July 8, 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

"A Status Check: Surviving The Change, Protecting Our Future -- Together"
The pandemic and the enormous impact it has had on our industry illustrated the importance of having a community bank trade association working for and representing your interests. During these times of disruption, community banks needed to focus on day-to-day business operations, and simultaneously immerse themselves in the new challenge of the PPP. We’ve all had to change our business process because of COVID-19, but the changes we have faced together often felt like drinking water from a firehose. Banks, small businesses, the federal and state government, regulatory agencies …all had to turn on a dime to meet the needs of their constituent communities and the economy.

IBANYS will continue to work hard in advocating and supporting our IBANYS member banks through this challenging time.


Many New York community bankers have begun reopening their lobbies and branches with safeguards in place to keep their staff and clients safe and healthy as we adjust to the “new normal”. . . Others are taking a more guarded approach, maintaining the operational practices and policies established when the pandemic hit. IBANYS will continue to gather and provide banks information on reopening 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 .
Build revenue-generating portfolios with BHG – Virtual Webinar July 22 nd  at 9 a.m.
IBANYS is excited to have Bankers Healthcare Group join us to discuss how they’re helping community banks build revenue-generating portfolios through medical and professional loans.
Since the COVID-19 outbreak, the lending market has seen a significant amount of disruption. At a time when banks would have been focused on loan volume and building their income streams, many shifted their attention to the Paycheck Protection Program (PPP) to support local business owners.
Albert Crawford, BHG’s Founding Partner and CEO will break down how banks are reaping the benefits of partnering with BHG to grow their loan portfolios with top-tier borrowers. Link to register:  https://calendly.com/bhgbanks/ibanys-bhg-webinar?month=2020-07
Eric Luse - 1952 - 2020

Luse Gorman, PC

June 29, 2020
It is with a collective heavy heart that we are writing to inform you of the passing of our partner and the founder of our firm, Eric Luse, after a ten-year battle with cancer. Over the course of his 40 plus years of legal practice, Eric was a tireless advocate for the community banking industry and a trusted advisor to management teams and boards of directors of community banks across the country. He will forever be associated in the mutual banking industry as the father and patron saint of the mutual holding company structure, which has enabled so many community banks to thrive and prosper. His attitude toward work and life in the face of his own personal health adversity could serve as a role model for all - he never dwelled on his own misfortune and continued to engage, lead and advise as always and with his usual tenacity and passion.

His dedication to the firm and the practice of law was second only to his dedication to his family. Eric is survived by his wife of 43 years, Susan, three children and three grandchildren. He loved his family deeply.

Eric’s greatest legacy will be the firm that he played such a critical role in shaping and developing during the past 27 years. Due to Eric’s vision and leadership, Luse Gorman is the premier community banking law firm in the country today, representing community banks and holding companies from Maine to Florida, east coast to west coast, Alaska and Hawaii and the Mid-West in between. We work with more than 350 financial institutions and their holding companies, public and private, mutual and stock, and no firm knows better than we do on a real-time basis the issues facing community banks. Eric’s guiding philosophy for our firm was for us to be not just a legal advisor to, but to become a strategic and valued partner with, our clients. We never will lose sight of the high standards Eric set for the firm – provide quality and timely service; understand the unique needs of each client; provide practical and understandable advice; and always place the interests of the client first. These standards have enabled our success and will continue to guide our performance in years to come. 
We thank Eric for his vision and service and we will forever miss him.

Luse Gorman, PC
There’s no doubt that 2019 looked very different than 2020, and community banking was no exception. But our top lenders’ exceptional performance last year has set them up for success even in a time of turmoil. See the most successful loan producers in the agriculture, commercial and consumer/mortgage categories.

IBANYS would like to congratulate Ballston Spa National Bank, Elmira Savings Bank, Rhinebeck Bank, Ponce Bank and Ulster Savings Bank on making the list.

cbsi Talking Business: Special Banking Edition: July 2, 2020
Dear cbsi friends:
As we celebrate Independence Day during this challenging time, we focus this special edition of #cbsiTalkingBusiness on the efforts of community bankers who help small business in their communities.
We were pleased to talk with two banking leaders Robert Fisher, CEO of upstate NY based Tioga State Bank who is the Chairman-Elect of the Independent Community Bankers of America and John Witkowski, the CEO of the Independent Bankers Association of New York. They describe the efforts of local bankers to help small business thru the Covid-19 period the Paycheck Protection Program loan processing and ongoing efforts leading to reopening.
We receive banking know how from Bruce Clapp president at Dayton, Ohio based MarketMatch.com and David Shipper, senior research analyst at Boston based Aite Group outlines his new research report.
Offering perspective on the recovery and trade, introducing the term "Reshoring" is Prof Victor Petenkemani, Associate Dean of the Mercy College NY School of Business.
Best wishes for a meaningful and safe 4th of July.
Kenneth G. Kraetzer
Vice President

"We are relationship focused, dedicated to customers in good times and bad"

That's Robert Fisher, the CEO of Ithaca, NY based Tioga State Bank, is Nat. Chair Elect of the Independent Community Bankers of America, a graduate of Notre Dame and a veteran of the US Air Force Topics of the discussion:

  1. Impact of Covid19, "Everything Shutdown" served customers via "Drive thru banking" with lobbies reopening in early June.
  2. Re Payroll Protection Plan made over 500 loans distributing $38.7 million, saved 6,000 jobs
  3. Required considerable manual processing, "We made it easy to get money to customers who needed it."
  4. Staying ahead on technology, digitizing checks was a major milestone.
  5. At ICBA work on Regulatory Relief proportional to our customer base.
  6. Supports Financial Literacy for high school students.

Reach Robert Fisher at Tiogabank.com more on ICBA at icba.org
" Small Business is what makes this world tick, they make communities thrive and do well".

That's John Witkowski, CEO President of the Independent Bankers Association of New York State describing the ways community bankers have helped small business during the Covid-19 Crisis. Key points:

  1. During Covid-19 crisis Community Banks have supported small businesses in their communities, both existing and new customers with Payment Protection Program Loan application processing during both rounds of the CARES Act.
  2. In NYS State 265,000 PPP loans completed for $40 billion
  3. The Independent Bankers of New York State serve banks with up to $12 billion in assets.
  4. Performs advocacy at state government to protect community banks from regulations intended for much larger banks.
  5. Becoming a cashless society, customers are using mobile wallets, banks need to meet customer expectations for technology
  6. Career transition: College football at Columbia to the NFL Lions and Oilers to banking.

Reach John Witkowski at 518-436-4646
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. 
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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
COCC Sends Special Rebate to Core Clients
In these extraordinary times, COCC is proud to announce we are sending service fee rebate checks totaling approximately $1.9 million to all of our clients to our show appreciation for their dedication and service to their communities. COCC’s Board of Directors approved this rebate at its monthly Board meeting in April 2020. This rebate, which will be distributed among COCC’s core clients, represents approximately 20% of COCC’s fiscal year-end earnings in 2020. Read full press realease below.

ICBA and The American College of Financial Services are offering a new  “20 in 2020” scholarship  for veterans and their families seeking careers as community bankers.
Recipients will receive full scholarships to complete coursework and earn The American College Wealth Management Certified Professional designation. The year-long coursework includes instruction in goal identification, risk management, and investment management plans. Applications are due July 31, and winners will be notified by Sept. 1. 
Ready to run
After a lag, prepayments are primed to take off.
By Jim Reber
If you are inclined to read bond analysts’ research reports, eventually you’ll chance upon some commentary that addresses the performance of mortgage securities. To many of the uninitiated, which I pointedly state do not include community bankers, mortgage-backed securities (MBS) are an abstract collection of investments that have long maturities and a volatile series of principal paydowns. They seem to require a lot of effort and are only marginally tethered to the housing finance market in general. Read full article below.

Albany Update
IBANYS Working With DFS On Mortgage Forbearance "FAQ" Document
IBANYS is working with the New York State Department of Financial Services (DFS) on our request that the Department develop and make available to community banks a DFS "FAQ" document on the mortgage forbearance issue. We expect the document to be finalized and released soon.
Legislature Still Not In Session -- But Might Return Week Of July 20
The New York State Legislature is not in session this week. T he Senate and Assembly are reportedly holding private party conferences today, and might reconvene in session the week of July 20. However, no agenda has yet been set.
DFS Wants State Banks To Minority & Women Owned Businesses
The  New York State Department of Financial Services (DFS) is urging the state's banks to assist minority- and women-owned businesses struggling to access credit during the coronavirus pandemic. DFS issued a letter Tuesday reminding lenders of amendments to the state's Community Reinvestment Act (CRA), under which banks are evaluated on how they meet the credit needs of businesses owned by women and minorities.  
Progressive Advocates Seek Budget Parity For Legislature
A coalition of government reform groups say the New York State Legislature should consider limiting some of Gov. Andrew Cuomo’s emergency powers gained during the pandemic and return, at least remotely, to meeting in session to set policy for the state. Republican legislative leaders and some liberal Democrats have also called for "reining in" some of the governor's powers. Governor Cuomo called the idea “stupid,” and noted that with the virus spiking alarmingly in other states, “there is no thinking American who does not believe that this is a state of emergency.” He could not give a date for when he thinks it’s appropriate that the emergency powers end, saying “when COVID ends, the emergency ends.”
Progressive Groups Want State To Create A Public Bank
Public Bank NYC, a coalition of over 30 advocacy groups, has for two years been urging the creation of a public bank system for local or state governments. Legislation introduced in the State Legislature in January would authorize local municipalities to lend money to public banks and authorize public ownership of stock in them. The bill, S5565A  and  A09665A , was introduced in January by State Senate Banks Committee Chairman James Sanders (D-Queens) and Assemblyman Ron Kim (D-Brooklyn) respectively and is in the Senate and Assembly Banks Committees for evaluation. The bill would update and authorize the state Department of Financial Services to issue special-purpose public bank charters to counties and regions across the city.

Governor Extends Some Executive Orders Through August 5
Governor Cuomo signed Executive Order No. 202.48, which "Continues Temporary Suspension And Modification Of Laws Relating To The Disaster Emergency." It extends, through August 5, a number of executive orders issued by the Governor March 7. However, it does not include any executive orders that have already been separately addressed and superseded by statute, such as the Mortgage Forbearance laws under Chapters 112 and 126 of the Laws of 2020.
Washington Update
PPP Extended To August 8; Community Banks Advocate Reforms In Next Relief Package
Congress passed legislation extending the PPP application deadline until August 8th. The SBA has approximately $130 billion in remaining PPP funds. ICBA and community banks continue advocating reforms to include in the next COVID-19 relief bill, including a more straightforward approach to PPP loan forgiveness as well as capital, accounting, and tax relief. Community bankers can continue using ICBA's  Be Heard grassroots action center  to provide Congress with the full slate of recommended reforms to include in the next relief bill.
CFPB's Final Rule On Small Dollar Lending
The Consumer Financial Protection Bureau  issued  a final rule on small-dollar lending that rescinds the mandatory underwriting provisions of the 2017 rule but keeps its payments provisions. The CFPB said there was insufficient legal and evidentiary bases for the 2017 rule’s mandatory underwriting provisions for determining borrowers' ability to repay small-dollar loans, including payday, auto-title, and balloon-payment loans. The agency is proceeding with provisions barring lenders from attempting to withdraw funds from an account in which two consecutive attempts have failed unless consumers consent to further withdrawals. In a  comment letter  last year on the CFPB's effort to revise the rule, ICBA called on the bureau to allow flexibility for banks to use their own reasonable underwriting guidelines and encouraged the agency to promote community banks as model small-dollar lenders.
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.
Fed's Quarles: Too-Big-To-Fail Efforts Paying Off
Resolution planning and capital reforms have helped to address the too-big-to-fail problem going into the COVID-19 pandemic, Fed Vice Chair for Supervision Randal Quarles  said . Speaking in Washington in his capacity as Financial Stability Board chair, Quarles said recovery and resolution planning have produced timely information that has helped banks and authorities understand the economic impact of the pandemic. He also said authorities need to continue responding to the increase in financial assets at nonbanks.
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
Bulletin | OCC 2020-69 July 6, 2020
On July 6, 2020, the Office of the Comptroller of the Currency (OCC), along with the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Farm Credit Administration, and the National Credit Union Administration (collectively, agencies), published in the Federal Register "Loans in Areas Having Special Flood Hazards; Interagency Questions and Answers Regarding Flood Insurance" for notice and comment. The agencies propose to revise, expand, and reorganize the Interagency Questions and Answers issued in 2009 and 2011. 1

The agencies invite comments on the proposed new and revised interagency questions and answers. Comments must be submitted on or before September 4, 2020.

The agencies plan to issue separately for notice and comment new proposed questions and answers relating to the private flood insurance rule. 2 In the interim, the agencies provided in a webinar dated June 18, 2019 , helpful information on the private flood insurance rule, which will be supplemented by the new proposed questions and answers.

Note for Community Banks
The proposed revisions to the interagency questions and answers would apply to all OCC-supervised banks. 3

To help lenders meet their responsibilities under federal flood insurance law and to increase public understanding of flood insurance regulations, the agencies are proposing new and revised guidance addressing the most frequently asked questions and answers on flood insurance. The document

  1. reorganizes the existing interagency questions and answers on flood insurance to provide a more logical flow of questions through the flood insurance process for lenders and policyholders.
  2. includes a table that sets forth the existing categories of questions and the corresponding reorganized categories.
  3. reflects proposed changes to the 2009 and 2011 interagency questions and answers.
  4. includes new questions and answers on the escrow and force placement requirements mandated by the Biggert-Waters Act of 2012 and the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA), as well as the exemption in the HFIAA for certain detached structures from the mandatory purchase of flood insurance requirement.
  5. reflects flood insurance issues that have been brought to the attention of the agencies, including issues raised through the review process directed by the Economic Growth and Regulatory Paperwork Reduction Act of 1996.

Further Information
Please contact Paul R. Reymann, Director for Consumer Compliance Policy, at (202) 649-5470.
Grovetta N. Gardineer
Senior Deputy Comptroller for Bank Supervision Policy

Related Link

1 OCC Bulletin 2009-26, "Flood Disaster Protection Act: Revised Interagency Questions and Answers Regarding Flood Insurance"; 74 Fed. Reg. 35914 (July 21, 2009); OCC Bulletin 2011-42, “Flood Disaster Protection Act: Interagency Questions and Answers Regarding Flood Insurance”; and 76 Fed. Reg. 64175 (October 17, 2011).

2 84 Fed. Reg. 4953 (February 20, 2019).

3 The term "banks" refers collectively to national banks, federal savings associations, and federal branches and agencies of foreign banking organizations.


Washington, D.C. (June 29, 2020)—Independent Community Bankers of America® (ICBA) President and CEO Rebeca Romero Rainey issued the following statement on today's Supreme Court decision not to review the National Credit Union Administration's field-of-membership rules.
"Today's Supreme Court decision not to review a National Credit Union Administration rule that could have a discriminatory impact on urban communities is another reminder that Washington and Americans nationwide need to 'Wake Up' to the realities of tax-exempt credit unions.
"While the courts have granted considerable rulemaking discretion to the NCUA under the 'Chevron doctrine,' the agency's flawed plan would allow taxpayer-subsidized credit unions to include wealthy suburbs of metropolitan areas in their fields of membership while cutting out their urban cores. Meanwhile, it would drastically enlarge credit unions’ geographic reach by defining entire states and major metro centers as rural districts.
"The NCUA has yet to address redlining concerns with its rule, which is just the latest example of the credit union industry's captive regulator bowing to the growth-obsessed financial firms it is charged with regulating at the expense of local communities.
"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 and how far credit unions have strayed from the original purpose underlying their tax exemption."