Tennessee Bankers

This Week Newsletter

July 17, 2017 - Issue No. 1728

Rep. Kustoff Presents Reg Relief Bill

Last Wednesday, Congressmen David Kustoff (R-Tenn.) presented legislation designed to benefit community banks to the Financial Institutions subcommittee of the Financial Services Committee. The bill would, among other things, exempt from the appraisal requirement loans that the CFPB considers high-priced mortgage loans (HPMLs) on primary residences that are under $250,000 and held in portfolio for at least three years.
The legislation received favorable feedback from subcommittee members and is hoped to be scheduled for markup prior to the August Congressional recess. Read the bill.

Corker Expresses Optimism for Reg Relief During Call with Tennessee Bankers

Now that the House passed sweeping regulatory relief legislation—the Financial Choice Act—in June, it is up to the Senate to act to ensure regulatory reform makes it to the president's desk for signature. Last Friday, Sen. Corker (R-Tenn.) joined Tennessee bankers on a call regarding progress and prospects of regulatory relief. A member of the Senate Banking Committee, Corker said "it is a privilege to be actively engaged on banking issues" and highlighted the close working relationship between his office and that of Senate Banking Chairman Mike Crapo (R-ID), someone Corker described as "a chairman that wants to accomplish a great deal."
Senator Corker expressed optimism for passage of CFPB structural and budgetary reform and stated that nominee Randal Quarles will be confirmed by the Senate to serve as vice chairman of the Federal Reserve for financial institution supervision, though the timeline for confirmations is difficult to predict. Corker also described his efforts to form a bi-partisan working group to address GSE reform in a more simplified manner than past proposals, with hopes that from there the group could move to other regulatory relief topics.

Congressional GOP Pursuing Votes to Overturn CFPB's Anti-Arbitration Rule

Last Monday, July 10, the CFPB finalized its rule that prohibits customers from waiving their ability to participate in class action suits and limits drastically the use of mandatory arbitration agreements for financial products and services. Banks of all sizes often include mandatory arbitration clauses in their credit card and deposit account agreements in order to manage the unpredictable costs of class action lawsuits and ensure prompt resolution of disputes.

By sharply limiting the usefulness of arbitration clauses, the final rule means that arbitration is likely to disappear in financial services contracts. This will likely impose burdens on customers whose claims cannot be resolved through class actions, instead requiring them to go to court for minor, non-systemic disputes.

However, Republicans in the House and Senate are already taking steps to overturn the final rule under  the Congressional Review Act, which gives Congress the ability to vote to reject new federal regulations within 60 legislative session days of publication in the Federal Register.

While several members indicated their desire to use CRA to overturn the rule, Senate Banking Committee Chairman Mike Crapo (R-Idaho) indicated he would lead the effort. Senate Majority Leader Mitch McConnell (R-Ky.) also signaled his willingness to move forward with the process.
Read the final rule. Read the CFPB's summary.

TBA, Other Groups Call for Extension of HMDA Implementation

TBA, along with state bankers associations from all other states as well as ABA last week called on the CFPB to delay the implementation of the new Home Mortgage Disclosure Act requirements to provide bankers and third-party service providers more time to comply with the complex rule and ensure that consumer data is protected. The rule is set to take effect on Jan. 1, 2018. The groups asked the bureau to announce its intention for a delay within the next month.

The letter noted that the recent proposed changes to the rule have added to its complexity and will require third-party software providers to make additional changes to help banks comply, which would make the Jan. 1 compliance deadline unfeasible. Read the letter.

Trump Names Quarles as Fed Vice Chairman for Bank Supervision

The White House last Monday announced that President Trump will nominate Randal Quarles to serve as vice chairman of the Federal Reserve for financial institution supervision. The position was created by the Dodd-Frank Act but was never filled.

Currently the head of a private investment firm, Quarles was previously a partner at the Carlyle Group, a private equity firm. During the George W. Bush administration, he served as under secretary of the treasury for domestic finance and as assistant treasury secretary for international affairs. He also served as deputy assistant treasury secretary for financial institutions policy in the George H. W. Bush administration.

FDIC Nominee Withdraws

James Clinger – President Trump's recently announced nominee to serve on the FDIC board and, later this year, chair the agency – withdrew from the nomination process last week. He cited family obligations.

Retail Banking Officer Forum Begins Sept. 6

This Retail Banking Officer Forum, which takes place September 6 in Nahville, will provide a platform and opportunity for retail banking officers to exchange ideas freely, examine pressing issues in today's ever-evolving regulatory, cost-conscience, and productivity-driven environment.
TBA is pleased to provide this program where individuals who are responsible for retail banking issues in their institutions have the opportunity to discuss those concerns and explore collaborative solutions to challenges they face on a day-to-day basis.
The Retail Banking Officer Forums will meet three times annually at the TBA headquarters. The agenda for each session will flow based on feedback from participants in the forum group. As necessary, subject matter experts will be brought in to cover specific issues and topics based on responses from the forum members. To learn more, click here.

Don't Miss Compliance Conference

We all are concerned about regulatory requirements from past, present, and future changes. Do you ever feel lost? Don't let compliance be a roadblock for your organization. Negotiating compliance challenges remains a complex, burdensome task with all the sublime smoothness of finding an unknown destination without a GPS. Straighten the regulatory curves with the 2017 Compliance Conference, taking place August 29 & 30 at the Franklin Marriott Cool Springs in Franklin, Tenn. Be a part of the conference and hear from nationally recognized experts, regional, and local regulators on hot topics and examination concerns.
This event gives you the opportunity to discuss your concerns and enjoy sharing and exchanging ideas with others facing the same regulatory changes. Register now—you will not want to miss this year's conference!

Welcome TBA Associate Member

TBA welcomes new associate member Alternative Capital Solutions in the category of lending. Please thank this company for their support of the Tennessee banking industry through membership and when evaluating vendor partners, review the list of all TBA associate members in our online directory.

TBA On the Road

  • Bankers travel to Nashville to begin the 2017 sessions of The Southeastern School of Banking held on the campus of Belmont University.

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

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