IBANYS Weekly E-Newsletter
- Visit our website at www.ibanys.net to review all our daily updates on COVID-19 beginning on March 16.
The President's Message:
IBANYS News and Updates
By John Witkowski, President & CEO
The banking industry continues to operate in one of the most challenging environments in recent memory, and in perhaps unprecedented conditions and circumstances.
According to the latest FDIC Quarterly Banking Profile, community banks nationally reported quarterly net income of $4.8 billion in the first quarter -- which is a 20.9% decrease from a year ago.
- Despite weakening economic conditions, community bank net operating revenue rose, and loan growth held steady at 5.8% year-over-year.
- However, provision expenses grew to $1.8 billion—three times the amount reported in first quarter 2019 and, the decline in average yield on earning assets surpassed the decline in average funding costs, reducing average net interest margins by 12 basis points to 3.55%.
- Overall, the banking industry reported a 69.6% decline in net income from a year ago, as deteriorating economic activity increased provision expenses and goodwill impairment charges. The average return-on-assets ratio fell from 1.35% to 0.38% over the past year.
- The number of banks on the “Problem Bank List” rose from 51 to 54, which remained near historic lows. The Deposit Insurance Fund balance rose $2.9 billion from the previous quarter, though the reserve ratio declined 2 basis points due to the growth in estimated insured deposits.
Throughout these difficult times community banks have shown the way in serving local customers and communities in this time of crisis.
Indeed, recent PPP summaries show that banks with assets of under $10 billion have made 65% of all PPP approved loans, representing 63% of total loan dollars.
As New York State's regions move through the various phases of reopening their local economies, community banks continue to play a vital role protecting and assisting their local small businesses, helping their home mortgage borrowers make it through.
Community bankers are now considering their next steps: Deciding when and how to reopen lobbies and branches, how working remotely has impacted their operations, how to reassure employees and customers their safety remains paramount, and much more.
There will be a number of different options to consider, and IBANYS is reaching out to provide banks with ideas and alternatives for their review. Stay tuned!
Meanwhile, today's newsletter includes information on products, services and various revenue opportunities. Please contact IBANYS if you have any specific questions about the companies in the newsletter.
. . . . .
SBA Regional Director Steve Bulger and Deputy District Director/Upstate New York
will participate in
omorrow's "IBANYS Executive Group Discussion" that will feature a dialogue and q. and a.
There will also be open discussion of current issues and developments.
If you are not registered and would like to participate, please email John Witkowski or Linda Gregware
or complete the registration form and email to email@example.com.
registration form 6-11-2020
ALERT: Banks & Unemployment Accounts:
TO NYS Community Banks:
This is just to alert you on unemployment fraud that has been taking place in other states. Below are a few examples of what banks in other states are facing from criminals. Please read thru the samples and pass them on to your team so the bank does not get hurt by these fraudsters.
Here are the notes the bankers sent me:
We had an issue as well. Our customer received a large deposit from the "State of Arizona" and they were coming to take it all out to send a wire. Luckily our CSR questioned as to where the funds were coming from as it was unusual for this customer to have that amount of money. He stated he was just helping out his "girlfriend" and that he just needed to get this money to her for her to come move here with him. He'd never met the girl; she found him online - total scam. We returned the money, but it came in ACH to his account. I would think our customer would have been on the short end of the deal. With it coming ACH, I would not think the bank would be held liable because if it comes to a legitimate account, we are not required to verify the names against each deposit (only if we are made aware of a name not matching the deposit).
(At the end of the day though, if the account number matches, the receiving bank is allowed to complete the transaction even if the name is not matched to any name on the account.)
We are now doing some review of ACH deposits to see if this is happening more than we think.
We’ve had a handful of customers receive these deposits over the last few weeks. We’ve been able to return without loss to the customer or the bank.
Fraudsters were using the names of bank employees including the CEO to file for fraudulent unemployment claims.
One of our banks has been finding numerous fraudulent unemployment ACH payments being deposited to someone’s account that was previously opened legally. One of their customers received multiple ACH deposits for several different names and then moved the majority of the money out of the bank. The bank has contacted law enforcement but has not received any support. They are concerned with the bank’s liability and just assume that when this all comes out in the wash, the bank will be held liable.
This is just to make you are aware of what is happening to community banks across the country. I don’t have any answers other than to make you aware of the issues I have heard.
If any of you have had issues and would like to share, please email me at
Barret School Of Banking Offers New "Crisis Leadership" Program
In light of the growing pandemic in the spring, the Barret Board canceled the May 2020 Graduate School, and instead created a new "Crisis Leadership" program" as a way for to serve the industry during this time of need.
- If your bank has a current Grad student or alum, you can have access to the Crisis Leadership program for just $95/bank– as long as your bank is a member of the Alumni Roundtable: https://barret.ws/mainstreet/roundtable/
- If your bank does not have a current student or alum, your bank can have total access for $595/bank (if IBANYS member), or $895/bank (not an IBANYS member).
Here is a link that can give your more info on the program:
1). Total Hours: 25 (self-paced, recorded content)
- The expectation is it may take a few weeks to complete (depending on your schedules)
- A certificate will be awarded once all courses are complete
2). Proposed Launch Date: End of June
3). Learning Platform: Recorded Webinars
4). Facilitators/Course Topics:
- Trish Springfield/Energize2Grow - Building a Leadership Culture
- Brad Federman/PerformancePointLLC - Emotional Intelligence/Resilience
- Jim Reber/ICBA Securities & Marty Mosby/Vining Sparks- Balance Sheet/ALM Management Strategies
- Lee Anne Fryland/South State Bank - Leading Your Team
- Jimmy Sawyers/Sawyers & Jacobs - Tech Strategies/Working Remotely
- Ben Pankonin/Social Assurance - Messaging/Telling the Bank & Community Story
- Chip Higgins/Bizzics - Messaging/Personal Branding Strategies
There are also relevant podcasts, reference material, and links to pertinent information included in the overall program. For additional information, contact Chris Kelley, President/Executive Director, Barret School of Banking: 901-321-4000 (office); 901-270-3303 (cell);
Members of the public who plan to attend the meeting via webinar or require assistance should contact the OCC by 5:00 p.m. EDT on Monday, June 22, 2020, to inform the OCC of their desire to attend the meeting and to obtain information about participating in the webinar. Members of the public can contact the OCC by emailing
or by calling (202) 649-5420. Attendees should provide their full name, email address, and organization, if any. Members of the public who are hearing impaired should call (202) 649-5597 (TTY) by 5:00 p.m. EDT Monday, June 22, 2020, to make necessary arrangements.
Are you participating in IBANYS webinars? Now is the time! IBANYS webinars provide timely, important information on subjects of interest to New York community bankers including human resources, business development, investment, compliance and security and much more. They are valuable not only for their content, but for their convenience and low-cost. Take part from the comfort and privacy of your office, without leaving the bank.
The More You Buy, The More You Save
How does it work:
okens can be used to purchase live or recorded webinars anytime,
with no expiration
! Tokens for both live and recorded webinars are available for an additional fee. (What’s the difference?
Click here for the full description.)
Once you have your Subscription Token code, you can immediately register for webinars by using the code at checkout! (Subscription tokens not applicable for full series registrations, or other specials.)
Other Revenue & Income Generating Programs
Products and Services
offers high level disinfection services, specializing in end-use fogging application on various types of surfaces for advanced decontamination. Our services ensure thorough disinfection for both high-contact and low-contact areas, effectively prevents recontamination, and sets to improve the quality of life for employees, patients, and the general population.
100% non-hazardous solution. EPA Approved.
Kills 100% of pathogens & microorganisms including, but not limited to... COVID-19, H1N1, SARS.
Works on ALL surfaces including flooring, window treatments, fabrics, carpets, furniture, wood, metal, plastic, etc....
Once applied, the solution takes just 10 minutes to dry. Room is then able to be re-occupied. It would be 100% to go in immediately after. The 10 minutes is drying time.
Here are just a few of the other clients we are working with.
- Wegman's - All stores on a weekly basis
- Phillips Lytle - All offices (Buffalo, Rochester, Albany, and NYC)
- Niagara Wheatfield Central School District - Daily disinfect of over 600,000 sf
- Ted's Hot Dogs - All WNY stores
- Buffalo Medical Group
SALES EXECUTIVE - PURIFY GLOBAL
IBANYS Preferred Partners & Associate Members &
Additional COVID-19 Resources
Exiting a relatively benign economic environment many Bankers are now grappling with the task of reserving their portfolios', but with a plethora of variables regarding the COVID-19 Pandemic this article outlines options Bankers should consider when adjusting their reserves to ward against future losses.
Bank Stock Perfomance and M & A Update
The market crash in March 2020 brought an end to the longest U.S. expansion ever recorded. The Dow, S&P and NASDAQ plummeted35%, 31% and 24%, respectively, from year-end highs to levels not seen since 2016. After massive fiscal and monetary stimulus, lockdowns ending and promising treatments for coronavirus and hopes for a vaccine, markets have improved. The Dow, S&P and NASDAQ have increased 16%, 18% and 23%, respectively, from the end of March to May31.
On June 11, 2020, the U.S. Small Business Administration ("SBA") issued an interim final rule (the "Interim Final Rule") implementing the changes made to the SBA’s Paycheck Protection Program (the "PPP") by the Paycheck Protection Program Flexibility Act of 2020 (the "PPP Flexibility Act"). The PPP Flexibility Act changed many aspects of the PPP; most significantly extending the covered period for loan forgiveness purposes, lowering the amount required to be spent on payroll costs, extending the loan maturity period and revising the loan deferral period.
Our Alert summarizes key provisions of the Interim
Final Rule and is available
IBANYS Comments On Mortgage Forbearance Chapter Amendment On Governor's Desk;
NYS Legislature Likely To Reconvene In July To Address Budget Shortfall, Other Issues
The Chapter Amendment legislation on residential mortgage forbearance, passed in late May, is targeted only at state chartered banks. (Federally chartered banks are not impacted.) Mortgages currently receiving forbearance under the Governor's Executive Order 202.9, at the time of such forbearance, shall be considered as part of the requirement to provide forbearance under the new statute. At the end of the 180 days of forbearance provided, the borrower has an option to extend the forbearance for a second 180 day period if still in financial distress, as provided in the Chapter Amendment.
IBANYS opposed the original legislation passed by both chambers, and issued a Memo in Opposition. However, we continued to work with the Legislature, Governor's Office and NYS Department of Financial Services throughout the process that eventually resulted in the Chapter Amendment, which is an improvement over the original bill.
- If a bank determines that it unable to offer a mortgagor relief based on concerns regarding sufficient capital and liquidity, it must notify DFS within 5 business days of making the determination. The bank must also notify the mortgagor, who may file a complaint with DFS.
- The Chapter Amendment also clarified that forbearance applies to "monthly payments" due on the mortgage. It also allows interest, although it prohibits charging additional interest or any late fees or penalties on the forborne payment.
The Legislature stands in recess after having held two recent virtual sessions
-- one on COVID-19-related legislation and the second on policing reforms.
It appears likely the Legislature may reconvene in July
-- probably after there is more clarity on whether the federal government will provide financial assistance to state and local governments. The state faces a major budget shortfall, and decisions will need to be made as to how to address it. Spending cuts and perhaps some targeted tax increase have been discussed.
There has also been discussion concerning possible additional banking legislation
(that would also only impact state-chartered institutions) -- for example, one proposal would call for a 90-day forbearance period for commercial mortgages. IBANYS is closely monitoring the current legislative environment and other potential bills in the pipeline. We will keep you fully informed going forward.
Change In Leadership In State Senate GOP
New York State
Senate Minority Leader John Flanagan (R-L.I.) will retire from the Senate June 28
to enter the private sector. He had previously announced he would seek re-election this year. Flanagan was elected to the Assembly in 1987 at age 25, and then to the State Senate in 2002. He served as Senate Majority leader from 2015-18, when the GOP conference lost the majority.
Two Western New York GOP senators appear to be the favorites to succeed Flanagan as Senate GOP Minority Leader:
Sen. Pat Gallivan
(who represents parts of Erie, Livingston, Monroe and Wyoming Counties)
and Sen. Rob Ortt
(who represents parts of Monroe, Niagara and Orleans Counties). Three of the past four Republican leaders have been from Long Island, but recent Democratic gains in the downstate suburbs resulted in the balance of power within the Senate GOP conference shifting to upstate.
The last GOP Senate Leader from Western New York was Earl , who was majority Leader from 1966-72.
IBANYS was contacted by the New York State Department of Financial Services yesterday, and informed that
DFS is coming out with guidance for credit rating bureaus later in the day.
The Department wanted to remind banks to review the guidelines for use of emergency codes during the Covid 19 pandemic.
The guidance will be on the DFS website:
Treasury Announces Amended "EZ" PPP Loan Forgiveness Application Form
Today, the U.S. Small Business Administration (SBA), in consultation with the Department of the Treasury, posted
a revised, borrower-friendly Paycheck Protection Program (PPP) loan forgiveness application implementing the PPP Flexibility Act of 2020,
signed into law by President Trump June 5, 2020.
In addition to revising the full forgiveness application, SBA also published a new EZ version of the forgiveness application
that applies to borrowers that:
- Are self-employed and have no employees; OR
- Did not reduce the salaries or wages of their employees by more than 25%, and did not reduce the number or hours of their employees; OR
- Experienced reductions in business activity as a result of health directives related to COVID-19, and did not reduce the salaries or wages of their employees by more than 25%.
The EZ application requires fewer calculations and less documentation
for eligible borrowers.
Details regarding the applicability of these provisions are available in the instructions to the new EZ application form. Both applications give borrowers the option of using the original 8-week covered period (if their loan was made before June 5, 2020) or an extended 24-week covered period. These changes will result in a more efficient process and make it easier for businesses to realize full forgiveness of their PPP loan.
Please see the links provided below.
ICBA: Expand Transparency of Credit Union Acquisitions of Community Banks
The Independent Community Bankers of America (ICBA) called on the National Credit Union Administration to expand on its proposed rule to provide more transparency and disclosures when large, tax-exempt credit unions acquire smaller, tax-paying community banks. "The growing trend of large credit unions using their taxpayer-funded subsidies to acquire smaller, tax-paying community banks worsens banking industry consolidation, reduces the tax base of local communities, and furthers the credit union industry's encroachment into full-service banking without paying their fair share of taxes," ICBA President and CEO Rebeca Romero Rainey said today. "While ICBA welcomes the NCUA’s efforts to bring much-needed attention to this trend, more is needed to increase the transparency of these deals."
Among its recommendations, ICBA called on the NCUA to:
- Recognize that growth-oriented credit unions are targeting healthy community banks.
- Require credit unions to provide additional disclosures and member communications.
- Assess the impact of these acquisitions on acquired banks' local communities.
- Verify whether acquired bank customers are eligible to be members of acquiring credit unions.
recent Medium op-ed
from ICBA Vice Chairman Brad Bolton encouraging small credit unions to support congressional oversight of NCUA regulations benefitting the largest and riskiest credit unions. "While Main Street lenders have been helping their communities through the coronavirus pandemic, the federal credit union regulator has used the crisis to benefit the largest credit unions — at the expense of community banks and small credit unions alike," he wrote.
ICBA will continue calling on policymakers and the public to
and open their eyes to the risky practices, costly tax subsidies, and irresponsibly lax oversight of the nation’s credit unions.
ICBA Urges Community Banks To Comment On Two Proposed Credit Union Rules
Through Its "Be Heard" Grassroots Action Center
ICBA is urging community banks to submit comments to the NCUA on two recent proposed rules:
- Subordinated debt. The NCUA has proposed to allow large credit unions to issue subordinated debt, which would fuel rapid growth and consolidation in an industry that is already growing too quickly. View ICBA's sample comment letter.
- Credit union-bank acquisitions. The NCUA has proposed a new rule on credit union acquisitions of other financial institutions. As you know, these acquisitions have become more frequent and are rapidly transforming the financial services market. They threaten to undermine the tax base in your states, which, following the economic shutdown, are more desperate than ever for revenues. The NCUA proposal would create more transparency and is a step in the right direction. Our objection is that it does not go far enough. We must not miss an opportunity to meaningfully regulate and curb acquisitions which abuse the credit union tax subsidy. View ICBA's sample comment letter.
The action center provides suggested language, but community banks are urged to customize your comments for greater impact. It is critical that community banks make a strong grassroots showing, in quantity and quality of letters, to influence the rules and set down a marker against further credit union powers expansion.