Compliance Monthly is intended to keep you informed of regulatory changes in advance of their effective date so your institution can have the necessary policies, procedures and processes in place to be compliant at the time of enactment.
December Compliance Monthly Newsletter
New Rating System for Large Financial Institutions
The Federal Reserve finalized a new supervisory rating scale for large bank holding companies to better align the ratings system with its existing supervisory program. The new rating system will apply to all domestic bank holding companies and non-insurance, non-commercial savings and loan holding companies with $100 billion or more in total consolidated assets, which is a change from the $50 billion threshold originally proposed. The new rating system will also apply to U.S. intermediate holding companies of foreign banking organizations with $50 billion or more in total consolidated assets. The new scale assigns ratings for capital planning, liquidity risk management and governance and controls. Banks will be assigned ratings in each category, rather than receiving a standalone composite rating, and each category must be highly rated for the bank holding company to be considered “well-managed.” The rule is effective February 1, 2019.
DownloadNovember Compliance Monthly Newsletter
Agencies Provide CIP Relief for Premium Finance Loans
On September 28, 2018, FinCEN and the Federal Reserve Board, FDIC, NCUA, and OCC have jointly issued an order granting an exemption from customer identification program requirements for premium finance loans. The exempted transactions are extended by banks and Credit Unions and their subsidiaries to commercial customers to facilitate purchases of property and casualty insurance policies (premium finance loans or premium finance lending).
DownloadOctober Compliance Monthly Newsletter
Permanent Relief from Beneficial Ownership Rule for Certain Transactions
FinCEN issued a ruling (FIN-2018-R003) granting permanent exceptive relief from Beneficial Ownership requirements for legal entity customers for certain account rollovers, renewals, modifications and extensions. The permanent relief broadens the scope of relief provided by the temporary ruling, but maintains strict definitional limits on which accounts are affected. Financial institutions will continue to be required to identify and verify the identity of beneficial owners of legal entity customers at the initial account opening of all accounts (including those affected by the exceptive relief) occurring on or after May 11, 2018. The exceptive relief applies to:
- A rollover of a certificate of deposit that does not allow additional deposits during its term;
- A renewal, modification, or extension of a loan (e.g., setting a later payoff date) that does not require underwriting review and approval;
- A renewal, modification, or extension of a commercial line of credit or credit card account (e.g., a later payoff date is set) that does not require underwriting review and approval; and
- A renewal of a safe deposit box rental.
September Compliance Monthly Newsletter
CFPB Clarifies HMDA Partial Exemptions
The CFPB issued an interpretive rule clarifying several changes to Home Mortgage Disclosure Act regulations made under S. 2155, the bipartisan regulatory reform law. The rule is intended to address concerns raised by banks about S. 2155’s partial exemptions for certain financial institutions from reporting an expanded set of HMDA data points. The CFPB also published an executive summary on the rule and updated the Filing Instructions Guide for HMDA data collected in 2018 and the Regulatory and Reporting Overview Reference Chart. The rule will be effective upon publication in the Federal Register.
DownloadAugust Compliance Monthly Newsletter
Mandated stress tests under the Dodd-Frank Act have ended for banks and bank holding companies (BHCs) with less than $100 billion in assets. As required by the regulatory reform law S. 2155 that was enacted in May, BHCs with less than $100 billion were immediately exempted from company-run stress tests and other enhanced prudential standards, but not banks.
DownloadJuly Compliance Monthly Newsletter
NCUA Adjusts Member Business Lending Rule In one of the first regulatory changes implementing the Economic Growth, Regulatory Relief, and Consumer Protection Act (P. Law 115-174), the NCUA Board
has approved a change to its Member Business Lending rule that removes the member’s occupancy requirement for loans secured by liens on 1-to-4-unit family dwellings. The member business lending rule previously required those dwellings to be the primary residence of a member in order to be excluded from limitations on member business loans. The rule is effective June 5, 2018.
June Compliance Monthly Newsletter
FinCEN Temporarily Delays Beneficial Ownership Requirements for Rollovers & Automatic Renewals and Grants Relief for Premium Finance Cash Refunds FinCEN announced a temporarily suspension of the application of the beneficial ownership requirements for certificate of deposit rollovers and loans that renew automatically. The relief is retroactive to the May 11 compliance date and will
continue until August 9, 2018. During that time, FinCEN will re-evaluate the requirement to determine if more permanent relief is needed.
May Compliance Monthly Newsletter
Agencies Finalize Rule Raising CRE Appraisal Threshold The Federal Reserve, FDIC and the OCC approved a final rule raising the required appraisal thresholds for commercial real estate transactions from $250,000 to $500,000. This represents an increase from the original proposal, which called for the appraisal threshold to be raised to $400,000. Under the final rule, the threshold for loans secured by one-to-four family residential properties will remain at $250,000; however, residential construction loans secured by multiple one-to-four residential properties would be considered CRE transactions.
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CFPB Adjusts Mortgage Servicing Rule for Borrowers Facing Bankruptcy
The CFPB issued a final rule to help mortgage servicers communicate with certain borrowers facing bankruptcy. The rule gives mortgage servicers more latitude in providing periodic statements to consumers entering or exiting bankruptcy, as required by the CFPB’s 2016 mortgage servicing rule. The rule will become effective April 19, 2018, along with other servicing rule amendments affecting consumers in bankruptcy and successors in interest that go into effect that day.
March Compliance Monthly Newsletter
FinCEN is updating the Suspicious Activity Report (SAR) filing format, which goes live in June 2018. Beginning with the new SAR filings, batch submissions will have to be made in an XML-based file, rather than in the current ASCII fixed-length delimited file format.
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