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Richard's Rapid Fire - May 18, 2018
In a Fortnight – Two Items on CBA’s watch list ahead of Memorial Day include:
- A House Vote on Senate Banking Bill – The Senate’s regulatory relief bill, which CBA supports, is expected to receive a vote in the House this Tuesday, May 22.
- McWilliams Confirmation as FDIC Head – President Trump’s nominee to head the FDIC Jelena McWilliams is expected to receive a confirmation vote in the Senate.
Over the month of May, let’s recap what has occurred in Washington thus far:
- Congress passed a CBA-supported Congressional Review Act resolution repealing the Bureau’s 2013 Auto Bulletin;
- The House passed a CBA-supported small business lending bill, which will authorize the SBA Administrator to increase the 7(a) Loan Program's authorization cap by 15 percent during periods of high demand, among other reforms;
- Two Fed nominees began their confirmation journey with a hearing before the Senate Banking Committee; and,
- CBA’s comments pertaining to the Bureau’s RFI process continue to roll out (See below for more).
Hensarling on Reg Reform – Below are my key takeaways from House Financial Services Committee Chairman Jeb Hensarling (R-Texas) remarks at Politico’s Morning Money Breakfast briefing:
- Rep. Hensarling said he would consider legislation creating a bipartisan commission at the Bureau, here is a rough transcript of his remarks on the topic: “It was in [the regulatory relief bill from last Congress], but Democrats never accepted that so we took it off the table. I am open to a bipartisan commission if Democrats bring it to the table with the requisite number of votes,"
- As previously noted, there will be a vote in the House on the Senate’s regulatory reform bill this Tuesday and Senate Leadership has given an assurance there will be a vote on another financial reform package dealing heavily with capital formation; and,
- Tax reform provided economic growth of three percent and now regulatory reform must pass to provide three percent growth as well.
CBA Comments on Bureau’s Enforcement Processes – CBA’s letter to the Bureau on their enforcement processes focused on the following issues:
- A lack of enforcement coordination with other agencies;
- The confusion surrounding the Bureau’s use of “responsible conduct” for enforcements;
- The Bureau’s past use of press releases to paint a picture of guilt;
- The need to end regulation by enforcement; and,
- Ensuring the timely resolution of investigations.
CBA submitted comments jointly with the Consumer Mortgage Coalition and Financial Services Roundtable. A full copy of the letter is available here.
For an overview of the Bureau’s RFI process and CBA’s positions, please view our RFI Library.
Next Up: Supervision Processes – Comments on the Bureau’s supervision processes are due Monday, May 21 and CBA will be commenting.
FinCEN Responds to CBA's Concerns on CCD Rule - As we noted in last week’s Rapid Fire, FinCEN’s customer due diligence rule, which requires banks and other financials to collect information about who the true owner of an account may be, went into effect last Friday. In response to CBA’s concerns, FinCEN announced they would temporarily exempt certificate of deposit rollovers and loans which renew automatically from the rule. Additionally, CBA sent a letter to Congress voicing support for the rule, but requested Congress work with federal regulators to provide greater flexibility during the initial implementation and examination process since exam guidelines were only released the same day the rule took effect.
FUTURE OF TECHNOLOGY IN BANKING
Fresh Ideas in Bank Marketing – It is said we overestimate the amount of technological change in the short term, but underestimate the amount of change in the long term. This week, CBA hosted a deep-dive webinar with Harland Clarke on the results of their Survey on Financial Marketers. Here are our top takeaways from the survey, which sought to better understand what lies ahead:
- 92 percent have seen an increase in their digital marketing budget;
- 41 and 36 percent have seen a decrease in their mass media and direct marketing budgets, respectively;
- 82 percent said data drives their marketing plan;
- 48 percent plan to increase their marketing budget in 2018; and,
- The top three metrics used to measure marketing performance include growth in the number of account holders, deposit volume and year-over-year loan volume.
I always challenge myself and the CBA Team to look at new information and think about how we can better serve members given the impact of digital technologies and data analytics.
Citizens Bank Goes Digital – Citizens Bank will launch an online-only bank offering consumers savings accounts and certificates of deposit. Speaking on the initiative, CBA Board Chair Brad Conner said, “we have invested heavily in data and analytics to better understand and react to customer needs and we are excited to engage with them in one of our industry’s fastest-growing deposit channels.” Expect the platform to go live in the third quarter of 2018.
TRENDING IN RETAIL BANKING
Banking’s Newborns: De Novos Pick Up Steam – Between 2011 and 2016, only two new banks opened. In 2017, five banks debuted and in 2018, three banks have opened with two other applications approved since December, 2017. A once dearth environment for new banks seeking to test the waters has now picked up some steam. Currently, there are pending de novo applications in Nevada, Michigan, Florida, Massachusetts, New York and Tennessee. There is no better example of a changing current than North Carolina, which lost around half of its banks since 2010. As of this moment, North Carolina has five investor groups discussing opening new banks.
Survey Says… – I’ll save you the Family Feud impressions, but CBA’s recent membership survey seeking to better understand where and how you get your news was highlighted by one consistent fact: CBA Members get their news from CBA. At CBA, we strive to provide you with breaking news updates via membership alerts and a comprehensive daily banking news brief. We are glad to know our membership finds value in these services. We will continue to provide the information you need to thrive.
CBA LEADERSHIP SPOTLIGHT
CBA Committee Chair Michael Young of TIAA – CBA Deposits and Payments Committee Chair Michael Young of TIAA has been in banking for more than 20 years and we are excited to have him in a leadership role at CBA. He has been a member of the committee since 2012, chair of the group since November 2016 and he is a returning speaker at CBA LIVE. In addition to TIAA, Michael has worked for two other CBA Member banks. He is a graduate of Xavier University and active in his community. He was a leadership coach with the Executive Service Corps of Cincinnati, a non-profit dedicated to helping community organizations achieve life-changing impact in the communities they serve, and currently sits on the Alumni Board of Governors for Elder High School, a college-prep school in Cincinnati. We are glad to have Michael onboard at CBA.
Jennie Carlson – Jennie Carlson is set to retire as U.S. Bancorp’s chief human resources officer.
M&T Bank Promos – Ann Woloszynski and Kelly Close were promoted to group vice presidents from administrative vice presidents at M&T Bank.
Janis Bowdler – JPM has a new philanthropic investment strategy lead. The bank named Janis Bowdler as president of the JPMorgan Chase Foundation
South Dakota Coyotes – Always a pleasure to host students from the University of South Dakota’s Political Science Department. While I’m an LSU Ragin’ Cajun at heart, it was fun being a South Dakota Coyote for a day and it was great meeting with many bright students. If you did not know, CBA’s Legislative Manager Ryan Blake and Director of Associate Membership, Exhibits and Corporate Philanthropy Maren Colon are alums of the University of South Dakota.
This week, CBA OnSite Education was in Auburn Hills, MI teaching MarketSim to 30 students at Comerica. Learn more about CBA OnSite Education here.