#2021-29, September 17, 2021

Bankers, Bank Customers Urged to Contact Congress in Opposition to IRS Reporting Proposal

MBA is urging all member bankers to contact their Senators and Representatives in Congress through the links provided below in opposition to this intrusive proposal mandating that banks collect and share account and transaction information on millions of customers with the IRS in an effort to increase tax compliance. While we strongly believe that Americans should honor their tax obligation, the proposal raises concerns regarding customer privacy and data security, increased compliance costs, and potential damage to customer relationships for community banks across America.  

As the Association has received bank customer inquiries expressing concerns about the proposal, we also encourage you to share this information with your customers, particularly your small business customers, and ask them to raise their concerns with their Senators and Representatives in Washington. Resources for customers are available on the websites below.

ACTION NEEDED: All member bankers are urged to contact Congress in opposition to the IRS reporting proposal, which is likely to be considered during debate on the budget reconciliation package in the coming days.  The American Bankers Association (ABA) and the Independent Community Bankers of America (ICBA) have sample letters to send to your Representatives and Senators.  Both groups also have resources to share with your customers to encourage them to oppose this proposal as well.  To access the ABA resources, click here, to access the ICBA resources, click here.

FDIC Launches Mission-Driven Bank Fund

Earlier this week, the Federal Deposit Insurance Corporation (FDIC) announced that it is launching a new mission-driven bank fund.  According to the agency, the fund will allow private investors, including corporations, financial institutions and philanthropic organizations, to support banks serving low- and moderate-income, minority and rural communities.

Mission-driven banks, which include minority depository institutions and community development financial institutions (CDFIs), can apply for funding to help them build size, scale and capacity to provide affordable financial products and services and stimulate economic and community development.  The FDIC is currently seeking a private fund manager and the announcement noted that the agency will not be involved in funding or investment decisions. The fund has already secured $120 million in investments from two anchor investors and one founding investor.

To read more, click here.

FDIC Releases 2022-2026 Strategic Plan

In related news, the FDIC also released a draft of its strategic plan for 2022-2026 for public comment this week.  The plan outlines the agency’s strategic goals include ensuring that insured depositors are protected from loss without recourse to taxpayer funding, that FDIC-supervised banks are safe and sound, that consumers’ rights are protected and banks are investing in their communities, that large banks can be resolved in an orderly manner in the event of bankruptcy and that resolutions are orderly and receiverships are managed effectively.

The draft plan also identifies several strategic challenges on the horizon, including the economy as the pandemic recovery persists. The agency notes that “while the banking industry continues to perform well, the interest rate environment and economic uncertainty continue to pose challenges for many institutions. Overall, the industry must manage interest-rate risk, liquidity risk, and credit risk carefully to remain on a long-term, sustainable growth path.”  Other challenges include nonbank competition with community banks and regional banks; innovation, information technology and cybersecurity; economic inclusion; and workforce development and management.

Comments on the draft plan are due by October 1.

To read more, click here.