SDBA eNews: May 21, 2015

In This Issue

Deadline Extended for GSB-Wisconsin Scholarship

The deadline for the SDBA's Graduate School of Banking at the University of Wisconsin-Madison (GSB) scholarship has been extended to June 15. One South Dakota banker will be selected to receive $1,300 for each year of his or her attendance (approximately one-third of the annual tuition fees) for a total value of $3,900.  

This scholarship is for those who will be entering their first year at GSB on Aug. 2-14. A separate school application must be completed via the GSB website. Those interested in applying for the SDBA scholarship should complete the scholarship application as soon as possible.

Questions contact the SDBA's Deb Gates via email or call 605.224.1653.

Only a Few Seats Remain for GSBC School Session

The Graduate School of Banking at Colorado (GSBC) is seeing record enrollments for the 65th Annual School Session, and only a few seats remain.

GSBC recently had three spots open up for the first-year class and three spots open for the second-year direct (SYD) option. Interested candidates should apply online ASAP.

If you have any questions, call or email Josie Bunch at 303.492.6139. The 2015 school session is July 12-24 at the University of Colorado in Boulder, Colo.

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

Commander Kirk Lippold to Kick Off SDBA/NDBA Annual Convention

Still Time to Make Plans to Attend

“Real leaders aren’t just the people at the top,” says Commander Kirk Lippold. “They are the teams who take actions that produce collective success or failure.”

Join Commander Lippold Monday, June 8, during the 2015 SDBA/NDBA Annual Convention in Sioux Falls as he shares his moving story and how he guided his crew to save the USS Cole from that devastating attack in 2000.

Commander Kirk Lippold, USN (Ret.) was the commanding
officer of the USS Cole when it came under a suicide
terrorist attack by al Qaeda in the port of Aden, Yemen.
This event is widely recognized as one of the most brazen
acts of terrorism by al Qaeda prior to Sept. 11, 2001.

The 2015 SDBA/NDBA Annual Convention "Banker Boot Camp" will be held June 7-9 at the Sioux Falls Convention Center/Sheraton Hotel. This year’s event will provide an arsenal of ideas and practical ammunition to help bankers emerge as winners in the industry’s battles. Learn more and register.

GSEs Issue New Seller, Servicer Eligibility Requirements

At the direction of the Federal Housing Finance Agency, Fannie Mae and Freddie Mac yesterday announced new standards that mortgage institutions would have to meet in order to sell loans to or service loans on behalf of the housing GSEs. The new standards include net worth, capital and liquidity requirements both for depository institutions and for nonbanks.

The standards are largely unchanged from what was proposed by FHFA in January. By Dec. 15, sellers and servicers will be required to maintain a base net worth of $2.5 million plus 25 basis points of the unpaid principal balance for the total loans serviced -- although Fannie and Freddie may extend or waive the requirements at their discretion.

Depository institutions may continue to rely on their prudential regulatory standards to meet the GSEs’ new capital and liquidity requirements. Nonbanks must maintain a capital ratio -- tangible net worth divided by total assets -- of at least 6 percent. For nonbanks, minimum liquidity is 3.5 basis points of their total agency servicing, with additional liquidity for non-performing GSE servicing assets.

ABA is generally supportive of the new standards, which will help to level the playing field between banks and nonbank competitors. The GSEs also announced new operational requirements that take effect on Sept. 1. Read more and view FAQs. For more information, contact ABA’s Joe Pigg.

ABA Expresses Support for Shelby Reg Reform Bill

ABA’s officers on Tuesday expressed their support for the financial regulatory reform proposal offered by Senate Banking Committee Chairman Richard Shelby (R-Ala.). The bill, which incorporates several elements of ABA’s Agenda for America’s Hometown Banks, is set to be considered by the committee tomorrow.

“The bill is a significant, but focused step toward addressing many of the statutory and regulatory barriers that keep banks from more efficiently serving the needs of their local communities,” ABA’s officers said in a letter to Shelby. “From the smallest community banks to midsize, regional and money center banks, our members seek a regulatory environment that benefits consumers and helps the country promote economic growth in tandem with safe and sound lending.”

ABA also updated its summary of the draft reform bill to reflect minor changes made by Shelby earlier this week. Read the letter. Read the updated analysis.

Senate Democrats Unveil Competing Regulatory Relief Bill

Democratic members of the Senate Banking Committee on Tuesday released a much narrower regulatory relief bill offered as an alternative to Shelby’s more sweeping bill.

Like Shelby’s bill, the Democratic proposal would allow mortgages held in portfolio to receive the Qualified Mortgage safe harbor (but only for banks with less than $10 billion in assets), reduce the burden of unnecessary privacy notice paperwork and extend the exam cycle for more institutions. The bill excludes other ABA priorities, including provisions adjusting the thresholds for SIFI designation and stress testing requirements, providing for a short-form Call Report and establishing an examination ombudsman.

The bill would also give the Consumer Financial Protection Bureau authority to enforce the Servicemember Civil Relief Act and permanently extend provisions relating to tenants in a property being rented when it is foreclosed upon. Read a summary of the bill.

NACHA Finalizes Same-Day ACH Settlement

NACHA, the electronic payments association, on Tuesday announced that its members voted to finalize a rule change that will accelerate ACH settlement, introducing two extra windows during weekdays -- morning and afternoon -- for credit transactions. The rule provides for fees so that receiving financial institutions can recover costs associated with handling same-day ACH.

Under the current system, settlement occurs overnight in batches. The new rules will not affect existing ACH schedules and capabilities, NACHA said. The rule is part of broader industry efforts to move forward with a faster payments system, speeding up payment of invoices, payroll, bill payments and funds transfers for businesses and consumers.

ABA applauded NACHA’s final rule. “This gives users the freedom to make payments faster or to rely on the conventional overnight method,” said ABA VP Steve Kenneally. “Customers will have a real choice. It is now up to the Federal Reserve to act quickly to avoid delaying this initiative. We urge them to move forward with all due speed.”

The final rule changes the methodology used to calculate the same-day ACH fee, resulting in a 5.2 cent fee per transaction instead of 8.2 cents as originally proposed. It also shifted the morning same-day settlement window, setting a 10:30 a.m. deadline for ACH processing and a 1 p.m. settlement deadline. The afternoon processing deadline remains 3 p.m. with a 5 p.m. settlement deadline. As ABA requested in its comment letter, NACHA included an optional standardized method that originating institutions can use to identify transactions for same-day settlement.

The rule is mandatory for all financial institutions that use ACH. Same-day credit transactions will begin phasing in during September 2016, with debits following a year after. Read more. For more information, contact Kenneally.

Learn to Understand, Implement New Integrated Disclosure Rules

The SDBA if offering the two-day training session “Understanding & Implementing New Integrated Disclosure Rules” June 29-30 in Sioux Falls. 

The Consumer Financial Protection Bureau (CFPB) published a final rule to implement the new Integrated disclosures on Nov. 20, 2013, and the rule completed the Dodd-Frank mandate to combine the disclosures required by the Trust in Lending Act (TILA) and Real Estate Settlement Procedure Acts (RESPA) which go into effect Aug. 1, 2015. Coverage, timing and many other requirements have changed in TILA and RESPA requirements, and this comprehensive two-day program explains the hundreds of pages of new regs regarding the integrated disclosures.

A block of rooms has been reserved at the Hilton Garden Inn Sioux Falls Downtown. The block will be released to the general public on June 1, so the SDBA encourages bankers to reserve their rooms now. Learn more and register for the training.