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Alyssa, don't miss these important MBA updates...
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PROFESSIONAL DEVELOPMENT
2024 Session of MBA Perry Schools of Banking
We are hosting the best and the brightest from the industry this week during the MBA Perry Schools of Banking at the Kellogg Center at Michigan State University. MBA is committed to helping students reach their full potential in their banking careers.
To view more photos and to learn more, watch out for the July/August mbaBanking magazine issue at the end of July.
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GRADUATE SCHOOL OF BANKING
Graduate School of Banking at UW–Madison Welcomes New Leadership
The Board of Trustees of the Graduate School of Banking at the University of Wisconsin–Madison (GSB) announced that Paul C. Katz has been selected as the next GSB/Prochnow Educational Foundation (PEF) president and CEO. Katz succeeds Kirby Davidson, who announced his retirement in October of 2023. Katz will begin as president on June 1, and assume the role of CEO upon Davidson’s retirement on December. Learn more.
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DEBIT CARD INTERCHANGE FEES
Michigan Bankers Association Urges Reevaluation of Proposed Regulation II
In a recent letter addressed to Chairman Powell, we voiced concerns over Regulation II: Debit Card Interchange Fees and Routing [H.R.-1818]. Here are the key points highlighted in their communication:
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Importance of Debit Interchange: Debit interchange plays a crucial role in the revenue mix of member banks, enabling them to offer lower-cost services to customers, particularly those who are at-risk or previously unbanked.
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Impact on Low and No-Cost Banking: The proposed rule threatens to have a significant negative impact on offering low and no-cost banking services at a time when efforts are underway to bring more un and underbanked individuals into the financial system.
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Competitive Landscape: Debit interchange allows smaller banks to remain competitive in a marketplace that favors scale. Reductions in non-interest revenue could pose survival challenges for smaller institutions.
- Trickle-Down Effect: While the rule targets larger institutions, past experiences, such as the Durbin amendment, have shown a trickle-down effect on community banks, exacerbating the impact on smaller players.
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Call for Scrutiny: The association urges better scrutiny of the data used and evaluation methods to consider all relevant costs to financial institutions, including those related to card production, account maintenance, and fraud prevention.
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Consumer Impact: Contrary to expectations, the proposal is unlikely to benefit consumers, as past experiences suggest that savings by retailers are not passed on to them. Furthermore, it could discourage investment in fraud detection and prevention, harming the overall health of the U.S. payments system.
Read the letter.
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LANSING
House and Senate to Pass State Budget
Appropriations work soaked up all of the air in the room this week in Lansing as both the House and Senate hammered out negotiations on a state budget. The House passed their budget bills on Wednesday and the Senate is expected to finalize passage of their version of the budget today. The bills with then go to a bi-cameral conference committee where both chambers will agree upon a final package.
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CANNABIS
Cannabis Banking Survey
Responses are needed by May 22.
Despite the recent announcement that the Drug Enforcement Administration intends to reclassify marijuana from a Schedule I to a Schedule III controlled substance, that shift does not legalize cannabis at the federal level, and therefore does not enable banks to serve state-licensed marijuana businesses without the risk of federal enforcement action. However, it may create helpful momentum for the SAFER Banking Act, which would allow banks to serve state-licensed cannabis businesses in states where the activity is legal – and we need your help to inform that advocacy.
Please take this short survey which will help ABA educate policymakers about the current availability of financial services for cannabis-related businesses. The goal of the survey is to determine how many banks are currently providing financial services to cannabis businesses, which products are available at what volume, and how potential policy changes (passage of SAFER Banking or similar legislation, re or de-scheduling of cannabis as a Controlled Substance) might impact the marketplace.
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MICHIGAN BANKERS ASSOCIATION
Mitin to Retire
All of us at the MBA are grateful for the many contributions of Debbie Mitin over the last 25+ years. We wish her all the best as she prepares for retirement on June 7th. To wish Debbie well you can email her at dmitin@michigan.bank.
| Join us July 9-10, for roundtable discussions with key stakeholders including the Federal Reserve Bank of Chicago leadership, the FDIC, and the OCC as part of our annual Chicago Regulatory Visits. | |
REGULATORS
Ask the Fed: CRE Turbulence Ahead
Wednesday, May 29 | 2:00 pm to 3:15 pm EST
Will 2024 Commercial Real Estate (CRE) weather the storm, or is it just under the weather? CRE continues to benefit from a healthy economy, including robust job growth, strong consumer spending and available credit. But the industry is also beset by a challenging interest rate climate, appraisal issues, oversupply, falling rental rates and increasing expenses. Additionally, increasing CRE delinquency rates and loan losses are presenting challenges to some financial institutions.
Join Brian Bailey CRE, CCIM, as he discusses trends and emerging risks in the CRE and CRE finance industries on Wednesday, May 29, at 2 p.m. (EST). The webinar will be presented live from the offices of the Texas Department of Banking, Austin, Texas.
Registration is open now at www.askthefed.org. As always, we encourage and appreciate your questions on this topic. You can email your questions in advance of each session to questions@askthefed.org.
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REGULATORS
2024 OCC Mutual Forum - June 25
You are invited to attend the 2024 Office of the Comptroller of the Currency Mutual Forum on Tuesday, June 25. The link to register is below. Speakers on the Mutual Forum will include the Acting Comptroller of the Currency, senior OCC Staff and mutual bankers. The Mutual Forum will begin with registration starting at 9:30 am Eastern Time and conclude at 5:00 pm Eastern Time. The program will begin at 10:00 am Eastern Time. There will be a welcome reception beginning at 5:30 pm on Monday, June 24. Register here.
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REGULATORS
Some Banking Agencies Seek to Place Restrictions on Incentive Compensation
Banking and housing regulators reintroduced a 2016 proposed rule to establish new limits on incentive compensation at institutions with at least $1 billion in assets. However, the Federal Reserve and the Securities and Exchange Commission did not join the other agencies in proposing the rule, despite the Dodd-Frank Act requirement that all the agencies must jointly work on the effort. In addition, FDIC Chairman Martin Gruenberg said the proposal won’t advance unless all of the required agencies sign on.
Section 956 of the Dodd-Frank Act requires the Fed, FDIC, OCC, National Credit Union Administration, SEC and Federal Housing Finance Agency to jointly issue regulations or guidelines to prohibit incentive-based compensation arrangements that encourage excessive risk-taking at financial institutions with at least $1 billion in assets. The 2016 draft being re-proposed creates a three-tiered approach based on the size of the institution, from $1 billion to $50 billion, $50 billion to $250 billion and more than $250 billion, with larger institutions subject to stricter requirements. ABA at the time raised multiple concerns about how the proposal failed to consider individual banks’ business models and risk profiles. The rulemaking failed to advance.
Read a memo on the proposal.
Read the proposed rule.
Read ABA's comments on the 2016 proposal.
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REGULATORS
Agencies Release Third-Party Risk Management Guide for Community Banks
The Federal Reserve, FDIC and OCC on Friday released a new guide to help community banks develop and manage third-party risk management practices. Among other things, the guide states that engaging a third party does not diminish or remove a bank’s responsibility to operate in a safe and sound manner, or to comply with legal and regulatory requirements, just as if the bank were to perform the service or activity itself. Download the guide. View the guidance.
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ANTI-MONEY LAUNDERING
FinCEN Director Offers Tips for Filing Suspicious Activity Reports
Financial institutions can improve the value of their suspicious activity reports for law enforcement by taking steps such as providing citations and identifying known ties to foreign countries, Financial Crimes Enforcement Network Director Andrea Gacki said Monday. Speaking at an anti-money laundering conference in New York City, Gacki said her agency received nearly 119,000 SARs between April 1, 2022, and March 31 of this year, for an average of 5,000 a month. Given the importance of SARs to law enforcement, she shared three best practices for increasing their utility for FinCEN. Read Gacki’s remarks.
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This full-day program is one of the country’s most comprehensive seminars on opening deposit accounts. The
session answers many of the complicated questions customers and employees ask. The 200+ page detailed
manual, included in the registration and customized to your state law, has become an invaluable resource for
banks across the state. These workshops are highly interactive. Come prepared to get your questions answered!
You are encouraged to bring a copy of your bank’s signature card, account agreements, terms and conditions
and resolutions.
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Join us online for this deep dive into Fair Lending practices and the Community Reinvestment Act! Led by Patti Joyner, this session will guide attendees through:
Fair Lending:
- Continued Focus on Redlining: Geographic Lending Patterns
- Equal Credit Opportunity Act (ECOA)
- Housing Agencies’ Fair Lending Oversight
- Appraisal Bias and Re-considerations of Value (ROV)
- Appraisal Discrimination: Application of the Fair Housing Act and Risk Mitigation
- Fair Lending and Consumer Risks in Artificial Intelligence (AI) and Machine Learning (ML)
CRA Modernization:
- CRA Examination Categories:
- Geographic Assessment Focus
- CRA Examination Tests
- Performance Test and Overall Performance Ratings
- Impact of discriminatory or illegal credit practices
- Eleven Community Development Categories
- Data Collection and Reporting
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PROFESSIONAL DEVELOPMENT
Ask the Experts: Third-Party Risk Management
May 23 | 2:00 PM - 3:00 PM CDT
Third-party risk management is one of the top compliance pain points facing organizations today. Vendor managers struggle to request and process high volumes of due diligence documents, while risk from third parties continues to increase.
Join our experts Alyssa Pugh and Leticia Saiid as they generate conversation for best practices related to third-party risk management while answering your questions live.
In this session our experts will touch on subjects like:
- Best practices for quickly and accurately processing due diligence documents
- Tips and tricks for negotiating new or existing contracts
- When to accept risk and when to evaluate other options
- Ways to organize your data and delegate responsibility
Our “Ask the Experts” sessions are designed for you to ask questions of our experts in the fields of information security and vendor management.
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MBA SERVICE CORPORATION
Q4 Global Economies in Flux: Drive Decisions with the Purchasing Managers’ Index™
Thursday, May 16 | 10:00 am - 11:00 am EDT
Join Chief Business Economist, Chris Williamson and fellow Senior Economist, Jingyi Pan for the 2024 Q2 economic outlook through the lens of the Purchasing Managers' Index data. With economic conditions changing rapidly, recession risks receding and inflation proving more stubborn than many anticipated, we analyze the latest data and provide an assessment of the global economic and business environment.
Join this webinar to:
- Understand what are the current economic growth drivers, how different economies diverging, and what detailed sector PMI data tell us about near-term economic prospects
- See variations in data by country and sector to assess how the inflation environment is developing, including how price trends are diverging among the major economies. Over the past year, the PMI price data have been characterized by an end to the dis-inflationary trend in manufacturing alongside stubborn wage-led price growth in services
- Get an outlook on the resilience of labor markets
- With the US dollar strength posing a problem for many emerging markets, and risks reigniting inflation in many economies, understand the outlook for the APAC economies in this more challenging environment
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MBA SERVICE CORPORATION
SBS Educational Resources
Join SBS CyberSecurity's monthly Cyber Showcase as we look back on the Interagency Guidance, discuss what the impact has been in the short-term, and what you can be doing to ensure your vendor management program is compliant and effective. The Cyber Showcase is a free monthly webinar series. Learn more.
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MBA SERVICE CORPORATION ENDORSED PARTNER
The Latest from Compliance Alliance
View the Compliance Alliance Question of the Week.
Banking Matters Podcast - Learn about today’s financial trends, topics, and practical matters on the Banking Matters Podcast. Listen to new episodes every Monday! Listen now.
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#FrameofMindFriday ~ May is Mental Health Month join us for a month of tips, tools, and reminders: https://conta.cc/4146eRO | |
A great day of learning at the MBA Perry Schools of Banking! #FutureLeaders | |
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Calling all college juniors and seniors in business or finance! Explore the incredible opportunity of the George Harding Scholarship at bit.ly/GeorgeHardingScholarship. Secure your future today!
#ScholarshipOpportunity #FinanceMajor
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