HAPPY NEW YEAR FROM IBANYS. . . Let's Work Together To Make 2023

A Great Year For New York Community Banks!

Happy New Year! My best wishes for happy, healthy and prosperous 2023!

In 2023, we will continue to “push a rock uphill” when it comes to legislative issues. While we have been successful in opposing and fighting against bills that negatively impact banks and we have developed legislation that will help our communities have access to capital, there is always a bill or two that are signed that leave us scratching our heads. The Mortgage Foreclosure law (or the "Foreclosure Abuse Prevention Act" or FAPA) signed by Governor Hochul on Dec 30, 2022 was one of those surprises. 

I have included three links below for you to read. One is a press release from Senator Sanders (D-Queens), the State Senate Banks Committee Chairman who was a sponsor this legislation. The other two are articles providing details on how the law may impact banks.

•  https://dingo.telicon.com/NY/library/2023/2023010481.PDF

•  https://www.silive.com/news/2023/01/this-new-law-makes-it-harder-for-lenders-to-foreclose-on-new-york-homes.html

• National Mortgage Professional

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• Financial Risks from Climate Change — DFS’s Financial Risks from Climate Change guidance has been published to their website: Climate Change link for your convenience.

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•  IBANYS' Virtual Compliance Meeting is February 7^th, 2023. Please join us as we have three regulatory agencies (OCC, FDIC and DFS) joining the call to provide insight on what to expect in 2023 as well as other subject matter experts to present on topics that are important to community banks.

• ICBA’s 2023 Capital Summit-- and IBANYS’ meetings with New York congressional members -- has been successfully rescheduled to  May 14 – 17, 2023. (The original dates fell during a period when the House had scheduled a recess and will not be in Washington.) Please plan to join us in Washington to make your voices heard. More information will be coming out about this very soon.

•  The State Department of Financial Services (DFS) is encouraging assistance for New York consumers and businesses adversely Impacted by the recent winter storm. DFS is urging banking organizations to provide assistance to New York consumers and businesses adversely impacted by the recent severe winter storm. Here is a letter from DFS Superintendent Harris.

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

Lake Shore Savings Bank President/CEO Announces Plans to Retire in May 2023

Orchard Park, NY, Dec. 22, 2022 – Daniel P. Reininga, president and CEO of Lake Shore Bancorp, Inc. (NASDAQ: LSBK), the holding company for Lake Shore Savings Bank, today announced his plans to retire in May 2023 after serving 29 years with the bank, including 12 as CEO.

Reininga, 64, took the helm in 2011 when the bank’s assets were $488 million and grew them to approximately $700 million. His vision to grow the commercial division has had a significant impact on the bank’s financial success. Reininga joined the bank in 1994 as an outside director and was Executive Vice President Chief Operating Officer from 2010-11.

Founded in 1891 in Dunkirk, the community bank focuses its efforts on deposits, businesses and mortgages in Erie and Chautauqua counties. Reininga oversaw an 11-branch network, with 1,900 surcharge-free ATMs across Western New York. The branches include locations in Dunkirk, Fredonia, Westfield, Jamestown, Lakewood, Kenmore-Tonawanda, Depew, Snyder, Hamburg, East Amherst and Orchard Park.

“Dan served the bank with distinction through periods of rapid growth, as well as the aftermath of the Great Recession and through the COVID pandemic,” said Board Chair Kevin M. Sanvidge. “Lake Shore is serving more communities and consumers than ever before, and much of that is due to Dan’s vision, and his team’s execution of his vision.”

The board plans to conduct a national search for a new president and CEO, Sanvidge said.

“I have been privileged to work with extraordinary bankers, as well as board and community members during the last 12 years,” Reininga said. “I will treasure that work, but more so the relationships attached to it. And, above all, I know I am leaving the bank in capable hands as we continue to follow our mission of Putting People First.”

Reininga earned his B.S. in economics from Allegheny College in 1980; received an MBA from the University of South Florida in 1987; and in 2010 gained a graduate degree in banking from the American Bankers Association Stonier National School of Banking in Philadelphia.

After college, he worked for the Talon Zipper Co. in Meadville, PA for five years before getting his MBA. He next joined Dunkirk-based G.H. Graf Realty Corp., Inc. a fourth-generation family business he became president of in 1993. He continues to serve as the real-estate development and property-management company’s board chair. After serving from 1993-2010 as president of Graf and as an independent director at the bank, he joined the bank’s executive management team. At the time, he was vice chair of the Bank’s Board of Directors.

Reininga, who remains as CEO until the company’s annual shareholders meeting in May, served on numerous boards, including the SUNY Fredonia College Foundation and Brooks Memorial Hospital. He is currently a member of the boards of the Gow School, Buffalo Hearing and Speech Center, and the Mikey’s Way Foundation. Reininga is also chairman of the Northern Chautauqua Community Foundation’s $10 million capital campaign.

He received multiple awards during his career, including Business First, 40 under 40, 1997; Business First C-Level, 2019; Mikey’s Way Hero, 2013; Fredonia Chamber of Commerce, community service award, 2016; Allegheny Highlands Good Scout Award, 2016 and the City of Dunkirk Community Service Award.

Reininga and his wife Wendy have four children and four grandchildren.

About Lake Shore Savings Bank

Lake Shore Bancorp, Inc. (NASDAQ:LSBK) is the mid-tier holding company of Lake Shore Savings Bank, a federally chartered, community-oriented financial institution headquartered in Dunkirk, New York. The bank has eleven full-service branch locations in Western New York, with five locations in Chautauqua County and six locations in Erie County. The bank offers a broad range of retail and commercial lending and deposit services. The company’s common stock is traded on the NASDAQ Global Market as “LSBK.” Additional information about the company is available at www.lakeshoresavings.com.

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

• With the State Legislature set open the 2023 session. IBANYS will continue to fight and advocate for community banks in New York State, as we work to inform and remind the Legislature and Governor that community banks are the foundation of their communities, and play a vital role in the local and state economy and social fabric. Governor Hochul was sworn in on Sunday to a full term in office. Read more here. Hochul is expected to unveil her policy vision in greater detail during her State of the State addres on January 10. (The address is traditionally delivered at the beginning of the new state legislative session; this year, legislators returned on January 4.) She will also "flesh out" her agenda in her state budget proposal later this month. It is often also a vehicle to pass a host of nonfiscal policy prioritie. Passing her agenda will mean working in tandem with Democrats in the State Legislature who hold veto-proof supermajorities in both chambers and have influential blocs of members to the left of Hochul on an array of policy issues. https://www.nytimes.com/2023/01/01/nyregion/hochul-inauguration-ny-governor.html. Indeed, the Governor is facing a series of challenges to her power in Albany,  State of Politics reports.

• The Legislature will return to Albany for a six-month session facing a rapidly shifting economic and political landscape and a potential recession, likely forcing potential debates in the coming budget talks over taxes and spending. Here are five things to watch for as lawmakers begin the 2023 legislative session. Read More. . .And, here is this year's State Legislative session calendar: https://nyassembly.gov/leg/docs/session_2023_calendar.pdf. 

 

• The New York State Senate Democratic Majority has named committee chairs for the 2023-24 legislative session. Senate Banks Committee Chairman James Sand ers (D-Queens) will retain his position. Here is the complete list of State Senate Committee Chairs for the new session.

• In addition to the previously noted foreclosure law, the Governor also signed another bill approved in 2022 into law. Chapter 830 of the laws of 2022 will require a bank to cash checks of $500 or less with sufficient funds which are drawn on the bank with valid identification.

• In her final official act of 2022, Gov. Hochul signed legislation increasing the annual pay of state lawmakers by $32,000 -- making them the highest paid state Legislature in the country.  Read More.  

• The Governor issued a 12-page list of legislation that will take effect in 2023.  link

• Republican Lester Chang (Brooklyn) was sworn in Tuesday as a member of the Assembly despite ongoing residency concerns that could give the Democratic supermajority the pretext they need to block him from taking the seat he won. Democrats in the state Assembly are yet to determine whether they will push to oust Chang. 

• Late in 2022, Governor Hochul issued veto message 104 of A.9656, legislation which would have required notice of overdraft fees.  Hochul noted while she strongly supports consumer protection measures, this bill would mandate disclosures that are duplicative of existing federal disclosure requirements contained in the Truth in Savings Act and its supporting regulations. She stated: "These existing regulations require depository institutions to disclose the total dollar amount for all fees or charges imposed on an account when there are insufficient funds, and the total dollar amount of fees and charges for returning unpaid items. This redundancy could cause consumer confusion in the marketplace and would be preempted by federal law." 

• DFS Superintendent Harris released Guidance to banking organizations that wish to engage in virtual currency-related activities.  The Guidance is applicable to all New York regulated banking organizations, as well as branches and agencies of foreign banking organizations licensed by the Department. The Guidance is final; however, DFS looks forward to continuing to engage with key stakeholders on these important issues. As such, stakeholders are invited to provide comments on this Guidance to bankingcomments@dfs.ny.gov, which the Department will take into account as it continues to supplement and refine the supervisory framework applicable to Covered Institutions. A copy of the Guidance can be found on the DFS website  here.  To develop the Guidance, DFS conducted a robust analysis of the existing regulatory landscape and market trends, and engaged with consumer advocates, other state and federal regulators, industry, and academics.

• Democrats in the state Senate retained their supermajority with the victory -- by 10 votes -- of State Sen. John Mannion in central New York.  Spectrum News reports.   At least 39 “new legislators will be coming to Albany in January for the 2023 session.   Meet the newbies coming to town in 2023. . . .And,  here’s a preview of some of the major issues they’ll be working on.

• Congress was scheduled to begin its new session this week with the House under GOP control, beginning with the election of a new Speaker of the House -- but that election produced no winner after three ballots on Monday, as up to 20 GOP members voted for candidates other than the officially endorsed candidate, House GOP Leader Kevin McCarthy (R-CA), and the House adjourned until noon today. Meanwhile, House Democrats formally elevated Rep. Hakeem Jeffries (D-Brooklyn) of New York to be their leader. Hakeem Jeffries Takes Over as Leader of House Democrats, . . . The New York Times reports. Here is this year's Congressional calendar: U.S. Senate and House calendar  

• Embattled Rep.-Elect George Santos (R-L.I.) has not yet been sworn in to the House (no one has been, pending the election of a Speaker), but he finds himself in limbo in Washington. . .and now, in Brazil. https://enewspaper.nydailynews.com/infinity/article_share.aspx?guid=5706d6fe-48f4-42c8-8977-261d991aa69c

• Federal banking regulators issued a statement highlighting key crypto risks for banking organizations and describing the agencies’ approaches to supervision in this area. The  joint statement  cites key risks associated with crypto-assets and the crypto sector, including fraud risk, legal uncertainties, misleading representations, and market volatility. The agencies cited the importance of ensuring crypto risks “that cannot be mitigated or controlled” do not migrate to the banking system, and they said issuing or holding as principal crypto-assets is “highly likely” to be inconsistent with safe and sound banking practices.  Previously issued guidance from the Federal Reserve, FDIC, and OCC encourage banks to notify their lead supervisory point of contact of their intent to engage in crypto-related activities. Joint guidance issued in November 2021 summarizes the regulators’ “policy sprints” designed to begin laying the regulatory groundwork on crypto assets. ICBA Position: A recent Medium op-ed from ICBA President and CEO Rebeca Romero Rainey that 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.

• As we prepare for the 2023 congressional session, ICBA President & CEO Rebeca Romero Rainey wrote in a  message to community bankers that ICBA and community banks had a successful year in advocacy in 2022 -- including efforts on the Durbin Amendment, crypto policy, the credit union power grab, and regulators’ climate risk efforts.  Read more.

• ICBA and other groups called on the Small Business Administration to withdraw two proposed rules that would harm the agency’s 7(a) loan program. The proposed rules—which the SBA says are designed to aid underserved borrowers—would: 1) Lift the SBLC moratorium—which has been in place since 1982—on the number of non-federally regulated institutions, including nonbank fintech companies, that can make loans under the 7(a) program, and  2) Loosen or remove the 7(a) program’s requirements for how lenders underwrite loans and how borrowers may use loan funds.  In a joint letter,  ICBA and the other financial groups said the proposals could unintentionally harm the very borrowers the SBA is trying to aid, negatively affect underwriting standards and portfolio performance, and erode the program’s integrity.  The comments to the SBA follow a separate joint letter to Congress last month calling on lawmakers to oppose the agency’s proposals.

• 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 and its Wake Up Messaging Playbook.

• The Fed has become more aggressive in its pursuit to curb inflation, and former Federal Reserve Bank of New York President William Dudley said the central bank’s actions mean a recession is likely. “A recession is pretty likely just because of what the Fed has to do, but what’s different this time I think is that if we have a recession, it’s going to be a Fed-induced recession and the Fed can end the recession by subsequently easing monetary policy. . .I don’t think that there’s a big risk of a financial-instability cataclysm that pushes the economy into a deep recession.” A Wall Street Journal survey found that two-thirds of economists believe that a recession is on the horizon.  https://thehill.com/policy/finance/3796536-former-new-york-fed-chief-recession-pretty-likely-in-us/?mkt_tok=ODUwLVRBQS01MTEAAAGJG99xVJ7xKUx68OH9KW871Ym3ywKAhl-F6eoH_-liGPbIlW7BHPHlwzVfN1BI3MQSu8-IXad60d4C3qa7rp23oxwhlzVLhmenBoHRFwPbR50C