Tennessee Bankers

This Week Newsletter

April 25, 2016 - Issue No. 1617

General Assembly Adjourns

The General Assembly adjourned Friday afternoon after a week of controversy and debate on several significant pieces of legislation. The most notable actions of the week included reducing the Hall Income Tax this year by one percent with a total repeal by 2022; taking the transgender bathroom bill off notice; failing to override Governor Haslam's veto of the bill to make the Bible our state book; and approving $1 million in tax relief for veterans.

One of the final votes of the House was to reject a resolution that would have called for members of the General Assembly to return in May to override any additional bills the Governor may veto. Instead, members voted to adjourn sine die Friday, meaning their next official day of business will be in January 2017.

TBA Government Relations Team Shifts Focus to BankPac, Elections

Now that the General Assembly has adjourned, legislators can begin fundraising for their re-election campaigns. TBA's government relations team will shift focus from lobbying legislation to BankPac—both raising funds from banks and contributing funds to candidates. 
With the majority of legislators facing opposition in the races, bankers are encouraged to send feedback about local elections to Tim Amos and Amy Heaslet. For a list of qualifying candidates in the November elections, click here.

Governor Signs TBA's Condo Lien Legislation

Governor Haslam last Tuesday, April 19, signed TBA's major piece of legislation for the year—SB 2397/HB 2401, which will protect lenders' interest in the event a condominium association forecloses for delinquent dues. 
Current law provides condo associations a super-priority lien, which enables them to foreclose for delinquent dues and extinguish a first lien mortgage if the foreclosure sale does not bring enough to satisfy the lender's first lien. TBA's legislation amends the law to allow condo associations to still foreclose and receive six months of delinquent dues up to one percent of the original amount but provide that the first mortgage would not be extinguished. In the event a lender forecloses, a condo association would receive a payment preference for six months of delinquent dues up to one percent of the original loan amount.
The law will take effect June 1 and apply to any foreclosure action initiated on or after that date.

Governor Signs TBA's Deceased Depositor Legislation

Governor Haslam also signed TBA's legislation (SB 1972/HB 1894) increasing the amount of a check from $2,500 to $10,000 that a bank may negotiate if written to a deceased person when no estate is open or where one has already closed. 
The legislation also increases the amount from $7,500 to $15,000 where, in the case of life insurance, proof of death may be furnished by a photocopy of the death certificate, and increases the amount from $10,000 to $15,000 that a bank may pay from a deceased depositor's account to a personal representative or to pay funeral or medical expenses when there is no executor of the estate.
The law took effect upon the Governor's signature on April 14.

Fed Launches Off-Site Reviews for Loan Records

The Federal Reserve last Tuesday, April 19, announced that the banking organizations it supervises under $50 billion in assets may elect to have Fed examiners review loan files off-site, provided the bank can transmit readable and comprehensive loan information securely. The move to streamline the exam process is expected to reduce the burden that on-site exams place on the day-to-day operations of community banks.

According to Fed guidance, for banks that have demonstrated their ability to meet the security, imaging, and comprehensiveness requirements, "Reserve Banks should make all efforts to accommodate the request for an off-site loan review." Click here to read more.

TBA's Barrett Discusses ATM Skimming, Consumer Tips with NewsChannel 5

According to a recent FICO report, ATM skimming scams rose more than 500 percent between 2014 and 2015, with most incidents coming from third-party machines. TBA's Colin Barrett spoke with Nashville's NewsChannel 5 about how banks take proactive steps to curtail this fraud and gave consumer safety tips. Click here to watch the video.

ABA Survey Finds QM Lending Dropped in 2015

The percentage of Qualified Mortgages originated by banks declined in 2015, falling to 86 percent from 90 percent in 2014, according to ABA's latest Residential Real Estate Survey released last week. In most cases, bankers reported that borrowers' debt-to-income ratios prevented loans from meeting QM standards.

The survey also found that bankers continue to worry about the effects of regulation on their ability to do business and meet the needs of their customers. Just over half the bankers surveyed reported that regulations are having a moderately negative impact on their business, while a quarter said that the impact was severely negative.

Bankers said they were most concerned about the increased regulatory burden, compliance concerns, including the TILA-RESPA integrated disclosure rule, economic uncertainties and the current interest rate environment. Click here to read the survey.

Visa Speeds Up Chip Card Readers

Visa last Tuesday, April 19, announced the launch of Quick Chip for EMV, a technology enhancement designed to speed up EMV card authorizations to two seconds or less and allow shoppers to dip and withdraw their cards instantly, just as they do with magnet stripe cards. The new offering would eliminate the concerns expressed by many customers—and by merchants who have refused to upgrade to EMV card readers—that chip card authorizations take too long.

Visa is making the Quick Chip specification available free of charge to merchants via their payment processors and acquiring banks. The technology is available now for Visa transactions, but Visa said it will make Quick Chip available to other payment networks to customize. It requires only a software update to the merchant's card terminals or point-of-sale system.

Join Ncontracts for ERM Webinar May 3

TBA's newest endorsed partner, Ncontracts, will present a complimentary webinar, The Intersection of Enterprise Risk and Vendor Management, for TBA member banks on Tuesday, May 3, at 10 a.m. CT. During this webinar, Ncontracts CEO Michael Berman will discuss ways to develop a risk assessment framework that stratifies vendors based on their risk to the organization and consistency with your overall strategic objectives.


Sign up for this free webinar today. Learn more about the Ncontracts products and services endorsed by the TBA.

Deadline Approaching to Register for The Southeastern School of Commercial Lending

May 2 is the last day you can register for The Southeastern School of Commercial Lending at the discounted tuition rate. After that day, the tuition increases by $200. This intensive, one-week school concentrates on all aspects of commercial lending. Students receive over 50 hours of classroom instruction, discussion, and case study. TSSCL takes place May 22-27 at the TBA Barrett Training Center in Nashville. Click here to take advantage of the discounted tuition.

Enroll Your Future Leaders in the Executive Developement Academy

What could be more critical to your institution's long-term health than the cultivation of its future leaders? One of the most important responsibilities a bank executive possesses is identifying and educating these candidates. Developed as a direct result of member feedback, the new Executive Development Academy is a comprehensive 10-month program that challenges perspectives on leadership, develops leadership skills, and changes leadership behavior.
Participants meet three times a year, with sessions on "Knowing Yourself and Knowing the Situation," "Managing People and Managing Performance," and "Leading with Courage and Vision." This program also includes an individual leadership assessment, pre-and post-program surveys, and individual development planning. 
Because of the importance of identifying and training our future banking leaders, the TBA is extending the registration deadline for this program through the end of April. Invest in the future of your bank. Click here to learn more.

TBA On the Road

  • The TBA Young Bankers Division Leadership Convention is underway in Knoxville.
  • Bankers gather Tuesday in Nashville for the FDIC's Banker Outreach Program.
  • Tim Amos and bankers attend ICBA Washington summit.
  • Federal Home Loan Bank hosts its 2016 Annual Stockholder meeting on Wednesday at Gaylord Springs in Nashville.

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

@TNBankers or  #TBAontheroad

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