Tennessee Bankers

This Week Newsletter

November 07, 2016 - Issue No. 1645

CFPB Clarifies 'Flexibility' in Third-Party Risk Management

The CFPB last Monday, Oct. 31, issued an update to its guidance on risk management for third-party service providers. The update is intended to clarify that entities supervised by the bureau have "flexibility" to "allow appropriate risk management" of these relationships.
Some entities interpreted the CFPB's 2012 bulletin to mean the same due diligence requirements applied to all service providers, regardless of the risk they posed to consumers. Consequently, entities were imposing the same due diligence requirements on small service providers as they were for the largest providers.

The new guidance indicates that the CFPB "expects that the depth and formality of the entity's risk management program for service providers may vary depending upon the service performed—its size, scope, complexity, importance, and potential for consumer harm—and the performance of the service provider in carrying out its activities in compliance with federal consumer financial laws and regulations." Read the CFPB guidance.

Fed Maintains Rates

Federal Reserve officials agreed to maintain a 0.25 to 0.5 percent target range for the federal funds rate at their latest meeting, according to the statement released last week by the Federal Open Market Committee. While the committee acknowledged economic conditions that would warrant an increase were present, they agreed to wait for "further evidence of continued progress."

The FOMC vote to keep rates the same was 8-2, with the dissenting members preferring a rate increase of 50 to 75 basis points. The final FOMC meeting of the year is scheduled for Dec. 13-14. Read the FOMC statement.

Agencies Seeking Comments on Private Flood Insurance Proposal

Federal financial regulators are requesting comment on a proposed rule to amend flood insurance regulations to encourage the growth of a market for private flood insurance.

The proposal would require lenders to accept private flood insurance policies if the coverage satisfies the standards specified in the Biggert-Waters Flood Insurance Reform Act of 2012. Lenders could accept on a discretionary basis private flood insurance that does not meet the statutory definition.

The agencies last year approved a separate flood insurance final rule with an exemption from escrow requirements for institutions with less than $1 billion in assets. That rule establishes requirements for escrowing flood insurance payments and the force-placement of flood insurance.
Comments are due within 60 days. Read the Final Rule with Instructions for Submitting Comments.

Credit Card Market Expands in Second Quarter

New credit card accounts rose 11 percent year-on-year in the second quarter of 2016 to total 84.9 million, according to the latest edition of ABA's "Credit Card Market Monitor" released last week. The total number of credit card accounts continued to climb to a post-recession high of 342 million. Healthy consumer spending and a tightening labor market contributed to the increase.

The report showed that card issuers are continuing to expand access to credit, particularly consumers with lower credit scores or limited histories. The number of new subprime accounts grew by 19 percent to 25 million, while new prime accounts grew by 16 percent and new super prime accounts by 3.3 percent. However, average credit lines for new accounts grew most in the super prime category, at 1.7 percent, while rising only 0.2 percent for new subprime accounts. Read the Monitor.

Bank Security & Risk Management Conference November 17 and 18

The Bank Security & Risk Management Conference, scheduled for November 17 and 18 at the Nashville Airport Marriott, gives both the new and the experienced security officer a critical resource for receiving timely and continuing security education. It provides established and emerging industry-standard security practices, enhances the security professional's credibility with peers and their board of directors, allows you to continue your personal and professional development, and reduces your personal and corporate liability.
This year's program features Carol S. Dodgen, Dodgen Security Consulting, who will address workplace violence, how to prevent these acts, and how to have a plan in place to respond should the unthinkable occur. Dodgen will also address how to use Crime Prevention through Environmental Design (CPTED), principles to make your bank more inviting to customers and less attractive to criminals. The program features FBI Special Agent Scott Augenbaum and Securit360's David Forrestall as they address ways to reduce your risk against threats such as data breaches, how to get your C-suite to understand the threat, how to build a security program that is both secure and compliant, and more.
In today's environment, it is imperative that your bank is prepared to address these situations. To register, click here

Register for 2016 Call Report Program

The instructions and requirements for the Federal Call Report change frequently, with revisions occurring nearly every quarter. The 2016 Call Report seminar will familiarize participants with the details of recent changes. In addition, this seminar serves as a refresher course for the Call Report preparation and addresses related accounting principles and regulatory issues that impact the preparation of the Call Report. Participants will receive a detailed review of the most commonly prepared Call Report schedules, and each participant will have an opportunity to review and revisit the entire Call Report preparation process.
This program takes place Nov. 29 at Nashville's TBA Barrett Training Center. Click here to register.

Learn How E-Signatures Can Benefit Your Bank

Join us December 6th at 11 a.m. EST for a free e-signature webinar hosted by TBA and our newest endorsed partner, SIGNiX. During this webinar you will learn all about e-signatures and their benefits, the key differentiators between different digital signature products, how e-signatures can save your bank time, effort and money and how using e-signatures in your bank reduces risk by increasing security. The webinar will include a live demonstration of how SIGNiX's e-signatures work. To register for the free webinar with TBA's newest endorsed partner, follow this link: https://www.signix.com/webinar-esignatures-for-banking.

Book Your Holiday Event at the TBA Barrett Training Center

TBA Barrett Training Center is the perfect place to book your holiday party this year. From 20 to 200+ guests, let us do the planning for you. Whatever your specific event needs are, we have the building and spaces to fit your event. Our rooms are suitable for events ranging from small 12-person board meetings to cocktail style receptions for 300. For more information, click here or contact Sandra Johnson.

TBA On the Road

  • Stacey Langford visits members in West Tennessee.
  • Tim Amos speaks to UTK finance class and meets with Knoxville bankers.
  • Colin Barrett speaks at KraftCPA's Bankers Brew event in Nashville.

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