Legislative Webinar

Please join us for our customary webinar to review the good - and not so good - that came out of the (almost over!) 84th Texas Legislature. This popular, convenient and free program will cover some of the big issues, as well as bills passed that may impact you and your bank. We are hopeful that Karen Neeley’s white paper will be completed and ready for distribution prior to the program.

Please plan to attend this informative program on Tuesday, June 30, from 2:00-3:30 p.m. During the webinar, you will have the opportunity to send in questions. We will also have an open discussion at the end. Registration is now open. We appreciate your engagement in this important process and look forward to hearing from you.

Same-Day ACH

Last week, the National Automated Clearing House Association (NACHA) announced plans to implement same-day settlement for ACH payments by March 2018.

Under the plan, two new same-day settlement windows will be added to the ACH network, allowing for the movement of funds from once per day to three times per day. The rule requires that receiving depository financial institutions receive same-day transactions and provide faster funds availability to customers, giving end users a new option to pay bills and receive funds faster. NACHA has more information and numerous resources regarding the change available on its website.

If you’d like to hone your ACH knowledge, IBAT’s ACH Boot Camp is an intermediate-level seminar that focuses on today's rapidly changing payments environment and heightened regulatory concerns. This compliance-based offering will explore new ACH Rules, outline steps to implement these changes successfully and take an in-depth look at ACH Origination to help attendees formulate a strategy to effectively implement and grow ACH Origination service while avoiding common yet costly mistakes. Recommended attendees should have at least two years ACH experience. Register today for ACH Boot Camp on June 2-3 in Austin. 

IBAT Webinars

Did you know? IBAT, in conjunction with Financial Education, Inc., hosts close to 150 webinars a year. Webinars are a very economical way to train your staff for one low price. Everyone can sit in on the program with the use of a speakerphone and a computer, or access archived webinars on-demand.

Topics are broken up by category or by date and include:

  • Auditing & Accounting
  • Collection
  • Compliance
  • Directors
  • Frontline and New Accounts
  • Human Resources
  • IT
  • IRA
  • Lending
  • Operations
  • Security & Fraud
  • Senior Management

You can access a complete listing of upcoming webinars and archived webinars here.

Senate Bill Makes Headway

On Thursday, the Senate Banking Committee voted along party lines to approve regulatory reform legislation. As reported in last week’s Bottom Line, the bill contains many of the provisions of the IBAT-endorsed Plan for Prosperity.

During markup of the bill, the committee approved amendments to increase the threshold for CFPB examinations from $10 billion to $50 billion, as well as a measure that would bar banking regulators from participation in the “Operation Choke Point” investigation. 

The bill faces intense opposition by Senate Democrats and a likely veto threat from the White House as approved by the committee. During Thursday’s hearing, committee Democrats offered an alternative bill that focuses strictly on community bank regulatory relief. The amendment fell on a party-line vote, preserving the more sweeping reach of the legislation. 

In opening comments, Chairman Shelby and Ranking Member Sherrod Brown expressed a commitment to work together, leaving open the possibility of a compromise before the bill reaches the Senate floor.

“Chairman Shelby is a skilled negotiator,” said IBAT President and CEO Chris Williston. “We remain optimistic that he’ll work with his counterparts in the Senate throughout the summer before bringing a compromise bill forward later this year.”

Donate Today!

IBAT invites all members to join us between Memorial Day and July 4 in making a donation to Comfort Care Crew for Military Kids. Donations are used by the Comfort Crew to provide kits with age-appropriate support materials to help kids cope with challenges they may face growing up in a military family.

Since 9/11, there has been an average of at least 400 military kids a year who experience the loss of a parent in a combat-related death. In addition, more than 2,000 children of veterans are affected annually by the suicide of a parent.

Please make checks payable to the Comfort Crew and mail to IBAT by July 6. IBAT will present the checks to the Comfort Crew in mid-July on behalf of community bankers in Texas. Additional information can be found here

EGRPRA Comment

IBAT filed a comment letter on the federal bank regulator’s second EGRPRA notice. We appreciate the opportunity to identify areas of concern for community banks, particularly in regard to regulations. The purpose of the EGRPRA review is to identify outdated, unnecessary or unduly burdensome regulations and consider how to reduce regulatory burden on insured depository institutions while ensuring both their safety and soundness and the safety and soundness of the financial system. The letter addressed rules having to do with bank operations, availability of funds/collection of checks, reimbursement for providing financial records, reserve requirements, capital and CRA.

Baker Market Update: May 26, 2015

We learned [last] week that the largest automotive recall in history will rid the road of millions of government-required, defective airbags. To be fair, the government didn’t require that they be defective, just that cars are required to have them. We also learned that there will not be a recall of monetary policy. At least not in June. Minutes of April’s FOMC  meeting  clearly  reveal  that committee members are disappointed with the economy’s performance and do not possess a sufficient level of confidence to tighten policy just yet. The unbridled optimism, some might say wishful thinking, of some members, remains unsuppressed, however, and the viewpoint that our challenges will prove to be transitory and short-lived has not abated. Just a bump in the road. No exploding airbags here.

Read more in the Baker Market Update.

Day with the Commissioner

The Texas Department of Banking is continuing to support the initiative of the Conference of State Bank Supervisors and the Federal Reserve Bank of St. Louis to research community banking in America. We are holding a one day open forum event for state-chartered banks to discuss general issues affecting community banks and the current survey. Details here.

Upcoming HOTCO Meeting

The Heart of Texas Compliance Officers (HOTCO) is a newly created association for compliance officers at banks and credit unions in Travis County and surrounding areas. For HOTCO’s second of four meetings in 2015, the topic will be ‘Integrated Disclosures: Tools for Compliance ’ presented by Michael H. Patterson and Zack Boonjue of Peirson Patterson, L.L.P. 

We highly encourage all compliance officers to attend this informative meeting on May 28, 2015 at 6 p.m. at Morelia Mexican Restaurant in Pflugerville. Additional information can be found here. We hope to see you there!

Memorial Day

In observance of Memorial Day, the IBAT office will be closed starting at noon on Friday, May 22, through Monday, May 25 and will reopen for regular business hours on Tuesday, May 26.

With solidarity, the IBAT family says, "thank you," to the families of those who have been lost in current and past armed conflicts.  We are eternally grateful for the ultimate sacrifice that has been made by many for the freedom we enjoy. 

Happy Memorial Day and God Bless America!

Proper Flag Display

Displaying the state and national flags is an important duty in carrying out our mission for the people of the state of Texas.  In addition to creating an identity for the people of Texas, the proper display of flags leads the people into times of joy and mourning, and into times of reflection and celebration.

Please take note of the laws concerning Memorial Day observance:

Memorial Day:  On the morning of Monday, May 25, both the State of Texas and U.S. flags should be raised briskly to full-staff and then slowly lowered to half-staff until noon.  At noon, both the U.S. and the State of Texas flags should be raised briskly to full-staff for the remainder of the day.  Flags should be at full-staff on Tuesday, May 26.

You are not required to schedule employees for duty on holiday or weekend hours only to comply with flag-flying issues.  These requirements only apply to days that your agency normally displays the flag.

To avoid confusion, flags should be flown according to statutory standards and proper procedures of protocol.  I have attached a link to copies of the pertinent statutes.  I have also added a “best practices” section to help you distill the statutory information.

In all questions, you should consult your in-house general counsel to see how they interpret the laws to your specific situation.

IBAT Recognized

Last week, the Texas Historical Commission (THC) presented IBAT with a framed montage of photos from the First Lady’s Texas Main Street Tour to celebrate 20 years of sponsorship. Since partnering with the THC for its Texas Main Street program 20 years ago, IBAT has participated in more than 50 visits to Main Street communities as part of the tour with both Mrs. Bush and Mrs. Perry.

During the recognition, the Texas Historical Commission noted that IBAT is the perfect partner for this tour as community banks are the lifeblood of Main Street communities, supporting local activities and helping small business grow.

Photo (l. to r.) - Brad Patterson, THC Director of Community Heritage Development Division; Chris Williston, IBAT President and CEO; Mark Wolfe, THC Executive Director; Debra Drescher, Texas Main Street Program Coordinator; and Mae Beth Palone, IBAT Vice President - Legislative & Political Action Committee.

30th Annual LD Conference

IBAT's 30th Annual Leadership Conference is less than a month away. Make sure to reserve your room and take advantage of Conference registration early bird pricing by Thursday, May 21. We've told you about several educational opportunities thus far, but want to draw your attention to the mobile banking breakout session - Mobile Banking: Survey Results from 5,000 Bank App Users. In this session, SNL presents conclusions from its first-ever mobile banking survey.

In addition to mobile banking, attendees will learn which mobile payment services (Apple Pay, Starbucks, etc.) are most popular among bank app users. Data will be presented by age, income and geographic region so get ahead of the curve as we enter the next stage of online banking – mobile apps.

Card Reimbursement

Visa announced last week that as of July 1, it will adopt a tiered reimbursement system to cover the cost of reissued cards following a data breach. Visa’s new structure for data-compromise cost recovery addresses the higher operating expenses of small and medium-size financial institutions.

Reimbursements will be based on Visa purchase volume of less than $500 million, between $500 million and $10 billion, and more than $10 billion. Global Compromised Account Recovery operating expense rates for small issuers will be set at $6 per eligible account, medium issuers will receive $3.85 and large issuers will receive $2.65. Additionally, recovery amounts will increase by a dollar for all eligible accounts with chip cards.

While this is a step in the right direction, IBAT continues to advocate for national data security and breach notification standards that better protect consumers and require the party that incurs the breach to bear responsibility for all associated costs. 

Crunch Time

Thursday is a big day for community banks. It marks the first time since the unfortunate passing of Dodd-Frank in 2010 that the United States Senate has taken up any meaningful banking legislation.

Chairman Richard Shelby will lay out his 218-page Financial Regulatory Improvement Act of 2015 for full committee markup. A copy of the bill can be found here.

If you are a community banker, there is much to like about this bill. Some of the more significant regulatory relief items include the following:

  • Elimination of duplicative privacy notices to bank customers;
  • Process for applying for rural status with the CFPB for Qualified Mortgage exemption;
  • Establishes an independent examination ombudsman;
  • Qualified Mortgage status for mortgage loans held in portfolio;
  • Increases the asset threshold to $1 billion for banks to qualify for 18-month exam cycles;
  • Exemption from the Volcker Rule for banks and bank holding companies under $10 billion; and
  • Short Form Call Reporting in the first and third quarters for highly rated banks.

IBAT President and CEO Chris Williston praised the introduction of the bill in a press release issued last week. “Since the passage of the Dodd-Frank Act and throughout the rule-making process, IBAT has continuously raised concerns about regulatory burden and the associated impact on credit availability for community bank customers, especially related to mortgage loans,” Williston said. “Chairman Shelby’s draft legislation is a great step forward in addressing many of these concerns.”

The bill is expected to be highly scrutinized by Senate Democrats leery about rolling back any Dodd-Frank provisions to help Wall Street banks, although they have expressed strong sentiment for exempting community banks from some of the more onerous provisions.

State Lege Update

Last week saw the final passage of two items on IBAT's proactive state legislative agenda. SB 641 amends the prohibition on debit card surcharges at the point of sale to add penalties for non compliance. The bill also assigned enforcement of the prohibition to the Attorney General's office. Based upon our outreach to the Governor's office, we believe this will be signed into law. 

HB 2394 requires payment or posting of a payment bond prior to releasing records produced by a financial institution subsequent to a discovery request. This House bill was passed by the Senate on Friday. Additionally, SB 1020, which allows for a trust to be a named beneficiary on a POD account, will be heard in the House this week. 

More progress on our proactive agenda is expected this week as we hope to get a Senate committee hearing on HB 1936, which mandates pre-notification of a tax lien loan to existing lien holders. While the clock is ticking down on the 84th regular session, approximately ten days remain to move this bill through the Senate and on to the Governor's desk. 

Please be on the lookout for any pertinent call to action messages from IBAT in these waning days of the Texas legislative session. Your engagement has already been invaluable in this session, and we very much appreciate your involvement in this important process. 

Mark Your Calendar

Your participation is encouraged in three upcoming educational events that cover a variety of topics:

  • FDIC Money Smart for Young People and Banking on Kids 
    May 28, 2015, 2:30-3:30 p.m. 
    Hosted by the Texas Department of Banking, this free webinar will teach participants about FDIC Money Smart for Young People curriculum and Banking on Kids (an in-school, real-world banking program for K-8 students). Reserve your slot today
  • Prevent Elder Abuse and Earn CRA Credit 
    June 2, 2015, 10-11 a.m. 
    The Senior Housing Crime Prevention Foundation’s Senior Crimestoppers program protects vulnerable, low-to-moderate income senior citizens and is exclusively funded by the banking industry. Participating banks earn CRA loan, investment and service test credit. Register here for this complimentary webinar to learn about Senior Crimestoppers.
  • Day with the Commissioner 
    June 10, 2015, 10 a.m.-3 p.m.
    As part of its support of the Conference of State Bank Supervisors’ and the Federal Reserve Bank of St. Louis’ initiative to research community banking in America, the Texas Department of Banking is hosting a one-day open forum with Commissioner Cooper to discuss issues impacting community banks. Join the TX DOB in Austin.