Monthly Archives:' April 2016

Sutherland to Present at Texas Rural Challenge

Kennedy Sutherland attorney, Dub Sutherland, is honored to present at the 17th Annual Texas Rural Challenge Conference “Small Towns Big Ideas” which is being held in Waco, Texas on June 9-10. Other speakers at the conference included representatives from the governor’s office and the Texas Workforce Commission, as well as mayors, county judges, city managers and economic development directors from rural areas. Notable keynote speakers included Agriculture Commissioner Sid Miller and Texas Secretary of State Carlos Cascos.

The Texas Rural Challenge conference is organized annually by the University of Texas at San Antonio Rural Business Program, which is part of the Small Business Development Center network. The Small Business Development Center network focuses on providing assistance to small businesses and works with local leaders in typically underserved cities and towns in Texas to create revitalization strategies intended to increase economic opportunity and improve the quality of life in rural communities. At the conference Mr. Sutherland will discuss opportunities by utilizing state and federal tax credits for many small businesses who remain challenged by a lack of capital and the ability to build assets. Other panelist joining Mr. Sutherland on the Innovative Financing for Public and Private Projects at the Texas Rural Challenge Conference include:

  • Amber Howard, US EPA Region 6
  • Bill Cummings, The P4 Group
  • Sheri Woodsgreen, The P4 Group
  • JD King, BBVA Compass

Increase Asset Threshold Under Small Bank Holding Company Policy Statement

On April 14, 2016, the House of Representatives passed H.R. 3791 with a vote of 247-171. Introduced by Congresswoman Mia Love (R-UT-04) and passed out of the Financial Services Committee, HR 3791 requires the Federal Reserve to increase the consolidated asset threshold under the Small Bank Holding Company Policy Statement to $5 billion from $1 billion. If enacted into law, institutions of up to $5 billion in total assets would be able to increase their use of debt to raise bank capital, repurchase stock, or make acquisitions. In addition, consolidated capital rules do not apply and capital adequacy is judged at the bank level only. Qualifying institutions would be prohibited from engaging in any non-banking activities involving significant leverage and may not have a significant amount of outstanding debt that is held by the general public. The bill next goes to the Senate.
While 90% of  S corp holding companies have total assets of  less than $1 billion in total assets, passage of this bill could have a significant impact on the ability of those in the $1 – $5 billion asset range to raise capital and to expand. Please let us know if this is important to your institution.

Text of HR 3791

Congresswoman Love’s remarks on the legislation

FDIC Rescinds De Novo Time Period

The Federal Deposit Insurance Corporation (FDIC) on April 6th rescinded Financial Institution Letter (FIL) 50-2009, Enhanced Supervisory Procedures for Newly Insured FDIC-Supervised Depository Institutions.

The FIL, among other measures, extended the de novo period for newly organized, state nonmember institutions from three to seven years for examinations, capital maintenance, and other requirements. It was issued as a result of an elevated number of newly insured institutions that had either failed or had been identified as problem banks during the financial crisis of the last ten years.

Since the issuance of the guidance, the FDIC adopted regulations and guidance that apply to all supervised institutions to strengthen their resiliency and risk-management practices. Further, the FDIC has enhanced its programs and procedures through a more forward-looking approach to supervision. Collectively, the processes and guidance address the supervisory objectives of the 2009 FIL.

FDIC Chairman, Martin J. Gruenberg recently said, “The entry of new banks has helped to preserver the vitality of the community banking sector over time. De novo institutions fill important gaps in our local banking markets, providing credit and services to communities that may be overlooked by larger institutions. The FDIC welcomes applications for deposit insurance.”

In addition, the FDIC issued FIL-24-2016 to provide guidance in the form of supplemental “Questions and Answers” (Q&As) to aid applicants in developing proposals for deposit insurance. The supplemental Q&As, which address business planning, provide additional transparency to the application process and supplement the guidance issued November 20, 2014, through Financial Institution Letter (FIL) 56-2014.

Supplemental Guidance


ICBA’s statement of FDIC’s New De Novo Policy