#2021-9, March 12, 2021

President Signs COVID-19 Relief Bill; IRS Begins Processing EIPs

This week, President Biden signed the $1.9 trillion COVID-19 relief bill into law. The bill, which includes numerous provisions assisting individuals and businesses affected by the pandemic, also authorizes another round of $1,400-per-person economic impact payments that will be paid to eligible taxpayers.

According to the IRS, the first set of ACH files were sent this morning for payment on Wednesday, March 17.  Paper checks and prepaid cards are also beginning to be processed, but the agency did not provide details on the volume of payments that will be mailed.  While the IRS is working to update its Get My Payments Tool, given the short timeframe between when the bill was signed and the first payment distribution, the tool will only provide status updates for taxpayers who have filed their 2019 or 2020 tax return with direct deposit.

As Congress worked to finalize the relief bill, the American Bankers Association (ABA), the Independent Community Bankers of America (ICBA), and a coalition of finance and consumer advocacy groups urged the House and Senate to exempt these EIPs from garnishment. Unfortunately, due to procedural hurdles and the timing of the bill's passage, this provision was not included in the measure. The group has asked Treasury Secretary Janet Yellen to support standalone legislation to ensure that economic impact payments are shielded from assignment and garnishment. The groups called for immediate legislative action, noting that banks and other financial services providers must comply with court-ordered garnishments if Congress does not act. Read the letter.

ABA and ICBA have developed summaries and talking points for bankers regarding the EIPs.  To access the ABA summary, click here and to download the talking points, click here.  To access the ICBA materials, click here.

Bipartisan Bills Introduced to Extend Paycheck Protection Program

House Small Business Committee Chair Nydia Velasquez (D-NY) and Ranking Member Blaine Luetkemeyer (R-MO) this week introduced a bipartisan bill that would extend the deadline for new Small Business Administration Paycheck Protection Program (PPP) loans through May 31, 2021.

As we have reported previously, the automated checks the SBA implemented to minimize waste, fraud, and abuse of funds has resulted in a slower approval process of PPP loans. While SBA is working to resolve any hold codes, the bill also grants the agency an additional month to process loan applications submitted by that date before the program ends on June 30. The House is expected to vote on the bill next week.  A companion bill was also introduced in the Senate by Sens. Ben Cardin (D-MD), Jeanne Shaheen (D-NH), and Susan Collins (R-ME).

We Need Your Input on CBLR Compliance

The Association wants to better understand your bank's current situation surrounding balance sheet growth and leverage ratio pressures. We ask that one individual (CEO, CFO) from each member bank complete the following two-question survey to understand better any issues related to the bank's compliance with the Community Bank Leverage Ratio (CBLR) requirements.

To take the survey, click here.

Federal Reserve Extending PPPLF

The Federal Reserve recently announced that it will extend the Paycheck Protection Program Liquidity Facility (PPPLF) until June 30.  PPP loans guaranteed by the SBA that are originated by eligible banks may be pledged as collateral to the Federal Reserve Banks. The PPPLF was originally set to expire on March 31.

CFPB: Gender Identity, Sexual Orientation Discrimination Illegal Under ECOA

The Consumer Financial Protection Bureau (CFPB) issued an interpretive rule this week clarifying that the prohibition against sex discrimination as part of the Equal Credit Opportunity Act (ECOA) and Regulation B includes sexual orientation and gender identity discrimination. The Bureau also stated that the "prohibition also covers discrimination based on actual or perceived nonconformity with traditional sex- or gender-based stereotypes, and discrimination based on an applicant’s social or other associations."

As part of the interpretive rule, the CFPB will update its publications and examination guidance documents and will take enforcement actions against lenders for SOGI-related ECOA violations. The Bureau also said the interpretive rule is consistent with a 2020 Supreme Court ruling that the prohibition against sex discrimination in the Civil Rights Act of 1964 encompasses sexual discrimination based on sexual orientation or gender identity. The interpretive rule is effective when it is published in the Federal Register. 

To read more, click here.

Senate Banking Committee Advances SEC and CFPB Nominations

The Senate Banking Committee this week voted 14-10 to approve Gary Gensler's nomination as Securities and Exchange Commission chairman. Rohit Chopra's nomination as head of the Consumer Financial Protection Bureau was deadlocked in a 12-12 vote along party lines but will advance to the full Senate for consideration.

Register for the ABA Government Relations Washington Summit

We encourage your participation in the ABA's government relationships summit. All banks can register at no charge for the meeting, which features lawmakers, regulators, and  ABA staff discussing current industry priorities.

To register and view the schedule, click here.