The Texas Independent Banker

Independent Banker, is now available online. Click here to view the full table of contents or link directly to specific content below:

As always, if you have suggestions for future content to be featured in The Texas Independent Banker magazine, please contact Bonnie Kankel. We welcome your thoughts and ideas.

Staff contact: Bonnie Kankel, bkankel@ibat.org, 512-474-6889

Pressure Builds to Reverse HMDA

The Consumer Financial Protection Bureau (CFPB) is facing increasing calls to modify—or rescind entirely—the requirements to collect and report expanded HMDA data elements added, in part, under the Dodd-Frank Act. The Community Lending Enhancement and Regulatory Relief (CLEARR) Act introduced in late April by Rep. Blaine Luetkemeyer would repeal Dodd-Frank provisions that require the collection and reporting of certain loan data information.

Last week, the stand-alone Homeowner Information Privacy Protection Act was introduced by Reps. Randy Hultgren and Andy Barr. It would effectively accomplish the same goal by granting a one-year delay for reporting the new data while at the same time calling for additional studies. 

IBAT has consistently opposed the expansion of reporting under the CFPB HMDA rule. In a recent comment letter submitted on behalf of IBAT members, IBAT General Counsel Karen Neeley concluded with this persuasive statement:

“Only 10 of the 25 proposed data fields were directly mandated by Congress in the Dodd-Frank Act (Section 1094). We believe the CFPB has not provided any compelling evidence that the collection and disclosure of the additional data provides benefits that outweigh the significant burden it will place on financial institutions and the risk it will pose to the security of the financial information contained therein. We understand that the statutorily identified fields should be added to HMDA reporting; however, we believe the additional fields create unsupportable costs and privacy risks for consumers.”

Staff contact: Kelly Goulart, kgoulart@ibat.org, 512-275-2231

State Legislative Tidbits

We’re in the final two weeks of the 85th Texas Legislative Session, and all is pretty normal at the moment. The Senate and House are not playing particularly well together, “offended” groups are going “nuclear” and killing bills indiscriminately, tempers are flaring, and we are hoping that several of our bills currently teed up will move through the final stages to become law in the coming days. 

As has been our practice throughout the Session, we plan to send a full recap next Monday with a new edition of IBAT’s Legislative Insider.

We are also pleased to announce that IBAT's popular end-of-session webinar will be held Tuesday, June 27, 10-11:30 a.m. Registration is now open. We encourage you and your staff to listen in as we go over the good, the bad and the ugly from the 85th Texas Legislative Session.

Staff contact: Steve Scurlock, sscurlock@ibat.org, 512-275-2226

Williston Retirement Update

In case you missed Friday’s email from IBAT Chair Darla Rooke, she announced that IBAT President and CEO Chris Williston plans to delay his retirement for at least one year to maintain the momentum and avoid disruption when the prospect of meaningful regulatory relief is more likely than ever before.

Williston was originally scheduled to relinquish his President and CEO title at the end of the 2017 calendar year and stay on with IBAT through mid-year 2018 to allow for the transition to new leadership. With this news, the IBAT Executive Committee has dissolved its search committee and will begin anew at the appropriate time.

It’s time now to ensure that each and every one of us is focused on doing everything we can to get regulatory relief to the finish line.

Staff contact: Chris Williston, cwilliston@ibat.org, 512-474-6889

Baker Market Update: May 15, 2017

A reminder to all:  this coming Sunday is Mother’s Day. So, if you haven’t already done it, go out and buy something nice for your Mother. And while you’re at it, get a little something for yourself; the economy needs it. The much-anticipated Retail Sales report from the Census Bureau came out this morning and it was, in a word, tepid. So, don’t be tepid when selecting a gift for the person who brought you into this world.

Read More in the Baker Market Update

2017 BOCB Awards

It’s that time of year – time to start thinking about what your bank will submit for the 2017 Best of Community Banking (BOCB) Awards competition. This marks the 26th year of celebrating the outstanding accomplishments of IBAT member banks.

The BOCB program recognizes the vital role your bank plays in your community. It is an opportunity to showcase and honor the best-of-the-best efforts of IBAT members in four categories:

  • architectural design,
  • community service,
  • financial education and
  • marketing.

As always, all entries will be displayed at the Annual IBAT Convention in September at the Fairmont Hotel in downtown Austin. Gold award winners will be recognized during the BOCB Awards luncheon on Monday, September 11.

The entry deadline is Friday, June 30. The BOCB brochure and entry form were mailed last week so please be on the lookout for these important materials. We can’t wait to learn about the extraordinary programs IBAT banks have taken on throughout the past year! 

Staff contact: Lindsey Gehrig, lgehrig@ibat.org, 512-275-2215

Legal Ease: May 11, 2017

Wasn’t there a bill from the last legislative session (2015) that becomes effective this year (2017) that could impact the escheatment of deposit accounts and safe deposit box contents?

Learn the answer here.

Staff contact: Kelly Goulart, kgoulart@ibat.org, 512-275-2231

Legal Ease is chosen from questions received through the IBAT Compliance Adviser Helpline, available to IBAT members free of charge at 1-800-749-4228 or kgoulart@ibat.org. IBAT members can also read and/or initiate discussions with other community bankers in the IBAT Compliance Forum. The Legal Ease archives are also available on IBAT2GO, the official IBAT mobile app.

Economic Outlook

The following information was provided by Alan Blinder, Vice Chairman and Co-Founder of Promontory Interfinancial Network, and Professor of Economics and Public Affairs at Princeton University. It can also be found here.

The Federal Open Market Committee met on May 2-3. To no one’s surprise, they announced no changes in policy, nor even—it appears—to the outlook for future policy. Why should they?

True, there were some “blips” in recent data—actually large ones. First-quarter GDP growth came in at a measly 0.7%, annualized, and core inflation dipped negative for a month in March. The Fed’s statement acknowledged both developments, but evinced no concern with either. For GDP, they said, “The Committee views the slowing in growth during the first quarter as likely to be transitory.” The negative inflation figure was simply mentioned, with no commentary whatsoever.

So the “about 2%” forecast remains intact: about 2% real growth, and about 2% inflation. Private sector forecasters are pretty close to the Fed on this. And most of them expect another 25 basis point rate hike at the June meeting. Seems a good bet.

If there was any suspense at all going into the May meeting, it was about whether the FOMC have anything to say about plans for shrinking its balance sheet. It didn’t—which was, again, as expected. Some information might come in June, but seems more likely in September or even December. Fed watchers, it seems, can continue to relax.

Staff contact: Mark Few, mfew@ibat.org, 512-275-2224

FinTech Showcase

Two weeks ago we provided links to half of the seven-minute product demos presented at last month's FinTech Showcase. We hope you had a chance to watch part one and found new products that could help your bank meet technology, customer service and marketing needs.

Here are the rest of the demo companies that presented at this year's FinTech Showcase:

Staff contact: Julie Courtney, jcourtney@ibat.org, 512-275-2227

2017 D.C. Visit

It was an impressive showing! More than 120 Texas community bankers and industry partners traveled to Washington, D.C. last week to take part in IBAT’s 25th Annual Congressional Visit. 

Click on the image to enlarge.

Thirty-plus offices of the Texas Congressional Delegation were visited prior to group meetings, which featured Texas Senators John Cornyn and Ted Cruz, plus briefings by Senator Jerry Moran (R-KS); Congressmen Jodey Arrington (R-TX) and Pete Sessions (R-TX); and House Financial Services Committee members Blaine Luetkemeyer (R-MO), Roger Williams (R-TX) and Kyrsten Sinema (D-AZ).

Moran and Leutkemeyer have sponsored companion bills in the Senate and House (see related story below) that provide targeted and comprehensive regulatory relief for community banks.

“I remain hopeful and optimistic that this Congress will finally address and reverse some of the troubling provisions of Dodd-Frank that have disproportionately affected community banks,” said IBAT Chairman Darla Rooke. “There continues to be bipartisan support for community bank relief, but we have come to know that nothing happens quickly in the United States Congress.”

Many of the Texas attendees also participated in ICBA’s Capital Summit during which House Financial Services Committee Chairman Jeb Hensarling and Treasury Secretary Steve Mnuchin were featured speakers. Both relayed their strong support for relief not only through the legislative process but also with the selection of new leaders to be appointed at the federal regulatory agencies.

IBAT wishes to thank all attendees for their passion and time to make the trip such a success.

Staff contact: Steve Scurlock, sscurlock@ibat.org, 512-275-2226

Legislation on the Move

Three pieces of legislation important to Texas community banks are on the move in the 115th Congress. Last week saw:

  1. The passage of Chairman Jeb Hensarling’s Financial CHOICE Act from the House Financial Services Committee. As reported previously, IBAT supports the CHOICE Act, which contains many of the provisions in ICBA’s Plan for Prosperity. The House is expected to consider the bill by the end of May.
  2. Introduction of the CLEAR Relief Act by Senator Jerry Moran. The bill is a companion to House legislation filed by Rep. Blaine Luetkemeyer and has bipartisan support from Senators Heidi Heitkamp and Jon Tester. Each bill includes much-needed relief from onerous mortgage rules that limit credit availability for community bank customers, among other provisions.
  3. Introduction of the Capital Access for Small Business Banks Act by Rep. Kenny Marchant. The bill would increase the number of shareholders allowable for Subchapter S banks from 100 to 500 and permit the issuance of qualified preferred bank stock for Sub S banks.

Check future issues of The Bottom Line for updates on these and other items on IBAT’s proactive legislative agenda in the months ahead.

Staff contact: Steve Scurlock, sscurlock@ibat.org, 512-275-2226

Texas Legislature

Only 20 days to go! The pace of activity at your Texas Capitol has reached the normal fever pitch for this juncture of the session, as deadlines are looming and time is running out. The IBAT legislative team is juggling a wide range of issues and has provided some of the highlights in the most recent issue of the Legislative Insider that hit your inboxes yesterday afternoon.

There will, most likely, be one or more “calls to action” over the next several weeks. As we’ve stated in the past, we send emails out only when needed and hope you will respond accordingly to weigh in on these important issues.

Staff contact: Steve Scurlock, sscurlock@ibat.org, 512-275-2226

Baker Market Update: May 8, 2017

A nod is as good as a wink to a blind horse. To some, that phrase is just a befuddling line from an old Rod Stewart song. To others, it may mean that a subtle gesture is all that is needed to convey one’s intent.  Or, perhaps it just acknowledges that one meaningless gesture is as good as another. So, one wonders which description best applies to the FOMC’s meeting earlier this week. Maybe all of them. Some may find it befuddling that any central bank would want to raise rates in an economy growing at less than 1%. Describing that weakness as “transitory” may be the Fed’s delicate way of signaling its intent to continue down the higher-rate path no matter what. Maybe it just means the May meeting was nothing more than a place-holder while investors prepare for the inevitable.

Read More in the Baker Market Update

IBAT Sent a Comment Letter

IBAT sent a comment letter to Texas Attorney General Ken Paxton in response to a recent opinion request. A county clerk expressed concerns about accepting affidavits of adverse possession for filing. These have commonly been used as a tool to clean up titles, particularly in rural areas. So long as they are properly notarized, the law would appear to require that they be accepted. IBAT urged Paxton to so opine.

IBAT chimed in on this opinion request out of concern that this common practice could be adversely affected. The result could be harmful to community bank customers and the banks which are willing to accept their real property as collateral.

Staff contact: Karen Neeley, kneeley@kslawllp.com, 210-802-4631