Recent News
Zach Luke of Greenwood's Bank of Commerce has been elected to serve as president of Mississippi Young Bankers, a section of the Mississippi Bankers Association. Mississippi Young Bankers provides leadership development activities and supports financial literacy programs of the MBA and its member banks. Young Bankers members are involved in administering scholarship programs for high school and college students, supporting the MBA Education Foundation and advocating policy positions important to the banking industry. Luke serves as chief financial officer of the Bank of Commerce, where he... Read more
Radical change is possible in the banking sector. It's already happened, actually. Over the past 30 years, the U.S. banking sector went from one dominated by small, community banks to one dominated by massive, global banks. Public policy was a major driver of that shift. Some have spent the last decade or longer searching for ways to restore some community-mindedness to the banking sector. We can’t possibly list them all, but here are some of the ones we’ll be watching closely as the COVID-19 pandemic drags out into an economic recession and eventual recovery. Native American... Read more
Applications officially opened on April 3 for the new Paycheck Protection Program loans guaranteed by the Small Business Administration. The program is intended to help small businesses keep or rehire employees to get through at least part of the economic disruption from COVID-19. All or most of each loan can be forgiven, based on whether borrowers maintain employee levels they had before the economic disruption from the virus took hold. Serving small cities and towns and rural parts of Arkansas and the Mississippi Delta, Southern Bancorp was already approving and wiring Paycheck... Read more
An emergency loan program intended to get money swiftly into the hands of small businesses has all but collapsed under an unprecedented crush of applications and a shortage of funds, overwhelming agency officials and prompting urgent calls for action on Capitol Hill. The Economic Injury Disaster Loan program, or EIDL, a long-standing program run by the Small Business Administration (SBA), is separate from the $349 billion Paycheck Protection Program for small businesses that is the subject of a ... Read more
Community Development Financial Institutions, or CDFIs, are utilizing all resources at their disposal to help small businesses stay afloat as the novel coronavirus spreads throughout the U.S. CDFIs serve customers typically overlooked by mainstream financial institutions. Beneficial State Bank, an FDIC-insured CDFI that provides commercial banking services to underserved communities, had received 500 phone calls a day about PPP two days before the program even launched on April 3, Interim CEO Randell Leach said. CDBA members Bank Plus, Mission... Read more
Applying for PPP loans is urgent; but how do you sift through 10,400 banks and credit unions for ones that are more likely than others to take and process your application? Relying mostly on publicly available data, Mighty's platform profiles all 5,200 banks in the country, highlighting each bank's connections — or the lack thereof — to specific causes, communities and underserved small businesses. Many of those businesses are currently scrambling to find a bank willing to take their application for one of the new Paycheck Protection Program loans. ... Read more
Minority business owners have always struggled to secure bank loans. Now, many banks want to deal only with existing customers when making loans through the government's $349 billion aid package. Anticipating that minority business owners could struggle to tap federal aid, some lawmakers are proposing ways to earmark additional funds specifically for minority-owned businesses. And on Wednesday, a group of prominent black investors, including John W. Rogers Jr., the billionaire co-chief executive of Ariel Investments, a mutual fund manager, sent a letter to lawmakers expressing... Read more
CDBA CEO Jeannine Jacokes wrote to the House Financial Services and Small Business Committees urging that the next recovery package addressing the current health and economic crisis provide meaningful support for low- and moderate-income communities. To ensure resources are directed to the most severely impacted people and places, CDBA asks that Congress provide $1 billion for the Community Development Financial Institutions (CDFI) Fund, direct the Board of Governors of the Federal Reserve to create a meaningful set-a-side within its Main Street program for CDFIs and Minority Depository... Read more
Major banking trades, including the Community Development Bankers Association (CDBA), American Bankers Association (ABA), Bank Policy Institute (BPI), Independent Community Bankers of America (ICBA), National Bankers Association (NBA), and National Association of Affordable Housing Lenders (NAAHL), are collectively urging Congress to appropriate $1 billion for the Community Development Financial Institutions (CDFI) Fund to aid in economic recovery in response to the coronavirus pandemic. In letters to... Read more
President Trump on Tuesday praised some of the country's largest financial firms for pledging to take new steps to help small businesses disrupted by the coronavirus. Trump heralded their plans as he hosted a video conference with leaders of banks, including Darrin Williams of Southern Bancorp. You can view the video call here; Williams begins speaking around 6:30. The participants — who also included executives from community banks — have been helping the Treasury Department and Small Business Administration distribute $349 billion for the Paycheck Protection Program.
Community banks are eager to make loans to help their small-business customers stay afloat while the economy remains shut down due to social distancing, but many face a significant hurdle: They don't have enough deposits on hand to meet loan demand. As a result, small banks have been turning with more frequency to deposit placement firms like StoneCastle Partners in New York to help to secure the funding they need to offer bridge loans or participate in the federal government’s emergency small-business loan program. In the last week, Farmers & Merchants Bank in Miamisburg, Ohio,... Read more
Websites have crashed, phones are jammed and confusion reigns as businesses rushed at today's kickoff to get their chunk of the $350 billion Paycheck Protection Program. This is a race to save jobs in the present and the future, and to ensure that as many workers as possible keep their benefits and paychecks during the coronavirus lockdown. Because many banks only are accepting existing business clients, and some other banks aren't processing PPP loans at all, it's likely that many small businesses will get left out because they picked the "wrong" bank years ago.... Read more
CDBA and the major banking trades wrote congressional leaders to strongly urge that the provisions which would enhance and incentivize SBA's 7(a) loan program be included in the final CARES Act legislation. Private-sector banks and credit unions, whether they currently participate in SBA lending or not, will be turning to the SBA’s 7(a) loan program as the way to deliver capital and economic relief to the economy while conventional lending recedes in the wake of the current economic turmoil. However, in order to quickly stimulate essential lending, lenders need the tried and true... Read more
The Federal Reserve will temporarily stop all examination activity for banks with less than $100 billion of assets as it shifts supervisory priorities due to the coronavirus pandemic, the central bank said Tuesday. The Fed is shifting its supervisory focus to monitoring and outreach to "help financial institutions of all sizes understand the challenges and risks of the current environment." The agency said it will be minimizing examination activities in order to do so, with the greatest reduction at smallest banks. The temporary shift will last until at least the end of April, when the... Read more
Banks and credit unions are eager to take advantage of newfound flexibility for restructuring loans battered by the coronavirus outbreak. Federal regulators and the Financial Accounting Standards board gave lenders a helping hand Sunday, agreeing that short-term loan modifications tied to the pandemic do not have to immediately count as troubled-debt restructurings. Normally, any concession made to a borrower would trigger classification as a TDR. In the aftermath of the financial crisis, restructured loans at banks topped $140 billion at the end of 2011. Clearly, regulators are hoping to... Read more
The stakes are high for the financial services industry as lawmakers battle over the details of a new stimulus package to provide economic relief for businesses and consumers affected by the coronavirus outbreak. Although Senate Democrats blocked a vote on a package sponsored by Majority Leader Mitch McConnell, R-Ky., a whole host of provisions benefiting banks, credit union and other financial firms appears still to be on the table in McConnell's plan and other proposals being floated on Capitol Hill. McConnell's package included several industry-backed measures intended to make it easier... Read more
Restaurants and shops are closed across the U.S. to try to slow the spread of the coronavirus. The Federal government has started to address the resulting economic pain with an emergency declaration by President Donald Trump releasing $50 billion for public-health measures and congressional passage of a multi-billion dollar relief bill providing some paid sick leave and extended unemployment benefits, among other assistance. Fortunately, the U.S. Senate stepped up on Thursday to do more. Senate Republicans released a trillion-dollar economic recovery proposal that includes $1,200 direct... Read more
Congress is negotiating a sweeping stimulus package to offset the cascading damage wrought by the coronavirus. The package includes $500 billion for two waves of direct payments to taxpayers and an additional $500 billion in loans for businesses. To help small businesses specifically, those of us in the nonprofit small business lending space are coming together to ask Congress to apportion $1 billion of the $500 billion earmarked for businesses to go to the Community Development Financial Institutions Fund. The fund, which has strong bipartisan support, promotes economic revitalization in... Read more
The Board of Governors of the Federal Reserve System (Federal Reserve), the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) (collectively, the agencies) recognize the potential for Coronavirus Disease (also referred to as COVID-19) to adversely affect the customers and operations of financial institutions. On March 9, 2020, the federal financial institution regulatory agencies and state bank regulators issued a statement to encourage financial institutions to meet the financial services needs of their customers and members in areas... Read more
Promontory Interfinancial Network has named banking industry veterans Camden Fine and Ed Yingling to its board and former American Banker Editor-in-Chief Rob Blackwell as its chief content officer and head of external affairs. Fine was the head of the Independent Community Bankers of America for 15 years before retiring in 2018, while Yingling worked at the American Bankers Association for 26 years in various roles, including president and CEO. After leaving ABA in 2010, Yingling worked as a partner at Covington & Burling until departing in 2018 to run Edward Yingling Government... Read more