IBANYS Weekly E-Newsletter |
|
-
Visit our website at www.ibanys.net to review our daily updates on COVID-19.
|
|
The President's Message
By John Witkowski, President & CEO
As you know, this week the NYS Senate and Assembly placed legislation allowing credit unions into the municipal deposits business on the agendas for their respective Banks Committee meetings.
Credit Union Muni Deposits Legislation Pose A Major Challenge
Yesterday, the Senate Banks Committee met and reported S.670 (sponsored by Chairman Sanders), to the Senate Finance Committee for consideration. Today, the Assembly Banks Committee me and reported out the Assembly companion bill, A.07334 (sponsored by Chairman Pichardo), to the Assembly Ways & Means Committee. IBANYS is planning to hold further discussions next week with Assembly Banks Chairman Pichardo to fully explain our concerns with, and opposition to, this legislation.
Because of the huge supermajorities majorities that Democrats now hold in both chambers, this year our task in opposing these bills -- and others such as S.1762-A/A.5782, to create a state/public bank (IBANYS' Memo in Opposition), and S. 191 to allow credit unions into the State Linked Deposit Program (Read IBANYS' Memo in Opposition here) is extremely challenging. Unlike previous legislative sessions, we cannot rely upon a firewall of support from a GOP-controlled Senate, or assistance/ opposition from the Governor, since any veto can now be overridden.
Nevertheless, IBANYS continues to make our case with the relevant committees that these bills would further help tax-exempt credit unions -- which are not subject to the same regulatory/CRA mandates and oversight as banks are -- and further disadvantage taxpaying community banks and make the playing field even more unfair. If and when these bills reach the floors of the full Senate and Assembly for votes, we will need your help in reaching out to your local state senators representatives and urging them to vote no. Together, let's make the voices of New York's community banks heard in Albany. Here is the NYS Assembly Directory: https://nyassembly.gov/mem/search/ . . . here is the NYS Senate Directory: https://www.nysenate.gov/registration/nojs/form/start/find-my-senator
As is always the case, the credit unions are looking to grow their business while getting away from their original purpose.
# # # #
Many of you recently participated in IBANYS' conference calls with members of the New York congressional delegation and our U.S. Senators. We described community banks' vital role as "the economic first responders" during the pandemic, providing essential support for small businesses, homeowners, consumers and their local communities in general. We also discussed several federal issues with them. Here is a link to the issues we discussed: https://www.icba.org/newsroom/blogs/events-blogs/2021/04/01/capital-summit-spring-2021-lobby-priorities with details on some of those priorities.
-
We encourage you all to follow up these discussions by emailing or calling those we met with. Please use this list to make your contacts:
# # # #
I wanted to make you aware of the OCC’s Semiannual Risk Prospective for Spring 2021 published this week, which we received and were encouraged to share with our members. In this report you will find the agency’s perspective on key risk issues to the industry. Highlights from the report include:
- Credit risk is elevated and transitioning as the economic downturn continues to affect borrowers’ ability to service debts. Assistance programs and federal, state, and local stimulus programs have suppressed past-due levels.
- Strategic risks associated with banks’ management of Net Interest Margin (NIM) compression and efforts to improve earnings is elevated. Banks attempting to improve earnings may implement measures including cost cutting, increasing credit risk (both credit and investments) or extending duration.
- Operational risk is elevated due to a complex operating environment and increasing cybersecurity threats.
- Compliance risk is elevated as banks’ expedited efforts to implement assistance programs continue to challenge established change management, product, and service risk management practices.
Please let me know if you have any questions, or you may contact Ryan Portell, Program Manager, Banking Relations, Office of the Comptroller of the Currency: Ryan.Portell@occ.treas.gov
# # # #
According to a recent study by Accenture, “Banks will lose 35% of their market share to retail solutions such as Google, Amazon and other FinTech’s by 2020”. . .and, “consolidation will continue to play out between now and 2020, by which point we estimate that 15 to 25 percent of today’s roughly 7,000 North American financial institutions could be gone.” There may be a new untapped market of 150 million "Bank Challenged people" out there. . . 81 million of them, Millennial’s who shun traditional banking and will pay for convenience and speed? SWORD® Technology= Efficient, Agile, Innovative/Vision, High Tech, Digital with Execution thru Bank & Retail Partners for Strategic, Fast Distribution! For details: http://seetekcorp.com/about-seetek.php
The New York State Department of Financial Services is holding a webinar series for banking institutions on the physical risks related to climate change in New York and the Northeast. The first webinar will cover several climate-related physical changes that are likely to occur in the region such as flooding, extreme precipitation, snowfall, extreme temperature, and drought. The second webinar will focus on coastal risks, such as sea level rise, hurricanes, and coastal storms. The webinars will be led by Mark Lowery, the Assistant Director of the New York State Department of Environmental Conservation’s Office of Climate Change.
Session 1: Overview of Physical Risks from Climate Change in New York and the Northeast – May 24, 2021, 1 - 2pm. . .Please register here with Password ClimChg052421
Session 2: Coastal Risks from Climate Change in New York and the Northeast – May 26, 2021, 1 - 1:45pm. . .Please register here with Password ClimChg052621
With any questions, please contact Yue (Nina) Chen, Ph.D.
Director of Sustainability and Climate Initiatives, New York State Department of Financial Services: nina.chen@dfs.ny.gov.
# # # #
As always, thank you for all you do every day for your customers, your communities and our industry. . . and, of course, for our industry and IBANYS!
|
|
ASSOCIATE MEMBERS & PREFERRED PARTNERS |
|
|
|
Upgrade’s founding team pioneered fintech over a decade ago. In 2017 we launched Upgrade to create a mobile banking experience that delivers exceptional value to our customers by offering affordable and responsible credit through cards and loans and market-leading rewards. In four short years, over 15 million people have applied for an Upgrade card or loan, and we have made over $5 billion in affordable and responsible credit available to our customers. Our innovative Upgrade Card combines the flexibility of a credit card with the low cost of an installment loan. Our latest offering, Rewards Checking, gives customers access to no-fee checking accounts with 2% cash back rewards on common everyday spending. Learn more about the team.
|
|
About Bankers Healthcare Group |
BHG is transforming the financial industry, leveraging the power of data, analytics, and cutting-edge technology to become not only one of the best sources for high-performing loans, but the creator of one of the largest community bank loan and product networks in the country.
Since 2001, BHG has originated more than $8 billion in loan solutions to top-quality borrowers, which community and midsize banks can access via a state-of-the-art loan delivery platform. Building on nearly two decades of innovation, BHG and its family of brands now offer a full suite of financial solutions that span business, consumer, and SBA 7(a) loans, credit cards, collection services, risk management services, and point-of-sale financing with a focus in patient lending.
With record growth year after year, BHG continues to be recognized regionally and nationally: earning a spot on the Inc. 5000 for 14 years running and receiving accolades from Great Place to Work® and Fortune magazine, among others. BHG is partially owned by Pinnacle Bank (PNFP) and has headquarters in Davie, FL, and Syracuse, NY.
|
|
|
|
Munis for the many
Taxable municipal bonds have appeal for nearly all community banks.
By Jim Reber
|
I have some good news for community bank portfolio managers who have grown weary of some or all of the following conditions that have persisted since 2020:
- declining portfolio returns
- erratic cash flows
- call option exposure
- paltry yield spreads
|
|
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.
|
|
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.)
|
|
Legislative Activity
-
State lawmakers are calling for an expedited process for tenants and landlords to again access in rental assistance approved earlier this year by the state and federal governments. Read More
- Governor Cuomo signed legislation (S.5923-A/A.6617-A) protecting New Yorkers' COVID-19 stimulus payments from being garnished by debt collectors. All relief payments to New Yorkers under these federal acts, including stimulus payments, tax refunds, rebates and tax credits to support individuals and children qualified for or received prior to the effective date, will be protected. DFS Superintendent Lacewell said the new law “protects individuals and families from debt collection against COVID-19 relief payments from Congress, including from banks for debts they claimed against their customers' accounts. . .The department is committed to protecting financial security of all New Yorkers, especially those in communities that have been most impacted by COVID-19."
|
|
-
Many of you participated in IBANYS' conference calls with members of the New York congressional delegation and our U.S. Senators. We described community banks' vital role as "the economic first responders" during the pandemic, providing essential support for small businesses, homeowners, consumers and their local communities in general. We discussed our positive economic impact, saving thousands of local small businesses and jobs throughout our state. . .helping home owners keep their homes through mortgage forbearance and other means, and much more. We also reviewed our the top federal issues and priorities. Now, it's time to follow-up with these offices. We encourage you all to continue your dialogues by emailing or calling those we met with. Here is a link to the issues we discussed: https://www.icba.org/newsroom/blogs/events-blogs/2021/04/01/capital-summit-spring-2021-lobby-priorities with details on some of those priorities. To reach those you spoke with, Use this directory list
-
ICBA is encouraging community bankers to call on Congress to hold hearings on credit union acquisitions of taxpaying community banks. (IBANYS urged members of the New York Congressional Delegation to support this effort during our recent grassroots calls.) ICBA’s Be Heard grassroots action center makes it easy for community bankers to contact their members of Congress. Community bankers can continue the campaign against the credit union tax exemption at this month’s ICBA Capital Summit, which is set to livestream April 27 with remarks from top policymakers and virtual meetings with congressional offices. CONTACT CONGRESS
-
ICBA expressed support for an OCC announcement that it will reconsider its Community Reinvestment Act rulemakings and information collection. The OCC said it will reconsider its June 2020 rule, will not object to institutions suspending its implementation, does not plan to finalize its December 2020 proposed rule on CRA evaluation benchmarks, and is discontinuing CRA information collection announced in December. In a statement, ICBA noted it has called on the OCC to delay or withdraw its CRA rule so it can work with the FDIC and Federal Reserve on an interagency CRA rulemaking.
-
The SBA said there is approximately $5 billion remaining in PPP funds set aside for certain community financial institutions. While the general PPP fund is exhausted, the remaining funds apply to Community Development Financial Institutions, Minority Depository Institutions, and certain other lenders. As some small businesses continue seeking PPP loans, community banks that are no longer eligible may use the FDIC’s interactive map of CDFIs and MDIs to direct borrowers to these institutions, which may be able to satisfy loan requests. However, accepting PPP loans from outside CDFI Fund target markets could put CDFI certification at risk, which could affect eligibility for Emergency Capital Investment Program investments. More information is available in CDFI Fund guidance.
-
The Federal Reserve Board for the third time extended its rule allowing certain bank directors and shareholders to apply to their banks for Paycheck Protection Program loans for their small businesses. The SBA clarified last year that lenders may make PPP loans to businesses owned by their directors and certain shareholders. The rule extension is effective immediately and applies to PPP loans made since March 31, consistent with SBA's rules and restrictions. Additional PPP information is available on ICBA's PPP Resources page.
-
Banks maintained sound capital and liquidity levels, but profitability remains stressed due to low interest rates and low loan growth, according to the OCC’s latest Semiannual Risk Perspective. According to the report: Credit risk is elevated and transitioning as the economic downturn continues; Strategic risks associated with banks’ management of Net Interest Margin compression and efforts to improve earnings are elevated; Operational risk is elevated due to a complex operating environment and increasing cybersecurity threats; Compliance risk is elevated amid banks’ expedited efforts to implement assistance programs.
|
|
|
|
|
|
|
