Tennessee Bankers

This Week Newsletter

January 29, 2018 - Issue No. 1804

Mulvaney: CFPB's Days of 'Pushing the Envelope' Are Over

The CFPB’s prevailing governing philosophy of “pushing the envelope” in the name of enforcing consumer protection laws will shift under the bureau’s new leadership, Acting Director Mick Mulvaney said last week in a memo to CFPB staff that was later published as a Wall Street Journal op-ed.

“It is not appropriate for any government entity to ‘push the envelope’ when it comes into conflict with our citizens,” Mulvaney said, referencing a statement made by former CFPB Director Richard Cordray in a press interview. He added that the CFPB’s aggressive approach to court actions can have wide-reaching negative consequences for individuals’ jobs, finances, and homes. “If a company closes its doors under the weight of a multiyear Civil Investigative Demand, you and I will still have jobs at the CFPB,” he wrote to bureau staff. “But what about the workers who are laid off as a result? Where do they go the next morning?”
Looking ahead, Mulvaney said that the bureau will pursue enforcement actions only in cases where there is “quantifiable and unavoidable harm to the consumer.” It will also engage in more formal rulemaking and less regulation by enforcement, prioritize its actions based on the consumer complaints it receives, and use quantitative analysis to consider the costs and benefits of its rules on consumers and institutions, instead of relying on qualitative data. Read the memo.

Senate Confirms Powell as Next Fed Chairman

By a vote of 85 to 12, the Senate last Tuesday voted to confirm Federal Reserve Governor Jerome Powell as the 16th chairman of the Fed. Powell first joined the board in 2012 and has played a major role in bank supervision and payments system activities during his tenure. Powell will take over when Chairwoman Janet Yellen’s four-year term as governor ends Feb. 3.

TDFI's Gonzales Testifies Before House Committee

Commissioner Greg Gonzales of the Tennessee Department of Financial Institutions testified last Tuesday before the House Insurance and Banking Committee. Although his testimony focused on the department's fiscal year 2018-2019 budget, he spoke on an array of topics, including the overall strength of Tennessee's financial institutions and praised them on their ability to recover from the financial crisis by addressing asset quality and re-instilling confidence again in consumers.
Gonzales also emphasized the department’s need to retain experienced examiners, their efforts to work with banks and other financial institutions to address financial exploitation of the elderly, and their partnership with the state Treasurer’s office to promote financial literacy efforts in schools across Tennessee.

State Legislative Update

With the bill filing deadline set for this Thursday, Feb. 1, TBA continues to review bills as they are filed. TBA’s priority legislation will be, subject to approval of the Tennessee Collateral Pool Board, to allow banks to pledge as collateral for public deposits bonds issued by other states and other states’ municipalities. The board is scheduled to meet Friday, Feb. 2, where members will discuss allowing out-of-state bonds as collateral.
TBA will also be involved in legislation that seeks to allow for remote notarization through online means and to authorize the use of blockchain technology and smart contracts. An informational hearing was held last week before the House Business and Utilities Committee to educate members on blockchain technology and the benefits it offers to certain industries, including the banking industry.

Credit Conference Covers Array of Lending Topics

TBA’s Credit Conference, held in Nashville February 22 & 23, is quickly approaching. Early registration and team discount pricing for the conference ends Feb. 7. 

Under the leadership of committee chairman Monte Jones, the Credit Committee has put together a robust agenda that hits on every timely lending topic facing Tennessee bankers in 2018. Workshop topics include: navigating a tightening rate cycle, challenges from the cyber domain, real estate valuation in today’s marketplace, and risk management for agriculture and CRE lending. Attendees will also hear from representatives from each of the regulatory agencies who specialize in lending and credit.

Register today to reserve your spot in the largest Tennessee banking conference of the year.

Compliance Alliance Hot Topic Question

Ease your compliance burden in 2018 by learning more about the tools and resources available through joining Compliance Alliance. Attend a live webinar demo this week: Tuesday, Jan. 30, 10 am CST or Thursday, Feb. 1, 1 pm CST.

Q: Do risk-based pricing notices have to be provided to applicants who are denied?     
A: No—if an application is denied and an adverse action notice is provided, a risk-based pricing notice or exception notice is not required. See Regulation V, section 1022.74(b): (b) Adverse action notice. A person is not required to provide a risk-based pricing notice to the consumer under §1022.72(a), (c), or (d) if the person provides an adverse action notice to the consumer under section 615(a) of the FCRA. Read more.

Section 1022.72(a) of the regulation specifies when the bank generally must provide a risk-based pricing notice to a consumer applying for credit, which is subject to the exceptions set out in section 1022.74.7.

Post Open Positions in TBA's Job Bank

As a benefit of membership, Tennessee banks and TBA associate members may list open positions in the Tennessee Bankers Association online job bank free-of-charge. The job bank is one of the most visited portions of the TBA website: www.tnbankers.org/job-bank. If you are interested in placing an ad please contact Penny Powlas.

TBA On the Road

  • CEO Forums meet in Nashville for the first of three sessions in 2018.

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