August 5, 2020
IBANYS Weekly E-Newsletter
  • Visit our website at www.ibanys.net to review all our daily updates on COVID-19 beginning on March 16.
The President's Message:
IBANYS News and Updates
By John Witkowski, President & CEO

Updates On Community Banks & Small Businesses
 
The special relationship between New York community banks and local small businesses was clearly demonstrated during the pandemic and the Paycheck protection Program (PPP).
 
  • A recent Wall Street Journal article noted that many small businesses have switched from large banks to community banks amid the COVID-19 pandemic because of their successful implementation of the Paycheck Protection Program. The article pointed out that community banks "punched above their weight" when it came to the PPP, with banks under $10 billion in assets accounting for 14 percent of banking industry assets but 52 percent of PPP loans and 44 percent of approved funds. 
 
  • In addition, a recent ICBA Main Street Matters post broke down PPP loan data, confirming that community banks have led the way in supporting the economic recovery in local communities

  • State Comptroller DiNapoli said that $38.2 Billion In PPP loans helped 72% Of New York small businesses
 
With Congress now debating the next stimulus package, including what comes next for the PPP, ICBA is urging community bankers to use its Be Heard grassroots action center to urge Congress to advance PPP reforms as well as capital, accounting, and tax relief. IBANYS joins in that request.
 
Stay safe and healthy! 


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As New York community bankers continue to reopen their lobbies and branches (with safeguards in place to keep their staff and clients safe and healthy as we adjust to the “new normal”) and while others take a more guarded approach, IBANYS continues to gather and disseminate to banks information on reopening and operational strategies and updates from the regulatory agencies and other resources.
 
If you have information you would like to share or have a comment about the newsletter, please email me at johnw@ibanys.net.

IBANYS Welcomes our Newest Associate Member - Upgrade
Upgrade provides a suite of asset options to community banks.

Jim Quinn
Director of Financial Institution Partnerships
(919) 306-1211

IBANYS VIRTUAL CONVENTION
SAVE THE DATES
September 30 - October 1-2, 2020
IBANYS is adapting to the new normal brought about by the pandemic including switching our 2020 Annual Convention to a “Virtual” Convention this fall. The 2020 IBANYS “Virtual” Annual Convention is scheduled for Wednesday, September 30 – Friday October 2, 2020. Banks can register for one price, and the event will be open for all bank employees. Look for more details coming soon. We are working on the agenda, have confirmed a number of outstanding speakers, and are greatly appreciative of the generosity shown by our convention sponsors.

If you would like to be a sponsor, please contact me at johnw@ibanys.net or 518-436-4646 for details.
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
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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.)
IBANYS Preferred Partners & Associate Members
The NextGen Scholarship is Back!
The LEAD FWD Summit is Sept. 21-22 and offered in virtual format
 
Due to the success of last year's NextGen scholarship program, we are excited to announce that ICBA is once again offering this exciting scholarship opportunity for our state association friends.
 
With the ICBA 2020 NextGen Scholarship you have an opportunity to award one community banker from your membership a fully-paid scholarship to ICBA's virtual leadership conference, the 2020 LEAD FWD Summit (Sept. 21-22).
 
This is your scholarship to award to a deserving community banker in your state! We’re thrilled to assist you in further engaging the future of our industry and we’re delighted to partner on this NextGen Scholarship opportunity. For more details, including how to participate, please refer to this informational brief and our ICBA State and Regional Partner web page where you will find customizable promotional tools and assets.


ICBA Offers New Guide On SBA Lien Requirements EIDLs
ICBA posted a new guide to Small Business Administration lien requirements on Economic Injury Disaster Loans after seeking SBA input on its treatment of EIDLs. The guide notes that EIDL loans over $25,000 require a blanket Universal Commercial Code lien allowing the SBA to take an interest in the assets of the business. It also says the SBA does not prohibit lenders with a superior lien position to the UCC-1 lien to continue advancing additional funds under existing borrowing arrangements. The guide also provides SBA contact information for borrowers and lenders seeking consent for subordination, and it links to additional EIDL resources from SBA. Additional information on the federal pandemic response are available in ICBA's frequently asked questions on COVID-19. View the EIDL guide. 
Albany Update
DFS FAQ On Forbearance For Residential Mortgages Held In Portfolio By NYS Chartered Banks
The NYS Department of Financial Services (DFS) has issued the "Frequently Asked Questions (FAQ) document on the state's new Residential Mortgage Forbearance Law on forbearance for residential mortgages held in portfolio by NYS chartered banks. IBANYS would like to thank the DFS team for providing guidance through this document, which IBANYS had suggested.
The FAQ document may be accessed through the link below.
 
 
Legislature Prepares To Reconvene -- Forbearance Likely On Agenda
The Legislature is expected to reconvene in two weeks, and will likely take up additional forbearance legislation for residential and commercial investment property mortgage payments. That may well include. A.10532A, Bichotte (see link below). IBANYS opposes the legislation (see second link below), and is working with the Legislature and the NYS DFS.
 
 
Comptroller DiNapoli: $38.2 Billion In PPP Loans Helped 72% Of new York Small Businesses
State Comptroller DiNapoli reports that $38.2 billion in PPP loans were approved for New York applicants through July 24, 2020, according to data from the U.S. Small Business Administration (SBA), which implements the program. DiNapoli noted the PPP helped 72% of New York small businesses, but urged that that it must boost aid to underserved communities. report by the SBA’s Inspector General found the agency did not adequately address the needs of traditionally underserved businesses: “Because SBA did not provide guidance to lenders about prioritizing borrowers in underserved and rural markets, those borrowers, including rural, minority and women-owned businesses, may not have received the loans as intended.” In addition, SBA has been criticized for publishing certain potentially inaccurate data on the program’s outcomes.
 
 
Cuomo Still Opposes New Taxes On The Wealthy
Governor Cuomo still refuses to support taxes on the ultra-wealthy, saying that rich people already have one foot out of New York City, and he fears they’ll leave for good if their taxes go up, Gothamist reports.
Washington Update
Feds Release Risk Management & Consumer Protection Principles For Financial Institutions
Federal regulators released risk management and consumer protection principles for financial institutions to consider while working with borrowers as initial coronavirus-related loan accommodation periods come to an end. The Federal Financial Institutions Examination Council statement encourages financial institutions to consider prudent options for additional accommodations that can ease cash flow pressures on affected borrowers, improve their capacity to service debt, and facilitate prudent loan management.
 
 
ICBA to Congress: Heed the Economic Recovery Experts
With new Small Business Administration data showcasing the outsized role of community banks in serving small businesses and underserved communities amid the COVID crisis, the Independent Community Bankers of America (ICBA) is urging the Senate to incorporate needed reforms in the next round of stimulus legislation.
 
SBA’s data demonstrates the overwhelming effectiveness of community banks in serving underrepresented small businesses via the Paycheck Protection Program. Community banks delivered the most PPP loans to:
 
  • Minority-owned small businesses (72.6 percent).
  • Women-owned small businesses (71.5 percent).
  • Veteran-owned small businesses (63.4 percent).
 
Further, community banks served 98.2 percent of low-income or economically distressed counties, 96.6 percent of rural counties, and 92.4 percent of urban counties while processing PPP loans five to 10 days faster than other lenders.
 
"As the Senate debates the next stimulus package, lawmakers should heed the recommendations of the nation's community banks, which account for more than two-thirds of Paycheck Protection Program loans to small businesses," ICBA President and CEO Rebeca Romero Rainey said. "In the face of ongoing economic challenges, community banks are calling on Congress to advance specific policies that will have a meaningful impact on small businesses and jobs in local communities across America."
 
ICBA is calling on Congress to advance provisions in the Senate stimulus draft proposal to provide an intermediate forgiveness process for PPP loans under $2 million and streamlined forgiveness for loans under $150,000, an ICBA-advocated policy in bipartisan legislation (S. 4117/H.R. 7777) that Treasury Secretary Steven Mnuchin recently called on lawmakers to consider. As detailed in specific stimulus recommendations to Congress, ICBA and 42 state community banking associations are also advocating an online PPP loan-forgiveness calculator, liability protections from COVID-19-related lawsuits, and additional relief to help community banks support the economic recovery.
 
As the debate progresses, ICBA will continue working with Congress and the Trump administration to implement policies that will help community banks lead the economic recovery in local communities.
 
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Will Stalemate On Negotiations Lead Trump To Use Executive Orders To Halt Tenant Evictions?
Negotiations continue among the White House, Senate GOP and House Democrats, and there does not appear to have been significant progress made. Here Are the Differences to date Between the House and Senate Coronavirus Relief Bills.” https://nyti.ms/3jXCrpZ. With negotiations at a stalemate, President Trump said he'd consider using executive orders to halt tenant evictions and lower payroll taxes, actions that would come after unemployment benefits for nearly 30 million workers expired last week, as did a federal pause on evictions. Meanwhile, Senate Banking Chairman Crapo (R-Idaho) a letter to housing and bank regulators urging them to use their existing authority to continue eviction protections and looser lending rules — in effect doing "an end run" around Congress.
 
The Small Business Administration released frequently asked questions on Paycheck Protection Program loan forgiveness. The FAQs address loan-forgiveness applications, payroll and nonpayroll costs, owner-employee compensation, reductions in the forgiveness amount, and more, including new guidance on issues such as covered utility payments and eligible electricity supply charges. The SBA recently said its new platform for submitting PPP loan-forgiveness applications and decisions to the agency will go live this Monday, Aug. 10. Additional guidance and resources are available on Treasury’s PPP webpage and ICBA's COVID-19 resource center. Meanwhile, ICBA continues calling on community bankers to use its Be Heard grassroots action center to urge Congress to advance PPP reforms as well as capital, accounting, and tax relief.
 
ICBA Seeking ILC Grassroots Outreach
ICBA continues calling on community bankers to urge their senators to co-sponsor legislation to close the industrial loan company loophole. The customizable message on ICBA's Be Heard grassroots action center notes that ILCs pose a significant risk to the financial system and should be regulated like other banking institutions. The Eliminating Corporate Shadow Banking Act (S. 2839) would subject ILCs to the Bank Holding Company Act.
ICBA recently called on the FDIC to deny Rakuten Bank America’s resubmitted ILC application and urged the agency to strengthen its proposal to enhance oversight of ILC parent companies.
 
Through its "Wake Up" campaign, ICBA will continue encouraging policymakers to open their eyes to the risky practices, costly tax subsidies, and irresponsibly lax oversight of tax-exempt credit unions.
Additional Information
  • Top executives of more than 100 companies - including Starbucks, Microsoft and Mastercard - and trade groups urged Congress to backstop small businesses facing economic calamity. With a new coronavirus relief measure stalled in Congress, the CEOs have banded together to send a message to Washington: Get money to small businesses now: "By Labor Day, we foresee a wave of permanent closures if the right steps are not taken soon."
 
 
  • When the pandemic eventually subsides, roughly one-third of New York City’s 240,000 small businesses may never reopen, according to a report by the Partnership for New York City, an influential business group, the Times reports.