STATE GOVERNMENT RELATIONS
Register for 2022 IBA Regional Meetings
Three regional meetings remain in Richmond, Bloomington and New Albany. The New Albany regional meeting has been rescheduled for Oct. 17. Be a part of the these meetings to facilitate grassroots communication between the bankers we serve and the legislators who serve our state. The meetings will 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 join bankers for lunch. Each meeting begins at 11:00 a.m. local time.
Richmond – August 29
Olde Richmond Inn
138 South 5th Street
Richmond, IN 47374
Bloomington – August 30
Graduate Hotel
210 East Kirkwood Avenue
Bloomington, IN 47408
New Albany (NEW DATE) – October 17
The Exchange Pub
118 W Main Street
New Albany, IN 47150
FEDERAL GOVERNMENT RELATIONS
SEC Adopts New Reporting Requirements for Executive Compensation
The Securities and Exchange Commission on Thursday adopted new requirements for company disclosures concerning executive compensation. Among the changes is a new requirement that a reporting company’s proxy statement and other disclosures include a table showing executive compensation and financial performance measures. Companies also must provide the annual total shareholder return and the annual total shareholder returns of a peer group of companies.
The SEC originally proposed the rule in 2015. It was never finalized, but the agency reopened comment earlier this year. Under the new rule, large companies would be required to disclose details on executive compensation for the past five fiscal years while small companies need to report on the past three fiscal years. Small companies would be exempt from disclosing details on pensions and peer groups. They also are exempt from new language requiring companies to list the three to seven most important measures linking executive compensation to company performance. Emerging growth companies, registered investment companies and foreign private issuers are not required to provide the disclosure.
Companies must begin to comply with the new disclosure requirements in proxy and information statements that are required to include Item 402 executive compensation disclosure for fiscal years ending on or after Dec. 16.
Trade Groups Oppose Proposed Increase in Deposit Insurance Assessments
The American Bankers Association, Independent Community Bankers of America and four other trade associations came out against a proposed two basis-point increase in deposit insurance assessment rates in comments submitted to the Federal Deposit Insurance Corp. last Friday, saying “such an aggressive assessment rate increase is unwarranted.”
The FDIC signaled in June its intent to raise rates starting during the first quarterly assessment period of 2023. The proposed increase ─ which would remain in effect until the Deposit Insurance Fund reserve ratio meets the FDIC’s long-term goal of 2% – would amount to a 54% increase in the current average assessment rate. The agency previously approved a DIF restoration plan to restore the reserve ratio to the statutory minimum of 1.35% in 2028, but a sustained increase in insured deposits due to the pandemic and major unrealized losses in its securities portfolio caused the reserve ratio to drop to 1.23% earlier this year.
In their letter, the associations indicated the analysis underpinning the proposed increase does not account for recent changes in deposit levels or interest rates. They also said the factors that caused the reserve ratio to fall and remain below its statutory minimum, and which the FDIC assumes will continue, will soon disappear. The groups added that the rate hike runs counter to what Congress intended when it adopted the legislative framework to raise rates, as lawmakers wanted to avoid the snap increases the agency is now proposing.
“Forgoing a procyclical increase, particularly when the DIF reserve ratio is projected to return to its statutory minimum without the need for any increases in assessments, will free up bank resources and better enable banks to maintain lending in support of economic activity during any economic downturn, thereby supporting the economy at large and, ultimately, the public,” the groups wrote.
Biden Announces Student Debt Forgiveness Plan
The Biden administration announced plans on Wednesday to provide up to $20,000 in student debt forgiveness and extended the federal student loan repayment moratorium, first implemented under the Trump administration, through Dec. 31.
The forgiveness applies to Americans earning under $125,000 per year, or $250,000 per year for married couples who file taxes jointly. Pell Grant recipients will receive up to $20,000 in debt forgiveness, and non-Pell Grant recipients will get up to $10,000 in debt relief.
Borrowers will also have the ability to opt into a repayment plan that caps payments at 5% of income. An estimated 43 million people are expected to receive some level of forgiveness, according to media reports.
SEC Releases Draft Strategic Plan for Fiscal Years 2022-26
The Securities and Exchange Commission on Wednesday released for public comment a draft strategic plan for fiscal years 2022 through 2026. The draft strategic plan establishes three primary goals:
- Protect Americans against fraud, manipulation, and misconduct;
- Develop and implement a robust regulatory framework to keep pace with evolving markets, business models and technologies; and
- Support a skilled workforce to help advance the agency’s objectives.