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Media Mentions – August 1, 2014

Media Mentions – August 1, 2014

August 4, 2014

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent mentions of Financial Institutions group attorneys include:

Jerry Blanchard in the Atlanta Journal-Constitution

Atlanta Partner Jerry Blanchard was quoted July 18 by The Atlanta Journal-Constitution on reasons behind the shrinking number of banks in Georgia. The state, which led the nation in bank failures stemming from the real estate bust, has seen an increase in the number of banks being bought up at a rate of about one a month as healthy banks grow through the acquisition of other healthy banks. Blanchard said the question on many bankers’ minds is, “Can you survive the recovery? It’s hard to make money.” Click here to read the full article.

Rob Klingler in American Banker

Atlanta Partner Robert Klingler was quoted July 1 by American Banker concerning the trend among trust-preferred creditors of telling deadbeat banks that they must negotiate repayment or be forced into liquidation. Trapeza Capital Management filed legal documents recently to force FMB Bancshares in Lakeland, Ga., into involuntary bankruptcy. Trapeza, which manages a collateralized-debt obligation containing FMB’s trust-preferred securities, said in its filing that it is owed $13.6 million in unpaid debt and interest. FMB is the second lender to face involuntary bankruptcy over unpaid trust-preferred dividends. “Involuntary bankruptcies send a clear signal that doing nothing does not appear to be a good strategy,” Klingler said. “When you’re in default and tell your creditors you can’t do anything, you’re asking for an involuntary bankruptcy.”

Walt Moeling in SNL Financial

Atlanta attorney Walt Moeling was quoted July 10 by SNL Financial regarding the increase in bank M&A in Georgia this year. These recent transactions are simply logical, said Moeling, who noted that acquirers today have excess capital and outstanding commitments to put those funds to work, and they often are looking to rationalize fragmented franchises. Moeling agreed buyers are becoming more assertive and attributed some of the increased confidence to the fact that potential sellers are sitting on firmer ground. “They’re picking up a much smaller amount of problem assets and so there is a willingness to be a little more aggressive in doing acquisitions and again that’s only logical,” he said.

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Media Mentions – June 6, 2014

Media Mentions – June 6, 2014

June 6, 2014

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent mentions of Financial Institutions group attorneys include:

Walt Moeling in American Banker

Walt Moeling was quoted May 8 by American Banker concerning an uptick in interest from outside investors in the Florida banking industry.  A number of banks in the Midwest and elsewhere poured money and resources into Florida a decade ago, only to absorb large losses when the housing market collapsed.  “That was an interesting phenomenon,” Moeling said.  “The theory is that Florida has good deposits and is a good growth market . . . But those who fail to learn from history are doomed to repeat it.  The truth of the matter is it is very hard to be successful in a totally different market where you don’t have a lot of experience.”

Judith Rinearson and John ReVeal in Pay Magazine

Judith Rinearson and John ReVeal authored an article for the spring edition of PayBefore’s Pay Magazine  concerning the importance of crafting agreements between banks and their third-party vendors that will withstand the scrutiny of regulators.  “Recent regulatory publications, examinations and enforcement actions suggest that the standards and expectations by which regulators evaluate banks’ third-party relationships now are significantly more exacting,” they wrote.  “They’re digging deeper on how banks select their third-party vendors, and the scope of their review is extending to more and more vendors. This increased focus makes it critically important for banks and their partners to get their relationships right from the start by setting their own appropriate expectations and establishing standards for oversight, access and follow through.  And, the contract is the key.  Click here to read their full article.

Margo Strahlberg in Paybefore News

Margo Hirsch Strahlberg was quoted April 29 by Paybefore News regarding a qui tam action involving the state of Delaware relating to claims that nearly two dozen well-known retailers avoided escheating unused gift card balances to the state through the use of special purpose entities organized in other states. Delaware law enables the state to collect unclaimed property, including gift card funds that have gone unused after five years, from companies incorporated in the state. Strahlberg said Delaware’s pursuit of legal action in this case doesn’t mean other states will follow the strategy of seeking court intervention. “The states will still continue to pursue legislation in their attempt to grab at unclaimed funds,” she told the publication. “Delaware always has been known as an aggressive state with respect to unclaimed property, so its willingness to rely on the courts comes as no surprise.”

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Media Mentions – April 25, 2014

Media Mentions – April 25, 2014

April 25, 2014

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news. Recent mentions of Financial Institutions group attorneys include:

Rinearson in AFP Exchange

New York Partner Judith Rinearson authored an article on the future of bitcoin and virtual currency for the April edition of AFP Exchange magazine, by the Association for Financial Professionals. Her article was part of the publication’s annual payments issue. “Can virtual currencies be regulated in a manner that protects consumers, merchants, our payment systems and national security, while at the same time not ‘killing the golden goose’ through overly burdensome or unfeasible regulatory requirements?” Rinearson wrote. “I believe the answer is yes….However, such regulation should be imposed with a light hand and reasonable steps must be taken quickly.”

Shumaker in Bank Safety & Soundness Advisor

Atlanta Associate Michael Shumaker was quoted extensively April 14 by the Bank Safety & Soundness Advisor concerning top misconceptions in vendor management. After all the talk from regulators over the growing risks and expectations of managing third-party relationships, some banks still seem to think the guidance does not apply to them. “Probably the most important thing for banks to recognize is that things have changed, and that the regulatory expectations of banks with respect to the integration of risk associated with vendor contracts, those expectations have changed,” Shumaker said. “You can outsource the activity, but you cannot outsource the risk. Banks need to recognize that having a vendor conduct the activity does not change their obligation to manage the risk of the activity.”

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Media Mentions – February 28, 2014

Media Mentions – February 28, 2014

February 28, 2014

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent mentions of Financial Institutions group attorneys include:

BankBryanCave.com in Banking and Finance Law Daily

Three recent blog posts from BankBryanCave.com were prominently featured Feb. 13 in Banking and Finance Law Daily. The publication’s “Blog Tracker” column, which highlights the week’s “most insightful, intriguing or entertaining blog posts from the banking and financial services community,” included our recent posts “Will 2014 be the year of UDAP and UDAAP?” by DC Partner John ReVeal and Associate Seyi Iwarere; “Should your bank do business with Bitcoin?” by DC Associate Courtney Stolz; and “Five practical tips to manage your vendor risk…,” by Atlanta Associate Karen Neely Louis  Click the post titles to read more.

Klingler in American Banker

Atlanta Partner Rob Klingler was quoted Jan. 28 by American Banker concerning Broadway Financial, which has struggled in recent years but managed to restructure its debt and recapitalize by bringing together the federal government, private equity, nonprofits and local banks. Today, the U.S. Treasury owns 52 percent of Broadway, or about $8.8 million in common stock. Broadway is one of five companies with common stock held by the Treasury as a result of a Tarp exchange, and is the only one majority owned by the government. Klingler said the Treasury typically moves quickly to cash out of such holdings. He said the stake is unlikely to scare off investors (the Treasury has vowed to be hands-off and vote along with the majority) but the government could have trouble finding investors to buy such a large block of shares.

Shumaker in Bank Safety & Soundness Advisor

Atlanta Associate Michael Shumaker was quoted at length in two front-page articles Feb. 17 in Bank Safety & Soundness Advisor concerning third-party vendor risk. Regulators are pushing for higher third-party due diligence standards, particularly the Office of the Comptroller of the Currency (OCC), which now requires banks to manage what it calls the full “life cycle” of a vendor relationship. “The regulators’ expectations are on a sliding scale,” Shumaker said. “The level and depth of risk management and vendor management for a $50 billion bank is not going to be expected necessarily for a $100 million bank.” A small community bank, he explained, may only have one or two material contracts that it needs to be on top of, such as for data processing and a credit or prepaid card program. Still, he said, having a “rational and structured” approach for entering those contracts not only keeps regulators happy but makes business sense.

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Media Mentions – January 31, 2014

Media Mentions – January 31, 2014

January 31, 2014

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent mentions of Financial Institutions group attorneys include:

Rob Klingler in Bank Safety and Soundness Advisor

Atlanta Partner Robert Klingler was quoted Jan. 27 by Bank Safety and Soundness Advisor concerning an eagerly awaited amendment to the Volcker Rule, which will exempt most bank-issued Trust Preferred Securities (or TruPS). The interim final rule, however, does not exempt insurer or REIT-backed TruPS. Klingler said the exemption does not include insurer and REIT TruPS because the Collins Amendment didn’t either, and regulators modeled the Volcker exemption after the Collins Amendment. “They were looking to the Dodd-Frank Act itself for the statutory authority,” he said. “They used the Collins Amendment to form the basis for why they’re able to exempt [these TruPS]. They don’t have a statutory basis for excluding insurer-backed TruPS. They probably wanted to make sure the final rule wasn’t going to be challenged. The way to do that was to lock in the $15 billion bank asset threshold.”

Judith Rinearson in Multiple Outlets

New York Partner Judith Rinearson was quoted a number of times recently in connection with hearings in New York on the future of virtual currency, including the popular Bitcoin. She was quoted Jan. 28 by The Verge, Inc. magazine and IDG News Services (in an article that ran in IT World and CFO World) and Jan. 27 by Upstart Business Journal. Rinearson acted as an expert witness at the hearings, which could lead to the creation of “BitLicenses” to allow the introduction of Bitcoin ATMs and other Bitcoin-related startups in New York. “New York has always been one of the lead states when it comes to money transmitter licenses,” said Rinearson, who is also regulatory counsel for the Network Branded Prepaid Card Association and serves as chair for the association’s Government Relations Working Group. “But I think a lot of other states are going to be watching and a lot of states will be waiting to see what happens.”  Click here to read the full Upstart Business Journal article.

Dan Wheeler in Financial Services Publications

San Francisco Partner Daniel Wheeler authored an article for the January edition of Western Independent Bankers’ Lending & Credit Digest on common regulatory errors in making a commercial loan. Lenders often ignore or misunderstand several regulations and other laws that affect the origination of a commercial loan. Wheeler’s article discussed some surprising aspects of bank regulations and laws that can catch a commercial lender by surprise and result in a compliance violation.  Click here to read the Lending & Credit Digest article.  Dan authored an article for the January edition of Western Independent Bankers’ Directors Digest regarding current opportunities and regulatory issues related to common non-interest income opportunities, including overdraft protection.  Click here to read the Directors Digest article.  Dan also authored a lengthy article for the December edition of Banking & Financial Services Policy Report on basic interest rate swaps, which he said remain a viable and necessary tool for small community banks.  “Despite Congress’ and the regulators’ enactment of thousands of pages of burdensome and frequently counterproductive swap regulation, community banks still have compelling reasons to offer swap capability to their customers,” he wrote.  “Community bank management need not become experts in swap accounting or regulation; they merely need to understand the risks and strategy involved in the swaps they offer.”

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Media Mentions – December 6, 2013

Media Mentions – December 6, 2013

December 6, 2013

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent Media Mentions of Financial Institutions Group attorneys include:

Katherine Koops in Western Independent Banker

Atlanta Counsel Katherine Koops authored an article for the November/December edition of Western Independent Banker regarding the Federal Reserve Board of Governors’ approval of a final rule implementing the Basel III higher minimum capital standards for most banking organizations.  Click here to read her full article on the new capital rules.

Walt Moeling in American Banker

Atlanta partner Walt Moeling was quoted Nov. 27 by American Banker concerning the recent acquisition of Freedom Bank by Heartland Financial USA. Executives at Heartland have remained vague about their reason for the acquisition, but observers say it seems like a trade-off. River Valley Bancorp, the former owner of Freedom, may have used it as payment of a debt to Heartland. If Heartland did take a bank as payment, it may have been a good move because it is dealing with a multibank holding company rather than stakeholders like the Treasury Department or the holders of trust-preferred securities. “It can be an easy way to resolve a debt,” Moeling said. “But when you are dealing with a one-bank holding company, that is all there is, so there is not a lot of room to negotiate. … This also sounds like a cleaner situation – when you throw in Tarp or trups and try to strike a three- or four-way settlement, oh my God, it gets difficult.”

Michael Shumaker in Bank Safety & Soundness Advisor

Atlanta Associate Michael Shumaker was quoted Nov. 4 by the Bank Safety & Soundness Advisor on new third-party vendor guidance from the Office of the Comptroller of the Currency (OCC). The OCC recently published a detailed overhaul of its 12-year-old guidance on third-party relationships, significantly raising expectations for community banks and other institutions while reflecting heightened regulatory concern over the risks that the relationships pose. “The sound of this tome hitting the desk should alert banks and thrifts to the increased regulatory expectations for vendor management,” Shumaker said. “Banks should understand the increased diligence required to manage their third party risk in a safe and sound manner. “Regulators have seen bad performances by vendors during the crisis that increased the risk profile of banks. Now, banks should take a more critical look at their vendor relationships and work to move or re-negotiate the related contracts, when up for renewal, to comply with the guidance.”

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Media Mentions – October 4, 2013

Media Mentions – October 4, 2013

October 4, 2013

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave often makes the news.  Recent media mentions of Financial Institutions Group attorneys include:

Rob Klingler in Dow Jones Daily Bankruptcy Review

Atlanta Partner Robert Klingler was quoted Sept. 26 in the Dow Jones Daily Bankruptcy Review concerning what happens when TARP recipients file for bankruptcy. Congress authorized the U.S. Treasury Department to spend more than $200 billion nationwide as part of the Troubled Asset Relief Program five years ago. Overall, taxpayers profited from the program. But a review of the bankruptcies of TARP recipients shows that Treasury is likely to write off about $2.8 billion invested in banks now filing for bankruptcy. “Any time you make an investment, it’s a risk-reward exchange. The only way you get any reward is to take on risk,” Klingler said. “That means some of the investments aren’t going to work out, and some of the investments didn’t work out.”

Dan Wheeler in Directors Digest

San Francisco Partner Daniel Wheeler published an article in the October edition of Directors Digest regarding the heightened due diligence and oversight requirements regulators are enforcing on banks and their service providers. Wheeler’s article details specific steps banks should take in evaluating and entering into a new relationship as well as best practices in ongoing oversight and accountability. “Regulators have clear expectations about what a bank will do to oversee its existing and ongoing service providers,” he wrote. “Although a few types of providers have gotten the most regulatory attention recently, the guidelines apply across the board to all types of third-party service providers.”  Click here to read his full article.

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Media Mentions – July 2013

Media Mentions – July 2013

July 31, 2013

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent Media Mentions of Financial Institutions Group attorneys include:

Jerry Blanchard in Daily Report

Atlanta Partner Jerry Blanchard was featured July 5 in the Fulton County Daily Report for his hobby of ice climbing. Blanchard generally takes one ice climbing trip a year and has climbed Montmorency Falls near Quebec, ice walls in Banff National Park in Canada, and the Grand Teton and Mt. Moran in Wyoming, among other places. “The interesting thing for me about ice climbing is how it clears your mind,” he told the publication. “When you are on the ice, all other thoughts are pushed from your mind. You focus on where the next ice axe placement is going to be or whether the ice crampons have pushed far enough into the ice.”

Judith Rinearson in New York Times

New York Partner Judith Rinearson was featured July 11 in The New York Times regarding a group of senators who are asking regulators to examine the use of prepaid cards in place of paychecks. Across the country, a growing number of companies are doing away with paper paychecks or direct deposit and instead offering prepaid cards. But critics say using the cards can generate fees. “We strive to ensure we set a high bar with our best practices for our members,” said Rinearson, a lawyer with the Network Branded Prepaid Card Association, a trade group that represents the prepaid industry.  Click here to read the full article.

Dan Wheeler in American Banker

San Francisco Partner Dan Wheeler was quoted June 11 by American Banker concerning the mandatory hike in dividend payments on Troubled Asset Relief Program (TARP) preferred stock for banks that are set to hit their fifth anniversaries. Those dividend payments are scheduled to jump to 9 percent from 5 percent. Many observers fear the higher dividend could motivate banks to stop making quarterly payments or cause more bank sales. Banks that owe TARP funds “unfortunately, with some exceptions, tend to be the weaker banks,” Wheeler said. Banks that are “on the edge already…may decide to forgo” these higher payments. Wheeler also was quoted May 7 by American Banker on a push by private student lenders for permission to be more forgiving of recent college graduates who are having trouble repaying their loans. Under current rules, banks could risk examiners classifying such loans as troubled debt. That accounting designation can lead a bank to set aside bigger loss reserves, which reduces earnings. “So it shifts the key metrics on a bank balance sheet the wrong way, if you’re in management,” Wheeler said.

 

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Media Mentions – May 15, 2013

Media Mentions – May 15, 2013

May 15, 2013

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan Cave attorneys are often quoted in the news.  Recent Media Mentions of Financial Institutions Group attorneys include:

Walt Moeling in American Banker

Atlanta Partner Walt Moeling was quoted May 15 in American Banker regarding last-minute legal tactics by Central Arizona Bank to buy it a few extra days before being taken over by the Arizona Department of Financial Institutions. Moeling said maneuvers to stop regulators from shutting a bank are rare and rarely successful. “We’ve looked many a time for a way to delay it, and you may find a local judge who is willing to sleep on it,” Moeling said. “You know the failure is coming, you’ve been looking for capital, but there is not a thing you can do about it.”

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Media Mentions – April 15, 2013

Media Mentions – April 15, 2013

April 15, 2013

Authored by: Bryan Cave

With attorneys and staff worldwide, Bryan cave attorneys are often quoted in the news.  Recent Media Mentions of Financial Institutions Group attorneys include:

Kristine Andreassen in PayBefore

DC Associate Kristine Andreassen was quoted April 2 by PayBefore concerning a new anti-money laundering rule under consideration that would require consumers to report when they transport prepaid cards, along with cash and other monetary instruments, with a value of more than $10,000 into or out of the country. Andreassen said the rule would be relatively easy to get around, as most incidents of prepaid cards being used for cross-border money laundering likely have involved cards that have little or no value when they cross the border but are loaded once they reach their destination. “[Regulators] are focusing on card balance, but anyone trying to launder money will quickly learn to send cards with a zero balance,” she said. “So the rule is only going to ensnare the innocent.”

Walt Moeling in American Banker

Atlanta Partner Walt Moeling was quoted April 15 in two American Banker articles. Moeling was quoted regarding the Office of the Comptroller of the Currency’s bid for more power to issue sanctions directly against independent contractors, who often are hired by a bank under an enforcement action. “To me, the whole thing about the consultants is just more scapegoating,” Moeling said. “I tell my clients all the time that I’m a consultant but I’m not a banker. I can’t run it. You’ve got to run it.” He also was quoted April 15 on the drop in the number of enforcement actions levied against banks. Banks “are not encountering the early stage ferocious regulators,” Moeling told the publication. In addition, Moeling was quoted April 1 by American Banker concerning the proposed Bank of Bird-in-Hand. Eighteen investors, many of them Amish, are asking regulators for the OK to open what would be the first de novo bank in the U.S. in more than two years. Moeling said as the economy improves, the banking climate will, too. “I say that because it always has, even though everybody said it never would,” he told the publication.  Click here to read the April 1 article.

Judith Rinearson on NBC’s Today.com

New York Partner Judith Rinearson was quoted April 17 by NBC’s Today.com on the rising popularity of prepaid debit cards. Proponents say they are a better way to manage your money and a smart alternative to checking accounts: With a prepaid card there’s no credit check, no minimum balance and you can’t spend more than you load on the card. However, some fear they may not provide the same level of protection against loss or fraud. “You get the same fraud protection as with any other debit card,” Rinearson explained, saying Visa, MasterCard, American Express and Discover all have zero-liability policies if the card is lost, stolen or misused.  Click here to read the full article.

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