Independent Banker - February 2019 - 9

FROM THE TOP
" This law is welcome news
for qualifying community
banks, and it's due
exclusively to our industry's
grassroots outreach. "
Tim Zimmerman
Chairman, ICBA
Tim Zimmerman is CEO of
Standard Bank, Monroeville, Pa.
Community bankers know that hard work
pays off, but sometimes not right away. For
instance, take a recent bit of good news for community
banks that has been years in the making.
The FDIC recently alerted community banks
with assets under $10 billion of their share in
approximately $750 million in deposit-insurance
assessment credits because the Deposit Insurance
Fund (DIF) reserve ratio surpassed 1.35
percent. These banks are eligible for credits due
to a 2016 agency rule implementing an ICBA-advocated
provision dating all the way back to the
Dodd-Frank Act of 2010.
That law requires the FDIC to offset the cost
of increasing the reserve ratio from 1.15 percent
to 1.35 percent on institutions with less than
$10 billion in assets. Under the agency's final
rule, these community banks can redeem their
credits once the DIF reserve ratio reaches 1.38
percent, hence the messages from the FDIC to
community bankers across the nation last month
on their share.
This is certainly welcome news for qualifying
community banks across the country, and it's due
exclusively to our industry's grassroots outreach.
We were the only ones who advocated the change
as part of long-sought deposit-insurance reforms,
and we did so with the long term in mind.
At the time of the original debate, the DIF was
Did you
know?
After reaching a
low of negative
$20.9 billion
in the third
quarter of 2009,
the Deposit
Insurance Fund
balance now
stands at
$100.2 billion.
in negative territory amid the fallout of the Wall
Street financial crisis. Looking at the big picture,
ICBA and community banks fought hard
to ensure Main Street institutions wouldn't be
stuck footing the cost of the higher reserve ratio.
It's been years in the making, but the industry is
finally reaping the benefits of that success.
This is nothing new for community bankers-
we are used to years-long fights for policy gains.
Consider many of the provisions of last year's
S.2155 relief law, such as relief from qualified
mortgage, Home Mortgage Disclosure Act and
appraisal requirements, which played out over
multiple Congresses. Our campaigns to simplify
the call report and regulatory capital rules
remain unfinished.
With many advocacy initiatives ahead of us
in 2019, we will all need to keep engaged and
work hard to wage these battles with the knowledge
that we can ultimately achieve success. We
are faced with new challenges and threats to our
franchises almost daily. I appreciate your service
and dedication, and I look forward to working
with you to ensure a bright future for community
banks!
Connect with Tim @TimZimPgh
independentbanker.org Q 9
http://www.independentbanker.org
Independent Banker - February 2019

Table of Contents for the Digital Edition of Independent Banker - February 2019
