Tennessee Bankers

This Week Newsletter

March 05, 2018 - Issue No. 1809

House Subcommittee to Vote on TBA Legislation

The House Finance, Ways and Means Subcommittee on Wednesday, March 7, will vote to advance TBA’s legislation on public deposits to full committee. The legislation (SB 2684 by Bailey and HB 1707 by Wirgau) will allow banks to pledge out-of-state bonds as collateral for public deposits, if the bonds are AA rated or higher and are “bank qualified.” 

TBA’s government relations team has been meeting with members of the subcommittee and has not encountered any negative feedback. However, we encourage bankers to contact members of the House Finance Committee as well as the Senate State and Local Government Committee, where the bill will be heard the following week, and ask for their support of the legislation. 

For a list of committee members and their contact information: House Finance, Ways and Means Committee and Senate State and Local Government Committee.

Powell: Tailored Regulation Remains a Top Priority for Federal Reserve

Tailoring regulation based on an institution’s size and risk profile is “at the heart of what we’re doing” at the Federal Reserve, Chairman Jerome Powell affirmed last Tuesday during testimony before the House Financial Services Committee. Under his leadership, the Fed will continue to focus on reducing the regulatory burden for community banks, and “without losing any safety and soundness, try to make sure that our regulation is no more burdensome than it needs to be,” he said.

Powell pointed to several steps the Fed has taken in recent months to provide relief for smaller institutions, including reducing the scope and burden of the Call Report, reducing the frequency of exams and simplifying capital requirements, adding that “we’re committed to doing more.”

He also noted that the U.S. economy continues to grow at a solid pace, with GDP posting 3 percent growth in the second half of 2017, unemployment reaching a 17-year low, and inflation running just beneath the Fed’s 2 percent target. He added that the Fed’s ongoing effort to wind down its balance sheet is “proceeding smoothly,” and he continues to anticipate gradual interest rate increases in the coming months. Read Powell's testimony.

Mulvaney Outlines Plans for ‘Mild’ but ‘Certain’ CFPB

CFPB Acting Director Mick Mulvaney last week echoed his previous comments that the bureau will no longer “push the envelope” with respect to enforcement actions, adding instead that he envisions a supervisory body that is “mild” but “certain.”

“We are not going to be pushing the envelope anymore,” Mulvaney said, addressing a credit union industry event in Washington, D.C. “We’re not going to bend over backwards to create ways to sue people just because we have the authority to do so. We’re not going to be legislators—it’s supposed to happen at Congress—and that’s where it’s going to happen. We will be the enforcer.”

Under Mulvaney’s leadership, the CFPB has begun a comprehensive assessment of its core mission, issuing requests for information on a number of topics such as the bureau’s supervisory processes, enforcement activities, and engagement with external parties. He added that going forward, the bureau will seek to protect not just “people who use credit cards” but also “those who provide credit.”

Credit Union CEO: Sen. Hatch Right to Question Large Credit Union Tax Exemption

Nearly a month after Senate Finance Committee Chairman Orrin Hatch (R-Utah) wrote to the National Credit Union Administration questioning the federal tax exemption for the largest credit unions, one credit union CEO last week agreed that the time is now to explore taxation for those institutions.

In an op-ed in American Banker, Rob Taylor, president and CEO of Idaho State University Credit Union in Pocatello, Idaho, echoed Hatch’s concerns about large, multiple common bond credit unions that have been allowed to expand and, in many cases, compete with smaller credit unions. Often, these expansions are harmful to small credit unions “that have stayed true to their original fields of membership,” Taylor said. He added that “the NCUA is contributing to this decline with their laissez-faire approach to overlapping fields of membership.” Read the op-ed.

Join TBA for a Day on the Hill Next Tuesday

Day on the Hill, sponsored by the TBA Young Bankers Division, is scheduled for Tuesday, March 13. It is always an eventful day, and this year there is a strong possibility that TBA’s legislation on eligible collateral for public deposits will be heard in both the Senate and House committees on that day. This TBA event introduces future leaders from banks across the state to the legislative process but also serves as a chance for any banker to spend the day engaging with their lawmakers and members of legislative leadership. Registration is available through Thursday, March 8.

Click here to register.

Mark Your Calendar Now 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.

Click here to register.

Welcome New Associate Member

TBA welcomes new associate member Putnam & Hancock CPAs in the category of accounting. Please learn more about each of our associate member 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

  • Bankers gather in Nashville for The Southeastern School of Consumer Credit.
  • Colin Barrett and TBA Government Relations Chair Jim Rieniets will speak to a group of business leaders on the negative impact of Dodd-Frank on Tennessee banking.

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