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ICBA’s Fine: April is Go Time for Community Banks

ICBA NewsWatch Today 04/14/2014

AdvocacyICBA’s Fine: April is Go Time for Community BanksCommunity bankers have a unique opportunity this month to build on recent successes by participating in both Community Banking Month and the ICBA Washington Policy Summit, ICBA President and CEO Cam Fine wrote in his latest blog post. In his latest Finer Points blog post, Fine noted that ICBA is offering community bankers a Marketing and Communications Toolkit throughout April to help our industry build awareness and support nationwide. Additionally, ICBA launched a promotional blitz in the nation’s capital in recognition of Community Banking Month and in preparation for the upcoming ICBA Washington Policy Summit, Fine wrote. “We have to keep pushing if we want to ensure a sound future for community banking. Read the Blog Post. HousingICBA, Coalition Advocate Changes to GSE-Reform ProposalICBA and a coalition of credit union associations recommended changes to a housing-finance-reform legislative proposal introduced by Senate Banking Committee Chairman Tim Johnson (D-S.D.) and Ranking Member Mike Crapo (R-Idaho). In a joint letter to the lawmakers, the coalition said it appreciates that the proposal would create a separate mutual corporation to allow small lenders equal access to the secondary market and the ability to continue selling individual loans for cash. However, the coalition addressed several concerns and offered recommended changes. The coalition’s recommendations include:

  • prohibiting any institutions from being a guarantor if they are an aggregator or an originator,
  • allowing only approved guarantors to provide the required credit support in front of the Federal Mortgage Insurance Corp. (FMIC) guaranty,
  • requiring FMIC to rely on the prudential banking regulators for safety-and-soundness examinations,
  • including at least two community bankers on the board of the mutual cooperative for small lenders,
  • providing more mortgage-lending flexibility to smaller lenders,
  • requiring lenders to notify senior lienholders of any covered loan upon consummation of any junior lien where the combined loan to value exceeds 80 percent, and
  • provide a streamlined process for mutual membership to institutions under $500 billion in assets approved to sell loans to Fannie Mae and Freddie Mac at the time of transition.

ICBA will continue working with Congress and the administration to ensure housing-finance reforms meet the association’s principles and avoid further concentration of the banking industry.MutualsICBA Backs New Charter, Capital Options for Mutual BanksICBA expressed its support for legislation to provide a new national charter option for mutual banks and to create a new capital option to strengthen the long-term viability of mutual banks. The Mutual Bank Choice and Continuity Act of 2014 (H.R. 4252) would establish a new Office of the Comptroller of the Currency charter for mutual national banks. It also would authorize mutual banks to issue Mutual Capital Certificates that would qualify as Tier 1 common equity capital. In a letter to the bill’s sponsor, Rep. Keith Rothfus (R-Pa.), ICBA wrote that the bill would provide flexibility for institutions to choose the charter that best suits their needs and the communities they serve. It also would provide a new capital option that would help preserve the viability of mutual banks and allow them to continue serving their communities, ICBA wrote. These provisions are consistent with ICBA’s Plan for Prosperity, the association’s regulatory relief platform for the 113th Congress. SecurityFinancial Regulators Expect Firms to Address OpenSSL “Heartbleed” VulnerabilityFederal financial regulators said they expect financial institutions to incorporate patches on systems and services, applications, and appliances using OpenSSL and upgrade systems as soon as possible to address the vulnerability. The Federal Financial Institutions Examination Council members said financial institutions should consider replacing private keys and X.509 encryption certificates after applying the patch for each service that uses OpenSSL and consider requiring users and administrators to change passwords after applying the patch. Financial institutions relying upon third-party service providers should ensure those providers are aware of the vulnerability and are taking appropriate mitigation action, the FFIEC said. OpenSSL is a cryptographic software library used to authenticate services and encrypt sensitive information. A significant vulnerability known as “Heartbleed” has been found in OpenSSL that could allow attackers to decrypt, spoof or perform attacks on network communications that would otherwise be protected by encryption. Read FFIEC Alert. ICBA NewsWatch Today is sponsored by Holtmeyer & Monson:Earn a 12-14% premium on the sale of SBA loan guarantees in the secondary market. One big reason why community banks are taking advantage of SBA Lending in record numbers! And the ICBA recommends just one provider to make the process hassle-free for its members. Call us today to get started. ICBA Preferred Service Provider Holtmeyer & Monson does all the work, at no net cost to your bank. Call (800) 340-7304 or visit Participant Lending Up $12.5B Over BaselineCommunity banks participating in the Small Business Lending Fund have increased small-business lending by $12.5 billion over baseline levels through the fourth quarter of 2013, Treasury reported. Lending was up $1.3 billion over the previous quarter. The reported aggregate lending increase represents an estimated 56,900 additional loans to small businesses, according to the data. Treasury provided more than $4 billion in capital to 332 institutions through the SBLF, which encourages small-business lending by reducing the rate on SBLF funding as participants lend more. ICBA led the effort to work with policymakers to enact and implement the SBLF to provide community banks another source of reasonably priced capital. PaymentsFed Seeking Feedback on Payments FraudThe Federal Reserve Banks are seeking feedback on a payments fraud survey of financial institutions and businesses. The online survey is designed to help the reserve banks better understand new or continuing challenges with payments fraud and methods financial institutions use to reduce fraud risk. Feedback will be publicly shared as aggregate, summary-level data. The survey is scheduled to close on May 9. Take the Survey. PollTake This Week’s Quick PollTake this week’s Quick Poll on community bank congressional open houses, and view results from the previous poll on the end of Microsoft support for Windows XP. View the Archive.EducationICBA Webinar Tomorrow Covers FFIEC Guidance on Social MediaFollowing the recent issuance of final guidance from the FFIEC on the risks of social media, ICBA is hosting a webinar tomorrow on how financial institutions and their employees are using social media and how to mitigate the risks involved. “New FFIEC Guidance on Social Media” is scheduled for 11 a.m. (Eastern time) tomorrow. Register Online.Products and ServicesWebinar Features How to Earn CRA Credit by Combating Elder AbuseICBA and the Senior Housing Crime Prevention Foundation are hosting an upcoming webinar on the nationally acclaimed Senior Crimestoppers program to protect seniors from abuse, neglect and exploitation. Funding for this program comes exclusively from the banking industry and can serve as an easy way for community banks to earn valuable Communities Reinvestment Act credit. The webinar is slated for 11 a.m. (Eastern time) this Wednesday. Register Today.Products and ServicesFree Webinar: Ag Lending—Back to the 1980s? Not Yet!WebEquity Solutions, an ICBA Preferred Service Provider, is hosting a webinar at 2 p.m. (Eastern time) this Thursday titled “Ag Lending—Back to the 1980s? Not Yet!” Across the country, there are varying attitudes about agricultural stability. This webinar will feature changes in the ag landscape and their impact on ag lenders. The webinar will look at when times were simpler, guidelines for the “uneasy” times, critical credit analysis and how to have the hard “Farmer Talk” discussions. Register Online.Products and ServicesWebinar: RDC Solutions for Your Customers…Done Their WayEveryone in the industry has heard that remote deposit capture (RDC) can attract and retain valuable customers. As the market evolves, did you know that your RDC options are expanding? There’s no need to endure a one-size-fits-all approach when you can tailor your solutions to reach any market segment, from corporations to small and mid-sized businesses (SMBs) to individual consumers. ProfitStars, an ICBA Preferred Service Provider, will help you understand RDC solutions are right for your community bank during this webinar scheduled for 2 p.m. (Eastern time) this Thursday. Register Now.

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