Pub. 1 2012 Issue 5

8 l e a d i n g a d v o c a t e f o r t h e b a n k i n g i n d u s t r y i n k a n s a s Federal Affairs Committee 2012 Pilgrimage to DC T here is no time like the present to get involved with advocacy for Kansas Banking. With the rapidly changing regulatory environment, it is important for stakeholders to take opportunities to influence decision- makers by helping them understand the impact of their decisions, thereby shaping the future of the industry. The KBAFederalAffairs Committee led the Bank Leaders of Kansas (BLOK) Class on the annual advocacy visit to Washington D.C. on June 17-19, 2012. The group first gathered at the ABA to hear updates on key issues at the federal level which included discussion on the farm bill, which was to be debated in the Senate the following day. There were numerous amendments and some growing concern regarding the caps that may be placed on crop insurance subsidies. The bill has since passed in the Senate without the amendment that limited crop insurance premium support to $40,000 per farmer. The bill has now moved to the HouseAgriculture Committee. TheABA is keeping an eye on discussion surrounding new regulations under fair lending policy which is focused on desperate impact. The credit union lending cap legislation still hasn’t come to a vote and it isn’t sched- uled to be debated on the floor at this point. Other items on the watch list include the Exam Relief Bill, overdraft programs, QM additions as required in Dodd-Frank legislation and Basel III capital standards information that was just released a week before the visit to the capital. Later in the day, Tom Hoenig, FDIC Vice Chair, and key staff members of the FDIC participated in discussions including questions regarding whether the TAG (TransactionAccount Guarantee) programwill continue and if so, what it will cost and if it will be optional. There were also numerous discussions on the fact there is no de minimus bank size listed in the new Basel III information released. There was no shortage of bankers to explain the negative impact these capital requirements would have on their community banks. Fair lending issues such as mortgage loan compliance and small loan exemptions were among the key issues shared with regulators in this meeting as well. The group started Tuesday morning with a meeting with manage- ment at the CFPB following the opening discussion withABA leadership. Bart Shapiro, Senior Advisor, welcomed the group and was followed by a brief presentation from Gary Stein, Deposits Markets ProgramManager. Stein explained that the Markets and Regulation department is not plan- ning to impose new regulations but rather looking at products and how they are used by consumers. He reiterated several times that his goal is to have his staff understand banking products as well as banks. Chuck Stones, KBA President, invited them to come see Kansas banks and the great relationship they share with their customers. There was a resound- ing concern from bankers that the actions from the CFPB will result in more regulation that will ultimately require fees to cover the cost. The discussion led to the example of the international wire transfer rules that banks cannot currently meet. If adopted, some banks will not be able to continue offering wire services. The request was made that banks have a venue to share stories with the CFPB to help them understand how their decisions affect banks. There is no formal process in place at this time. The final question from the KBA membership was to the point that the stated purpose of the CFPB was to provide supervision to non-bank institutions that provide financial services largely unregulated. At this time there are 830 people on staff at the CFPB of which 300 are examiners on the ground. They could not speak to the numbers that are looking at non-bank institutions at this time. A visit to the OCC featured Beverly Cole, Senior Advisor to the Senior Deputy Comptroller for Midsize and Community Bank Supervision, and Stuart Feldstein, Director for Legislative and Regulatory Activities. They opened their discussion with the statement that they are trying to implement the required changes under Dodd-Frank without making things too dif- ficult for community banks. The discussion revealed that the OCC considers a bank rating of 3, 4 or 5 a problem bank while the other regulators only place 4 and 5 into the problem bank ranking. The reason given for this is to focus on problems earlier in an attempt to make changes before it reaches a point where a turnaround is not possible. There was discussion on the number of banks converting from a federal to state charter. Several concerns were mentioned including the considerable cost difference and lack of anonymity in post survey feedback to the OCC’s Ombudsman’s office. The OCC staff re - minded everyone that they have a strong ombudsman process where you can share information that will be taken seriously when details are clear. Members of the Federal Affairs Committee shared their consid- erable gratitude with Senator Moran for sponsoring the Exam Relief Bill (SB 2160). They also thanked Senator Roberts for signing on as a co-sponsor of this legislation. The meeting with Congressman Yoder, Huelskamp, Pompeo and Congresswoman Jenkins met similar praises for co-sponsoring the Communities First Act. There is much work to be done but KBAunderstands the importance of legislative advocacy as a critical process in making our priorities heard. Kansas bankers are experts in our industry and we are engaged in the legislative process to support and assist Kansas banks and bankers. Special thanks to the KBA Federal Affairs Committee for your commit- ment and dedication to advocacy for Kansas banks. KBA understands the importance of legislative advocacy as a critical process in making our priorities heard.