Hope everyone had a nice holiday weekend. Along with trying to understand the reason behind some of the legislation that is being presented (and some passed) at the state and federal level, IBANYS is working hard at defining the difference between large banks and community banks with our representatives. Community banks work have always worked closely with their hometown consumers and small businesses. Along with ICBA, we will continue to oppose legislation that requires additional scrutiny on community banks. Please read the Albany and Washington DC sections below for more information.

Public State Bank: In a few weeks, IBANYS will participate in a roundtable discussion with the members of the state senate and assembly. While we have our solid reasons for not allowing a Public State Bank, your comments would be appreciated as we prepare for this discussion.

Capital Summit in Washington DC – May 14-17: Please sign up for the ICBA’s Capital Summit in Washington DC. We need your voice in DC to speak to our representatives. We are looking to have between 10-13 meetings in DC and need as many bank executives as possible to join us for these visits. Please see the details and registration link in the section below.

IBANYS Annual Convention – June 12-14 at The Turning Stone Resort and Casino: 

This will be another great event for our banks with many top speakers, entertainment, networking opportunities with peers, preferred partners and associate members.

There are still a few opportunities for:



• Sponsorships and Exhibitors Information
• Donations for the NYSIBPAC Auction on June 13th

NOTE: Please make your hotel reservations soon because the block price ends in Mid-May. See information below for room block.

Here are other upcoming events IBANYS is hosting: 

May 10^th – InfoAgora is hosting a webinar on:

Integrated Stress Testing: From Credit to Liquidity Risk - May 10th

The recent bank failures have highlighted flaws in the typical risk management approach that banks should mobilize to address. One of such flaws is the lack of integrated stress testing. Although banks in general conduct interest rate, credit, market and liquidity stress testing for regulatory compliance, they do so separately within each risk silo and they therefore do not take into account ripple effects across risk types. Click here to register

June 21^st – Jack Hubbard on Building and Strengthening Relationships - Turning Stone Resort and Casino: Hear from Jack on his years of experience (over 50) in banking and how his tactics survive in the world of social media and innovative technology. It will be a great day to hear from one of the leading subject matter experts in banking. Click here for registration information

Check our website for any additional updates. www.ibanys.net

Regards,

John

IBANYS MEETINGS

CONVENTION SPEAKERS

Michael Jamesson, Principal

Jamesson Associates

Michael Jamesson has close to fifty years of experience in banking and related fields. His experience spans the full range of banking institutions from community, thrift, and metropolitan regional banks to regional and super-regional bank holding companies. Since founding his consulting firm, Jamesson Associates, in 1991, he has concentrated his efforts on helping institutions navigate the vagaries of interest rates, the economy, and the changing fortunes of the financial services industry. His field of expertise includes Asset/Liability Management, Strategic Plan development, and capital markets advisory services. You can follow his thoughts by reading his quarterly newsletter, available free on his website www.JamessonAssociates.com.

James Reber, President & CEO

ICBA Securities

Jim Reber is president and CEO of ICBA Securities® part of the ICBA Services Network® and a wholly owned subsidiary of the Independent Community Bankers of America®. Reber joined the company in 1990 and was elected president and CEO in 2005.

Prior to joining ICBA Securities, Reber was senior vice president and investment strategist of Vining Sparks IBG, a leading broker-dealer for institutional investors Reber also served as vice president of Union Planters Bank in Memphis.

With over 35 years of experience, Reber is a frequent speaker at bank conventions, seminars and conferences. He also writes a monthly investment column for the award-winning national magazine, Independent Banker®.

Reber is a certified public accountant and a chartered financial analyst. He is on the board of regents of the Paul W. Barret School of Banking and served as its chairman in 2017. Reber received a BS in accounting Magna Cum Laude from Christian Brothers University and served on the Board of Trustees as Chairman of the Finance Committee and University Treasurer.

Managing Director, Payment Strategy

Strategic Resource Management (SRM)

Keith has 25 years of payments expertise across issuer, network, and processor roles. He began his career with Household Bank, supporting the launch and growth effort of the GM cobrand through Household Credit Services. He later joined First Data/Concord EFS as the SVP of Operations and Implementations for their Northeast Platform.

Keith then worked for MasterCard for 14 years, where he gained extensive experience in roles ranging from Account Management to Sales, supporting regulated and unregulated issuers. His last position at MasterCard was the lead for the New Business team for Community Financial Institutions.

CONVENTION SPONSORS

BHG Financial  

Vendor Reception (Mon)

Federal Home Loan Bank of NY

Welcome Dinner (Mon)

ICBA & ICBA Securities

Trade Show Floor

Compass IT Compliance

Dueling Pianos Show (Tues)

Harris Beach PLLC

Dinner (Tues)

 Webinar to promote to your members – Section 1071 Compliance: What Does the Final Rule Mean for Small Business Lenders Like You?

Date/Time: Thursday, April 20, 2023 at 1pm CST

Speakers: Alesha Briley, Monica Bolin, and Stephanie Lyon

Description:

The CFPB has finally released its final rule implementing Section 1071 of the Dodd-Frank Act. What do small business lenders need to do to comply? Our regulatory compliance experts have gone through all 800+ pages and are ready to break it down for you.

In this webinar, we’ll explain:

• Which lenders must comply with 1071
• Definition of a small business under 1071
• Data fields and deadlines
• What you need to do to comply
• Best practices for implementation

Whether you're a commercial lender, compliance professional, or member of the C-suite, this webinar will help you understand what the Section 1071 final rule means for your team and how to move forward with confidence. Link to register: https://hubs.ly/Q01JHDZd0

CECL Coffee Talk Q&A

Friday, April 21 at 10:00 am ET 

The CECL deadline is here. How’s your first Call Report with CECL-driven reserves coming along Join QwickRate’s interactive CECL discussion series where they address the latest questions and concerns they have received from banks — including the reactions and expectations they are hearing from auditors and examiners. Bring your questions!  REGISTER HERE.

Join Wolf & Company and Shield Compliance for an Executive Forum on Cannabis Banking in New York City on May 4, 2023. This one-day event is for executive leaders at financial institutions in the Northeast who are either considering or currently developing a cannabis banking program. Industry experts will cover regulatory requirements, legal considerations, compliance and risk management, financial modeling, lending, and cannabis banking best practices. Association members receive a $100 discount by using promo code IBANYS at registration.

Recent Trends in U.S. Banks Balance Sheets

Grigoris Karakoulas

April 10, 2023

As US banks earnings season for Q1 2023 kicks off on Friday April 14, we look at trends in banks’ balance sheets. In light of the recent bank crisis, we distinguish between Large (top 25) and Small domestically chartered commercial banks. Read here

Jay Hack Discusses the Impact and Exposures Related to Recent Bank Closures

BY JAY L. HACK, PARTNER

What must banks know about the financial issues of the day, most recently the failures of Silicon Valley Bank, Signature Bank, and related issues regarding FDIC insurance and the protections of deposits?

Jay Hack, a partner in Gallet Dreyer & Berkey’s Financial Institutions Group, the former chair of the New York State Bar Associations Business Law Section, and a current member of its Banking Law Section, has spent his entire career preparing for this exact moment.

What really happened that caused these banks to be shut down by their state regulators? Catch Jays review of the issues surrounding this rapidly evolving series of events, including...

Watch the Video

ICBA’s 2023 Capital Summit in Washington, D.C. will feature remarks by OCC Comptroller Hsu, FDIC Director Gruenberg, CFPB Director Chopra, Treasury Assistant Secretary/Financial Institutions Steele, senior representatives from the Fed, and Senate Banking Committee member Rounds (R-SD). . . Register here.  NOTE: IBANYS will coordinate meetings "on the hill" with members of the New York congressional delegation. We have New Yorkers on a number of key House committees, as well as

9 new members of the delegation since we gathered last spring. Watch for more details.

Legislative Update

•  Here are the latest legislative introductions in Albany from March 31-April 7.  There was no bill activity last week, and there are  no committee meetings scheduled for this week. Note: These legislative updates are also posted weekly on IBANYS’  website at  www.ibanys.net  under the Advocacy/Legislative Update tabs.

•  State Senate Banks Committee Chairman James Sanders (D-Queens) discussed  the  state’s takeover of a New York-charter bank and “financial tumult” in an interview on “Capitol Pressroom.” Sanders spoke about how this intervention could have been prevented and discusses the possibility of public banks for municipalities.

• State Assembly Banks Chair Pamela Hunter (D-Syracuse) recently highlighted her bill “to protect consumers from excessive or unexpected overdraft fees for paperless transactions.” It has passed the Assembly, and Hunter urged the Senate and Governor to support it: “Protections against excessive overdrafts for check payments already exist. . .these same protections do not exist for paperless transactions, which are much more common today.” The bill would require the DFS to establish the same protections for the paperless transactions and develop rules on “how the charges are imposed on consumers whose accounts are overdrawn and how account owners are informed and notified about overdraft processes.”  https://dingo.telicon.com/NY/library/2023/2023032932.PDF

• Supporters of increasing taxes on upper-income New Yorkers are continuing to push for the income tax hike as the state budget talks drag nearly two weeks past the April 1 deadline.  Read More

Budget Update

• New York State was supposed to have a budget in place by the April 1 “deadline” but Gov. Hochul made clear she was willing to ignore that deadline to hold out for her major priorities. It may have increased her leverage in negotiations, but  left her vulnerable to the criticism that a late budget is a symbol of government dysfunction, Gothamist reports.  

• As budget negotiations continued, State Senate Majority Leader Andrea Stewart-Cousins discussed the status of final state budget: "I don't want to depress you... I would like to say we're at the end of the middle. We're close to the end of the middle."  via City Limits.  Hochul and the Legislature have already passed two extenders (the latest expires on Monday)  and it appears a third extender may be necessary when rank and final legislators  return to Albany next week.  Read More.  “Crain’s New York Business” offers  A look at the budget proposals that have the potential to “transform” the state, including housing, MTA Funding, bail reform, minimum wage and taxes. The Governor's proposed statewide plan to expand housing in New York State through “a combination of carrots and sticks” has not been have not embraced by legislators. 

Political Perspective

• The New York Fed’s March Survey of Consumer Expectations found that the share of households saying credit is harder to get versus a year ago rose to the highest level since the survey began 2014. The report also said, “respondents were more pessimistic about future credit availability as well, with the share of households expecting it will be harder to obtain credit a year from now also rising. https://www.reuters.com/markets/us/ny-fed-survey-finds-americans-more-downbeat-credit-access-2023-04-10/?mkt_tok=ODUwLVRBQS01MTEAAAGLDzRjbIfXi6Y1oEDG-WpoggaY0a2F4JM9l9ORw_RgQ9-h-p_CbZKjRveKYguT3nbBUBjJzQKEj16eILBaf49nEbk9qtHbCYjPIyiU2tBEgFxV

ICBA Updates & Actions

• ICBA is hosting a briefing to provide an overview of the Consumer Financial Protection Bureau’s newly released Section 1071 final rule this Friday, April 14 at 12 Noon. The 60-minute webinar will cover key aspects of the new small-business data collection and reporting requirements, including deadlines, definitions, data points, and ongoing ICBA advocacy to mitigate the rule’s impact on community banks. CFPB launched the SBL Help technical support program to help financial institutions implement and comply with the 1071 rule, and posted an implementation webpage and lending data webpage with regulatory and technical resources.  ICBA’s  national news release said the final rule dramatically exceeds the letter of the law and is not appropriately tailored.

• ICBA thanked House Subcommittee on Financial Institutions Chairman Barr (R-KY.) for introducing legislation to incentivize lending in economically distressed communities. “The Opportunity Zones Enhancement Act of 2023” would provide that interest earned on loans to qualified opportunity zone businesses is not included in taxable income. ICBA’s  letter to Barr  said this interest exemption would reduce borrowing costs, build on Tax Cuts and Jobs Act incentives for equity investment in Opportunity Zones, and help community banks meet CRA obligations.  Barr and Senate Banking Committee Chairman Brown (D-Ohio) will speak at the 2023 ICBA Capital Summit  May 14-17 in Washington, D.C.

• ICBA is asking community bankers to urge their members of Congress  to include six key principles in this year’s farm bill.  Community bankers can use ICBA’s  Be Heard grassroots action center to contact their lawmakers on ICBA principles such as providing ample funding, maintaining a strong crop insurance program, and enhancing USDA guaranteed loan programs.  ICBA laid out its six principles in  letters  to the House and Senate agriculture committees earlier this year.

• In a recent blog post and video to community bankers, ICBA President & CEO Rebeca Romero Rainey said ICBA’s round-the-clock media outreach, the ICBA National Campaign, and focused advocacy efforts are helping to distinguish community banks among policymakers and the public. Community banks can use ICBA’s customizable op-ed to differentiate their institutions from larger and riskier entities following the failures of Silicon Valley Bank and Signature Bank of New York. The custom op-ed is available on ICBA’s “Tell Your Story” Toolkit.

• ICBA supports a new FDIC  proposal to update signage requirements  across all banking channels to clearly distinguish insured deposits from noninsured deposits and combat misleading statements to customers regarding the safety of their deposits.  ICBA’s comment letter commended the FDIC for including the use of electronic media when displaying required signage in banking locations, including non-traditional deposit taking locations, and also urged continued monitoring of non-deposit products, particularly as those offerings involve cryptocurrencies and tokenized assets that reside on blockchains. The letter stated: “As tokenization increases in popularity, the risk of a traded asset being confused with a bank deposit will increase as bank customers navigate complex product offerings that blur the lines between guaranteed bank deposits and non-bank deposit products.”  ICBA also clarified that banks that enter into partnerships with third parties should not be liable for the actions of other entities that don’t directly impact the bank, citing compliance costs. 

Federal Regulatory Update

• In wide-ranging remarks on the recent banking crisis, CFPB Director Chopra said other regulators aren't using enough of their powers to supervise banks. Read story

• Treasury Secretary Janet Yellen said the U.S. banking system remains sound, with strong capital and liquidity positions, and said she has been in close contact with her counterparts internationally amid recent banking system pressures and that the global financial system remains resilient due to reforms  following the financial crisis.

• The Treasury Department announced its Community Development Financial Institutions Fund awarded more than $1.73 billion in grants to 603 CDFIs. The CDFI Equitable Recovery Program is designed to provide funding to CDFIs to expand lending, grant making, and investment activities in low- and moderate-income communities to support communities rebounding from the COVID-19 pandemic. The funds are not loans, do not need to be paid back and will be directed to institutions that primarily serve minority communities.  The Hill

• Three Regional Federal Reserve Bank Presidents – all FOMC voting members -- differed on whether more interest rate hikes were needed. Chicago Fed President Austan Goolsbe urged "prudence and patience" and suggested the Fed may need to hold off on another rate hike until it can assess possible economic repercussions. However, New York Fed President John Williams and Minneapolis Fed President Neel Kashkari believe there was more work to do by officials to stem rising inflation.  Bloomberg.  Williams isn't t worried investors in interest-rate futures are betting on a sharp cut in the Fed's benchmark interest rate, saying investors may be anticipating a more severe economic slowdown than Fed officials are, or may be more optimistic about how fast inflation can reach the Fed's 2% target rate. The Wall Street Journal

• The OCC announced  the appointment of four new members of its Minority Depository Institutions Advisory Committee (MDIAC) that meets this month. The MDIAC advises the OCC on how it can ensure the continued health and viability of minority depository institutions. Newly named community bankers include two New Yorkers: ICBA Minority Bank Advisory Council Chairman (and IBANYS board member) Carlos Naudon of Ponce Bank in Bronx, N.Y. and Michael Pugh of Carver Bank in New York.

Industry Insights

• Despite growing concerns about fraud, bankers and credit union lenders say PPP provided a crucial source of capital, backstopping the economy as it faced an unprecedented challenge from the pandemic. Read story

• According to Reuters, the FDIC is expected to propose next month how to make the U.S. banking sector pay for an estimated $23 billion hole in its insurance fund by the collapse of SVB and Signature Bank. The FDIC has broad authority in setting the terms of a "special assessment" to fill the gap. It remains uncertain what this may look like. Regulators reportedly are likely not to make smaller banks pay for last month's failures, reflecting a change Congress and the FDIC made after the 2008 financial crisis to make larger, riskier banks contribute proportionately more to maintaining the Deposit Insurance Fund (DIF). https://www.reuters.com/markets/us/fdics-special-fee-make-banks-pay-svb-cleanup-2023-04-12/

• The New York Department of Financial Services is “poised to set the benchmark for crypto firms in the U.S. and worldwide with its licensing regime.”  Superintendent Harris has expanded on the regulator's unique oversight over digital assets since assuming her position. Harris noted DFS is effectively "the only prudential regulator [with] virtual asset specific-authority in the country."  https://www.axios.com/2023/04/06/crypto-nydfs-harris-bitlicense