IBANYS Weekly E-Newsletter |
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Visit our website at www.ibanys.net to review all our daily updates on COVID-19 beginning on March 16.
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The President's Message:
IBANYS News and Updates
By John Witkowski, President & CEO
As Congress gets back to work this week, we can only hope their focus remains firmly on small businesses and their employees whose fates hang in the balance of the ongoing COVID-19 pandemic. The overly complicated process that the SBA has outlined for PPP forgiveness has many small businesses wondering what to do next. Members of both political parties have expressed support for simplifying PPP forgiveness for loans under $150,000 so borrowers can focus on the survival of their businesses.
The Independent Bankers Association of New York State (IBANYS) stands united with the Independent Community Bankers of America and community banking associations across the country in calling for the Congress to take swift, meaningful and bi-partisan action to get small businesses back to work without the cloud of PPP forgiveness hanging over them.
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There are only three weeks until IBANYS' first-ever all virtual convention "Virtually Un-Conventional" September 30 - October 2. In the midst of the changes caused by the pandemic, this offers us a way to provide important and timely educational programming to New York community bankers -- as we have traditionally done over the years through our in-person programs. Please take a moment to read updates in today's newsletter on topics, speakers, sponsorship opportunities and the opportunity for banks to make the virtual convention available to all bank employees. It's our way of continuing to provide the important information your banks need. The detailed meeting agenda and registration information is attached in the convention section of this newsletter.
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The second-quarter FDIC Quarterly Banking Profile numbers outline a story of community bank resilience and commitment, ICBA's writes in Main Street Matters. ICBA's assistant vice president of economic policy and research noted that community banks have demonstrated strength through Paycheck Protection Program lending, increases in net income, modest declines in net interest margins, and record growth in net loans and leases. "Therefore, the second-quarter statistics are not just evidence of community banks’ resilience in times of economic hardship, but an attestation to the resilience of their commitment to Main Street as a guarantor of essential financial services," he writes. Read the post.
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The FDIC issued its state profiles for the second quarter of 2020. FDIC State Profiles is a quarterly summary of banking and economic conditions in each state. To read the profile of New York, click here or here https://www.fdic.gov/bank/analytical/stateprofile/newyork/ny.pdf
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The FDIC's Quarterly Banking Profile reported that overall, community bank net income increased 3.2 percent in the second quarter from the same time last year. That contrasts with the overall banking industry's 70 percent decline in net income, due to the economic impact of the coronavirus pandemic. More than half of community banks reported higher net income despite a 273.2% increase in provision expenses. The increase was driven by gains on the sale of loans (up 142.2%) and securities (up 130.7%). Community banks reported year-over-year loan growth of 13.5%, driven by Paycheck Protection Program lending. The net interest margin for community banks decreased 17 basis points year-over-year to 3.51%, as the decline in average earning asset yields outpaced the decline in funding costs.
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Meanwhile, Credit union net income declined 34.6 percent in the second quarter from the same time last year, according to the National Credit Union Administration. The net interest margin for federally insured credit unions was 2.88 percent of average assets, down from 3.18 percent a year ago. The return on average assets declined from 97 basis points to 57 basis points.
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IBANYS VIRTUAL CONVENTION |
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September 30 - October 1-2, 2020
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NEW INFORMATION: IBANYS is adapting to the new normal brought about by the pandemic including switching our 2020 Annual Convention to a “Virtual” Convention this fall. The 2020 IBANYS “Virtual” Annual Convention will take place starting Wednesday, September 30 – Friday, October 2, 2020. Banks can register for one price, and the event will be open for all bank employees. Employees may attend all or just some of the sessions. CPE credits will be awarded. Each week we will feature our speakers who will share their knowledge and expertise during this event. The detailed agenda and registration information click here for details & registration. We hope you and your team will be a part of the this year's event.
We would like to thank our all of our generous sponsors of this event and their continued support of IBANYS and all community banks. Please take a moment to click on the company logo below to learn more about each sponsor and how they help the community banks.
If you would like to be a sponsor, please contact me at johnw@ibanys.net or 518-436-4646 for details.
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Jamie Card, Partner & Financial Institutions Team Leader,The Bonadio Group read bio here
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Marc Valerio, Partner, The Bonadio Group
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PPP Update
This session will provide current updates on PPP in regards to laws, rules, and proposed changes. In addition to leading a discussion focused on the accounting for PPP and the related fees.
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Adapting the Banking Experience in a Changing World
The COVID-19 crisis has rapidly changed consumer behaviors and accelerated the adoption of new banking technologies. Even before the pandemic, recent innovation and evolving competition began to fuel the fastest pace of change in the history of banking, providing both new options for consumers and new opportunities for companies. FinTechs, the Big Techs, and the big banks are all adapting to trends at different speeds. The question becomes, how can you also leverage changing consumer habits to enhance your customer experience and your customer relationships? Join us to discuss key developments in the FinTech landscape, with a focus on the user experience in an increasingly digital world.
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Stop the Rollercoaster: How to Invest in Digital AND Branch Experiences to Appeal to Multiple Generations
Contrary to much of the media coverage and hype, you do not need to choose between your channels, picking one and forsaking the rest. During this presentation, La Macchia Group will discuss how data can empower each of your channels for success and how branding can unite them for a seamless customer experience.
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Our Convention Sponsors
Click each company to learn how they can help your bank.
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IBANYS Webinars
Are you participating in IBANYS webinars? Now is the time! IBANYS webinars provide timely, important information on subjects of interest to New York community bankers including human resources, business development, investment, compliance and security and much more. They are valuable not only for their content, but for their convenience and low-cost. Take part from the comfort and privacy of your office, without leaving the bank.
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Subscription Tokens
The More You Buy, The More You Save
How does it work:
Tokens can be used to purchase live or recorded webinars anytime, with no expiration! Tokens for both live and recorded webinars are available for an additional fee. (What’s the difference? Click here for the full description.)
Once you have your Subscription Token code, you can immediately register for webinars by using the code at checkout! (Subscription tokens not applicable for full series registrations, or other specials.)
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IBANYS Preferred Partners & Associate Members |
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The ICBA Federal Delegate Board (FDB) election process began this week when nominating petition letters were emailed to all ICBA member banks in New York. To qualify to become a delegate, nominees must be Executive Officers (as defined by Reg O) of a financial institution that has been a paid active ICBA member bank for at least 3 years and must have been active with ICBA or the state association by previously serving on a committee, council or task force. Bankers can nominate themselves and will need three ICBA member bankers to support his or her candidacy for their petition to be considered valid and complete. IBANYS Chairman, Michael Wimer, is finishing up the final year of his second three-year term and cannot run again. We thank Mike for his outstanding service on behalf of New York community banks.
Election Process and Schedule
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September 1 - Election process begins when self-nominating forms for state delegate on the Federal Delegate Board are sent to ICBA member banks in the state.
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September 21 – Completed nomination forms must be returned by candidates along with the signatures of three ICBA member bankers supporting the candidacy.
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October 1 - Election ballots are sent to member banks. (In the event that only one name is submitted, they will automatically become the new state delegate and no ballot will be necessary.)
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October 15 – Votes must be received by ICBA.
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The NextGen Scholarship is Back!
The LEAD FWD Summit is Sept. 21-22 and offered in virtual format
Due to the success of last year's NextGen scholarship program, we are excited to announce that ICBA is once again offering this exciting scholarship opportunity for our state association friends.
With the ICBA 2020 NextGen Scholarship you have an opportunity to award one community banker from your membership a fully-paid scholarship to ICBA's virtual leadership conference, the 2020 LEAD FWD Summit (Sept. 21-22).
This is your scholarship to award to a deserving community banker in your state! We’re thrilled to assist you in further engaging the future of our industry and we’re delighted to partner on this NextGen Scholarship opportunity. For more details, including how to participate, please refer to this informational brief and our ICBA State and Regional Partner web page where you will find customizable promotional tools and assets.
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ICBA Securities and its exclusively endorsed broker/dealer, Vining Sparks, will present a webinar on September 15th exclusively for the state associations that endorse ICBA Securities, as well as all other community banks. This is the 7th webinar of the 2020 webinar series.
The municipal bond sector continues to occupy a significant portion of community bank portfolios and year after year serves as one of the better performing asset classes. Significant weightings in tax-free bonds can produce high tax-equivalent yields.
In this webinar, we will provide insights on how COVID-19 and related federal programs have impacted municipal credit and how community bankers can assess investments in this new context. We will also comment on current municipal market conditions and opportunities with an emphasis on community bank portfolios. Lastly, we will provide commentary on the outlooks of the State and Local Governments Sectors.
What you’ll learn:
• The role municipal bonds play in a high performing bank investment portfolio
• The current state of the market for tax-free and taxable municipals
• COVID-19 impact on municipal credit and a 2020 outlook for state and local governments.
The webinar will last approximately 1 hour.
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New York's fiscal options, facing a downturn in the economy amid the coronavirus pandemic. Governor Cuomo yesterday continued to hold out hope for some form of federal aid. While he has resisted calls to tax New York’s high income earners, he now appears for the first time to have opened the door to the idea that taxing the rich could be part of the solution to the state’s economic crisis, indicating it could be part of the solution to the state’s economic woes. State legislators still plan to hold a session this fall that would likely address the state's finances. The economic shutdown triggered by the COVID-19 pandemic has resulted in a $14 billion state budget deficit, with projections of up to $30 billion by 2022, according to Governor Cuomo. Among the revenue-raisers being discussed are: Eliminating the rebates the state currently provides on stock transfers; Enacting higher income taxes on those with more than $1 million in annual income, and creating a new tax on super wealthy people with more than $1 billion in assets. (However, the Governor this week doubled down on his claim that increasing taxes on the wealthy could not do anything significant to resolve the fiscal situation.) Some legislators have also urged Congress to find a funding solution for New York's schools, as the state withholds 20% in funding amid the recession created by the coronavirus pandemic. Legislators have also turned to the New York City real estate market for relief by reviving talk of the “pied-à-terre” property tax surcharge on qualifying non-primary residences within the state. https://www.natlawreview.com/article/covid-19-real-estate-revival-new-york-pied-terre-tax; Please click here to access the full text of the proposed Senate Bill S44A.
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DFS FAQ On Forbearance For Residential Mortgages Held In Portfolio By NYS Chartered Banks The NYS Department of Financial Services (DFS) has issued the "Frequently Asked Questions (FAQ) document on the state's new Residential Mortgage Forbearance Law on forbearance for residential mortgages held in portfolio by NYS chartered banks. IBANYS would like to thank the DFS team for providing guidance through this document, which IBANYS had suggested. The FAQ document may be accessed through the link below: https://ibanys.net/wp-content/uploads/2020/07/FAQ-on-Mortgage-Forbearance-Bill-7.22.20-Dist-update-2.pdf
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- The Senate is back in session, and the full House will formally return next week. However, the House Financial Services Committee has hearings scheduled on minority and women inclusion) and on financial aid for states and territories. The House Small Business Committee has a hearing Wednesday on transparency in small-business lending. The Senate Banking Committee is scheduled to meet today on the Federal Reserve's emergency lending facilities.
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The session continues with no signs of progress on a new coronavirus relief package. Despite weeks of talks, a bipartisan compromise seems unlikely before the election. U.S. Senate Majority Leader Mitch McConnell said the Senate would vote on the trimmed-down Republican coronavirus relief package, though it has a slim chance of passage in the face of Democrats’ insistence for more sweeping aid. The measure carries a price tag of around $500 billion, includes $300 per week in extra unemployment insurance, liability protections for employers that reopen during the pandemic, and a two-year tax credit for school choice, among other things. Senate Minority Leader Schumer and his conference remain opposed to and, with House Speaker Pelosi, are urging at least $2 trillion in new spending.
- Speaker Pelosi (D-Calif.) and Treasury Secretary Mnuchin have agreed to discuss a short-term spending bill to avoid a government shutdown when current funding expires on Oct. 1. Mnuchin has said it would be separate from a coronavirus pandemic spending package. Senate Majority Leader Mitch McConnell (R-Ky.) said late last week he "can't promise one final package."
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IBANYS Urges New York Congressional Delegation To Support PPP Changes. As the stalemate between Congress and the Trump administration regarding the next coronavirus legislative package continues, IBANYS has written to the New York Congressional Delegation (and shared the letter with members of the NYS Legislature as an FYI) urging support of a number of important changes ICBA has suggested be made to the Paycheck Protection Program. Read IBANYS' letter to Congress. Read IBANYS letter
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ICBA continues urging community bankers to call on policymakers to overturn Fannie Mae and Freddie Mac's decision to charge a 0.5 percent fee on refinance mortgages. Community bankers can use ICBA's Be Heard grassroots action center to tell Congress to insist that the enterprises and the Federal Housing Finance Agency reverse the policy, which would cost the average homeowner $1,400 amid the COVID-19 pandemic. In American Banker, ICBA's Ron Haynie wrote that the new “adverse market" fee comes at a significant cost to homeowners at precisely the wrong time. "For many Americans, $1,400 means a lot," he wrote. Haynie also discussed the fee hike in a separate American Banker report, noting that it will lead to slightly higher interest rates for borrowers that will noticeably increase payments.
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ICBA Seeking ILC Grassroots Outreach ICBA continues calling on community bankers to urge their senators to co-sponsor legislation to close the industrial loan company loophole. The customizable message on ICBA's Be Heard grassroots action center notes that ILCs pose a significant risk to the financial system and should be regulated like other banking institutions. The Eliminating Corporate Shadow Banking Act (S. 2839) would subject ILCs to the Bank Holding Company Act. ICBA recently called on the FDIC to deny Rakuten Bank America’s resubmitted ILC application and urged the agency to strengthen its proposal to enhance oversight of ILC parent companies.
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