Monthly Archives:' April 2015

Kennedy Sutherland Presents at Historic Tax Credit Workshop

The new Texas Historic Preservation Tax Credit has the potential to make a major impact on economic revitalization throughout our community and across our state. It offers wide-ranging opportunities for a diverse group of stakeholders, including developers, architects, realtors, urban planners, preservation consultants, nonprofits, investment firms, and local and state leaders and officials. Knowing how to navigate the program is key, though. This four hour workshop will focus on the nuts and bolts of the new credit, including what projects will qualify, who can take the credit, how the credit can be sold, and more. Our expert speakers will address the Federal Historic Tax Credit, New Market Tax Credit and other companion credits to illustrate how they can be combined. They will also present various projects and discuss their expectations for how the new state tax credit will function in the coming years.

FRIDAY, MAY 15
8AM-NOON
THE NORTH DOOR, 502 BRUSHY STREET, AUSTIN 78702

$50 GENERAL ADMISSION, $10 STUDENT ADMISSION

Speakers Include:

Sharon Fleming, Director of the Division of Architecture and Deputy State Historic Preservation Officer for the Texas Historical Commission.

Valerie Magolan, Rehabilitation Tax Credit Specialist for the Texas Historical Commission.

Ben A. Dupuy, President of St. Charles Avenue Advisors in New Orleans and an expert in tax credit syndication.

Hal Fairbanks, Vice President of Acquisitions for HRI Propertiesin New Orleans and an expert in community development through adaptive reuse.

Scot E. Butcher, Principal of Tax Incentive Finance, LLC and Tax Incentives Consultants, LLC and an expert in business incentives and public finance.

Patrick J. Kennedy Jr., Managing Partner of Kennedy Sutherland LLP in San Antonio and an expert in New Market Tax Credits.

This workshop is presented in conjunction with the Texas Historical Commission.

Policies Every Family Business Needs

Join Kennedy Sutherland attorney, Dub Sutherland, on Wednesday, May 20th, as he presents at Broadway Bank’s Family Resource Business Center luncheon on “Policies Every Family Business Needs.”  Mr. Sutherland will discuss the basic family business policies you should have in place like a shareholder’s policy. family employment policies, as well as policies that are trending such as risk management policies dealing with social media issues. Most importantly he will cover the process of getting these policies discussed, written down and approved while keeping the entire family involved and supportive!

Time: Wednesday, May 20, 2015 11:30 AM – 1:00 PM
Location:Charles Cheever Administration Building

Register Now, seating is limited.

Banking Regulatory Round Up April 2015

The U.S. House of Representatives this week passed five regulatory relief bills that help community banks.

The bills are:
Helping Expand Lending Practices in Rural Communities Act (H.R. 1259)
Reps. Andy Barr (R-KY) and Ruben Hinojosa (D-TX) have reintroduced this legislation that passed the full House in the last Congress. The bill would direct the CFPB to establish an application process under which a person who lives or does business in a state may apply to have an area designated as a rural area if it has not already been designated as such by the Bureau.

Eliminate Privacy Notice Confusion Act (H.R. 601)
This bill by Rep. Blaine Luetkemeyer (R-MO) would eliminate the annual privacy notice disclosure requirement for institutions that haven’t changed their policies.

Bureau Advisory Commission Transparency Act (H.R. 1265)
This bill by Rep. Sean Duffy (R-WI), would increase transparency in CFPB advisory council meetings.

SAFE Act Confidentiality and Privilege Enhancement Act (H.R. 1480)
This bill by Rep. Robert Dold (R-IL) would protect the confidentiality of information banks share with state regulators.

Mortgage Choice Act (H.R. 685)
This bill by Rep. Bill Huizenga (R-MI) would provide needed clarifications on the Qualified Mortgage rule’s points and fees test.

All of the bills were supported by the American Bankers Association.

Yellen Responds to Basel III Letter

Federal Reserve Chairman, Janet Yellen, declined to pursue a policy change that would solve a tax liability problem for Subchapter S shareholders should the bank’s capital levels fall below the Basel III capital conservation buffer. Basel III’s capital conservation buffer prevents banks from making distributions to shareholders when capital falls below a threshold — but because federal tax liability passes through a Sub S bank to individual shareholders, Sub S shareholders can face tax liability even when they have not received a distribution. This puts Sub S banks subject to the buffer at a disadvantage to C corporation banks, which pay any taxes due directly out of the bank’s income.

The Subchapter S Bank Association has sent letters and advocated for a solution to this along with many other banking associations. Yellen said, in a response to a letter sent in October 2014 from several House members urging a solution, that the Fed “continues to believe that the capital conservation buffer should be applied equally to all banking organizations.” In addition, “By holding more than 1.25 percent capital above the minimum regulatory capital requirement, a state member bank can distribute up to 40 percent of eligible retained earnings as dividends,” she wrote. “As a result, shareholders should be able to pay their tax liabilities under most circumstances.” Unfortunately, going forward the Federal Reserve plans on monitoring the effects of the revised capital rule throughout its implementation.

YellenSubSLetter.pdf

Regulatory Capital Rule's FAQs Released

Financial Institutions are accountable for complex risk-based regulatory capital rules. Some may use internal risk management models approved by the relevant regulator while others must use standardized rules set out in the regulations. On April 6th, The Federal Reserve, Office of the Comptroller of the Currency and the Federal Deposit Insurance Corporation (the agencies), issued FAQs for clarification for regulated institutions about the agencies’ regulatory capital rule. The FAQ topics included, but are not limited to:

  • The definition of capital,
  • High-volatility commercial real estate (HVCRE) exposures,
  • Real estate and off-balance-sheet exposures,
  • Equity exposures to investment funds,
  • Qualifying central counterparty, and
  • Credit valuation adjustment.

Reserve Banks are asked to distribute the FAQs to the state member banks, bank holding companies, and relevant savings and loan holding companies in their districts and to appropriate supervision staff.  As the agencies anticipate issuing additional FAQs in response to questions from institutions, the Federal Reserve will periodically update the FAQ document.

Kennedy Sutherland Presenting at Bank Holding Company Association Seminar

Join Kennedy Sutherland attorneys, Patrick J. Kennedy Jr. and Dub Sutherland, as they present at the 2015 Bank Holding Company Association Spring Seminar in Bloomington, Minneapolis on May 4th, 2015. The seminar will “Build on a Foundation of Success,” giving financial institutions the information & networking opportunities they need to take their bank holding company to the next level. The seminar is bigger & better than ever with an expanded Monday session, more breakout sessions, & outstanding speakers.

This year Kennedy Sutherland will be part of a new special two-part session that will look at the current issues affecting Sub S banks and holding companies, and investment strategies designed to make the most of a sub S election.

AGENDA

MONDAY, May 4, 2015

2:30 p.m. ~ Registration Desk Opens

3:00 p.m. to 4:00 p.m. ~ “Sub S Issues & Opportunities”
Kevin Powers of Crowe Horwath, LLP, will look at the current issues facing holding companies and banks incorporated under subchapter S rules and compare C vs. S in the current tax environment.

William D. “Dub” Sutherland of Kennedy Sutheland LLP will discuss challenges and opportunities in managing Sub S shareholders, Board and Bank, including specific thoughts on succession planning.

4:00 p.m. to 5:00 p.m. ~ “How to Leverage Your Sub S Election”

Randy Rouse, executive vice president and chief investment officer of Broadway Bank, will share his bank’s investment strategy for making the most of its S election. Broadway is a $2.4 billion community bank in San Antonio, Texas. He is a regular presenter at the annual conference of the Subchapter S Bank Association and is making his first BHCA seminar presentation.

Patrick Kennedy, Jr. of Kennedy Sutherland LLP will provide the most current update on legislative and regulatory matters affecting Subchapter S banks, including discussion of the Association’s Capital Access Initiative as well as other legislative opportunities.

5:00 p.m. to 6:30 p.m. ~ Reception

6:30 p.m. to 7:30 p.m. ~ Dinner

7:30 p.m. to 8:30 p.m. ~ “Eyeing Rates and Other Economic Indicators”

Economist Edmund Seifried will survey the economic landscape, identifying the areas of potential trouble and opportunity for community bank owners. Seifried is the chief economist of the Sheshunoff Affiliation Programs and serves on the faculty of several banking schools.

View the Full Agenda

Register Now