Tennessee Bankers

This Week Newsletter

May 22, 2017 - Issue No. 1720

Rep. Kustoff Briefs TN Bankers on Financial CHOICE Act

Last week TBA hosted a conference call with Congressman David Kustoff (R-Tenn.) in anticipation of a House floor vote on the Financial CHOICE Act. Kustoff, a member of the House Financial Services Committee, which approved the legislation in early May, told bankers the House vote will likely occur sometime in June. This will allow proponents of the measure time to educate lawmakers on the 600-page bill that would bring regulatory relief to community banks and repeal the Durbin debit interchange amendment.

Carson Signals FHA Policy Shift on PACE Loans

Housing and Urban Development Secretary Ben Carson signaled last week that the administration may revisit an Obama-era policy on Property Assessed Clean Energy (PACE) loans, a controversial financial product that allows homeowners to pay for energy-efficient retrofitting—such as solar panels and high-efficiency air conditioners—through their property tax assessments.

Guidance issued last year allowed the Federal Housing Administration to approve mortgage and refinance applications for properties with PACE loans outstanding. "We are very, very amenable to adjusting that policy," Carson said at an industry conference. "I'm concerned about it. It really does create a burden and an extra complication." 

TBA has defeated legislative efforts in Tennessee the past three years to authorize local governments to adopt PACE programs. Currently, about 30 states allow such programs. Bankers' primary concerns with PACE loans are that they take priority over first mortgage liens and lack certain consumer protections.

Top Risk Trends for 2017

In the latest free article from the ABA Banking Journal, associate editor Monica C. Meinert examines top risk management trends for banks in 2017. 

Meinert's article covers key risk trends in credit, interest rate, liquidity, operational compliance, reputation and strategic risk. It also highlights challenges from the new Current Expected Credit Loss accounting model, changing deposit behavior, evolving underwriting standards and change management in compliance, among other topics. Read the article.

Compliance Conference Sponsorships Available

The TBA Compliance Conference, August 29-30 at the Marriott Cool Springs in Franklin, gathers 150 compliance officers from banks around the state to hear the latest topics related to the ever-changing regulatory environment. The event features multiple break-out sessions in addition to general sessions over two full meeting days covering a multitude of topics for bankers in the compliance arena. Sponsorships are available and are critical to the event's success. A limited number of tabletop exhibit spaces are available. For more information on participating in the conference as a sponsor or exhibitor, please contact Stacey Langford.

WannaCry: Stop What You're Doing and Patch Your Computers

WannaCry (also known as WannaCrypt, WanaCrypt0r, wCry, etc.) is the biggest malware event the Internet has ever seen. This version of ransomware is the prophetic fulfillment of all those fire-and-brimstone IT folks who have been saying there will be a global malware epidemic. WannaCry is called a "weapon of mass destruction," and while that may be a bit extreme, all the "patch or perish" warnings issued are 100 percent accurate. Learn more about the malware and how to defeat it in this article by Jon Waldman with TBA's provider of cyber-security education certifications, the SBS Institute.

Register Now for Senior HR Forum

In the Senior HR Forums, those responsible for human resource-related issues in their institutions have the opportunity to discuss their concerns and explore collaborative solutions to problems they face on a day-to-day basis. It is facilitated by C. Eric Stevens of Littler Mendelson, PC, the country's largest law firm devoted exclusively to representing management in employment and labor law matters. 
The next Forum takes place on June 27 at the TBA Gilliam Board Room in Nashville. For more information or to sign up, click here, or contact Debbie Brickles

SIGNiX Launches TBA Partner Webpage

TBA endorses Chattanooga-based SIGNiX as a trustworthy e-signature solution within the banking industry. SIGNiX provides a powerful, flexible digital signature API solution to Tennessee banks, which can save thousands of hours and dollars in executing important documents with customers. TBA chose SIGNiX because of its dedication to providing legal and valid, pure digital signature technology that allows documents to be verifiable long-term. Now by clicking here, TBA members can easily access current news, information and resources related to e-signature in banking and the SIGNiX/TBA partnership.

FPSI This Week: Are You Managing Your Foreclosed Property Risk?

Are you managing your foreclosed property risk? The lack of day-to-day activity within unoccupied properties makes them a prime target for maintenance and crime-related losses that need to be considered. Below are some risk mitigation ideas that can help you manage this risk to your bank.
  • Make someone accountable. A key element to successfully controlling the exposures that foreclosed properties impose on a financial institution is to designate an individual to accept responsibility and be accountable for monitoring/maintenance.
  • Check in with your insurance providers. Your insurance advisor can review the existing property policy and recommend the proper coverage, and also help identify the specific hazards and provide additional risk management suggestions.
  • Regularly inspect the property. Conducting a regular walk-through of any vacant properties is essential, on a weekly basis for lower value, lower hazard facilities, and, every one or two days, for higher value, higher hazard facilities.
  • Keep detailed records. Individual files should be created for each foreclosed property, documenting initial property condition, inspections and all maintenance performed. 
Interestingly, vacant properties can sometimes expose owners to more hazards than those that are occupied. Financial institutions need to consider how to manage vacant properties already in their portfolios, and plan for the possibility that there may be more to come. 
For more information, please contact FinancialPSI's Jon Goodson or Ted Frizen.

TBA On the Road

  • Graduate School of Banking at LSU kicks off in Baton Rouge with 69 Tennessee students attending.
  • TBA hosts its annual State Association Reception at the Graduate School of Banking at LSU.
See where TBA goes while "on the road" by following @TNBankers.