Welcome to New ICBA NewsWatch Today®
Welcome to the new-look ICBA NewsWatch Today. ICBA launched the new version of its morning rundown on the community banking industry to make it easier for community bankers to get the morning buzz.

Under the new setup, community bankers will receive a short email preview of the day’s news from ICBA. To read more, click through to the ICBA NewsWatch Today landing page for a more detailed look and additional Web resources. ICBA NewsWatch Today will focus exclusively on news and information relevant to community bankers.

ICBA’s new, consolidated model also will be easier on your inbox. ICBA NewsWatch Today will run Monday-Thursday instead of every day. Filling in on Fridays will be ICBA Member Access, ICBA’s now-weekly newsletter focused on educational events and profit-enhancing products and services.

The new format will reduce the number of emails that ICBA members receive, consolidate the association’s member communications, better target the news and information you wish to receive, and improve the newsletters’ deliverability and mobile capability.

Fitch: TAG Expiration Would Benefit Megabanks
Allowing full FDIC coverage of noninterest-bearing transaction accounts to expire may negatively affect community banks and benefit too-big-to-fail institutions, Fitch Ratings said. The rating agency said that larger institutions are likely to be beneficiaries if the Transaction Account Guarantee coverage expires as scheduled on Dec. 31. ICBA has led the push for a temporary extension of the coverage.

ICBA continues working with lawmakers to procure an extension of this important deposit coverage. The association encourages community bankers to continue expressing their support for extending the program by calling and writing their members of Congress. Call Congress Today. Write Congress Now.

Credit Unions
NCUA Expands Biz-Loan Authority for Business Vehicles
The National Credit Union Administration released a legal opinion granting credit unions increased member-business-lending authority related to business vehicles. The opinion revises the definition of “fleet” from two or more vehicles used to deliver a product or service integral to business to five or more vehicles that are centrally controlled and used for a business purpose.

Existing rules require member business loans to meet certain collateral and security requirements. The maximum loan-to-value ratio, for example, cannot exceed 80 percent unless the excess is covered by insurance or a similar guarantee. Credit unions can make business vehicle loans without complying with that loan-to-value requirement except in the case of “fleet” vehicles because these vehicles tend to depreciate more quickly than non-business vehicles and therefore pose a higher risk to the lender.

By updating the “fleet” definition, NCUA is giving credit unions greater flexibility in making lending decisions. A credit union that loans to a member business with fewer than five vehicles would qualify for the loan-to-value exception.

ICBA Panel Meets with Top Regulators
The ICBA Regulation Review Committee met in Washington this week and held a series of meetings with regulators on top issues facing the industry. Committee members met with Consumer Financial Protection Bureau Director Richard Cordray, FDIC Director Thomas Hoenig, Comptroller of the Currency Thomas Curry, Federal Reserve Governor Elizabeth Duke and staff on issues such as Basel III regulatory capital standards and pending mortgage regulations.

The committee conveyed a strong message that community banks should be exempt from Basel III, that the proposed new risk-weight system for mortgages should be changed and that AOCI should not be included as regulatory capital. Committee members also expressed their strong concerns about future rulemaking concerning mortgages.

HMDA Reporting Continues Downward Trend
The number of financial institutions reporting Home Mortgage Disclosure Act data declined 4 percent in 2011 from the previous year, according to the Federal Financial Institutions Examination Council. The FFIEC released data on mortgage lending transactions at 7,632 U.S. financial institutions, continuing a downward trend since 2006, when HMDA covered more than 8,900 lenders. The FFIEC said the decline reflects mergers, acquisitions and failures.

The 2011 data include information on 11.7 million home loan applications and 2.9 million loan purchases for a total of nearly 14.7 million actions. The data also include information on 186,000 requests for preapprovals related to a home purchase that did not result in a loan. The total number of originated loans fell by 10 percent from 2010, in part because of a 13 percent decline in refinancings. Home purchase lending also fell, by 5 percent

OCC Issues Bulletin on Investor-Owned Real Estate
The Office of the Comptroller of the Currency released guidance for national banks and thrifts on appropriate credit risk management practices for investor-owned residential real estate lending in which the primary repayment source for the loan is rental income.

The OCC said this type of lending has increased, though it presents credit risks similar to loans for income-producing commercial real estate. Because of this similarity, the OCC said it expects banks to use the same types of credit risk management practices for IORR lending that they use for CRE lending. Read the OCC Bulletin.

Builder Confidence Improves in September
Builder confidence in the market for newly built, single-family homes rose in September for a fifth consecutive month, according to the National Association of Home Builders. The NAHB Housing Market Index rose three points to 40, its highest reading since June 2006. The HMI components gauging current sales conditions, sales prospects in the next six months and traffic of prospective buyers all rose.

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