R. Kinney Williams - Yennik, Inc.
R. Kinney Williams
Yennik, Inc.

The Community Banker
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Bank Regulatory News
November 1999

November 30, 1999 - The FDIC has issued the public list of institutions that it has scheduled for a Community Reinvestment Act (CRA) examination during the first quarter of 2000. This list is published pursuant to revised CRA regulations published in May 1995 that require each Federal bank and thrift regulator to publish a quarterly CRA examination schedule at least 30 days before the beginning of each quarter.

November 29, 1999 - Gallup Survey Results
The Federal Deposit Insurance Corporation (FDIC) and the Board of Governors of the Federal Reserve System recently sponsored a second Gallup survey to track bank customers' attitudes and beliefs about their banks' readiness for the Year 2000 transition.  The survey, which is ongoing, began on October 19, 1999.  The following results are reported as of mid-November.  For more information about the survey results, refer to the attached Gallup report, which is also available on the FDIC's Web site at www.fdic.gov.

November 29, 1999 - FFIEC Year 2000 Information Security Precautions
The Federal Financial Institutions Examination Council (FFIEC) has issued the attached advisory reminding financial institutions about establishing safeguards to prevent attempts to exploit information systems during the rollover period.

November 24, 1999 - Required Reports of Indebtedness by Executive Officers and Principal Shareholders
The attached form FFIEC 004 may be used for complying with the reporting requirements of Title VIII of the Financial Institutions Regulatory and Interest Rate Control Act of 1978 for calendar year 1999. The Act requires each bank's executive officers and principal shareholders to submit an annual report to their board of directors on their indebtedness, and that of their related interests, to correspondent banks.

November 24, 1999 - California Thrift Has Right to Charge Nonclients for ATM Use, OTS Opinion Says
WASHINGTON, D.C., Nov. 24, 1999 – In a legal opinion made public today, the Office of Thrift Supervision (OTS) states that, under federal law, First Federal Bank of California, a $3.65 billion federal savings association, has the right to charge fees for the use of its automatic teller machines (ATMs) by those who are not its customers.

November 24, 1999 - OCC RELEASES CRA EVALUATIONS FOR 56 NATIONAL BANKS
WASHINGTON, DC -- The Office of the Comptroller of the Currency (OCC) today released a list of Community Reinvestment Act (CRA) performance evaluations that became public during the period of October 15 through November 14. The list contains only national banks and insured federal branches of foreign banks that have received ratings. The possible ratings are outstanding, satisfactory, needs to improve, and substantial noncompliance.

November 24, 1999 - The Federal Deposit Insurance Corporation has published its semiannual agenda of regulations in the Federal Register to inform the public of the Corporation's regulatory actions and encourage participation in the rulemaking process.

November 22, 1999 - The Federal Deposit Insurance Corporation (FDIC) today released a list of orders of administrative enforcement actions taken against banks and individuals in October. No administrative hearings are scheduled for December.

November 22, 1999 - The Federal Deposit Insurance Corporation (FDIC) has approved the purchase and assumption of the insured deposits of Pacific Thrift and Loan Company, Woodland Hills, California, by Affinity Bank, Ventura, California.  Pacific Thrift and Loan, a state chartered industrial loan bank with total assets of $117.6 million, was closed today by the California Superintendent of Banks, and the FDIC was named receiver.

November 19, 1999 - FFIEC Advisory on Year 2000 Information Security Precautions
WASHINGTON, D.C. -- The Federal Financial Institutions Examination Council (FFIEC) today issued an advisory to financial institutions concerning information security precautions during the century rollover period. Today’s statement serves as a reminder of the FFIEC’s previously issued guidance regarding the importance of maintaining an effective security program.

November 19, 1999 - Massachusetts Mutual Granted Federal Thrift Charter By OTS
Massachusetts Mutual Life Insurance Company has received approval from the Office of Thrift Supervision (OTS) to organize The MassMutual Trust Company, a thrift savings bank, to provide trust and trust-related services to the public. The insurance company becomes a unitary thrift holding company.  MassMutual Insurance, based in Springfield, Mass., is the sixth largest mutual life insurance company in the United States, with more than 2.7 million policyholders. Among its operations are retirement and investment management services and the Oppenheimer Funds, a family of mutual funds.

November 18, 1999 - OTS Grants Thrift Charter to Capital Group Companies
Capital Group Companies, Inc., Los Angeles, which operates the nation’s third largest mutual fund family, has received a federal thrift charter from the Office of Thrift Supervision (OTS) to organize a trust bank to be based in Brea, California. The new institution will be named Capital Bank and Trust Company and provide only trust services. The parent becomes a unitary thrift holding company.  The new Capital Bank will assume approximately $65 billion in trust accounts from other existing Capital Group companies.

November 18, 1999 - Consumer Confidence in Banking Y2K Preparation Rises Sharply, Gallup Poll Reports WASHINGTON, D.C. - Current figures indicate nine out of ten U.S. bank customers believe that their banks are ready for the Year 2000 -- or Y2K -- according to a new survey by the Gallup Organization. By comparison, a March survey found that an estimated 76 percent of bank customers were confident that their banks would solve the Y2K problem.

November 17, 1999 - Comptroller Says Financial Modernization Law Will Strengthen Banking System
Comptroller of the Currency John D. Hawke, Jr. said in a talk before the Exchequer Club of Washington today that the Gramm-Leach-Bliley financial modernization law promises to enhance bank safety and soundness by expanding opportunities for banks to diversify their earnings streams and reduce their heavy reliance on net interest income.

November 17, 1999 - Potential Violations of Section 8 of the Real Estate Settlement Procedures Act
The Federal Deposit Insurance Corporation (FDIC) has prepared the attached document to alert FDIC-supervised institutions of practices that may result in violations of Section 8 of the Real Estate Settlement Procedures Act (RESPA). Violations of Section 8 carry criminal and civil penalties. Recent compliance examinations have uncovered violations of Section 8 of RESPA and the regulation that implements RESPA, the Department of Housing and Urban Development's (HUD) Regulation X.

November 17, 1999 - Capital Treatment for Synthetic Collateralized Loan Obligations
The advent of credit derivatives several years ago has led to dramatic innovations in the asset securitization market.  As discussed in previous Federal Reserve guidance, credit derivatives are on- and off-balance-sheet financial instruments that permit banking organizations to assume or transfer credit risk on a specified or "referenced" asset or pool of assets.

November 16, 1999 - Persons Banned from Banking Posted on OTS Internet Web Site
Beginning today it is easier to identify persons banned from the banking industry by the Office of Thrift Supervision (OTS). The agency has posted on its web site the names of persons it has banned from the industry for violating federal laws or regulations.

November 16, 1999 - Treasury Secretary Lawrence H. Summers, Treasurer Mary Ellen Withrow and Secret Service Director Brian L. Stafford on Tuesday unveiled the redesigned $10 and $5 bills that include new and modified security features to deter counterfeiting of U.S. currency.

November 16, 1999 - The Federal Open Market Committee today voted to raise its target for the federal funds rate by 25 basis points to 5-1/2 percent. In a related action, the Board of Governors approved a 25 basis point increase in the discount rate to 5 percent.

November 16, 1999 - The Federal Reserve Board today announced the execution of a Written Agreement by and among Heritage Bancorp Company, Inc., Cleveland, Oklahoma; the First Bank of Cleveland, Cleveland, Oklahoma; the Federal Reserve Bank of Kansas City; and the Oklahoma State Banking Department.

November 16, 1999 - The Federal Reserve Board today announced the issuance of a consent Order against Bertram Smith, an institution-affiliated party of the First Western Bank, Cooper City, Florida, a state member bank.  The individual, without admitting to any allegations, consented to the Order to resolve allegations that he violated the Change in Bank Control Act in connection with his acquisition of beneficial ownership of the shares of the bank.

November 16, 1999 - The Federal Reserve Board today announced the issuance of a consent Order against Matthew J. Callahan, an institution-affiliated party of the First Western Bank, Cooper City, Florida, a state member bank.  The individual, without admitting to any allegations, consented to the Order to resolve allegations that he violated the Change in Bank Control Act in connection with his acquisition of beneficial ownership of the shares of the bank.

November 16, 1999 - The Federal Reserve Board today announced the issuance of a consent Order against Robert and Adele Barber, both institution-affiliated parties of the First Western Bank, Cooper City, Florida, a state member bank.  The individuals, without admitting to any allegations, consented to the Order to resolve allegations that they violated the Change in Bank Control Act in connection with their acquisition of beneficial ownership of the shares of the bank.

November 12, 1999 - The Federal Reserve Board today approved modifications to the settlement finality for ACH credit transactions processed by the Federal Reserve Banks so that settlement becomes final when posted to depository institutions' accounts. The Board will require prefunding for any ACH credit transactions that settle through a Federal Reserve account that is being monitored in real time to help manage settlement risk.

November 10, 1999 - Bank Regulators' Data Show Increase in Adversely Classified Syndicated Bank Loans WASHINGTON _ Syndicated bank loans rated adversely by examiners increased in 1999 from low levels, according to data released today by three federal bank regulatory agencies.

November 10, 1999 - Questions and answers regarding joint interagency statement of policy for administrative enforcement of the truth-in-lending act - reimbursement issued by the FFIEC on July 11, 1980 and revised October 1998.

November 9, 1999 - FDIC examiners reported no significant change in overall loan underwriting practices at FDIC-supervised banks, according to the FDIC's latest Report on Underwriting Practices covering the six months ending September 30, 1999. However in the major lending category of agriculture, examiners reported increased concerns about the level of farm banks' "carryover debt" - agricultural loans not paid off at the end of the growing season.

November 9, 1999 - Agencies Announce Results of Financial Institution Web Site Privacy Survey.
WASHINGTON -- The four federal banking agencies today released a report on the results of a survey of Internet privacy policies of banking and thrift institutions.

November 8, 1999 - Comptroller Hawke Highlights Strong Commitment Community Banks Have Made to Risk Management - Comptroller of the Currency John D. Hawke, Jr. today highlighted the strong commitment community banks have made to risk management, citing examples of practices that he said exemplify risk management at its best.

November 5, 1999 - The attached final rule on the extended examination cycle for federal branches and agencies was published in the Federal Register on October 22, 1999.

November 5, 1999 - The Office of Thrift Supervision (OTS) today released savings associations' Community Reinvestment Act (CRA) performance evaluation ratings that became available in October 1999.

November 5, 1999 - The FDIC today issued its monthly list of state nonmember banks recently evaluated for compliance with the Community Reinvestment Act (CRA). The list covers evaluation ratings that were issued in August 1999.

November 5, 1999 - The Office of the Comptroller of the Currency today filed a brief with the U.S. District Court for Northern California in connection with the litigation challenging local ordinances that would prohibit banks from charging fees for automated teller machine usage.  Attachment

Novemeber 05, 1999 - 1999 Trust Survey Transmission via the Internet
The Federal Deposit Insurance Corporation (FDIC) serves as collection agent for the Federal Financial Institutions Examination Council's (FFIEC) Annual Report of Trust Assets (ARTA). Institutions with trust powers may opt to submit their 1999 ARTA via the Internet. Institutions wishing to file the report in hard copy may still do so.

November 4, 1999 - The Chairman of the Finance Commission of Texas, W.D. Hilton, Jr., announced today the selection of Randall S. James as the new Banking Commissioner of Texas and Executive Director of the Finance Commission.

November 4, 1999 - The National Credit Union Administration Board announced today that it has issued
a prohibition order against the following former credit union employee and official.

November 3, 1999 - The Federal Reserve Board today published its annual adjustment of the dollar amount that triggers additional disclosure requirements under the Truth in Lending Act for mortgage loans that bear fees above a certain amount. The adjustment is effective January 1, 2000.

November 3, 1999 - OCC Rule Changes Ease Burdens on Community Banks
WASHINGTON -- The Office of the Comptroller of the Currency (OCC) will issue final rules tomorrow codifying a number of interpretive letters that make it easier for community banks to satisfy certain corporate requirements under the National Bank Act. These changes are the most recent steps taken by the agency to reduce the regulatory burden on community banks.

November 3, 1999 - OCC Permits National Bank of Commerce Operating Subsidiary To Underwrite and Deal in Corporate Bonds and other Debt Securities
WASHINGTON -- The Office of the Comptroller of the Currency today approved an application permitting National Bank of Commerce, Memphis, to expand the activities of its operating subsidiary, NBC Capital Markets Group, Inc., to include corporate bonds and other debt securities. Attachment

November 3, 1999 - The Federal Reserve Board today announced a review of its publication activities.  Comment is requested by December 17, 1999.

November 3, 1999 - The Federal Reserve Board today published proposed revisions to the official staff commentary that applies and interprets the requirements of Regulation Z, Truth in Lending.  Comment is requested by January 10, 2000.  The proposed revisions address short-term cash advances commonly called "payday loans" and include technical revisions.

November 2, 1999 - The Federal Deposit Insurance Corporation (FDIC) is recommending higher capital requirements for insured banks and savings associations engaged in subprime lending.

November 1, 1999 - The Federal Deposit Insurance Corporation (FDIC) today released a list of orders of administrative enforcement actions taken against banks and individuals in September. No administrative hearings are scheduled for November.

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