SDBA eNews: August 13, 2015

In This Issue

Farmer Mac to Take Show on Road this Fall

Are you prepared for the upcoming ag lending season, one likely to differ from those in the recent past? Are your borrowers acting to reduce their financial risk? If you want to provide your borrowers options, Farmer Mac has many time-tested solutions.

Learn more at one of Farmer Mac's upcoming Road Shows this fall. Plan to attend and meet the Farmer Mac underwriting and business development team, have lunch, visit with local lenders and join the conversation.

The Road Show will be in Mitchell, S.D., on Sept. 22 and Bismarck, N.D., on Sept. 21. Learn more. Register to attend.

CFPB Releases Index to TRID Compliance Questions

To help answer bankers’ compliance questions about the TILA-RESPA integrated disclosures, which take effect on Oct. 3, the Consumer Financial Protection Bureau released an index of the questions and answers from its five TRID-related webinars. Full recordings of the webinars are also available online.

The questions cover pre-application activities, the definition of “application,” the TRID rule’s scope, record retention, variations and tolerances, redisclosures, details on the Loan Estimate and Closing Disclosure forms and the required settlement booklet. View the index.

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

Save the Date for SDBA's 2015 Bank Technology Conference

The SDBA will hold its 2015 Bank Technology Conference Sept. 22-23 at the Hilton Garden Inn Sioux Falls South.

The conference will provide information to help community banks as they continue the transition to a more technologically-sophisticated institution in this ever-changing world of mobile devices and electronic payment systems.

This conference targets the “Technology Team” in a bank. Technology managers, information security officers, IT committees, IT auditors, heads of operations, chief information officers, and anyone with responsibilities or an interest in bank technology are encouraged to attend.

Registration materials will be available in the next week. If you are planning to attend, make your room reservation by contacting the Hilton Garden Inn Sioux Falls South and request a room out of the “SDBA” block. Call by Sept. 1 to guarantee the special block rate of $134 per night.

There is an opportunity for vendors to exhibit or sponsor at the conference.

Webinar to Be Held on New Center for Indian Country Development

Federal Reserve Bank of Minneapolis invites bankers to participate in a webinar announcing the launch of its new Center for Indian Country Development (CICD) on Monday, Aug. 17, 2015, at 1 p.m. CDT.

The CICD’s mission is to help self-governing communities of American Indians in the United States attain their economic development goals. Building off the Minneapolis Fed’s 25-year history of working in Indian Country, the Center will focus on initiatives such as legal infrastructure development, improved access to capital for Native Americans, entrepreneurship and small business development, effective coordination and design of economic development programs, and related education and research.

Register for the complimentary webinar. A replay of the webinar will be available online.

On a related note, the FDIC yesterday announced steps to provide regulatory relief to financial institutions and facilitate recovery in areas supporting the Oglala Sioux Tribe of the Pine Ridge Indian Reservation -- located principally in western South Dakota -- affected by severe storms, flooding and high winds.

The agency is encouraging banks to work constructively with borrowers experiencing difficulties beyond their control because of damage caused by the severe weather. It also will consider regulatory relief from certain filing and publishing requirements. Read more.

ABA-Advocated Bills Rack Up Co-Sponsors Before Recess

Thanks to banker grassroots advocacy, bills ABA is advocating as part of its Agenda for America’s Hometown Banks are racking up bipartisan co-sponsors in Congress. As members of Congress return home for the August recess, ABA encourages bankers to set up meetings and ask their lawmakers to co-sponsor these bills -- or thank them if they already have. Among the bills are:

  • Regulatory relief (H.R. 1210 and 1233): 54 co-sponsors for H.R. 1210, 82 for H.R. 1233. H.R. 1210 has cleared the committee.
  • Mutuals and thrifts (H.R. 1660 and 1661): 10 co-sponsors for H.R. 1660, 8 for H.R. 1661.
  • Exam fairness (H.R. 1941 / S. 774): 55 co-sponsors in the House, 16 in the Senate. H.R. 1941 has cleared the committee.
  • Tailored regulation (H.R. 2896): 22 co-sponsors in the House.

Bankers can use the links above to write letters to their lawmakers. View the full list of bills and co-sponsors. View resources for advocacy during the recess.

ABA: Fiduciary Rule Would Harm Savers DoL Seeks to Protect

The Department of Labor’s controversial proposed rule redefining who counts as a fiduciary under the Employee Retirement Income Security Act covers far more services and customer interactions than is necessary, Northern Trust SVP Gerald Cleary testified on ABA's behalf before DoL yesterday.

“If adopted in its current form, the proposal will make it extremely difficult, complex and costly for banks to deliver the investment-related products, services and information necessary to achieve a financially sound retirement,” he said. “This will likely harm the very retirement investors the Department is seeking to protect.”

Central to the proposal’s problems is its overbroad definition of investment advice, Cleary said. The rule could be interpreted to cover “virtually any and every investment-related conversation with a participant, beneficiary, plan fiduciary or IRA owner,” he noted -- which would in turn stifle conversations with customers due to the strict ERISA requirements for fiduciaries.

“By promoting awkward and truncated investment discussions, the proposal is also likely to reduce customers’ trust in their retirement providers’ ability to respond to their investment needs and objectives,” he said.

Cleary, who joined dozens of other witnesses over four days of testimony, also noted that the proposal appears designed for retail investors and yet captures interactions between bank custodians and their sophisticated institutional investor customers, who do not expect their banks to act as ERISA fiduciaries. He also expressed concern about the possibility that the rule’s definition of investment advice might include periodic account statements. Read the testimony.

ABA Renews Call for TRID Transition Period

The Federal Financial Institutions Examination Council should “formally establish a transition period” in anticipation of the new TILA-RESPA integrated disclosures taking effect Oct. 3, ABA said in a letter to top financial regulators yesterday. The association asked that FFIEC issue formal guidance articulating how its agencies will examine and supervise mortgage originators in the months after TRID takes effect.

The transition period “would provide needed certainty to the credit markets and encourage lenders to continue to provide mortgage credit to qualified borrowers,” ABA said, adding that “the only way to realistically ensure an orderly transition is to confirm that supervisory standards work in tandem with lender efforts to refine and debug systems following the effective date.”

“While fine-tuning by the vendors is necessary for lenders to comply with the new rules, many lenders have yet to receive operational systems,” ABA added, noting that a transition period would accommodate the need for banks to adjust to vendor delays, changes and testing, as well as debugging systems after delivery and training staff. Read the letter.

Grassroots Push Keeps Credit Unions on Their Toes

Bankers’ grassroots comment letters to the National Credit Union Administration -- arguing against NCUA’s proposal to dramatically expand credit unions’ business lending powers contrary to congressional intent -- are keeping credit unions on their toes. A recent member communication from the National Association of Federal Credit Unions called for credit union officials to write in response to the “droves” of bankers submitting letters.

Bankers have just two weeks left to submit comment letters, which are due Aug. 31. ABA strongly urges all bankers to write NCUA explaining how its rule would affect taxpaying banks across America and the communities and business customers they serve, customizing letters to illustrate the competition their individual institutions face from tax-exempt credit unions. Take action now. For more information, contact ABA’s Brittany Dengler.