Richard's Rapid Fire - July 8, 2016

Same-Day Paychecks  

According to a report from the New York Times this week, a growing number of employers are testing ways to provide their employees with faster access to their paychecks for a fee ranging from $0.50 to $5.  Given the Federal Reserve’s recent report that nearly half the country cannot afford a $400 emergency expense, we certainly welcome these kinds of innovations.  Additionally, we encourage regulators to reconsider rules and regulations which pushed banks out of the small-dollar lending space.  The reality is bank products helped countless consumers obtain access to much needed credit, rather than pushing them into the arms of pawnshops, offshore lenders, and fly-by-night entities.  When it comes to helping consumers make ends meet, all options should be on the table.

 

Hillary Clinton Proposes Moratorium on Federal Student Loan Repayment

Hillary Clinton captured headlines this week after proposing a host of student lending reforms.  Included in Clinton’s proposal is a three-month moratorium on the repayment of federal student loans.  Unfortunately, a three-month moratorium will not provide consumers with the long-term solutions they need.  Unlike federal student loans, nearly 98 percent of private student loans are being successfully repaid—putting delinquency rates for private borrowers at their lowest level since before the 2008 crisis.  Private lenders are required to provide 18 separate disclosures, three different times, before a loan is issued.  These upfront disclosures help ensure consumers are provided the greatest consumer protection of all: a robust underwriting process that includes an ability-to-repay test.  Unfortunately, the federal government is exempt from providing these disclosures and others like them.  To make college more affordable, we need to help students become better informed, more careful borrowers – a three-month moratorium will not achieve this end.

 

Once Again, Federal Government Exempts Itself

This week, the Federal Communications Commission (FCC) carved out the federal government from Telephone Consumer Protection Act (TCPA) liability when conducting “official government business” such as telephone town halls and Social Security disability calls.  Like the exemption under the Budget Control Act, this is yet another example of government hypocrisy.  FCC Commissioner O’Rielly called this “a terrible outcome,” and we agree.  When CBA member banks need to contact their customers for official business like balance alerts, money management notifications, and the like, they can be subjected to crushing fines under the TCPA.  The double standard must stop – what is good for the goose is good for the gander.   

 

CBA Welcomes 105 Freshmen to Executive Banking School

CBA is pleased to welcome an outstanding group of students to CBA’s Executive Banking School Class of 2018!  This year’s freshmen class comprises 105 students representing 28 banks from across the country.  Students will join our nearly 200 returning students from the classes of 2016 and 2017 in Greenville, S.C. for 10 days of custom-tailored executive training.   In 2016, the school will feature three prominent speakers from the retail banking industry: Will Howle, CBA Chairman of the Board and President of U.S. Retail Banking at Citi; Cathy Nash, President and CEO of Woodforest National Bank; and Chuck Kim, Executive Vice President and CFO of Commerce Bancshares.  Educating the next generation of retail banking leaders is a truly exciting experience, and we look forward to seeing the faculty and students soon!

 

Three Things to Know to Be In the Know

Slowdown in Shadow Lending Tightens Credit on Main Street - WSJ

Ohio’s Cordray seen as a VP choice for Clinton - The Blade

Millennials Show Financial Savvy: Credit Karma

 

Lagniappe

Jim Godwin, Brant Standridge and Dontá Wilson were named to BB&T executive management team.  Jim was named Deputy Chief Risk Officer; Brant was named Lending Group Manager; and Dontá was named Chief Experience Officer.

Edward Robinson was named senior vice president and head of Fifth Third Mortgage by Fifth Third Bancorp.

Hats off to CBA Board Member Mark Rendulic of First Niagara for his weekend woodworking, which included two new projects for his home.  Nice job!