Regulatory Compliance Update

By: Hickman Beckner, Vice President

It has been a very quiet month for regulatory affairs.

The only significant regulatory action was a new rule proposed by the FDIC to speed up the determination of coverage for deposits when a large bank fails. The rule is intended to pay depositors as quickly as possible with minimal cost to the deposit insurance fund.

The new rule mandates that the deposit system of a covered institution must be able to calculate the amount of deposit insurance coverage available to each account. A covered institution is defined as an insured depository institution with more than 2 million deposit accounts. The rule also mandates that an ownership code be assigned to each account.

This new rule does not impact loans, leases, collections or recovery systems.

Significant Dates:

June 27, 2016 – Comments due on the FDIC’s proposed rule that would facilitate prompt payment of insured deposits when banks fail.

July 1, 2016 – Effective date for the IRS temporary regulations that remove the automatic extension of the deadline for filing form W-2.

September 23, 2016 – Effective date for Phase 1 of NACHA’s same-day ACH processing. Phase 1 covers deposits only.

October 3, 2016 – Mandatory compliance date for the Department of Defense final rule implementing the Military Lending Act for active duty service members and their dependents.

Emerging Legislation:

Some new bills have been introduced in Congress that will impact financial institutions:

Senior Safe Act would create a “safe harbor” for personnel that have received training in identifying and reporting the suspected exploitation of a senior citizen when they report a suspected case to a covered agency.

Financial Institution Customer Protection Act would end Operation Choke Point.