September 11, 2019
Community Bank Services

Argent Money  


Bank Management and Directors Conference Nov. 5th
Embassy Suites  -  Little Rock
Come hear Coach Neighbors kick off a great one-day event Nov.5th!
Something for everyone!

HR and Medicinal Marijuana 
Washington D.C. Update
The Growing Landscape of Cybersecurity
Compliance and Financial Accounting Update  
 SBA Arkansas Bank Lender Awards!   
And More! 

Check out the Agenda and Register!

(6 Free CPE Credits!)

Assessment Credits Finally Paying Off 
The FDIC Deposit Insurance Fund (DIF) reserve ratio has reached 1.38 percent, triggering the distribution of approximately $764 million in assessment credits for community banks with assets under $10 billion. The FDIC will start applying those credits in September to offset the 2019 second-quarter bank assessments.
The FDIC was required to offset the cost of increasing the reserve ratio from 1.15 percent to 1.35 percent on institutions with assets of less than $10 billion by surcharging banks over $10 billion and providing assessment credits to banks under that size. Those surcharges ended and the assessments credits were awarded last year when the DIF reached a reserve ratio of 1.35 percent. Under the FDIC's final rule, the FDIC will automatically apply the credits to banks with assets less than $10 billion once the DIF reserve ratio reaches 1.38 percent, which the FDIC confirmed this week.
Banks under $10 billion are eligible for credits because of a 2016 FDIC rule implementing an ICBA-advocated provision in the Dodd-Frank Act of 2010. It's been years in the making, but the industry is finally reaping the benefits of that success.
This welcome bit of deposit-insurance news is due exclusively to ICBA, state association, and community bank grassroots outreach. We were the only ones who advocated the change as part of long-sought deposit-insurance reforms, and we did so with the long-term success of community banks in mind.
At the time of the original debate, the DIF was in negative territory amid the fallout of the Wall Street financial crisis. Looking at the big picture, ICBA and community banks fought hard to ensure Main Street institutions wouldn't be stuck footing the deposit-insurance bill for a crisis they didn't cause.
These DIF credits will be automatically applied each quarter that the reserve ratio is at least 1.35 percent, meaning that banks under $10 billion can continue counting on this meaningful cost savings as they serve local communities nationwide.

SBA - ACB Small Business Resource Center
Resources for community banks to maximize lending opportunities that generate and enhance the growth of small business

The SBA Arkansas District and ACB announce their joint sponsorship of the Small Business Resource Center.

In this site you will find many useful contacts, archived SBA training videos and information to help you and your small business borrowers navigate the journey of opening a small business or expanding current business operations. This is a great resource to learn more about SBA products and how to bring them to your bank to ensure that your local small businesses have the resources necessary to start, grow, and succeed.

Credit Union Consolidation Continues
Total assets in federally insured credit unions rose 6.3 percent over the past year to $1.52 trillion while their numbers declined to 5,308 from 5,480, the National Credit Union Administration reported.

According to second-quarter data, insured shares and deposits rose $62 billion, or 5.5 percent, while the average credit union outstanding loan balance rose 1.5 percent to $15,458.

The troubling trend of large credit unions buying up smaller community banks made headlines this week in The Wall Street Journal.
ICBA has led the way in raising the profile of this troubling trend with its Credit Union Task Force, Be Heard grassroots action alert to Congress, and email address, which community bankers can use to flag examples of egregious credit union actions.
NCUA Report  >> 

FASB Proposes Guidance to Ease Libor Transition
As banks work to reduce their dependence on the London Interbank Offered Rate, the Financial Accounting Standards Board proposed guidance that would help ease the potential effects of reference rate reform on financial reporting. The proposed guidance would offer optional expedients and exceptions for applying generally accepted accounting principles to contracts, hedging relationships and other transactions affected by reference rate reform, provided they meet certain criteria.
The guidance would apply only to contracts and hedging relationships that reference Libor or another reference rate expected to be discontinued. Comments on the proposal will be due Oct. 7.
The Proposal  >> 

CFPB to Host Symposium on September 19
The Consumer Financial Protection Bureau will hold a symposium  on behavioral law and economics on September 19 at 9 a.m. entitled Behavioral Economics and Consumer Financial Services Policy. The event will be webcast on the Bureau's website, where you may log in at 7:45 am CDT on the morning of the event.
The symposium is the second in a series announced earlier this year to explore consumer protections in today's dynamic financial services marketplace. The series is aimed at stimulating a proactive and transparent dialogue to assist the Bureau in its policy development process, including possible future rulemakings.
The event will feature remarks by Bureau Director Kathleen L. Kraninger and Deputy Director Brian Johnson.  The first panel will include a discussion of the methodological foundations of behavioral economics.  The second panel will be a discussion of behavioral law and economics and consumer financial protection. 
The Answer of the Week
QUESTION:   Are new disclosures required to be provided under the Military Lending Act for a renewal of a covered transaction?  
ANSWER:  The refinancing or renewal of consumer credit requires new disclosures only when the transaction for that credit would be considered a new transaction that requires disclosures under Regulation Z. 
Reference: 32 CFR 232.6(e).

  • Current market trends and how they affect your portfolio.
  • The importance of solid prepayment assumptions, especially now.
  • Negative convexity, is it really all that bad?
  • Where we see relative value in the mortgage market.
  • Resources available to help you manage current and prospective positions.
The webinar will last approximately 1 hour.