#2022-07, February 25, 2022

Biden Administration Announces Broad Economic Sanctions against Russia

President Biden yesterday announced a series of broad economic and banking sanctions against Russia after the invasion of Ukraine earlier this week.  The sanctions include prohibitions on doing businesses with several Russian financial institutions and individuals in the Russian government.

In a statement, the Treasury Department said that within 30 days, the Office of Foreign Assets Control (OFAC) will require all US banks “to close any Sberbank correspondent or payable-through accounts and to reject any future transactions involving Sberbank or its foreign financial institution subsidiaries.  Payments that Sberbank attempts to process in US dollars for its clients will be disrupted and rejected once the payment hits a US financial institution.”  OFAC will also impose full blocking sanctions on VTB Bank, a systemically important institution that holds nearly 20 percent of all banking assets in Russia.  This includes an immediate freeze on all assets held by VTB Bank and its 20 subsidiaries held at US financial institutions.

In addition, OFAC will block three additional Russian banks -- Otkritie, Novikom and Sovcom -- from accessing the US financial system.  The sanctions also include debt and equity prohibitions against 13 other state and private-owned firms operating in the financial services sector, as well as a series of actions targeting several Russian families with close ties to President Putin.  OFAC also sanctioned 24 Belarusian individuals and entities for their support for and facilitation of the Russian invasion.

To read more about the Russian sanctions, click here, to read about the Belarusian sanctions, click here.  To view the White House fact sheet, click here.

CFPB Announces Automated Valuation Model (AVM) Rulemaking Proposals

The Consumer Financial Protection Bureau (CFPB) recently announced the next step in a joint rulemaking regarding quality control standards for the use of computer models, known as automated valuation models (AVMs), to help assess home valuations.  The Dodd-Frank Act requires the financial regulators to promulgate rules to strengthen the oversight of the models to “ensure a high level of confidence in the estimates; protect against the manipulation of data; avoid conflicts of interest and require random sample testing and reviews.”

In the announcement, the Bureau said the computer models and algorithms improve valuation accuracy for mortgage lenders and appraisers, but there is concern that AVMs can pose fair-lending risks to buyers and sellers.  The Bureau will now review the options to determine their potential impact on small banks and businesses through initiation of the Small Business Regulatory Enforcement Review Act review process required for all CFPB rulemakings.

To read more, click here.

Registration for ABA Washington Summit and ICBA Capital Summit Now Open

The American Bankers Association (ABA) is hosting its annual Washington Summit in Washington, DC on March 7-9, 2022.  The meeting will feature opportunities to hear from key federal policymakers and regulators throughout the conference.  In conjunction with the Washington Summit, ABA is also hosting the Mutual Community Bank Forum, Emerging Leaders Forum, and the Women’s Leadership Forum.  The program will be available in a virtual, livestream format this year, so staff at your bank can participate without traveling to Washington.

For more information on ABA’s Washington Summit and to register, click here.

In addition, the Independent Community Bankers of America (ICBA) recently announced that registration is now open for the Capital Summit, which will be held on May 1-4, 2022 in Washington.  Invited speakers include Treasury Secretary Janet Yellen and Senate Banking Committee member Tim Scott (R-SC).

For more information on ICBA’s Capital Summit and to register, click here.

Regulators Hosting Virtual Community Reinvestment Conference

On March 15-17, the federal banking regulatory agencies will host the 2022 virtual National Interagency Community Reinvestment Conference on March 15-17.  The biennial conference offers participants the opportunity to learn about the CRA, participate in regulator-led training on CRA examinations and discuss best practices, emerging ideas, and challenges in community development.

To learn more and register for the conference, click here.