Political

The election season is now beginning to take shape with the final results in the primaries.

In particular, focus is on the battle for the New York State Senate. A Siena Poll released September 28th targets several races of particular interest.

Senate Banking Committee Chair Brian Foley, in the 3rd Senate District in Suffolk County, holds a slim lead over his challenger, Republican Lee Zeldin, 44-43 percent, with 13% undecided.

Ranking Senate Banking Committee Chair Hugh Farley is facing an aggressive challenge from Schenectady County Democratic Legislative Chair Susan Savage. Farley leads by a 56-32 percent margin, with 8% undecided. The Democratic Senate Campaign Committee recently transferred almost $200,000 to Savage’s campaign.

There are a number of close races in the State Senate which could potentially result in a return to Republican control. This situation remains fluid and pundits predict it will go down to the wire. The Assembly, unlike the Senate, will certainly remain in Democratic control but there appear to be a few contested seats.

Municipal Deposits for Credit Unions

S.8296-C, sponsored by Senator Parker, which would permit credit unions to accept municipal deposits up to $250,000, remains on the Senate calendar ready for consideration when the Senate returns to Albany. Although there was some discussion by Governor Paterson about a pre-election session, that possibility is remote. Any action on this bill will be deferred until the Legislature returns post-election.

The IBANYS Board is examining the feasibility of a study to underline the negative impacts of extending municipal deposits to credit unions, especially in light of Dodd-Frank changes. This study would be a useful tool in deflecting many of the credit unions’ assertions made to the Legislature, as were apparent in the Credit Union Association of New York response to Bob Schick’s memorandum.

Credit Line Mortgage Extension Signed

An IBANYS priority, which was suggested by a member-bank, this bill extends the timeframe for continuation of a credit line mortgage from 25 to 30 years and was signed by the Governor as Chapter 529 of the Laws of 2010.

Insurance Companies to Invest in Credit Unions Signed

Despite opposition from IBANYS, legislation to amend the Insurance Law to allow insurance companies to invest in credit union share certificates was signed by the Governor as Chapter 461 of the Laws of 2010. This bill was supported by both the Credit Union Association of New York and the New York Insurance Association, Inc. Some cooperative and mutual insurers which were denied the ability to place funds in the credit unions by the New York State Insurance Department were supportive. The amount of funds the credit unions can accept from an insurer is capped at the amount insured by the National Credit Union Association.

Escrow Accounts

Peter Forrestel and Bob Fisher, both State Banking Board members, raised the issue of the 2% mandated interest rate for escrow accounts held for mortgage customers on taxes and insurance at a recent meeting with Superintendent Neiman. The Superintendent recognized the unfairness of this requirement in the current interest rate environment and pledged to work with IBANYS to adjust this rate requirement through a legislative proposal.

Home Office Protection

IBANYS has forwarded a memo to the Banking Department on their departmental bill (S.7445/A.10915), which would have considered ATMs as branches for the purpose of home office protection only if designated by the Banking Board. IBANYS is requesting that this provision be deleted from this legislation when re-submitted for the next legislative session.

Federal Home Loan Bank of New York Nominees

The Federal Home Loan Bank of New York will be distributing ballots to member banks on October 5, 2010. IBANYS Secretary David Nasca, President & CEO of Evans Bank, is a nominee. Please support your fellow IBANYS member by voting.

November 8th Board Meeting

The next IBANYS Board meeting is scheduled for November 8, 2010. If you have any suggestions for legislative or regulatory changes, please contact Bill Crowell. Karen Thomas, Senior Executive Vice President, Government Relations and Public Policy, at ICBA will be at the meeting so any comments on federal issues would be relevant and discussed with Karen.