SDBA eNews: February 2, 2017

In This Issue

State Regulators Release BSA/AML Self-Assessment Tool


State regulators and the Conference of State Bank Supervisors have released a new voluntary self-assessment tool to help banks better manage Bank Secrecy Act and anti-money laundering risk.

The tool is meant to help institutions better identify, monitor and communicate BSA/AML risk, reduce uncertainty surrounding BSA/AML compliance and foster greater transparency within the industry. Learn more and access the tool.


SDSU to Host Presentation on the Minneapolis Plan to End Too Big To Fail


Ron Feldman with the Federal Reserve Bank of Minneapolis will present "The Minneapolis Plan to End Too Big To Fail" at South Dakota State University in Brookings on Feb. 13.

Feldman is executive vice president and senior policy advisor at the Federal Reserve Bank of Minneapolis. He is the senior officer for supervision, regulation and credit, where he oversees the consumer and safety and soundness supervision of about 75 state member banks and about 500 bank holding companies.

Feldman is also responsible for the bank’s lending to Ninth District depository institutions and managing the resulting credit risk.

The presentation will be held at 7 p.m. at the SDSU Performing Arts Center, 1601 11th St. The free event is sponsored by the SDSU Department of Economics. For more information, contact Dr. Joseph M. Santos.


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Vendor Materials Now Available for 2017 Quad States Convention

 
Banking Beyond Borders: We're not in Kansas anymore! Vendor materials for sponsoring, exhibiting and advertising are now available for the BANKING BEYOND BORDERS: 2017 Quad States Convention June 4-6 at the Rushmore Plaza Civic Center in Rapid City, S.D.

Hosted by the South Dakota Bankers Association, this year’s event will include bankers from South Dakota, North Dakota, Montana and Wyoming—we’re not in Kansas anymore!

There are many reasons to support this outstanding event. Vendors will have the opportunity to promote their products and services, position their solutions with top-level bank executives, show their support for the banking industry, interact with association members and celebrate their achievements.

Those who confirm their convention sponsorship by March 1, 2017, will be listed in the pre-convention marketing flier, which will be mailed to all banks, branches and associate members in late March.


Fed Revises Capital Planning Requirements for Banks Under $250B

 
The Federal Reserve on Monday issued a final rule that will exempt many regional banks from the complex qualitative requirements of its annual Comprehensive Capital Analysis and Review, or CCAR, process. The rule takes effect for the 2017 CCAR cycle--which began on Jan. 1--for bank holding companies with between $50 billion and $250 billion in assets. CCAR instructions and scenarios for 2017 will be released later this week.

As the American Bankers Association recommended in its comment letter, the Fed offered additional clarity on the supervisory review process, specifying that it plans to conduct its reviews “in a manner similar to existing supervisory programs,” including a “first day letter” in advance and sufficient lead time to provide information and address findings. The Fed also said it will provide large and noncomplex firms with “several months’ advance notice” of focus areas in the capital plan.

While welcoming this refinement of the stress test program for those banks affected by the rule, ABA will continue to encourage the Federal Reserve to consider expanding these reforms to other banks.


Trump Issues Order Aiming to Contain Cost, Volume of Regulations

 
President Trump issued an executive order on Monay aiming to restrain the growth in regulatory costs and volume. The order would require a net incremental budgetary cost of zero or less for most new regulations while also requiring agencies in most cases to identify two regulations to be rescinded for every new one issued.

While the language of the order is not specific about what agencies are covered, news services reported Monday that a White House spokeswoman said that independent regulatory agencies--including most financial and banking regulators--would be exempt.

Effective immediately, most executive departments and agencies will be required to maintain a total incremental budgetary cost of zero or less for all finalized regulations, unless required by law or approved by the director of the Office of Management and Budget. When proposing a new rule, an agency must identify two existing regulations to be rescinded, and it must offset new regulatory costs by eliminating the same costs from at least two regulations.

Starting with fiscal year 2018, the rule establishes an outline for a “regulatory budget,” with OMB providing each agency a total incremental cost cap on regulations in the upcoming fiscal year; agency heads will be required to avoid exceeding the cap and, in cases where a reduction in total regulatory costs is required, rescind or rewrite rules to meet the lower cap.

The order directs OMB to provide further details on how the order will be implemented and how costs will be accounted for. It also exempts regulations related to foreign affairs, defense or national security, as well as rules related to internal agency affairs or those exempted by the OMB. One major effect of the order would seem to be a significant increase in the power of OMB as manager of the regulatory budget affected agencies must follow. As the order is implemented and further information is made available, ABA will monitor its effects on any bank-related regulations. Read the executive order. For more information, contact ABA’s Wayne Abernathy.


Scholarship Deadline Nearing for GSB HR Management School

 
One scholarship to attend the Graduate School of Banking at the University of Wisconsin-Madison's Human Resource Management School will be awarded to a South Dakota banker. The deadline to apply for the scholarship is Feb. 10.

The recipient will receive a $925 discount on registration. The school, which will be held March 26-31, is designed specifically for HR professionals in the financial industry and addresses today’s most critical HR issues.

In addition, Prochnow Educational Foundation/SDBA scholarships will be awarded to two South Dakota bankers attending the 2017 Graduate School of Banking school session July 30 to Aug. 11. The scholarship amount is $1,300 for each year of the student’s attendance (approximately one-third of the annual tuition fees), for a total value of $3,900.

This scholarship is for people who will be entering their first year at GSB. The deadline to apply for the scholarship is May 1. A separate application for the school must be completed via the GSB website.

Learn more about both scholarships and apply.


ABA's Interactive Robbery Database Adds ATM Crime Feature

 
ABA Bank Capture --the association’s nationwide bank crime database--has added a new interactive feature that allows subscribers to input ATM crime data, including ATM skimming.

“ATM skimming can be a costly crime for banks, and it’s becoming more and more sophisticated,” said ABA SVP Doug Johnson, “Studies show that criminals steal ten times more money in the average skim versus the average bank robbery. This new feature will be an incredibly helpful tool to help banks track patterns of criminal activity and effective preventative measures.”

The subscribers-only Bank Capture database provides a platform for banks of all sizes to report, share and analyze data specific to robberies, ATM crimes, burglaries and larcenies. Developed in collaboration with the nation’s leading bank security directors and FBI officials, ABA Bank Capture can help bankers be notified of local and national incidents, identify criminal activity trends and patterns, assess the effectiveness of their security controls and use reports to enhance business decisions and properly allocate resources.

The database is endorsed by ABA’s Corporation for American Banking. Learn more about ABA Bank Capture. For more information or to schedule a demonstration of the system, contact ABA’s Kelly Tyson.


CFPB Issues Compliance Guide on Prepaid Rules

 
The Consumer Financial Protection Bureau yesterday issued a small entity compliance guide for its final rule on prepaid accounts. The rule brings prepaid accounts under Regulation E while also bringing certain credit-like features of some prepaid accounts under Regulation Z. The rule takes effect on Oct. 1, 2017.

The guide covers definitions of various prepaid accounts, exclusions in the rule, entities subject to the rule, required disclosures at various points, change-in-terms notices, periodic statements and alternatives, error resolution, limitations on liability, receipts at electronic terminals, access devices, compulsory use, account agreements, overdraft credit features, remittances and record retention, among other topics. Download the compliance guide.