SDBA eNews

February 25, 2021

SDBA Seeking Candidates for 2021 Board Elections

Elections for the SDBA’s Board of Directors are scheduled for April. Three seats are up for election: Group II, Small Community Bank Category, and Large Community & Regional Bank Category.

The Group II seat is currently held by Jeff Davis, Bryant State Bryant, Bryant, and the Small Community Bank seat is currently held by Brad Seaman, BankNorth, Aberdeen. Both have served two consecutive, three-year terms and are not eligible to run for re-election. The Large Community & Regional Bank seat was previously held by David Bangasser, Dacotah Bank, Sioux Falls, who is now serving as SDBA vice chair.

Bank employees in the following counties are eligible to run for the Group II seat: Beadle, Brookings, Brown, Clark, Codington, Day, Deuel, Grant, Hamlin, Kingsbury, Marshall, Roberts and Spink. Employees of banks with deposits of less than $75 million are eligible to run for the Small Community Bank Category seat, and employees of banks with deposits of more than $750 million are eligible to run for the Large Community & Regional Bank Category seat.

If you are interested in running for one of the Board seats, please contact one of the nominating committee members by March 18, 2021. Please also submit a short bio and headshot photo for the voting ballot to Alisa Bousa at [email protected]. Newly-elected Board members will take office on May 1, 2021, and serve a three-year term expiring April 30, 2024. View the 2021 election notice and nominating committees.

Biden Administration Announces Measures to Target PPP Loans to Smallest Firms

The White House on Monday announced several measures to ensure the smallest firms have access to Paycheck Protection Program loans, including an exclusive application window for firms with fewer than 20 employees, a revised loan calculation and funding set-aside for sole proprietors and self-employed individuals and new eligibility for businesses owned by those with certain felony convictions. Five weeks after the PPP reopened, roughly $150 billion—more than half of the amount authorized for the 2021 round of PPP—remains available. The current round of funding expires on March 31.

Specifically, the White House said that the Small Business Administration would:

  • Provide an exclusive 14-day window, starting Wednesday, Feb. 24, when only businesses with fewer than 20 employees are eligible to apply.
  • Set aside $1 billion for PPP loans for sole proprietors, independent contractors and self-employed individuals in low-to-moderate-income areas and revise the loan calculation formula for these applicants. (According to press reports, the revised formula would only be available to new applicants, not retroactive.)
  • Eliminate a rule restricting businesses at least 20% owned by an individual who was arrested for or convicted of a felony related to financial assistance fraud in the previous five years or any other felony within the previous year; the restriction will only apply to businesses with applicants or owners who are incarcerated from receiving PPP loans.
  • Eliminate a rule restricting businesses at least 20% owned by an individual who is delinquent on student debt from receiving PPP loans.
  • Clarify that non-citizens may apply using individual taxpayer identification numbers.

To prompt more applicants to self-report demographic data, SBA has already updated the loan application form to include demographic data on the front page, the White House said. Meanwhile, “SBA is launching a new initiative to deepen its relationships with lenders,” the White House added. “This model will increase opportunity for lenders to provide recommendations and ask questions about the PPP and drive resolution of open questions and concerns in a more streamlined way.”

ABA's Nichols Weighs In on PPP Changes

ABA President and CEO Rob Nichols on Monday expressed the industry’s continued commitment to ensuring that PPP loans are widely available.

“Since the start of the pandemic, banks of all sizes have stepped up to provide more than 87% of all PPP loans, reaching more than 4.6 million small businesses and supporting more than 48 million jobs,” Nichols said. “More than 86% of PPP loans made by banks in 2020 were for less than $150,000, with an average loan size of $108,235. In the current round alone, 81% of PPP loans have gone to businesses with fewer than 10 employees.”

Nichols added that banks stand ready to implement the changes announced yesterday, “just as they have adjusted to the myriad of PPP changes over the past year. We remain hopeful that as this program enters its final weeks, SBA will work with lenders in addressing the many administrative issues that are still hindering some small businesses from fully utilizing the program. Clear and transparent guidance on exactly which businesses are eligible for PPP loans during the upcoming restricted access period is absolutely essential."

Federal Reserve Payment Services Suffer Temporary Outage

Yesterday at 10:15 a.m. CST, a reported “internal operational error” caused all Federal Reserve payment systems services to shut down, including Fedwire, FedACH and Check 21. All 11 different applications were restarted within three and a half hours.

Banks can check the status of payment systems services through a web-based dashboard to learn if any of the applications are operating in a green, yellow or red status. If a bank is experiencing issues with any Federal Reserve payment service it can use the Federal Reserve support directory to enter its ABA Routing Number to receive a customized list of contacts or banks can click on a department to get specific numbers. 

Vilsack Confirmed as Ag Secretary; Trades Call for Protection of Crop Insurance

The Senate yesterday confirmed Tom Vilsack to serve as agriculture secretary by a bipartisan vote of 92 to 7. A former Iowa governor, Vilsack previously served in the role during the Obama administration.

In letters to Vilsack and other top policymakers yesterday, ABA and a broad coalition of agricultural trade organizations emphasized the need to protect crop insurance from harmful cuts as the Biden administration develops its FY 2022 budget proposal. The groups emphasized that access to crop insurance is vital for the nation’s producers, given the unpredictability of the agricultural sector.

“Farmers, agribusinesses, lenders and lawmakers agree that crop insurance is a linchpin of the farm safety net and is crucial to the economic and food and fiber security of urban and rural America,” the groups wrote. “We urge you to continue to support a linchpin of the safety net for America’s farmers and ranchers and oppose cuts to crop insurance during this year’s budget process.” Read the letter.

FinCEN Issues Advisory on Economic Impact Payment Fraud

The Financial Crimes Enforcement Network yesterday issued an advisory alerting banks to economic impact payment fraud. The advisory describes EIP fraud, associated red flags and how to report suspicious activity.

Authorities have detected a wide range of EIP-related fraud, according to the advisory, including fraudulent checks, theft of EIPs and phishing schemes using EIPs as a lure where fraudsters use emails, letters and phone calls about the payments to get personal information like account numbers and passwords.

FinCEN also issued a companion notice for filing suspicious activity reports related to COVID-19. The notice is part of a series released by FinCEN about COVID-19 related threats and includes key terms to use when filing SARs about pandemic-related activity. Read the advisoryRead the notice.

Next DEI Open Forum Scheduled for March 16

The ABA will host another free open forum on diversity, equity and inclusion in the banking industry on March 16 at 2:30 p.m. CDT for bankers to discuss current DEI challenges and topics, exchange leading practices and ideas and learn more about implementing DEI programs and initiatives at individual banks. Register now.

Learn to Make Videos for Social Media, Marketing and Communications

Since Steven Spielberg isn't going to intern at your company, you need to figure out how to make videos for social media, marketing and communications. Beth Ziesenis will hold the webinar "Lights, Smartphone, Action! A Hands-On Video Workshop" virtually via Zoom on March 18 from 9 a.m. to noon CDT. 

This hands-on workshop teaches a dozen easy, budget-friendly tech tools to make professional-level videos on-the-cheap and on-the-fly. Plus, Ziesenis will add in a few graphic-only tools that can be used on social media accounts. Participants will:

  • Improve storytelling and image-creation skills for better multimedia content.
  • Take home step-by-step guides for creating better videos.
  • Evaluate different multimedia tools and apply strategies for their best uses in social media, marketing and communications.

The registration fee is $89. Learn more and register

 Compliance Alliance

Question of the Week

Question: In determining whether the bank reports a HELOC for HMDA purposes, does the bank need to consider denied, withdrawn and approved but not accepted HELOCs into the threshold of 200? 

Answer: The count is based on the number of open-end lines of credit that the bank has originated.

Reference: Section 1003.3(c)(12) provides that an open-end line of credit is an excluded transaction if a financial institution originated fewer than 500 open-end lines of credit in either of the two preceding calendar years.

Comment 1 to § 1003.3(C)(12):

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 and ask for our Membership Team.

For timely compliance updates, subscribe to Bankers Alliance’s email newsletters.

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Contact Alisa Bousa, SDBA, at 605.224.1653 or via email.