SDBA eNews

August 30, 2018

Two SDBA Banks, One Associate Member Named 'Best Banks to Work For'

American Banker Magazine on Tuesday published its sixth annual list of the 85 best banks to work for, with two SDBA member banks and one associate member making the list. Dacotah Bank, Aberdeen, was named number 49, and First PREMIER Bank, Sioux Falls, was named number 71. SDBA associate member Bell Bank, Fargo, was number three.

For the banks that made the list, lavishing employees with perks and benefits is part of the culture. These banks’ largesse also extends beyond their employee base. Volunteering in the community and charitable contributions are a cornerstone of their philosophies.

The SDBA congratulates these and other banks for establishing a culture and amenities that help attract and retain top talent, from generous health insurance and retirement benefits to employee prize programs, jovial atmospheres and employee financial health programs. See the full list

USDA Announces Details of Assistance for Farmers Impacted by Trade Damage

U.S. Secretary of Agriculture Sonny Perdue on Monday announced details of actions the U.S. Department of Agriculture (USDA) will take to assist farmers in response to trade damage from unjustified retaliation by foreign nations.

President Trump directed Perdue to craft a short-term relief strategy to protect agricultural producers while the Administration works on free, fair and reciprocal trade deals to open more markets in the long run to help American farmers compete globally. USDA will authorize up to $12 billion in programs, consistent with its World Trade Organization obligations.

USDA’s Farm Service Agency (FSA) will administer the Market Facilitation Program (MFP) to provide payments to corn, cotton, dairy, hog, sorghum, soybean and wheat producers starting Sept. 4. For each commodity covered, the payment rate will be dependent upon the severity of the trade disruption and the period of adjustment to new trade patterns, based on each producer’s actual production.

Interested producers can apply after harvest is 100 percent complete and they can report their total 2018 production. Beginning Sept. 4, MFP applications will be available online. Producers will also be able to submit their MFP applications in person, by email, fax or by mail. 

In addition to the Market Facilitation Program, the Food Purchase and Distribution Program will purchase up to $1.2 billion in commodities unfairly targeted by unjustified retaliation, and $200 million will be made available to develop foreign markets for U.S. agricultural products.

OCC Asks for Feedback on Modernizing CRA

The OCC yesterday issued a long-anticipated advance notice of proposed rulemaking seeking input on the best ways to modernize Community Reinvestment Act regulations. The ANPR asks for comment on several issues, including how to:

  • Encourage more lending areas that need it most, including low- and moderate-income areas
  • Broaden and clarify the types of activities eligible for CRA consideration
  • Update assessment area definitions to accommodate digital lending channels
  • Measure bank CRA performance by a metric-based framework, “using quantitative benchmarks” that would assign numerical values to CRA activities
  • Evaluate CRA activities more consistently
  • Reduce the cost and burden of CRA evaluation

The ANPR formally kicks off what will be a months-long process of modernizing the CRA regulatory framework. Because the OCC will share the ANPR results with the FDIC and the Federal Reserve, ABA encourages all U.S. banks--whether or not they are OCC supervised--to respond to the ANPR and emphasize the need for modernization.

“For years, outdated rules, a lack of transparency and inconsistent examinations have limited the effectiveness of the CRA. The current framework is holding back investment in communities the law is intended to serve, while failing to account for significant innovations in the banking sector, including the opportunities presented by mobile technologies,” said ABA President and CEO Rob Nichols in a statement, echoing perspectives he shared in a recent The Hill op-ed. “We have heard from bankers across the country who have told us that the current CRA rules make it harder for them to serve their communities, which makes today’s OCC action both timely and necessary.”

ABA staff are reviewing the ANPR and will provide resources to facilitate banker comments, which will be due 75 days after publication in the Federal Register. Bankers can access more ABA resources on CRA reform at

ABA also urges bankers to share their comments with ABA so that the association can amplify the collective industry response.

Fed Issues Rule Offering Relief for Small Bank Holding Companies

The Federal Reserve Board on Tuesday issued an interim final rule implementing a provision in S. 2155 that raises the asset threshold for relief under the Fed’s small bank holding company policy statement from $1 billion to $3 billion. It also applies to savings and loan holding companies with less than $3 billion in total consolidated assets.

ABA has long advocated raising the threshold for the policy statement, which facilitates the ability of community banks to issue debt and raise capital by exempting them from certain capital requirements. The rule takes effect upon publication in the Federal Register, and the agencies will welcome comments for 30 days after publication. Read the rule

CFPB Announces 2019 Reg Z Dollar Thresholds

The Consumer Financial Protection Bureau has announced 2019 changes in dollar thresholds for several Regulation Z provisions governed by the CARD Act, the Home Ownership and Equity Protection Act and the Dodd-Frank Act. The thresholds are based on changes in the Consumer Price Index and take effect on Jan. 1, 2019.

For credit cards, the penalty fees safe harbor for 2018 will increase by $1 to $28 for a first late payment. The subsequent late payment safe harbor fee will also grow by $1 to $39. The minimum interest charge disclosure threshold will remain unchanged for 2019 at $1. The HOEPA loan threshold will increase to $21,549, and the HOEPA points-and-fees trigger will rise to $1,077.

For Qualified Mortgages, points and fees cannot exceed 3 percent of loans of $107,747 or more; $3,232 for loans between $64,648 and $107,747; 5 percent for loans between $21,549 and $64,648; $1,077 for loans between $13,568 and $21,549; and 8 percent for loans of less than $13,468. Read more

Final Rule Implements Extended Exam Cycle for More Banks

Implementing a provision in the S. 2155 regulatory reform bill, the federal banking agencies last week issued joint interim final rules that make qualifying banks with up to $3 billion in assets eligible for an 18-month on-site exam cycle. Prior to S. 2155’s passage, only banks with under $1 billion in assets were eligible.

Under the final rules, insured depository institutions, including federal or state branches of foreign banks, qualify if they have an “outstanding” or “good” composite rating. “The agencies believe that extending the examination cycle from 12 months to 18 months for these small IDIs with relatively simple risk profiles should not appreciably increase their risk of financial deterioration or failure,” they said.

ABA has long advocated for raising the threshold of institutions eligible for an extended exam cycle. The rules take effect upon publication in the Federal Register, and the agencies will welcome comments for 60 days after publication. Read the interim final rule. For more information, contact ABA's Shaun Kern

Learn to Start Practicing CECL Now

The effective date of the Current Expected Credit Loss (CECL) model is getting closer. It’s time to get out of the stands and get on the field. To be successful when CECL goes into effect, you need to start practicing now.

The SDBA will offer the seminar “CECL From End to End: Discussion, Data Decisions” on Sept. 25 in Sioux Falls. The training will be held from 9 a.m. to noon at the Hilton Garden Inn—Sioux Falls Downtown at 201 E. Eighth St.

This half-day CECL seminar will provide in-depth discussion of how to prepare for your bank’s CECL implementation. This session is for CEOs, CFOs and anyone else responsible for helping their financial institution implement the new CECL model. Learn more and register to attend.

Deadline Nearing to Place Order for 2019 Scenes of South Dakota Calendar

The deadline to place your order for the 2019 Scenes of South Dakota Calendar and receive the low price of $1.19 per calendar is Sept. 1. 

Offered by the SDBA, the calendar features photos of South Dakota submitted by South Dakota bankers, their family members and customers. Your bank or business logo can be printed on each calendar to display in homes and businesses all year long. The Scenes of South Dakota Calendar is exclusive to SDBA member banks and associate members. These calendars are a great opportunity to thank your customers for their business and promote your bank.

To get the low price of $1.19 per calendar, orders are due by Sept. 1. After Sept. 1, the price is $1.49 per calendar. Orders cannot be accepted after Sept. 15. Orders will ship on Nov. 1. Learn more and place your calendar order

Compliance Alliance

Question of the Week

Question:  For TRID purposes, when we receive a preliminary title CD from a title company and it has seller-paid fees on it, do we have to disclose the seller-paid fees to the borrower on our CD or can we leave these seller-paid fees off of the CD we give the borrower?                 

Answer: Even though you are able to give separate CDs to the borrower and seller, seller-paid loan costs are required, per the guidance, to be disclosed on the CD that you give the borrower.

CFPB, TILA/RESPA Small Entity Compliance Guide, p. 80: “Seller-paid Loan Costs and Other Costs are required to be disclosed on the consumer’s Closing Disclosure, regardless of whether a separate Closing Disclosure is provided to the seller. Seller-paid real estate commissions are one example of seller-paid costs that may not be omitted from and must be included on the consumer’s Closing Disclosure. (§ 1026.38(g)(4); Comment 38(g)(4)-4).”

Not a member? Learn more about membership with Compliance Alliance by attending one of our live demos:

Compliance rules and regulations change quickly. For timely compliance updates, subscribe to Compliance Alliance’s email newsletters.

Compliance Alliance offers a comprehensive suite of compliance management solutions. To learn how to put them to work for your bank, call 888.353.3933 or email.

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Contact Alisa DeMers, SDBA, at 800.726.7322 or via email.