SDBA and WBA Offering Course: Virtual Understanding Bank Performance

If there's one thing we've seen clearly in the fallout from Silicon Valley Bank and Signature Bank, it's that today's bankers need to have a deep understanding of how bank performance actually works. Washington Bankers Association’s Understanding Bank Performance curriculum, taught by a graduate of Pacific Coast Banking School, is designed to provide just that, in an engaging, relevant, and comprehensive fashion. This opportunity is being offered virtually in July in conjunction with the SDBA.

Participants will learn how to assess and analyze a bank’s financial performance by working with data from real institutions. Using financial statements from one sample financial institution along with statements from their own banks, participants will become familiar with the ins and outs of balance sheets and income statements and learn how to apply key performance metrics to the data presented in these documents.

To view more details and to register, click here.

Register for the 2023 SDBA Ag Credit Conference

The South Dakota Bankers Association will present the 2023 Agricultural Credit Conference on July 19-20 in Pierre, S.D. This conference focuses on the unique needs of ag bankers and the desire for quality information and training to better serve their customers. Attendees will benefit from a day and a half of presentations from nationally recognized speakers, network with more than 125 banking peers and meet several exhibitors who offer products and services geared toward ag banking. New or experienced ag lenders, as well as CEOs, will all benefit from this conference.

For more information or to register, click here.

Registration Open for the 2023 SDBA Digital Innovations in Today's Banking Environment Conference

The SDBA Digital Innovations in Today’s Banking Environment Conference (formerly Technology Conference) will be held on August 29-30 at the Hilton Garden Inn Sioux Falls South in Sioux Falls.

This conference is designed to provide support as you keep on top of technology trends, navigate the business of banking, and build and sustain your bank’s technology strategy—all to improve access and better serve your customers. The Digital Innovations in Today’s Banking Environment Conference will provide you with an opportunity to learn from industry experts, network with colleagues, and visit with exhibitors to see and experience the latest in products and services.

There is an opportunity for business partners to exhibit at and sponsor the conference. For more information and to register, click here.

SDBA Fraud Peer Group Established

With all the recent fraudulent activity, the SDBA has been asked to establish a peer group of fraud-related personnel to share ideas, exchange thoughts, and network. There is no cost to participate in this group. This will initially be email-based, and, if the desire exists, potentially expand to Zoom/virtual or in-person, when allowed. If you would be interested in connecting, please email [email protected]. You will receive additional information once the group is established.

ABA Strongly Opposes Re-Introduced Credit Card Legislation

By Rob Nichols, ABA President and CEO

“We strongly oppose the damaging credit card legislation led today by Sen. Dick Durbin (D-IL), Sen. Roger Marshall (R-KS), Sen. J.D. Vance (R-OH), Sen. Peter Welch (D-VT), Rep. Lance Gooden (R-TX), Rep. Zoe Lofgren (D-CA), Rep. Jeff Van Drew (R-NJ), and Rep Tom Tiffany (R-WI). This is a regressive bill that takes from consumers, community financial institutions and small businesses and gives to the most profitable global retailers and biggest grocery chains. It’s particularly surprising to see Reps. Lofgren, Van Drew, and Tiffany partnering with Rep. Gooden to champion the top legislative priority of growing grocery conglomerates, rather than standing up for food shoppers. Likewise, it’s hard to understand why Sen. Vance is working with Sens. Durbin, Marshall and Welch to promote the profits of big box department stores and dominant online retailers in their plan to take away Ohioans’ credit card rewards. We’ve seen this movie before: the original Durbin Amendment eliminated debit card rewards, raised banking fees, and increased fraud costs all without lowering costs for consumers. At this time of high prices and security risks, America’s banks are focused on protecting consumers and we will vigorously oppose this misguided legislation.”

View article here.

ABA Report: Bank Economists Expect Credit Conditions to Soften in the Second Half of the Year

Bank economists expect credit conditions to soften over the remainder of the year due to the economic headwinds faced by consumers and businesses, according to the American Bankers Association’s latest Credit Conditions Index released today.

Credit Conditions Index historical graph

The latest summary of ABA’s Credit Conditions Index examines a suite of indices derived from the quarterly outlook for credit markets produced by ABA’s Economic Advisory Committee (EAC). The EAC includes chief economists from North America’s largest banks. Readings above 50 indicate that, on net, bank economists expect business and household credit conditions to improve, while readings below 50 indicate an expected deterioration.

According to the Q3 2023 report, most EAC economists continue to believe that credit quality and availability will weaken over the next six months, and no member of the Committee expects either metric to improve this year. While credit quality and availability have been remarkably resilient since the onset of the pandemic, recent index readings foretell softening credit conditions for both consumers and businesses. In response, EAC members expect that lenders will grow more cautious, particularly given elevated interest rates.

“ABA’s latest Credit Conditions Index anticipates that lenders are preparing for weakening economic growth and increasing financial challenges for consumers and businesses as the year progresses,” said ABA Chief Economist Sayee Srinivasan. “At the same time, bank economists expect inflation to continue to ease, reducing the need for additional Fed rate hikes, and that underlying strength in the labor market will provide a buffer for consumers and businesses.”

In the third quarter:

The Headline Credit Index improved slightly in Q3 to 7.3, increasing 1.5 points, while remaining near a post-pandemic low. The sub-50 reading indicates consensus among bank economists that credit market conditions will weaken. As a result, banks are expected to exercise caution when extending credit to both businesses and consumers over the remainder of the year.
The Consumer Credit Index improved 2.6 points to 8.3 in Q3. No EAC members expect consumer credit availability or quality to improve in the next six months and most expect both to worsen. The sub-50 reading indicates that credit conditions for consumers are likely to weaken over the next two quarters.
The Business Credit Index improved marginally by 0.5 point in Q3 and now stands at 6.3. As a group, EAC members are slightly more pessimistic regarding business credit availability than quality, though both metrics are expected to worsen. The sub-50 reading indicates that credit conditions for businesses are likely to weaken over the next two quarters.

Read the full report with detailed charts and a discussion of the broader economic context.

CISA News: The FBI Could Help Retrieve Your Data After a Ransomware Attack

This article gives organizations guidance on what you should and should not do if your organization falls victim to a ransomware attack. Spoiler alert, the best message is do not pay the ransom!

QUESTION OF THE WEEK

Q: For the bank’s Privacy Notice, is the bank’s holding company considered an affiliate?

A: Reg P defines an affiliate as follows:

"(1) Affiliate means any company that controls, is controlled by, or is under common control with another company." https://www.consumerfinance.gov/rules-policy/regulations/1016/3/#a-1

Since the holding company has "control," they are an affiliate. This said, you'd only need to list the affiliate (including holding companies) with whom you're sharing information. If you do not share information with the holding company, then they do not need to be listed, but if you are sharing with them then they should be listed on your privacy notice.

Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call (888) 353-3933 or email [email protected] and ask for our Membership Team.

For timely compliance updates, subscribe to Bankers Alliance’s email newsletters.