April 26, 2023

IBANYS Weekly E-Newsletter
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PRESIDENT'S MESSAGE

It's hard to believe we are already in the final week of April. It has been an extremely busy and challenging spring for IBANYS and our members, and it does not appear to be easing up.

 

Community banks in New York State -- and nationally -- face an uphill climb in the aftermath of the failure last month of SVB and Signature Banks. IBANYS and ICBA are working hard to differentiate community banks from larger, riskier financial institutions -- and, to have them excluded from an FDIC special assessment. When the U.S. Treasury Department announced the bailout of the depositors of SVB and Signature on March 12, IBANYS joined with ICBA in emphasizing that community banks should not have to pay a penny to cover the cost of the special assessment

 

It’s important to remember that both IBANYS and ICBA have one mission: To represent and work for community banks. Having an association solely focused on community banks is so critical, at both the state and national levels. New York’s community banks need to know that IBANYS -- and ICBA -- continue to have your back and your best interests at heart. We will always be sure our actions on your behalf stay true to that mission. Here are the latest examples:

 

 

 

Speaking of grass roots efforts, we hope you will consider joining your fellow community bankers and Associate Members, (Luse Gorman and The Bonadio Group) at the ICBA Capital Summit in Washington DC from May14-17 to meet our New York congressional representatives. We need to educate and inform them on issues impacting community banks, and urge them to help our industry and the communities and customers we serve. For more details, please go to www.icba.org.

 

With April nearly over, IBANYS Annual Convention, Community Banks - The Heartbeat of our Communities, is getting closer! The convention will be held June12-14 at The Turning Stone Resort and Casino, just outside of Syracuse, and promises to be a terrific event featuring great speakers on timely topics. Visit  www.ibanys.net  for details and registration forms. (Please also get involved by donating an item to our NYSIBPAC auction on June 13th. Details are in the brochure on page 11.) 

 

IBANYS MEETINGS

REGISTRATION IS OPEN!!!

 

IBANYS' ANNUAL CONVENTION, "The Heartbeat of All Communities" is being held at the Turning Stone Resort and Casino from June 12-14.

 

We have a few exciting days of networking, education and entertainment planned for our participants. The agenda is jam packed with great subject matter experts on a variety of topics that impact community banks today.

 

There are 30 exhibitor spaces available at the Tradeshow (there are only 6 spaces left) and we anticipate that all the booths will be filled. Reserve your booth today, they are sold on a first-come-first serve basis.

 

Jack Hopkins, ICBA Chairman Elect will address the attendees on Monday evening and Gary Hoy, President Appointment University will close out the meeting on Wednesday.

 

Join us Tuesday evening after dinner as Dueling Pianos, “presented by Dueling Pianos International entertains us with a fun, interactive battle of the “ivories”. 

 

PAC Auction - Please consider donating an item for this event, (see page 11) of the enclosed brochure for suggested items. This is an important part of our convention and provides a perfect opportunity to showcase items from your region, while supporting an essential committee that focuses and advocates for community banks in NYS legislative affairs. The PAC auction takes place on Tuesday evening during our cocktail reception which is held on the Trade Show floor. Items are placed in exhibitor booths to be viewed and bid on.

 

This is an outstanding opportunity to get our bankers, preferred partners, associate members and sponsors together. We are excited to share with you, that the response to date, has been fantastic!

 

Attached, is the convention brochure, containing everything you need to know about our signature event of the year including registrations forms, program agenda, hotel booking, and dress attire. PLEASE REGISTER FOR THE ANNUAL CONVENTION BY COMPLETING THE APPROPRIATE REGISTRATION form (Attendee or exhibitor) and email (lindag@ibanys.net) or mail to Linda Gregware, 194 Washington Ave., Suite 420, Albany, NY 12210.

 

Reserve your overnight accommodations today and register as early as possible – the room block is filling up fast!! See page 6 for room block information.

 


June 21st – 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 

CONVENTION SPEAKERS

Gary Hoy, Owner

Appointment University



Gary Hoy started his career in the field of special education. He then started a side business but soon realized he was a “card carrying” business owner, not an active one. Through years of trial and error, Gary developed an amazing ability to “open doors.” He went on to individually counsel hundreds of business owners and many Fortune 100 company sales teams. He authored a book (Call Power) on call reluctance that sold 50,000 copies. His 15-Second Approach is changing how organization on-board new sales people. 

Mike Burke

Senior Robbery and Crisis Management Consultant

SHAZAM



From teaching criminal justice classes, investigating bank robberies and embezzlement as a sergeant detective, and serving as the founding director of the Iowa Central Homeland Security Training Center, Mike Burke is an invaluable resource for organizations looking to improve their understanding and training in robbery and crisis management. His timely, comprehensive and thoughtful presentations regarding robberies, active-shooter scenarios and loss prevention help community institutions enhance their security measures and ensure regulatory compliance. As a member of the Midwest Financial Fraud Investigators, Mike partners with law enforcement and other financial institutions to share information about fraud.

CONVENTION SPONSORS

Breakfast - Tuesday

Breakfast - Wednesday

Program Book

Refreshment Breaks

Credit Card Machine

ASSOCIATE & PREFERRED PARTNERS

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.

InfoAgora is hosting a webinar on:

Integrated Stress Testing: From Credit to Liquidity Risk

May 10 - 9:00 - 10:00 a.m. EST


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

Our latest issue of “The Advisor”, framing our view and outlook for the economy, interest rates, markets, and key financial institution balance sheet management themes, is attached.

 

We present our strategies in Fixed Income, Equities, and ALM to help you navigate in the current environment.

 

This issue focuses on the economy's rising and lowering inflation and interest rate paths leading to a Fed policy reversal, fixed income strategy with tight liquidity and inverted yield curve limiting investing activities, equity strategy discussion of a potential recession's affect on earnings, and ALM strategy of the impact of a changing business climate.


Read here

ICBA INFORMATION
Click here to register

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.

ALBANY UPDATE

Legislative Update

 

  • Here are the latest legislative  introductions  in Albany for the period from April 10 - 21, as well legislative activity from last week and committee agendas for this weekA number of high-profile issues for community banks appear on Chairman Sanders' Senate Banks Committee agenda this week, including bills related to 1) State Public Banking (S.1755A); 2) Municipal Deposits (S.1453); 3) Fees (S. 2601), and 4) Order of Payment for checks, other debts, insufficient funds charges and return deposit item charges (S.5972).  Legislation was also introduced and referred to the Banks Committee related to 1) establishing Banking Development Districts in underbanked communities (S.6270), and 2) regarding minority depository institutions' applications to establish home or branch offices in unbanked or underbanked communities (S.6271).

 

Latest On State Budget Negotiations

 

  • The State Legislature passed its fifth budget extender on Monday to keep state government operating through Friday. Legislators hope to have a final deal on the spending plan by then or soon thereafter, the Post reports. There is some optimism an agreement could be close, as the Governor and leaders try to pass the latest state budget since 2010, when it wasn't approved until August. This year’s budget is more than three weeks late. State Comptroller DiNapoli said a new extender, if necessary, would not need to be passed until Noon on Tuesday. Assembly Speaker Heastie noted a few things still must be worked out, but “hopefully the end is near.” Heastie believes housing talks may well continue post-budget after Governor  Hochul’s ambitious housing compact  failed to win legislative support to include it in the budget. Heastie said the remaining outstanding issues are not necessarily easily resolved, but are being worked out. Heastie said they include “the environment, charter schools,” and how to curb illegal cannabis sales.   

 

 

  • New York's state budget could lead to a minimum wage of up to $17 an hour in the coming years, sources familiar with the discussion said Monday evening.  Read More

 

  • New York governors have a lot of leverage in the state budget talks when the state decides how to spend billions of dollars. Some legislators want to “get the policy out" of future budget negotiations. Read More

 

Political Perspective

 

  • Democrats and Republicans are trying to understand what happened in the 2022 midterm elections, and how to gain an advantage in 2024. New York State could determine whether the GOP maintains its control of the U.S. House of Representatives or Democrats reclaim the majority. Both political parties see opportunity in the same places that delivered surprising results a year ago. Politico New York reports.  Meanwhile, the well-regarded Cook Political Report looks at 2024 House election ratings, and lists a number of New York districts.

 

WASHINGTON UPDATE

Grassroots Efforts

 

  • Community banking advocacy is extremely important amid the ongoing policy response to the recent failures of Silicon Valley Bank and Signature Bank of New York. The  ICBA Capital Summit   May 14 - 17 in Washington, D.C. will bring together community bankers from across the country to advocate for our industry in person in congressional meetings. The event will also feature meetings with policymakers, remarks from Senate Banking Committee Chairman Sherrod Brown (D-OH) and House Subcommittee on Financial Institutions Chairman Andy Barr (R-KY.), and more. IBANYS will be scheduling meetings with key members of our New York congressional delegation. Please consider joining us in Washington to make your voice heard!

 

  • Community banks face a major challenge in the aftermath of the SVB and Signature bank failures in March. It's essential that we differentiate community banks from larger, riskier financial institutions -- and, to have them excluded from an FDIC special assessment. Both ICBA and IBANYS have written to the FDIC to make our position clear -- and, urge New York community banks to send their own letters, and share them with your local congressional Representatives and Senators Schumer and Gillibrand as well. Here is a copy of the letter that IBANYS sent to FDIC Director Gruenberg and others. . .and, here is the ICBA's letter

 

  • ICBA has said since the immediate aftermath of the failures that Washington’s response should not affect community banks, and is calling on policymakers to ensure the review doesn’t simply pave the way to additional regulation. It also is cautioning that while the pending regulatory reports are important, agency reviews of their own oversight might not provide a sufficient picture of supervisory missteps. In a recent blog post and video to community bankers, ICBA President and CEO Rebeca Romero Rainey said round-the-clock media outreach, the ICBA National Campaign, and focused advocacy efforts are helping to differentiate community banks from larger financial institutions among policymakers and the public.


  • With House members considering a resolution to nullify the 1071 rule, ICBA continues calling on community bankers to urge their members of Congress to support the measure. Community bankers can use ICBA’s Be Heard grassroots action center to urge lawmakers to pass H.J.Res.50, which would provide for congressional disapproval of the 1071 rule and dictate that it has no force or effect. ICBA recently published a summary of the rule that details its scope of coverage, key definitions, compliance dates, collection and reporting procedures, and more.

 

Regulatory Update

 

  • The Federal Reserve Board  said  it will release its review of the supervision and regulation of Silicon Valley Bank at 11 a.m. (Eastern time) this Friday. Fed Vice Chair for Supervision Michael Barr, who is leading the review, last month told Congress that the agency’s analysis of whether to enact stricter capital standards for regional banks over $100 billion—which is part of its review of the SVB failure—does not apply to community banks. During the March 29 House Financial Services Committee hearing, Barr said the community banking system is “well-capitalized and stable and serving its communities.” The FDIC is scheduled to release separate reports on the deposit insurance system and on the agency’s supervision of Signature Bank of New York by Monday, May 1.The Signature review is reportedly set to be released this Friday.


  • ICBA called on the CFPB to exempt community banks with an “outstanding” or “satisfactory” Community Reinvestment Act rating from compliance with its Section 1071 rule. ICBA said subjecting small and intermediate banks, as defined under CRA regulations, is unreasonable because exempting these institutions would not meaningfully impair the bureau’s ability to collect small-business lending data. ICBA noted that mandating compliance from banks that make 100-500 small-business loans per year would result in data collection on only 4-5% of small-business loan applications to banks, according to CFPB estimates.


  • Federal banking regulators issued revisions to the  Interagency Policy Statement on Allowances for Credit Losses  in response to changes in accounting guidance for troubled debt restructurings.  Community banks must now assess modified loans for impairment under U.S. generally accepted accounting principles using CECL along with all other held-for-investment loans. ICBA reminds community banks that they must evaluate investment securities held-to-maturity and available-for-sale for impairment under CECL in addition to their loans held-for-investment.

 

  • ICBA applauded the Financial Stability Oversight Council’s (FSOC) unanimous votes to propose new interpretive guidance on nonbank financial company designations and an analytic framework for identifying potential risks to financial stability from certain activities. “Large nonbank financial institutions that pose outsized risks to the financial system similar to those posed by large banks should be required to meet similar capital and liquidity standards,” ICBA President and CEO Rebeca Romero Rainey said. “We support the publication of new guidance that will level the playing field, address risks to financial stability, and provide transparency to the public.” FSOC advanced: 1) Proposed interpretative guidance on its procedures for designating nonbank financial companies for Federal Reserve supervision and enhanced prudential standards. 2) A proposed analytic framework for how the council identifies, assesses, and addresses potential risks to financial stability from activities or firms. . .ICBA has consistently supported enhanced capital, leverage, and liquidity standards for the largest financial institutions. For instance, a January letter from ICBA urged federal regulators to apply stricter regulatory standards on large regional banks to avoid government bailouts in the event of financial instability.

 

Legislative Activity

 

  • ICBA expressed support for legislation to give mortgage applicants more control over their private financial information. Introduced by Rep. Ritchie Torres (D-Bronx), the “Trigger Leads Abatement Act of 2023” (H.R. 2656) would amend the Fair Credit Reporting Act to prohibit credit reporting agencies from selling “trigger leads” when a consumer applies for a residential mortgage unless the consumer has opted into the creation and sale of such leads. In a letter to Torres, ICBA said consumers are inundated with unwanted and invasive solicitations after they apply for a mortgage, yet the current process for consumers to opt out is confusing and leads many to believe their accounts have been hacked. Mortgage applications should not be public information, ICBA said.

 

Industry Insights

 

  • Banks with more than $100 billion of assets expect tougher regulations in the wake of last month's bank failures. They say that any changes to capital and liquidity standards should happen gradually in order to avoid spooking investors. Read story.