February 21, 2018
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Senate Banking Committee members Ben Sasse (R-Neb.) and Doug Jones (D-Ala.) have signed on as co-sponsors of S. 2155, the bipartisan financial regulatory reform bill expected to receive a Senate vote in the coming weeks. Sasse and Jones bring the number of co-sponsors to 26 - 13 Republicans, 12 Democrats and one independent aligned with Democrats.
 
The result of a bipartisan compromise between Senate Banking Committee Chairman Mike Crapo (R-Idaho) and four Democrats on the committee - Jon Tester (D-Mont.), Heidi Heitkamp (D-N.D.), Mark Warner (D-Va.) and Joe Donnelly (D-Ind.) - S. 2155 includes several pro community banking provisions including a Qualified Mortgage designation for mortgages held in portfolio, a substantial increase in the SIFI designation threshold and relief from stress tests and exam requirements for certain institutions.

The Bill  >>> 
More Reg Relief Bills Passed by the House 
 
The House passed two bi-partisan bills to ease regulatory burdens on community banks.  H.R. 3299 passed with a 245 to 171 vote. Providing a much-needed fix for confusion created by the Madden v. Midland Funding decision, in which the Second Circuit decided that state usury laws apply to debt purchased from a national bank. It codifies the "valid-when-made" doctrine
. This doctrine ensures that validly made loans remain valid when they are sold or assigned, thus promoting transparency and predictability in the secondary market.

The House also passed the TRID Improvement Act (H.R. 3978), sponsored by Reps. French Hill (R-Ark.) and Ruben Kihuen (D-Nev.). The bill, which passed 271-145, clarifies the disclosure of homeowners' title insurance to mitigate consumer confusion. 
Equifax Data Breach Worse Than Thought  
  
The Equifax data breach was even worse than previously disclosed, the credit reporting agency told the Senate Banking Committee. In a document submitted to the committee, Equifax added tax identification numbers, email addresses and phone numbers to the personal information illicitly accessed last year.

Equifax previously announced that names, Social Security numbers, birth dates and other information were compromised in the 2017 breach of 145.5 million consumers and 209,000 payment cards.

ICBA last month issued frequently asked questions on its lawsuit against Equifax as community banks continue to file cases against the credit bureau. Citing Equifax's failure to heed warnings about the security of its U.S. website, these lawsuits seek monetary relief for community banks affected by the breach.

Community banks interested in filing a complaint against Equifax can learn more by visiting ICBA's Data Breach Information Center
.

Equifax FAQ's  >>>
ICBA Data Breach Center  >>> 
Data Security Bill Drafted                 
 
Reps. Blaine Luetkemeyer (R-Mo.) and Carolyn Maloney (D-N.Y.) released a draft bipartisan data security bill today. The bill would provide broad standards for data protection across industries and create new federal post-breach notification requirements.
 
The draft legislation would set consistent, scalable standards for what businesses that handle sensitive personal data must do to protect that data. It also establishes steps that covered entities must take to notify regulators, law enforcement and victims after a breach exposing records of 5,000 or more consumers.
 
The bill designates the Federal Trade Commission as the regulatory and enforcement agency for non-depository institutions; the prudential regulators would continue to oversee how banks and their affiliates protect data under the Gramm-Leach-Bliley Act, and compliance with those agencies' regulations would constitute compliance with the Luetkemeyer-Maloney bill. Under the current draft, FTC action in response to a breach would preempt state enforcement actions, and depository institutions would be exempt from actions brought by state attorneys general.
  

The Bill Draft  >>>  
Money Services Businesses Do Not Deserve De-Risking  
                
State regulators are committed to the responsible oversight of money service business (MSBs) and creating new solutions to keep pace with emerging and evolving risks that may impact the industry.
 
These actions address a major concern: MSBs are too often the victim of de-risking - a practice in which MSBs are shut out of banking services, said Bryan Schneider, Secretary of the Illinois Department of Financial and Professional Regulation, at a hearing before the U.S. House of Representatives Subcommittee on Financial Institutions and Consumer Credit.
 
Schneider, who also chairs the Conference of State Bank Supervisors (CSBS) Emerging Payments and Innovation Task Force, noted that state regulators are not just holding MSBs accountable; through CSBS they also are taking the following action:
  • Tracking MSB transactions through CSBS's nationwide licensing system, which shows MSBs were on pace to handle over $1 trillion in transactions during 2017.
  • Providing self-assessment tools for MSBs to reduce uncertainty surrounding compliance, increase transparency and address de-risking.
  • Soliciting industry input and solutions on financial technology through an advisory panel to help state supervisors streamline and solve licensing and regulation friction points.
  • Creating a new technology platform designed to transform state examinations and help states respond to increasingly borderless financial markets.
Also, several states announced an agreement stating that if one of the participating states reviewed key elements of state licensing for an MSB, all would accept the results.
 
2019 Budget Proposes Cuts to Ag Spending

The Trump administration's fiscal 2019 budget proposal calls for significant cuts to crop insurance and the business-and-industry loan program.

The USDA's budget proposes restricting crop insurance to producers if they have more than $500,000 in adjusted gross income, limiting reimbursements to private-sector deliverers, limiting underwriting gains to companies, and reducing producer premium subsidies by 10-15 percent.  

The budget also proposes to eliminate the USDA's B&I guaranteed loan program, which last year provided more than $800 million in guaranteed loans.

It would reduce guaranteed farm operating loan volume from $1.87 billion to $1.6 billion, but maintain the no-cost guaranteed ownership real estate program at $2.75 billion.   

USDA Budget Summary  >>> 
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