Regulatory Spotlight

are registered under the Securities Exchange Act. The amendments require additional detail regarding the structure of an issuer’s repurchase program and its share repurchases, require the filing of daily quantitative repurchase data either quarterly or semi-annually, and eliminate the requirement to file monthly repurchase data in an issuer’s periodic reports. The amendments also revise and expand the existing periodic disclosure requirements about repurchases. Finally, the amendments add new quarterly disclosure in certain periodic reports related to an issuer’s adoption and termination of certain trading arrangements. The final rule is effective 07/31/2023. The final rule may be viewed at: https://www.govinfo.gov/content/pkg/FR-2023-06-01/pdf/2023-09965.pdf. Federal Register, Vol. 88, No. 105, 06/01/2023, 36002-36063.

SEC Issues Proposed Rule to Amend Covered Clearing Agency Resilience, Recovery, and WindDown Plans.

SEC issued a proposed rule to amend certain portions of the Covered Clearing Agency Standards under the Securities Exchange Act to strengthen existing rules regarding margin with respect to intraday margin and the use of substantive inputs to a covered clearing agency’s risk-based margin system. SEC has also proposed a new rule to establish requirements for the contents of a covered clearing agency’s recovery and wind-down plan. Comments are due 07/17/2023. The proposed rule may be viewed at https://www.govinfo.gov/content/pkg/FR-2023-05-30/pdf/202310889.pdf Federal Register, Vol. 88, No. 103, 05/30/2023, 34708-34743.

FASB Seeks Comment on Leases Implementation Guidance Updates.

The Federal Accounting Standards Advisory Board (FASB) announced the release of an exposure draft technical release titled, Leases Implementation Guidance Updates. The release may be found on the FASB website. FASB seeks comment on any part of the exposure draft. Comments are due 06/30/2023. The notice may be viewed at: https://www.govinfo. gov/content/pkg/FR-2023-06-05/pdf/2023-11836.pdf Federal Register, Vol. 88, No. 107, 06/05/2023, 36578.

VA Seeks Comment on Status of Loan Account Information Collection.

The Department of Veterans Affairs (VA) seeks comment regarding an information collection titled, Status of Loan Account, Foreclosure or Other Liquidation, VA Form 26-0971. VA Form 26-0971 is used when the holder of a delinquent vendee account is legally entitled to repurchase the loan by VA when the loan has been continuously in default for three months and the amount of the delinquency equals or exceeds the sum of two monthly installments. Comments are due within 30 days of publication of the notice. The notice may be viewed at: https://www.govinfo.gov/content/pkg/FR-202305-18/pdf/2023-10601.pdf Federal Register, Vol. 88, No. 96, 05/18/2023, 31854.

VA Seeks Comment on Statement Assuming Seller’s Loan Information Collection.

VA seeks comment regarding an information collection titled, Statement of Purchaser or Owner Assuming Seller’s Loan, VA Form 26-6382. Title 38, U.S.C., section 3702, authorizes collection of the information to help determine the release of liability and substitution of entitlement. Comments are due within 30 days of publication of the notice. The notice may be viewed at: https://www.govinfo.gov/content/pkg/FR-2023-05-18/pdf/2023-10597.pdf. Federal Register, Vol. 88, No. 96, 05/18/2023, 31854.

CDFI Amends Deadlines for Bank Enterprise Award Program Applications.

The Community Development Financial Institutions (CDFI) Fund issued a notice to amend five deadlines contained in the notice of funds availability (NOFA) for the Bank Enterprise Award Program (BEA Program). On 04/03/2023, CDFI Fund published a NOFA in the Federal Register for grants under BEA Program pursuant to the Consolidated Appropriations Act, 2023. The amended deadlines are listed in Table A within the notice. The notice may be viewed at: https://www.govinfo.gov/content/pkg/FR-2023-05-19/pdf/2023-10767.pdf Federal Register, Vol. 88, No. 97, 05/19/2023, 32277-32278.

Regulatory Spotlight

Presidential Proclamation Revokes Air Travel COVID-19 Vaccination Requirement.

President Biden issued a proclamation to revoke the air travel COVID-19 vaccination requirement. The proclamation states the finding that, except as provided in any other applicable proclamation, the unrestricted entry of persons described in section 2 of Proclamation 10294 is no longer detrimental to the interests of the United States. Therefore, the air travel COVID-19 vaccination requirement has been revoked. The proclamation is effective 05/12/2023. The proclamation may be viewed at: https://www.govinfo.gov/content/pkg/FR-2023-05-15/pdf/2023-10406.pdf. Federal Register, Vol. 88, No. 91, 05/15/2023, 30889-30890.

NCUA Issues Proposed Rule on Charitable Donation Accounts.

The National Credit Union Administration (NCUA) issued a proposed rule to amend the charitable donation accounts (CDA) section of NCUA’s incidental powers regulation to add “war veterans’ organizations,” (veterans’ organizations) as defined under section 501(c)(19) of the Internal Revenue Code, to the definition of a “qualified charity” that a federal credit union may contribute to using a CDA. NCUA is also asking if there are other groups, entities, or organizations NCUA should consider adding to the definition of a “qualified charity” to inform potential future rulemaking. Comments are due 07/31/2023. The proposed rule may be viewed at: https://www.govinfo.gov/content/pkg/FR-2023-05-31/ pdf/2023-11556.pdf Federal Register, Vol. 88, No. 104, 05/31/2023, 34792-34794.

Compliance Notes

DFI announced the release of a remote online notarization rule. The rule, DFI-CCS 25, relates to notaries public and notarial acts. The administrative rule helps DFI implement 2019 Wisconsin Act 125, which revised Wisconsin law governing notaries and notarial acts and authorized notaries public to perform notarial acts for remotely located individuals using approved technologies. The release may be viewed at: https://dfi.wi.gov/Pages/About/NewsEvents/ NewsReleases/20230524RemoteOnlineNotarizationRules.aspx

OCC issued an updated “Liquidity” booklet of the Comptroller’s Handbook. The booklet provides guidance on assessing the quantity of a bank’s liquidity risk and quality of liquidity risk management. The booklet applies to OCC’s supervision of national banks and federal savings associations. The booklet may be viewed at: https://occ.gov/newsissuances/bulletins/2023/bulletin-2023-15.html

OCC also updated its Policies and Procedures Manual (PPM) for bank enforcement actions and related matters. The revised version of PPM 5310-3 replaces the version issued 11/13/2018. PPM 5310-3 now includes Appendix C: Actions Against Banks With Persistent Weaknesses. The new appendix discusses (1) persistent weakness a bank may exhibit warranting further action(s) by OCC against the bank, and (2) the types of actions, requirements, and restrictions that may be appropriate to address a bank’s persistent weaknesses. The updated PPM may be viewed at: https://occ.gov/ news-issuances/bulletins/2023/bulletin-2023-16.html

CFPB issued notice to consumers after finding that billions of dollars stored on popular payment apps such as PayPal, Venmo, and Cash App may lack federal insurance. CFPB recommends consumers transfer balances to insured banks. The notice may be viewed at: www.consumerfinance.gov/about-us/newsroom/cfpb-finds-billions-of-dollarsstored-on-popular-payment-apps-may-lack-federal-insurance/

FDIC updated its RMS Manual to add a new Section 21.2 Supervisory Planning, Continuous Examinations section. The new section provides planning instructions for continuous examinations which is the process FDIC uses to perform full-scope examinations over the course of a year for certain institutions that are larger, more complex, or present a higher risk profile. The updated manual may be viewed at: www.fdic.gov/regulations/safety/manual/

The Federal Reserve’s FedCash® Services released a report from its ongoing research into the payment habits of the U.S. population. The findings reflect that consumer payment behavior remains consistent with the early pandemic, including a shift towards credit card payments and a slight decrease in the share of cash-based transactions. The

Compliance Notes

average amount of cash held in adults’ pocket, purse, or wallet rose to $73, reflecting a recent trend of higher consumer interest in holding cash. The report may be viewed at: www.frbservices.org/news/press-releases/051923-consumerpayment-survey-continued-pandemic-trends

HUD announced a reduction in both the Upfront Loan Guarantee Fee and the Annual Loan Guarantee Fee charge to homebuyers who obtain a Section 184 Indian Home (Section 184) Loan. The Upfront Loan Guarantee fee will be reduced from 1.50 percent to 1.00 percent and the Annual Loan Guarantee fee will be reduced from 0.25 percent to 0.00 percent for homebuyers seeking a Section 184 guaranteed loan. In addition to providing savings to borrowers, the lower fees can help more people qualify for a mortgage. As a result of the fee reductions, a Section 184 borrower purchasing a $194,000 home will save approximately $500 this year and up to $6,800 over the term of the loan. Overall, the reduction could mean a savings of $1.5 million for an estimated 3,000 Native American families in the first year alone. The fee reductions apply to all new Section 184 guaranteed loans effective 07/01/2023. The fee reductions will not apply to Section 184 guaranteed loans closed prior to the effective date. The announcement and Dear Lender Letter 2023-05, which provides implementation guidance to lenders, may be viewed at: www.hud.gov/press/press_releases_ media_advisories/HUD_No_23_113

OCC will host credit and operational risk workshops in Minneapolis July 18-19 for directors, senior management, and other key executives of national community banks and federal savings associations. The credit risk workshop covers the roles of board and management, credit risk within the loan portfolio, and how to stay informed of changes in credit risk. The operational risk workshop covers key risk management processes, oversight roles and governance responsibilities, fraud, risk-based audit programs, third-party vendor oversight, establishing a strong ethical culture, and regulatory expectations to address cyber threats. The announcement may be viewed at: https://occ.gov/news-issuances/ news-releases/2023/nr-occ-2023-59.html

FRB Chicago released AGLetter, No. 2000, May 2023 which provides an overview of agricultural credits for the Chicago District during first quarter of 2023. The letter may be viewed at: www.chicagofed.org/publications/ agletter/2020-2024/may-2023

CFPB released an issue spotlight on the expansive adoption and use of AI chatbots by financial institutions. CFPB found that poorly deployed chatbots can impede customers from resolving problems and cause customer frustration. The spotlight outlines several risks for financial institutions related to the use of chatbots, including: (a) noncompliance with federal consumer financial protection laws; (b) diminished customer service and trust; and (c) harm to consumers when inaccurate information regarding a consumer financial product or service was given. The spotlight may be viewed at: www.consumerfinance.gov/about-us/newsroom/cfpb-issue-spotlight-analyzes-artificial-intelligencechatbots-in-banking/

FDIC released its First Quarter 2023 Quarterly Banking Profile. Reports from 4,672 commercial banks and savings institutions insured by FDIC reflect aggregate net income of $79.8 billion in first quarter 2023. Though firstquarter net income increased by $11.5 billion (16.9 percent) from fourth quarter 2022, after excluding the effects on acquirers’ incomes of their acquisition of two failed banks, quarter-over-quarter net income would have been roughly flat. Strong growth in noninterest income, reflecting the accounting treatment of the acquisition of two failed institutions and record-high trading revenue at large banks, outpaced lower net interest income and higher noninterest expense. The profile may be viewed at: www.fdic.gov/news/press-releases/2023/pr23043.html

FRB issued the Economic Well-Being of U.S. Households in 2022 report, which examines the financial lives of U.S. adults and their families. Overall, the report shows that higher prices have negatively affected most households and overall financial well-being declined over the prior year, though workers continued to benefit from a strong labor market. The report may be viewed at: www.federalreserve.gov/newsevents/pressreleases/other20230522a.htm

FHA has made available in Chinese, Korean, Spanish, Tagalog, and Vietnamese more than 30 single-family mortgage documents and resources used in origination of FHA-insured mortgages. The educational resources are accessible from FHA’s new language access web page and are intended to assist lenders, servicers, housing counselors, and other FHA-program participants in explaining information related to FHA-insured mortgages to those with limited English proficiency prior to borrowers executing legal documents in English, as required by law. A list of the mortgage documents and information resources available may be viewed at: www.hud.gov/press/press_releases_media_advisories/ HUD_No_23_115

Compliance Notes

Federal bank regulatory agencies issued host state loan-to-deposit ratios. The ratios are used to evaluate compliance with section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act. The ratios replace those from June 2022. By law, a bank is generally prohibited from establishing or acquiring branches outside of its home state primarily for the purpose of acquiring additional deposits. The prohibition seeks to ensure that interstate bank branches will not take deposits from a community without the bank also reasonably helping to meet the credit needs of that community. The ratios may be viewed at: www.occ.gov/news-issuances/news-releases/2023/nr-ia-2023-47a.pdf

Treasury and VA urge veterans to redeem matured savings bonds. Veterans (and other citizens) hold nearly $40 billion in savings bonds that no longer earn interest and should be reeded. The agencies reminded veterans that they may be owed money from matured savings bonds. Veterans may have purchased savings bonds through a payroll savings program while serving in the military and may have forgotten that they purchased them. The release may be viewed at: www.fiscal.treasury.gov/news/veterans-affairs-reminder.html

FDIC Consumer News for June 2023 titled, Understanding Appraisals and Why They Matter, provides consumers with insights about the potential impact property appraisals may have on their finances. The article may be viewed at: www.fdic.gov/resources/consumers/consumer-news/2023-06.html

SEC unveiled a new public service campaign encouraging older investors to never stop learning when it comes to protecting their hard-earned money and investing for their future. The campaign features a new TV spot, “Never Stop Learning,” available in English and Spanish, and four informational videos about caregivers, trusted contacts, protecting investors’ retirement money, and the red flags of investment fraud. The release may be viewed at: www.sec.gov/news/ press-release/2023-106

FDIC updated its Supervisory Guidance on Multiple Re-Presentment NSF Fees (FIL-40-2022) to clarify its supervisory approach for corrective action when a violation of law is identified. While the revised guidance is nearly identical to the 2022 release, a revised footnote within the guidance provides that FDIC does not intent to request a bank conduct a lookback review absent a likelihood of substantial consumer harm. The revised guidance may be viewed at: www.fdic.gov/news/financial-institution-letters/2023/fil23032a.pdf

FTC provided its annual report to CFPB on its enforcement and related activities in 2022 on TILA, Consumer Leasing Act, and EFTA. The report highlights FTC’s enforcement actions related to the acts and their implementing regulations, including in the areas of automobile purchases and financing, payday lending, credit repair and debt relief, other credit, and electronic fund transfers. The report may be viewed at: www.ftc.gov/reports/2022-annual-report-cfpbregarding-enforcement-activities-under-tila-cla-efta

Another Wisconsin compliance officer is soon to retire. This time — Cheryl Parker, Senior Lending Compliance Specialist with Nicolet National Bank, Green Bay. She has over 30 years of experience in banking and lending and a 13-year career with Nicolet Bank. Cheryl is retiring on July 21, 2023.

In retirement Cheryl and her husband are planning to travel more. First vacation includes a trip to her dream destination, Hawaii. She will be spending more time with her three children and eight grandchildren. Also, she will be able to contribute more time in her role as a Children’s Pastor. Cheryl plans to take more time engaging in her hobbies such as gardening, reading, and relaxing during retirement. We wish Cheryl all the best!

The full announcement may be found on the WBA website at: www.wisbank.com/after30-years-cheryl-parker-of-nicolet-bank-ready-for-the-next-chapter/