Product Updates for May 2020
The Product Updates for May 2020 from BankPolicies.com feature the following new job description and revised policy template products:
These new products were developed in response to client requests who submitted their suggestions to our “Client Wish List.” Your comments and ideas are always greatly appreciated and will be taken into consideration whenever we revise our current products or create new ones. In summary, we want to ensure your success and earn your business!
The update to these products is in response to the FFIEC Press Release entitled “Federal and State Regulators Release Updates to BSA/AML Examination Manual” dated 04/15/20 that announced several updates to the Bank Secrecy Act/Anti-Money Laundering (BSA/AML) examination manual, which is used to evaluate compliance with the Bank Secrecy Act (BSA) and anti-money laundering (AML) requirements.
As a reminder, the complete contents of the Anti-Money Laundering Policy Template – Bank Version are included as Topic 14, Customer Identification Program Policy Template are included as Topic 7, and Office of Foreign Assets Control Policy Template are included as Topic 19 within the Bank Secrecy Act Policy Template – Comprehensive Version.
The update to this product is in response to the Joint Press Release entitled “Federal Banking Agencies to Defer Appraisals and Evaluations for Real Estate Transactions Affected by COVID-19” dated 04/14/20 that announced an interim final rule to temporarily defer real estate-related appraisals and evaluations under the agencies’ interagency appraisal regulations. The Federal Reserve Board, the Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency are providing this temporary relief to allow regulated institutions to extend financing to creditworthy households and businesses quickly in the wake of the national emergency declared in connection with COVID-19.
In addition, the federal banking agencies, together with NCUA and the Consumer Financial Protection Bureau, in consultation with the Conference of State Bank Supervisors, issued a joint statement entitled “Interagency Statement on Appraisals and Evaluations for Real Estate Related Financial Transactions Affected by the Coronavirus” dated 04/14/20 to address challenges relating to appraisals and evaluations for real estate-related financial transactions affected by COVID-19. The interagency statement outlines other flexibilities in industry appraisal standards and in the agencies’ appraisal regulations and describes temporary changes to Fannie Mae and Freddie Mac appraisal standards that can assist lenders during this challenging time. The agencies will continue to communicate with the industry, as appropriate, as this situation evolves.
The update to this product is in response to NACHA’s announcement that the:
Upcoming effective dates of the rule on “Supplemental Data Security Requirements” are extended by one year, to June 30, 2021 and June 30, 2022, respectively. The extension is in response to requests from some covered parties for additional time to come into compliance with the rule requirements, NACHA is extending each of the two effective dates by one year; Phase 1 of the rule, which applies to ACH Originators and Third-Parties with more than 6 million ACH payments annually, is now effective on June 30, 2021, and Phase 2 of the rule, which applies to ACH Originators and Third-Parties with more than 2 million ACH payments annually, is now effective on June 30, 2022. Covered parties are urged to become compliant with the new rule as soon as circumstances permit, but no later than these new effective dates.
Same Day ACH processing window will go into effect on March 19, 2021 in relation to the “Expanding Same Day ACH” rule which expands access to Same Day ACH by allowing Same Day ACH transactions to be submitted to the ACH Network for an additional two hours every business day.
The update to these products is in response to the FFIEC Press Release entitled “FFIEC Issues Statement on Risk Management for Cloud Computing Services” dated 04/30/20 that addresses the use of cloud computing services and security risk management principles in the financial services sector.
Security breaches involving cloud computing services highlight the importance of sound security controls and management’s understanding of the shared responsibilities between cloud service providers and their financial institution clients. The statement highlights that management should not assume that effective security and resilience controls exist simply because the technology systems are operating in a cloud computing environment. In addition, the statement highlights examples of risk management practices for a financial institution’s safe and sound use of cloud computing services and safeguards to protect customers’ sensitive information from risks that pose potential consumer harm. Furthermore, the statement provides a list of government and industry resources and references to assist financial institutions using cloud computing services.
The update to this product is in response to the Joint Press Release entitled “Current Expected Credit Losses: Final Rule with Technical Changes to Interim Final Rule” dated 04/22/20 that announced a final rule that makes technical changes in the interim final rule that the agencies announced on March 27, 2020. The interim final rule allows certain banks to delay the estimated impact on regulatory capital stemming from the implementation of Accounting Standards Update No. 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (CECL).
The update to this product is in response to the Families First Coronavirus Response Act (FFCRA) dated 04/01/20 that requires employers with fewer than 500 employees to provide paid leave to employees who are impacted by COVID-19 and offer tax credits to employers that do so. The law was effective April 1, 2020 and expires on December 31, 2020.
The update to this product is in response to OCC Bulletin 2020-26 entitled “Interest Rate Risk: Revised Comptroller’s Handbook Booklet” dated 03/26/20 that announced a revised “Interest Rate Risk” booklet of the Comptroller’s Handbook. The revised booklet incorporates and reflects applicable statutes and regulations, guidance, and examination procedures. The booklet includes information from interagency guidance and OCC issuances published since the previous publication of this booklet.
The update to these products is in response to the Joint Press Release entitled “Federal Agencies Encourage Mortgage Servicers to Work with Struggling Homeowners Affected by COVID-19” dated 04/03/20 that issued a joint policy statement providing needed regulatory flexibility to enable mortgage servicers to work with struggling consumers affected by the Coronavirus Disease (referred to as COVID-19) emergency. The actions announced by the agencies inform servicers of the agencies’ flexible supervisory and enforcement approach during the COVID-19 pandemic regarding certain communications to consumers required by the mortgage servicing rules. The policy statement and guidance will facilitate mortgage servicers’ ability to place consumers in short-term payment forbearance programs such as the one established by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
In addition, the updates to the Mortgage Loan Servicing Policy Template and Regulation X Policy Template are in response to the CFPB’s Bulletin 2020-02 entitled “Handling of Information and Documents During Mortgage Servicing Transfers” dated 04/24/20 that outlined practices to provide mortgage servicers clarity, facilitate compliance, and prevent harm to consumers during the transfer of residential mortgages.
As a reminder, the complete contents of the Mortgage Loan Servicing Policy Template are included as Topic 18 within the Regulation X Policy Template. In addition, the complete contents of the Foreclosure Policy Template are included as Topic 22 within the Mortgage Loan Policy Template.
The update to these products is in response to the Joint Release entitled “Interagency Statement on Loan Modifications and Reporting for Financial Institutions Working with Customers Affected by the Coronavirus” dated 04/07/20 that encourages financial institutions to work constructively with borrowers impacted by the Coronavirus Disease 2019 (referred to as COVID-19), provides additional information regarding loan modifications, and clarifies the interaction between the interagency statement and related relief provided by the Coronavirus Aid, Relief, and Economic Security Act (CARES Act).
As a reminder, the complete contents of the Troubled Debt Restructuring and Loan Workout Policy Template are included as Topic 8 within the Non-Accrual and Charged-Off Loan Policy Template.
The update to this product is in response to CFPB’s “Home Mortgage Disclosure (Regulation C) Final Rule” dated 04/16/20 that amends Regulation C to increase the threshold for reporting data about closed-end mortgage loans, so that institutions originating fewer than 100 closed-end mortgage loans in either of the two preceding calendar years will not have to report such data effective July 1, 2020. The CFPB is also setting the threshold for reporting data about open-end lines of credit at 200 open-end lines of credit effective January 1, 2022, upon the expiration of the current temporary threshold of 500 open-end lines of credit.
The update to this product is in response to the Federal Reserve’s Press Release entitled “Federal Reserve Board Announces Interim Final Rule to Delete the Six-Per-Month Limit on Convenient Transfers from the “Savings Deposit” in Regulation D” dated 04/24/20 that announced an interim final rule to amend Regulation D (Reserve Requirements of Depository Institutions) to delete the six-per-month limit on convenient transfers from the “savings deposit” definition. The interim final rule allows depository institutions immediately to suspend enforcement of the six-transfer limit and to allow their customers to make an unlimited number of convenient transfers and withdrawals from their savings deposits at a time when financial events associated with the coronavirus pandemic have made such access more urgent.
The update to this product is in response to Federal Reserve Press Release entitled “Federal Reserve Board Announces Rule Change to Bolster the Effectiveness of the Small Business Administration’s Paycheck Protection Program” dated 04/17/20 that announced a rule change to bolster the effectiveness of the Small Business Administration’s (SBA) Paycheck Protection Program (PPP). The change will temporarily modify the Federal Reserve Board’s rules so that certain bank directors and shareholders can apply for PPP loans for their small businesses.
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