SDBA eNews

April 16 2020

PPP Funds Exhausted; SBA No Longer Accepting Loan Applications

The $349 billion authorized for Paycheck Protection Program loans has been exhausted, the Small Business Administration said today, and the SBA is no longer accepting applications for PPP loans. Loan applications received by banks but not yet submitted to SBA will not be able to be completed, and the agency will not maintain a queue for PPP applications once additional funds are authorized. Any loan applications that have received an SBA authorization number will receive an SBA guaranty.

ABA is strongly advocating for Congress immediately to authorize new PPP funding to meet the payroll needs of small businesses struggling during the coronavirus pandemic. Bankers and their small business customers can contact their lawmakers at 202.224.3121 to emphasize that more funding is needed right away.

“America’s banks were standing by their small business customers before the SBA’s Paycheck Protection Program and will stand by them now that PPP money is nearly depleted, which we hope is only temporary,” ABA President and CEO Rob Nichols said last night. “Banks of all sizes will continue to work closely with small businesses in their communities to assess their options going forward. Given the success of PPP in getting money into the hands of small businesses quickly, we still believe that the best option is for Congress to appropriate additional federal funds as soon as possible given the potential economic damage to small businesses and their millions of employees from this pandemic."

State Bankers Associations Urge Congress to Increase PPP Funding

The 51 state bankers associations yesterday wrote to House and Senate leaders urging them to quickly increase funding for the Small Business Administration’s Paycheck Protection Program. Program funding is projected to be exhausted as soon as this morning.

“In just under two weeks, the PPP has provided an economic lifeline to over one million small businesses across the country and has allowed these small businesses to remain viable—and maintain their workforces—during the COVID-19 pandemic,” the groups wrote. “We urge quick congressional action so banks can continue to distribute these desperately needed funds to small businesses, which form the economic core of our communities.”  Read the letter.

IRS Launches Online EIP Tool to Check Status, Provide Payment Info

The Internal Revenue Service yesterday launched a second online tool that enables consumers who have previously filed a tax return to check the status of their economic impact payment. Using the Get My Payment tool—available at—consumers can see the date their payment is scheduled to be deposited in their bank account or mailed to them and provide their bank account information to receive direct deposit if it is not currently on file with the IRS.

Taxpayers accessing the secure site will be asked to provide their Social Security number, date of birth and the mailing address used on their tax return. Taxpayers who need to add their bank account information will also need to provide their adjusted gross income for their most recent tax return submitted, the refund or amount owed from their last filed tax return, their bank account type, account and routing numbers.

The IRS said it intends to update the site once daily, usually overnight. A Spanish version of the site will also be available in the coming weeks. For individuals who do not normally file tax returns, the IRS launched a separate tool last week where they can provide payment information. Access the Get My Payment tool. Access the tool for non-filers.

ABA has created a dedicated webpage,, focusing on economic impact payments. The page includes all of ABA’s EIP resources, including media talking points, an FAQ for consumers and consumer tips for avoiding fraud related. ABA has also compiled a partial list of banks offering online account openings that can be opened with a zero balance and funded with an EIP. Access ABA's EIP age.

ABA, Groups Call on Congress to Shield EIPs from Garnishment

Congress should protect CARES Act economic impact payments (EIPs) from being garnished to pay creditors, ABA and several other financial groups said yesterday. “America’s banks stand ready to provide full access to funds appropriated for the explicit purpose of helping families make ends meet” in response to the coronavirus pandemic, they explained.

In a letter to congressional leaders joined by the Bank Policy Institute, the Clearing House, the Consumer Bankers Association and the Financial Services Forum, ABA emphasized that the CARES Act exempted EIPs, which are currently being processed, from offsets for debts to government agencies (except for child support)—but not from court-ordered garnishments to pay creditors.

“As a result, banks are obligated to treat them accordingly, which will impose a significant burden for some families facing unprecedented circumstances,” the groups said. “We believe it is imperative that Congress make it clear that these payments are treated as benefits subject to the federal exemption from garnishment.” The groups added that direct deposit payments are easier to protect from garnishment than paper checks. Read more.

Treasury Confirms PPP Lenders May Use Scanned Documents, E-Sign

The Treasury Department yesterday updated its frequently asked questions on the Small Business Administration’s Paycheck Protection Program to confirm that PPP lenders may accept scanned copies of documents, as well as electronic signatures or consents permitted under the E-Sign Act.

Treasury noted that in cases where e-signatures are not feasible and the lender must obtain a wet signature without in-person contact, they should “take appropriate steps to ensure the proper party has executed the document.” The FAQ noted that other signature requirements imposed by other applicable laws still apply.

SBA Clarifies Bank Director, Shareholder Eligibility for PPP Loans

In the interim final rule, the SBA clarified that many bank directors and shareholders are eligible for PPP loans from their banks. Pre-existing SBA limits on these applicants’ eligibility shall not apply to otherwise eligible businesses owned in whole or part by outside bank directors or those holding a less-than-30% equity interest in the PPP lender, provided that the eligible business follows the same process as any similarly situated customer or account holder and does not receive favoritism. However, officers and key employees of the bank may not obtain a PPP loan from their own bank but may apply at a different lender.

Gambling businesses are eligible for PPP loans, the SBA added, provided their legal gaming revenue did not exceed both $1 million and 50% of total business revenue in 2019. SBA also clarified that agency requirements for loans pledged for borrowings at a Federal Reserve Bank or advances from a Federal Home Loan Bank do not apply to PPP loans.

Agencies Update BSA/AML Examination Manual

The Federal Financial Institutions Examination Council yesterday released long-awaited updates to its Bank Secrecy Act/Anti-Money Laundering examination manual. The updates—which do not establish new requirements—are intended to provide additional transparency and emphasize a risk-based approach to BSA/AML supervision. The manual was last updated in 2014.

Specifically, the updated manual provides instructions to examiner for tailoring BSA/AML examinations to a bank’s risk profile; assessing the adequacy of an institution’s BSA/AML compliance program; assessing a bank’s BSA/AML risk assessment processes; and developing conclusions and finalizing the exam. The agencies also made clarifications about the difference between mandatory regulatory requirements and supervisory expectations set forth in guidance.

“The agencies are aware of the uncertainty faced by financial institutions during this unprecedented time,” they said, acknowledging the COVID-19 crisis facing banks now. “The manual update, which supports tailored examination work, has been in process for an extended period and should not be interpreted as new instructions or as a new or increased focus.” View the updated manualRead the joint agency statement.

ABA Webinar to Focus on Treasury's Economic Impact Payments

To help banks better understand the EIP program and be prepared to help their customers receive their payments quickly and safely, ABA will host a free webinar on Friday, April 17, at 1 p.m. CDT. Presenters at the webinar will include two Treasury officials who will provide an overview of the program and answer banker questions, as well as banker Christopher Richards, EVP and chief banking services officer at Cape Cod Five Cents Savings Bank in Orleans, Mass. Register for the webinar.

Financial Literacy and Social Distancing Podcast, Webinars

April is Financial Literacy Month, but with schools closed because of the coronavirus pandemic and social distancing rules in place across the country, bankers are pivoting to video conferencing and virtual formats to deliver financial lessons. Teachers and parents are desperate for virtual education offerings, and bankers have an opportunity to amplify their financial education message more than ever this month.

On the latest episode of the ABA Banking Journal Podcast—sponsored by Reich and Tang Deposit Solutions—American Riviera Bank’s Rechelle Ringer discusses what her bank is doing to revamp its financial education offerings for virtual formats, as well as some lessons learned along the way. The ABA Foundation’s Jeni Pastier talks about how to deliver the foundation’s signature Teach Children to Save program virtually, as well as other resources from ABA for digital financial education. Listen to the episode.

The ABA Foundation will host two webinars for bankers next week on financial literacy topics.

  • On April 21, the Foundation will host a webinar on how banks can work to safeguard their older customers from fraud and scams during the COVID-19 pandemic. Learn more and register.

  • On April 22, the Foundation will host a webinar on its Teach Children to Save program. The webinar will cover what bankers need to know about participating in this year’s virtual program, which features lesson plans designed for a digital environment. Bankers and ABA staff will share tips for delivering a successful online presentation. Learn more and register.

Compliance Alliance


Question of the Week

Compliance Alliance Pandemic Resources for Community Banks

Question: With everything happening in regard to the COVID-19 pandemic, the bank has been discussing all of our business continuity planning options. Rescission is one of the areas that we could use some help with. What if we close a rescindable mortgage loan on Monday, but then the bank has to close its branches on Tuesday? Would you give the borrowers another three business day rescission period when we open back up, or would you disperse on Friday as originally planned?

Answer: For the right of rescission, any day except for Sunday and the specific federal holidays mentioned is considered a business day, even if the bank is not open. There is not an express exception in that rule for national emergencies. The bank may consider seeing if the disbursement can be automated or disbursed by an employee remotely. 

"(6) Business day means a day on which the creditor's offices are open to the public for carrying on substantially all of its business functions. However, for purposes of rescission under §§ 1026.15 and 1026.23, and for purposes of §§ 1026.19(a)(1)(ii), 1026.19(a)(2), 1026.19(e)(1)(iii)(B), 1026.19(e)(1)(iv), 1026.19(e)(2)(i)(A), 1026.19(e)(4)(ii), 1026.19(f)(1)(ii), 1026.19(f)(1)(iii), 1026.20(e)(5), 1026.31, and 1026.46(d)(4), the term means all calendar days except Sundays and the legal public holidays specified in 5 U.S.C. 6103(a), such as New Year's Day, the Birthday of Martin Luther King, Jr., Washington's Birthday, Memorial Day, Independence Day, Labor Day, Columbus Day, Veterans Day, Thanksgiving Day, and Christmas Day."

"2. Rule for rescission, disclosures for certain mortgage transactions, and private education loans. A more precise rule for what is a business day (all calendar days except Sundays and the Federal legal holidays specified in 5 U.S.C. 6103(a)) applies when the right of rescission, the receipt of disclosures for certain dwelling- or real estate-secured mortgage transactions under §§ 1026.19(a)(1)(ii), 1026.19(a)(2), 1026.19(e)(1)(iii)(B), 1026.19(e)(1)(iv), 1026.19(e)(2)(i)(A), 1026.19(e)(4)(ii), 1026.19(f)(1)(ii), 1026.19(f)(1)(iii), 1026.20(e)(5), 1026.31(c), or the receipt of disclosures for private education loans under § 1026.46(d)(4) is involved. Four Federal legal holidays are identified in 5 U.S.C. 6103(a) by a specific date: New Year's Day, January 1; Independence Day, July 4; Veterans Day, November 11; and Christmas Day, December 25. When one of these holidays (July 4, for example) falls on a Saturday, Federal offices and other entities might observe the holiday on the preceding Friday (July 3). In cases where the more precise rule applies, the observed holiday (in the example, July 3) is a business day."

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