Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois Community Bankers Association of Illinois
 
     A Bi-Weekly News Bulletin for CBAI Members               August 12, 2009 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois


  • CBAI Urges Congressional Contacts During August Recess
  • Mortgage Servicing Options in Wake of TBW Failure
  • Governor Quinn Signs Mortgage Fraud Protection Bill
  • CBAI Endorses Roger Lehmann and Steven Rosenbaum for Re-election to the FHLB of Chicago Board of Directors
  • Donate to the BancPac Auction
  • CBAI’s 35th Annual Convention Offers Hot Speakers and Topics
  • BAKER Market Update
  • Private Economists Believe Recession Will End in Third Quarter
  • Fed Expected to Keep Rates Low
  • FDIC Releases Guidance on Allowance for Loan Losses for Junior Liens
  • Post ATM-Fee Signs, Avoid Litigation
  • Stimulus Funds for Rural Broadband
  • What Banks Need to Know About the Swine Flu
  • Certain Credit Card Rules Take Effect August 20
  • Fed Adjusts Disclosure Trigger
  • Director of Federal Housing Finance Agency Resigns
  • Wall Street Bankers Raking in Billions in Bonuses
  • CBAI Foundation for Community Banking Receives First Book Payment
  • CBAI’s Banking Essentials Series Offers New Format


  • CBAI Urges Congressional Contacts During August Recess

    Congress has adjourned for the August recess, and many lawmakers are accessible in their respective districts. Community bankers are encouraged to contact their congressmen to discuss the significant financial restructuring and other issues that await them when they return to Washington in September.

    Here are talking points on the key issues you can provide to your congressman:
    H.R. 3126, the Consumer Financial Protection Agency Act of 2009
    H.R. 2897, the Bank Accountability and Risk Assessment Act of 2009, and CBAI’s Letter to Congressmen urging support and co-sponsorship. Progress has been made on this issue as two more members of the Illinois Congressional delegations, Representative Schakowski and Representative Quigley, have recently agreed to co-sponsor H.R. 2897. Please express your gratitude for their continued support of community banking when you contact these two members, and continue to urge the other members of Congress to support and co-sponsor this important legislative measure.
    Regulatory Restructuring
    Congressional Contact Information

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    Mortgage Servicing Options in Wake of TBW Failure

    Last week, Taylor, Bean and Whitaker
    announced it had ceased all operations leaving scores of community banks nationwide in the lurch.

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    Governor Quinn Signs Mortgage Fraud Protection Bill

    On July 31, 2009, Governor Pat Quinn signed into law a mortgage fraud protection measure to provide greater consumer safeguards for those seeking homes. The provisions increase oversight of residential mortgage companies and mortgage loan originators by the Illinois Department of Financial and Professional Regulation by enrolling the state in the Nationwide Mortgage Licensing System and Registry.
    See Governor’s Release.

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    CBAI Endorses Roger Lehmann and Steven Rosenbaum for Re-election to the FHLB of Chicago Board of Directors

    CBAI is proud to endorse the candidacies of Mr. Roger Lehmann and Mr. Steven Rosenbaum for re-election to the Federal Home Loan Bank of Chicago Board of Directors.
    More.

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    Donate to the BancPac Auction

    BancPac’s Silent and Live Auction will be held the evening of Thursday, September 24, 2009 and will kick off the Annual CBAI Convention & Expo. Donate to BancPac’s Auctions….Silent and Live!
    Click here for details!

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    CBAI’s 35th Annual Convention Offers Hot Speakers and Topics

    It’s a serious convention for a serious time! CBAI’s 35th Annual Convention & Expo to be held September 24-26 at the new Renaissance Hotel in Schaumburg, concentrates on the issues facing community bankers and new ways the best minds in community banking are finding to reckon with these issues. This year’s convention provides you with the power of ideas and innovation to assist your community bank not only to survive, but thrive. Speakers on the agenda include future trends expert Peter Leyden and real-life Indiana Jones David Miln Smith, who teaches how to convert the fear of change from an enemy to an ally. Plus, you won’t want to miss out on the 20 break-out sessions featuring expert speakers and timely topics! For more information on speakers, please
    click here.

    For complete information on the convention, or to register, please click here.

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    BAKER Market Update

    Job losses in July were much less than economists predicted; the jobs report indicates the rate of economic decline continues to slow; and inflation continues to slow as well.
    More.

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    Private Economists Believe Recession Will End in Third Quarter

    The Blue Chip Economic Indicators survey of private economists released on August 10 revealed that about 90 percent of the respondents believe the worst economic decline since the Great Depression will end this quarter. There was less certainty, however, centers on the speed, strength, and durability of the recovery.
    See article.

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    Fed Expected to Keep Rates Low

    The Federal Open Market Committee meets today to address interest rates, and it is expected to acknowledge that economic growth will be faster than anticipated but will keep the benchmark interest rate target near the lowest on record.
    See article.

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    FDIC Releases Guidance on Allowance for Loan Losses for Junior Liens

    The FDIC released guidance on allowing for loan and lease losses on loans secured by junior liens on one-to-four family residential properties. The
    Financial Institution Letter notes banks must analyze collectability of its loans held for investment and maintain an allowance for loan and lease losses (ALLL) on a quarterly basis.

    Appropriate ALLLs cover estimated credit losses on individually evaluated loans that are determined to be impaired and on groups of loans with similar risk characteristics that are collectively evaluated for impairment. After determining the appropriate historical loss rate for each group of junior lien loans with similar risk characteristics, management should consider factors that are likely to cause the estimated credit losses on these loans as of the ALLL evaluation date to differ from the group’s historical loss experience. Failing to recognize estimated credit losses could delay appropriate loss-mitigation activity. Examiners will continue to evaluate the effectiveness of loss-mitigation strategies.

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    Post ATM-Fee Signs, Avoid Litigation

    ICBA is strongly encouraging community banks nationwide to institute ongoing procedures for ensuring signs disclosing ATM fees are posted. Some CBAI members have reported being fined. Consumers and attorneys are trolling for financial institution ATM locations that do not have the required physical signage and executing transactions to incur surcharges. They then file class-action lawsuits seeking statutory damages and payment of litigation costs and reasonable attorneys’ fees for the financial institution’s failure to comply with disclosure requirements.

    Section 205.16 of Regulation E (The Electronic Fund Transfer Act) requires an ATM operator to disclose any fees on a physical sign “in a prominent and conspicuous location on or at the ATM” and on the ATM screen before imposing fees.

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    Stimulus Funds for Rural Broadband

    A $7.2 billion stimulus initiative in the Recovery Act aims to expand broadband access in rural areas. The Federal Communications Commission is charged with presenting lawmakers with a national broadband plan by February 17, 2010, and a primary goal is to get affordable broadband to as many people as possible.
    See article.

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    What Banks Need to Know About the Swine Flu

    With the H1N1 influenza virus (swine flu) expected to return to America with a vengeance this fall, banks are encouraged to develop a keen understanding of the virus and prepare for its impact. Bank Information Security has prepared an
    informative article on the subject.

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    Certain Credit Card Rules Take Effect August 20

    The FDIC recently announced that banks must soon comply with certain rules of the Credit Card Accountability Responsibility and Disclosure Act of 2009. Although most of the rules will not go into effect until February and August of 2010, the following rules will be effective on August 20, 2009: 1) creditors must deliver statements at least 21 days before the payment is due on all open-end consumer credit accounts, and 2) creditors must give 45-days’ notice of increases in the annual percentage rate or other significant changes in terms, including a notice of right to cancel the account.
    More information.

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    Fed Adjusts Disclosure Trigger

    On August 10, 2009, the Federal Reserve released its annual adjustment of the dollar amount of fees that triggers additional disclosure requirements under the Truth in Lending Act for home mortgage loans that bear rates or fees above a certain amount.

    The dollar amount of the fee-based trigger has been adjusted to $579 for 2010 based on the annual percentage change reflected in the CPI in effect on June 1, 2009. The adjustment is effective January 1, 2010.
    More information.

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    Director of Federal Housing Finance Agency Resigns

    James B. Lockhart, Director of the Federal Housing Finance Agency (FHFA) , announced on August 6, 2009, that he will soon leave the agency. He was involved in the implementation of GSE reforms that became effective on July 30, 2008, which made the FHFA a stronger regulator for Fannie Mae, Freddie Mac, and the Federal Home Loan Banks. Ed Demarco, current COO for the agency, will become the Acting Director of FHFA.
    See Release.

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    Wall Street Bankers Raking in Billions in Bonuses

    Amid growing unemployment, giant Wall Street firms that received federal bailouts to fend off failure are still doling out billions of dollars in bonuses. The usual suspects, Goldman Sachs, JP Morgan Chase, and Morgan Stanley, led the largess that Treasury Secretary Tim Geitner said has “encouraged excessive risk-taking.” A compensation reform bill has passed the House and awaits Senate action next month.
    More information.

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    CBAI Foundation for Community Banking Receives First Book Payment

    Two new books for bank customers promote financial education and help improve financial literacy in Illinois. Available to CBAI members, one dollar from the sale of the two books benefits the CBAI Foundation for Community Banking, which endows the 15 scholarships offered every year to high-school seniors.

    The High School Money Book provides high-quality information on personal finance for high-school students. A Parent’s Guide to Wills & Trusts is a comprehensive and valuable resource for parents and grandparents.
    Click here for more details.

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    CBAI’s Banking Essentials Series Offers New Format

    CBAI is pleased to present
    “Banking Essentials,” four one-day seminars designed to provide a complete knowledge of banking principles and operations. A must for the newer community bank employee, it is also geared toward veteran employees as a refresher course. New this year, the four quarters of the Banking Essentials Series will be offered in one location and structured as two, two-day sessions. As such, quarters one and two will be offered on consecutive days in August, and quarters three and four will be offered on consecutive days in February, to cut down on travel for your convenience. All seminars are held at the CBAI Headquarters in Springfield. Seminar topics and content remain the same as previous years. While it is recommended that the individual attend all four quarters of the series to receive an entire overview of banking, each quarter's material stands alone; one quarter is not a prerequisite for another.

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