CBAI Convention Breakout Session Featured FASB/CECL Community Bankers Advocacy Success

During a lively Breakout Session at CBAI's 42nd Annual Convention community bankers heard first-hand accounts of how their aggressive advocacy efforts, and those of the associations that exclusively represent their interests, resulted in significant revisions to the proposed Financial Accounting Standards Board’s (FASB) Current Expected Credit Loss (CECL) model.

CBAI member Greg Ohlendorf (President and CEO of First Community Bank and Trust in Beecher, Illinois) and James Kendrick (ICBA’s Vice President of Accounting Conv CECLFASB Advocacyand Capital Policy) represented the nation’s community banks in numerous meetings with FASB and described the significant concessions and accommodations community bankers received leading up to the final release of CECL. The new accounting rule will now be more manageable than what was first proposed as it will not require complex and costly models, benchmark increases to allowance levels, or loss forecasts for the entire life of loan.

Kendrick and Ohlendorf gave the Breakout Session attendees a revealing peek behind the curtain of this regulatory rulemaking process including the events leading up to a contentious meeting with FASB on the cusp of the release of the CECL. Community bankers also learned what the banking regulators are saying about their CECL implementation plans and what bankers need to be doing (and not doing) right now to prepare for this new mandatory credit loss model.

This informative discussion clearly reinforced the fact that community banker advocacy is important and truly does make a difference.

September 17, 2016



CBAI Articles

FASB Revises the Current Expected Credit Loss Model – June 16, 2016

CECL Update – CBAI Member Attends FASB Meeting – February 15, 2016

ICBA Press Releases

FASB Makes Major Improvements to Accounting Standard – June 16, 2016

FASB Continues Progress with Revised Accounting Disclosure – April 27, 2016

CECL Reforms Show FASB Listening to Community Banks – April 22, 2016

ICBA to FASB: Hit Stop Button on Dangerous Accounting Plan – February 4, 2016


Joint Statement by the Regulators – June 17, 2016

ICBA Questions and Answers


ICBA Files Suit Against NCUA for Unlawful Commercial Lending Limit Rulemaking

On September 7, 2016, the Independent Community Bankers of America (ICBA) filed suit against the National Credit Union Administration (NCUA) for unlawful rulemaking for allowing tax-exempt credit unions to exceed commercial lending limits set by Congress. The NCUA rule would dramatically expand lending loopholes for credit unions by allowing them to exclude purchased nonmember commercial loans and participations from the calculation of their aggregate member business loans.

This unlawful rulemaking is the latest step in the NCUA’s transformation from a federal financial regulator to a cheerleader for its taxpayer-subsidized industry. The NCUA action in rulemaking is contrary to the plain language of the Federal Credit Union Act, as amended by the Credit Union Membership Access Act, which expressly limits the amount of member business loans that may be held on credit union balance sheets.

Opposing the expansionist agenda of credit unions has long been a federal policy priority of CBAI. CBAI which fully supports the ICBA legal action against the NCUA for ignoring its statutory boundaries and its blatant end-around Congress. Read Complaint.

September 7, 2016


State Bank of Toulon Hosts Meeting with Congressman Darin LaHood (R-18)

CBAI Regional Vice Chairman Doug Parrott, President and CEO of State Bank of Toulon, hosted a meeting with Congressman Darin LaHood (R-18) and Congressional District Director Brad Stotler to discuss community bank issues and opportunities. Joining in the meeting were Andrew Black (President and CEO of Princeville State Bank), Keith Douglas (President and CEO of Tompkins State Bank, Steve Leuthold (President and CEO of State Bank of Speer), and David Schroeder (CBAI Vice President Federal Governmental Relations). The roundtable discussion covered a variety of topics of interest to both the community bankers and Congressman LaHood.

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Doug Parrott started the meeting by thanking Congressman LaHood for cosponsoring the CLEAR Act (H.R. 1233) which includes many community bank regulatory relief measures contained in the Independent Community Bankers of America (ICBA) Plan for Prosperity, and also for signing a bi-partisan United States House of Representatives’ letter to the Consumer Financial Protection Bureau asking them to exempt community banks from their rules.

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The Congressman asked what keeps community bankers up at night. The bankers highlighted a diverse list of challenges they face in meeting new regulatory requirements while trying to maintain their focus on serving their communities. The issues included: overregulation, the “trickle down” of many regulations meant for the largest banks being applied to community banks and its unfortunate impact on industry consolidation, the new Department of Labor overtime rules and the impact on small banks and small business, the new Qualified Mortgage (QM) requirements discouraging residential mortgage lending, harmful Farm Credit and credit union expansion, the importance of maintaining the crop insurance programs, rural economic development, and the various issues the State of Illinois and its citizens face with the budget stalemate and growing indebtedness.


Congressman LaHood appreciated the opportunity to meet with local community bank leadership and the bankers expressed their sincere appreciation for the Congressman taking the time to visit with them about their issues and opportunities.

August 31, 2016


Governor Signs Vehicle Storage Fee Initiative

Last Friday, Governor Rauner signed into law HB 2642 (Cassidy/Koehler) which amends the Labor and Storage Lien Act and the Labor and Storage Lien (Small Amount) Act. P.A. 99-0759 requires repair shops and garages that seek to impose fees in connection with the storage of a vehicle, to provide written notice to the lienholder of record prior to the assessment and accrual of such fees. The written notice must include the rate at which fees will be incurred and must be sent by certified mail.

The new law also requires repair shops and garages to provide an opportunity to inspect the vehicle on the premises where the vehicle is stored, and allows the lienholder to choose whether to make payment with cash, cashier’s check, certified check or wire transfer. This bill was a joint initiative introduced by the Illinois Credit Union League, and supported by CBAI, the Illinois Bankers Association, and the Illinois League of Financial Institutions.

CBAI thanks the sponsors, Representative Kelly Cassidy (D-Chicago) and Senator David Koehler (D-Peoria) and also Senate President John Cullerton and his staff for their persistency in getting this bill passed after it initially stalled in the House.

August 15, 2016


Strong Advocacy Efforts Helped Spur Proposed Call Report Changes

The results are indisputable! Community bankers’ strong advocacy efforts, combined with those of the ICBA and CBAI, have led to the long-awaited proposed changes to the Call Report requirements for community banks. 

In August of 2014, approximately 15,000 community bankers (over 1,000 of which were from Illinois) signed an ICBA petition to the Federal Financial Institutions Examination Council (FFIEC) calling for relief from increasingly onerous quarterly Call Report requirements.


In a September of 2014 comment letter to FFIEC, as part of the EGRPRA process to eliminate of unnecessary or outdated regulations, CBAI proposed that certain community banks be entitled to file short-form Call reports for the quarters ending March and September and file full Call Reports for the other quarters.


In a November of 2015 comment letter regarding a FFIEC proposal, CBAI called for meaningful regulatory relief for community banks by streamlining the existing Call Report and renewed its call to provide a short-form version of the Call Report for two of the four quarters.  CBAI stated that regulatory relief for community banks must be the Agencies number one priority.  The Agencies' current efforts at meaningful regulatory relief are insufficient and much more needs to be accomplished. 

Finally, on August 5, 2016, a proposal was released by the banking regulators to implement Call Report regulatory relief.  The regulators have proposed that domestic banks with less than $1 billion in assets, approximately 90% of filers, would qualify for a streamlined Call Report.  This new report would have 40% fewer data items, bringing the number down from roughly 2,400 to 1,450 and the page count down from 85 to 61.  The agencies intend to begin implementing the changes on March 31, 2017.

CBAI will be carefully reviewing the 57 page proposal and provide our observations and recommendations for improvements.  Read FFIEC News Release.

August 5, 2016