November 13, 2019

In This Issue: 
November 11- Veterans Day Honoring all who have served

Message From The President

By John Witkowski, President & CEO

This week, as we celebrated Veterans Day with friends and family, New York community bankers took a moment to reflect on the sacrifices made by so many to ensure that all Americans can enjoy freedoms that must never be taken for granted. Together, may we always honor their service, and remain forever grateful for their valor. Happy Veterans Day! 

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Is YOUR Bank Represented In The Decision-Making  
Process Of YOUR Association?

Many organizations claim to be "member driven," but at IBANYS, it's our way of life. Make sure your voice is heard as IBANYS formulates our government relations policies and positions, educational programs and efforts to increase our non-dues revenue sources. Sign up to serve -- or, designate a representative from your bank to serve -- on our Government Relations Committee, Compliance Peer Group, CFO/Senior Management Peer Group and Innovation Committee. E-mail or

Another Longtime New York Representative To Leave Congress --
State Faces Major Loss In Seniority

This week, veteran Republican Congressman Peter King (R-Nassau County, Long Island) announced he will not seek reelection in 2020. He serves on the House Financial Services and Homeland Security Committees. He becomes the third longtime member of the New York Congressional Delegation to announce plans to leave Congress, along with Democrats Nita Lowey (D-Westchester County) and Jose Serrano (D-Bronx). (Rep. King is a 14-term incumbent, Rep. Lowey the the 20th House Republican in the nation to announce retirement in advance of next year's election.) In addition, Rep. Chris Collins (R-Erie County) has resigned from Congress after pleading guilty to charges involving insider trading.  

Rep. Lowey is in her 18th term, Rep. King his 14th and Rep. Serrano his 8th. These departures mean that, regardless of the results of next November's election, New York will have at least four new members of our Congressional Delegation. This means IBANYS will again have work to do in January 2021 informing and educating new Representatives about community banking. While party control of most of these districts is not expected to change (although the King seat may be quite competitive), the loss of four senior Members of Congress with significant committee chairmanships, assignments and major influence is never a positive for their constituents or state. 

For an early updated look at the 2020 political outlook in New York's 27 House districts from City & State click here. . .or visit

As always, thanks for all you do for community banking in New York State.
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Meeting Agendas & Registration Information Coming Soon


Click here for IBANYS -  2020 Meeting Dates & Locations  (printable version)





Compliance Conference & Directors Conference


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

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Government Relations

The New York State Legislature will return to Albany in January for the 2020 session. 

Latest Bill Signing Update

So far this year, Governor Cuomo has signed 379 bills into law, while 507 still await his signature or veto. According to a spokesman, the Governor typically ends up with 500-to-600 bills. The Assembly or Senate technically decides when to send bills to the Governor, and they have long agreed to do so in batches. He faces a 10-day deadline to act on bills after they are passed by the legislature, but the clock doesn't officially start until they land on his desk. He may decide  whether to sign or veto bills sent to him before late December of each year. If he takes no action, those bills become law 10 days after they reach his desk (excluding Sunday). He also has the authority to use a  "pocket veto" of bills that arrive on his desk in the final ten days of the year. He then gets 30 days to act on such a bill, which dies if he doesn't take action.

Legislative Introduction

S6792, Salazar (Same as A 8686, Kim) would amend the state finance and financial services laws -- and, the New York state urban development corporation act -- in relation to establishing the empire state inclusive value ledger establishment and administration act. It would create a "universally trusted digital debit-credit ledger system" through which New York residents could accumulate and trade tax and other state remittance credits with businesses and one another for the products and services that make up the day-to- day business of life. The sponsors state that this would amount to a "complementary currency system that fills all the gaps left by dollar-scarcity in presently overlooked regions and sectors of New York and its economy."  IBANYS is reviewing the proposed legislation. The legislation, was referred to the Senate Rules and Assembly Banks Committee.

Vacancy In State Senate's 50th District In Central New York

State Sen. Bob Antonacci (R-Syracuse) won the election to the State Supreme Court's 5th Judicial District.  Antonacci had been elected to the State Senate only a year ago. Governor Cuomo indicated he would call a special election for the Senate seat sometime in 2020. The seat will also be up for grabs again in November 2020's general election.

Meanwhile, the Governor recently added several senior members to his staff: 
  • Kumiki Gibson as Counsel to the Governor
  • Elizabeth Garvey as Special Counsel and Senior Advisor
  • Jesse Campoamor as Deputy Secretary for Intergovernmental Affairs
  • Simonida Subotic as Deputy Secretary for Economic Development
The Governor's top aides continue to be Secretary to the Governor Melissa DeRosa and Chief of Staff Jill DesRosiers.

State DFS Looking Into Goldman Sachs' Apple Card 

Superintendent Lacewell

NYS Financial Services Superintendent Lacewell said DFS is  investigating claims that Goldman Sachs' Apple Card  discriminated against women when determining credit limits. Lacewell said companies that deploy biased algorithms - even unknowingly - are still responsible for potential discriminatory outcomes.  "Whether the intent is there or not, disparate impact is illegal. . . Algorithms don't get immunity from discrimination." Lacewell said consumers across all industries deserve transparency into the "black box" of algorithms. "Consumers are entitled to know how these decisions are being made that affect their daily lives. . . .Your credit rating agency sends you a letter and says why you've been denied credit. This should really be no different."

Bill Would Create State-Run Title Insurance Agency

State Sen. Brad Hoylman (D-Manhattan) is introducing a bill to establish a state-run title insurance agency he says will cut homebuyers' closing costs and "rein in" an unregulated industry. The bill would create a task force to "examine and make recommendations upon the establishment of a public title insurance carrier." Currently, Iowa is the only state with a state-owned-and-run title insurance company, established in the 1940s. The New York State Land Title Association said if the Iowa system was implemented in New York, it would lead to higher costs to consumers because of legal and other fees.

Comptroller's Update On Property Taxes

New Yorkers pay some of the highest property taxes in the country, and the highest as a percentage of home value. However, the last decade has led to a slower growth of tax levies statewide.  State Comptroller DiNapoli's office reported that the total amount of money raised in property taxes by local governments increased by 2.4 this year to a total of $36.6 billion.   T he majority (nearly $23 billion) was levied by school districts.   County governments collected $6 billion in property tax levies (about 16% of property taxes in the state).   Property taxes in the state are capped at the lower of either 2% or the rate of inflation. Local governments can vote to override the cap, which has been in place since 2012.   The report found that from 2017 to 2019, property tax levies grew the most in cities, 6.1%. In towns, the levies grew 4.4% and school district levies have grown 4%.  During that same time period, home values have grown the fastest in western New York and on Long Island.


IBANYS' Plan of Action for 2020

IBANYS is preparing for the 2020 state legislative session that begins in January, developing positions and policies and encouraging member banks to meet with their local legislators to continue informing them about community banks, our priorities and the vital role we play in New York State. Please email us your ideas, thoughts and comments on issues you want to see on the 2020 IBANYS legislative agenda.

Washington, D.C.WashingtonGR

OCC Names Greenfield Deputy Comptroller
The OCC  announced  Kevin Greenfield will become Deputy Comptroller for Operational Risk. He will oversee the development of policy and examination procedures addressing operational risk, bank information technology, cybersecurity, critical infrastructure resilience, payments systems, and corporate and risk governance.

FDIC's McWilliams: CRE Loan Performance Strong
FDIC   Chairman Jelena McWilliams   said that while banks hold record amounts of commercial real estate loans, CRE performance is strong. McWilliams said banks hold roughly $2.4 trillion in commercial real estate loans, surpassing the 2008 peak and accounting for more than 61% of outstanding CRE loans. The Chairman did  warn that CRE holds challenges for the banking industry, including potential boom-and-bust cycles and asset-liability mismatches: "This evolution provides opportunity, but it also brings uncertainty to the lending environment." 

CFPB Working To Meet mandates On Small Business Data Collecting
CFPB Director Kathy Kraninger said the Consumer Financial Protection Bureau is working to meet statutory mandates requiring small-business data collection without impeding access to credit. "We have heard feedback from various stakeholders and know that there is concern with the burden to small entities, possible curtailment of credit, and privacy considerations, as well as a general desire for consistency with current business practices," Kraninger said.

OCC's Different path On CRA, Camels Reforms
Comptroller of the Currency Joseph Otting said the OCC may move forward on rules reforming CRA separate from the Federal Reserve Board and the Federal Deposit Insurance Corp. Otting also indicated disagreement with the Fed and the FDIC on reforming the Camels rating system, saying he's not sure "that banks want the Camel ratings to change."
ICBA To Fed: Move Fast To Launch "Minimally Viable" FedNow System
In a   comment letter, ICBA applauded the Fed for deciding to develop the FedNow real-time gross settlement system, and urged the Fed to launch a minimally viable service as soon as possible (rather than waiting up to 10 years to introduce an optimal version) to maximize adoption among community banks.  ICBA said this would allow community banks to choose to use FedNow, The Clearing House's RTP network, or both real-time services-facilitating nationwide adoption of faster payments.

On The Congressional Calendar

Powell Testifies On Economy, Interest Rates, Challenges 

Photo from Federal Reserve Board website
Testifying before the Joint Economic Committee today, Federal Reserve Chairman Powell 
said the Fed is unlikely to adjust interest rates anytime soon provided that the economy remains on its present path. "We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market, and inflation near our symmetric 2% objective. . . Looking ahead, my colleagues and I see a sustained expansion of economic activity, a strong labor market, and inflation near our symmetric 2% objective as most likely. Powell said the labor market remains strong, incomes are rising and consumer confidence continues to grow, but cautioned that challenges remain, such as weakness abroad, trade tensions and low inflation. 
Powell is also scheduled to appear before the  House Budget Committee  tomorrow. 
  • A bill introduced in both the House and Senate would limit interest rates on consumer loans to 36%, a rate already locked in place for the military. The bill would effectively ban traditional payday loans, which may include interest rates over 300%. 
  • Ahead of a Nov. 21 deadline, House Appropriations Committee Chairwoman Nita Lowey (D-Westchester County) said Congress will pass a Continuing Resolution to fund the government through Dec. 20. 

Action Alerts:  actionalert

Tell Your Members Of Congress Congress: "Wake Up"
To Credit Union Reality
As part of ICBA's new "Wake Up" campaign, community banks can use ICBA's "Be Heard"  grassroots action center to tell Congress to "open their eyes" to the risks and taxpayer costs posed by credit unions.  The campaign  calls on policymakers and the public to "Wake Up" to the risky practices, costly tax subsidies, and irresponsibly lax oversight of the nation's credit unions. The new effort  is part of ICBA's (and IBANYS')  long-standing opposition to the credit union industry's unwarranted federal tax subsidy and mission creep. ICBA distributed to Congress its new "Do They Know They're Tax Exempt?" white paper on credit union mission creep. Read the White paper here.

Among the conclusions of the the white paper:
  • Do not primarily serve individuals of modest means 
  • Do not restrict their activities to the specific communities they are mandated to serve
  • Withhold 21 to 33 cents of every dollar in tax subsidies they receive (In 2018, that amounted to between $500 million and $900 million in taxpayer dollars not directed toward credit union members.)
IBANYS strongly supports ICBA's "Wake Up" campaign to "open the eyes" of policymakers about the many ways that tax-exempt credit unions have an unfair advantage, and are using it to take out their tax-paying community bank competition. IBANYS is also exploring ways to host sessions for state legislators to discuss these issues. 
Visit and click on the advocacy tab.  

Seek Equal Treatment For Community Banks On Military Bases 
IBANYS joins ICBA in asking IBANYS members to urge their local Members of Congress to advance legislation that will help community continue to serve military bases and rural communities. ICBA's "Be Heard" grassroots action center ( can provide important information to help you. 1)  Urge lawmakers   to include language in a defense bill to extend the same "rent-free" benefits  to on-base banks that are currently enjoyed by credit unions; 2)  Support legislation   that would exempt from taxable income interest on loans secured by agricultural real estate, and 3)  Thank members of the House   who voted to pass ICBA-advocated legislation to establish a cannabis-banking safe harbor.  A Conference Committee is currently working to reconcile a defense appropriations bill to support the provision to require the Department of Defense to treat banks and credit unions operating on military bases equally.  New Yorkers on the conference committee  include Senator Gillibrand and Reps. Delgado, Katko, Engel, Meeks, Nadler, Rose, Stefanik, Tonko, and Velazquez. 

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Industry Trends & UpdatesTrends

Rock (and Roll) Into A New Decade - -
A Look Into A Previous Era Can Help Today's Portfolio Managers

By Jim Reber
President & CEO, ICBA Securities

It was 20 years ago today.  More precisely, it was 20 years ago this year that community banks, and their investment portfolios in particular, were enduring a period of extremes. Many of the readers of this column were in charge of their bond portfolios then, and were, proverbially, "Riders on the Storm", which involved:
  • Inflation, which actually used to be a problem, was gaining traction. The year-over-year Consumer Price Index (CPI) was more than 3% and rising.
  • Since the economy was doing quite well, unemployment dropped from 4.7% in 1998 to 4.0% at the end of 1999, which was a 30-year low.
  • The Federal Open Market Committee, chaired at the time by Alan Greenspan, was busy stomping on the brakes. Overnight rates rose 250 basis points (2.5%) between 1998 and 2000, finishing at 6.5%. This remains by far the highest level we've seen since. The 10-year treasury note reached 6.79% in January 2000.
  • Bond portfolios' market values took a beating: The average community bank's bonds had more than a 3% loss in 1999, which is enormous on a historical standard.
In short, it appeared we were on "The Eve of Destruction." Read the full column

Latest On Small & Midsize Banks' "Headcounts" 

An "American Banker" article on November 6 noted small and midsize banks, "much like their larger competitors, are cutting jobs to address margin pressure and get ahead of a slowing economy." According to data compiled by the FDIC. Headcount at banks with $10 billion or less in assets fell by 2% in the first half of this year, with a net loss of 9,100 jobs, 



The Economy: By The Numbers
  • The Federal Reserve reported that consumer credit increased at a seasonally adjusted annual rate of 4.9% during the third quarter following a 2.8% gain in September. Revolving credit, which includes credit card spending, rose 2.2% during the quarter after a 1.2% decline in September. Non-revolving credit (e.g., auto and student loans) rose 5.9% and 4.2 % on a monthly basis.
  • The U.S. Labor Department reported that nonfarm productivity, which measures hourly output per worker, fell at a 0.3% annualized rate between July and September, the biggest decline in almost four years. 
  • The U.S. Labor Department also reported that the number of Americans filing applications for unemployment benefits fell more than expected last week. 
    Initial claims for state unemployment benefits decreased 8,000 to a seasonally adjusted 211,000 for the week ended Nov. 2.
  • White House National Economic Council Director Larry Kudlow is reportedly leading an effort considering whether the President should include a proposal to reduce the middle class tax rate to 15%. However, even if approved by the President it would appear unlikely it couldpass Congress before the 2020 election. 

Banking NewsBankingNews
Excelsior Growth Fund Can Help Your Small Business Customers

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IBANYS Spotlight Is On...

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Did You Know?

. . .That when a small group of local independent community bankers gathered to form the Independent Bankers Association of New York State (IBANYS) in 1974:
  • The Miami Dolphins were the Super Bowl Champions
  • The Oakland A's were World Series Champions (for the third straight year) 
  • The Boston Celtics were the NBA Champs
  • The Philadelphia Flyers won the NHL's Stanley Cup
  • Cannonade won the Kentuckty Derby
  • Oklahoma was the NCAA football champion
  • North Carolina State won the NCAA basketball championship
  • Chris Evert and Jimmy Connors won Wimbledon
  • And, Gary Player won the Masters Tournament?

Did you also know that: 

  • The Academy Award for Best Picture was won by "The Sting" and,
  • Billboard's Number One song was "The Way We Were" by Barbra Streisand?

. . .Now you know. 

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