#2020-38, November 6, 2020

2020 Federal Election Results

Massachusetts Congressional Delegation
Members of the Massachusetts delegation will continue their democratic dynasty.  Senator Edward Markey and six members of the Massachusetts United State House delegation (Reps. McGovern, Clark, Moulton, Pressley, Lynch and Keating) defeated their challengers by a large margin.  Reps. Richard Neal, and Lori Trahan were unopposed. Newcomer Jake Auchincloss, a Democrat from Newton, will represent the 4^th District in the 117 Congress. He won over his Republican challenger and will fill the seat previously held by Rep. Joseph Kennedy III.

Presidential Election
At the time of this writing, the Presidential election results are still too close to call with decisions outstanding in several key states.  President Trump and Former Vice President Biden hold 215 and 253 electoral votes, respectively. The margins are razor-thin in the swing states of Arizona, Pennsylvania, Georgia, and Nevada.  As ballot counts continue today Biden is closing in on Trump's lead in Georgia and Pennsylvania.

If Biden wins, he will most likely focus on economic recovery efforts and address COVID challenges. A Biden Administration will have some impact on the banking industry. It would likely prioritize affordable housing and homeownership over capitalization of the GSEs, and push to reverse the tax reform legislation passed by Congress in 2018 and increase the corporate tax rate to 28 percent.

Congressional Races
While still uncertain, Republicans are expected to maintain control of the Senate led by Senator Mitch McConnell (R-KY), albeit with a smaller margin. The final result has not been determined-six races, all with Republican incumbents, have not been called. One key race watched closely in New England was the Senate race in Maine. Sen. Susan Collins’ (R) Democratic challenger Sara Gideon conceded the race Thursday afternoon.  A Republican-led Senate will have a mitigating effect on the progressive policies of a Democratic Administration. In addition, Mark Calabria, Director of the Federal Housing Finance Agency. would not be replaced which would be important for housing finance reform. As for banking leadership changes, Senator Crapo would move to the Finance Committee, and Senator Pat Toomey (R-PA) will become chair of the banking committee.

Democrats will likely maintain control of the House in the 117^th Congress. About three dozen races have not been called, but the Dems are likely to have a smaller margin than in the current Congress.  Three-hundred ninety-one of the 435 races have been called, with Democrats winning 201 seats and Republicans winning 190. Republicans have flipped eight seats, and Democrats flipped two. Representative Maxine Waters (D-CA) will continue to chair the House Financial Services Committee with a similar agenda focused on consumer-related issues.

Virtual Hill Visit with Representative Lori Trahan

Members of the MBA board, staff, and bankers representing cities from the third Congressional District met virtually with Rep. Lori Trahan.  The discussion focused on the Paycheck Protection Program loan forgiveness, Bank Secrecy Act Reform, and housing reform. Many thanks to the bankers that participated in the virtual Hill visit.  The Association will plan additional visits with members of Congress in the coming weeks.

Fed Adjusts Terms of Main Street Lending Program to Meet Needs of Smaller Borrowers

The Federal Reserve Board reduced the minimum loan size for its Main Street Lending Program from $250,000 to $100,000 and adjusted fees to encourage the provision of smaller loans. The Fed and Treasury Department also issued an FAQ clarifying that Paycheck Protection Program loans of up to $2 million may be excluded for purposes of determining the maximum loan size under the MSLP if specific requirements are met. For more information or to view the press release, click here.

Regional FDIC Offers Complimentary Webinar for New Bank Directors

The Federal Deposit Insurance Corporation (FDIC) plans to host a complimentary webinar on November 18, from 9:00 am-10:30 am for new bank directors. The webinar will focus on fundamental board governance issues, Directors' roles and responsibilities, the examination process, and effective strategies to monitor bank performance.  The webinar is designed for Directors with less than five years' experience, and there will be an opportunity to ask questions.  The FDIC will host the meeting on Microsoft TEAMS.

Please submit a list of participants and their email addresses to William Hardy at whardy@fdic.gov by November 11, 2020.

OCC Updates Corporate Governance Toolkit for Bank Directors

The OCC updated its Director's Toolkit designed to help national bank directors fulfill corporate governance responsibilities. The updated toolkit now includes a new publication, the "Director's Reference Guide to Board Reports and Information" and a revised "Director's Book: Role of Directors for National Banks and Federal Savings Associations.”

The Director's Toolkit and other resources for bank directors are available for download on OCC.gov