Tennessee Bankers

This Week Newsletter



May 16, 2016 - Issue No. 1620


TBA Washington Conference Recap

TBA last week hosted a successful Washington Conference with over 80 bankers, associate members, and TBA staff participating. During the conference, the group heard from FDIC Vice Chairman Tom Hoenig and key staff from the Federal Reserve, the OCC, and CFPB. Attendees also visited with Tennessee's Congressmen and Senators Corker and Alexander as well as representatives from national trade groups—ABA, CSBS, and ICBA. View the photo recap of the 2016 Washington Conference.
 
The Tennessee delegation spent their time in DC advocating for key legislative and regulatory issues, including mortgage relief, tailored regulations, data and cyber security and level playing fields with farm credit and credit unions. Tennessee's lawmakers were supportive of bankers' issues and seemed optimistic that regulatory relief in some form will be achievable after the 2016 Presidential election.
 
The Tennessee coalition also pushed for relief from the regulatory agencies, citing specific examples of how regulations are hindering their ability to serve their customers. The group focused on fair lending, TRID compliance, exam issues, and pending restrictions on small-dollar lending and arbitration.

Treasury Proposes Stronger Oversight of Online Lenders

While online marketplace lenders are subject to many of the same rules as banks for loan originations, marketplace lenders receive less direct oversight, the Treasury Department said last Tuesday, May 10, in its long-awaited report on the marketplace lending industry. The Treasury found that providing more "effective oversight" of nonbank lenders could lead to greater transparency and "better outcomes for borrowers." 

However, the Treasury's report also suggests that Congress should enact consumer-style protections for small business loans of less than $100,000, which could have unintended consequences on access to credit. 
 
Other Treasury recommendations include developing industry standards for nonbank lenders on handling servicing and delinquencies, creating a private-sector registry for online lenders' capital markets activities and partnering with community development financial institutions. The Treasury also recommended that the federal government continue to open up data to support marketplace lenders' underwriting decisions and convene an interagency working group to coordinate policy actions. Click here to read the Treasury report.

Treasury Proposes Stronger Oversight of Online Lenders

While online marketplace lenders are subject to many of the same rules as banks for loan originations, marketplace lenders receive less direct oversight, the Treasury Department said last Tuesday, May 10, in its long-awaited report on the marketplace lending industry. The Treasury found that providing more "effective oversight" of nonbank lenders could lead to greater transparency and "better outcomes for borrowers." 

However, the Treasury's report also suggests that Congress should enact consumer-style protections for small business loans of less than $100,000, which could have unintended consequences on access to credit. 
 
Other Treasury recommendations include developing industry standards for nonbank lenders on handling servicing and delinquencies, creating a private-sector registry for online lenders' capital markets activities and partnering with community development financial institutions. The Treasury also recommended that the federal government continue to open up data to support marketplace lenders' underwriting decisions and convene an interagency working group to coordinate policy actions. Click here to read the Treasury report.

OCC Issues New Handbook on Private Student Lending

The OCC last Monday, May 9, added a new booklet on private student lending to its Comptroller's Handbook. The booklet provides examples of acceptable practices and policies for banks engaging in private educational lending, including in-school deferment; providing a six-month grace period and extended grace periods immediately after graduation or withdrawal from school; and loan modifications for long-term hardships.

The booklet also highlights the differences between federal and private student loans and includes guidance for examiners on assessing the risks associated with private student lending. Click here to read the report.

FinCEN Issues Final Customer Due Diligence Rule

The Financial Crimes Enforcement Network has released the text of its long-awaited final customer due diligence rule, which will require banks to collect information on beneficial owners when an account is opened, using the model form included with the rule or taking other steps to collect the same information. A beneficial owner is an individual who owns more than 25 percent of the equity interests in a company or is the single individual who exercises control. The bank must use Customer Identification Program procedures to verify the identity of beneficial owners, although when documentation is used, the bank can rely on copies. The rule allows banks to rely on information provided by the customer, and it also includes a number of exceptions from coverage.

Although the actual rule will be effective July 11, compliance is not mandatory until May 11, 2018.

As a companion to the rule, the Treasury also sent a letter to House Speaker Paul Ryan encouraging the adoption of legislation that would require companies to disclose beneficial ownership information to the states at the time the company is created. Click here to read the final rule. Click here to read the Treasury letter.

Compliance Alliance Hot Topic Question

Q: If a borrower doesn't qualify for a loan under the ATR rule, can we rely on a guarantor's income?
A: No, you may not use a guarantor's income to qualify a loan under the ATR rule. Under the ATR rule, you have to consider the "borrower's" ability to repay a loan (12 CFR 1026.43), and the guarantor is not considered a borrower under the ATR rules. The creditor can only rely on the borrower's and any co-borrower's income and assets to document ATR.
 
Compliance rules and regulations change quickly! Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, participate in a weekly live membership demo, call 888-353-3933 or email info@compliancealliance.com..

New TBA Women in Banking Conference Announced

This fall TBA will host its inaugural Women in Banking Conference designed to bring together Tennessee's many successful female bankers for professional development and networking. A steering committee is hard at work putting together a productive program and sponsorships opportunities are available. Save the date of September 8 to attend in Nashville. To inquire about associating your brand with this event, please contact Susan Taylor. Sponsorships are limited and available at varying rates.  

Investors Title Recognized as Top 25 Best-Run NC Public Company

TBA Endorsed Partner, Investors Title is ranked as one of the top 25 best-run public companies in North Carolina by the Triangle Business Journal. To determine the list, a team of Triangle Business Journal researchers and the Kenan Institute of Private Enterprise at UNC-Chapel Hill evaluated several factors including stock return, employee growth, operational efficiency, and revenue growth.
 
Investors Title Company's Tennessee subsidiaries, Title Center of the South and Bankers Title of East Tennessee, underwrite and issue title insurance policies. The Company also provides investment management services and services in connection with tax-deferred exchanges of like-kind property.
 
Investors Title Company is publicly traded on the NASDAQ exchange under the ticker symbol ITIC. For more information about working with one of the Tennessee agencies, contact Wanda Elmore

Deadline Approaching to Order Bankers Directory

The 2016/2017 Bankers Directory is a compact, handy reference that puts information about all of Tennessee's commercial banks and trust companies at your fingertips. The directory contains complete financial data for Tennessee institutions taken from the 2015 year-end FDIC Call Reports, including:

  • "Statement of Condition"
  • Main address and phone numbers
  • Officers and Directors
  • Branch locations

 The directory also contains:

  • TBA officers, directors, and staff
  • National banking associations and regulatory agencies
  • Tennessee's state legislators and US congressional delegation
  • TBA–endorsed partners and associate members, complete with a brief description of their product or service.

CEOs, out-of-county main office branches, and associate members each receive one complimentary copy of the directory.  Additional copies are available for purchase.
 
The deadline to order this valuable resource is July 15. Click here to order your copy of the 2016/2017 Bankers Directory online, or download the order form and send the completed form to T'Lanie Luu.

TBA On the Road

  • Stacey Langford visits members in Middle Tennessee.
  • TBA hosts Associate Members for the 2016 Appreciation Picnic.

See where TBA goes while "on the road" by following

@TNBankers or  #TBAontheroad