Tennessee Bankers

This Week Newsletter



January 15, 2018 - Issue No. 1802


Tennessee's 110th General Assembly Re-Convenes

State House and Senate members reconvened last Tuesday, Jan. 9, for the second session of the 110th General Assembly. As expected, leaders and members on both sides of the aisle seem determined to have a quick session so they can return to their districts and focus on the upcoming elections. 

Lt. Governor Randy McNally announced last Wednesday the Senate’s goal of adjourning by the second week of April, and Speaker Beth Harwell announced changes in how legislation flows through House committees to the floor in an effort to expedite a bill’s passage or defeat.

Although all members seem in agreement on a goal of early adjournment, this session will also be marked with some political grandstanding. Already on the House floor, members have raised controversial issues such as affordable healthcare and guns being allowed in the Cordell Hull Building, the new legislative offices building. 

Aside from those issues, lawmakers may also tackle issues ranging from workforce development, enhancing technical training in high schools, allowing liquor sales on Sundays, to addressing the opioid crisis.

2018 State Legislative Outlook for TBA

TBA's government relations team is finalizing details of the association's legislative agenda for the year. The Association expects to file only one bill this year, which would allow banks to pledge as collateral of public deposits bonds issued by other states and other states’ municipalities. TBA will pursue legislation to achieve this pending approval of the state Treasurer’s Office and the Tennessee Bank Collateral Pool Board. 

Other issues TBA will work with other groups on are establishing a boat title system in Tennessee and allowing for electronic notarization of documents through “online appearance.”

Another priority of TBA will be opposing legislation, if filed, that would authorize local governments to enact property assessed clean energy (PACE) programs. The legislation has been brought by various groups over the past several years and may come up again this year as Tennessee is in the minority of states that has not approved this measure. TBA's core concern with the measure is that it would put local governments in the lending business by allowing them to use their bonding authority to finance these PACE loans.

We will continue reporting on these and other bills of interest throughout this session. You can also receive more detailed updates on banking-related bills by participating in TBA's bi-weekly legislative update conference calls. The next call is scheduled for Friday, January 26. Please contact Penny Powlas if you would like to join the calls.

Judge’s Ruling Keeps Mulvaney in Place at CFPB

CFPB Acting Director Mick Mulvaney will continue to serve in that capacity after a federal judge last week denied CFPB Deputy Director Leandra English’s request for an injunction stating that she is the rightful acting director. U.S. District Judge Timothy Kelly said that English was not likely to win on the merits of the case.

Mulvaney was appointed acting director under the Federal Vacancies Reform Act, which allows the president to name a currently serving Senate-confirmed official as acting director for a set period of time or until a permanent director is confirmed. Named deputy director shortly before Richard Cordray’s resignation in November, English sued Mulvaney and Trump on the theory that the Dodd-Frank Act makes her the bureau’s acting director during a vacancy.

In denying the request for an injunction, Kelly found that the Dodd-Frank language did not override the president’s powers under the FVRA and thus that English’s claim was not likely to be granted. The ruling leaves in place the status quo, with Mulvaney—also serving as director of the Office of Management and Budget—working three days a week at the CFPB.

Selling Out! TBA’s Most Popular Events

TBA’s two most anticipated and highly attended events, which sell out every year, are open now for registration and hotel reservations. Don’t delay and miss out on Credit Conference, Feb. 22-23 in Nashville, or Annual Meeting, June 17-19 in Colorado Springs at The Broadmoor. Information about the schedule of events and hotel room blocks can be found online at the links below.

Click here to register for Credit Conference.

Click here to register for Annual Meeting.

Compliance Hot Topic Question

Ease your compliance burden in 2018 by learning more about the tools and resources available by joining Compliance Alliance. Attend a live webinar demo this week. Live demo on January 16th at 10 a.m. CT. Live demo on January 18th at 1 p.m. CT.

Q: What additional requirements do we have after issuing an LE if the applicant never responds?

A: There are no additional requirements for Regulation Z after you issue the LE if the applicant never indicates an intention to proceed with the loan. However, Regulation B (ECOA) requirements are not met simply by issuing an LE. Regulation B requires the lender to respond to the applicant within 30 days of receiving the application or taking adverse action on an incomplete application. 

If the application is incomplete, the lender must either notify the applicant that the application is incomplete within 30 days of receiving the application or provide an adverse action notice within 30 days of taking the adverse action on the incomplete application. If the application is complete, the lender must communicate to the applicant within 30 days that the loan was approved (this can be express or implied), was denied (adverse action notice), or make a counteroffer. If a counter offer is made, the lender must notify the applicant of action taken within 90 days of making the counteroffer if the applicant does not expressly accept or use the counteroffer. For more details, click here.

Ncontracts Webinar: Top 10 Things to Consider for an Effective BCP Plan

Join TBA endorsed partner Ncontracts for this complimentary, timely webinar Thursday, January 25 at 2 p.m. CT. How’s your financial institution’s business continuity plan? Are you certain its current and comprehensive? Given the rough past few months of weather and fire calamities, now’s a good time to go back to basics in considering the state of your BCP plan. On the free webinar Ncontracts will explore 10 fundamental steps necessary to ensure that you’re structuring your BCP program in the most effective format. Register here.

Financial PSI This Week: ERISA Compliance

The Employee Retirement Income Security Act (ERISA) is a federal law that sets minimum standards for employee benefit plans maintained by private-sector employers. ERISA includes requirements for both retirement plans (for example, 401(K) plans) and welfare benefit plans (for example, group health plans). ERISA has been amended many times over the years, expanding the protections available to welfare benefit plan participants and beneficiaries.

The Department of Labor, (DOL), through its Employee Benefits Security Administration (EBSA), enforces most of ERISA’s provisions. Violating ERISA can have serious and costly consequences for employers that sponsor welfare benefit plans, either through DOL enforcement actions and penalty assessments or through participant lawsuits.

DOL audits of employee benefit plans are on the rise. These audits often focus on violations of ERISA’s fiduciary obligations and reporting and disclosure requirements.

Is your bank ERISA Compliant? If you are not sure, please contact Jon Goodson or Ted Frizen.

Welcome New TBA Associate Member

TBA welcomes new associate member Community Bank Real Estate Solutions in the category of appraisals, bringing the count to 209 TBA Associate Members. Please thank this company for their support of the Tennessee banking industry through membership. When evaluating vendor partners, review the list of all TBA associate members in our online directory.

2018 renewals for Associate Membership are currently underway and close February 1. Members can renew online here.

Find Out How You Can Get the Most Value Out of Your TBA Membership in 2018

From continuing education to monitoring state and federal legislative agendas, the Tennessee Bankers Association is here for you. With the New Year upon us, we asked TBA staff, how do you recommend members engage with the Association in 2018? Click here to read their responses.

TBA On the Road

  • The General Assembly returns for the second week of the 2018 Legislative Session after observing Martin Luther King Day.
  • Colin Barrett will speak to the Mt. Pleasant Rotary on Wednesday.

See where TBA goes while "on the road" by following @TNBankers.