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Security
Trade Groups Announce Cybersecurity Partnership

ICBA and a coalition of trade associations representing the financial services and retail industries announced a cybersecurity partnership to enhance collaboration in protecting consumers. The partnership will explore how to increase information sharing, improve card security technology and maintain the trust of customers.

“Data protection is a shared responsibility of everyone involved in the payments processing chain,” ICBA President and CEO Cam Fine said. “Consumer confidence in the payments system is vital for retailers, networks, processors, telecom providers, and card issuers and is at the heart of the customer-bank relationship.”

The participating trade associations will form working groups made up of themselves, member companies and other stakeholders. The forum will serve as an effective way for the industries to discuss areas of agreement and disagreement and to seek solutions.

ICBA is joined on the coalition by the American Bankers Association, the American Hotel & Lodging Association, The Clearing House, the Consumer Bankers Association, the Financial Services Roundtable, the Food Marketing Institute, the International Council of Shopping Centers, the National Associations of Convenience Stores, the National Grocers Association, the National Restaurant Association, the National Retail Federation and the Retail Industry Leaders Association. Read Joint News Release.



Security
ICBA Welcomes NIST Report on Cybersecurity
ICBA welcomed the release of a cybersecurity framework by the National Institute of Standards and Technology at the direction of President Barack Obama. The NIST worked with the banking and financial sectors to establish a voluntary framework that reflects current cybersecurity best practices to strengthen the nation’s security infrastructure.

The NIST framework, which was directed by an executive order by the president a year ago, is a voluntary risk-based set of industry standards and best practices to help organizations manage cybersecurity risks. It is designed to help organizations align their cybersecurity activities with their business requirements, risk tolerances and resources.

ICBA said the report comes at a critical time as the nation faces growing cybersecurity risks. The association noted that cybersecurity is a top priority for the nation’s community banks.

ICBA said it looks forward to continuing to work with the Financial Services Sector Coordinating Council, the Obama administration and Congress to protect consumers and their communities from the growing cybersecurity threat. Read the NIST Framework. Read ICBA Release.



Security
Senators Propose New Retail Information Sharing Analysis Center
Two Senate Banking Committee members asked the Federal Trade Commission to establish a new center to enable merchants to share cyber threats and vulnerabilities before hackers strike. In a letter to FTC Chairman Edith Ramirez, Sens. Mark Kirk (R-Ill.) and Mark Warner (D-Va.) advocated a new Merchant and Retail Industry Information Sharing Analysis Center.

The lawmakers said the MRI-ISAC would be similar to the 16 existing ISACs, such as the Financial Institutions ISAC, and would provide education to its members on best practices and effective security measures. It could also be used to quickly disseminate information about suspected cyber threats throughout the industry, they said.

ICBA has been communicating frequently with Congress on the impact of recent retailer data breaches on community banks and the need for a stronger payments system. In meetings, committee hearing statements and letters to lawmakers, ICBA has advocated that:
  • the costs of data breaches should ultimately be borne by the party at fault for the breach,
  • all participants in the payments system—including merchants—should be subject to Gramm-Leach-Bliley Act–like standards,
  • a national data-security breach and notification standard should be enacted to replace the current patchwork of state laws, and
  • unnecessary barriers to effective threat-information sharing between law enforcement and the financial and retail sectors should be removed.
More information on ICBA’s efforts and data-security resources for community banks and their customers are available on ICBA’s online security breach toolkit.


Plan for Prosperity
ICBA Thanks CLEAR Relief Act Cosponsors, Continues Grassroots Call
ICBA thanked the cosponsors of the CLEAR Relief Act of 2013 (H.R. 1750/S. 1349) for supporting much-needed regulatory relief for community banks.

In letters to House and Senate cosponsors, ICBA said the bill offers reasonable relief from onerous regulation will better allow community banks to serve the needs of their customers and communities and promote much needed economic activity and job growth.

The legislation, inspired by ICBA’s Plan for Prosperity regulatory relief platform, offers community bank exemptions from mortgage and auditing regulations and supports additional capital opportunities for small bank holding companies. The House and Senate bills were introduced by Rep. Blaine Luetkemeyer (R-Mo.) and Sen. Jerry Moran (R-Kan.), respectively.

ICBA continues encouraging community bankers to view the list of cosponsors for the House and Senate legislation and to urge their members of Congress to cosponsor the legislation if they have not yet signed on. Continued outreach is needed to increase momentum for congressional action on this critical legislation.

Find Cosponsors for H.R. 1750 or S. 1349.

Call Your Lawmakers Today.

Send a Follow-Up Message.



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Mortgage
Senators to CFPB: Consider Mortgage Rule Impact on Rural Lenders
A group of U.S. senators urged the Consumer Financial Protection Bureau to consider the impact of its mortgage rules on rural communities and the community banks and other small lenders that serve them.

In a joint letter to the CFPB, the senators wrote that the bureau’s proposed definition of “rural” excludes many rural lenders and that it wisely decided in September 2013 to provide a broad exemption for small lenders as it reexamines the definition. They urged the CFPB to adopt definitions of “rural” and “underserved” that include community banks and other lenders serving rural homeowners.

The CFPB is authorized to include balloon-payment mortgages held in portfolio in the “qualified mortgage” definition if the creditor operates predominantly in rural or underserved areas.

The Senate letter was signed by Sens. Al Franken (D-Minn.), Mike Johanns (R-Neb.), Heidi Heitkamp (D-N.D.), Mark Kirk (R-Ill.), Jon Tester (D-Mont.), David Vitter (R-La.), Mark Begich (D-Alaska), Roger Wicker (R-Miss.), Tom Harkin (D-Iowa), Lisa Murkowski (R-Alaska), Mark Pryor (D-Ark.) and Tom Udall (D-N.M.).

ICBA has repeatedly urged the CFPB and Congress to minimize the negative impact of new mortgage regulations. The association continues to advocate that all mortgage loans originated and held in portfolio by community banks receive QM safe harbor legal treatment. ICBA is pursuing a legislative solution through the Plan for Prosperity as well as direct engagement with the CFPB.


Regulation
Yellen: Regulators To Review Volcker Impact on CLOs
Regulators “will look at” the impact of the Volcker Rule on collateralized loan obligations, Federal Reserve Chair Janet Yellen told Congress this week. Yellen told the House Financial Services Committee that regulators will announce whether they will exempt some CLOs from the rule “reasonably soon.”

CLOs are among the financial instruments defined as covered funds under the rule. Depository institutions are required to divest their holdings of such funds.

Following ICBA’s frequent communications and meetings with the banking agencies and Congress, regulators recently released an interim final rule to mitigate the negative community bank impact of a provision affecting collateralized debt obligations backed by trust-preferred securities.

The interim final rule permits banks to retain TruPS CDOs they owned as of Dec. 10, 2013, if the CDOs were issued before May 19, 2010, and are backed primarily by TruPS or subordinated debt of bank holding companies that had less than $15 billion in assets when the securities were issued or of mutual holding companies.

Additional resources are available on ICBA’s comprehensive webpage dedicated to the Volcker Rule’s TruPS CDO provisions.



Regulation
Fed Proposes Repealing Regulations Following CFPB Shift
The Federal Reserve Board requested comment on proposals to repeal its Regulation DD (Truth in Savings) and Regulation P (Privacy of Consumer Financial Information) and to make amendments to the Identity Theft Red Flags rule in Regulation V (Fair Credit Reporting).

The Dodd-Frank Act transferred rulemaking authority for several consumer financial protection laws from the Fed to the Consumer Financial Protection Bureau. Because the CFPB has already issued interim final rules that are substantially identical to the Fed’s Regulation DD and Regulation P, the board is proposing to repeal its versions of those regulations.

Comments on the proposals are due within 60 days of publication in the Federal Register.



Agriculture
USDA Projects Sharp 2014 Decline in Farm Income
Net farm income is forecast to decline 26.6 percent in 2014, according to a USDA Economic Research Service report. Total income is projected to decrease from $130.5 billion in 2013 to $95.8 billion this year.

The 2014 income forecast would be the lowest since 2010, but would remain $8 billion above the previous 10-year average. Adjusted for inflation, net farm income in 2013 is expected to be the highest since 1973. The 2014 net farm income forecast would be the seventh highest in that period.

The value of crop production is expected to decline substantially in 2014, falling back to pre-2011 levels.



Poll
Take This Week’s Quick Poll
Take this week’s Quick Poll on a proposal that the U.S. Postal Service enter the financial services industry, and view results from the previous poll on financial literacy. View the Archive.


Education
ICBA Audio Call Covers What’s Working and What’s Not in Mortgage Reform
An ICBA audio conference scheduled for next week will focus on the community bank challenges, misconceptions and opportunities surrounding new mortgage reforms. “Mortgage Reform: What’s Working and What’s Not,” scheduled for 11 a.m. (Eastern time) Thursday, Feb. 20, will provide practical tips and best practices to ensure community banks are on the right track as they adapt to the new regulatory environment. Register Online.


Leadership
ICBA Nominates New Board of Directors for 2014-15
ICBA announced the nominees for its 2014-15 board of directors. ICBA’s board of directors will vote on the nominations during the 2014 ICBA National Convention, which will be held March 2-6 in Honolulu.

Nominations for the 2014-15 ICBA board of directors include:
  • Chairman, John H. Buhrmaster, ICBA chairman-elect and president of 1st National Bank of Scotia, N.Y.
  • Chairman-elect and Federal Delegate Board chairman, Jack Hartings, president of The Peoples Bank Co. of Coldwater, Ohio
  • Vice chairman, Rebeca Romero Rainey, board chairman and CEO of Centinel Bank of Taos, N.M.
  • ICBA president and CEO, Camden R. Fine
  • Treasurer, Preston Kennedy, president and CEO of Bank of Zachary, La.
  • Secretary, Timothy Zimmerman, president and CEO of Standard Bank of Monroeville, Pa.
  • Immediate past chairman, Bill Loving, president and CEO of Pendleton Community Bank of Franklin, W.Va.
  • Past chairman, Jeffrey L. Gerhart, ICBA past chairman and president and CEO of Bank of Newman Grove, Neb.
  • Past chairman, Sal Marranca, president and CEO of Cattaraugus County Bank of Little Valley, N.Y.
  • Past chairman, Jim MacPhee, CEO of Kalamazoo County State Bank of Schoolcraft, Mich.
  • Past chairman, R. Michael Menzies, president and CEO of Easton Bank and Trust Co. of Easton, Md.
  • At-large director, Noah W. Wilcox, president, CEO and vice chairman of Grand Rapids State Bank of Grand Rapids, Minn.
  • At-large director, Greg Ohlendorf, president and CEO of First Community Bank and Trust of Beecher, Ill.
  • At-large director and Federal Delegate Board representative, R. Scott Heitkamp, president and CEO of ValueBank Texas of Corpus Christi, Texas
  • At-large director and Federal Delegate Board representative, Chuck Johnston, president and CEO of North Valley Bank of Thornton, Colo.
  • Bank Education Committee chairman, Mike Ellenburg, president of First Southern State Bank of Stevenson, Ala.
  • Bank Services Committee chairman, Scott McBride, president of The First National Bank of Buffalo, Wyo.
  • ICBPAC chairman, Jack Hopkins, president and CEO of CorTrust Bank, N.A., of Sioux Falls, S.D.
  • Policy Development Committee chairman, Greg Deckard, president, CEO and chairman of State Bank Northwest of Spokane, Wash.
  • Bank Operations and Payments Committee chairman, Sam Vallandingham, president and CEO of The First State Bank of Barboursville, W.Va.
  • ICBA Consolidated Holdings chairman, Cynthia L. Blankenship, vice chairman and chief operating officer of Bank of the West of Grapevine, Texas
  • Corporate secretary, Mark A. Raitor, ICBA chief operating officer.










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