Newsflash Dec. 13, 2012


December 13, 2012

Member News

Governor Andrew Cuomo Names Tax-Code Panel
Gannett New York Network

(12-11-12) A year after it was first unveiled, a panel tasked with brainstorming long-term fixes for New York’s tax code is beginning to take shape.
Former state Comptroller Carl McCall and Peter Solomon, the founder of New York City-based investment advisory firm Peter J. Solomon Company, have been tapped by Gov. Andrew Cuomo to co-chair the New York State Tax Reform and Fairness Commission, according to a list obtained by Gannett’s Albany Bureau. The commission was formed as part of a December 2011 deal to tweak the state’s tax brackets, an agreement that came while Cuomo and the Legislature were under pressure to prevent an added tax on the state’s top earners from expiring at the end of the year. That deal included a new bracket for those making more than $2 million annually, which expires at the end of 2014. Cuomo named ten people to the panel, including Deborah Wright, President and CEO of Carver Bancorp Inc. and Carver Federal Savings Bank.

“Three Michaels: A Berkeley Conversation”

(12-10-12) Authors Michael Chabon, Michael Lewis, and Michael Pollan appeared at the Berkeley Rep in “The Three Michaels: A Berkeley Conversation,”  to help enable the creation in Oakland of a tutoring and creative writing center for East Bay youth, dedicated to supporting students with their writing skills and to helping teachers inspire their students to write. Berkeleyside’s “Three Michaels: A Berkeley Conversation” is being supported by One PacificCoast Bank, founded in 2007 by Tom Steyer and Kat Taylor “to be a force for good,” according to Taylor who is the bank’s CEO.  “We want to be a model for how banks should operate, as it’s clear many banks have been responsible for unholy damage,” Taylor says, citing the mortgage crisis and the destruction of rain forests as examples.

Southern Bancorp Mission News
Southern Bancorp

(12-7-12) While parts of the country continue to see slow but steady economic recovery, many of the markets Southern Bancorp serves are still struggling. But Southern is striving to provide its customers and communities with the support and financing needed to accelerate economic recovery. For example, in its Mississippi markets, Southern recently launched several innovative small dollar loan products. They've also partnered with the Clarksdale Municipal School District to provide teachers with loans to help them achieve National Board Certification and have pioneeered a payday loan alternative product to provide a non-predatory alternative to the payday lenders. Additionally, Southern's bank and nonprofit partnership with Coahoma County continues to strengthen and yield tangible progress. The Coahoma County Delta Bridge Project, a comprehensive development initiative led by residents of Coahoma County and supported by Southern, launched about two years ago. Since then, over $2 million in new investments have been attracted in support of the goals outlined in the strategic plan.


Of Interest

CFPB Releases Study on Credit Reports
Consumer Financial Protection Bureau

(12-13-12) This paper describes the credit reporting infrastructure at the three largest nationwide consumer reporting agencies (NCRAs) – Equifax Information Services LLC (Equifax), TransUnion LLC (TransUnion), and Experian Information Solutions Inc. (Experian) – with a special focus on the infrastructure and processes currently used by the NCRAs to collect, compile, and report information about consumers in the form of credit reports.

TAG Bill Clears Key Senate Hurdle as White House Voices Support
American Banker

(12-11-12) The Obama administration released a statement of policy Tuesday in support of extending a crisis-era guarantee program for certain business bank accounts, ahead of a successful procedural Senate vote on the bill to limit debate on the issue. The bill, S. 3637, introduced by Majority Leader Harry Reid, would extend the Transaction Account Guarantee program for two years. The issue has divided a number of industry groups, pitting big banks and credit unions against smaller banks which argue they still need the guarantee. "The Transaction Account Guarantee (TAG) Program played an important role in maintaining financial stability and banking system liquidity for consumers and businesses during the financial crisis," said the statement of policy. "While the Administration supports a temporary extension of the program, it remains committed to actively evaluating the use of this emergency measure created during extraordinary times and a responsible approach to winding down the program." The Senate voted 76 to 20 in favor of a motion to limit debate on the issue on Tuesday afternoon, which likely clears the path for an additional procedural vote and a final Senate vote in favor of the bill as early as Thursday.

Small Bank's Surprise Decision May Threaten Treasury's Tarp Return
American Banker

(12-11-12) A bank's decision to balk at paying dividends to a private investor that bought its Troubled Asset Relief Program (TARP) shares may reduce investor interest in future auctions and weaken returns for the government. Basswood Capital Management won a Treasury bid in October to buy a portion of preferred TARP shares of $114 million-asset CenterBank in Milford, Ohio. Although the bank had never missed a dividend payment to Treasury and appeared in healthy condition, the financial institution sent a letter Nov. 13 to Basswood Capital saying it would not pay its quarterly dividend. The move caught the investment firm by surprise, especially when the bank's CEO gave his reasoning to a local paper, telling a reporter that the bank simply wanted to "keep our capital local as opposed to sending it to New York." The bank's decision is likely to have far-reaching consequences, however, including potentially spooking other investors away from future Treasury auctions and reducing the government's return. "It will open the eyes to some investors that the dividend deferral feature is not merely a theoretical possibility," said Kip Weissman, a partner at law firm Luse Gorman Pomerenk & Schick. "It will probably depress prices."

Treasury Accepting Losses as Small Banks Exit Bailout Program
Washington Post

(12-7-12) At 9 a.m. on Nov. 30, the Treasury Department began auctioning off its shares in seven community banks scattered across the country. Each of these institutions had taken money from the government in 2009 during the financial crisis. By the time the bidding closed at 6 p.m. Monday, the Treasury had collected about $62 million. However, the government’s original investment in these banks totaled $75 million. It was not the first time the government walked away with a loss. In 10 similar auctions conducted to date, Treasury has sold off its investments in 84 financial firms, accepting losses of about $241 million. “Treasury has shifted its emphasis and is no longer focused on promoting financial stability,” said Christy Romero, special inspector general for the TARP. “Instead, Treasury wants to declare success and move on.” Treasury officials said the bids the department has received reflect what the market is willing to bear at this point. Besides, they said, the ultimate goal is to wind down TARP in an efficient way. Moreover, the government may have sold shares in these community banks at a loss, but these firms also paid $307 million in dividends to Treasury coffers, aside from the money recouped from the auctions. Overall, Treasury has turned a profit from its small-bank investment. “We want a competitive, transparent process, and that’s exactly what we’ve had with the auctions,” Treasury Assistant Secretary Timothy G. Massad said.


National Community Investment Fund - Senior Analyst, Social Impact Evaluation and Investments (Chicago, IL)
NCIF is currently seeking a Senior Analyst – Social Impact Evaluation and Investments. The successful candidate will support the Chief Executive on the following key activities of NCIF: social performance metrics and research, financial analysis, marketing and communications, and other related activities. Full details available here

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Contact Name: Dana Weinstein;; 202-689-8935 x32

Thursday, December 13, 2012