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Biden Signs Executive Order to Advance Digital Assets, Explore CBDC

President Biden yesterday signed a long-awaited executive order directing government agencies to take “concrete steps” to advance the use of digital assets, including further exploration of a possible U.S. central bank digital currency, or CBDC. The order calls on the Fed to continue its ongoing work in this area, and calls for “placing urgency on research and development of a potential United States CBDC, should issuance be deemed in the national interest.”

In addition, the order directs the Treasury Department and other agencies to develop policy recommendations to address the growing digital asset sector and ensure consumer protection, directs the Financial Stability Oversight Council to identify and mitigate systemic risks related to digital assets, and calls for a whole of government approach to direct “unprecedented focus” to mitigate illicit finance and national security risks posed by illicit use of digital assets.

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Tester: Libor Fix Legislation Is in Must-Pass Spending Bill

A bipartisan, ABA-advocated bill to address “tough legacy” Libor contracts is included in the omnibus spending bill that Congress is expected to pass in the coming days, Sen. Jon Tester (D-Mont.) said at the ABA Washington Summit yesterday. “We did get it put in the omnibus bill, which means by the end of this week, by tomorrow, it should be passed,” Tester said.

In a statement, ABA President and CEO Rob Nichols welcomed the inclusion of the provision, noting that “with this action today, Congress continues to express overwhelming support for a federal solution to ensure investors, consumers and issuers of securities avoid years of uncertainty and unexpected economic losses from Libor’s cessation.”

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Sen. Moran Stresses Importance of Keeping Rural Banks Competitive

Speaking at the Washington Summit, Sen. Jerry Moran (R-Kan.) reiterated his support for the Enhancing Credit Opportunities in Rural America (ECORA) Act and other legislation intended to bolster the competitiveness of rural and agriculture-focused banks. “ECORA would provide borrowers—ranchers and farmers—with access to credit at less expensive rates,” he said.

Under ECORA, interest from loans to farmers secured by agricultural real estate would be exempt from federal income tax. ECORA also would level the playing field between banks and the tax-advantaged Farm Credit System. “It would help ensure that small community banks are competitive and have the tools to best meet the unique needs of the rural customers they serve," Moran said. ECORA remains an important issue for ABA, and the association continues to advocate for its passage.

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Sponsor, Display, Advertise at NDBA/SDBA Annual Convention

The industry’s business partners work hard to meet the needs of banks and bank customers while supporting the proud tradition of banking. Their knowledge, ideas and involvement are needed at this year’s NDBA/SDBA Annual Convention.

The 2022 NDBA/SDBA Annual Convention will be held Tuesday and Wednesday, June 14-15, at the Radisson Hotel and Belle Mehus Auditorium in Bismarck, N.D. The conference is the largest gathering of South Dakota and North Dakota bank executives you will see in 2022. More than 250 bankers and business partners are expected to register for this conference.

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SDBA to Hold Regional Meetings this Spring

The SDBA’s mission is to help educate, advocate and grow a diverse mix of financial institutions throughout the state. As part of that commitment to our members, the SDBA is coming soon to a city near you!

One outcome of the SDBA’s strategic planning session last fall was that the SDBA hit the road and re-instate regional meetings. The SDBA never shies away from a new challenge, so we will be “Takin’ it to the Streets” later this spring.

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South Dakota Bankers Foundation Re-Opens Scholarship Application Deadline

The South Dakota Bankers Foundation is excited to re-open the scholarship application deadline for member bank scholarships one final time.

If you missed out on applying for an opportunity for a $2,000 scholarship (no match required) that you may award to a student of your choice, here’s your chance. Applications will be accepted until March 18.

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SDBA Seeking Candidates for Board Elections

Elections for the SDBA’s Board of Directors are scheduled for April. Two seats are up for election: Group I and Group III.

The Group I seat is currently held by John McGrath, First PREMIER Bank, Sioux Falls, and the Group III seat is currently held by Dusty Pinske, First Interstate Bank, Rapid City. Both were appointed in 2021 to fill vacancies and are eligible to run for a full, three-year term in their respective group.

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SDSU Extension 2022 Ag Land Value Survey Now Open

Ag lenders are invited to take part in South Dakota State University Extension's 2022 South Dakota Farm Real Estate Market Survey.  SDSU Extension is requesting select groups of individuals to complete the survey including appraisers, assessors, realtors, agricultural lenders and Extension field specialists.

The principal purpose of the survey is to obtain market value and cash rental rate information, by type of agricultural land, in different regions of South Dakota. Farmers, landowners, investors, lenders, real estate professionals and public officials are the majority users of the data provided by the survey.

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ABA, Trade Groups Urge Congress to Raise Small Business Program Cap

ABA and a coalition of trade groups yesterday urged congressional leaders to increase the authorization level for the Small Business Administration’s 504 loan program. Demand is expected to reach the program’s authorization cap of $7.5 billion in early summer, likely June, the groups said. Without congressional action, the program would be unavailable to small businesses for an entire quarter of the fiscal year until the authorization level resets, they added.

The program previously reached its congressionally authorized cap on Sept. 7, 2021, and SBA was unable to approve new 504 loans until the program’s authorization level reset on Oct. 1. That three-week shutdown of the program caused a number of issues for small-business borrowers, including the loss of real estate and endangered escrow, the groups wrote. Read the letter.

FSB: Crypto Assets Could be Threat to Global Financial Stability

The crypto-asset market could reach a point where it presents a threat to global financial stability, according to a new report released yesterday by the Basel, Switzerland-based Financial Stability Board.

The fast-evolving nature of crypto assets, scale, as well as structural vulnerabilities and “increasing interconnectedness” with the traditional financial system could threaten global financial stability, the FSB warned. The international nature of crypto markets “also raise the potential for regulatory gaps, fragmentation or arbitrage,” according to the report.

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Republican Lawmakers Call for Changes to CFPB's Section 1071 Proposal

Three GOP lawmakers yesterday raised concerns about the CFPB’s pending rulemaking to implement Section 1071 of the Dodd-Frank Act. Citing concerns received from industry stakeholders, including banks of all sizes, Reps. Blaine Luetkemeyer (R-Mo.), French Hill (R-Ark.) and Roger Williams (R-Texas) flagged several issues and called on the CFPB to remedy these issues within the final rulemaking.

In particular, the lawmakers expressed concerns about the potential effects of the rule on small banks and urged the CFPB “to exclude as many small financial firms as possible” and also called for a longer implementation period, given the complexity of the rule.

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South Dakota Banking Industry Defeats Government Mandate Bill

The SDBA and its membership were successful this week in defeating a bill before the South Dakota Legislature that would have mandated how banks should operate their businesses. Senate Bill 182 titled “Prohibit discriminatory actions against persons engaged with the firearm industry” was brought by special interest groups outside South Dakota. The legislation was aimed only and squarely at banks and would have restricted a bank’s ability to do business with the state if a bank has policies regarding banking firearms customers. 

The measure would have eliminated a banking institution’s capacity to make fair business and lending decisions on financial factors. Instead, it mandated that banks who conduct business with the state are required to do business with a specific industry, regardless of considerations, including credit history or the ability to repay.

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ABA Foundation Launches 2022 Financial Education Campaigns, Unveils Free Resources for Banks

The ABA on Tuesday launched its 2022 financial education campaigns, calling on America’s banks and their more than two million employees across the nation to participate in these important and effective industry-wide efforts to promote consumer financial readiness. 

This year, the ABA Foundation will offer four specific initiatives that encourage banker volunteers to share important financial knowledge in their local communities. All of the Foundation programs are completely free to ABA member and non-member banks: 

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SDBA Holds State Legislative Day in Pierre

Photo of State Legislative DayMore than 80 bankers from across the state gathered in Pierre yesterday for the SDBA's State Legislative Day. The annual event is an opportunity to stay up-to-date on both state and federal legislation which could affect the banking industry and to make sure our industry is heard. 

Presenter Keith Prather spoke to attendees about issues affecting the economy and if 2021 is really in the rear view mirror, and Gov. Kristi Noem spoke about issues of importance being discussed at the State Capitol and took questions from bankers. The day also included special sessions for emerging bank leaders, an SDBA Legislative Committee meeting and an association update from SDBA President Karl Adam. The day culminated with a reception with state legislators and constitutional officers.

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SDBA Unveils Banks Make a Difference Survey Results

South Dakota Banks Make a Difference in Our CommunitiesSouth Dakota banks and their employees are cornerstones of their communities, providing philanthropy and volunteer leadership that helps transform lives. South Dakota banks make a difference in our communities.

The SDBA unveiled the results of its Banks Make a Difference Survey during its State Legislative Day yesterday in Pierre. Copies of the promotional handout were provided to all attendees, state legislators, and mailed to all banks and branches.

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Rep. McHenry, Sen. Tester to Speak at ABA Washington Summit

Sen. Jon Tester (D-Mont.) and Rep. Patrick McHenry (R-N.C.) have been added to the speaker lineup for ABA’s Washington Summit, a free in-person and virtual event to be held March 7-9. Tester, a key member of the Senate Banking Committee, will share his thoughts on the committee’s 2022 agenda and the critical issues facing the banking sector. McHenry, the ranking Republican on the House Financial Services Committee, will also offer his perspective on major banking policy issues and his outlook for action in the House in 2022 and beyond.

Summit attendees will hear from lawmakers and regulators, as 2022 promises to be a pivotal year for the banking industry—with new leaders now in place at major regulatory agencies, Congress eyeing the midterm elections and the nation's economic recovery still uncertain. All bankers and associate members are encouraged to attend the Washington Summit to learn about major policy issues in play and have their voices heard. Register now for this free event.

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SDBA Seeking Candidates for Vice Chair

SDBA LogoAre you interested in becoming an officer of the South Dakota Bankers Association? SDBA officers include the chair, chair-elect, vice chair and immediate past chair. The SDBA is currently seeking people who are interested in running for the vice chair position, which will be elected at the NDBA/SDBA Annual Convention on June 15, 2022, in Bismarck.

The current chair-elect, David Bangasser (Dacotah Bank, Sioux Falls), will automatically assume the chair position on June 15. The current vice chair, David Nelson (First Fidelity Bank, Burke), will be eligible to run for chair-elect. The position of vice chair will be up for election. Current Chair Kristina Schaefer (First Bank & Trust, Sioux Falls) will become immediate past chair.

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Your Support Needed: Engage in Hot Topic Banking Issues in Pierre Next Week

Photo of State CapitolIssues of importance to the banking industry are surfacing at the South Dakota Legislature, and bankers are needed in Pierre next Wednesday, Feb. 9, to make sure that our industry's voice is heard. 

All bankers are encouraged to attend the SDBA State Legislature next Wednesday at the Ramkota Hotel & Conference Center. The day-long event will include an SDBA Legislative Committee meeting, lunch, SDBA update, featured speaker Keith Prather, Gov. Kristi Noem, and the chance to visit with state legislators at the State Capitol.

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Ag Secretary Discusses Farming and Rural Economy During House Hearing

Agriculture Secretary Tom Vilsack testified last Thursday before the U.S. House Agriculture Committee on the state of the rural economy. During the four-hour meeting, Vilsack discussed a wide range of topics, including supply chain issues, employment, exports, COVID-19 relief funding, demand and price increases, underserved rural communities, the needs of specific farming sectors and the reauthorization of the farm bill, which expires next year.

“Our farm income is as good as it has been in the last eight years. We’ve had record exports,” Vilsack said at the start of his testimony. As lawmakers begin their work on the farm bill, he urged them to focus on fixing a particular issue: the rural extraction economy. It is the “heart of the challenge” that rural farmers have faced for a long time, the secretary said.

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Make Your Voice Heard at SDBA State Legislative Day

Photo of Karl Adam and Brett KoeneckeSDBA President Karl Adam and SDBA Legal Counsel Brett Koenecke met with the SDBA Legislative Committee yesterday via Zoom to discuss legislation this session that could impact the banking industry and how, with a united approach, the SDBA intends to address these bills and initiatives going forward.

As part of that united approach, bankers should attend the SDBA State Legislative Day on Feb. 9 in Pierre. This daylong event is a great opportunity to stay up-to-date on state and federal legislation that could affect the banking industry, visit with state legislators and constitutional officers, and make sure our industry is heard.

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