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Biden Meets with Bank CEOs, Business Leaders to Discuss Debt Ceiling

Failing to raise the debt ceiling and allowing the U.S. to default on its debt would have potentially catastrophic consequences for the economy and for Americans, CEOs of the nation’s largest banks told President Biden yesterday at a White House event. “America simply cannot default on the debt because the U.S. Treasury market is the bedrock of our financial system, domestically and globally,” said Citi CEO Jane Fraser. “Defaulting is going to cause lasting damage to the credibility of the U.S. with investors and markets around the world.”

Beyond that, Fraser added that a default “will hurt consumers, it will hurt small businesses. It’s not an exaggeration to say that even small distortions in the Treasury market can cost taxpayers tens of billions of dollars over many years.” JPMorgan Chase Chairman and CEO Jamie Dimon added that “an actual default would be unprecedented,” and that the “effects would be cascading,” and could range anywhere from “recession to a complete catastrophe for the global economy.” Dimon advocated for the removal of the debt ceiling, noting that “we don’t need to have this every couple of years.” Bank of America Chairman and CEO Brian Moynihan also participated in the meeting.

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SBA Issues Final Rule on PPP Loan Review Decision Appeals Process

The Small Business Administration has issued a final rule outlining procedures for appealing final SBA Paycheck Protection Program loan review decisions to its Office of Hearings and Appeals. The final rule mostly adopts the procedures established in a previously issued interim final rule from August 2020, with minor changes. Most significantly, under the final rule, a timely appeal by a PPP borrower of a final SBA loan review decision will extend the deferment period of the PPP loan. Previously, a timely appeal did not result in deferral of payment under the PPP loan.

Under the final rule, borrowers have 30 days to appeal their loan review decision. The rule specified that “the clock for counting days will begin only after the borrower has received the actual final SBA loan review decision document.” The final rule also made several additional changes to streamline the appeal filing process.

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ABA Issues FAQs on Vaccine Mandates

With President Biden issuing vaccine mandates for some employers, ABA has published a members-only set of frequently asked questions that breaks down whether the mandates apply to banks.

The federal government’s Safer Federal Workforce Task Force issued guidance last week that requires COVID-19 vaccination of all employees of federal contractors by Dec. 8, unless the employee is legally entitled to an accommodation for a disability or sincerely held religious belief, practice or observance. Banks that conduct business with the federal government or that have branches on military bases or other federal property are subject to the executive order and guidance. Read the guidance

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Sen. Thune Fights Proposal that Would Burden Banks and Compromise Customers' Privacy

This week, Sen. John Thune lead his colleagues, including Sen. Mike Rounds, in sending a letter to Senate Majority Leader Chuck Schumer (D-N.Y.) requesting that Democrats abandon the Biden administration’s unprecedented proposal to expand the reporting of the private, confidential financial data of law-abiding Americans from financial institutions to the Internal Revenue Service (IRS). The administration’s proposal would force financial institutions to report customer information such as gross inflow and outflow information and transaction information directly to the IRS.

“This proposal represents a radical departure from existing reporting requirements associated with national security and actual taxable events,” the senators wrote. “Placing more requirements on financial institutions would not only adversely affect these institutions and their customers—who ultimately pay the price for compliance costsbut it would also inundate the IRS with layers of new paperwork and taxpayer data that is either redundant or irrelevant to improving federal tax compliance, as account inflows and outflows are not taxable events.”

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GSB to Offer Hot Topic Online Seminar on New FFIEC AIO Booklet

The Graduate School of Banking in Wisconsin will offer the hot topic online seminar "New FFIEC Guidance—the Architecture, Infrastructure and Operations (AIO) Booklet on Wednesday, Sept. 29, at 2 to 3:30 p.m. CDT.

Released on June 30, this new guidance completely overhauled the previous IT "Operations" booklet from 2004. The new AIO booklet is a much-needed, modern take on how to manage IT operations at a financial institution and includes many new and forward-looking regulatory expectations.

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SDBA to Offer Next Week's IRA School Live in Sioux Falls and Virtually

IRA School image. The SDBA will hold its 2021 IRA School next week live in Sioux Falls at the Clubhouse Hotel & Suites and has added a virtual option to attend the school.

Days one to three of the school, Sept. 28-30, will cover new and current IRA material, and previous topics covered at the school will be expanded. The optional day four, Oct. 1, is for anyone who is involved indirectly or directly in IRA operations, reporting, auditing or compliance and will cover how the SECURE Act will affect bank operations. 

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ABA to Hold Virtual Washington Fly-In

Join banking industry peers and industry leaders from across the country for a virtual meeting with banking regulators and ABA policy experts next Monday to Wednesday, Sept. 27-29.

The ABA is hosting this year’s Washington Fly-in, in partnership with state bankers associations, to ensure policies critical to the banking industry remain front and center to agency officials and to provide a forum for bankers' questions. Don’t miss this opportunity to speak directly with regulators about the need for common-sense policies and smart reform that will help America’s banks better serve their communities and grow the economy. 

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First Interstate Bank to Partner with Great Western Bank

First Interstate Bank, headquartered in Billings, Mont., yesterday announced a definitive agreement to partner with Great Western Bank (GWB), which is headquartered in Sioux Falls.

Under the terms of the agreement, which was unanimously approved by both parties’ Boards of Directors, the companies will unite under the First Interstate name and brand. Pending regulatory and shareholder approvals, the transaction is expected to close during the first calendar quarter of 2022; the conversion of GWB branches to First Interstate is expected to take place during the second calendar quarter of 2022.

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Yellen Keeps Up Push for IRS Reporting Proposal in Spending Bill

Treasury Secretary Janet Yellen this week called on House Ways and Means Committee Chairman Richard Neal (D-Mass.) to include in the reconciliation package the Biden administration’s controversial provision that would require financial institutions to report information to the IRS on gross inflows and outflows on customer accounts above a de minimis level of $600—a provision strongly opposed by ABA.

In a letter to Rep. Neal, Yellen claimed that the proposals “were designed to ensure that there will be no increase in taxpayer burden associated with this regime” and that “for already compliant taxpayers, the only effect is a distinct benefit—a lowered likelihood of costly and burdensome audits.” In addition, the letter claimed that the provision is “designed to minimize costs for financial institutions.”

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SDBA's Fourth Annual Women in Banking Conference a Success

Photo of Women in Banking Conference attendees.Two hundred bankers from across the state came together in Sioux Falls for the SDBA's fourth annual LEAD STRONG: Women in Banking Conference. The event is designed to encourage, support and inspire women to succeed in the workplace.

The event began Tuesday evening with a reception at R-Wine Bar in Sioux Falls and continued on Wednesday with a full day of sessions at the Sioux Falls Convention Center. Topics included creating the most awesome version of you, strong communication and listening skills, how courage plays a part in leadership, overcoming imposter syndrome, building a powerful presence, roundtable networking and a panel discuss with women banking industry leaders. 

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Registration Open for SDBA's 2021 Annual Security Seminar

The SDBA will hold its 2021 Annual Security Seminar on Oct. 6 at the Hilton Garden Inn—Sioux Falls Downtown in Sioux Falls. This well-rounded seminar focuses on a range of issues of concern to security officers, facility personnel and management. 

Using current trends and examples, a variety of topics will be covered: workplace violence prevention: guideline for the employer, security blunders: show and tell, national update, interviewing techniques for the security officer and observation vs. perception.

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Bankers, Industry Experts to Discuss Cannabis Banking at Upcoming Webinar

ABA VP Tanner Daniel will join a panel of bank regulators and industry experts in a webinar on cannabis banking issues on Tuesday, Sept. 21 at 1 p.m. CDT. The webinar—hosted by Brennan Manna Diamond and co-sponsored by the Arizona and Colorado Bankers Associations and the Ohio Bankers League—will include banker perspective on offering cannabis banking service and address FinCEN guidance both deposits and lending, electronic payment systems, and legislative or regulatory changes that would promote bank participation in the cannabis industry. Learn more and register.

ABA Refreshes Credit Union Campaign

ABA’s campaign to educate the public about credit unions and their tax status has been rebranded as Reform Credit Unions. The campaign was updated to further emphasize the need to take action and demand reform to the laws and regulations related to credit unions.

The Association on Tuesday debuted a new website for the campaign that includes recent news and insights on credit union activity as well as resources to help bankers reach out to their member of Congress and voice their opinion.

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SDBA Asks Bankers to Urge Lawmakers to Oppose IRS Reporting Proposal

The SDBA is calling on bankers to contact Sen. John Thune, Sen. Mike Rounds and Congressman Dusty Johnson and express opposition to new reporting requirements for banks to track and report customer accounts and financial transactions to the IRS.  

The U.S. Senate will reconvene next week, and it is anticipated that lawmakers will develop details of the proposed $3.5 billion social spending infrastructure plan, which would have far-reaching tax reporting requirements including reporting bank account inflows and outflows to the IRS by banks. While this may do little to add revenue, it would come at a massive cost to the banking industry—and it would also heighten consumer concerns about the privacy of their banking relationships. 

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Study Shows Agriculture Continues to Drive South Dakota's Economy

The Department of Agriculture and Natural Resources (DANR) in cooperation with AgUnited for South Dakota, South Dakota Dairy Producers, South Dakota Corn Utilization Council, Central Plains Dairy Foundation and East River Electric Power Cooperative have released an economic contribution study of South Dakota agriculture.

Based on the study, agriculture, forestry and related industries contribute $32.1 billion to South Dakota’s economy, which is 29.3% of the state’s total economic output, and 129,753 jobs in South Dakota, which is 21.1% of all jobs in the state. The study also showed $11.7 billion in total value added including $5.6 billion from livestock production, $3.3 billion from corn production, $2 billion from other agriculture industries and $860 million from forestry production.

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ABA Urges Bankers: Ask Lawmakers to Oppose New IRS Reporting Rule

ABA is calling on bankers to contact their lawmakers and express opposition to any new reporting requirements for banks to track and report customer accounts and financial transactions to the IRS. A vote on the issue is expected in the coming days.

The new reporting requirements would raise questions about customers’ right to privacy, create unnecessary and expensive burdens for banks and raise the cost of tax preparation for small businesses, ABA noted.

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SDBA Bank Technology Conference to be Held Next Week

Technology photoThere is still time to register for the SDBA's Bank Technology Conference to be held Sept. 8-9, Wednesday and Thursday, in Sioux Falls. This conference will provide attendees the opportunity to learn from industry experts, network with IT colleagues, and visit with exhibitors to see and experience the latest in products and services.

Sessions at this year's event include: cryptocurrency, ransomware and disaster recovery planning, staying viable in the fintech future, how to know your security program is effective, speed networking, the art of communicating to the board and vulnerability management. The conference will begin with a reception with exhibitors on Wednesday evening. 

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ABA Opposes Bill to Expand Credit Union Membership

In a letter to House Financial Services Committee leaders on Monday, ABA expressed opposition to a bill that it called a “backdoor effort by the credit union industry to expand its membership rolls at the expense of tax-paying banks.” The Expanding Financial Access for Underserved Communities Act would allow credit unions to further expand the already broad field of membership requirements under the premise of promoting access to banking services for low and moderate-income (LMI) communities.

However, ABA pointed out that credit unions “have ample opportunity to serve additional communities under their existing authority,” and that “they have not stepped up” to provide services to LMI communities. Specifically, ABA pointed to recent data suggesting that credit unions tend to open more branches on net in upper and middle-income census tracts and close more branches in LMI areas. They are also not held to the same stringent Community Reinvestment Act requirements that taxpaying banks adhere to.

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ABA's Benda Answers FAQs on Delta Variant, COVID-19 Risk Mitigation

In a new resource guide developed at the request of bankers, ABA SVP Paul Benda answers several frequently asked questions about the recent surge in coronavirus cases connected to the Delta variant and discusses how it has changed the game. He also offers several strategies banks can use to mitigate heightened risks.

“Delta has overtaken all other coronavirus variants to become the dominant strain worldwide,” Benda writes. “[I]t’s clear that Delta is outcompeting the other strains and appears to be much more infectious.”

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Registration Open for SDBA's NEXT STEP: Emerging Leaders Summit

Photo of emerging leaders.NEXT STEP: Emerging Leaders Summit is designed to help cultivate, connect, engage and empower South Dakota’s future bank leaders. The SDBA will hold the 2021 NEXT STEP: Emerging Leaders Summit on Oct. 26-27 at the Hilton Garden Inn Sioux Falls Downtown in Sioux Falls.

This event will encourage emerging bank leaders to find and express their voices within their organizations, communities and the banking industry and provide opportunities to network and exchange ideas with other industry professionals. It will also increase emerging bank leaders’ knowledge of topics of interest to the banking industry and promote involvement and advocacy. 

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