Independent Banker - December 2017 - 67

He notes, though, that by making
incremental revisions to the rules, the
CFPB presents a challenge to banks
to meet the deadline.
Tim Grooms, chief risk officer for
First State Bank, a $450 million-asset
community bank in Winchester, Ohio,
expected HMDA to be a priority in
2017, and his bank worked to implement
the changes before year-end.
" We will flow information from our
LOS [loan origination system] into the
core system, " Grooms says, " but we've
been challenged by our vendor's
ability to build systems in the face of
vaguely described requirements and
the CFPB's delay in acting on some
aspects of data collection, recording
and reporting. "
He cites the Freddie Mac and
Fannie Mae draft loan application
form as an example. The CFPB did
not approve the use of the form until
late September and prevented banks
from collecting certain information
before Jan. 1, 2018, or risk violations
of Regulation B. Delays in regulatory
approvals and absence of firm guidance
have hindered the bank's ability
to move forward on policies, procedures
and staff training.
In late 2016, Grooms projected
enhanced due diligence under the
Bank Secrecy Act (BSA) as an area
of focus for 2017. The US Treasury
Financial Crimes Enforcement
Network's (FinCEN) final beneficial
ownership rules, effective in
May 2018, are intended to further
strengthen customer due-diligence
requirements for financial institutions
that are subject to the requirements
of the Patriot Act.
First State Bank prepared to roll
out the procedures and training in
the fourth quarter of 2017 to allow
retail staff time to respond to questions
and issues that may arise prior
to the mandatory implementation
date. After researching whether the
deposit account opening platform
or another source would work best
to capture the information, Grooms
and his team decided to use the BSA
monitoring system and then flow the
data into the core system.
Compliance management
Compliance management requires
ongoing attention to meet both the
needs of the bank and the shifting
array of requirements. Grooms
rebuilt First State Bank's compliance
management process in 2017 and
reassigned compliance responsibilities
within his group. The community
bank reallocated compliance work
among its analysts so each now
focuses on a narrower group of
regulatory issues, allowing more
specialization and deeper dives into
compliance management.
" Our compliance committee used
to meet quarterly or on an as-needed
" Our compliance
committee used to
meet quarterly or on an
as-needed basis, but
we now meet monthly
to stay abreast of and
be involved in all of the
regulatory changes,
policy revisions,
compliance monitoring
and risk assessments. "
-KRYSTAL GASKILL, NORTH
VALLEY BANK
Compliance calendar
A quick look at upcoming regulatory changes
Jan. 1, 2018
Effective date for final rule implementing
changes to the Home
Mortgage Disclosure Act (HMDA)
April 1, 2018
Effective date for final rule implementing
requirements for prepaid
accounts (Regulation E)
April 1, 2018
Effective date for Mortgage
Servicing Amendment (Regulations
X and Z and FDCPA)
May 11, 2018
Effective date for customer duediligence
requirements (beneficial
owner rule)
July 1, 2018
Effective date for final rule amending
Regulation CC
For compliance deadlines
further into the future, you can
see ICBA's online regulatory
calendar at icba.org/compliance/
regulatory-calendar
independentbanker.org
ICBA Independent Banker 63
http://www.icba.org/compliance/ http://www.independentbanker.org
Independent Banker - December 2017

Table of Contents for the Digital Edition of Independent Banker - December 2017
