SDBA eNews

July 22, 2021

Registration Open for SDBA's 2021 Bank Technology Conference

SDBA Bank Technology ConferenceTechnology and innovation have been transforming financial services since long before artificial intelligence and iPhones, and your role as an IT professional is ever-changing, especially in today’s environment.

The SDBA'S Bank Technology Conference on Sept. 8-9 in Sioux Falls is designed to provide support as you keep on top of technology trends, navigate the business of banking, and build and sustain your bank’s technology strategy—all to improve access and better serve your customers. This conference will provide you with an opportunity to learn from industry experts, network with IT colleagues, and visit with exhibitors to see and experience the latest in products and services.

The event will be held at the Hilton Garden Inn Sioux Falls South and will begin with an evening reception with exhibitors. See the full agenda and register to attend

Registration Open for SDBA's 2021 IRA School

SDBA IRA SchoolThe SECURE Act impacts two main topics: RMDs and death distributions. The SDBA’s 2021 IRA School on Sept. 28 to Oct. 1 in Sioux Falls will address these relevant changes.

IRAs are one of the most complicated areas of bank personnel responsibility. Continual education is necessary to ensure confidence. Working with IRAs is a process and must start with a strong foundation. This school can provide this foundation through a comprehensive curriculum.

The school will be held at the Clubhouse Hotel & Suites in Sioux Falls. Attendees can register to attend the full school, days one to three, or day four only. See the full agenda and register to attend.

ABA: Banks Committed to Reducing Number of Unbanked Americans

In a statement for the record shared ahead of a House Financial Services subcommittee hearing on expanding access to the financial system yesterday, ABA emphasized the banking industry’s commitment to reducing the number of unbanked individuals in the country. The statement details ABA's support for the Bank On movement, a national effort led by the Cities for Financial Empowerment Fund, designed to extend access to banking services to U.S. households that remain unbanked. Bank On-certified accounts include features like low costs, no overdraft fees, robust transaction capabilities via a debit or prepaid card and free online bill pay.

“More than 7 million households remain outside the banking system without a deposit account. America’s banks believe everyone should have access to the banking system and the safety, convenience and other benefits that come with a bank account—and we are committed to continuing our efforts to build trust with unbanked consumers,” the ABA said, adding that since it began encouraging banks to offer Bank On accounts in October 2020, the number of Bank On-certified accounts has more than doubled.

Since then, ABA has expanded its efforts to bring more banks into the program, promoting Bank On via virtual events, podcasts, webinars, paid social and digital media campaigns and other member communication initiatives. At the hearing, which also examined the role public banks and the Postal Service could play in addressing the unbanked problem, a top CFE Fund executive highlighted the increasing number of banks offering Bank On accounts and the measurable progress the program has made in reaching the unbanked. Read the statement.

Agencies Signal Joint CRA Regulatory Overhaul to Come

Acting Comptroller of the Currency Michael Hsu on Tuesday announced that his agency will propose rescinding the changes to the Community Reinvestment Act regulations that were finalized in May 2020, and he also signaled the OCC’s intent to work together with the Federal Reserve and the FDIC on a separate joint rulemaking to overhaul the CRA framework.

“While the OCC deserves credit for taking action to modernize the CRA through adoption of the 2020 rule, upon review I believe it was a false start,” Hsu said. “This is why we will propose rescinding it and facilitating an orderly transition to a new rule. I look forward to working with the other agencies to develop a joint notice of proposed rulemaking and building on the ANPR proposed by the [Fed] board in September 2020.”

In a joint statement, the agencies noted that they have “broad authority and responsibility for implementing the CRA,” and that “joint agency action will best achieve a consistent, modernized framework across all banks.”

ABA has long advocated for a consistent approach to CRA modernization and welcomed the news. “We firmly believe that there is a need to update and modernize the CRA rules to reflect today’s modern banking system and the needs of communities, but those rules must be consistent across all of the banking agencies,” said ABA President and CEO Rob Nichols. “By proposing to rescind the OCC’s 2020 rule and announcing a commitment to develop a joint rulemaking involving all of the banking regulators, there is a new opportunity to craft a single set of rules for banks to follow.” Read the joint statementRead the OCC’s statement.

Trade Groups: Costs of Potential New IRS Reporting Requirements Outweigh Benefit

The ABA and 51 state bankers associations on Tuesday urged members of Congress to oppose an effort to impose new tax reporting requirements on banks that would require them to report information on account flows on every account above a de minimis threshold of $600, including earnings from investment and business activity. President Biden’s American Families Plan floated such a measure as a way to shrink the so-called “tax gap.”

The association cautioned that “this proposal would create a dragnet, collecting the financial information of most Americans and requiring significant resources to build, police and maintain” and that “policymakers must consider how account-holder data would be protected and whether a program of this scale and scope infringes on the American people’s reasonable expectation of privacy.”

They also emphasized that financial institutions already have robust reporting responsibilities and that creating a new reporting structure would be costly and burdensome. “The existing reporting regime captures the majority of taxable events of the high-income taxpayers that the administration believes it is targeting,” the groups said. “We urge policymakers to ensure that the existing framework of information collection and oversight is fully utilized before adopting new requirements.” Read the letter.

FHFA Eliminates Controversial 'Adverse Market Refinance Fee'

The Federal Housing Finance Agency last Friday announced that it will eliminate a widely panned “adverse market refinance fee” of 50 basis points for no-cash-out and cash-out refinance mortgages for loan deliveries effective Aug. 1. The fee was originally put in place to help cover losses at Fannie Mae and Freddie Mac due to the coronavirus pandemic.

The ABA and several advocacy groups strongly criticized the fee when it was announced last year and urged that it be withdrawn. Several lawmakers also raised concerns about the fee and the added cost it would impose on homeowners.

“The elimination of this fee will improve the affordability and availability of credit for borrowers and ultimately help those seeking to refinance into lower rate loans and improve their financial condition as the country continues to recover from the COVID-19 pandemic,” said ABA President and CEO Rob Nichols. “ABA and its members appreciate FHFA’s willingness to hear the concerns raised by ABA and others and to take action which will greatly benefit our nation’s struggling homeowners.”

In a statement announcing the withdrawal of the fee, FHFA noted that “the success of FHFA and the Enterprises' COVID-19 policies reduced the impact of the pandemic and were effective enough to warrant an early conclusion of the Adverse Market Refinance Fee,” and added that “FHFA's expectation is that those lenders who were charging borrowers the fee will pass cost savings back to borrowers.” Read more.

Registration Open for 2021 ABA Ag Bankers Conference

Registration is now open for the 2021 ABA Agricultural Bankers Conference, to be held Nov. 14-17 in Cincinnati. This year's conference returns to a standalone event after being held virtually as part of 2020’s Unconventional Convention. Sessions will focus on strategies and expertise to help ag bankers better prepare for and manage shrinking profit margins in the current low-rate, highly-competitive environment.

Confirmed speakers include agricultural economist David Kohl; media and marketing expert Kristi Piehl; Purdue University’s Jason Henderson, who will discuss monetary policy's impact on U.S. agriculture; and atmospheric scientist Eric Snodgrass, who will lead a session on the wild side of weather.

Early-bird registration rates are available now through Sept. 10. Special pricing for Ohio-based bankers is also available. Register now.

Photo Submission Deadline Nearing for 2022 Scenes of South Dakota Calendar

Scenes of South Dakota CalendarThe deadline to submit photos for the SDBA's 2022 Scenes of South Dakota Calendar is Friday, July 30. The calendar features photos of South Dakota submitted by South Dakota bankers, their family members and customers.

If you or one of your bank’s employees, a relative or customer are an amateur photographer and would like the opportunity to have your creativity displayed in homes and businesses across the state, send the SDBA your photos of farms, barns, agricultural activities, historical South Dakota locations, county fairs, carnivals, parades or festivals, fall colors, winter snowfalls, spring flowers, summer fun, etc.

Any photo that shows the history or beauty of South Dakota qualifies. Photos will be judged with the top photos featured in the 2022 Scenes of South Dakota Calendar. Photo submission form

SDBA member banks and associate members can also place an order to purchase the 2022 Scenes of South Dakota Calendar. Calendar orders are due Sept. 1, 2021. Learn more and place an order.


Question of the Week

Question: If a bank has three applicants who are denied for a loan and the reasons for denial are different for each, does each borrower need to get an adverse action notice, stating the specific reason for denial for that applicant, or can one adverse action be provided with all reasons to all applicants?

Answer: The Federal Reserve has clarified that Regulation B requires creditors to provide an adverse action notice to each applicant with the specific reasons pertaining to each applicant.

The requirements are different for multiple applicants. According to Regulation B, if multiple applicants submit an application, notice need only be given to the primary applicant if the primary applicant is readily apparent. In the case of multiple applicants under the FCRA, the statute has been interpreted to require notice to all consumers against whom adverse action is taken if the action taken was based on information in a consumer report. If the applicants' credit scores were used in taking adverse action, each individual should receive a separate adverse action notice with the credit score and related disclosures associated with his or her individual consumer report; however, an applicant should not receive credit score information about a applicant. Regulation B does not prohibit delivery of an adverse action notice to each applicant.

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

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.

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