Top Story Compliance Related

The OCC has issued Bulletin 2017-24 announcing the issuance of a new "Branch Closings" booklet of the Comptroller’s Licensing Manual. The revised booklet:

• provides an overview of the requirements for a bank to provide the OCC and the customers of a branch a 90-day advance notice of a branch closing, and any exceptions that may apply.
• details the different requirements of a "branch closing" for a national bank or Federal savings association
• clarifies policies and procedures that a bank should follow if a branch must be closed temporarily due to an emergency or factors beyond the control of the bank
• lists references and links to informational resources and sample forms and documents that banks may find useful during the branch closing process

The Federal Reserve Board has released its annual determination of the aggregate consolidated liabilities of financial companies as required by section 622 of the Dodd-Frank Act. The act prohibits a financial company from combining with another company if the resulting company's liabilities would exceed 10 percent of the aggregate consolidated liabilities of all financial companies. Financial companies subject to the limit include insured depository institutions, bank holding companies, savings and loan holding companies, foreign banking organizations, companies that control insured depository institutions, and nonbank financial companies designated for Board supervision by the Financial Stability Oversight Council.

The CFPB published in today's Federal Register policy guidance concerning early compliance with its 2016 amendments to the Servicing Rules under Regulations X and Z. Responding to industry concerns about mid-week effective dates (both the October 19, 2017, and April 19, 2018, effective dates of the 2016 amendments fall on Thursday), the Bureau's guidance says the agency won't take action for violations of existing Regulation X or Regulation Z resulting from compliance with the amendments up to three days early. That will allow servicers to update their systems over the weekend prior to the effective dates, rather than mid-week.

The U.S. Department of the Treasury took multiple actions yesterday regarding North Korea. Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a finding that Bank of Dandong, a Chinese bank that acts as a conduit for illicit North Korean financial activity, is a foreign bank of primary money laundering concern, and FinCEN has proposed to sever the bank from the U.S. financial system. In addition, Treasury’s Office of Foreign Assets Control (OFAC) designated two Chinese individuals and one Chinese company in response to North Korea’s ongoing WMD development and continued violations of UN Security Council resolutions. See our OFAC Update for identification of the designated individuals and entity.

• Treasury Department press release
• FinCEN Notice of proposed rulemaking

The CFPB has published in today's Federal Register its previously-announced proposal to amend its Prepaid Rule. Comments on the proposal will be accepted through August 14, 2017.

The Federal Emergency Management Agency has published a final rule in today's Federal Register identifying communities that will be suspended from the National Flood Insurance Program on July 18, 2017, for noncompliance with the floodplain management requirements of the program. Listed communities include:

• California—portions of Mendocino County
• Maine—portions of Washington County
• Pennsylvania—portions of Fayette County
• South Carolina—Towns of Reevesville and Summerville

The FDIC has issued FIL-24-2017 on behalf of the Federal Financial Institutions Examination Council announcing yesterday's publication of a proposal to make additional burden-reducing revisions and certain other reporting changes to all three versions of the Call Report. The changes would take effect March 31, 2018. To assist financial institutions in understanding how the proposal would affect the three versions of the Call Report, redlined copies of the FFIEC 051, FFIEC 041, and FFIEC 031 report forms showing the proposed burden-reducing changes and equity securities revisions are available on the FFIEC's website (https://www.ffiec.gov/ffiec_report_forms.htm) on the web page for each report form.

The Bureau has released a special edition of its monthly complaint report containing a snapshot of consumer complaints received from each state and the District of Columbia. The report provides statistics on complaint volume, the products and services generating the most complaints, company response rates, and a look at complaints from servicemembers and older Americans. The report also gives a national overview and spotlights narratives submitted by consumers regarding their experience with the CFPB’s complaint process.

• CFPB press release

The Federal Reserve Board has announced a $3 million fine against Bank of New York Mellon Corporation (BNY Mellon) for unsafe and unsound accounting practices after the firm improperly assigned a lower risk weighting to a portfolio of assets, reducing the firm's risk-based capital ratios. BNY Mellon incorrectly assigned the assets a zero-risk weighting, which was improper under the rules in place at the time. As a result of its improper treatment of the portfolio BNY Mellon understated its reported risk-weighted assets and overstated its risk-based capital ratios for nearly 14 quarters. BNY Mellon took action to correct its risk-weighting and risk-based capital ratios when the errors were identified, and is now in compliance. For additional information, see "BNY Mellon fined $3 million for accounting error," in our Penalty pages.

The OCC, Federal Reserve and FDIC have published [82 FR 29147] the FFIEC proposal announced last week for streamlining the Call Reports for a bank with domestic offices only and total assets less than $1 billion (FFIEC 051), a bank with domestic offices only (FFIEC 041), and a bank with domestic and foreign offices (FFIEC 031). Comments are due by August 28, 2017.