• In less than two weeks (Tuesday February 7) IBANYS' hosts our 2023 Virtual Regulatory Compliance Update, and we hope you will join us. Speakers will include representatives from the OCC, FDIC and DFS, who will provide federal and state regulatory perspective on what to expect in 2023. We will also have subject matter experts from UHY, Plante Moran & The Bonadio Group, who will share their knowledge and expertise and provide additional valuable material for New York community bankers. Please note: Registrants can earn up to 6 CPE credits. The detailed agenda and registration information is under the IBANYS meetings section in today's newsletter.

• Each week IBANYS posts on our website NYS legislative updates. Please click here to see a list of active banking bills. This information is updated on our website each week. https://ibanys.net/legislative-updates/ If you have any questions or comments on any of the legislative bills, please contact us 518.436.4646 or johnw@ibanys.net.

• A Reminder: Nominations for ICBA Independent Banker’s 2023  “40 Under 40: Community Bank Leaders” awards are due next week. The awards recognize community banking’s brightest and most promising young professionals, with winners to be featured in the June issue of IB.  Nomination surveys  are due by Tuesday, Jan. 31.

• ICBA announced nominees to serve on its 2023-24 board of directors, to be elected during ICBA LIVE 2023, scheduled for March 12-16 in Honolulu, Hawaii. The nominees include two New Yorkers: Bob Fisher (Tioga State Bank in Spencer, N.Y.) for Past Chairman - - Bob is a former Chair of both ICBA and IBANYS, and a current IBANYS board member --  and Jill Sung (Abacus Federal Savings Bank in New York, N.Y.) as an At-Large Director (Jill is a member of IBANYS' Government Relations Committee.) Congratulations to both Bob and Jill, as they continue to provide their time, energy and leadership on behalf of community banks! 

• May 14 – 17 is ICBA’s 2023 Capital Summit—and, IBANYS’ annual meetings “on the hill” with New York congressional members. Of the 26 Representatives in the New York House delegation, 8 are newly elected: Seven Republicans (Reps. Nick LaLota, George Santos & Anthony D’Esposito from Long Island; Rep. Mike Lawler from the Hudson Valley; Rep. Marc Molinaro from the Hudson Valley/ Southern Tier; Rep. Brandon Williams from Central N.Y,, and Rep. Nick Langworthy from Western N.Y.). . .and, one Democrat: Rep. Dan Goldman from Manhattan & Brooklyn. Please join us to make your voices heard. It’s an important opportunity for New York’s community banks to speak with one unified voice on our major issues and priorities, and to inform and educate our representatives about the vital role we play in the lives of their constituents and neighborhoods  . . . ICBA is also asking community bankers to complete its State of Advocacy survey to help identify new and existing community banker relationships with members of Congress and regulatory agency personnel. Please cc your responses to IBANYS: Johnw@ibanys.net and Stever@ibanys.net. . .TAKE THE SURVEY

IBANYS is proud to announce our new partnership with Rivel, Inc., a market research company with the world’s largest sample Banking Benchmarks Study.

Along with price discounts for new subscription from IBANYS members, Rivel has agreed to provide each of our MEMBER BANKS a Retail Prospect Report extract. These extract reports will be sent to 5 banks each week through the end of the year. These reports will provide information that banks can review for use with their marketing strategies.

We look forward to working with Rivel, Inc. and introducing their platform of reports to our banks in NYS.

Any questions, please call me at 716.880.0518 (cell) or 518.436.4646 (office).

If you have specific questions regarding Rivel, please contact Dailey Betz at 641.529.2380 or email dbetz@rivel.com

John

MEMBER BANKS

Does your bank have news you’d like to share? If so, please send us an email (lindag@ibanys.net) and your news will be placed in our weekly e-newsletter.

We look forward to sharing your news and all that you do for and in your communities.

IBANYS MEETINGS

IBANYS 2023 Regulatory Compliance Update (Virtual)

February 7, 2023

9:00 a.m. – 3:15 p.m.

Have you registered for IBANYS Virtual Regulatory Compliance Update for NY Community Banks scheduled for Feb. 7? Registration is open and there is still time to register.

We have an outstanding slate of speakers that include:

•  OCC
•  NYS Department of Financial Services
• FDIC
• The Bonadio Group
• Plante Moran
• UHY & Barry N. Rein & Associates

The attached brochure provides the detailed meeting agenda and registration information. 

Register today to join us on February 7^th.  

CECL Is Here: See How CECLSolver Can Help

Thursday, January 26 at 2pm ET

https://us02web.zoom.us/webinar/register/4116711126442/WN_f8N5FLi4T1q59DoBFqtH-g

Rethinking your CECL solution? It's not too late to get started. In this brief demo of QwickAnalytics® CECLSolver™—the practical, easy-to-use compliance tool from QwickRate—you’ll see how CECLSolver works. How you can get started quickly. Take the mystery out of WARM calculations, Q factors and timelines. And hear how other banks realize quick success by using the tool to meet compliance requirements — without having to pay consultants or suffering from “analysis paralysis”. Register here.

CECL Coffee Talk Q&A

Friday, January 27 at 10am ET

https://us02web.zoom.us/webinar/register/7216711141582/WN_l5c7LVEATjaats1KbbsqeQ

The CECL deadline is here. So grab a beverage and join the QwickRate/QwickAnalytics monthly CECL discussion to hear more about the challenges banks are facing now as they fully adopt the CECL standard. You’ll hear the latest questions and concerns they’re receiving from banks—including reactions and expectations from their examiners. And panelists will answer your questions in the interactive audience Q&A. Register here.

The Bond Academy is designed to provide community bank professionals with basic knowledge needed to help plan and create effective fixed income investment portfolios.

The customized curriculum was developed to deepen and reinforce the understanding of basic fixed income investment products and portfolio management principles, while also demonstrating how a portfolio can complement the rest of a bank’s balance sheet.

In learning the essentials of fixed income investing, bond pricing, valuation, and selection will be covered extensively.

Who Should Attend?

The Bond Academy is ideal for financial professionals interested in deepening their knowledge of fixed income asset classes and basic investment strategies. CEOs, CFOs, investment managers, directors, as well as new directors serving on investment or asset-liability committees will also find this coursework beneficial.

You Will Learn:

• Bond basics, including bond pricing, duration, and price volatility
• Bond types, including agencies, municipals, mortgage securities, and floating rate instruments
• The composition of a high performing portfolio
• How to understand the rate market: yield curves, spreads, monetary policy
• How economic data affects the bond market
• The impact of interest rate risk on portfolio management
• Portfolio strategies of laddering, barbells, riding the yield curve
• Day-to-day portfolio management techniques
• Evaluating investment portfolio performance

Schedule:

Monday – 4/17

Sessions: 8:00 am - 5:00 pm – Cocktail reception immediately following.

Tuesday – 4/18

Sessions: 8:00 am - 12:00 pm

Detailed Agenda to follow.

Hotel Information:

Embassy Suites by Hilton

1022 South Shady Grove Road | Memphis, TN

Book Your Room

Costs/Person:

Members: $595

Nonmembers: $695

Members & Nonmembers: Save $150/session per additional registration from your bank.

CPE Credit:

Earn up to 12 credits

Prerequisites:

Basic knowledge and understanding of the financial markets.

Additional Information:

– Field of Study: Specialized Knowledge, Economics

– Advanced Preparation: None

– Program Level: Intermediate

– Delivery Method: Group-Live

Questions:

(901) 762-5312

fixedincomeevents@stifel.com

ICBA Securities is registered with the National Association of State Boards of Accountancy (NASBA) as a sponsor of continuing professional education on the National Registry of CPE Sponsors. State boards of accountancy have final authority on the acceptance of individual courses for CPE credit. Complaints regarding registered sponsors may be addressed to the National Registry of CPE Sponsors, through www.learningmarket.org.

For more information regarding individual site administrative policies such as complaints and refunds (if applicable), please contact Hugh Shackelford at (901) 762-5312. No advanced preparation is required for this course. Potential for up to 12 hours credit may be awarded for verified attendance at this group-live seminar. The course level for the Bond Academy is intermediate.

Fixed rate or floating?

Hybrid ARMs give an investor both features

By Jim Reber, ICBA Securities

What’s your choice for the term of the decade so far (that is, other than COVID)? In the last three years, a number of expressions have come

into fashion, some of which have been worn out, used out of context and deemed by linguists to be a blight on our vocabulary. I’m sorry to say these may be around for a while. Here are a few:

Click Here to Read

• Here are the latest updates on 1) legislation introduced in Albany between January 4 – 20, and 2) legislative activity from January 16 – 20.

• Gov. Hochul has yet to present her budget to the state legislature. She will present her budget to the legislature next Wednesday, Feb. 1. Meanwhile, the business of budget hearings, negotiations and the overall budget process is in a holding pattern. Some believe the standoff between the Governor and State Senate Democrats over her nomination for Chief Judge LaSalle hasn’t helped. With longtime Budget Director having recently left state government, Sandra Beattie is Acting Budget Director. She has been First Deputy Director since 2019. She was previously with the U.S. Government Accountability Office in Washington, responsible for multi-state and national analysis of a broad range of key fiscal and policy issues.  https://nystateofpolitics.com/state-of-politics/new-york/politics/2023/01/24/budget-process-stalled-in-albany-after-judge-nominee-standoff

• Gov. Hochul has called for addressing additional overdraft and NSF fees; for an end to “opportunistic sequencing of transactions” and stressed the need to ensure "clear disclosures and alerts of any permissible bank processing charges. She has proposed indexing minimum wages to inflation (annual wage increases would be capped, no details provided), and said an “off ramp” would be available under certain circumstances and conditions. To date, 17 states have tied the minimum wage to inflation. The Governor also pledged to not increase New York's personal income tax this year.  Read More.

• Gov. Hochul's approval rating has jumped to the highest it has been, according to a Siena College poll released. It increased by 7 points since last month, to 56-36%, and her 48-42% favorability rating is also the best it’s ever been.  Read More;   When it comes to not raising state income taxes this year, voters overwhelmingly agree with Hochul. . . link 

• With the legislative session underway in Albany, IBANYS expects 2023 will be a challenging year. We continues to oppose legislation that would negatively impact New York community banks. Major efforts to create public/state banking. . . give credit unions municipal deposits authority. . . address climate change. . .and meet the needs of the “unbanked and underbanked” will all be front and center, as will overdraft and NSF fees and a number of other proposals harmful to community banks and those we serve.  The article below includes many of the hot topics likely to be considered.  IBANYS will be actively engaged on all the aforementioned issues and more, and will need your bank's voice and perspective as we move forward.  https://www.cityandstateny.com/opinion/2023/01/opinion-public-banks-can-help-new-york-meet-its-ambitious-climate-goals/381693/

• DFS Superintendent Harris released regulatory guidance “to better protect consumers” in the event of virtual currency insolvency. It reiterates DFS’s expectation for “sound custody and disclosure practices” for licensed entities. The guidance applies to entities DFS has licensed or chartered to custody, or temporarily hold, store, or maintain virtual currency assets on behalf of their customers. It directs crypto firms to maintain comprehensive records, properly disclose their material terms and conditions, and refrain from false or deceptive marketing. DFS last month released guidance reminding New York-regulated banking organizations to seek prior approval before commencing crypto-related activity.  In a recent Medium op-ed, ICBA President and CEO Rebeca Romero Rainey continued ICBA’s call for policymakers to focus on crypto’s role in facilitating financial crimes and to ensure the traditional banking system continues to be a safe haven from the crypto sector’s instability. https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202301231

• DFS's Financial Risks from Climate Change guidance has also been published and is also available on their website: Climate Change.

• The CFPB was incorrect in determining that the Truth in Lending Act does not preempt a recently enacted New York State disclosure law, ICBA said in a new  comment letter.  The New York law  applies TILA-like disclosures to commercial loans, but its annual percentage rate calculation differs from TILA’s. The CFPB  preliminarily  determined  that TILA does not preempt the New York law because TILA governs consumer credit while the state law governs commercial credit. ICBA Position: In its comment letter, ICBA said: 1) Precedence dictates that a different definition of a term used in TILA creates a contradictory construct that requires preemption;  2) This contradiction is significant—even if one law governs commercial credit and the other consumer credit—because APR is a widely used and understood term and imposing two APR requirements would be a public disservice.  ICBA Recommendation: ICBA concluded by recommending that the CFPB narrowly preempt the New York law and ask the state to use different terminology that does not conflict with TILA. 

• The New York State Farm Bureau says the state should provide unemployment debt relief to businesses who are shouldering the added costs of the COVID pandemic shutdown from spring 2020.  Read More

• The Treasury Department told the National Credit Union Administration that it does not see any compelling reason to raise the 18% interest rate ceiling for loans made by federal credit unions, according to a report from  CU Today. Treasury reportedly told the NCUA the Federal Credit Union Act established the rate ceiling based on the expectation that federal credit unions use their nonprofit structure to offer affordable credit. Treasury noted that banks, "which do not share the non-profit structure and mission of FCUs,” are charging an estimated average APR of just over 13% on non-reward credit cards. The NCUA board  is scheduled  to meet tomorrow on the interest rate ceiling, which is set to revert to 15% in March unless the board acts to keep it at 18%, as it has done for 35 years. The Credit Union National Association and National Association of National Association of Federally-Insured Credit Unions have urged the NCUA to raise the rate ceiling or adopt a floating rate cap amid market interest rate increases.  Grassroots: Community bankers can continue urging Congress to hold hearings on the credit union tax exemption using a customizable message to lawmakers on ICBA’s  Wake Up page.

• The Community Development Financial Institutions Fund delayed the launch of ICBA-opposed changes to the CDFI certification application and said it will revise the updated version it released last fall. In the wake of opposition by ICBA and members of Congress, the CDFI Fund is postponing the launch of the new application beyond the previously anticipated April timeline and will announce a revised timeline “in the near future.” Meanwhile, the CDFI Fund will continue its pause in new application submissions, it said.  ICBA Opposition: In a comment letter and congressional briefing last month, ICBA expressed opposition to application revisions that would rescind CDFI certification for banks that offer loans with annual percentage rates greater than 36% or originate balloon mortgages. ICBA said: 1)  Some community banks offer products with these characteristics due to the unique situation of their customers. 2) Rescinding their certification would harm CDFI banks—particularly those that have received Emergency Capital Investment Program funds—while preventing other banks from seeking the certification. Congressional Pressure: ICBA and other groups later requested a meeting with members of Congress to discuss the revisions. Last week, Senate Banking Committee members Mark Warner (D-Va.) and Mike Crapo (R-Idaho) encouraged  the Treasury Department to consider stakeholder concerns with the changes, citing the need for CDFIs to be creative and flexible to meet the needs of historically underserved borrowers. ICBA will continue working with the CDFI Fund, Treasury, and Congress to ensure any revisions to the CDFI certification application are not detrimental to community banks and the communities they serve.

• House Financial Services Chairman Patrick McHenry (R-NC)  announced the Committee’s GOP members, including two New Yorkers: Rep. Andrew Garbarino (R-L.I.) and Rep. Mike Lawler (R-Lower Hudson Valley). Democratic members have not yet been announced. Meanwhile, new members of the House Agriculture Committee also include two New Yorkers:  Reps. Nick Langworthy (R-Western NY) and Marc Molinaro (R-Hudson Valley), and Rep. George Santos (R-L.I.) will serve on the Small Business and the Science, Space and Technology Committees.

• In the American Banker, ICBA President & CEO Rebeca Romero Rainey said regulators should not impose climate risk regulations on community banks, which have decades of experience managing concentration risks and responding to extreme weather events.

• Rep. Ritchie Torres (D-Bronx) believes crypto currency can address the failures of the traditional financial system in communities like the South Bronx, which he represents and is one of the poorest areas in the nation.

• Although Six Republican members of New York's congressional delegation have called for Rep. George Santos (R-L.I.) to resign or issued statements making it clear they don't want to have anything to do with him, Rep. Elise Stefanik (R-North Country) is not among them,  the Times Union writes.  House Speaker McCarthy said Santos could be removed from office if the House  Ethics Committee determined he had broken the law – but not until then.  Bloomberg reports.

• Federal regulators are working to finalize climate risk proposals they say will target the nation's largest financial institutions. Community banks are concerned the proposals would inevitably “trickle down” and subject us to new and expensive regulatory burdens. See ICBA President and CEO Rebeca Romero Rainey's new op-ed in The American Banker on the issue. 

• President Biden is reportedly close to naming a successor to National Economic Council (NEC) Director Brian Deese, who is expected to leave his post soon. Top rumored potential contenders:  Federal Reserve Vice Chair Lael Brainard; Deputy Treasury Secretary Wally Adeyemo; former NEC Director Gene Sperling; former HHS Secretary Sylvia Mathews Burwell; NEC Deputy Director Bharat Ramamurti and Commerce Secretary Gina Raimondo.   The Washington Post

• Jeff Zients  will reportedly replace Ron Klain as President Biden's  White House Chief of Staff after next month's State of the Union address.  Zients left the White House in April after steering the administration’s pandemic response and the largest vaccination campaign in U.S. history. He returned to the White House in the fall to help Klain prepare for staff turnover after the midterms.  https://www.politico.com/newsletters/playbook/2023/01/22/klain-is-out-zients-is-in-00078903?nname=playbook&nid=0000014f-1646-d88f-a1cf-5f46b7bd0000&nrid=00000152-f737-dcf0-a7d7-f73fb7700001&nlid=630318 

• House Financial Services Committee Chairman Patrick McHenry (R-NC) has reportedly warned fellow House Republican leaders to be reasonable and realistic as they demand federal spending cuts in exchange for raising the nation's debt ceiling. https://news.yahoo.com/mchenry-warns-fellow-gop-leaders-180207254.html?mkt_tok=ODUwLVRBQS01MTEAAAGJiAZs4q7TMuy52C2IsuMWO3Gs7K26lI9UxvcFbh4iqg2DC1cJltU0Y5_WLfGnbMqHhhAqyqDJqw3GM9oBpU2xXKnCYwJQppHprkPD77atj-bM

• A new paper from the Federal Reserve Bank of Boston finds Blacks and low-income consumers absorb a larger share of bank account and credit card fees than other groups.  Read story →