SDBA Women in Banking Conference Hotel Room Block Deadline Nearing

Picture of women in an office. The hotel room block for the SDBA's LEAD STRONG: Women in Banking Conference will be released on Sunday, Aug. 15.

This year's Women in Banking Conference will be held Sept. 15 at the Sioux Falls Convention Center, with a reception the evening prior at R-Wine Bar in Sioux Falls. Sessions include: "The Spectrum of Awesome," "Human Trafficking: Closer to Home Than You Think," "Leadership--Courage Within," Sit Down, Gordon. I Am Enough." and "Building a Powerful Presence."

In addition to a great lineup of speakers and ample opportunity to network, attendees should come prepared for some interactive sessions. Bring your best listening skills, your most insightful questions for our industry leader panel and bring a book or two that you would like to exchange during the “Once Upon a Time...” session.

To reserve a hotel room, contact the Sheraton Sioux Falls at 605.331.0100. See the full conference agenda and register to attend.

ABA Supports Amendment Blocking New Account Flow Reporting Requirements

ABA on Tuesday wrote to Senate leaders in support of an amendment to the budget resolution put forth by Sen. Mike Crapo (R-Idaho) that would prevent the Internal Revenue Service from establishing a new information reporting framework for individual or business bank accounts with flows of $600 or more. Such a framework was included as part of the Biden administration’s tax proposal earlier this year to help shrink the tax gap.

ABA emphasized that banks already report a considerable amount of information to the IRS and developing and executing the new reporting regime would be complex, time-consuming and could pose a threat to data privacy. “The proposed reporting system would apply across most, if not all, bank products—including many that do not currently require any IRS reporting and consequently do not have even the baseline analytical and reporting infrastructure needed to support this type of reporting,” ABA noted. “This would be a significant operational undertaking, especially for community banks that are often dependent on third-party service providers for their system updates.”

The amendment was narrowly defeated by a vote of 49 to 50. ABA will continue to oppose any attempts to enact this reporting framework in the days ahead. Read the letter.

CFPB Issues Interpretive Rule on Juneteenth-Related Mortgage Closing Delays

The Consumer Financial Protection Bureau last Thursday issued a long-awaited interpretive rule providing clarity on how the newly-enacted Juneteenth holiday affected the timing of disclosures required for mortgage transactions in process. President Biden earlier this summer signed legislation recognizing Juneteenth as a new federal holiday. Since June 19 fell on a Saturday, the federal government observed the holiday on June 18. However, given the short timeframe between the law’s enactment and the observed federal holiday, questions arose about how it would affect mortgage closings.

The guidance addresses Regulation Z timing requirements related to rescission of closed-end mortgages and the TILA-RESPA Integrated Disclosures. It clarifies that “if the relevant closed-end rescission or TRID time period began on or before June 17, 2021, then June 19, 2021, was considered a business day, but nothing prohibits creditors from providing longer time periods. Therefore, it would also be compliant for creditors to have considered June 19, 2021, a Federal holiday for purposes of these provisions.”

The interpretive rule will take effect upon publication in the Federal Register. ABA has published a members-only staff analysis. Read the interpretive rule. Read ABA's staff analysis . For more information, contact ABA’s. Rod Alba or Sharon Whitaker.

Banking Trade Groups Call for Changes to PPP Purchase Guaranty Procedural Notice

ABA last Friday joined the Bank Policy Institute and the Consumer Bankers Association in a letter to the Small Business Administration calling for changes to a recent Paycheck Protection Program procedural notice addressing SBA guaranty purchase and lender servicing responsibilities for PPP loans. The groups called for language that would more appropriately reflect the “hold harmless” provision and the 100% guaranty that are fundamental pillars of the program as envisioned by Congress.

The groups raised concerns that “the certifications to request an SBA guaranty purchase prescribed by the procedural notice subject lenders to a higher standard than that set forth under the 7(a) loan program,” and that “the certifications set forth in the procedural notice do not acknowledge that an authorized lender official can only reasonably certify to material information on behalf of that lender that he or she would know.”

The associations offered several specific revisions to the certification statements that would “appropriately reflect the fundamental principle underlying the program—namely, that so long as lenders, acting in good faith, satisfy the program’s requirements, including those set forth in the procedural notice, the loan will be fully forgiven by the SBA.” Read the letter . For more information, email [email protected].

SEC Approves Nasdaq Rules to Promote Board Diversity

The SEC last week approved new Nasdaq rules for companies listing on the stock exchange that will require them to publicly disclose consistent transparent diversity statistics regarding their board of directors. Under the new rules, most Nasdaq-listed firms will be required to demonstrate—or explain why they do not have—at least two board members who represent Nasdaq-designated categories, including at least one individual who self-identifies as female and at least one who self-identifies either as a member of a racial or ethnic minority or as LGBTQ+.

The rules will take effect on a “two-stage deferred basis” and will provide transition periods for newly listed companies and listing transfers. Exceptions will also be provided for certain companies. Companies listed on the Nasdaq Global Select Market, Nasdaq Global Market and Nasdaq Capital Market would have slightly longer timeframes to comply.

Companies will begin annual disclosures of their board diversity data using a board diversity matrix by the later of one calendar year from Aug. 6, or the date the company files its proxy statement or its information statement for its annual shareholder meeting during the calendar year of the effective date. Companies also have the option to publish the information on their websites rather than providing the disclosure in the proxy statement.

The new rules could face legal challenges in the coming days. ABA is monitoring developments and will provide updates to members as warranted. Read more. For more information, contact ABA’s Mike Gullette or Joe Pigg.

FFIEC Issues Guidance on Digital Banking Authentication, Access Risk Management

The Federal Financial Institutions Examination Council yesterday issued a guidance for financial institutions on effective authentication and access risk management principles for digital banking services. The guidance does not impose any new regulatory requirements on banks, nor does it serve as a comprehensive framework for access management programs or endorse any specific information security framework or standard. FFIEC also noted that the guidance “is relevant whether the financial institution or a third party, on behalf of the financial institution, provides the accessed information systems and authentication controls.

The guidance highlights current cybersecurity threats, including increased remote access by customers and attacks that take advantage of compromised credentials. It also includes information on the risks from push payment capabilities, examples of authentication controls and a list of government and industry resources to assist financial institutions with authentication and access management.

The new guidance also highlights weaknesses in single-factor authentication and discusses how multi-factor authentication can effectively mitigate risks. The guidance replaces FFIEC-issued resources on digital banking released in 2005 and 2011. Read the guidance.

ABA to Host Webinar on Emergency Capital Investment Program

ABA will host a webinar on Monday, Aug. 16 at 1 p.m. CDT about the Emergency Capital Investment Program, featuring U.S. Treasury’s Christopher Weaver, ECIP director, and David Alexander, attorney adviser, Office of General Counsel. The webinar will provide an in-depth overview about the new application deadline, program changes, and how new guidance from Treasury will affect efforts by certified community development financial institutions and minority depository institutions to access up to $9 billion in capital to support low- and moderate-income and minority communities. Register now.

Inclusion and the Future of Banking Webinar

Banking leaders recognize that becoming more inclusive is essential to thriving in the 21st century. By improving hiring practices, lending procedures, employee engagement and community relationships, those who transcend divisions and cultivate a greater sense of belonging are those who will flourish in today’s rapidly evolving world.

The Graduate School of Banking at the University of Wisconsin-Madison and the Wisconsin School of Business will hold a complimentary webinar "Inclusion and the Future of Banking" on Sept. 14 at 10 a.m. CDT. This webinar will explore the benefits of inclusion and provide concrete strategies for improving decision making, organizational policies, and business approaches that will help attendees diversify their thinking and grow their ability to foster meaningful connections between communities.

Key takeaways will include: define inclusion, explore benefits of being more inclusive, survey examples of more inclusive business practices and explore concrete practices to foster inclusion. Learn more and register.

Question of the Week

Question: What are the consequences if a bank places a hold on a deposit into a checking account beyond the time allowable under Regulation CC?

Answer: Regulation CC, § 229.21, provides penalties for violations of Subpart A of the regulation, which is the section that governs hold times. The penalties under that section are as follows:

(a) Civil liability. A bank that fails to comply with any requirement imposed under subpart B, and in connection therewith, subpart A, of this part or any provision of state law that supersedes any provision of subpart B, and in connection therewith, subpart A, with respect to any person is liable to that person in an amount equal to the sum of—

(1) Any actual damage sustained by that person as a result of the failure;

(2) Such additional amount as the court may allow, except that—

(i) In the case of an individual action, liability under this paragraph shall not be less than $100 nor greater than $1,100; and

(ii) In the case of a class action—

(A) No minimum recovery shall be applicable to each member of the class; 12 CFR 229.21(a), https://www.ecfr.gov/cgi-bin/text-idx?SID=71d11224522d9c4841e8c490426e391b&mc=true&node=se12.3.229_121&rgn=div8

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