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February 3, 2006

FDIC Reform Enacted
After many years of work, Congress this week passed the Federal Deposit Insurance Reform Act of 2005 as part of the Deficit Reduction Act of 2005 and sent to the President for signature.  The final bill:

• Deals with the issue of premium payments by fast-growing institutions that have not made premium payments reflecting that growth under the current system;

• Provides for a cap on the growth of the insurance fund, with appropriate dividend payments when the fund is at high levels;

• Formally recognizes the interest that individual banks have in the fund based on their payments into it (the language in both bills on this point needs strengthening to be effective);

• Eliminates the so-called 23¢ cliff, which would require major premiums to be paid at a time when such action could undermine an economic recovery;

• Merges the BIF and SAIF; and

• Importantly, provides for mechanisms to address the ongoing impact on the insurance level from inflation, as well as providing additional coverage for retirement accounts.

Please click here for a Summary of FDIRA prepared by the American Bankers Association.

Greenspan Questions Wal-Mart ILC Expansion
In one of his last acts as outgoing chairman of the Federal Reserve Board, Chairman Alan Greenspan urged Congress to “review the ILC [industrial loan company] exemption.”  You will recall from previous Bulletins that GBA has also questioned the public policy implications of granting Wal-Mart an Industrial Loan Company license, and apparently Mr. Greenspan agrees.  “This special exemption allows any type of company, including a commercial firm or foreign bank, to acquire an ILC in a handful of states (primarily in Utah, California and Nevada) and avoid the consolidated supervisory requirements and activity restrictions that apply to corporate owners of other types of insured banks under the federal Bank Holding Company Act.”  His comments were made in a letter to former House Financial Services Committee Chairman, Rep. James Leach (R-IA) who has been leading the calls for an inquiry.

Read This Week's e-Legislative Update
Follow this link to read this week's e-Legislative Update.  Among the major banking issues at the State Capitol covered in today's edition  are:

• ATM Bill Introduced Mandating Emergency 911 Buttons on All Machines

• Banking Committee Hears File Freeze Bill

• Digital Signature Bill Passes Senate

• Banking Commissioner Testifies on Emergency Preparedness

With questions, please call GBA's Elizabeth Chandler at (404) 420-2027.

Call Report Requirements Changing
CEOs and CFOs should pay special attention to an announcement from the Federal Financial Institutions Examination Council (FFIEC) that changes to Call Report filings will be phased in over the next two years.  Of immediate interest are the changes which will be made with the March 31, 2006 Call Reports:  eliminating for some or all banks existing items for estimated uninsured deposits, asset-backed securities held as investments, income from non-trading derivatives, and bankers acceptances; adding items for life insurance assets, types of credit derivatives, remaining maturities of credit derivatives, and certain foreclosed properties; and revising the reporting of income from international operations.  Click here to see more about the changes.

Early Registrations Flying in For Two Upcoming Major Events
We are delighted with the large number of registrations we have already received for two of our major conferences coming up next month.  The annual Financial Risk Management Conference slated for March 2-3 in Atlanta and sponsored by the Asset/Liability Management Committee, provides current information on issues related to Asset and Liability management including financial controls, investment of bank funds, interest rate risk management and related financial matters.  The Financial Risk Management Conference has a history of providing outstanding speakers and timely topics related to the asset/liability arena. Click here for a complete agenda and information about the pre-Conference Workshops or for online registration.  The Operations/Technology Conference sponsored by GBA's Operations/Technology Committee is designed to address issues pertinent to those areas of your bank.  Topics at their conference planned for March 1-17 in Atlanta include:  Bank Technology Trends; Intrusion Detection Systems and Penetration Testing; Financial Management in 2006; Cost Analysis of Remote Deposit; Risk Assessment and the Role of the IS Officer; Business Continuity Planning and others.  Click here for a conference agenda or to register online.  With questions, please call GBA's Marybeth Jones at (404) 420-2032.

Register Today for AIB Online Courses
Just a reminder that the following AIB online classes begin on February 27.  Please register no later than two weeks ahead of time to secure a seat in the class. 

• ABA Online Review Course for the CTFA Exam (open enrollment), 12 wks, $750

• Analyzing Financial Statements, 16 wks, $475

• Banking Today, 5 wks, $275

• Commercial Lending, 16 wks, $375

• General Accounting, 16 wks, $475

• Principles of Banking, 16 wks, $375

• Today's Teller: Developing Basic Skills (open enrollment), 8 wks, $275

These courses are instructor-facilitated with weekly assignments.  They can be taken from the comfort of your home or the convenience of your office. All you need is a computer, printer and Internet access.  With questions, please call GBA’s Fran Williams at (404) 420-2015.

ABA Online Review Course for the CRCM Examination
AIB’s ABA Online Review Course for the CRCM Exam begins February 13. This eight-week online course is designed for Compliance Managers, Department Managers and Staff, Product Managers, and Retail/Branch Banking Managers, and ideally for those preparing for the CRCM Exam. Each week, you will read one section from the manual and complete quizzes to test your knowledge. There will be a discussion board for each week’s assignments so you can ask questions from a qualified mentor as well as review and discuss other student’s questions and comments. This course is instructor-facilitated with weekly assignments. For more information or to register, please call GBA’s Fran Williams at (404) 420-2015.

Delta's Credit Union CU Adds Two Counties to Field of Membership
Delta Community Credit Union has received approval to serve residents of Fayette and Henry counties. The credit union is also moving forward with its goal of building more branches having just opened a full-service center in Fayetteville. Another branch in Peachtree City is slated to open later this year. Two more branches are currently under construction in Henry County and are scheduled to open in late spring.   The credit union's application to convert to a community charter was approved several months ago to serve anyone who lived, worked or worshiped in Clayton County.