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*** Legislative "Heads Up": Senate Bill 390
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SB390 authorizes a city, a county, a school district or an
 institution of higher education to deposit their funds in interest bearing accounts with a bank
or with the State Treasury Money Management Trust.
The Bill would require that entities choosing a bank prepare quarterly reports, submitted to the State, that would include:
Name of the bank holding the deposit;
Balance of the account;
Rate of return on the deposit;
Amount of interest earned
Entities utilizing the State Treasury Money Management Trust would not be subject to the reporting requirements.
Possible concerns about this Bill include:
Taking funds out of local economies;
Disclosure of proprietary bank information
If this Bill would impact your bank we suggest that you contact your State Senator and share your opinion.
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Deposit Insurance Calculations Under Community Bank Leverage Ratio
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As the agencies prepare to finalize the framework for the community bank leverage ratio, the FDIC has
issued a proposa
l for
 how it will assess banks for deposit insurance that elect to use the CBLR framework. Comments on the proposal are due in 60 days.
Under the proposal, CBLR banks would be assessed as small banks. They would have the option of using either CBLR tangible equity or tier 1 capital for their assessment base calculation, and using either the CBLR or the tier 1 leverage ratio that the FDIC uses to calculate an established small bank's assessment rate. The FDIC said that it will provide an assessment estimation tool on its website to help banks determine their deposit assessment amounts under the proposal.
Additionally, the proposal clarifies that a CBLR bank that meets the definition of a custodial bank would have no change to its custodial bank deduction or reporting items required to calculate the deduction. It also clarifies that the assessment regulations would continue to reference the prompt corrective action regulations for the definitions of capital categories used in the deposit insurance assessment system, with technical amendments to align with the community bank leverage ratio proposal.
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State Regulators Seek Public Comment on Model State Payments Law
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The Conference of State Supervisors (CSBS) announced last week
 that it is seeking public input on issues related to state money transmission and payments regulation as regulators begin work on model legislation to introduce in all 50 states.
The Request for Information (RFI) solicits comments about several areas of law and regulation, including money transmission activities and exemptions, personal vetting requirements for investors, state supervision, and coordination between states.
John Ryan, president and CEO of CSBS, said, "The states are coming together to modernize nonbank licensing and supervision. Working with stakeholders to develop a model law for money transmission has the potential to create a streamlined experience for companies operating regionally or nationally, with substantial savings to be had. "
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Challenge to Stop Opaque Federal Student Loan Practices, Introduce Responsible Caps to Prevent Federal Loan Debt Traps
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New survey shows majority "very concerned" about student debt, support greater federal loan disclosures and reasonable caps
Americans strongly believe student loans should carry clear,  personalized, plain-language disclosures about the loan's total costs, according to a poll of registered voters. These disclosures are not included on federal loans but are already provided by private student lenders. The poll also found nearly 85 percent support placing responsible caps on federal loans to offer access to a quality education without setting up a debt trap post-graduation.
"The federal government holds around $1.4 trillion in student loans, making the Department of Education the fifth largest bank in the country, and is currently seeing a double-digit delinquency and default rate," said Consumer Bankers Association President and CEO Richard Hunt. "The government absolutely has a role to play in helping low-to-moderate-income students achieve their higher education goals, but it must be done in a responsible manner which does not set up families for failure by offering virtually uncapped loans with little disclosures.
"It is past time for the U.S. government to end its opaque lending practices and stop the debt trap created by virtually unlimited federal lending."
Implementing these changes, advocated by CBA, would help lower student debt and college tuition rates, which the New York Federal Reserve found can increase as much as 63 cents for every dollar of available federal aid.
A majority of Americans are unaware the federal government holds more than 90 percent of student loan debt. And while 90 percent of those polled support personalized disclosures outlining a loan's APR and monthly payments - standard practice among private lenders - federal loans lack them.
These are among the findings from a survey conducted recently by CBA to assess American voters' knowledge, attitudes and beliefs regarding the continually ballooning federal student loan crisis.
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