Lastly, IBANYS' annual visit to Washington, D.C. takes place April 28 - May 1 during the ICBA Capital Summit. We will schedule meetings "on the hill" with members of the new York congressional delegation. New York has five new members in the delegation, and six members on the House Financial Services Committee. We need a strong showing to represent our New York industry and make our voice heard. Bring your ideas and voice to Washington by emailing me or Steve Rice. Read more about ICBA's Capital Summit.

Our 2019 Meeting dates and locations are now available! These educational conferences cover various subjects that are important within the community banking industry, spoken by the experts. T hey are also a great opportunity to network and earn CPE credits. Here is what we have planned for 2019:

The Fereral Reserve's FOMC decided to leave its benchmark interest rate target unchanged at 2.25 percent to 2.5 percent, and vowed to take a "patient" approach toward further hikes.  Federal Reserve Chairman Powell issued his strongest statement yet that the Fed has changed its outlook regarding interest rate hikes, noting: "The case for raising rates has weakened somewhat." He added the funds rate is in the committee'srange of a neutral rate estimate, a key measure for the Fed.

 Credit Union Rule Abandons Urban Cores

ICBA and state community banking associations joined an industry legal brief backing the American Bankers Association's appeal in its lawsuit against the National Credit Union Administration.  The NCUA's October 2016 final rule significantly expanded the service areas in which community credit unions can do business. A federal judge last year vacated two provisions of the rule that would have defined combined statistical areas with fewer than 2.5 million people as local communities and increased the population limit for rural districts to 1 million.  ABA's appeal challenges the court's decision to leave in place a provision of the rule allowing credit unions to serve metropolitan areas without serving their urban core. The brief also urges the appellate court to uphold the lower court's ruling that the NCUA rule unreasonably defines rural districts to automatically include entire states and major metro centers.

New York's Rep. Nita Lowey Is Among Key Conferees

	Nita Lowey

Now that the government has been temporarily reopened (the President signed a stopgap spending bill on Friday to keep the government funded until Feb. 15), Congress has already agreed to go to conference, setting the stage for formal negotiations over a border security package and a homeland security funding bill, with the biggest hurdle certain to be the border wall. 

Senate conferees include Richard Shelby (R-Ala.), Shelley Moore Capito (R-W.V.), John Hoeven (R-N.D.), Roy Blunt (R-Mo.), Patrick Leahy (D-Vt.), Dick Durbin (D-Ill.) and Jon Tester (D-Mont.)  House confereees consist of Nita Lowey (D-N.Y.) , Lucille Roybal-Allard (D-Calif.) Barbara Lee (D-Calif.), Pete Aguilar (D-Calif.) David Price (D-N.C.), Henry Cuellar (D-Texas), Kay Granger (R-Texas), Chuck Fleischmann (R-Tenn.), Tom Graves (R-Ga.) and Steven Palazzo (R-Miss.)

New Yorkers Named To Chair Key House 

Financial Services Subcommittees

From left to right: Carolyn Maloney, Greg Meeks &  Nydia Velazquez

Democrats have named their members for the various subcommittees of the House Financial Services Committee, and two New Yorkers will chair key subcommittees .

• Rep. Carolyn Maloney (D-Manhattan) has been named to chair the Subcommittee on Investor Protection, Entrepreneurship and Capital Markets. It has jurisdiction over has jurisdiction over U.S. securities and housing finance laws and the governmental entities authorized to implement and enforce those laws, including the SEC, Financial Industry Regulatory Authority (FINRA), and the Federal Housing Finance Agency and its regulated entities Fannie Mae, Freddie Mac and the Federal Home Loan Banks. Her fellow New Yorker, Rep. Greg Meeks, joins her on that Subcommittee, and on the Subcommittee on Monetary Policy and trade. 

• Rep. Greg Meeks (D-Queens) will chair  the Subcommittee on Financial Institutions and Consumer Protection. It has jurisdiction over federal law governing depository financial institutions and the provision of consumer credit, and oversees all prudential banking regulators, e.g. the FDIC, Federal Reserve, nonbank financial services providers such as consumer reporting agencies, and all matters pertaining to consumer credit. Rep. Maloney and Rep. Nydia Velazquez (D-Brooklyn) are also on that subcommittee. 

• Rep. Velazquez is also on the Subcommittee on Housing and Insurance, which oversees oversees H.U.D. (including the FHA), the Government National Mortgage Association (Ginnie Mae), the Rural Housing Service (RHS) at the U.S. Department of Agriculture and the Federal Insurance Office (FIO) at the Department of Treasury. 

How Will Ocasio-Cortez Use Her Seat On 

Financial Services Committee?

Alexandria Ocasio-Cortez

First-term Democratic Rep. Alexandria Ocasio-Cortez (D-Bronx/Queens) hoped for a seat on the House Ways & Means Committee, but instead ended up assigned to the Financial Services Committee. "City & State" notes Ocasio-Cortez's plans include digging into predatory lending and exploring options for public banking. She has placed a number of national p riorities on her agenda that fall within the committee's scope." 

Ocasio-Cortez has also identified  "digging into the student loan crisis. . .and exploring the development of postal banking" as among her priorities.   Even if her agenda is unable to pass in this Congress, a partnership with Committee Chair Maxine Waters (D-CA) presents an opportunity to leverage the financial committee's "bully pulpit" to browbeat Wall Street. The analysis concludes: "Ocasio-Cortez's power is significantly boosted by this assignment, giving her an opportunity to target both Wall Street and put pressure on establishment Democrats."

Plans To Reform Fannie Mae & Freddie Mac

The Trump administration will reportedly work with Congress to develop a plan for reforming Fannie Mae and Freddie Mac. A White House spokeswoman said the administration plans to issue a framework on housing-finance reform "shortly" and will work with Congress as part of the process. Acting Federal House Finance Agency (FHFA) Director Joseph Otting reportedly told agency staff the administration plans to unilaterally end the conservatorship of Fannie and Freddie and capitalize the enterprises. Otting (the Comptroller of the Currency) is Acting FHFA Director pending Senate confirmation of Mark Calabria (currently Chief Economist to Vice President Pence) to lead the agency. ICBA continues working with policymakers to ensure housing-finance reform meets the needs of community banks and the customers they serve, including the need to adequately capitalize Fannie and Freddie, minimize disruptions to the system, and preserve access to the secondary market for financial institutions of all sizes.

Treasury To Borrow $1 Trillion Again To Finance Budget Deficit

According to Wall Street forecasts, Treasury is projected to borrow $1 trillion for a second straight year to finance the government's budget deficit. The bipartisan Congressional Budget Office has said the government will need to spend about $7 trillion to service its debt in the next 10 years.

The Shutdown's Impact On The Economy:

 Positive Impact Of 2017 Tax Reform Eroded

According to the White House's projections, the government shutdown that ended Friday had already eroded the positive impact of tax reform and spending increases signed by Trump in 2017.  Chairman of the Council of Economic Advisers Kevin Hassett  recently said  the shutdown reduces quarterly annualized economic growth by 0.13 percentage points for every week that it lasts. The Committee for a Responsible Federal Budget noted: "After more than four weeks, that's the equivalent of a 0.6 percent reduction in the annualized growth rate."  

The Congressional Budget Office reports that the shutdown cost the U.S economy about $3 billion in economic activity that won't be recovered. The Internal Revenue Service - unfunded throughout the five-week shutdown - will collect about $2 billion less in tax revenue in fiscal 2019, much of which will not be recouped.

Consumer Confidence Down, Economic Growth Still Strong

The Conference Board, a business research group, said Tuesday that its consumer confidence index fell to 120.2 in January, down from 126.6 in December and the lowest level since July 2017. 

U.S. consumer confidence fell to its lowest reading in a year and a half, due partially to the government shutdown and volatile financial markets. The index measures consumers' assessment of current economic conditions and their expectations for the next six months. Both declined in January. Consumers' expectations for the future dropped to the lowest point since October 2016. However, economic growth was 3.4 percent annual pace from July through September, after having surged 4.2 percent in the second quarter, and the unemployment rate of 3.9 percent was near its lowest level in five decades.

Fed Names New Head Economist

Stacey Tevlin

The Federal Reserve has announced a new head economist , naming an internal candidate to lead its crucial research division at a time of slowing economic growth in the U.S. and abroad. Stacey Tevlin , an economist with the Fed's Washington-based board of governors, will succeed David Wilcox as director of the central bank's division of research  statistics on Feb. 4. Wilcox retired after a 30-year career at the Fed.

Kraninger Building New Team At CFPB

 

	Kathy Kraninger

Consumer Financial Protection Bureau Director Kathy Kraninger continues to put her own stamp on the agency, including a number of new additions to her team. This week, she announced the hiring of Andrew Duke as policy associate director for external affairs. Duke has 27 years of experience in public policy, including 20 years on Capitol Hill. He most was chief of staff to former House Financial Services Committee Chairman Jeb Hensarling. Other new hires include:

• Delicia Reynolds Hand as Deputy Associate Director for External Affairs. She joined the Bureau in 2012 and has 17 years of experience in consumer advocacy, community development, and on Capitol Hill;

• Laura Fiene will serve as West Regional Director. Fiene joined the CFPB at its inception in 2011 and brings more than 31 years of experience in regulating financial services companies, including 27 years dedicated to supervising and examining compliance with federal consumer financial laws and regulations.

• Lora McCray will serve as Director for the Office of Minority and Women Inclusion. McCray's career includes 15 years of experience in diversity practice and management, most recently as the Assistant Vice President, Diversity and Inclusion at the Federal Reserve Bank of Boston.
   
•  Marisol Garibay is Acting Chief Communications Officer. Garibay has 14 years of experience in policy communications focused on financial issues, and served most recently as Senior Advisor and Acting Communications Director at the Office of Management and Budget.
   

 

  ICBA Advocacy Survey - Please Take A Moment To Complete

Advocacy is everyone's responsibility. Whether you're a community bank president, employee, or director, you have a direct stake in making sure lawmakers in Congress hear your voice.  To more effectively advance our collective mission to create and promote an environment where community banks flourish, ICBA and IBANYS need your help. The following survey seeks to refine the tools and resources ICBA can offer you to better enable the important conversations and relationships required to drive positive policy outcomes for the community banking sector. Additionally, ICBA is seeking to build greater visibility of the existing personal or professional relationships that you as a community banker or director may already have with returning or new lawmakers.

 

This survey should take less than 10 minutes to complete. Please contact Ryan Hadley at ryan.hadley@icba.org with any questions regarding this survey. 

Take The Survey

IBANYS congratulates Bob Fisher, Chairman, President & CEO of Tioga State Bank, upon his being nominated as Vice Chairman of the Independent Community Bankers of America (ICBA). A fifth-generation community banker, Bob is a former IBANYS Chairman and current IBANYS board member. He chairs our state political action committee, NYSIBPAC, co-chairs ICBA's federal political action committee, ICBPAC, and ICBA's Policy Development Committee.  Last September, Tioga State Bank received national recognition as one of American Banker magazine's "Best Banks to Work For" and was honored for all that their employees do for their customers and communities. 

Other nominees included Preston Kennedy, President and CEO of Zachary Bancshares Inc. of Zachary, La. as Chairman; Noah W. Wilcox, President, CEO and chairman of Grand Rapids State Bank and its holding company, Wilcox Bancshares Inc. of Grand Rapids, Minn. as Chairman-Elect. ICBA's board of directors will vote on the nominations during the 2019 ICBA national convention, ICBA LIVE®, which will be held March 18-22 in Nashville. 

Vining Sparks & ICBA Securities Balance Sheet Academy

Registration is now open for Vining Sparks and ICBA Securities' Balance Sheet Academy seminar in Memphis, Tennessee from Monday, April 29 to Tuesday, April 30 2019. This  advanced seminar is designed to expose seasoned community bank portfolio and balance sheet managers to advanced products and concepts.  The objective is to enable the attendees to consistently outperform their peers. The dynamics of a community bank balance sheet require an investment professional to be versed in a wide range of topics.  Balance Sheet Academy  provides discussion and practical classroom exercises to equip the attendees for these demands. Examples of these topics include: 

• Advanced interest rate risk management strategies;

• Low cost funding strategies; and

• Strategies for serving bank customers while managing interest rate risk.  

Attendees will learn how the changing economic data impacts market interest rates from Vining Sparks' Chief Economist. The Balance Sheet Academy is structured for more experienced investment managers, particularly those who have attended Bond Academy.  

It incorporates balance sheet strategies into the day-to-day management of an institution's investment portfolio, wholesale funding and interest rate risk management. Bank personnel with an intermediate level of understanding of investments who are integral to the investment and balance sheet management process will benefit the most from this advanced course. New directors serving on the investment or asset-liability committee will also find this course beneficial. 

Learn More Details or How To Register

Contact:

Kert Johnson,  SVP/Marketing at (901) 762-5340 or kjohnson@viningsparks.com.