In This Issue

• ABA-Backed Data Security Bill Advances by Strong Margin
• ABA Keeps Up Full Court Press on Reg Relief
• House Members Oppose Controversial Section of Cyber Bill
• Fed to Review Check Image Service Fee
• FDIC Updates Compliance Examination Manual
• Date Set for 2016 Dakota School of Lending Principles

ABA-Backed Data Security Bill Advances by Strong Margin

The House Financial Services Committee yesterday voted by a strong 46-9 margin to advance the bipartisan Data Security Act (H.R. 2205), introduced by Reps. Randy Neugebauer (R-Texas) and John Carney (D-Del.), which would establish a national data security and breach notification standard for financial institutions and retailers.

ABA welcomed the bill, which is part of the association’s Agenda for America’s Hometown Banks. The bill “would increase protections for consumers by ensuring all entities that handle sensitive financial data have a robust process to protect data in place,” said ABA EVP James Ballentine. “This would go a long way toward stopping breaches before they occur.”

Like a similar Senate bill introduced by Roy Blunt (R-Mo.) and Tom Carper (D-Del.), H.R. 2205 models its security and notification requirements on the rigorous standards already in place in the financial industry under the Gramm-Leach-Bliley Act and recognizes that financial institutions do not need a duplicative set of requirements.

The bill would replace state laws with a single set of national data security requirements that are scalable to accommodate the needs of smaller businesses. It would require a company experiencing a breach to notify all affected customers, as well as federal agencies, law enforcement and consumer credit agencies when a breach affects more than 5,000 individuals.

The committee also voted yesterday by 33 to 21 to approve the ABA-supported H.R. 3791, which would expand the relief offered under the Federal Reserve’s small bank holding company policy statement to institutions with assets under $5 billion, up from the current $1 billion. H.R. 3791 was sponsored by Rep. Mia Love (R-Utah) and expands on congressional action at the beginning of 2015 to raise the threshold from $500 million in assets.

ABA Keeps Up Full Court Press on Reg Relief

 
Just two days remain before a government spending bill is due, which remains the best chance to see meaningful bank regulatory relief enacted this year. ABA continues to encourage all bankers to call, email and tweet their senators -- even if they already have done so -- urging them to include Sen. Richard Shelby’s reg relief bill in the spending bill.

Members of ABA’s Government Relations Council and Community Bankers Council visited their lawmakers on Tuesday, urging them to support reg relief. Conversations with lawmakers indicated the need for all bankers to continue a full court press this week for reg relief.

• Call your senators.
• Email your senators.
• Tweet your senators.

House Members Oppose Controversial Section of Cyber Bill

 
Seventy-five House Republicans and Democrats -- including the chairmen of the committees on energy and commerce, financial services and science and technology -- wrote to leaders of the congressional intelligence committees yesterday opposing the controversial Section 407 of the Cybersecurity Information Sharing Act passed by the Senate.

Section 407 would require the Department of Homeland Security to develop a cybersecurity strategy for certain private-sector businesses, which ABA has said would amount to giving DHS authority to regulate large financial firms. “This is backdoor regulation at its worst and is counterproductive to the underlying goals of the bill,” the House members said. “[T]he information sharing framework built by this legislation is voluntary and free of burdensome government mandates and regulations.”

Noting that Section 407 was included without hearings or debate, the House members urged lawmakers currently reconciling different versions of bills passed by both the House and Senate to leave it out of the final version of the legislation. ABA urged the same in a letter late last week. Read the congressional letter. Read ABA’s letter.

Fed to Review Check Image Service Fee

 
On Monday, in response to requests by ABA and others in the payments industry, Federal Reserve Governor Jerome Powell said the Fed would review the Federal Reserve Banks’ costs associated with anti-money laundering and compliance and determine if any changes to Fed policies, procedures or fee structures are warranted.

ABA and others had earlier requested a full competitive impact analysis of the Fed banks’ check image services to ensure that its pricing does not give it an unfair advantage over private sector operators. Powell declined the request for a full competitive impact analysis, but did direct his staff to review the aforementioned costs. Read Powell’s letter. For more information, contact ABA’s Steve Kenneally.

FDIC Updates Compliance Examination Manual

 
The FDIC updated its Compliance Examination Manual on Friday with new guidance and examples for examiners conducting compliance and Community Reinvestment Act examinations.

The updates include sample templates of examination reports and evaluations for a hypothetical bank evaluated under the intermediate small bank test; new guidance about the Matters Requiring Board Attention section of the Report of Examination; and an “Assessment of Risk of Consumer Harm,” a series of questions to help examiners determine specific areas of focus for a bank’s examination activities.

The revised guide also includes revised exam procedures pertaining to the TILA-RESPA integrated disclosures. Read the manual.

Date Set for 2016 Dakota School of Lending Principles

 
The Dakota School of Lending Principles, hosted by the North Dakota Bankers Association and co-sponsored by the South Dakota Bankers Association, is a learning event with one foot grounded in the classroom and one foot in the bank. This school allows students to learn the theory and process of basic lending and then put this knowledge to work in actual nuts and bolts sessions.

The 2016 Dakota School of Lending Principles will be held March 29 to April 1 at the Radisson Hotel in Bismarck, N.D. The school provides basic instruction appropriate for loan officer trainees, loan support personnel and personal bankers.

To ensure exposure to bank structure and terminology, it is recommended that applicants have a minimum of six months lending experience or one year of loan department experience. Applicants not meeting the suggested prerequisites will be contacted to discuss admission qualifications.

Learn more and register today.