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New Year Brings Big Changes in Washington, Albany

Public Affairs Update  |  By Stephen W. Rice

New York community banks will operate in a new environment in 2017 and the immediate future. The winds of change have swept through Washington, D.C. and, to a lesser extent, through Albany in terms of the legislative and regulatory arenas.
There is a new chairman of the U.S. Senate Banking Committee, Sen. Mike Crapo (R-ID). There are four new members of the New York Congressional Delegation (Republicans John Faso and Claudia Tenney, and Democrats Tom Suozzi and Adriano Espaillat) – and there are two new New Yorkers on House Financial Services Committee (GOP Reps. Lee Zeldin and Claudia Tenney), bringing the total number of New Yorkers on that key committee to six.
The new Trump administration pledged a new focus on deregulation and tax reform, with strong support from Congressional Republicans. The president signed an executive order requiring federal agencies to identify two regulations they plan to cut whenever requesting a new one.
The president also described the Dodd-Frank law as “a disaster,” and his choice for Treasury Secretary, Steven Mnuchin, signaled a preference to “roll back” the act, perhaps including addressing the Volcker Rule and the re-structuring of the Consumer Financial Protection Bureau.
House Financial Services Committee Jed Hensarling (R-TX) plans to enact his Financial CHOICE Act to replace much of Dodd-Frank. Among other things, it would repeal Durbin Amendment price controls on debit card interchange, reform burdensome and costly mortgage-lending requirements, and provide relief from excessive call report and data-collection mandates.
In Albany, there has also been a flurry of activity and change in both personnel and initiatives that could impact community banks.
There are new chairmen of the State Senate and State Assembly Banks Committees (Sen. Jesse Hamilton, IDC-Brooklyn and Assemblyman Ken Zebrowski, D-Rockland County).
The Department of Financial Services has enacted new regulations on both cybersecurity and abandoned or vacant “zombie” properties. (IBANYS worked hard to craft exemptions for community banks in both regulations.)
Gov. Andrew Cuomo’s proposed state budget legislation for 2017-18 included establishing a “bad actor” ban provision, based on “Wells Fargo” type behavior; higher DFS assessment fees for examined institutions, and empowering the State DFS Superintendent in legal actions vis-à-vis the state attorney general.
So, change has come in large doses. Clearly, it has been a very active winter for IBANYS as we work to represent the interests of New York community banks in Albany and, working with the Independent Community Bankers of America, in Washington, D.C. New policymakers and policies pose new challenges – but also new opportunities. The present, and future, will require the continued active engagement and participation of our member banks. Together, we will work to protect and enhance our industry and the communities and customers we serve all throughout New York state.■

Steve Rice coordinates government relations and communications for the Independent Bankers Association of New York State. He has worked in the New York banking industry and New York state government for more than three decades.

Posted on Wednesday, March 29, 2017 (Archive on Tuesday, June 27, 2017)
Posted by Scott  Contributed by Scott


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