As the coronavirus pandemic continues, scammers are exploiting consumers’ fears and uncertainties about the virus to perpetrate a range of fraud scams. ABA has published a list of common scams associated with the coronavirus, as well as 10 tips for consumers to follow to protect themselves and their finances. Bankers are welcome to use these tips freely to educate their customers. Read more.
The SDBA will hold a member COVID-19 update conference call on Friday, March 27, at 11 a.m. CDT (10 a.m. MDT).
During the call, Bret Afdahl, director of the South Dakota Division of Banking, will discuss COVID-19 public health concerns, best practices and regulatory guidance. SDBA President Curt Everson will discuss state and local government issues and federal economic stimulus legislation. There will also be time for Q&A from bankers.
In a unanimous vote late last night, the Senate passed a sweeping $2 trillion stimulus package to provide relief to American consumers and businesses struggling as a result of the coronavirus pandemic. Once approved by the House and signed into law by President Trump, this legislation—which reflects days of bipartisan negotiations by Senate leadership and the White House—will help ensure banks have additional tools to help their customers and communities, and the nation’s economy, through the crisis.
Among other things, the law will provide significant enhancements to the Small Business Administration’s lending programs, including increasing to 100% the government guarantee of loans made for the 7(a) loan program’s new Paycheck Protection Program, and waiving certain requirements for SBA Economic Injury Disaster Loans made in response to the COVID-19 emergency.
Dear SDBA Member CEOs and SDBA Board Members:
Like all of you, in recent days all of us at the SDBA have been absorbing and adjusting to COVID-19 related news and long list of changes to our daily work and personal routines which we all hope will be relatively short-lived. Rather than trying to layer individual phone calls of conference calls on top of what I know are very busy days and nights, we have tried to focus on building a robust COVID-19 resource page on our website as follows: https://www.sdba.com/covid-19. This pandemic situation is very fluid, prompting reactions and release of information by a host of public and private sources. We will strive to keep the information as fresh and content rich as possible.
In response to the coronavirus pandemic, the Small Business Administration yesterday revised its criteria for states or territories seeking an economic injury declaration. This action will create a faster, easier qualification process for states seeking SBA disaster assistance as a result of the pandemic, while expanding statewide access to SBA disaster assistance loans, which offer up to $2 million for each affected small business.
Specifically, states or territories will only be required to certify that at least five small businesses within the state or territory have suffered substantial economic injury, regardless of where those businesses are located. SBA will make disaster assistance loans available statewide following an economic injury declaration. This will apply to current and future disaster assistance declarations related to the coronavirus. Read more.
The Federal Reserve, FDIC and OCC on Tuesday issued a statement calling on banks to use their capital and liquidity buffers to help meet the needs of households and businesses as the coronavirus pandemic continues. The agencies noted that banks have “built up substantial levels of capital and liquidity in excess of regulatory buffers and minimums” in the years since the financial crisis.
“The agencies support banking organizations that choose to use their capital and liquidity buffers to lend and undertake other supportive actions in a safe and sound manner,” the statement said. “The agencies expect banking organizations to continue to manage their capital actions and liquidity risk prudently.”
As part of its policy response to the market turmoil triggered by the coronavirus pandemic, the Federal Reserve overnight announced a new Money Market Mutual Fund Liquidity Facility, or MMLF. Through the MMLF, the Federal Reserve Bank of Boston will lend to financial institutions secured by high-quality assets purchased by the the institution from MMFs. Any depository institution, U.S. bank holding company or U.S. branch or agency of a foreign bank is eligible to participate.
Eligible collateral will include Treasurys, agency securities and qualifying asset-backed or unsecured commercial paper from U.S. issuers. A term sheet specified that the banking agencies will “act to fully neutralize the impact of a depository institution holding company or depository institution’s participation in the facility for purposes of regulatory capital requirements” by fully exempting from risk-based capital and leverage requirements any assets pledged to the MMLF or purchased from an MMF starting March 18 and intended to be pledged to the MMLF.
South Dakota banks are ensuring the delivery of important financial services such as money and credit availability, while proactively working to safeguard the health and safety of their customers, staff and communities as the COVID-19 situation evolves.To help bankers address the operational challenges posed by the 2019 novel coronavirus, also known as COVID-19, the ABA will host a free webinar for its members on Thursday, March 12, at noon CDT, to provide an update on the situation and discuss business continuity planning practices for banks.
The webinar will provide an overview of the health threat and review CDC guidelines on virus transmission; help bankers assess their business continuity plans and highlight available resources to assist with planning; and review leading industry practices and lessons learned in a 2007 pandemic exercise conducted by public and private-sector participants.
Recognizing the potential effects of the 2019 coronavirus disease on bank customers, financial regulators on Monday issued a statement calling on banks to work constructively with borrowers and others affected by the virus in their communities. The agencies emphasized that “prudent efforts that are consistent with safe and sound lending practices should not be subject to examiner criticism.”
The agencies also said that to help mitigate staffing challenges banks may experience as a result of the virus, “regulators will expedite, as appropriate, any request to provide more convenient availability of services in affected communities” and “work with affected financial institutions in scheduling examinations or inspections to minimize disruption or burden.” Read the statement.
Elections for the SDBA’s Board of Directors are scheduled for April. Two directors have terms that expire on April 30, 2020, in addition to a vacancy and the election of a new sized-based category. Elections will take place in Group 1, Group IV, Mid-Size Community Bank Category and the new Community Bank Category.
Group I: The Group I seat became vacant when the director who previously held the seat, Kristina Schaefer with First Bank & Trust in Sioux Falls, was voted SDBA vice chair last year. There are two years remaining in the term for the Group I seat (through April 30, 2022). Employees of member banks located in the following counties are eligible to run for the Group I seat: Bon Homme, Clay, Davison, Hanson, Hutchinson, Jerauld, Lake, Lincoln, McCook, Miner, Minnehaha, Moody, Sanborn, Turner, Union and Yankton counties.
Acknowledging the “evolving risks” that the coronavirus outbreak poses to the U.S. economy, the Federal Open Market Committee unanimously voted yesterday to cut the target range for the federal funds rate by 50 basis points to a range of 1% to 1.25%. This is the first emergency rate cut the FOMC has made since 2008.
The committee said it would closely monitor the situation as it develops and “will use its tools and act as appropriate to support the economy” in the days ahead. In a press conference, Federal Reserve Chairman Jerome Powell emphasized that the underlying fundamentals of the economy remain strong. “Financial markets are functioning in an orderly manner,” he said, adding that “supervisors will be working with banks to ensure that they work with their borrowers” that may be struggling as a result of the outbreak.
State health officials on Feb. 27 outlined South Dakota’s steps to prepare for community spread of COVID-19 (coronavirus), as well as what South Dakotans can do now. To date, no one in South Dakota has tested positive for COVID-19.
“Since the start of this outbreak, South Dakota has taken steps to prepare for and carefully monitor for potential cases of COVID-19 in South Dakota,” said Kim Malsam-Rysdon, secretary of the South Dakota Department of Health.
The South Dakota Bankers Benefit Plan Trust, in association with Wellmark Blue Cross Blue Shield, introduced a new employer group retiree program (EGRP) providing Medicare supplement coverage to retirees. This is a program banks can offer at no cost while still providing valuable benefits to retired bank employees and their spouses.
On Jan. 1, 2020, the federal government stopped providing Medicare Plan F in the individual market. Plan F was the most popular plan for both new and existing Medicare enrollees. Now, individuals turning age 65 after Jan. 1, 2020, are no longer able to purchase this popular plan on their own. Fortunately for members of the SDBA, Plan F is now available through the EGRP from Wellmark BCBS, a trusted medical insurance provider in South Dakota for more than 75 years.
Bret Afdahl, director of the South Dakota Division of Banking, has been named to the FDIC's Advisory Committee of State Regulators. The FDIC formed the new, 15-member Advisory Committee as another mechanism for state regulators and the FDIC to discuss a variety of current and emerging issues having potential implications for the regulation and supervision of state-chartered financial institutions.
The Advisory Committee is intended to facilitate regular discussion of safety and soundness and consumer protection issues, the creation of new banks, the protection of the nation's financial system from risks such as cyber-attacks or money laundering, and other timely issues.
Registration is now open for the SDBA's 2020 Agricultural Credit Conference set for April 15-17 at the Ramkota Hotel & Conference Center in Pierre.
This conference focuses on the unique needs of ag bankers and the need for quality information and training to better serve their customers. The SDBA has lined up speakers on a variety of timely topics to help ag bankers navigate through challenging times. Experienced and new ag lenders, as well as CEOs, will all benefit from this conference.
The South Dakota Department of Agriculture (SDDA) has announced that funds are available for Specialty Crop Block Grants. Grant funds can be used for marketing, promotion, research, food safety, nutrition, distribution and best management practices to advance the specialty crop industry. Specialty crops are generally defined as fruits, nuts, vegetables, honey, and some turf and ornamental crops. A full list of specialty crops is also available on the USDA website.
“These grants give farmers a way to increase the demand for the specialty crops they are already growing,” said SDDA Grant and Loan Specialist Nicole Prince. “This year’s projects are maximizing the value of specialty crops and contributing to South Dakota’s greater agricultural economy.”
In a recent column in the Kansas Banker magazine, Sen. Jerry Moran (R-Kan.) urged support for an ABA-advocated bill that would end taxation of interest earned from agricultural real estate loans. The Enhancing Credit Opportunities for Rural America Act would not only reduce servicing costs for community banks providing these types of loans, it would also level the playing field between banks and the tax-advantaged Farm Credit System—making it easier for banks to support the farm sector through real estate loans. South Dakota's Sen. Mike Rounds is also a co-sponsor of the bill.
“The ECORA Act will promote business growth, stimulate job creation and serve as an incentive for community banks to invest in rural housing,” Moran wrote. “It will provide lower interest rates for Kansas farmers and ranchers struggling with low commodity prices. The act will also help sustain the presence of rural community banks by making them more competitive and able to meet the financing needs of their customers.” Read more.
The SDBA unveiled the latest 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 and to all state legislators.
Each January, the SDBA surveys its member banks and collects data on the importance of banks to their local communities and to the state as a whole. The annual project is just a glimpse of how banks work every day to help South Dakotans grow and prosper.
Bankers from across the state gathered in Pierre yesterday to network with each other, state legislators and constitutional officers at 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 make sure our industry is heard.
While addressing attendees, Gov. Kristi Noem asked for the banking industry's support of Senate Bill 157. Introduced by the State Affairs Committee at the Governor's request, the bill would revise certain provisions regarding the county zoning and appeals process.
