Your IBANYS Team: 
Working Together To Make 2017 A Great Year 
For New York C ommun ity Banks !
 
In This Issue

Quick Links

Have You Contributed to NYSIBPAC This Year?
If not...now is the time! We need your help in this statewide election year to support candidates and committees who understand community banks' needs.  Can we count on you?
CLICK HERE
for our 2017 PAC contribution form. Help support IBANYS' political action efforts in New York State.

Partner

February 15, 2017

IBANYS is pleased to announce our newest associate member:  BCI Financial Corporation, an independently owned and operated business providing a diverse range of Auto Loans. Welcome aboard! See the "Spotlight" section of this newsletter for more information.
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KEY UPCOMING MEETINGS -- 
SIGN UP TODAY!


ICBA Capital Summit April 29-May 3:
Join Us For Key N.Y. Congressional Meetings 
Join IBANYS at the  ICBA   2017 Capital Summit (April 29-May 3) in Washington, D.C. 
It will include appearances by  top policymakers, and the new "Future of Banking" Symposium. Registration is complimentary.  IBANYS will bring a contingent of community bankers to join us 
"on the hill" for meetings with members of the New York Congressional Delegation.
With six New Yorkers  on the House Financial Services Committee, and Senator Schumer now the Democratic Leader in the Senate, we need to bring with us a significant delegation of New Yorkers to help make "the community bank case" in terms of our issues and priorities. House Financial Services Chairman Jeb
Hensarling (R-TX) will address the Summit.
ICBA is working with Hensarling to advance his "Financial CHOICE Act" regulatory relief bill. 
A number of other top policy makers -- including Vice President Pence -- have been invited as well.
Can we count on you to join us? Register below. Contact IBANYS' Steve Rice (stever@ibanys.net) to sign up for a congressional visit.   

IBANYS Compliance Conferences 
Exam Key Regulatory Concerns
Community bank compliance officers face a growing number of challenges in 2017 and beyond. Federal and state regulatory burden, "hot button" examination issues, data security, ERM, risk management, corporate governance, ADA website compliance, incentive compensation, vendor management and much more.  IBANYS' Regional Compliance Seminars March 22 in Rochester and March 23 in the Capital District offer one-day programs with senior regulators and outside consultants to address these top regulatory compliance concerns as identified by IBANYS' Compliance Peer Group. Speakers will include: 
  • FDIC New York Regional Director & Deputy Director John Vogel and Scott Strockoz; 
  • OCC National Bank Examiner Ron Castrichini; 
  • NYS DFS Deputy Superintendents Ruth Adams and Yolanda Ford & Consumer Compliance Director Mitchell Kent;
  • Steve King & Peter Rossi (Wolf & Company);
  • Charlie Graham (Volum8), and 
  • Jeffrey Cardone & Ben Azoff (Luse Gorman).
In stand alone presentations, q.and a. sessions and a concluding panel discussion, these conferences are an important opportunity to hear regulatory perspective, engage in dialogue and prepare for the chalenges ahead.

Click here to see full program and register

IBANYS Directors Conferences Set For April
Community banks are coping with evolving customer demands, while contending with shrinking margins, reduced fee income and increased regulatory costs. Bank directors are being required to do more than ever before to help banks navigate this new and difficult landscape. IBANYS' Regional Bank Directors Conferences on Tuesday, April 11 (Rochester) and Wednesday, April 12 (Capital District) will focus on a number of timely issues, and the latest Enterprise Risk management (ERM) developments to help directors identify what they must know concerning regulation, oversight and strategic planning to enhance their banks' growth and profitability. The conferences are designed for bank directors, CEOs, CFOs and other senior bank officers. Note: Attendees can earn up to 7.5 CPE credits. Program segments include updates on: 
  • Mergers & Acquisitions & How Capital Markets Drive the Process ; 
  • Cybersecurity: A Directors Guide To Cyber Threats & Security ; 
  • Enterprise Risk Management & The Role Of The Board ; 
  • How To Prepare For The Next Exam; Attracting & Retaining Millennials As Bank Customers & Employees;
  • Shareholder Succession: Capital Needs & Shareholder Liquidity
  • Plus, additional speakers & presentations To be Announced!
Click here  to see full program and to register.

Arnold & Porter Kaye Scholer Seminar:
"The OCC Fintech Charter --
Opportunity With A Twist"
Thursday, March 16, at Arnold & Porter Kaye Scholer, 250 West 55th Street, New York, N.Y. 10019. (4:30 p.m. Registration; 5:00 p.m. program; 6:30 Reception.) 
The recently proposed OCC expansion of the special purpose national bank charter for Fintech companies creates a very interesting opportunity for single source supervision of companies that provide consumer financial services without offering insured deposits. . . But at what price? 
This two-part seminar will explore the following attributes and issues that are critical to an evaluation of the OCC's proposed innovation: 
Part I: Regulatory Perspective
·           Permitted activities
·           Impact of ongoing OCC supervision and enforcement
·           Ongoing compliance expectations
·           The extent of preemption of state laws
·           Corporate governance requirements
  
Panel I Speakers 
·           Michael A. Mancusi, Partner, Arnold & Porter Kaye Scholer LLP
·           Christopher L. Allen, Partner, Arnold & Porter Kaye Scholer LLP
·           Pratin Vallabhaneni, Associate, Arnold & Porter Kaye Scholer LLP

Part II: Effect on Transactions
·           Impact on day to day transactions
·           Impact regarding state licensing requirements
·           Effect on usury caps
·           Impact on strategic transactions, including capital raising and M&A
 
Panel II Speakers
·           Henry G. Morriello , Partner, Arnold & Porter Kaye Scholer LLP
·           Robert C. Azarow , Partner, Arnold & Porter Kaye Scholer LLP
·           Lawton M. CampPartner, Arnold & Porter Kaye Scholer LLP
·           Howard GoldwasserPartner, Arnold & Porter Kaye Scholer LLP
Additional speakers to be announced.
For details, call (212) 836 8000

ICBA Securities Investment School's 
Balance Sheet Academy
ICBA Securities will hold its investment school, the Balance Sheet Academy, April 24-25, 2017 in Memphis, Tennessee. It complements the Bond Academy held last October, and is for more experience financial managers.  The Academy has a capacity of 75 bankers.  Bank personnel with an intermediate level of understanding of investments who are integral to the investment process will benefit the most from this advanced course. New directors serving on the investment or asset-liability committee will also find this course beneficial.  Balance Sheet Academy provides both discussion and practical classroom exercises.  Attendees will learn how the changing economic data impacts the bond market, and hear testimony from an experienced community banker on successful balance sheet management.
There is potential for up to 12 hours CPE credit.
Curriculum includes the following topics:  
  • Bond Markets and Investment Product Review
  • Asset / Liability Management and Impacts to Portfolio Management
  • Using Interest Rate Products to Manage Balance Sheet Exposure
  • Active Loan Portfolio Management
  • Mortgage Investing: CMO's in Detail
  • Navigating the Municipal Market
  • Understanding Municipal Credit
  • Day-To-Day Portfolio Management
  • Economic and Interest Rate Environment
  • Building and Executing Investment Portfolio Strategies
  • Formulating Balance Sheet Strategies 
For details (or to register) click on the link below, or contact ICBA Securities' Jim Reber at (800) 422-6442, jreber@icbasecurities.com.

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HERE'S A LISTING OF ALL IBANYS 
2017 MEETINGS


March 22, 2017 - Compliance Conference - Rochester

March 23, 2017 - Compliance Conference - Albany

April 11, 2017 - Directors Conference - Rochester

April 12 2017 - Directors Conference  - Albany 

April 30-May 3, 2017 - ICBA Capital Summit, Washington D.C. ( meetings "on hill" with New York Congressional Delegation)

May 9-10, 2017 - Lending Conference - Syracuse (tentative)

June 7-9, 2017 - CFO/Sr. Managment Conference - West Point, NY

September 25-27, 2017 - 43nd Annual Convention - Niagara Falls, NY  

October 24, 2017 - Security Conference - Rochester, 

October 25, 2017 - Security Conference - Albany

IBANYS Board of Directors Meetings:
  • March 2, 2017 
  • June 9, 2017
  • July 20, 2017 (conference call meeting)
  • October 19, 2017
To view details on our 2017 education calendar, visit  www.ibanys.net, click on education tab, then on upcoming meetings for full details.
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GOVERNMENT RELATIONS

ALBANY

Legislative Activity Before Two-Week Recess
The NYS Legislature is now out on break until February 28. When it returns, there will be one month left until the deadline to enact the 2017-18 state budget. However, there was some legislative activity this week of interest to community banks. T he Assembly Banks Committee reported A.1921, sponsored by Assemblywoman Peoples-Stokes, D-Erie (same as S.2461, sponsored by Senate Banks Chairman Hamilton, IDC-Brooklyn) to the Assembly Ways & Means Committee. It would require inclusion and explanation of additional annual data in assessing record of performance of banking institutions in meeting community credit needs. Additional data would include, but not be limited to, loans for housing low and moderate income residents and areas, the scope of efforts to market housing and small business loans in low and moderate income areas. IBANYS is opposed to this legislation.

Flanagan: Senate Coalition To "Remain Intact"
GOP Senate Majority Leader John Flanagan (R-L.I.) said the Senate's "working majority" with Independent Democrats (IDC) will "remain 100% intact" during theongoing feud between "regular" Democrats and the IDC.  The 63-seat Senate include eight IDC members, 23 regular Democrats, 31 Republicans and Sen. Felder of Brooklyn, a registered Democrat who sits with the GOP. Sen. Perkins (D-Harlem) this week won a special election for New York City Council, where he previously served, and will resign from the Senate. Gov. Cuomo will need to call a special election to fill that seat. The vacancy leaves the number of enrolled Democrats at 31, and an even number of senators (62) in the chamber.

Schneiderman Opposes Expanded
DFS Authority 
In a letter to Governor Cuomo and legislative leaders, State Attorney General Schneiderm opposed the Governor's  proposal to expand the civil law enforcement authority of the State Department of Financial Services (DFS). Schneiderman has called the proposal, which is included as part of the Governor's proposed state budget,  "a wholly unnecessary overreach by the Executive (that)...should be rejected by the legislature. A Cuomo spokesman responded: "DFS has proven itself to be a powerfulk and widely respected financial regulator and we believe we should have more cops on the beat, not less. Turf battles are counterproductive to effective policing of the market."

WASHINGTON, D.C.

Fed's Yellen: Ease Reg Burden On Small Banks
Federal Reserve Chair Janet Yellen told members of the Senate Banking Committee yesterday that she favors adjusting financial regulations so they are less burdensome on small banks. Chair Yellen noted Congress could exempt small institutions from some Dodd-Frank regulations, noting as examples the Volcker Rule (ban on proprietary trading) and restrictions on incentive-based compensation.  She noted the Fed has already addressed regulatory complaints, including making the bank exam process easier for small banks, and stated:  "It's important to look for every way we can to mitigate the regulatory burden," Yellen said.  However, she said "all firms" including community banks should be required to follow capital standards. She said the Fed is not subject to the President's recent executive order requiring regulators to rescind two regulations for each new rule promulgated, but stated that easing regulations in line with its goal is appropriate.

In her testimony today before the House Financial Services Committee, Yellen acknowledged the economy is weak, but said Fed policies have been a help, not a hindrance. Chairman Jed Hensarling (R-TX) told Ms. Yellen Congress does not believe the Fed has "found the proper balance" between regulation and growth. 

Meanwhile, Federal Reserve Board Governor Daniel Tarullo will resign effective on or around April 5. He was appointed by President Obama in 2009 for an unexpired term ending Jan. 31, 2022. Tarullo has been the Fed board's top official focused on financial regulation in the wake of the financial crisis, having served as chairman of its Committee on Supervision and Regulation. Congressional Republicans have called for the apointment of a Vice Chairman to oversee such activities.

A Roll Back Of Sarbanes-Oxley Audit Rule?
The U.S. Chamber of Commerce is aong several business groups urging a roll back of a Sarbanes-Oxley Act provision requiring companies to audit their internal fraud and error controls. A revamped version of House Financial Services Committee Chairman Jeb Hensarling's Financial CHOICE Act is expected to expand exemptions to the provision.

Mnuchin Confirmed Treasury Secretary;
To Coordinate Financial Regulatory Reform 
By a vote of 53 to 47, the U.S. Senate has confirmed former Goldman Sachs banker  Steven Mnuchin as Secretary of the  Treasury. Mnuchin will play a key role in the administration's plans to overhaul the tax code and renegotiate trade deals. President  Trump has also empowered Mnuchin to immediately play a key role in financial regulatory reform, directing him to confer with other top regulators and report back on potential changes  within four months . Secretary  Mnuchin will do so as Chairman of the Financial Stability Oversight Council, which coordinates oversight across agencies.

By a vote of 81-19, the Senate also confirmed Linda McMahon as head of the Small Business Administration.

Other Washington Updates:

OCC issued a bulletin on its January 23 final rule designed to ease burden on national banks and federal savings associations. It removes certain notice and disclosure requirements, simplifies certain licensing rules for mutuals and clarifies national bank director oath requirements.

ICBA urged federal regulators to assure that proposed cybersecurity standards for financial institutions with assets of more than $50 billion don't "trickle down" to impact community banks


ASSOCIATION & INDUSTRY INSIGHTS

Consumer Prices Are Up
U.S. consumer prices recorded their biggest increase in nearly four years in January. Households paid more for gasoline and other goods. The Labor Department said today its  Consumer Price Index  jumped 0.6% last month after gaining 0.3% in December. The January increase in the CPI was the largest since February 2013.  In the 12 months through January, the CPI increased 2.5%, the biggest year-on-year gain since March 2012.  The CPI rose 2.1% in the year to December.

. . .And, So Are Delinquencies 
According to the Mortgage Bankers Association, Federal Housing Administration mortgage delinquencies jumped in the fourth quarter of 2016 for the first time since 2006. The FHA, which insures low down-payment loans, is a favorite among first-time homebuyers.  The seasonally adjusted FHA delinquency rate increased to 9.02% in the fourth quarter from 8.3% in the third quarter. The increase followed the lowest delinquency rate since 1997. It was driven by loans made since 2014 and early-stage delinquencies -- those just 30 days past due.
 
. . .And, Retails Sales Also Rose
The U.S. Commerce Department reported that U.S. retail sales rose more than expected in January, as households bought electronics and a range of other goods. R etail sales increased 0.4% last month. December's retail sales were revised up to show a 1.0% rise, instead of th e previously reported 0.6% advance. January' s upbeat came despite the biggest drop in motor vehicle purchases in 10 months.  Compared to January 2016, sales were up 5.6%.  Excluding automobiles, gasoline, building materials and food services, retail sales increased 0.4% after an upwardly revised 0.4% gain in December.

. . .But, Homebuilders Confidence Is Down
After a sharp jump following the presidential election, confidence among U.S. homebuilders continued to slide in February. The National Association of Home Builders reported that the monthly sentiment survey fell 2 points, to a level of 65. Anything above 50 is considered positive. The survey stood at 58 in February 2016. It hit a recent high of 69 in December. These so-called "core" retail sales correspond most closely with the consumer spending component of gross domestic product.

Please Support NYSIBPAC. . .
Watch your inboxes for our 2017 NYSIBPAC solicitation request. This year brings a challenging legislative session that will feature new chairmen of both the State Senate and State Assembly Banks Committees. With many of our competitors within the financial services industry operating very well-funded political action committees, we need your support to ensure community banks remain an important part of the political process and debate. We have placed an updated 2017 NYSIBPAC contribution form in the column along the left border of this newsletter. 
Can we count on your support?

. . .And Also, The ICBPAC 
Silent Auction
Bob Fisher, President & CEO of Tioga State Bank, is Co-Chair of the 28th Annual ICBPAC Silent Auction to be held Tuesday, March 17, 2017 during ICBA's Community Banking LIVE™ in San Antonio, Texas. BobFisher It is a vital part of the ICBA PAC program. Bob is asking his fellow new York community bankers to help to make this year's event the biggest yet.
Please consider supporting it through sponsorship or a gift donation. Your bank may use corporate funds to help make the Auction a success.  Even if you don't attend, a sponsorship or donation would be appreciated. V isit  www.icba.org/auction  for details. P lease note the deadline to be recognized as a sponsor or gift donor in the Auction Program is  Friday, February 3 . If you have any questions regarding the event or ICBPAC, contact Courtney Schoenborn or Martina Egerer at  (800) 422-8439  or email  auction@icba.org
 
 

ICBA's Annual national convention "Community Banking LIVE" in San Antonio, Texas March 15-19  is the largest community banking convention in the country. Devoted solely to the needs of America's independent community banks, it provides community bank decision-makers nationwide the opportunity to network and gain valuable insight into their business, competition in the marketplace and the special financial challenges we are facing today. Visit www.icba.org for details.


MEMBER SERVICES & BENEFITS


 
IBANYS identifies offers products and services  that provide value to your banks, companies, employees communities. These brief summaries provide links for information. Please contact IBANYS President John Witkowski with questions. 

Health & Wellness 
The health and wellness landscape continues to evolve. "My Wellness Resource" can be a nice addition to your existing benefit package.   C ontact Alan Justin at (716) 907-5500  or visit:  http://nbibanys.phecard.com.

Secure, Enhanced Internet Presence
The .bank program by fTLD operates trusted, verified, more secure and easily-identifiable locations on the Internet for financial companies and the customers they serve. Visit www.icba.org/SRPArticles<http://www.icba.org/SRPArticles
> page  

Online Lending
Excelsior Growth Fund (EGF) is NYBDC's nonprofit Community Development Financial Institution and IBANYS' exclusive online lending  partner . Visit 

Battling Prostate Cancer
Cure the Blue" raises funds and awareness regarding prostate cancer in New York State. Visit www.curetheblue.com to get involved!  
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IBANYS 2017 Webinars Designed 
For  New York Community Banks 
In 2017, New York's community banks will face an array of challenges -- and, opportunities! Bank officers, board members and employees must be sure they are fully informed and up-to-date on their responsibilities -- and, about their potential liabilities. Community bankers require the proper information and tools to effectively meet their responsibilities, execute their business and strategic plan, and prepare the bank for the future.  One important -- and convenient --way to do so is by regularly participating in  IBANYS' 2017 webinars. These presentations are specifically tailored to the needs of New York community banks. The programs are effective and cost-effective, and to participate couldn't be easier! Community bankers can do so directly from their own offices. Over the past few years, the number of New York community bankers participating in IBANYS' webinars has dramatically increased.  Is your bank among those who have benefited? If not, why not find out why so many of  your industry and association peers are taking advantage of these timely webinars? Take a moment to r eview our upcoming programs by clicking the link below:
https://financialedinc.com/a/ibanys/category/live

. . .  BCI Financial Corporation
BCI Financial Corporation is an independently owned and operated business providing a diverse range of Auto Loans.  Since 1998, BCI has provided customers a strong lender for their auto loan needs while giving financial institutions and dealers a resource that they can trust to get loans done consistently!  Their experienced and knowledgeable staff  provides a range of financial services to individuals and other financial institutions that include:
  • BCI has a strong commitment to excellent customer service. Their highly qualified staff will assist with any issues and work to make customers' experience great.
  • BCI works with dealers in a large network to provide excellent loan products at rates that are competitive in the marketplace.
    BCI works with financial institutions to provide loans and a servicing platform that is state of the art.
BCI's management team has deep roots in the business and the community bank industry.  Call (203) 439-9400 (ext. 7003)/Toll Free (866) 224-2677. Or, v isit the website: bcifinancial.com. 

 
. . .that when Steven Mnuchin was sworn in as Secretary of the Treasury this week, he became the 14th New Yorker -- and, the third straight -- to hold the position. Who were the others? 

Alexander Hamilton (1789-95); 
John Spencer (1843-44); 
John Dix (1861); 
Charles Folger (1881-84); 
Daniel Manning (1885-87); 
Charles Fairchild (1887-89); 
George Cortelyou (1907-09); 
Ogden Mills (1932-33); 
William Woodin (1933); 
Henry Morgenthau (1934-45); 
Robert Rubin (1995-99); 
Timothy Geithner (2009-13); 
Jack Lew (2013-17).


 

 New York community banks play a key role in our state and local economies. Help spread the good news among your customers, business and elected leaders and media!

Click here for quotes from Governor Cuomo and DFS Superintendent Lawsky extolling the performance and value of New York community banks.

Click here for the full NYS Study on community banking.

Click here to read IBANYS President & CEO John Witkowski's comments on the new tax changes and benefits for New York community banks as approved in the 2014-15 State Budget.

 

Click here for IBANYS' letter to the Editor of Consumer Reports Magazine correcting failure to mention community banks as an alternative to using "big banks."

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John J. Witkowski
President and Chief Executive Officer
 
Stephen W. Rice
Director of Government Relations and Communications

Linda Gregware
Director of Administration and Membership Services 

William Y. Crowell, III
Legislative Counsel