March 14, 2019

In This Issue: 
Message From the President

By John Witkowski, President & CEO

IBANYS' Regional Compliance Conferences: "A Big Hit!"

This week, IBANYS held our first two  Compliance Conference programs in Rochester and Troy, NY . Attendance  was high, with 75 attendees from nearly 35 community banks! We are excited to expand upon the success of these programs by providing a third conference in New York City on April 9, which we are looking forward to making an annual event. We are also extremely thankful to the speakers who helped make this program a winner.  Feedback from bankers at this week's conferences has been extremely positive: 
  • "Thank you very much. The content and provision of this program was both congruent and quite relevant."
  • "Well done!! A lot of good information to bring back to the bank.  Speakers were very knowledgeable."
  • "Great seminar this year! Very dynamic speakers. Great panel."
  • "Great mix between bank professionals and regulators."
Participants gained insight into relevant topics by experts in the industry. Regulators from the OCC, FDIC and NYS Department of Financial Services (DFS) were among several knowledgeable speakers who gave interesting and engaging presentations. Topics that were covered included  BSA/AML, CRA/Fair Lending, TRID trends, marijuana related businesses,  CDD/EDD Beneficial Ownership Programs,  Best Practices in Monitoring Programs & How to Report the Results and a panel discussion with regulators. Our attendees also had an opportunity to earn up to 7.5 CPE credits as well as network with fellow banking colleagues. 

Top Row From Left to Right: Nancy Lake of ACBB, Rochester Attendees, & Deborah Hermann of OCC
Bottom Row From Left to Right: Panel Discussion with Regulators, Terri Luttrell of Abrigo, & Panel of Regulators

Top Row From Left to Right: Brittany Washington of FDIC, Troy Attendees, & Yolanda Ford of NYS DFS
Bottom Row From Left to Right: Nancy Lake of ACBB, Panel Discussion with Regulators, & Stephen King of Wolf & Company, P.C.

This week was just the beginning of IBANYS' conference calendar. More exciting conferences await, including our Directors Conferences in April, Security and Lending Conferences in May, and our Annual Convention in June. Don't forget about our Banking Executive Symposium as well, which will be held in September. Full information for these various meetings are included in today's newsletter and can also be found on our website. Be sure to save the dates and submit your registrations ASAP to secure your place. 

Make your voice heard in Washington D.C. on April 29 - May 1 at ICBA's Capital Summit!
Community bankers from across the country will gather to express their priorities, concerns and ideas, as well as meet with various legislators. IBANYS will be participating in these "hill visits" with members of our New York Congressional Delegation, which are scheduled for Tuesday, April 30. New York has five members on the House Financial Services Committee and a number of representatives on other key committees. 

There are also excellent learning opportunities with  an assortment of speakers from Congress and federal agencies . Speakers will include U.S. Senate Banking Committee Chairman Mike Crapo (R-ID), who led the fight to pass S. 2155, the legislation that provided the first meaningful regulatory relief for community banks since the enactment of Dodd-Frank. The new Chairwoman of the FDIC, Jelena McWilliams, will also be speaking. In addition to prominent speakers, full legislative and regulatory briefings will be provided, along with a Monday night (April 29) IBANYS dinner co-hosted by the Association and preferred partner Luse Gorman, P.C.

With your help, we can present a strong, unified presence that community banking is essential to every community and our economy. IBANYS is putting a strong focus on our advocacy efforts, specifically in Washington as the legislative landscape continues to change. All voices matter. Register to attend with IBANYS today!


If there is someone at your bank who is not currently receiving the e-newsletter, send us their names and email addresses and we will add them to our list! Email  Linda Gregware or Natalie Rowan to add additional recipients or for more information. In addition, ensure everyone is following IBANYS on Facebook, Twitter, Instagram and LinkedIn to stay-up-to-date with all IBANYS news.

Follow IBANYS On Social Media!

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2019 Meetings

Get Ready For 2019 Annual Convention!Convention19




June 10-12, 2019


5218 Patrick Rd, Verona, NY 13478


Attend One of Our Educational Meetings! Meetings2019

Our 2019 Meeting dates and locations are now available! These educational conferences cover various subjects that are important within the community banking industry, spoken by the experts. T hey are also a great opportunity to network and earn CPE credits. Here is what we have planned for 2019:


April 2, 2019
145 Killbourn Road
Rochester, NY 14618

                           View Brochure                          View Registration Form

*This forum is limited to 15 participants

**This forum is for IBANYS member banks only

***This event is sold out



April 9, 2019
1185 Avenue of Americas, 38th Floor
New York, NY 10036

                            View Brochure                         View Registration Form

CPE Credits Available = 6

                           April 16, 2019                                     April 17, 2019
                    RIT Inn & Conference Center                    Hampton Inn Poughkeepsie
                       5257 W.  Henrietta Road                                   2361 South Rd.
                          Henrietta, NY 14467                            Poughkeepsie, NY 12601

                          View Brochure                          View Registration Form

CPE Credits Available = 7


                           May 7, 2019                                         May 8, 2019
                 RIT Inn & Conference Center                     Hampton Inn Poughkeepsie
                      5257 W. Henrietta Road                                   2361 South Rd.
                         Henrietta, NY 14467                              Poughkeepsie, NY 12601

CPE Credits Available  = 7



May 21-22, 2019
16 North Franklin Street
Watkins Glen, NY 14891

CPE Credits Available  = 7


Banking Executive SymposiumBankExecSymposium

September 9-11, 2019
200 Riverside Drive
Clayton, NY 13624

CPE Credits Available  = TBD


Have an idea for one of our meetings? Want to see a meeting or forum on a different subject? We want to hear from you! 
Contact Linda Gregware or John Witkowski with your thoughts and/or comments.

IBANYS Education/WebinarsWebinars

The 2019 Webinar is now available! The Independent Bankers Association of NYS (IBANYS) partners with CBWN to bring you more than 150 webinars each year covering compliance, lending, regulations, security, operations, new accounts, collections, fraud, security and other topics. Even better, each time you purchase a webinar, you support IBANYS, because a portion of your registration comes directly to us. Thank you!  

You can view the 2019 Webinar Schedule here or by category here. In addition, CBWN has made some recent updates to provide better service to its consumers. Unfortunately, some changes may have caused you to miss important webinar announcements. Please read the IBANYS letter to view the updates and ensure that you do not miss another webinar.


CBWN has added more than 140 webinars to the IBANYS webinar calendar, covering all the essential topics. Start the new year off right by gaining the knowledge and tools to make 2019 the best year yet! 

CBWN and IBANYS thank you for your continued support of the education in the community banking industry. 



2019 Webinar Series - Available Now

6 Webinars  for the Price of 5


10% off a 4-Part Series

Choose From The Following:

            Credit Analysis & Underwriting Series                        Regulation E-Series
                             4-Part Series                                                     6-Part Series 

                       ACH Specialist Series                            Mortgage Lending Hot Spots Series
                             6-Part Series                                                     6-Part Series

                     Board Reporting Series                                     Teller Training Series
                             4-Part Series                                                     6-Part Series

                               BSA Series                                                      C-Suite Series
                            4-Part Series                                                      4-Part Series

                          Call Report Series                                       Consumer Collection Series
                             4-Part Series                                                      4-Part Series

                               IRA Series
                             4-Part Series


Reg relief makes most reciprocal deposits nonbrokered, providing banks the opportunity to attract even more deposits. Thanks to the newly signed regulatory relief bill, most reciprocal deposits are no longer brokered. This comes as banks face intense and increasing competition for deposits.

Join Promontory Interfinancial Network - the nation's leading provider and inventor of reciprocal deposit placement services - for a free webinar that outlines key provisions of the new law and the impact ICS®, Insured Cash Sweep®, and CDARS® can have on banks' balance sheets. The webinar will also cover how banks can use ICS and CDARS to capitalize on the opportunities at hand; presenters will discuss cost-effective ways to use the services to attract high-value relationships (even as deposit competition intensifies) and to lock-in more low-cost funding (even as interest rates continue to rise). This webinar is a "must" for decision-makers at banks of all sizes, especially for community banks that utilize collateralized deposits and/or listing services.

Numerous new banks are joining the Promontory Network. In order to give these newly on-boarded banks an opportunity to begin transacting, we have decided to extend this incentive program through March 31, 2019. 

Choose a date and time that works for you!

Government Relations


Governor, Legislature At Odds Over Budget

From left to right: Andrew Stewart-Cousins, Governor Cuomo, & Carl Heastie

Gov. Cuomo has outlined his goals for the state budget through budget director Bob Mujica releasing a series of stipulations for the spending plan that include ending cash bail, funding for mass transit in New York City and a permanent cap on property tax increases. The Governor wants to avoid a midyear correction with the spending plan, which underscores his caution regarding spending on big-ticket items, including education. On Tuesday, the State Senate and Assembly  released their respective one-house budget proposals and expect to pass them later this week. Their proposals are statements of position, with no chance of becoming law, but indicate the positions of Assembly Speaker Heastie and Senate Majority Leader Stewart-Cousins as they begin to seriously negotiate the final details. Tensions are running especially high between the Governor and Senate Democrats. With just over two weeks left until the deadline for approving the budget, early signs indicate it may be a contentious process.  In their individual proposals:
  • The Assembly removed virtually all "non-fiscal" policy initiatives from its proposal, even those supported by the Democratic Majority Conference. Speaker Carl Heastie (D-Bronx) prefers to take all policy measures out of the budget, giving Democratic lawmakers a stronger position negotiating with the Governor. The Assembly proposal would add three additional income tax brackets above $5 million and create a new tax on second homes worth more than $5 million. 
  • The Senate Democrats kept in most of the policy initiatives, and the tone throughout the Senate's budget document expressed concern or skepticism regarding the Governor's proposals. It noted: "Failure to ensure reasonable limits on Executive authority would signal an irreversible abrogation of our constitutionally guaranteed legislative responsibility." State Senate Republicans criticized the proposed tax increases in the budget talks (e.g., discussions of raising revenue through on online sales tax, a property tax surcharge on second homes of the wealthy and congestion pricing.)

State Legislative Activity 
  • The Senate Banks Committee has reported S. 727, Montgomery would permit state and federal credit unions to participate in the State Business Development District Program. This legislation passed the Assembly in previous years, but never the Senate. Democrats now hold a significant majority in the Senate and a seven-to-four majority on the Senate Banks Committee.  The legislative agenda is different in 2018. Support for credit unions' involvement in municipal deposits business and related areas appears higher. There is no companion bill yet in the Assembly, this action does reflect potential movement on this issue. IBANYS will again submit our Memo in Opposition to S.727, based on the fact that credit unions pay no income taxes to NYS and should not receive the benefits funded by taxpayer dollars. 
  • S.1461 (Sanders) would allow credit unions to join the Excelsior Linked Deposit Program.IBANYS has opposed this bill in previous sessions and continues to oppose it this year, for reasons noted above on S.727. There is no Assembly companion bill as yet. 
  • S. 2106, Sanders to require banks to disclose negative consequences of establishing alternative payment schedule on a loan (e.g., due to renegotiation, default). For example, providing a disclosure that the transaction could have a negative consequence on their credit score. There is no companion bill in the Assembly. IBANYS will work with the legislature to seek modifications to the bill, such as restricting the application to consumer mortgages and consumer loans, not commercial loans, and perhaps inserting the disclosure as an add-on.
  • S.133 (Carlucci)/A.5635 (DenDekker), was proposed at the request of State Attorney General James. It would expand current data breach notification areas to include biometric data, credit and debit cards, and emails with passwords/security questions. It includes a limited exemption for banks who notify of breaches (under the federal Gramm-Leach-Bliley Act) to avoid duplicate obligations.
  • Legislation sponsored by Sen. Gaughran (D-L/I.) to update the state's "zombie property" law has passed the State Senate. The bill would reduce from two years to one the time a city, town or village must wait before beginning the process to take ownership of an abandoned property.  The Assembly companion bill is sponsored by Assemblyman John McDonald D-Capital District).
  • S.4182 (Salazar)/A.1800 (Magnarelli) would expand the current vacant and abandoned property requirements to include covering HOA/co-op fees. The legislation was on the floor in the Assembly this week, and on the Senate Housing Committee's agenda. 
  • A.5610 (Weinstein)/S.2396 (Hoylman) which would allow for an arbitration ruling to be vacated where an arbitrator disregards the law, passed the Assembly this week. It has not yet moved in the Senate.
  • S.2884A (Sanders)/A.2611A (Dinowitz), which would prohibit the disclosure or use of consumer credit history in hiring, employment and licensing determinations, with an exemption for those required to utilize the credit histories for "licensing or permitting purposes," was reported out of the Senate Consumer Protection Committee. It has not yet moved in the Assembly.

Marijuana Legalization Bill Coming Sooner Than Later?

The legalization of marijuana in New York can be accomplished within the coming weeks, according to Assemblywoman Crystal Peoples-Stokes (D-Buffalo, Assembly Majority Leader). Peoples-Stokes is the legislation's main sponsor in the Assembly. 

In a recent interview, she stated:  "It is complicated, but it is a complicated topic that's been out there for the last six years. Sometimes the longer you wait, it doesn't mean the problems go away. I think it's something that we should try and get done within the next couple of weeks. Governor Cuomo wants to have the issue dealt with in the state budget, which is due at the end of March. He has cautioned that if it doesn't pass, the measure would be "in trouble" of getting accomplished this year.

Comptroller DiNapoli: Foreclosures Down

State Comptroller DiNapoli reported annual foreclosure filings in New York have decreased by 46% between 2013 and 2018. The Comptroller called that a significant improvement, but cautioned: "...the foreclosure crisis is far from over. To extend the progress we've made, New York must continue to support the programs and reforms that have helped homeowners avoid foreclosure and communities reduce blight caused by zombie properties."   Among the comments included in the report:
  • Statewide, foreclosure filings fell by 46 percent between 2013 and 2018, from 46,696 to 25,334.
  • The number of pending cases in the court system has fallen by half since reaching a high of over 92,000 in 2014.
  • Changes to court system practices have improved efficiency, which has helped reduce the foreclosure caseload.
  • The foreclosure rate (pending mortgage foreclosure cases as a percentage of housing units) has fallen in every part of the State.
  • Relative to the rest of the State, foreclosure rates are highest in the Long Island and the Mid- Hudson regions.
  • Only four counties- Clinton, Putnam, Rockland, and Suffolk- have a foreclosure rate over 1 percent.
  • Other stakeholders are pursuing efforts to reduce harm to local governments and communities caused by vacant abandoned "zombie properties."

Have You Reached Out To Your New State 
Legislators  Members Of Congress?ReachOutCongressRep

There are 39 new members of the State Legislature and 5 new members of the new York Congressional Delegation. IBANYS has provided lists of all the new State Senators, Assembly Members and Congressional Representatives, as well as talking points to help them understand and appreciate the importance of community banks to New York's state and local economies and communities (see below) as part of our   outreach program to all member banks and encouraged you to meet with your new members of the State Senate, State Assembly and New York Congressional Delegation. The program materials include:
  •  Talking points for your use in your meetings, emails and phone calls to introduce yourselves and to help inform them about New York's community banks.
Please contact your new state and federal lawmakers, then let us know the results by emailing  John Witkowski and Steve Rice 

Washington, D.C.WashingtonGR

ICBA Unveils "Community Focus 2020: The Community Bank Agenda for Expanding Economic Opportunity" ICBACommFocus2020

ICBA unveiled its new legislative and regulatory policy platform: " Community Focus 2020: The Community Bank Agenda for Expanding Economic Opportunity". The multifaceted agenda advocates common-sense reforms that will promote greater access to financial services and economic opportunity throughout local communities nationwide.

Community Focus 2020 includes policy prescriptions on the following issues areas:
  • Regulatory Relief: ensuring common-sense reforms that tier regulations to community banks' scale and risk profile, including capital standards and the bank exam environment, to better promote the flow of credit and economic opportunity for all individuals and families. 
  • More Competitive Landscape: Promoting a fair playing field between current providers of financial services, such as community banks, and new entrants in the marketplace while scrutinizing the taxpayer-subsidized advantages enjoyed by tax-exempt credit unions and Farm Credit System lenders.
  • Community Bank Innovation: Promoting financial innovation and collaboration with fintech companies as well as regulations that foster a level playing field across the financial sector.
  • Bank Secrecy Act/Anti-Money Laundering: Addressing outdated BSA/AML rules to make them more efficient and effective by raising the currency transaction report and suspicious activity report thresholds and ensuring that beneficial ownership information is collected and verified by either the IRS or other appropriate federal or state entities at the time a legal entity is formed.
  • Data Security, Fraud and Privacy: Advancing proper security and confidentiality of customer information and supporting equally strong safeguards for the many other entities that use and store consumer financial data.
  • Preserving Mortgage Lending: Supporting access to an open and robust secondary mortgage market, including Fannie Mae and Freddie Mac, which are a source of capital for lenders of all sizes and are obligated to serve all markets at all times.
  • Tax Relief: Promoting tax and budget policies that foster economic growth and support the community banking sector by providing tax reforms and encouraging private savings and small business investment.
  • Industry Concentration and Systemic Risk: Advancing legislative and regulatory changes that would curb or end advantages enjoyed by too-big-to-fail banks while preserving the separation of banking and commerce to ensure unbiased credit decisions and avoid excessive market power.
  • Agriculture and Rural America: Advocating policies that will support rural America by strengthening community banks, which fund nearly 80 percent of all agricultural loans from the commercial bank sector.
  • Payments: Creating a legal and regulatory environment governing payments that does not discourage community banks from offering various payments services that best address consumer needs.
  • Cybersecurity: Supporting policies that broaden supervision of technology service providers while recognizing existing cybersecurity frameworks, tools, and assessments for community banks to avoid duplicative and counterproductive obligations.
ICBA President & CEO Rebeca Romero Rainey commented:  "ICBA's Community Focus 2020 agenda supports needed financial and regulatory reforms that policymakers on both sides of the aisle can advance."  ICBA and community bankers developed "Community Focus 2020" to advance a more efficient system of regulation, unbiased laws governing the financial sector, a safer and more secure business environment, and more effective agriculture policies to extend the nation's economic growth to every corner of the country. She noted the multipronged agenda advocates common-sense reforms that will extend the nation's economic growth to every corner of the country. "In short, Community Focus 2020 offers a comprehensive plan to help every American in every community-whether urban, suburban, or rural-join in the nation's economic prosperity,".  ICBA and community  bankers look forward to working with policymakers on advancing this agenda. View the policy platform .

ICBA Supports Safe Harbor Bill Regarding Banks 
& Cannabis-Related Businesses

ICBA expressed its support for newly reintroduced legislation ( the Secure and Fair Enforcement or "SAFE Banking Act" that would establish a safe harbor from federal sanctions for financial institutions and ancillary businesses that serve cannabis-related businesses in states where cannabis is legal.  In a letter to the bill's co-sponsors, ICBA noted: "While cannabis remains illegal at the federal level, an increased number of states have legalized it for medical and/or recreational use. As these businesses continue to mature they require access to the traditional banking system, the conflict between state and federal law has created increasingly significant legal and compliance concerns for banks that wish to provide banking services to CRBs in jurisdictions where it is currently legal. Legal and regulatory uncertainty has curtailed access to the traditional banking system for CRBs and forced them to operate mostly in cash. Cash-only businesses, especially those with a high volume of revenue, pose a significant risk to public safety.

ICBA does not advocate for legalization of cannabis at the federal level or otherwise, but we do support the creation of an effective safe harbor from federal sanctions for banks that choose to serve CRBs in states and jurisdictions where these businesses are legal. The SAFE Banking Act would create such a safe harbor by providing that in jurisdictions where cannabis is legal federal banking regulators may not threaten or limit a bank's deposit insurance, downgrade a loan, prohibit or discourage the provision of banking services, or take any other prejudicial action solely because a bank customer is a CRB. . ."

Fed's Brainard: CRA Regulations Should be Tailored Based On 
Bank's Size, Business Strategy

Lael Brainard
Federal Reserve Governor Lael Brainard stated this week that 
Community Reinvestment Act (CRA) regulations and evaluations should be tailored to banks based on their size and business strategy. Brainard said small banks could have their lending and retail services evaluated under the retail test, while larger banks could be evaluated under both the retail and community development tests. 

Federal r egulators are discussing CRA reform following the OCC's August 2018 advance notice of proposed rulemaking. Last November, ICBA wrote to the OCC and called on regulators to improve CRA consistency and transparency, and urged the FDIC and Fed to be part of future modernization efforts.

House Financial Services Chair Waters: Allow Regulators To Break Up Megabanks  For Repeated Consumer Violations

Maxine Waters
House Financial Services Chairwoman Maxine Waters (D-CA) plans to advance legislation allowing banking regulators to break up megabanks that exhibit a pattern of repeated consumer violations. Chair Waters is planning a Committee vote on the bill after the recent testimony by Wells Fargo CEO Tim Sloan, who was subjected to strong bipartisan criticism for the bank's actions "exploiting" customers. 

At that hearing, Chair Waters cited a    Wall Street Journal report that the OCC is considering forcing out top Wells Fargo executives or board members amid a series of scandals at the megabank, and she told Sloan that regulators should consider ousting him. The OCC issued a rare public rebuke to Wells Fargo, saying it continues to be "disappointed" with the bank's performance under its consent order, immediately after the Sloan testimony.

BSA/AML Reform In Congressional Focus

Members of Congress on both sides of the aisle have said the Bank Secrecy Act and anti-money-laundering (AML) regime needs to be updated and reformed.  At a House Financial Services   subcommittee hearing   on detecting and deterring financial crime, Representatives discussed legislative proposals to increase clarity on BSA guidance and require companies to disclose beneficial owners when they are formed. ICBA's  white paper  includes  principles for modernizing the BSA/AML regime - including government collection of beneficial ownership records when legal entities are formed. 

CFPB's Kraninger Testifies Before Key House & Senate Committees

Kathy Kraninger
Consumer Financial Protection Bureau (CFPB) Director Kathy Kraninger has testified for the first time before both the House Financial Services and the Senate Banking Committee. Director Kraninger said the CFPB is in the early stages of developing a rule to provide more guidance on unfair, deceptive or abusive acts or practices, or UDAAP. 

ICBA has long advocated greater clarity under UDAAP, including written guidance that provides clear examples of permitted and forbidden practices. Director Kraninger was questioned during her Senate hearing over the CFPB's decisions to overhaul the payday lending rule and to stop examining financial firms for compliance with the Military Lending Act. She was also pressed about the lack of action on student loan debt.

ICBA Sends Message To Hill During Credit Union Fly-In Visits

As thousands of credit union representatives were in Washington this week for meetings with policymakers, ICBA sent a message to congressional offices raising questions about that industry's tax exemption. 

ICBA noted credit unions have become virtually indistinguishable from tax-paying commercial banks, and also  provided topics to discuss   with credit union activists (e.g., the surge of credit union acquisitions of community banks and the dependence of the credit union model on its tax subsidy.)   Community bankers can voice their opposition to expanded credit union powers-while advocating regulatory relief and other issues-at next month's   ICBA Capital Summit   in Washington.

Meet With the New York Congressional Delegation at the
ICBA Capital SummitICBACapSummit

The 2019 ICBA Capital Summit will be held April 28 - May 1 in Washington. Community bankers from around the nation will travel to Washington to meet with their Members of Congress in their offices "on the hill" and hear federal financial regulators to discuss key issues. We'll hear firsthand from financial and policy leaders, and work to influence the policy-making process. New York community bankers: Mark your calendars and save the dates. U.S. Senate Banking Committee Chairman Mike Crapo, a champion of the S.2155 regulatory relief bill that provided the most comprehensive relief for community banks since Dodd-Frank's enactment in 2010, will be a featured speaker at the Capital Summit. as will the new FDIC Chair, Jelena McWilliams.

IBANYS will be scheduling meetings with members of the New York congressional delegation. With a Democratic House of Representatives, a new agenda in the House Financial Services Committee, five new Representatives from New York and six New Yorkers on the House Financial Services Committee, it is more important than ever to bring our New York community bankers' voices, priorities and stories to the forefront. Email John Witkowski or Steve Rice  to confirm your participation and indicate which Representatives with whom you would like us to arrange meetings with.  

Industry Trends & Updates

Cash Whiplash 
Changing Interest Rates Can Create Volatile Cash Flow ReberArticleCashWhiplash
By Jim Reber
President & CEO, ICBA Securities

Jim Reber
Before 2018 gets too much further into our rearview mirrors, it may be worthwhile to review what investment portfolio lessons we can derive for future reference. The popular notion among community bankers is that, for all the positives that the industry enjoyed last year (record earnings, continued loan growth, and solid credit metrics), the bond portfolio was a lagging performer. I believe most of that impression was the result of fixed-income investments being, for the most part, underwater.  It may therefore surprise you to learn that, in 2018:  
  • Tax-equivalent yields improved nicely to 2.78%, an increase of 32 basis points (0.32%); 
  • Average lives actually decreased from 4.4 years to 4.3 years; and 
  • Net unrealized losses did increase, but only by about 1 percent of face value.
That third bullet point may sound like fake news, alternative facts, or just old-fashioned spin, but the average net unrealized loss as of December 31 was still only about 1.5 percent. The average bank's bond portfolio was further underwater than that for most of the year and was down around 3.0 percent as late as November. Read the full article.

oversight while violating the longstanding U.S. separation of banking and commerce activities." To access the full white paper, visit, then click on "Industrial Loan Companies: Closing the Loophole to Avert Consumer and Systemic Harm."


New ICBA White Paper On ILCs

Rebeca Romero-Rainey
I CBA's new white paper on industrial loan companies (ILCs) examines the long history of this obscure charter type and its transformation in recent years.  In her ""Main Street Matters" blog, ICBA President and CEO Rebeca Romero Rainey  wrote that the ILC has morphed into the fashionable charter of choice for financial firms seeking to benefit from the federal safety net, while avoiding legal restrictions and company oversight under the Bank Holding Company Act. 

She observed:  "Not only does this create an unlevel playing field relative to community banks and other financial institutions that must meet holding company standards, but it also leaves a dangerous gap in safety and soundness oversight while violating the longstanding U.S. separation of banking and commerce activities." 


Deadline for Independent Banker's "40 Under 40: Emerging Community Bank Leaders" Extended!FortyUnder40Extension

By popular request, the deadline has been extended until Friday, March 15 for sending your entry for Independent Banker's "40 Under 40: Emerging Community Bank Leaders" awards.
 Don't miss out on your chance to recognize community banking's rising stars!

As a reminder, we'll be judging candidates using the following criteria:
  • Their vision of and for community banking
  • Their leadership style
  • Their innovative approach to a project or initiative they spearheaded
  • How they give back through community work and/or advocacy
Questions? Contact:

Chris Lorence: Group Executive Vice President - Member Engagement & Strategy and Chief Marketing Officer, ICBA

Phone: (202) 821-4320

You can nominate as many people as you like.  
Remember: nominations are due by Friday, March 15. The panel of judges will then select the "40 Under 40" - who will be featured in Independent Banker's June issue.  Thank you for your participation.


Economic Updates
  • According to the U.S. Labor Department, the economy added just 20,000 jobs in February, while the unemployment rate declined to 3.8 percent. That marked the lowest growth rate since September of 2017, but followed an upwardly revised gain of 311,000 jobs in January. 
  • The  Federal Reserve reported that consumer credit increased at a seasonally adjusted annual rate of 5.1 percent in January. Revolving credit, which includes credit card spending, rose 2.9 percent. Non-revolving credit, such as auto and student loans, increased 5.9 percent.
  • According to the Mortgage Bankers Association's seasonally adjusted index, total mortgage application volume rose 2.3 percent last week from the previous week. Volume was essentially flat compared with the same week one year ago; mortgage interest rates are decidedly lower than a year ago. Home shoppers are buying, but most appear to be wealthier consumers buying more expensive homes. Applications to refinance a home loan decreased 0.2 percent for the week and were 4.4 percent lower than a year ago.
  • According to the U.S. Commerce Department, new homes sold at a seasonally adjusted annual rate of 607,000 in January, down from 652,000 in December.  The partial government shutdown and volatile stock market reportedly hurt sales, despite lower mortgage rates. Purchases of homes yet to be constructed declined. Sales of homes already under construction increased. New-home sales in January ran slightly below the totals for 2018 and 2017.

Vining Sparks & ICBA Securities Balance Sheet AcademyBalanceSheetAcademy

Registration is now open for Vining Sparks and ICBA Securities' Balance Sheet Academy seminar in Memphis, Tennessee from Monday, April 29 to Tuesday, April 30 2019. This  advanced seminar is designed to expose seasoned community bank portfolio and balance sheet managers to advanced products and concepts.  The objective 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 wide range of topics.  Balance Sheet Academy  provides discussion and practical classroom exercises 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.  
Attendees will learn how the changing economic data impacts market interest rates from Vining Sparks' Chief Economist. The Balance Sheet Academy is structured for more experienced investment managers, 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. 

Contact:  Kert Johnson,  SVP/Marketing at (901) 762-5340 or


CEIS' President and CEO, Joseph Hill, shares his thoughts
Indicators available to CEIS show that credit quality is generally sound, in planning for 2019 we see issues from our perspective that are potential concerns. Specific areas of concern based on our reviews are - a modest but gradual rise in criticized and classified assets, general loosening in underwriting standards for many loan types as evidenced in the increased level of policy waivers, the level of interest only transactions on stabilized properties, increased covenant compliance violation rates, and an observed complacency in managing portfolio risk and its potential direction. These observations and others may show an accumulated risk in portfolios that contain a notable level of borrowers that are not yet tested in adverse scenarios beyond the statistical models. Read the full newsletter.

Stay up to date with all CEIS Review news by visiting or visiting the Associate Member News page on our website. 


Hybrid Asset Based Lending: Controls Are Necessary CEISHybridAsset
Senior Consultant With CEIS Review, Inc. 

John has over 35 years' experience in the commercial banking industry and is an experienced manager and senior credit officer.

As an independent loan review provider to approximately 150 foreign and domestic lending institutions, CEIS Review has the benefit of being able to gain insights towards the emerging and prevalent developments within the banking arena regarding commercial lending activities. One such is the entrance or expanded interest of some banks to engage in hybrid asset-based lending operations with varying levels of success and effectiveness. While portfolio and income fee diversification is important, the increased activity should be fully vetted before the additional risk is added to the portfolio.  

Hybrid asset-based loans involve a unique credit structure designed to solve certain specific credit needs of customers by combining cash flow and asset-based lending in one credit facility. While the portion of the loan approved on a cash flow coverage basis is often managed with financial covenants, the asset-based loan portion is supported by collateral coverage that is monitored with a monthly borrowing base. Read the full article.

Banking News

Congratulations to Community Bank, N.A.!CongratsCommBank

In a study  by Forbes, Community Bank System, Inc. was ranked third in the nation for financial performance - making it one of America's Best Banks! The Forbes study analyzed growth, asset quality, capital adequacy and profitability - a ll metrics related to being a good bank. IBANYS send our congratulations to President & CEO Mark Tryniski and his entire team! Read more about the accomplishment.


Further Your Education at Barret Graduate School of Banking BarretGradSchool

Barret and IBANYS are aligned with a common interest: to represent the interests of the industry through effective advocacy and high quality educational offerings.

Located in Memphis, TN, Barret Graduate School of Banking offers a comprehensive graduate learning program for professionals in the financial services field. IBANYS has established partnerships with key industry educators including the Barret Graduate School of Banking. The school provides community bankers with an opportunity for a graduate degree in banking. 

We are currently endorsed by ICBA, ICBA Securities, Arkansas Community Bankers, CBAofGA, Indiana Bankers Association, CBAofKS, MIBA, CBAofOH, CBAofWV - with a couple more on the way. 

To learn more about Barret Graduate School of Banking, please visit


Keep The Door Open For Your Small Business Customers

Excelsior Growth Fund (EGF) is NYBDC's nonprofit Community Development Financial Institution and IBANYS' exclusive online lending partner. Join the growing number of banks that work with EGF to offer their customers an affordable and responsible option when they do not qualify for traditional financing. EGF offers loans up to $500,000 with a convenient, digital process. Loans under $100,000 are disbursed within 5 business days.

 EGF's experienced team can work hand-in-hand with yours to develop a customized process to make referring seamless. To learn more about offering your customers a second look through EGF contact Bryan Doxford, SVP, at at at (212) 430-4512. 

Spotlight Bank of the WeekSpotlightBank

If your financial institution is called a "savings bank," it has probably seen its fair share of history. The very notion of a savings bank is a relic from a time when banks were limited to one or two services. Although these regulations were repealed in the mid-1900s and banks could expand the services offered, many savings banks retained their original names in the interest of the community they served. Watertown Savings Bank is one such institution, where community has mattered for 125 years.

Watertown Savings Bank - 1893
In 1893, a small group of Watertown residents decided they would build a financial institution to benefit the community. This group, composed of prominent businessman and successful professionals in the area, was beginning to see Watertown flourish and recognized the need for a reliable local bank.

The bank was, and still is, structured as a mutual savings bank with a board of trustees and no stockholders. A brief look at the original list of trustees provides a snapshot of local commerce and politics around the turn of the century. Among the list are two paper manufacturers, a produce dealer, a former lieutenant governor, a city mayor and a local jeweler. The snapshot is
Watertown Savings Bank - 1921
brought more into focus with a look at the original operating hours. In addition to weekday hours, the bank was also open from 5:00 to 8:00 P.M. on Saturdays. This was done to accommodate the mill workers and factory employees, who could only make it to the bank on Saturday  
evenings after a six-day workweek.

The formative years of Watertown Savings Bank were proving fruitful, so much so that the bank moved into a new space in 1921. The new location, four times the size of the original office, was located at the top of Public Square and provided a hub for the hard-working local customer base. At this time, after only 28 years of operation, the bank had seen a growth of over $4 million in assets. Profits only increased in the decades to follow.

In 1959, the bank was once again in need of a larger facility and purchased two
Watertown Savings Bank - 1960
properties to facilitate the construction of a new office building. The new office opened a year later with 30 employees and $32 million in assets. A handful of our current employees started out at this now razed building, and they stayed because the bank cares as much about its employees as it does its customers.

Quality customer service is at the heart of what Watertown Savings Bank stands for and it is the reason customers continue to visit our branches. Bank President & CEO Mark R. Lavarnway said, "we have found that providing the highest level of personalized and community support offers many benefits which are often superior to our competitors. We understand our local economy and the diverse banking needs of our community."

This year, Watertown Savings Bank celebrates 125 years of service in the North Country. With 125 employees, $660 million in assets and a total of nine branches in
Watertown Savings Bank - 2018
Jefferson County, the bank built to serve the Watertown community is still thriving. It currently retains the largest deposit market share in the county and has been recognized as the top mortgage and commercial lender. The Bank's accomplishments do not stop at the county level either. It has been awarded the Top SBA Small Community Lender six times. Last year, Banking New York magazine named Watertown Savings Bank as the Top Community Supporter in New York State. In 2017 alone, we proudly donated over $335,000 to local non-profits and charitable organizations.

Our name and our mission have stayed the same since 1893. The nature of the banking industry demands that a bank evolve and adapt to stay relevant, but this is no small feat. Evolve too much and you risk losing your loyal customers, fail to adapt and you lose your ability to form new customer relationships. Watertown Savings Bank has found the right balance. Mr. Lavarnway points out "We have evolved with the times in terms of products and services, but we have maintained that same culture of local management, local decisions, and local support." An emphasis on local support is the reason we opened our doors 125 years ago and it is the reason they are still open today.

To learn more about Watertown Savings Bank and its products and services, please visit


About Spotlight Bank of the Week

Spotlight Bank of the Week is a new feature that we have added to our website and e-newsletter. It is an opportunity to promote anything about your organization, such as fun facts, organization news, special events, etc. The Spotlight Bank of the Week will be featured on our homepage slider, e-newsletter, and our social media platforms for one week. So don't miss out on this exceptional opportunity to showcase your bank to thousands of people!

View banks that have been featured as our Spotlight in the past!

To apply, just fill out our registration form and email it to Natalie Rowan at

IBANYS Spotlight Is On...

Westover Strategy is a consulting firm that works with companies in a variety of industries, including banking, on confidential strategy consulting engagements that are customized to fit clients' needs and priorities. E ven successful companies benefit from stepping back and taking a longer-term perspective on factors such as emerging competitors, new technology, evolving customer expectations, and their impact on the business model, organization and board of directors. 

Using a team-based approach, Westover will meet to review the goals, challenges, threats and opportunities your company is facing.  Offerings include Strategy Maps, Strategic Planning, Board Performance Enhancement and Strategy Execution. Susan Powell Byrd is the primary consultant and works with senior staff, board members and others as needed, to customize the approach so that it reflects the issues, needs and resources of your particular business.Westover offers a range of services, from basic assessments to full-fledged, deep dive strategic plans and board performance enhancement. Depending on the breadth of the service, other resources can be brought into engagements, tapping into a wide network of seasoned professionals. 

For additional information, c ontact Susan Powell Byrd: 

Phone: (585) 330-5694
*Website includes case studies and testimonials

IBANYS Endorsed Services
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

My Wellness Resource & TELADOC

The health and wellness landscape continues to evolve. "My Wellness Resource" can be a nice addition to your existing benefit package. 

Teladoc can save your banks time and money, and provide real value to your employees as this testimonial from a New York community bank CEO proves:
"I wanted to let you know that some of our employees and I have been using "Teladoc" and it is one of the best things we have done for the bank. We all love it: We are saving time, avoiding waiting in an urgent care center or a doctor's waiting room for non-emergency related illnesses . . .and it is easy to use and convenient. Once you use it, you are hooked! This was a great find! Would recommend it to all banks."

Mario Martinez 
Chairman & CEO
Catskill Hudson Bank

Contact Alan Justin: (716) 907-5500. 

"Cure the Blue" Helps Banking Industry Battle Prostate Cancer!

The "Cure the Blue" program sponsored by the Buffalo Bills Alumni Foundation allows New Yorkers to participate in one of the most comprehensive efforts to help promote prostate cancer awareness and research in the United States.  Lake Shore Savings Bank has provided prostate cancer literature and Cure the Blue information at all eleven of its branches and their headquarters in Dunkirk. The bank also offered Cure the Blue ceramic lapel ribbon pins for a $5.00 donations to Cure the Blue to all their customers. "We fully understand the severity of this disease and the devastating effect it can have on families" said Lake Shore Savings Bank President and CEO Dan Reininga. "Our support of the Buffalo Bills Alumni Foundation's "Cure the Blue" initiative is something that we are taking very seriously and are proud to support." Buffalo Bills Wall of Famer and Alumni Foundation President Booker Edgerson, a two time prostate cancer survivor, said the bank has been a tremendous longtime supporter, noting: "They have really stepped up to the plate with their unwavering support of our Cure the Blue initiative." 

IBANYS urges all of our member banks, associate members and allies to join the effort. Cure the Blue" raises funds and awareness regarding prostate cancer in New York State. Visit  to get involved! Of all new cancer cases in the nation, prostate cancer represents 9.6%. In 2017, there were an estimated 161,000 new cases, and more than 26,000 fatalities due to the disease. Support IBANYS' "Cure the Blue" campaign to help New Yorkers participate to promote prostate cancer awareness and research.

Secure, Enhanced Internet Presence

The .bank program by fTLD operates trusted, verified, more secure, easily-identifiable internet locations for financial companies and  customers. 

Did You Know?

. . .That New York State has produced two Chairmen of the U.S. Senate Banking Committee? Senator Robert Wagner (D-NY) chaired the Committee from 1936-47, and Senator Alfonse D'Amato (R-NY) was chairman from 1995-99. Meanwhile, five New Yorkers have Chaired the House Financial Services Committee (previously called the Banking Committee): Representatives Theodore Pomeroy (R) from 1865-69; Samuel Cox (D), 1875-77; Henry Bacon (D), 1891-93; Edward Vreeland (R), 1909-11 and Edmund Platt (R) from 1919-20. 

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

John J. Witkowski
President & Chief Executive Officer

Stephen W. Rice
Director of Government Relations & Communications

Linda Gregware
Director of Administration & Membership Services

William Y. Crowell III
Legislative Counsel

Natalie Rowan
Marketing & Social Media Assistant