E-NEWS
February 17, 2016
Announcements and News

Sen Rounds
Senator Mike Rounds
Senators Rounds and Group of 
Senate Banking Committee Members Question Progress of Mandatory Regulatory Review

A group of Senate Banking Committee members asked federal financial regulators to provide a status report on their ongoing mandatory regulatory review under the Economic Growth and Regulatory Paperwork Reduction Act of 1996. In a letter to agency heads spearheaded by Sen. Mike Crapo (R-Idaho), the senators asked which regulations have been identified as outdated, unnecessary or unduly burdensome under the EGRPRA review and how regulators will go about addressing these issues to reduce regulatory burdens.

In their letter, the committee members noted that the 2006 EGRPRA review was criticized because regulators failed to repeal many substantive regulations, while regulatory burdens have increased significantly in recent years. EGRPRA requires a comprehensive regulatory review every 10 years.

Read the full letter here

Learn about Member Networks?
Join us for a short fifteen minute Q&A session with Greg McCurry from the ICBSD and Networks facilitator, Karl Nelson, from KPN Consulting. 
Network Membership Fee
$750 Network Membership
$500 for each additional registration
* Discount Code will be emailed immediately following your first Network Registration
$250 Leadership Network Fee
*  Discount Code for a free Leadership Network registration will be emailed immediately following your first Network Registration
View more information at www.icbsd.com/networks
New Dell Discounts
ICBSD members can take advantage of the following price breaks!
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More Information: Place your order through the ICBA/Dell page to receive these discounts!

2016 Legislative Session Notes
HB1126 - Exempt certain entities from provisions related to money lending license
This bill was first read in House on 1/27/2016 and referred to House Commerce and Energy. 

HB1126 is at the request of private equity groups.  If passed the bill will exempt them from needing to obtain a money lending license for activities related to lending.
 
The specific exemptions within the bill are:
  • Any entity which has made or acquired no more than 10 loans to other entities within any calendar year.
  • Any entity that purchases and services commercial loans acquired for investment purposes. In addition, the bill would exempt "any nonresidential real estate mortgage licensee" from licensure under South Dakota's mortgage lending licensing statutes.
If this bill passes, the firms would be exempt from franchise tax on income from lending activities. 
 
Historically, community bankers have not been in favor of any other entity engaged in banking activities and not having to comply with the same taxes and regulations.
 
The ICBSD Board of Directors voted at the February 9 th board meeting to opposed this legislation. 
 
Referred to House Commerce Committee, scheduled for hearing 2/17/16.  (Members-Beal, Harrision, Hawley, Kirschman, A. Novstrup, Rounds- chair, Schoenbeck- vice chair, Stalzer, Steinhauer, Wiik, Willadsen, Wollman, Zikmund)
 
This bill would reduce the penalty for unauthorized credit card use from a Class 6 felony to a class 1 misdemeanor if the theft is less than $1,000. 

The House Judiciary  committee deferred  the bill to the 41st day on an 8-2 vote. 

SB52 -  Establish procedures for reporting federal tax changes for purposes of bank franchise tax
Proposes to clarify the filing process for banks in the event the taxes due the state of SD increase or decrease as a result of an audit or adjustment of federal taxable income by the IRS. 

Bill passed out of committee and has been placed on the Senate consent calendar where it passed.  The bill has now been referred to House Taxation. 

SB53 -  Revise certain provisions concerning the bank franchise tax
This bill proposes technical changes to the bank franchise law.

Passed out of Committee on a 7-0 vote. Amendments passed by a slim margin of 4-3 the amendments offered a few changes to the bill, the mandatory electronic filing provision was removed as well as the Department of Revenues repeal of graduated rates on income above $400 million.  The Senate passed as amended 34-0.   

The bill has been assigned to the House Taxation Committee.

SB54 Adopt Elder Abuse Task Forces statutory recommendations
Collaborative effort led by the Supreme Court Justices, Supporters included the Governor's Office, Attorney General's Office, State Bar, AARP, SD Health Care Alliance, and Family Heritage Alliance.
 
Scheduled for hearing by the Senate Judiciary Committee passed 6-0, the full Senate passed 35-0 and           

The bill has not been assigned to the House Judiciary Committee. 

SB57 -  Redefine the term written agreement relating to contracts between a debtor and creditor
Codifies current industry practice recognizing electronic signatures on contracts.

The bill passed the Senate without opposition and is now assigned to the House Commerce Committee.

IBC will continue to monitor the bill and the Governor's Task Force. 
 
HB 1039 passed the House of Representatives unopposed and was referred to Senate State Affairs where  it also passed unopposed and was places on the consent calendar.  The bill has been signed by both the Speaker and President of the respective chambers.

This is an annual bill used to update South Dakota tax code, it passed both chambers with no dissenting votes and has been signed by the Speaker, the President and delivered to the Governor. 

HB1086 -  Create a leased residential property classification 
Creates a new category of property tax for assessment purposes by differentiating multi-housing from commercial property.
 
House Taxation passed 12-3 amended.  The full House did not pass the bill 28-39 and also failed to reconsider.
ICBSD Lobbyist Dean Krogman
Cell: 605-695-3497
Email: 
dkrogman@sdma.org

We will be attending hearings as  necessary  to make sure the community banking  voice is being heard. 

As your voice for community banks, please do not hesitate to contact us if you have concerns about any of the bills we are monitoring or another bill currently before the legislature.
Who are Your Legislators? 

You can use this site to find your legislators based on city, county, or district. If you need more details, you can use the interactive district map to zoom into your street and find your district.

Look up your Legislators Here
Bank Member News
Community Bank Using the Power of Facebook to Promote Local Events 
The State Bank of Alcester is using the power of Facebook and social media to spread the word about events and happenings in the city of Alcester.  Through focusing social media efforts not only on the activities of the bank, they have been able to gather over 380 followers on Facebook and provide a valuable service to the community of Alcester.  

Send us your bank news, events and job openings!
Contact Summer at  sgeraets@icbsd.com .
Associate Member News and Events
Security Interests in Insurance Proceeds
Davenport, Evans, Hurwitz & Smith, LLP
Keith A. Gauer,  Partner

Generally speaking, Article 9
of the Uniform Commercial Code interest in accounts, general intangibles, and payment intangibles may not  does not cover claims of a debtor under a policy of insurance. As such, a general security agreement granting a lender a security  provi de the lender with a perfected security interest in the proceeds of an insurance policy maintained by the borrower.

Read More... 
Successful Branch Transformation Begins with the Consumer
The way consumers bank is undergoing a fundamental change. With the proliferation of mobile and online banking, self-service devices, and other innovative solutions, consumers have more options than ever when it comes to performing banking transactions. As consumers migrate towards digital channels, and as banking habits continue to fluctuate, Financial Institutions (FIs) are turning to Branch Transformation Strategies to accommodate the changes. When looking for new solutions and determining which Branch Transformation Strategies to implement, it is important for Financial Institutions to truly understand their customers' banking preferences.
Banks to Request Direct Access to DOD Database  to Verify Military Status of Lo an Applicants
 
The database is one way lenders can verify the military status of applicants applying for consumer credit, and can be used as a safe harbor for complying with the new Military Lending Act (MLA). The upcoming October 3, 2016, changes to the MLA will broaden the types of loans covered, by including more consumer credits under the umbrella of the MLA.

Open Position...
United Bankers Bank
Vice President of Lending, South Dakota

United Bankers' Bank (UBB), headquartered in Minnesota, has an opportunity for a motivated VP of Lending. This individual will be based in Sioux Falls. UBB is a successful and growing bankers' bank that supports community banks in the Midwest and Pacific Northwest. Our motto, "First, for Your Success" reflects the importance UBB places on helping customers and employees succeed.

The VP of Lending's objective is to engage in ongoing discussion with client banks in order to obtain the opportunity to assist them with over-line and bank stock loan requests. They will contribute significantly to department and bank objectives of excellent credit quality, excellent customer service and outstanding returns to shareholders.
Commercial Loan Officer
 
Our client, Pioneer Bank & Trust located in Rapid City, SD, is seeking a highly motivated individual to join its lending team in the position of a Commercial Loan Officer. The successful applicant will be responsible for developing, servicing and retaining profitable customer relationships.
 
Qualifications include a bachelor's degree in accounting, finance or business. The individual must demonstrate strong communication and leadership skills and be committed to participate in and promote community activities. A minimum of 5 years of experience as a commercial lending officer is preferred.
 
Pioneer Bank & Trust is a locally owned, totally independent community bank that has been serving the banking needs of Western, SD since 1913 and offers a comprehensive compensation and benefits package. Pioneer Bank & Trust is proud to be an affirmative action/equal opportunity employer. EOE AA M/F/Vet/Disability
 
To apply, please visit -
Send us your news, events and job openings!
Contact Summer at  sgeraets@icbsd.com .
ICBSD Events
ICBA Events

ICBA National Convention March 6-10, 2016

ICBA Washington Policy Summit- April 24-27, 2016

Upcoming Community Bankers Webinar Network Courses 
SBS Institute Certifications
February 2016 

March 2016


April 2016
April 4 - CBSTP, Certified Banking Security Technology Professional

April 11 - CBEH, Certified Banking Ethical Hacker

From the Web
Should Banks Expect New Cybersecurity Guidance 
How will federal banking regulators respond to growing criticism of the Cybersecurity Assessment Tool issued by the Federal Financial Institutions Examination Council? 
Millenial Advice on How to Run a Bank  
Leading a community bank, especially in the last decade, requires tremendous resilience and fortitude. Managing and motivating staff, ensuring regulatory compliance, and boosting revenue and assets are undoubtedly a tough job. 
Measuring Marketing Success: We're Doing It Backwards
What actually drives a customer or prospect to take a desired action? The answer is extremely complex and difficult to measure, so we tend to adjust our objectives to match what we can measure. It's kinda like drawing the target after firing the shot.
The Traditional Community Banking Model is Dead 
Consumer banking needs have not changed all that much over the last decade. However, the way those needs are met are going through transformational change.
Banking.com     
Can Anything Become a Payment Device? MasterCard Thinks it Can  
Could you foresee your fridge able to make a payment for you--to buy your milk before you run out? Would it be possible to have your gas meter automatically complete a transaction for you so don't have to remember to pay the bill?
Branches Should Not be Museums    
I think we can all agree that branches should not be museums. Many financial institutions may need to weigh their options for transforming older, inefficient branches into profit centers that entice customers to stop in.        
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Banking Fun Facts

Financial Services Mondernization Act of 1999

Signed by President Clinton in November 1999, the Financial Services Modernization Act of 1999 (commonly called the "Gramm-Leach-Bliley Act") transformed the U.S. banking system, allowing banks to engage in a broader array of related financial activities. Read more here.  
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What's New?
What's happening at your bank? Events? Promotions? New hires? Retirements? Awards? Community projects? Charitable activities?

Contact Summer at sgeraets@icbsd.com. If you don't have time to write an article, send a description of what happened, and we'll put it together for you.