SUMMARY Of IBANYS Government Relations Call Of March 24, 2017

March 24, 2017

IBANYS' Government Relations Committee met by conference call this morning. We heard an update from legislative counsel Bill crowell, who reviewed and discusses the status of several provisions within the Governor's proposed 2017-18 budget legislation that could impact New York community banks. We also had an update on federal matters from Alan Keller of ICBA.

I. Federal Update

ICBA's Alan Keller updated the Committee on recent developments on federal maters. He discussed the status of House Financial Services Chairman Hensarling's "CHOICE Act 2.0", the updated version of his alternative to Dodd-Frank that he initially released last fall. The updated version will likely be introduced in April, and marked up either later that month or in may.It will be an "aggressive regulatory relief" initiative. The overall bill will likely also be divided into a number of separate individual bills, and the legislative approach will go forward on both tracks to attempt to facilitate passage.  First, thoigh, the issue of flood insurance reauthorization will be addressed. That expires September 30. 

Alan also reported on the importance of the April 30-May 3 ICBA Capital Summit. he said Chairman hensarling will be speaking, and tha Vice President Pence and Senate Banking Chairman Crapo have also been invited. There will be the opportunity to meet on the hill with members of Congress. IBANYS will be participating, has a delegation ready to meet with New York Representatives, and is currently scheduling meetings with iNew York members of Financial Services, local Representatives and Senators Schumer and Gillibrand.

II. State Update

IBANYS Legislative Counsel Bill Crowell discussed the items in the proposed state budget impacting community banks, and reported on the status of each with just eight days until the April 1 deadline to enact the budget. 
The following details the status of these items.

Ted Article VII S. 2008B A. 3008 B
Part X

DFS Superintendent authorized to:
  1. a)  bring an action against an unlicensed entity or individual as if they were licensed and as such subject to penalties as licensee
  2. b)  Initiation and prosecution of civil actions against a regulated entity rather than Attorney General
    (The Assembly rejects; The  Senate rejects)
Part Z
DFS to license and regulate student loan industry 
(The Assembly accepts; The  Senate rejects)

Part AA
Protecting vulnerable adults from financial exploitation, banks permitted to place a hold on transaction where reasonable basis to suspect financial exploitation
(The Assembly rejects;  The Senate rejects, but places their own version in ELFA article VII part RR) -- The GR Committee stated it had no objection, provided that it is voluntary and not mandatory

Part BB
Ban involvement of bad actors in financial services based upon Superintendent determination of disqualifying event (The  Assembly rejects; The  Senate rejects). 
The GR Committee approved IBANYS' memo in Opposition (see attached HERE)

Part CC
Lending circle exemption from licensing by DFS
LEGAL\29783619\1 (The  Assembly rejects; The  Senate rejects)

Part EE
Licensing required for online lender (The Assembly rejected; The  Senate rejected)
There is a possibility that although the Legislature does not support the Governor's approach on this, they may well follow-up with stand alone legislation in the future. IBANYS has consulted with NYBDC on this. The GR Committee's position is that regulation is justified for these entities.

Part FF
Reverse mortgages subject to enhanced mortgage procedures (The Assembly accepts;The   Senate rejects)

Part GG
Assessments by DFS broadens applicability (The Assembly accepts with language changes; The Senate rejects). The administration says this would target such entities as the Bitcoins and debt/judgement collectors. The CGR ommittee believes there should be specific language detailing who would pay what.

Revenue Article VII S. 2009 B
Part U
Financial institution date match available when past due liabilities become fixed and final (The Assembly accepts; The  Senate rejects)

Part C
PPGG Article VII S. 2005 B A. 3005 B
A. 3009 B
Increased criminal penalties computer tampering and identity theft (The Assembly rejects; The  Senate accepts) 

On other matters, the Senate has passed IBANYS' proposed bill that would waive a CRA examination by DFS for institutions that have received a "satisfactory" or better rating from its primary federal regulator. The Assembly has not yet addressed this.

IBANYS will be holding future G.R. Committee meetings as the congressional and legislative sessions unfold. All meetings will be held Friday mornings at 9:00 a.m. unless otherwise noted. We will send out notices of when meetings will be held as situations dictate. Thanks to all for their participation and support.

Stephen W. Rice
Director of Government Relations & Communications
Independent Bankers Association of New York State