Flags at Half Staff

Pursuant to Texas Government Code Chapter 3100 and 36 USC 10, and acting in my capacity as the Governor of the State of Texas, I hereby direct the immediate lowering of all flags under state control to half-staff in honor of those involved in the recent shooting at Fort Hood, Killeen, Texas.

Please notify personnel within your agency and other state agency and university leaders of this directive. Flags of the United States and the State of Texas should remain at half-staff from this date through sunset or the end of the flag display day on Friday, April 4, 2014. Flags should be flown at half-staff for the same length of time at all State of Texas offices and facilities in other states and abroad.

Individuals, businesses, municipalities, counties and other political subdivisions are encouraged to fly their flags at half-staff for the same length of time as a sign of respect.

Anita and I send our deepest condolences and prayers to the soldiers, families and support personnel touched by this terrible event.



PAC Drive Update

With March in the books, IBAT thanks all member banks and their employees who participated in our PAC Drive efforts throughout the month. Remember that, even if you weren't able to partake in the month of March, your bank can still participate by holding a PAC drive throughout the year.  

The IBAT Leadership Division has challenged all IBAT member banks to raise at least $1,000 for the IBAT Fed PAC to help strengthen the voice of community bankers in Washington.  

Additionally, IBAT's Associate Member Advisory Council is challenging member companies to hold employee PAC drives during the month of May. At IBAT's Board meetings last week, the employees of First American Payment Systems presented IBAT Executive Vice President Steve Scurlock with a check for $7,012.50 raised by First American employees over the past month.  Our sincere thanks and gratitude to the First American employees.

PHOTO: First American Payment Systems' Rick Rizenbergs, Shawn Dillon, Cody Yanchak and Billy Bourne with IBAT's Chris Williston and Steve Scurlock.

2014 Leadership Conference

Since last year's Leadership Conference with Duck Dynasty's Jase Robertson, IBAT members have been asking, "what are you going to do to top that?"

While we can't promise another Jase, we're eager to roll out our full lineup of speakers for the 2014 Leadership Division Conference, June 26-28 at the JW Marriott San Antonio Hill Country.  Later this week, all IBAT members will receive an email with conference details and a registration link for another great event.

As always, you can count on the IBAT Leadership Conference being an opportunity for you to learn from industry leaders and from your peers as you tackle the challenges facing community banks in a post Dodd-Frank world. And, of course, it will be a family-friendly event with fun for everyone. We look forward to seeing you in June!

HMDA Data Requests

Several banks have contacted us regarding recent requests for HMDA data from Bank of America (B of A). IBAT contacted B of A to determine why these requests were being made, and to solicit additional information.  

In short, it is apparently common practice for the large banks to ask for this information from one another prior to publication of industry-wide data in October of each year, to compare their lending practices with one another in various markets. For the first time, B of A is broadening their scope to include community banks in various markets, presumably those with substantial market share. This is being driven by those responsible for fair lending analysis, and we were assured that the information gathered is kept for internal analysis purposes only.

Our Legal/Compliance team has developed a brief summary to guide you in the event you receive a request for HMDA data from whatever source.  Additionally, please feel free to contact us if you need additional information.  

Happy Anniversary, Chris!

A moment of personal privilege from the IBAT staff today as we pause to celebrate our boss, IBAT President and CEO Chris Williston.  Today, April 1, marks Chris's 25th anniversary with IBAT.

We are all very thankful for the opportunity to work on behalf of Texas community banks, and working for Chris makes it all the better.  

Thanks, Chris, for bringing us all together for a great cause!

Data Breach Update

The House Business and Industry Committee met last week to hear testimony regarding data breaches and what might be done at the state level to address the security of sensitive customer information. IBAT’s Karen Neeley was among those appearing before the committee as part of a financial services panel.  Also appearing were representatives from the retailer’s and restaurant associations, MasterCard and VISA, a security consultant and the CEO of Heartland.

The hearing was informational in nature, and while a number of recommendations were made from the various parties, there was little agreement as to next steps.  IBAT has been actively engaged in this issue over the past five legislative sessions and is in discussions with various parties in preparation for the next legislative session.  We believe it is wrong for banks to pay for fraud losses and card re-issue due to breaches and will continue to work to bring some reason to this process.

We appreciate the response to our recent survey, and the results were helpful in making our case that this is indeed a costly and serious issue. After adjusting for incomplete and duplicative responses, we had good data from 92 Texas chartered banks regarding their losses and costs over a 120 day period covering the recent “headline” security breaches.  Based upon those responses, and extrapolating based upon the assets of all Texas charters, we estimated a cumulative impact of $15.8 million.  

IBAT will continue to press forward with all parties at both the state and federal level on this important issue.  

Baker Market Update: Mar. 31, 2014

Finally, all the widgets have been counted. The initial good news of 3.2% Q4 GDP that was then revised to the less-than-good-news of 2.4% has been re-revised to the little-bit-better-news of 2.6%; slightly below the little-bit-better-than-that expectation of 2.7%. Regardless of which number suits you, the Bureau of Economic Analysis proclaimed, on Thursday, that 2013 is over. As surprising as that revelation may have been to some, it was nothing compared to the proclamation by the NLRB that college football players are actually employees and, therefore, have the right to join a union. The ruling was silent on the rights of cheerleaders... Read more in the Baker Market Update.

CLEAR Act Under Fire

As IBAT and ICBA continue to press forward with regulatory relief efforts in the form of the Community Lending Enhancement and Regulatory Relief (CLEAR) Act, several consumer groups have emerged in opposition to the bill.  The coalition, led by the Center for Responsible Lending,  voiced objection to provisions of the CLEAR Act which would relieve certain community bank loans held in portfolio from new qualified mortgage requirements in particular.

Last week, ICBA responded to concerns raised by the coalition in the form of a letter sent to all United States Senators, maintaining the safety of community bank loans and the need for greater small creditor accommodations.

“In recent years, the delinquency rate of mortgages held by community banks up to $10 billion in assets never exceeded 4 percent, compared to 8 percent to 12 percent for GSE mortgages, 22 percent for fixed rate subprime mortgages and 46 percent for subprime variable rate mortgages. In fact, community bank mortgages have outperformed fixed-rate, prime loans, thought to be the best-performing category of all loans,” the letter read.  “S. 1349 will help community banks serve their customers and communities. It will help deter further industry consolidation that would leave many rural and small town communities without access to customized and competitively-priced banking services.

IBAT staff with strong grassroots banker support have garnered a significant number of Texas Congressional co-sponsors for CLEAR.  The Act currently has 121 co-sponsors in the House and 27 in the Senate.

Flood Insurance Relief

Late last week, President Obama signed H.R. 3370, the Homeowner Flood Insurance Affordability Act of 2013, bringing an end to uncertainty related to catastrophic premium increases for those insured by the National Flood Insurance Program.  As finally passed and signed by the President, H.R. 3370 effectively:

  • reinstates grandfathered status for covered properties;
  • delays the effective date for new escrow rules from July 6, 2014 to January 1, 2016;
  • repeals the home-sale and new-policy rate-increase triggers;
  • provides a refund for people who have realized large premium increases due to the purchase of a pre-FIRM subsidized home without the full transparency from the Federal Emergency Management Agency as to the new rate structure; and
  • requires FEMA to complete an affordability study and to propose an affordability framework to help homeowners cope with dramatically higher premiums.

Silver Alert: NWS Region Fort Worth




The Addison Police Department is searching for James Gary Litzler diagnosed with a Cognitive Impairment, White, Male, 66 years old, DOB 07/19/1947, HEIGHT 6’ 2”, WEIGHT 185 lbs., Grey/ Brown Hair, Green Eye and a Grey Beard and Mustache.  Last Seen Wearing Black Baseball Cap with Vietnam Veterans Insignia and Jeans.

The senior citizen was last seen at 12:00 PM  03/20/2014 at 15701 Quorum in Addison, TX and was traveling on foot.

Law enforcement officials believe this senior citizen’s disappearance poses a credible threat to his own health and safety.

If you have any information regarding this missing senior citizen, contact the Addison Police Department at 972-450-7158.

News Media Point of Contact is Addison Police Department at 214 368-0909.

Interchange Update

Last week, the banking industry received some welcome good news as a panel of judges for the U.S. Court of Appeals overturned a lower court's decision on the implementation of the Dodd-Frank Act’s Durbin Amendment.

In July of 2013, U.S. District Court Judge Richard Leon said the Fed interpreted the statute too broadly and set the interchange cap on debit card transactions too high.  That line of thinking maintained that the Fed was prohibited from considering the cost of payment processing system maintenance and fraud in determining the interchange fees.  Luckily, the appeals court saw the unreasonableness of this argument and maintained that the Fed's rate "generally rests on reasonable constructions."

While banks under $10 billion in assets are excluded from the interchange rule, IBAT has long been concerned that the outcome of this case would create market forces long term that would certainly drive interchange rates down for all institutions.

In a related development, several merchants have filed a lawsuit against the state (AG and Consumer Credit Commissioner) seeking a declaration that the credit card surcharge prohibition is unconstitutional.  The suit, Civil Action No. 1:14-cv-190, was filed in U.S. District Court, Western District on March 5.  While not impacting the debit card surcharge prohibition spearheaded by IBAT at the last legislative session, we will obviously be watching closely as this case proceeds.

Baker Market Update: Mar. 24, 2014

A big week for Janet Yellen. Spring break? No way! Wednesday’s press conference marked the conclusion of the FOMC’s regularly scheduled one-and-a-half-day meeting, and Ms. Yellen’s first official conclave as Chairwoman. Like many, if not most of her predecessors, Ms. Yellen learned that a spoken implication may differ from a perceived inference. Based upon negative reactions in both equity and credit markets, one might think that Ms. Yellen cancelled spring break altogether. In actuality, an examination of the FOMC’s statement and a review of the post-meeting press conference reveals that there is little, if any, tangible indication that the monetary policy we’re expecting will deviate significantly from the monetary policy we’ve experienced. While the tapering of asset purchases continued as expected, Ms. Yellen signaled, also as expected, a subtle shift away from using quantitative benchmarks as markers for policy adjustments to a more flexible consideration of “a wide range of information” in determining policy adjustments. That should clear things up pretty well... Read more in the Baker Market Update.

Bank PAC Drives

...but any month will do!  We sent you some information yesterday regardingPAC Drives, and hope you had a chance to review and consider this important initiative.  

One of the major goals of the IBAT Leadership Division is to engage more of the membership in raising much-needed funds for the IBAT PACs.  The "80-20" rule is clearly reflected, and it is the ambitious goal of the Leadership Division to have every IBAT member bank participate in this important initiative.

If you are engaged, please accept our thanks. If not, please consider becoming a supporter of the IBAT PACs.

IBAT Compliance

Last week, the IBAT compliance team launched the newly redesigned Compliance homepage.  The site, which is designed for user and mobile-friendliness, provides direct links to IBAT’s most utilized compliance resources – the Compliance Forum, Legal Ease, Capitol Comments, the Compliance Helpline and resources developed for member use.

"We know that compliance costs and concerns are at the forefront of every community banker's mind," said IBAT Deputy General Counsel Shannon Phillips. "Over the last several years, we have built a tremendous body of resources for IBAT members to access, all without additional cost beyond membership dues."

If you find yourself in need of additional resources or need assistance from the IBAT compliance team, please do not hesitate to reach out to Kelly Goulart or Shannon Phillips.