The President Signed Legislation to Help Mitigate Flood Insurance Rate Hikes

March 21, 2014

The President signed bipartisan legislation to protect homeowners from significant increases in flood insurance premiums. The Homeowner Flood Insurance Affordability Act (H.R. 3370) previously passed the U.S. House by a bipartisan majority of 306-91 and the Senate by a bipartisan majority of 72-22. H.R. 3370 would:

  • reinstate grandfathered status for covered properties,
  • create an annual individual property rate cap (18 percent) to prevent year-over-year rate increases for homeowners,
  • repeal the home-sale and new-policy rate-increase triggers,
  • provide a refund for people who have realized large premium increases due to the purchase of a pre-FIRM subsidized home without the full transparency from the Federal Emergency Management Agency as to the new rate structure, and
  • require FEMA to complete an affordability study and to propose an affordability framework to help homeowners cope with dramatically higher premiums.

CBAI and ICBA support a fully authorized, sustainable and fiscally responsible National Flood Insurance Program.


CBAI Bankers Meet with Congresswoman Robin Kelly

CBAI bankers met with Congresswoman Robin Kelly (D-02) to discuss issues of importance to Illinois community banks. The March 7th meeting took place at the offices of the Economic Alliance of Kankakee County in Kankakee Illinois. The topics of discussion included the uneven playing field between community banks, too-big-to-fail banks and financial firms, credit unions, and farm credit lenders; tiered regulation; the future of the housing GSEs (Fannie Mae and Freddie Mac); safeguarding consumer data (data breaches); specific regulatory relief legislation; and local economic development and housing issues.

CBAI thanks Congresswoman Kelly for meeting with our members to discuss their important issues and concerns.

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Pictured (left to right): Michael O’Brien (EVP and COO - HomeStar Bank, Manteno), Francis Smith (Chairman, HomeStar Financial Group), Catherine Boicken (President - Municipal Bank, Bourbonnais), Congresswoman Robin Kelly, Jeff Hammes (President - Peoples Bank of Kankakee County, Bourbonnais and member of CBAI’s Board of Directors), Edward Meier (President - National Bank of St. Anne), Scott Smith (Vice President - First Bank and Trust of Illinois, Kankakee), and Larry Mulder (EVP - First Bank and Trust of Illinois).



CBAI Urged CFPB to Exempt Community Banks from New Debt Collection Rules

February 18, 2014

In a recent comment letter, which was sent in response to an advanced notice of proposed rulemaking, CBAI urged the Consumer Financial Protection Bureau to recognize that community banks do not abuse consumers with unfair debt collection practices and to exempt community banks from any new debt collection rules.

Regulations already exist regarding fair debt collection practices. More rigorously enforcement of the existing rules against those who are breaking the existing rules is clearly what is needed. The CFPB should demonstrate that these rules are insufficient before proposing any new rules.

CBAI urged the Bureau to not increase the regulatory burden on community banks and unequivocally ensure that any additional debt collection regulation not “trickle down” and be applied to community banks by their prudential regulators. Read Comment Letter


Illinois Members of Congress Call on Regulators to Address the Volcker Rule Impact on Community Banks

December 23, 2013

Illinois Senator Mark Kirk and Congressmen Peter Roskam, Randy Hultgren, and Bill Foster, have called on federal banking regulators to address the impact of certain provisions of the Volcker Rule that could create severe unintended consequences for hundreds of community banks. The provisions which were recently released could require many community banks to take unanticipated losses on their holdings of collateralized debt obligations (CDOs) backed by bank-issued trust preferred securities (TruPS).

Senator Mark Kirk (R-IL) joined with Senator Joe Manchin (D-W.VA) in stating, “The purpose of the Volcker Rule was to ensure that the trading activities of the big banks do not undermine the U.S. economy and financial stability, not to punish community banks.” They went on to explain that under the Rule, “These [community] banks would be required to recognize a write-off in the current quarter for any unrealized losses from holding these securities and would be required to liquidate the security by July of 2015. If the bank was able to hold these securities until maturity, the anticipated loss would be zero.” Kirk and Manchin urged the regulators to use their authority to grant a carve-out or grandfather status to banks under a certain asset size for their ownership of these securities.

Congressman Randy Hultgren (R-14) and Bill Foster (D-11), both members of the House Financial Services Committee, expressed their deep concern for the immediate consequences of the Volcker Rule on Illinois community banks which hold these securities. Chief Deputy Whip Peter Roskam (R-6) urged that, in the interests of Illinois community financial institutions, the regulators consider potential accommodations and alternatives. He also noted that, given the time sensitive nature of this issue, regulators should give consideration to this matter as soon as possible.

CBAI thanks Senator Kirk, and Congressmen Hultgren, Foster, and Roskam for writing the banking regulators on this important issue, and for their support for Illinois community banks.