With Windows 7 Product Support Ending, Article Outlines Bank Options for Upgrading

Jan. 14, 2020, is the day that Microsoft will discontinue product support for Windows 7. At that point, Microsoft will begin charging a fee for patches and related maintenance for Windows 7 users. By some estimates, just over 60% of financial institutions are either on Windows 10 or are in the process of migrating to it. A new free article on the ABA Banking Journal offers practical advice on questions to ask and options to consider as the clock ticks down.

The article notes that banks face special issues related to a software migration. Will the bank’s third-party software—such as accounting, appraisal or core applications—need to be upgraded? Is the hardware—PCs, ATMs/ITMs, and DVRs—under warranty? What do banks need to know about newer software that enables Microsoft to collect data from users?

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ABA Survey: Credit Quality Tops List of Concerns for Ag Lenders

With the farm economy in the midst of a prolonged downturn, the primary concern among ag lenders remains credit quality and the deterioration of agricultural loans, according to the latest agricultural lenders survey conducted by ABA and Farmer Mac. Respondents said they were also concerned about lender competition—particularly from the Farm Credit System, which 73.5% named as their primary competitor—as well as weakening loan demand and a shrinking market due to farm consolidation.

“Bankers are naturally concerned for their farmers and ranchers as the ag economy continues to regain its footing,” said ABA Chief Economist James Chessen. “Bankers know the cycles of agriculture very well and will continue to work side-by-side with their customers as they have done in the past. While uncertainty has risen, banks are well prepared to continue their support for the ag community through these challenging times.”

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ABA Urges Bankers to Contact Lawmakers in Support of Farm Credit Fairness Bill

With net farm income declining since 2013, and with many consumers in rural America struggling to find access to credit, ABA is asking bankers to contact their lawmakers in support of the Enhancing Credit Opportunities in Rural America Act (H.R. 1872 and S. 1641).

The bills would end taxation of interest earned from agricultural real estate loans, promoting greater access to credit for rural communities and reducing costs to borrowers. In addition, they would help bring greater parity between banks and the tax-advantaged Farm Credit System, making it easier for banks to support the farm sector through real estate loans. Bankers can visit Secure American Opportunity—ABA’s new grassroots engagement site—to contact their lawmakers. Take action now

2020 High School Scholarship Program Application Now Available

The South Dakota Bankers Foundation has allocated $90,000 for the High School Scholarship Program for 2020. Matched by recipient banks, the program will result in a total of $180,000 in high school scholarships awarded to high school seniors throughout South Dakota in 2020.

Scholarship are available in $500 increments to the first 180 banks/branches who agree to match an equal amount. Banks who participated in the High School Scholarship Capital Campaign are eligible to apply for funding. 

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NSU Master's in Banking and Financial Services Now Offered Fully Online

Northern State University’s Banking and Financial Services master’s degree program is now offered completely online, making it even more convenient for professionals looking to advance their career.

The program used to require a summer residency, but students would often have to use vacation time to come to campus, said NSU School of Business Interim Dean Dr. Doug Ohmer. If it didn’t work out, they would have to wait an entire year before they could finish the program.

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More Than 70 Attend SDBA's First Emerging Leaders Summit

Photo of Emerging Leaders Summit AttendeesMore than 70 emerging bank leaders from across the state attended the SDBA's first NEXT STEP: Emerging Leaders Summit in Sioux Falls yesterday. Attendees heard from a variety of speakers on topics such as connecting with people, the DISC universal language of observable behavior, growing the workplace culture you want and what makes a great leader. 

"It isn't about becoming the president of anything. It might not even be becoming a vice president or a director.  It is about how you are changing things that you are engaged with right now. What impact do you have? How do you influence other people, the way they think, the way they live," Avera Health President and CEO Bob Sutton told emerging bank leaders. "Leadership is about every single day modeling behaviors that other people can sincerely and genuinely appreciate."

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ABA, U.S. Chamber Foundation Announce Partnership to 'Hire Our Heroes'

The ABA yesterday announced a new partnership with the U.S. Chamber of Commerce Foundation intended to expand hiring opportunities for veterans across the nation. The partnership will enable more community banks to participate in the foundation’s Hiring Our Heroes Corporate Fellowship program, which allows transitioning service members and military spouses to intern with private sector employers for up to 12 weeks. Since the program started in 2015, 92% of fellowships have resulted in offers for permanent employment.

Through the partnership, ABA will work with Hiring Our Heroes to match interested banks with corporate fellowship opportunities in their region. At a panel discussion during the ABA Annual Convention, ABA Chair Laurie Stewart—president and CEO of Sound Community Bank in Seattle—shared her bank’s success story with the program. The bank hired Anthony Tran, a Marine Corps veteran transitioning out of the military, as a fellow, and he remains a full-time employee of the bank today.

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Registration Now Open for 2020 National Ag Bankers School

Learn Yield Grow: National School for Experienced Ag BankersRegistration is now open for the SDBA's 2020 National School for Experienced Ag Bankers set for June 22-25 at Black Hills State University in Spearfish.

The 2020 National School for Experienced Ag Bankers is a seminar for experienced ag bankers who want to further develop their ag lending skills, learn new skills, confirm existing methodology and meet fellow bankers who share the same career path. Taught by a nationally-recognized faculty of bankers, academics and other real-world ag banking practitioners, this program is focused on ag lending opportunities and challenges that are relevant to ag bankers from across the United States.

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FTC Finds Fraud-Related Losses Up Among Older Consumers

Consumers aged 60 and older lost nearly $400 million to fraud in 2018, according to a report submitted to Congress last week by the Federal Trade Commission. The report details the FTC’s efforts to protect older consumers from fraud through research, law enforcement and education.

While FTC consumer complaint data from 2018 found that consumers aged 60 and above reported fewer incidents of losing money to fraud than younger adults, the dollar losses were higher for the older group—and on the rise. The median individual loss for consumers 80 and older was $1,700—a 55% increase over the previous year. Older consumers were also more likely to report losses resulting from certain types of fraud, including tech support scams, imposter fraud, and prize or lottery scams. Most fraud against older consumers was conducted over the phone, followed by online scams. And while gift cards are becoming the payment method of choice for scammers, wire transfers hold the top spot for total dollars lost to fraud.

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House Passes ABA-Advocated AML Modernization Bill in Bipartisan Vote

The House Tuesday night voted 249-173 to pass the ABA-backed Corporate Transparency Act (H.R. 2513). The legislation, sponsored by Rep. Carolyn Maloney (D-N.Y.), would direct the Financial Crimes Enforcement Network to create a national database that banks could use to verify a business’s beneficial ownership information. The bill was amended before passage to include legislation championed by Rep. Emanuel Cleaver (D-Mo.) that would modernize the existing anti-money laundering/Bank Secrecy Act framework by, among other things, enhancing bank-law enforcement communications.

ABA President and CEO Rob Nichols welcomed the bipartisan vote as “a critical step forward . . . that will help prevent bad actors from accessing the financial system.” He added that the bill would “build on the strong cooperation between banks and law enforcement by improving information sharing while ensuring that financial institutions keep providing the most valuable and relevant information possible.”

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Bankers Nationwide Observe Get Smart About Credit Day

More than 6,000 bankers will deliver financial education lessons to nearly 156,000 teens nationwide this year as part of ABA’s Get Smart About Credit initiative, which is sponsored by Ally Financial, Citi, U.S. Bank and Wells Fargo. As the industry observes Get Smart About Credit Day today, bankers will present lessons to students on important financial obstacles facing young adults, including paying for college, knowing their credit score, managing their money and protecting their identity.

ABA staff will mark the day by partnering with staff from the Consumer Financial Protection Bureau, M&T Bank, Columbia Bank, Revere Bank and Sandy Spring Bank to volunteer at Junior Achievement’s Finance Park facility in Montgomery County, Md. During the presentation, approximately 150 seventh-grade students will hear directly from bankers about the importance of budgeting. Read more.

Blake Paulson Named OCC's Official for Midsize, Community Bank Supervision

The OCC has announced that Blake Paulson has been named the next senior deputy comptroller for midsize and community bank supervision, effective in December. He will succeed Toney Bland, who will retire from the agency in January. Paulson currently serves as deputy comptroller for the central district.

In his new role, Paulson will oversee a team of more than 1,500 employees responsible for supervising approximately 1,100 community and midsize national banks and federal savings associations that provide banking services to consumers, business and communities across the country. In addition, he will serve on the OCC’s Executive Committee and sit on various governance committees that oversee critical agency functions and help align its activity to its strategic goals and objectives.

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President Approves Third South Dakota Disaster Request

Gov. Kristi Noem announced yesterday that President Trump has approved South Dakota's request for a third Presidential Disaster Declaration, covering the damage done by severe storms, tornadoes and flooding that occurred June 30 to July 21.

The declaration will allow federal money to be used to help local government entities recover from infrastructure damage in Butte, Gregory, Kingsbury, Lawrence, Meade and Tripp counties, as well as the Cheyenne River and the Lower Brule Indian Reservations.  A preliminary assessment of the damage was estimated to be $2.5 million.

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ABA Foundation Honors Eight Banks with Community Commitment Awards

Eight banks earned the ABA Foundation’s highest honor today by being named Community Commitment Award winners for 2019. The annual awards recognize banks for their corporate social responsibility efforts in categories ranging from affordable housing to economic inclusion. This year’s winners also include a new award for banks going above and beyond to support military families. The 2019 winners will be presented with their award at the ABA’s Annual Convention in Seattle on Oct. 29. 

“Banks of all sizes are stepping up their corporate social responsibility efforts to serve their communities, and this year’s nominations in every category were incredibly impressive,” said Rob Nichols, ABA president and CEO. “The programs developed by our Community Commitment Award winners stood out to our judges and really demonstrate how banks are helping communities solve challenging issues.” 

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Agencies Finalize Rule Raising Residential Real Estate Appraisal Threshold

The financial regulatory agencies last Friday issued a final rule—which takes effect the day after publication in the Federal Register—raising the appraisal threshold for residential real estate transactions from $250,000 to $400,000. The new threshold addresses numerous concerns raised by ABA and other industry stakeholders over the time and cost of appraisals.

Under the rule, transactions that qualify for the exemption still need to obtain an evaluation consistent with safe and sound banking practices. This evaluation will provide an estimate of the market value of the property without requiring the involvement of a state licensed or certified appraiser. The final rule does not apply to loans sold to or guaranteed by the FHA, HUD, VA, Fannie Mae, or Freddie Mac—which will still require an appraisal, according to each agency’s rules.

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LEAD STRONG: Women in Banking Conference Launches Next Week

Photo of women.The SDBA will host the second annual LEAD STRONG: Women in Banking Conference on Oct. 9-10 at the Sioux Falls Convention Center in Sioux Falls. 

Attendees can connect Wednesday evening at a networking reception from 5:30 to 7 p.m. in Meetings Rooms 8-10 at the Convention Center. Thursday will begin with registration and a continental breakfast from 8 to 8:30 a.m., with the conference welcome at 8:30 a.m.

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Labor Department Releases Final Overtime Rule

The U.S. Department of Labor on Tuesday released its final overtime rule—a rewrite of the 2016 rule issued under the Obama administration that never took effect due to a federal judge’s ruling later that year. The final rule adopted many of the recommendations that ABA made in prior comment letters and that bankers advocated for during listening sessions held by DOL last fall. It will take effect Jan. 1, 2020.

As recommended by ABA, DOL set the salary level at which an employee could be exempted from federal overtime and minimum wage requirements at $684 per week, or $35,568 per year. These figures reflect the methodology adopted by the George W. Bush administration in 2004—which set the salary level at the 20th percentile of earnings of full-time salaried workers in the lowest-wage census and in the retail sector.

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In Landmark Vote, House Passes ABA-Backed SAFE Banking Act

By a bipartisan vote of 321 to 103 last night, the House passed the SAFE Banking Act, the ABA-supported bill that would provide clarity to financial institutions seeking to serve legitimate cannabis businesses. With cannabis now legal in some form in 33 states, the bill would allow banks to serve cannabis-related businesses in those states and prohibit federal regulators from taking action against a bank solely because cannabis is involved.

ABA President and CEO Rob Nichols welcomed the vote. “By helping to provide clarity for the financial sector in those states where cannabis is legal, this bill will help banks meet the needs of their communities while reducing cash-motivated crimes, increasing the efficiency of tax collections and improving the cannabis industry’s financial accountability,” Nichols said. “It will also ensure that businesses with indirect ties to the cannabis industry—including vendors, utility companies and law firms—won’t be needlessly forced out of the financial system."

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Updated Article Discusses How to Prepare for National Flood Insurance Program Lapse

With the National Flood Insurance Program set to expire at midnight on Monday, Sept. 30, unless Congress intervenes, an updated online feature from the ABA Banking Journal examines what bankers should do to prepare themselves and their customers. ABA Senior Counsel Diana Banks walks bankers through what to do before, during and after a lapse occurs.

Banks notes that before a lapse, institutions should carefully review guidance from the prudential regulators, consult with counsel to apply it to specific business areas, and encourage borrowers whose existing NFIP policies may be expiring soon to renew before the lapse occurs. When the lapse ends, bankers should verify whether the reauthorization is retroactive or not, and ensure customers understand their coverage in either case. Read the article. For more information, contact ABA's Diana Banks.

SDBA To Hold New Event for Emerging Bank Leaders

Next Step: Emerging LeadersThe SDBA has developed a new event for emerging bank leaders. Registration is now open for NEXT STEP: SDBA Emerging Leaders Summit on Nov. 5-6 at the Hilton Garden Inn Sioux Falls Downtown.

NEXT STEP: Emerging Leaders is designed to help cultivate, connect, engage and empower South Dakota’s future bank leaders. This event will encourage emerging bank leaders to find and express their voices within their organizations, communities and the banking industry and provide opportunities to network and exchange ideas with other industry professionals. It will also increase emerging bank leaders’ knowledge of topics of interest to the banking industry and promote involvement and advocacy. 

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