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CBAI Meets with IDFPR and its New Chicago District Manager for Bank & Thrift Supervision

On Monday, November 7, 2016, CBAI member and ICBA leadership banker Greg Ohlendorf – President and CEO of First Community Bank and Trust in Beecher, and CBAI Vice President of Federal Governmental Relations – David Schroeder, met with the Illinois Department of Financial and Professional Regulation’s Secretary – Bryan Schneider, Director of Division of Banking (via teleconference) – Kerri Doll, and the Department’s new Chicago District Manager for Bank & Thrift Supervision – Paul Ward, to discuss a variety of issues of importance to Illinois community banks.

Ohlendorf began the meeting by discussing his bank’s experience with a recent state examination and recommended several areas of improvement to reduce future examination burden. Director Schneider discussed the Department’s efforts to hire additional personnel and more efficiently utilize the resources they currently have. There was also a discussion on Director Schneider’s involvement with the Conference of State Bank Supervisors and a recent article he wrote on fintech regulation.

Schroeder welcomed this opportunity to discuss CBAI’s federal government relations activities. He highlighted the importance of the Associations exclusive representation of Illinois community banks and also CBAI being the only state banking trade association to have someone exclusively dedicated to the federal agenda. Schroeder stated that he travels to Washington, D.C. on a quarterly basis and visits with every office of the Illinois Congressional Delegation as well as our national association (ICBA) and various federal regulators.

There were a wide range of issues discussed at this meeting.

    CBAI is concerns that the scope, severity and duration of the fraud and scandal at Wells Fargo, the second largest bank in the country, will negatively impact the prospects for regulatory relief for well-deserving community banks. Schroeder encouraged the Department to do it is able to help prevent this from occurring.

    Ohlendorf and ICBA’s Vice President of Accounting and Capital Policy, James Kendrick held a CBAI Convention Breakout Session on advocacy success with FASB’s CECL proposal. Ohlendorf urged the Department to thoughtfully implement the new accounting rules with the hard-won community bank concessions in mind.

    CBAI encouraged the CFPB, in a recent comment letter, to exempt community banks under $10 billion in assets from the proposed payday and vehicle title lending rules. These proposed rules will impact community bank small-dollar consumer lending. The proposed exemption requirements are ridiculously complicated, and the penalty for noncompliance is so punitive (unfair and deceptive practice), that community banks will be forced to stop making these types of consumer loans in the communities.

    CBAI encouraged the federal regulators, in a recent comment letter, to provide broad community bank Call Report regulatory relief for well capitalized and highly rated community banks by only requiring a very limited number of schedules to be reported during the first and third quarters.

    Also, CBAI urged the Department of Treasury/IRS, in a recent comment letter, to withdraw a proposal that would increase estate taxes and further consolidation among family-owned community banks by disallowing valuation discounts for minority and non-marketable interests.

CBAI appreciated this opportunity to be introduced to Paul Ward and to share with the IDFPR our position on important federal issues and challenges facing Illinois community banks.