Independent Banker - January 2023 - 23

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Small business data. According
to a court filing in California, the
CFPB plans to issue a final rule
implementing Dodd-Frank Section
1071 small business (generally,
those with gross annual revenues
of less than $5 million) reporting
requirements by March 31, 2023.
It proposes to nearly double the
number of data points required to
be collected on small business loans,
including information about race
and demographics, and covers all
banks making more than 25 small
business loans annually. Finalization
is expected as early as 2023.
CRA. On May 5, 2022, the federal
bank regulators jointly released
a notice of proposed rulemaking
(NPR) to strengthen and modernize
the Community Reinvestment Act
(CRA) regulations. The proposal
would increase small bank asset
thresholds and create a new
framework for evaluating large and
intermediate banks. A final rule is
expected in 2023.
Cyber reporting. Cyber Incident
Reporting for Critical Infrastructure
Act of 2022 (CIRCIA) was passed in
2022. The law will require all critical
infrastructure entities to report
cyber incidents to Cybersecurity
and Infrastructure Security Agency
(CISA) within 72 hours from
the time the entity reasonably
believes the incident occurred and
ransomware payments to CISA
within 24 hours of payment. An NPR
is due in 2024 or before.
Data privacy. Comprehensive
data privacy laws remain a hot topic
for state legislatures, with a number
of states following California's lead
and passing their own version of
the California Consumer Privacy
Act. In 2022, the House Energy
and Commerce Committee passed
a national data privacy bill, but the
bill did not receive a vote on the
" Looking at the CFPB's regulatory agenda,
it is likely we will continue to see the
CFPB taking actions using novel tools, like
interpretive rules, advisory opinions and
circulars, rather than formal rule changes. "
-MICHAEL EMANCIPATOR, ICBA
House floor. Interest at the state
and national level is expected to
continue in 2023.
Climate-related risk. In the
past year, the OCC, FDIC and
Federal Reserve Board published
draft principles for climate-related
financial risk management for
large banks, and the SEC published
a proposed rule governing the
enhancement and standardization
of climate disclosures for investors.
The agencies are likely to take
steps to finalize these proposals in
2023. While much of the regulatory
climate-risk agenda remains
focused on the nation's largest
banks, ICBA continues to make
the community-bank perspective
heard by advocating that these
QUICK STAT
2%
The FDIC's long-term goal for the
reserve ratio of insured deposits
Source: FDIC
policies should not trickle down to
community banks.
Peer-to-peer fraud. This area
could evolve rapidly. According
to Rhonda R. Whitley, ICBA
vice president and regulatory
counsel, " At this time, the CFPB
has not initiated action; however,
it is possible that it could revise
Regulation E for banks' liability
for the fraudulent transactions due
to the nature and growing scale
of occurrences. "
It's important for community
banks to monitor all types of
regulatory communications.
" Looking at the CFPB's
regulatory agenda, it is likely we
will continue to see the CFPB
taking actions using novel tools,
like interpretive rules, advisory
opinions and circulars, rather
than formal rule changes, " advises
Michael Emancipator, ICBA vice
president and regulatory counsel.
In 2023, community banks
should stay engaged to adjust
program requirements to align
with regulatory expectations and
to take steps to strengthen the risk
governance framework.
Mary Thorson Wright is a writer
in Virginia.
independentbanker.org // 23
http://www.independentbanker.org
Independent Banker - January 2023

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