September 22, 2021
IBANYS Weekly E-Newsletter
  • Visit our website at www.ibanys.net to review our daily updates on COVID-19.
The President's Message
By John Witkowski, President & CEO

 A reminder: Our new address is: 
Independent Bankers Association of New York State
194 Washington Ave, Suite 420
Albany, NY 12210

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Breaking News: The Federal Reserve today held benchmark interest rates near zero -- but indicated rate hikes could be coming a sooner than had been expected, while significantly cutting their economic outlook for this year. The policymaking Federal Open Market Committee (FOMC) voted unanimously to keep short-term rates anchored near zero, but a majority of members now see the first rate hike happening in 2022. In June, a slight majority put that increase into 2023. The FOMC indicated they will start pulling back on some of the stimulus the Fed has been providing during the financial crisis. There was no indication when that might happen, although the new phrasing eliminated wording that had promised to assess progress over “coming meetings” -- leading to press speculation that a formal announcement of the slowdown could perhaps come as soon as the next meeting in November.

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  • I want to draw your attention to the first item under our "Washington" section of today's newsletter discussing IBCA’s launch of a print and digital advertising campaign urging Congress to investigate the credit union tax exemption. The article also has links to several pages on ICBA's Website dedicated to their credit union advocacy efforts, which IBANYS strongly supports. These include a recent letter to the committee from ICBA Chairman Bob Fisher, President & CEO of Tioga State Bank, and a former Chairman and current board member of IBANYS. Please read through the item and join our efforts in support of the ICBA grassroots push on this issue.

  • EMPIRE STATE DEVELOPMENT has partnered with IBANYS to announce the COVID -19 Small Business Recovery Grant Program. Please distribute the information (Link below) to your small business clients so they can take advantage of the $800MM in grants from NYS. www.nysmallbusinessrecovery.com  

 
  • IBANYS and Greencheck are co-hosting a Cannabis Roundtable on September 28th - 2:00 - 4:00 p.m. Please see details below in today's newsletter to learn more and to register.

IBANYS MEETINGS
SAVE THE DATE
IBANYS Annual Convention will be held June 13-15, 2022 at the Turning Stone Resort & Casino. Mark your calendar and save the date.
ASSOCIATE MEMBERS & PREFERRED PARTNERS
Cannabis Banking in New York: Practical Guidance
Tuesday, September 28, 2021 2PM EST | 2 Hours
 
In March of 2021, New York became the 15th state to legalize adult-use cannabis — joining a growing number of states that have expanded from their initial medical-only programs. While retail sales aren’t expected to start until 2022, New York is predicted to become one of the nation’s largest markets in short order.
To help financial institutions operating in New York to prepare for a new, multi-billion dollar industry, the Independent Bankers Association of New York State and Green Check Verified are hosting the complimentary webinar, “Cannabis Banking in New York: Practical Guidance,” on September 28 at 2pm (EST). 
Taught by Green Check Verified subject matter experts, this three part educational event covers the following topics:
 
Session 1: The Fundamentals of Cannabis Banking (60 minutes)
  • Essential terminology: cannabis/marijuana/hemp, THC/CBD
  • Defining cannabis businesses and identifying their needs
  • Federal and state cannabis law, guidance, and regulations
  • FinCEN’s 2014 marijuana banking guidance: what you need to know
  • Locating and onboarding cannabis businesses
  • Ongoing monitoring and working with your examiner

Session 2: Special Considerations in New York (30 Minutes)
Every state’s legal cannabis market has its own particular challenges and opportunities, and New York is no different — especially given the potential size of the program. In this session, we explore where the New York market is headed based on comparable state programs, and what banks operating in the state need to know to safely and effectively work with this industry.
 
Session 3: Quantifying the Risks and Rewards (30 minutes)
We’ll review a case study, based on an institution that’s currently banking cannabis in a state with a new adult-use program, and use that information to conduct both a financial modeling and risk assessment exercise. From the financial modeling exercise, you will learn to identify the products and services you can (and should) offer to cannabis businesses beyond simply accepting deposits, as well as what fees can be assessed. We’ll also review the primary costs associated with running a program. The risk assessment exercise will not only help you provide a point-in-time assessment of your readiness to bank the industry but also highlight the operational decisions that must be made when working with cannabis-related funds.
 
Session 3: Special Considerations in New York (30 Minutes)
Every state’s legal cannabis market has its own particular challenges and opportunities, and New York is no different — especially given the potential size of the program. In this session, we explore where the New York market is headed based on comparable state programs, and what banks operating in the state need to know to safely and effectively work with this industry. 
 
Takeaways
  • Copies of all presentation materials
  • A cannabis banking policy template
  • A copy of the sample financial model developed during the session
  • A copy of the sample risk assessment developed during the session
  • 90-day access to a recording of both sessions

Audience
  • Board members
  • CEO
  • CFO
  • Compliance and risk officers
  • Branch operations managers
  • Business development teams

Loan Review: Best Practice Trends 
Webinar
October 5, 2021 - 2:00 pm (45 minutes)

Don’t be lulled into complacency. Regardless of what the numbers may show, regulators sense that uncertainty is looming in loan portfolios post COVID. To detect and minimize potential credit risk ahead, NOW is the time to consider best practices and industry trends that can help you conduct the most thorough and efficient loan reviews possible.

During the webinar we will discuss:
  • What’s needed to ensure highly productive and effective loan reviews 
  • Attributes for selecting a loan review partner 
  • Why document expertise and credit experience are equally critical 
  • Trending approaches for managing problem credits
  • How real-time exception clearing can accelerate the review process  
  • The new role that technology plays in making reviews faster and less complex 
  • Making better use of risk grades and their value to the institution
  • The difference between data-driven and point-in-time loan reviews
 
Following is the registration link: https://intellicredit.com/webinars.php

2021 Financial Institutions Seminar: Vital not Virtual
Join us for our annual Financial Institutions Seminar, along with our co-hosts from Luse Gorman and Piper Sandler for an in-person* and complimentary event as we deliver informative presentations and industry updates on topics ranging from strategy, cybersecurity, mergers and acquisitions, & more. Including breakout sessions specific to banks or credit unions.

Event Details:
Wed, October 27, 2021
9:30 AM – 3:00 PM EDT
Attendees will receive 4 CPE Credits
 
del Lago Resort & Casino
1133 New York 414
Waterloo, NY 13165
 
Registration, session, & CPE information:
Lessons Learned on CECL for Community Banks
Grigoris Karakoulas
Six quarters have passed since the implementation of the CECL standard by the SEC filing banks (excl Not Smaller Reporting Companies) on January 1, 2020. The community banks and credit unions are presently working towards an implementation deadline of January 1, 2023.
 
The purpose of this article is to highlight a few of the lessons learned so far in order to help financial
institutions with critical issues in the implementation of the new standard.

Marketing Promotions and Communications to Launch this Fall
Summer has come to an end and now is the time to solidify your fall marketing plans. Take the opportunity of the changing seasons to remind your account holders that your bank is there to support all their financial needs and build long lasting relationships with them through the fall and beyond. Discover three loan product campaign promotions to launch this fall and download free autumn specific direct mail and social media templates to get started on your fall marketing plans today.

News from ICBA
Community bank customers weigh in on IRS monitoring

Community bank customers have joined the industry in expressing opposition to the Biden administration’s proposal to require banks to report their customers’ account information to the IRS.
 
Consumer Alert: Consumers have already sent thousands of messages to their members of Congress opposing the plan via ICBA’s new Consumer Alert webpage.
 
Consumer Outreach Vital: ICBA is encouraging community bankers to direct their customers to the site to demonstrate public opposition extends beyond banks themselves.
 
Custom Resources: Meanwhile, community bankers are using ICBA’s customizable email and social media content to raise opposition, with the #KeepMyBankingPrivate hashtag already garnering hundreds of thousands of impressions.
 
Details: ICBA President and CEO Rebeca Romero Rainey details the multi-faceted consumer campaign—including ICBA’s custom resources—in a post on Main Street Matters and LinkedIn.
Learn Portfolio and Balance Sheet Management with your Peers
The Balance Sheet Academy advanced seminar is designed to expose seasoned community bank portfolio and balance sheet managers to advanced products and concepts. The objective of this seminar is to enable the attendees to consistently outperform their peers.

The dynamics of a community bank balance sheet require an investment professional to be versed in a widening range of topics.  Balance Sheet Academy provides discussion and practical strategies to equip the attendees for these demands. Examples of these topics include advanced interest rate risk management strategies, low cost funding strategies and strategies for serving bank customers while managing interest rate risk.

This year due to the concern for the safety of our customers and employees the event will be held virtually. Balance Sheet Academy's eight sessions will take place Monday through Thursday, October 18-21. The seminar will have two 1-hour sessions per day, and up to 8 CPE credit hours are available. 

Who should attend?
Balance Sheet Academy is structured for anyone involved in balance sheet management decision making, including CEOs, CFOs and Treasurers, particularly those who have attended Bond Academy.  It incorporates balance sheet strategies into the day-to-day management of an institution’s investment portfolio, wholesale funding and interest rate risk management. Bank personnel with an intermediate level of understanding of investments who are integral to the investment and balance sheet management 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.
Date and Time 
October 18-21, 2021 at 10:00 AM CDT and 2:00 PM CDT daily

Cost
There is no cost for Vining Sparks' customers and prospects.
 
Prerequisites 
Those working as CEOs, CFOs, investment managers, directors, and anyone responsible for balance sheet or investment portfolio management who possess the working knowledge necessary to benefit from the content of this webinar.
 
Instructions for Audio/Video
You will receive instructions to access the webinar after your registration is confirmed. If you do not receive a registration confirmation email, please contact your account representative.
Additional Information
Fields of Study: Specialized Knowledge & Economics
Advance Preparation: None
Program Level: Intermediate
Delivery Method: Group Internet-Based
Conference participants can earn up to 1 hour of CPE credit based on a 50-minute hour.
 
Questions?
For additional questions regarding this webinar, concerns and/or cancellation policies, please contact Jim Reber (info@viningsparks.com) at 800-829-0321.
Portfolios Morph
Investment securities have undergone big changes this year.
By Jim Reber

If there’s a constant in the world of a community bank investment manager, it’s disappointment. If you buy a bond today and yields go down tomorrow, you wish you’d have bought more; if yields go up, you wish you had bought none. If your overall portfolio has unrealized gains, you lament the poor yields that are available; if you are presented with attractive rates on new offerings, it means you’ve got losses on the balance sheet. 

WEBINARS
IBANYS Webinars

Are you participating in IBANYS webinars? Now is the time! IBANYS webinars provide timely, important information on subjects of interest to New York community bankers including human resources, business development, investment, compliance and security and much more. They are valuable not only for their content, but for their convenience and low-cost. Take part from the comfort and privacy of your office, without leaving the bank. 
Subscription Tokens
The More You Buy, The More You Save
 
How does it work:
Tokens can be used to purchase live or recorded webinars anytime, with no expiration! Tokens for both live and recorded webinars are available for an additional fee. (What’s the difference? Click here for the full description.)
 
Once you have your Subscription Token code, you can immediately register for webinars by using the code at checkout! (Subscription tokens not applicable for full series registrations, or other specials.)
Albany Update

  • The State Department of Labor found the statewide unemployment rate from July to August fell from 7.6% to 7.4%, but the economic recovery from the coronavirus has come more swiftly outside of New York City than within it, State of Politics reports. Employment rates across the state varied widely in the latest tally.

  • Across New York state, cities both small and middle-sized face a variety of issues, including a shrinking tax base, a drain of talent and, perhaps, a lack of attention from state government. Democratic State Senator Jeremy Cooney (Monroe County) says he's on a mission to find ways of fixing these communities. Read More

  • The Office of New York State Comptroller DiNapoli released a positive report on local sales tax collections. Not only were collections 15.5% higher than they were last year, but were also 6.5% higher than they were in 2019, prior to the pandemic. Read More

  • Representative Lee Zeldin (R-L.I.), the leading Republican candidate in next year’s race for governor in New York, announced he was diagnosed with leukemia last year and has been receiving treatment. He said he is in remission and the condition would not impact his campaign.

  • Governor Hochul issued a proclamation declaring a special election to fill vacancies in the 86th Assembly District and the 30th Senate District on Election Day, November 2nd, 2021. The special election will fill vacancies created by the resignation of Bronx Democratic Assemblyman Victor Pichardo (who had been Assembly Banks Committee Chairman, now succeeded in that position by Assemblywoman Patricia Fahy, D-Albany), and by the resignation of Harlem State Senator Brian Benjamin, who is now serving as Lieutenant Governor for the State of New York.

  • Governor Hochul announced the suspension of the state hiring freeze through the end of the fiscal year, supporting COVID-19 recovery efforts. The hiring freeze suspension comes after the Governor released the updated State Financial Plan projecting $2.1 billion in revenue above projections as the economic recovery beats expectations. State agencies may now hire without obtaining a waiver from the Division of the Budget, but must prioritize hiring for their core missions and "continue to prudently manage their resources."

Washington Update

  • ICBA today launched a print and digital advertising campaign in key states calling on Congress to investigate the credit union tax exemption and its impact on acquisitions of community banks. Ads: The print ad—which directs readers to icba.org/cuhearings for information on how local communities are affected—is scheduled to run today, later this week, and next week in editions of USA Today in Florida, Georgia, Illinois, Indiana, Michigan, and Wisconsin. Digital: The campaign will also feature online digital ads in the coming weeks urging policymakers to act on the tax exemption and growing acquisition trend. Hearing: ICBA launched the campaign as it works to focus an upcoming House Financial Services subcommittee hearing about the future of banking on credit union-bank acquisitions. Advocacy: A recent letter to the committee and a separate LinkedIn article from ICBA Chairman Robert Fisher note that these acquisitions decrease consumer access to local financial services, diminish tax revenues, and are due to the industry’s tax exemption and lax regulatory oversight. Grassroots: Community bankers can continue urging Congress to hold hearings on credit union acquisitions via a customizable message to lawmakers on ICBA’s Wake Up page and its Wake Up Messaging Playbook.


  • ICBA continues urging outreach on IRS plan. ICBA continues calling on community bankers to engage consumers against a proposal that would require banks to report customer account information to the IRS. ICBA Campaign: ICBA is calling on community bankers to use its customizable email text and social media content to urge consumers to contact Congress in opposition to the plan. Call Alert: Meanwhile, community bankers can call their members of Congress using a new ICBA call alert and customizable script the proposal. More: A recent blog post from ICBA President and CEO Rebeca Romero Rainey details ICBA’s consumer-facing campaign against the proposal, which has resulted in nearly 370,000 messages from consumers. Access custom resources.

  • Grassroots target reconciliation tax hikes. While urging consumers to speak out against the IRS reporting proposal, community bankers can also continue speaking out against proposed ICBA-opposed tax increases. Background: Budget-reconciliation legislative text includes ICBA-opposed proposals to raise rates on pass-through shareholders and C corporations, cap the Section 199A deduction, increase the capital gains tax, and impose capital gains at death. Grassroots: ICBA’s Be Heard grassroots action center allows community banks to send customizable messages to their lawmakers opposing these proposed tax hikes.


  • The U.S. Senate voted 49-48 last night to advance Rohit Chopra's nomination to lead the Consumer Financial Protection Bureau, Republican opposition held up a vote on the matter since March. Chopra could receive his final nomination vote as early as next week.

  • ICBA called on federal banking regulators to extend Community Bank Leverage Ratio flexibility given the impact of COVID-19 relief efforts on community bank capital levels. Details: ICBA asked the banking agencies to extend the 8.5% CBLR requirement through the end of 2022 to accommodate elevated deposit levels caused by emergency stimulus payments and to avoid reducing community bank small business lending. More: In its letter, ICBA also urged the agencies to: Consider allowing community banks to exclude from the CBLR denominator any cash or cash equivalent overnight investments during periods of unprecedented deposit inflows to support continued operations, and provide examiner flexibility in considering the effect of pandemic relief efforts on community bank deposits and regulatory capital levels. Background: As required by the CARES Act, the agencies lowered the CBLR to 8% in 2020 and 8.5% in 2021, with a 9% rate scheduled to resume next year. Read more.

  • ICBA urges Congress to oppose SBA 7(a) changes. ICBA told Congress it strongly opposes legislative proposals that would authorize the SBA to provide direct loans through its 7(a) program. Background: The $3.5 trillion budget-reconciliation package would provide $4.5 billion to the SBA to make direct 7(a) loans of $150,000 or less. Letter: In a letter to the House and Senate small business committees, ICBA said: 1) The SBA has a poor track record of direct lending, which is costly for taxpayers. 2) Experimenting with direct SBA lending would damage the 7(a) loan program. 3) Concerns about recent declines in 7(a) lending are misplaced due to the influence of the Paycheck Protection Program. 4) Community banks account for 66% of 7(a) loans and led the way in PPP lending. More: ICBA also pushed back against the direct-lending proposal in a national news release and in American Banker, noting it would undermine the program’s private-sector experts.

  • OCC issues proposal on rescinding CRA rule. The OCC formally published its proposal to rescind its June 2020 Community Reinvestment Act rule and replace it with interagency rules adopted in 1995. Previous: The OCC in July said it would rescind the CRA rule and work with other agencies on a joint rulemaking, which the FDIC and Federal Reserve Board affirmed in a separate statement. More: The OCC is also considering maintaining guidance on qualifying CRA activities for the period between the rescission of the rule and issuance of interagency rules, which is expected next year. ICBA Position: ICBA expressed support for the OCC announcement after previously supporting the agency’s May announcement that it would reconsider the rule.

  • CFPB: Renters at risk as relief programs end. The Consumer Financial Protection Bureau released a report warning that millions of renters may suffer as federal and state COVID-19 relief programs end. The report found that renters’ economic conditions were significantly more responsive than homeowners’ to relief measures, such as stimulus payments and expanded unemployment benefits.