Tennessee Bankers

This Week Newsletter

February 12, 2018 - Issue No. 1806

Latest News from the General Assembly

Prior to the Feb. 1 bill-filing deadline for members, just over 1,300 bills were filed for consideration during the second session of the 110th General Assembly. And although the first weeks got off to their typical somewhat slow start, the pace of session is quickly picking up as members are doing their best to make this a quick session and adjourn in early April.

TBA’s government relations team spent last week negotiating terms for legislation that would allow for remote notarization in Tennessee. Of concern were provisions in the original version of the bill that would only have allowed for remote notarization of documents containing a nexus to the state, such as real estate in Tennessee, an agreement performable in Tennessee, or creating a debt that is payable at a location in Tennessee. After negotiations with members of the committee and other interested groups, the Chairman delayed hearing the bill to allow time for the drafting and negotiation of one comprehensive amendment that among other things would remove these provisions of concern to TBA.

TBA is also reviewing bills that could be harmful to the banking industry that would ban dormancy fees on open loop gift cards and allow for contesting UCC and real estate liens.

Barrett and Rieniets Call on Congress

TBA President Colin Barrett and GR Chairman Jim Rieniets went to D.C. last Tuesday to visit with the staff of U.S. Senators Corker and Alexander as well as U.S Representative David Kustoff, a member of the House Financial Services Committee. Barrett and Rieniets advocated on behalf of Senate Bill 2155, the bi-partisan regulatory relief bill that is pending in the Senate and expected to move later this month. The legislation treats mortgages held in portfolio as QM, provides HMDA relief, provides appraisal relief for smaller mortgages, increases the SIFI designation, and more.

Also discussed was the letter Senate Finance Chairman Orrin Hatch (R-UT) sent to NCUA Chairman Mark McWatters questioning whether the credit union industry still deserves their taxpayer subsidy. Barrett and Rieniets additionally made the case that Mark McWatters would not be a suitable fit to lead the CFPB considering his efforts to get federal credit unions removed from the CFPB regulation and enforcement.

Rep. Kustoff Questions Secretary Mnuchin on CRA

On Tuesday, Rep. David Kustoff (TN-08) discussed the need to ease regulatory burden on Tennessee banks when it comes to complying with CRA. He discussed a bank in his district that is losing approximately $100,000 a year on a branch that was opened solely for CRA purposes. He also asked Secretary Mnuchin if banks could receive greater CRA credit for financial literacy in their footprint. To watch the discussion on YouTube, click the video or click here.

FASB Approves Tax Reform Accounting Proposal

The Financial Accounting Standards Board last Wednesday approved a highly anticipated proposal for adjusting regulatory capital balances that were affected by the new tax reform law. Companies will be able to apply the final standard, which is expected to be issued publicly in the coming days, to their 2017 reporting results.

Under current tax accounting, the reductions of deferred tax assets and liabilities are recorded entirely within net income, including those applying to items in accumulated other comprehensive income such as unrealized gains and losses on available-for-sale securities. As a result, not only are net income and regulatory capital affected, but this treatment also creates onerous operational burdens to track the related amounts in the future.

While the new standard will not change the impact to net income, the proposed adjustment between AOCI and retained earnings will allow ending regulatory capital to be appropriately stated and also avoid onerous operational requirements to keep track of the amounts that would have been “stranded” within AOCI.

TBA, along with ABA and 51 other state bankers associations, wrote to FASB on Feb. 2 in support of the proposal. Read the proposal.

CFPB Seeks Public Feedback on Enforcement Processes

As anticipated, the CFPB last week issued a request for information seeking feedback from the public on its enforcement processes. The request is the third in a series of requests for public input the bureau has issued following Acting Director Mick Mulvaney’s announcement last month that the CFPB will engage in a broad public feedback initiative to ensure that it is fulfilling its statutory requirement to protect consumers.

Among other things, the CFPB is seeking feedback on how it communicates with subjects of investigations, the length of investigations, the calculation of civil money penalties, the standard provisions in its consent orders, and how it carries out enforcement activities with other state and federal agencies that may have overlapping jurisdiction. Read the RFI.

TDFI's Grissom Recognized as Outstanding State Employee

Last week Governor Bill Haslam recognized Debra Grissom, TDFI’s Chief Administrator of Applications for the bank and credit union division as one of 22 state employees selected by their department’s leadership to receive the Governor’s Excellence in Service Award. Presented biannually, the awards are given to employees who are on the forefront of improving how Tennessee state government delivers service. Click here to learn more and see all 22 honorees.

Registration Now Open for Strategic Technology & Operations Conference

TBA's Strategic Technology and Operations Conference, designed for community bank CEOs, CIOs, CFOs, COOs, senior department heads, and senior officers who have strategic planning responsibilities for their institutions, focuses on the community bankers’ technology planning needs. It features nationally-known speakers who are experts in the areas of financial institution technology, as well as technology vendors available on-site to answer questions regarding the latest in financial services technology. Team discounts are available for multiple registrations from the same institution when registering at the same time.

The event takes place April 26 & 27 at the Embassy Suites/Conference Center in Murfreesboro, Tenn.

Click here to register.

Bankers Complete The Southeastern School of Advanced Commercial Lending

Congrats to the 41 students for completing The Southeastern School of Advanced Commercial Lending. TSSACL is an intensive three-day school focusing on new approaches to managing problem loans and portfolio credit risk, commercial real estate lending, and more. Click here to see pictures from the event.

Harland Clarke: Strategies for Moving Mobile Forward

TBA endorsed partner Harland Clarke reports that 50 percent of customers under age 54 and 60 percent of customers under age 34 consider mobile deposit to be a “must have” or “nice to have” feature. The general trend of growing mobile adoption is good news for financial institutions, and one sure way to grow mobile banking is by growing mobile deposit, which can lead to deeper account holder engagement and satisfaction, and greater profitability. Learn more by downloading this white paper from Harland Clarke, Best Practices for Moving Mobile Forward: Using Mobile Deposit to Boost Mobile Growth. Contact TBA’s Harland Clarke representative Keith Potts, keith.potts@harlandclarke.com, for more information on Harland’s products and services.

Welcome Four New Associate Members

TBA welcomes four new associate members this week including Automated Systems in the category of software/computers, NXG Strategies in the category of marketing, The Housing Fund in the category of lending, and Visible Equity in the category of software/computers.

Please learn more about each of these companies by visiting our online directory of associate members and thank them for their support of the Tennessee banking industry through membership.

TBA On the Road

  • The ABA Emerging Leaders Board, chaired by Emily Gray of The Hardin County Bank, meets at TBA Barrett Training Center.
  • Senior Compliance Officers travel to Nashville for their peer forum.
  • TBA wishes each of our members a happy Valentine’s Day! ❤️

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

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