Tennessee Bankers

This Week Newsletter

July 24, 2017 - Issue No. 1729

TBA, Other State Bankers Associations Urge Congress to Block CFPB Arbitration Rule

TBA and state bankers associations from all other 49 states and Puerto Rico wrote to Senate leadership urging lawmakers to use their Congressional Review Act authority to stop the CFPB's final arbitration rule from taking effect. Under the CRA, Congress has the ability to reject new federal regulations within 60 legislative days of publication in the Federal Register.

The controversial final rule 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.

Members of Congress earlier this week signaled willingness to move forward to overturn the rule. Senate Banking Committee Chairman Mike Crapo (R-Idaho) indicated he would lead the effort, and Senate Majority Leader Mitch McConnell (R-Ky.) also signaled support for moving the process forward. Read the letter.
Additionally, ABA president and CEO Rob Nichols in an op-ed for The Hill last week argued that the rule was anti-consumer and actually "a regulatory windfall to trial lawyers at consumers' expense." "Consumers who prevail in arbitration win 166 times what those who prevail in class actions do," he wrote. "And they get faster relief too—a matter of months, not years." Read the op-ed.

CFPB Proposes Temporary Adjustments for HMDA Reporting Requirements

The CFPB on July 14 issued a proposal to raise the threshold at which banks are required to report data on home equity lines of credit. Under the rule, banks originating more than 100 HELOCs are generally required to report under HMDA. The proposal would raise that threshold to 500 HELOCs for the calendar years 2018 and 2019, giving the CFPB time to determine if it will make the adjustment permanent. Comments on the proposal are due by July 31. Read the proposal.

FDIC Issues Revised Exam Appeal Guidelines

The FDIC last Tuesday, July 18, issued revised guidelines to expand banks' rights to appeal exam decisions and improve consistency with other agencies' appeal processes. Specifically, the revised guidelines allow banks to appeal a determination of compliance with an existing formal enforcement action and a determination to initiate an informal enforcement action. They also modify when formal enforcement actions become unappealable and provide additional Supervision Appeals Review Committee appeal rights.

The FDIC also expressly stated that matters requiring board attention are material supervisory determinations that may be appealed under the guidelines. Read the revised guidelines.

Regulators Issue Proposal to Increase Mandatory CRE Appraisal Thresholds

The federal regulatory agencies issued a proposal to increase the threshold for required appraisals for commercial real estate transactions from $250,000 to $400,000 following an FDIC board meeting. Comments on the proposal will be due 60 days after the notice is published in the Federal Register.

In response to growing concerns over a lack of certified appraisers, the federal banking agencies earlier this year issued a reminder of two existing approaches that institutions can use to address appraiser shortages, particularly in rural areas. The first approach, temporary practice permits, allows state-certified or licensed appraisers to provide services in other states. The second involves a temporary waiver request to use a state-certified or licensed appraiser in situations where a documented appraiser shortage has led to "significant delays" in appraisals on federal related transactions in a specific geographic area. Read the proposal.

The Southeastern School of Banking Photo Album

The Southeastern School of Banking, which has served Tennessee financial institutions since 1939, concluded last Friday, July 21. The week-long school incorporates lectures, class interaction, and home study assignments. Students from both years attend classes at Belmont University. Click here for a photo album.

Welcome TBA Associate Member

TBA welcomes new associate member Cameron Executive Search in the category of staffing services. 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

  • Chairs of Banking from universities across Tennessee will be coming to Nashville to discuss the training and placement of college students for the banking industry.
  • Amy Heaslet travels in Middle Tennessee, visiting with bankers and state legislators.

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