IBANYS Weekly E-Newsletter |
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The President's Message
By John Witkowski, President & CEO
In Albany, state budget negotiations continue to claim center stage in the legislative process in advance of the April 1 deadline. In Washington, Congress is focused on global matters as well as the economy and key regulatory personnel. At IBANYS, we continue to work on your behalf in both our state and national capitals, and to finalize plans for a series of educational programs for New York community bank senior executives, officers, directors and employees.
Also, we have been asked to work with NYS DFS to provide feedback from state chartered banks on their new proposed guidance on managing financial risks from climate change. (See our Albany section below.)
Today's newsletter includes program descriptions and registration details on a number of important upcoming IBANYS meetings. The information is available on our website (www.ibanys.net) and via the link below. We hope you, your bank's officers, directors and employees, will participate in these important and timely sessions. For full details: https://ibanys.net/meetings-schedule/. . . Here’s an outline of our schedule:
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"Spring into Action" Virtual Conference – Virtual - April 4-5 – Your bank “PAYS ONE PRICE” FOR ALL BANK EMPLOYEES TO PARTICIPATE.
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Directors Conference – Virtual – April 11.
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Capital Summit/IBANYS “Hill Meetings – May 1 – 4, in Washington, D.C. & Virtual. 2022 ICBA Capital Summit. Details on IBANYS' hill meetings with New York congressional delegation to follow.
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IBANYS ANNUAL CONVENTION – In-Person - JUNE 13-15, 2022, TURNING STONE RESORT AND CASINO. Sponsorship and Trade Show information are available.
The "American Banker" ran an article this week about how IBANYS member Five Star Bank has embraced digital lending, banking-as-service, real-time payments, bitcoin and more. “Those that don’t innovate don’t survive,” said Chief Administrative Officer Sean Willett. The American Banker has the information. A most interesting piece! Read story →
. . .As always, we thank you for your continued participation and support.
. . .John
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Mark your Calendars and Save the Dates - IBANYS 2022 Meeting Schedule
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IBANYS Virtual Conference
April 4-5, 2022 - via ZOOM
NYS Community Banks "Spring" into Action
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Please mark your calendars and register today for IBANYS New York State Community Banks “Spring” Into Action virtual meeting. This virtual event (conducted via Zoom) will take place on April 4 & 5, 2022. Each day will begin promptly at 8:30 a.m. and adjourn at 2:45 p.m. This format provides IBANYS an alternative way to continue to provide important and timely educational programs to all New York Community Bankers and their staff.
Click the link below for the detailed agenda and registration information. We have put together an outstanding slate of speakers who will share their knowledge and expertise on an array of topics that are timely and important to the banking community. You may earn up to 12 continuing professional education (CPE) credits. See the brochure for details.
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2022 Virtual Bank Directors Conference - Live Webinar
April 11, 2022
8:30 a.m. - 1:45 p.m.
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The role of a community bank director is one that is always changing and has never been more critical to the success of your bank. The 2021 IBANYS Virtual Directors Conference is an informative and engaging event designed to help you gain the tools essential to guide your bank’s growth and profitability and sustain its vision for the future.
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Please watch your emails later this week for the complete detailed meeting brochure.
Below is a list of sponsors to date - THANK YOU!!
- SHAZAM
- Neach
- Federal Home Loan Bank of NY
- Bankers Healthcare Group (BHG)
- Shield Compliance
- ICBA
- The Baker Group
- T. Gschwender & Associates
- Plante Moran
- COCC
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IBANYS ANNUAL CONVENTION
June 13-15, 2022
Turning Stone Resort & Casino
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Advanced Booth and Sponsorship Registration
A block of rooms have been reserved at the Turning Stone Resort & Casino. Reservations can be made by contacting the Turning Stone Resort at (800) 771-7711. Refer to group: IBANYS Convention. Room cut-off: May 19, 2022. (We cannot guarantee room availability and pricing after this date.) Tower King/Double Rooms rate= $164. Tower Junior Suites rates $244 (single/double occupancy).
WE STRONLY RECOMMEND YOU MAKE YOUR RESERVATIONS EARLY. THE ROOMS WILL SELL QUICKLY. Cancellations must be made 48 hours prior to day of arrival.
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ASSOCIATE & PREFERRED PARTNERS |
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IBANYS WELCOMES OUR NEWEST ASSOCIATE MEMBER |
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TransWestern Capital Advisors harnesses the power of best-in-class fixed income and risk management on behalf of community banks across the country. The firm was founded and managed by bankers for bankers, and key principals have worked with community banks for 30 years.
TWC offers co-mingled and customized on-balance sheet investment solutions, including an SEC-registered mutual fund created specifically for banks that offers next-day liquidity, 20% risk-weighting, and active interest rate risk management. The firm also tailors investment and liquidity management solutions to optimize performance and manage risk, all as defined by bank leadership.
Contact: Kendrik de Koning
Phone: 800-997-0718
Email: kendrik@transwestcap.com
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Contact: Darreck Mitchell
Phone: 781-367-2137
Email: darreck@sunwealth.com
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IBANYS WELCOMES OUR NEWEST ASSOCIATE MEMBER |
Sunwealth is a clean energy investment firm working to change who has access to renewable energy by changing the way we invest in it. Since 2014, Sunwealth has invested over $80 million in 500+ community-based solar projects nationwide and attracted investment from leading impact-driven investors, including Calvert Impact Capital, Sierra Club Foundation, Boston Impact Initiative and over 400 high net worth individuals, foundations, family offices, endowments and corporations. In 2021, Impact Assets named Sunwealth to its IA50, a leading list of impact fund managers.
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Join community bankers from across the country to advocate for our industry—in person. You have the power to share your personal story and put a name to our industry's key legislative priorities.
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Rising tide
Bonds to own for a rate hike environment
By Jim Reber
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Community bankers are nothing if not predictable, and I mean that as a compliment. They are bright, enterprising, have a nose for the risk/reward dynamic and a sense of duty and loyalty to their customers and staff. They’re also deathly afraid of rising interest rates.
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IBANYS has been asked to coordinate feedback for DFS from state chartered bank executives and to participate in a round table on managing the financial risks from climate change. DFS guidelines have been developed, including which size of banks the guidance should apply to like OCC’s Principles for Climate-Related Financial Risk Management for Large Banks. DFS is addressing these potential concerns in the draft guidance by emphasizing a proportionate, risk-based, and iterative approach. The guidance is for supervisory dialogue, and institutions can start qualitatively with existing data, then gradually evolve to be more sophisticated. DFS is not setting a timeline for implementing the expectations in the guidance right now, which is to give institutions time to do the work at a pace that makes sense to them. Read the guidance
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New York State has the third-highest state and local taxes in the nation according to a WalletHub report released today. Based on median U.S. household income, New Yorkers pay an average of around 14% of their income in state and local taxes. That would be around $8,900 annually, which is $5,206 more than Alaska, which has the nation’s lowest state and local tax rate.
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New York's state budget is being negotiated against the backdrop of increasing global uncertainty: war in Europe, rising gas prices and sanctions meant to stymie Russia's attack on Ukraine. Read More
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New York officials are deploying the financial, regulatory and legislative might of the Empire State against Russia after it invaded Ukraine. Meanwhile, New York legislators are urging Gov. Hochul to suspend the state’s gas tax, as prices are expected to continue increasing under the newly announced federal ban on Russian oil imports. However, Hochul noted there's no guarantee New York drivers will see a positive impact from the suspension of the state's sales tax on gasoline, though the issue remains under review, Gov. Kathy Hochul said Monday. Read More
- Gov. Hochul recently announced actions to strengthen the State Department of Financial Services' (DFS) enforcement of sanctions against Russia, including the expedited procurement of additional blockchain analytics technology. These tools will bolster DFS's ability to detect exposure among DFS-licensed virtual currency businesses to Russian individuals, banks and other entities that the Biden Administration has sanctioned. DFS Superintendent Harris noted: ""We know that bad actors will try to evade sanctions through the transmission of virtual currency, which is why it is imperative that we have the ability to monitor transactions and exposure in real-time. We continue to coordinate closely with federal and other state regulators and communicate with our regulated entities to ensure the full weight of our regulatory regime is brought to bear in the fight to protect Ukraine."
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With Senate Banks Chairman Sanders focusing more on his legislation to create a state/public bank -- rather than on establishing local municipal public banks -- IBANYS continues to oppose to the legislation and has drafted a Memo in Opposition. . . . Also Read IBANYS Background & Talking Points Opposing this legislation and proposed possible alternative approaches to help meet the needs of unbanked and underbanked populations.
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ICBA is running a targeted digital campaign encouraging congressional offices to press credit unions on acquisitions of community banks and other key issues. ICBA Campaign: ICBA launched the campaign last week while calling on lawmakers to ask tough questions about the credit union tax exemption to credit union officials who were in Washington for advocacy meetings. Video: The campaign features a recently released ICBA video urging Americans to advocate congressional hearings on how credit unions are taxed and regulated. 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 and its Wake Up Messaging Playbook.
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ICBA expressed support for Senate legislation to promote tiered banking regulation by requiring agencies to tailor regulatory actions based on the risk profile and business model of affected institutions.
Details: Introduced by Senate Banking Committee member Mike Rounds (R-S.D.), the TAILOR Act of 2022 (S. 3745) also includes provisions to:
- Allow certain community banks to file a short-form call report in the first and third quarters.
- Require the banking agencies to review the impact of regulations issued over the prior seven years.
- Require the agencies to report to Congress on modernizing bank supervision
The TAILOR Act has been introduced in previous Congresses and passed the House Financial Services Committee in 2017.
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The Securities and Exchange Commission and Commodity Futures Trading Commission announced separate charges related to digital asset-related fraud. The SEC charged siblings with defrauding thousands of retail investors out of more than $124 million using a digital token worth a fraction of what they claimed. The CFTC charged several defendants with fraud for operating bitcoin-related Ponzi schemes, fraudulently soliciting more than $44 million in investments, and misappropriating millions of dollars. The charges come as Washington debates a broader legal and regulatory framework for digital assets, with the Biden administration expected to issue an executive order on crypto as soon as today. The directive will call on select federal agencies to deliver reports on "the future of money" and boost oversight on digital assets to be better equipped to ward off cyber threats. The order also calls for an assessment of the technological infrastructure needed to issue a central bank digital currency. https://www.americanbanker.com/payments/news/biden-administration-issues-wide-ranging-executive-order-on-crypto Reuters. In a written statement for a Senate hearing last month, ICBA reiterated its call for policymakers to take a comprehensive regulatory approach to digital assets, noting that community bank participation will help mitigate crypto risks
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Several speakers are set for the 2022 ICBA Capital Summit. In keynote remarks and breakout sessions, this year’s speakers will include: Senate Banking Committee member Mike Rounds (R-S.D.); Acting Comptroller of the Currency Michael Hsu; FDIC Acting Chairman Martin Gruenberg, and Assistant Treasury Secretary for Financial Institutions Graham Steele.
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With interchange once again a hot-button issue in 2022, ICBA is reminding policymakers that the Durbin Amendment has distorted financial markets and harmed community banks and consumers, according to a new ICBA blog post. ICBA’s Deborah Matthews Phillips writes that the Federal Reserve Board is proposing to reopen Durbin Amendment regulations governing debit card interchange as merchants push to extend price controls to the credit card market. Pushing Back: “While ‘big box’ merchants continue pressing to expand interchange price controls to boost their profits, policymakers must be reminded that the Durbin Amendment has been a costly and harmful policy for community banks and the consumers they serve,” writes the ICBA and ICBA Bancard payments expert. READ MORE
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Midsize and community banks should begin developing thoughtful assessments of their climate risk profiles to avoid a “trickle down” effect of large bank climate risk management expectations, Acting Comptroller of the Currency Michael Hsu said. In public remarks, Hsu said “it will be a number of years before OCC examiners conduct climate risk management examinations” on midsize and community banks, so these institutions should “use the time wisely.” In a comment letter last month responding to the OCC’s draft climate principles for large banks, ICBA urged the agency to avoid a one-size-fits-all climate approach and expressed concerns that examiners could eventually apply the framework to community banks—which Hsu’s remarks appear to validate. ICBA has also issued a position paper on the potential impact of new climate change regulations on community banks. In his speech, Hsu also said:
- The OCC is laser-focused on the safety and soundness aspects of climate change risks.
- The OCC this year plans to finalize its draft principles for managing climate-related financial risks at OCC-supervised institutions with more than $100 billion in assets.
- The agency plans to develop more detailed interagency guidance that it will apply after “an appropriate transition period.”
- Diversity and inclusion at banks and banking regulators improve outcomes.
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ICBA expressed strong support for an amendment to Senate postal-reform legislation to clarify that the bill does not permit the U.S. Postal Service to offer financial services. Offered by Senate Banking Committee Ranking Member Patrick Toomey (R-Pa.), the amendment to the Postal Service Reform Act of 2022 (H.R. 3076) says no provision of the act may be construed to permit postal banking. In a letter, ICBA encouraged senators to approve the Toomey amendment and oppose any amendment that would authorize USPS to offer financial services. The Senate on Monday voted to limit debate on the bill, setting up potential consideration of amendments and a final Senate vote as soon as this week. A three-part series of ICBA issue briefs delivered to policymakers last year explores the flaws in postal banking proposals and offers alternatives for reaching the unbanked.
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ICBA reiterated its support for bipartisan legislation to close the industrial loan company loophole and urged House members to co-sponsor the bill. Sponsored by Reps. Jesús “Chuy” García (D-Ill.) and Lance Gooden (R-Texas), the Close the ILC Loophole Act (H.R. 5912) would remove the Bank Holding Company Act’s exemption of ILCs from the definition of “bank,” thereby permanently closing the ILC loophole. In a letter to the sponsors and other House Financial Services Committee members, ICBA said commercial entities seek ILC charters to provide financial products and services while avoiding regulatory supervision—contrary to longstanding U.S. policy separating banking and commerce. ICBA also offers a comprehensive white paper detailing why policymakers should close the ILC loophole.
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REMINDER: Registration is open for the 2022 ICBA Capital Summit May 1-4 in Washington, D.C. This year’s Capital Summit will bring community bankers from across the country to Washington to interact with leading policymakers and to advocate for our priorities. Learn more. The House will not be in session that week, while the Senate will be. IBANYS is working to coordinate a combination of virtual and in-person “hill” meetings with key New Yorkers on the Financial Services, Small Business, Agriculture, Energy, Homeland Security, Labor, Budget and Ways & Means Committees, as well as with Senators Schumer and Gillibrand. . Stay tuned for more details. Meanwhile, everal speakers are set for the 2022 ICBA Capital Summit. In keynote remarks and breakout sessions, this year’s speakers will include: Senate Banking Committee member Mike Rounds (R-S.D.); Acting Comptroller of the Currency Michael Hsu; FDIC Acting Chairman Martin Gruenberg, and Assistant Treasury Secretary for Financial Institutions Graham Steele.
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