ABA Banking Journal
April 14, 2017

This ABA Banking Journal newsletter is a free, twice-monthly supplement to the ABA Banking Journal magazine intended to help you stay on top of industry and policy news. You can also stay abreast of banking news by visiting aba.com/BankingJournal, home to ABA Daily Newsbytes and other email bulletins.

Industry News
Americans’ expectations for how much more they will spend in the next year landed at 3.29 percent in March, a slight nudge from February’s 3.19 percent reading, according to the Federal Reserve Bank of New York’s monthly Survey of Consumer Expectations. The outlook for household income growth declined, landing at 2.52 percent from 2.8 percent in February. (ABA Banking Journal)
Small merchants place a higher value on the services they get when accessing the payments system than on paying a low interchange rate, according to a recent survey. As a result, merchants paying a higher interchange rate actually express more satisfaction at the services they receive—suggesting the Durbin Amendment’s price cap approach may not reflect Main Street retailers’ preferences. The survey was conducted by Javelin for the Electronic Payments Coalition. (Electronic Payments Coalition)
Last October, the CFPB released comprehensive amendments to the mortgage servicing rules—the sixth servicing-related rulemaking since February 2013. While some of the new rules can be characterized as a much-needed "sweep up" that provides clarifications and technical corrections, the rules also include significant substantive changes that will require banks to invest in technology, make changes to servicing systems and develop new policies, procedures and processes. Now is the time for banks to mobilize their change management teams, budget for implementation, allocate staff time and proactively inquire about third-party vendor preparations to comply with the new requirements. (ABA Banking Journal)
If you can’t beat ’em, join ’em. In the summer of 2016, JPMorgan Chase & Co. CEO Jamie Dimon said his firm could give clients a free, automated investment service as part of a future bundle of digital-banking products. Well, he just revealed the bank is following through on that promise and building one. (Mashable)
Data Center, Inc. (DCI)
Verint Systems
U.S. employers posted more open positions in February, but the number of people getting hired and the number quitting jobs fell. The overall figures suggest that the job market remains healthy, although it has yet to take off during the early stages of the Trump presidency. The Labor Department said Tuesday that job openings rose 2.1 percent in February to a seasonally adjusted 5.7 million. (New York Times)
Timely information on small business financing needs, decisions and outcomes is critical to understanding and fostering the sector’s health and growth. To provide these insights to policymakers, researchers and service providers, the Small Business Credit Survey is a national collaboration among the 12 Reserve Banks of the Federal Reserve System. (Federal Reserve Bank of New York)
Online retailers have several advantages over their brick-and-mortar counterparts. They have lower costs, plus a place on the smartphone screens (and in the hearts) of younger shoppers. Yet the bulk of shopping still takes place in brick and mortar stores. Now, a coalition promoting card-linking technology believes brick-and-mortar merchants may be ready to give FIs and payment networks access to the industry’s most jealously guarded secret—SKU-level data. (Bank Innovation)
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Policy News
A group of community bankers from diverse institutions across the country met with Treasury Secretary Steven Mnuchin and his team to explore unnecessary and outdated regulations that are hindering economic growth and making it more difficult for banks to serve their customers and communities. Among the attendees were ABA President and CEO Rob Nichols and 16 bankers, including ABA officers and several members of key ABA committees, as well as a delegation of bankers from the Independent Community Bankers of America. (ABA Banking Journal)
As part of the banking industry’s continuing response to President Trump’s executive order outlining "core principles" for financial regulation, the American Bankers Association provided recommendations to the Treasury Department this week on areas where the bank capital framework can be improved. Specifically, ABA recommended ending the penalty on banks for holding mortgage servicing assets, among other recommendations. (ABA Banking Journal)
Computer Services Inc
LexisNexis Risk Solutions
Last week, Sens. Mike Rounds (R-S.D.) and Mark Warner (D-Va.) reintroduced a bipartisan bill that would expand banks’ ability to count municipal securities as high-quality liquid assets under the Liquidity Coverage Ratio. A similar bill backed by ABA passed the House in the last Congress. (ABA Banking Journal)
A sweeping Republican rewrite of the Dodd-Frank Act would significantly reduce the CFPB's power and subject it to greater White House and congressional oversight. The bill would turn the CFPB into an executive agency with a removable director, drastically limited powers and a budget controlled by Congress. House Republicans are preparing major changes to the Dodd-Frank Act, with GOP House Financial Services Chairman Jeb Hensarling (R-Texas) planning to release a comprehensive rewrite of the bill by the end of April. (The Hill)
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