STATE GOVERNMENT RELATIONS
Register Today for 2021 IBA Regional Meetings
Register today and join us for a series of regional meetings around the state. The IBA has implemented these meetings in an effort to facilitate grassroots communication between the bankers we serve and the legislators who serve our state. The meetings include an hour-long update on the IBA, including legislative information and advocacy opportunities. Following the update, local legislators from the Indiana General Assembly will meet for lunch with bankers from the community. This year, the IBA will be hosting 5 regional meetings, each beginning at 11:00 a.m. local time. Follow the links below for your preferred location and register today!
Columbus
Hotel Indigo Columbus Architectural Center
Tuesday, September 7
Click here to register
Indianapolis
The Columbia Club
Thursday, September 16
Click here to register
Fair Oaks
The Farmhouse Restaurant at Fair Oaks Farms
New Date! Monday, October 4
Click here to register
Evansville
The Bauerhaus
Tuesday, October 5
Click here to register
Fort Wayne
The Landmark Centre
New Date! Monday, October 25
Click here to register
FEDERAL GOVERNMENT RELATIONS
Survey: Debit Transactions Decline for First Time on Record
In response to the COVID-19 pandemic, the number of debit transactions declined 2.5% in 2020, the first dip in the 16-year history of the Pulse debit issuer survey released Tuesday. Debit transactions declined to 76.1 billion in 2020 from 78.1 billion in 2019.
While the number of transactions declined, the debit dollar volume increased 8% year-over-year. The average ticket size increased to $44.80 in 2020 from $40.50 the prior year, boosting debit volume to $3.4 trillion in 2020. “With many restaurants and retail locations closed for several months in 2020, generally people headed out less often which meant fewer debit purchases, but they stocked up when they did go out for groceries and other necessities,” said Tony Hayes of Oliver Wyman, which conducted the study for Pulse.
Spending patterns shifted as American stayed home, with card-not-present transactions rising 23% year-over-year. Of the top 10 merchant categories for debit purchases, bookstores, including Amazon, increased 57%, digital goods increased 41% and home supply retail increased 22%. Transportation dropped 53% and restaurants and bars declined 18%.
The rollout of contactless debit cards increased from 11% of all debit cards in 2019 to 30% in 2020. A third of cardholders with contactless cards said they used the capability.
Trade Groups Support Bill to Create Bipartisan Commission Structure for CFPB
In a recent letter to Rep. Blaine Luetkemeyer (R-Mo.), the American Bankers Association, Independent Community Bankers of America and several financial trade groups expressed support for H.R. 4773, the Consumer Financial Protection Commission Act, a bill that would transition the governance structure of the Consumer Financial Protection Bureau from having a sole director to a five-person, bipartisan commission. The bill is similar to bipartisan legislation introduced in previous Congresses and has long been supported by the financial services industry.
“A Senate-confirmed, bipartisan commission will provide a balanced and deliberative approach to supervision, regulation, and enforcement by encouraging input from all stakeholders. The current single director structure leads to uncertainty as administrations transition,” the groups indicated. “This uncertainty is not only borne by financial institutions providing significant lending services, but it negatively impacts America’s consumers, small businesses, and our local economies. Dramatic shifts in the CFPB’s philosophy and approach with each change in presidential administration make it difficult for lenders and small businesses to plan for the future.”
The groups added that transitioning to a bipartisan commission structure has wide support, with a Morning Consult poll showing that by a margin of three to one, registered voters in eight states support a bipartisan commission over a sole director. The poll also shows that only 14% or respondents stated they prefer to keep the bureau’s current leadership structure.
FHFA Proposes Changes to Fannie, Freddie Housing Goals
The Federal Housing Finance Agency on Wednesday proposed changes to Fannie Mae and Freddie Mac’s affordable housing goals for the 2022-2024 period. FHFA proposed to raise the goal for single-family home purchases by low-income families from 24% to 28% and the goal for very low-income families from 6% to 7%. The agency proposed to raise the goal for refinances by low-income families from 21% to 26%.
The proposal would also replace the existing low-income areas subgoal with two new area-based subgoals and corresponding benchmark levels. The first of the proposed subgoals would establish a benchmark level of 10% for GSE purchases of mortgage loans on properties in minority census tracts, made to borrowers with incomes no greater than 100% of area median income. The second of the proposed subgoals would establish a benchmark level of 4% for GSE purchases of mortgage loans on properties in low-income census tracts that are not minority census tracts, as well as mortgage loans on properties in low-income census tracts that are minority census tracts, made to families with incomes greater than 100% of AMI.
FHFA also proposed to raise both GSEs’ multifamily goals from 315,000 units to 415,000 units. Fannie and Freddie would each be required to target 88,000 units annually for very low-income families (up from the 2021 benchmark of 60,000 units) and 23,000 small multifamily units that are affordable to low-income families, up from the current 10,000-unit benchmark.
SBA: 340K Submissions to PPP Forgiveness Portal
The Small Business Administration reported that it has received more than 340,000 submissions to the Paycheck Protection Program’s Direct Borrower Forgiveness Portal since it launched Aug. 4. The portal allows borrowers with PPP loans of $150,000 or less to directly apply for forgiveness, which is designed to speed up the process. Lenders may opt into the portal and still need to review the borrower-submitted information on the PPP platform and make a forgiveness decision. The SBA said more than 1,230 PPP lenders, representing over 50% of outstanding loan forgiveness applications, have opted in. The SBA also announced upcoming webinars for interested borrowers, scheduled for 2:30pm Eastern on Thursday, Aug. 26, and Thursday, Sept. 2. The PPP closed to new loan applications in June, with funding exhausted.
New Report Details Unbanked, Underbanked Populations
Roughly 10% of U.S. adults lack a checking or savings account, and another 24% use alternative financial services despite having a traditional account, according to Morning Consult. The polling data break down the unbanked and underbanked populations by gender, income, generation, and race and ethnicity. The remaining 66% of U.S. adults have a bank or credit union account and have not used alternative financial services over the past year, Morning Consult reported. According to the report, half of unbanked adults said someone in their household has a checking or savings account, leaving 5% of reported households without access to a checking or savings account. When broken down by household, the data appears to track an October 2020 FDIC report that found 95% of U.S. households had a bank or credit union account in 2019 – the highest percentage since that survey was first conducted in 2009. The FDIC #GetBanked initiative offers consumers information and resources on the benefits of opening an account with an FDIC-insured bank.
Fed Officials Raise Stablecoin Concerns: Minutes
Federal Reserve officials recently expressed concerns with the stability of stablecoins and contrasted them with domestic banks’ significant holdings of high-quality liquid assets. According to the minutes of the July 27-28 Federal Open Market Committee meeting, participants said stablecoins appear to have “the same structural maturity and liquidity transformation vulnerabilities” as prime money funds but with less transparency and underdeveloped regulations. Participants also cited “the fragility and the general lack of transparency” associated with stablecoins, the importance of monitoring them closely, and the need to develop an appropriate regulatory framework to address their risks.