April 29, 2020
IBANYS Weekly E-Newsletter
  • Visit our website at www.ibanys.net to review all our daily updates on COVID-19 beginning on March 16.
  • All in person IBANYS meetings including the annual convention have been postponed.
  • However, our webinars are still being offered; many address COVID-19 information for community banks. See information below regarding webinar offerings.
IBANYS wants to ensure we have the correct contact information on file for all community banks. We need your help and ask that you please complete the attached fillable form and return it to Linda Gregware lindag@ibanys.net. Thank you. Bank update request

The President's Message:
IBANYS News and Updates
By John Witkowski, President & CEO

As we head into the third month of this coronavirus (COVID-19) pandemic, we are feeling enormous impact not only on our public health (with, tragically, nearly 60,000 dead in New York State) but on our local, state and national economies as well. This morning, we learned the U.S. Economy shrunk 4.8 percent in first quarter of 2020 -- the biggest quarterly drop in over a decade (during the "great recession"). The slowdown is widely expected to worsen in the coming weeks and months. In New York State, there have been a record number of unemployment filings, and the state budget now will need to see significant cuts due to a lack of tax collections (the deadline was moved to July 15) and a lack of federal assistance in the federal relief packages to date.

IBANYS has been very actively engaged on behalf of New York community banks as Phase Two of the SBA's Paycheck Protection Program (PPP) launched this week. We have worked with the White House, Treasury, the SBA, OCC and several different congressional offices, among others.
  • While there were still glitches in the SBA system that delayed the process, nationally by Tuesday afternoon community banks under $10 billion in assets had neared the $30 billion in PPP funds set aside for them according to the Small Business Administration. These institutions made 331,119 approved loans worth nearly $30 billion, and will continue to be able to submit loans to be funded by the $250 billion in general funds authorized for the second phase of the PPP.
  • Lenders with between $10 billion and $50 billion in assets have been approved for nearly 84,000 loans worth more than $10 billion. The law allocated $30 billion of the overall $310 billion for these institutions.
  • Overall, the SBA has approved more than 475,000 loans worth more than $52 billion from more than 5,100 lenders. The average loan size under phase two is $111,000, down from $207,000 in the first round, and about 85 percent of the loans have been worth $150,000 or less..

New York State is taking early steps toward a hoped for May 15 partial reopening of the economy on a regional basis, with certain industries (e.g.,construction and manufacturing) first up. Governor Cuomo announced the state is creating a "NY Forward Reopening Advisory Board" with 100 business, community, and civic leaders to help guide the state's reopening strategy.

Today, Federal Reserve Chairman Powell today said it is not clear how long the economic stress will continue. He said second quarter economic data will be “worse” than anything previously seen, and that it is hard to predict when a recovery might begin given uncertainties surrounding the virus. Following its two-day policy meeting, the Fed pledged to use its "full range of tools" to insulate the economy, and would keep interest rates near zero until a recovery was well underway. 

Things change on a daily basis. Watch for our daily updates, and check our website for previous updates. Since March 16, IBANYS has sent out daily (and often, more than once daily) updates to New York community banks with important developments and information on the impact that the pandemic is having on New York community banks. If you have missed any of these communications, or would like to refer back to them, each is included on our website. Click the link: https://ibanys.net/covid-19/

During these challenging times, IBANYS is also working hard to bring you suggestions on other revenue and income generating programs, products and services. We have sent out information on some, and in today's newsletter (see below) we also discuss options we hope you will take the time to consider.

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NOTE:
All IBANYS meetings through July 1, 2020 have been POSTPONED.

I dentifying Alternative Program & Revenue Opportunities

Over the coming days and weeks, IBANYS will be working to provide a look at some alternative revenue generating and educational opportunities for community banks. We will be sharing information soon on a number of ideas and concepts we are currently discussing.
Executive Management Discussion Group
To: All NYS Community Banks:

First, we hope everyone is safe and healthy.

Secondly, all the community banks have done an amazing job in getting thru the SBA PPP obstacles and should be very proud of your support of small business customers and more importantly your communities. 

As we get into phase 1 of opening the economy across the country, there is a need to bring NYS State community banks together to discuss pressing issues and the future of our industry.

You are invited to attend our Executive Management Discussion Group, hosted in partnership with Karl Nelson, Founder & CEO of KPN Consulting. This one-hour meetingscheduled for May 7 at 10:30 a.m. will be delivered via Zoom Video Conferencing. See the attahed registration form for complete details and to register.

IBANYS welcomes our newest Associate Members.

Acxell - Compliance, Consulting, Internal Audit
Catalyzer, Inc. - Succession Planning, Performance Reviews
DataSure24 - Cybersecurity Services
Finastra - Banking Software, Internet Banking Products & Mortgage Products
GRC Solutions - Compliance Training
Premier Brokerage Services, Inc. - Broker/Dealer, Insurance Services

Click on the company to learn more about their services and how they can help you and your bank.
IBANYS Preferred Partners & Associate Members
Additional COVID-19 Resources
COCC COVID-19 Response
Throughout the COVID-19 crisis, COCC has been actively engaged with our clients to provide innovative solutions to the issues they face during the pandemic. COCC has remained focused on service and support providing our clients in many ways including:

  •  A free and integrated PPP web app/loan workflow
  •  Procedural enhancements specific to COVID-19
  • System support and guidance for loan deferrals and payment modifications
  • Remote access
  • Call center support
  • Customer messaging and digital campaigns
  • Proactive advice regarding security/fraud
  • Continuous education and training

This represents a sampling of the ways we have worked with our clients to help them better serve their communities. As the COVID-19 pandemic develops, we continue to undertake new initiatives to improve the operations of our clients.
 
For your convenience, we have launched a webpage to provide an overview of our response to the COVID-19 pandemic. As new developments arise, we will continue to update our COVID-19 Response page  here. If you have any further questions please contact  keith.arsenault@cocc.com .
COVID-19 Response Center

Freed Maxick, a Preferred Partner of IBANYS has a COVID-19 Response Center for banks and has provided for the following link for resources that banks may utilize during the pandemic.

Effective Communication - a new course in GRC Solutions Complimentary Working From Home Training

The last thing any of us want in self-isolation is to feel even more isolated because of poor communication.

We all expect to be working from home for a while, so it's important that we get it right.

To help with this we are continuing our series of complimentary online working from home training modules. Click here to learn more and to register
Our bank leaders are faced with the immense task of planning for and managing safe branch lobby and office re-openings, all while pondering what the future may hold for branch banking after the pandemic. La Macchia Group has prepared 2 resources to help with both near and long-term decisions, giving you immediate ideas and solutions to consider in a succinct and visual  Branch Re-Opening Guide  and suggestions for strategic positioning and operational adaptations backed by consumer research in their  Thriving After COVID-19 Whitepaper
On April 23, 2020, the Paycheck Protection Program and Health Care Enhancement Act (the "PPP Enhancement Act") was signed into law, which provides $310 billion in additional funding to the U.S. Small Business Administration’s ("SBA") Paycheck Protection Program (the "PPP") previously established by the CARES Act. As a result, the SBA has resumed processing PPP loan applications as of yesterday.

Our Alert provides an update on the PPP based upon the PPP Enhancement Act and the latest rules and guidance issued by the U.S. Department of the Treasury ("Treasury") and the SBA, including the SBA’s fourth interim final rule released on April 23, 2020 and Treasury’s Frequently Asked Questions Memorandum for the PPP, updated as of April 26, 2020.

Our Alert is available  here .
COVID-19 Free Marketing Resources

We have crafted several informational blogs for you to be able to share with your members to navigate these unfamiliar times. Find information regarding relief programs to help account holders, how to support small businesses through this time, and what account holders want to hear most right now.  More to come here, so keep checking in with us.  


With limited time and resources to dedicate to crafting communications, our team has compiled an array of digital assets. These include sample social post copy, downloadable images to utilize on various social media platforms or on your website, and helpful tips and resource links. The  Resource Center  is designed to help take one thing off their plate and aid financial institutions in communicating with account holders during this time. Share the  Resource Center w ith your members today for access to free downloadable assets!

Risk Rating Loans for Borrowers Impacted by COVID-19
In their Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus issued on March 22, 2020, the regulatory agencies made it clear they “…will not automatically adversely risk rate credits that are affected by COVID-19, including those considered TDRs.” Adverse risk ratings are Special Mention, Substandard, Doubtful, and Loss.  Consequently, just because you modified a loan for a borrower impacted by COVID-19, does not mean you have to rate those loans Special Mention or worse.
 
Albany Update

Economic Situation Will Mean Major Budget Cuts -- Tax Hikes Remain Unlikely
  • Gov. Cuomo plans to cut aid to localities by $8.2 billion and cut state agency budgets by 10% unless new federal aid comes through in the coming weeks, according to his updated state financial plan released last weekend. Public schools, health care and other state aid for localities will bear the brunt of the fiscal damage. State Budget Director Mujica said the state will know “exactly what the revenues are” on May 1. The new financial plan states that tax receipts have fallen by 12.4% in the past two months, and that unemployment in New York is expected to exceed 11%. According to a state-commissioned report, it will take years for the state to recover from a projected $243 billion in damage. It projects the state economy would recover to the “Pre-COVID” level in early 2023. The Legislature will have 10 days to respond to the specific cuts the administration will announce. The state Senate and Assembly could meet either in Albany, or remotely, in the upcoming weeks.
  • The Governor plans to balance the state’s books by cutting spending rather than increasing taxes. Some legislators still support proposals to raise taxes on the wealthy. Assembly Speaker Heastie is generally supportive of raising taxes, while Senate Majority Leader Stewart-Cousins has generally been more in agreement with the Governor’s position.

Weber Named General Counsel At State DFS
Superintendent Linda Lacewell announced Richard Weber has been appointed General Counsel of the New York State Department of Financial Services (DFS). He most recently was head of Financial Crime Prevention for the Americas at UBS, leading all areas of AML, BSA and Sanctions compliance for the division. He previously was head of Anti-Financial Crime for the Americas at Deutsche Bank, where he oversaw all financial and internal fraud investigations, analytics and financial intelligence in the Americas. Mr. Weber also served as Chief of the Criminal Investigation Division at the Internal Revenue Service of the United States Department of the Treasury, managing complex investigations of financial crimes involving money laundering, tax, sanctions evasion, cyber, cryptocurrency, bribery/foreign corruption, fraud and terrorist financing. 
Washington Update

Senate Plans To Return To Washington May 4 -- But Not The House
The Senate plans to return to Washington May 4 following an extended recess break due to the coronavirus, but the House -- after first planning to also return then -- has decided NOT to return due to members' safety concerns. Senate operations will be different from before. Senate Majority Leader McConnell said the Senate will "modify" its routines and "take whatever safeguards the Capitol physician" recommends.

What's Next? Phase Four
Negotiations will be getting underway -- likely between May 15 - June 1 -- on "Phase Four" of the recovery and relief package. Major issues such as federal aid to state and local governments, infrastructure spending, and a number of measures to address the magnitude of loss caused by the pandemic will be debated.

Senator Gillibrand Promotes Her Postal Banking Act As Way To Save U.S. Postal Services
In an op-ed in the New York Times, Senator Kirsten Gillibrand (D-NY) offered her solutions to strengthen the U.S. Postal Services -- and a key component of her proposal is her proposed Postal Banking Act, which would "leverage the Postal Service's 30,000 -plus locations to create access to a nonprofit bank in every community in the country, which would offer low-cost banking services to underserved populations."
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