify as “home mortgage loans” for the 1 percent test to include securities fully backed by first mortgages on single- or multifamily properties and by other securities backed by these loans.

The rule would also revise insurance company membership eligibility to exclude captive insurers. In 2011, ABA opposed a similar advance notice of rulemaking on FHLB membership, noting that eligibility should be defined by statute and that the measures envisioned would add unnecessarily to compliance costs.

ABA will review the proposed rule in detail with its Federal Home Loan Bank Committee in the coming weeks and will file comments on the proposal.

Bankers Urged to Volunteer for Fall Financial Education

ABA is inviting bankers to sign up for its fall financial education programs, which start in October.

Get Smart About Credit is a volunteer banker-led program that delivers relevant lessons to teens and young adults about using credit wisely and paying for college. Lights, Camera, Save! is a local bank-hosted video contest for teenagers.

“Our financial education programs give bankers the framework and tools to engage students of all ages,” said ABA President and CEO Frank Keating. “Through these programs, bankers have challenged more than seven million young minds across the nation to think critically about their financial goals and expectations.” Register now to volunteer.

Farmer Mac Road Show
Coming to Sioux Falls Sept. 10

Farmer Mac’s popular Road Show will be in Sioux Falls on Sept. 10. Meet the Farmer Mac underwriting and business development teams, have lunch, visit with other local lenders and join the conversation.

This is a special opportunity to learn firsthand about the benefits of the secondary market for farm real estate loans. Topics will include a discussion of the ag economy, underwriting tips, peer analysis for your farm customer, the lender’s role in ensuring timely appraisals, interest rates updates, lender testimonials and marketing ideas to grow your portfolio.

Last year more than 500 community bankers participated in Farmer Mac's Road Shows. Workshops are complimentary, but space is limited.  See all locations and register.