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Community Banks Building on a Strong 2015

By John Witkowski

I’m pleased to report our industry saw a strong finish to 2015,with positive results in both Washington, D.C. and Albany. Moreover, we’ve begun 2016 with a proactive agenda to preserve, protect and advance the interests of New York’s local community banks.


The highway bill included key reg relief for community banks, including:
Exempting institutions under $10 billion in assets from cuts to Federal Reserve stock dividends. According to estimates, the exemption will save approximately $60,000 annually, while a $500 million and $1 billion bank would save roughly $300,000 and $600,000 per year, respectively.
Advancing several provisions from ICBA’s “Plan for Prosperity” regulatory relief agenda, strongly supported by IBANYS. The new law provides that on the 10-year Treasury rate with a maximum of 6 percent.
Eliminating redundant privacy notice requirements.
Expanding the 18-month exam cycle.
Easing CFPB restrictions on rural mortgage lenders.
Expanding TruPS CDO relief for small bank holding companies, and allowing thrift holding companies to take advantage of new SEC registration thresholds.
Restoring funds cut from the crop insurance program that would have significantly curtailed the private-sector delivery of federal crop insurance,.
Dropping language that would have extended higher Fannie Mae and Freddie Mac guarantee fees.

Federal Budget Agreement: Tax Extenders, Cybersecurity Assistance
The agreement included the ICBA-advocated Cybersecurity Information Sharing Act, which encourages the public and private sectors to share critical cyber-threat information. In addition, it:
Required regulators to study and report to Congress the effect of the Basel III capital requirements on mortgage-servicing assets.
Included a $3 billion increase in funds for the Small Business Administration’s 7(a) guaranteed loan program.
Reauthorized the SBA’s expired 504 refinance program.
Continued fee waivers for loans to veterans.
Included a permanent five year S-corp recognition period for built-in gains.
Permanently extended the S-corp stock basis adjustment for charitable contributions of property.
Made permanent a $500,000 Section 179 expensing limit.
FASB agreed to delay consideration of its CECL proposal until sometime during 2016 instead of the original date of Dec. 2, 2015. (Note: A delegation of community bankers met with FASB to address our concerns going forward.)

IBANYS Testimony on
Small Business Access to Credit
The hearing’s focus was to explore the needs of small businesses to access credit, and to review state policies and programs designed to assist in the financial marketplace.
The new year has opened with new challenges on familiar issues. In Albany, the credit unions are again seeking expanded fields of membership, powers and authorities. In Washington, the NCUA proposed changes to credit union field-of-membership rules that would nearly eliminate the common-bond requirement. Among other changes, community-chartered credit unions would be able to claim that a congressional district is a “well-defined local community,” which would allow community credit unions in seven states to serve their entire state. This NCUA proposal would make credit unions less restricted by geography, further expanding their footprint while maintaining their exemption from taxation and federal financial regulations facing taxpaying community banks. IBANYS is opposed to this measure and has encouraged our member banks to voice their opposition.
There is still a great deal of work to do in 2016. Together, we will continue building on the strong foundation we have established for members and our industry. ■

John Witkowski is president and CEO of the Independent Bankers Association of New York State. He may be reached at or (518) 436-4646.

Posted on Tuesday, February 23, 2016 (Archive on Monday, May 23, 2016)
Posted by Scott  Contributed by Scott


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