Independent Banker - September 2021 - 56

The ECORA Act
ICBA supports
the Enhancing
Credit
Fair lending and consumer protection
Under
President
Biden,
Opportunities in
Rural America
(ECORA) Act of
2021 (H.R. 1977
and S. 2202).
This bipartisan
legislation,
introduced in
March, would
create tax
incentives for
ag and rural
residential
lending. The
bill's provisions
would exempt
from taxation
interest on
loans secured
by agricultural
real estate and
income from
rural residential
mortgages in
communities
of fewer than
2,500 people.
" ECORA is
about increasing
a community
bank's ability
to serve more
farmers,
ranchers
and rural
homeowners by
providing them
lower interest
rates and better
lending terms, "
Stetter says.
regulators have clarified
the sex discrimination
prohibition under
the Equal Credit
Opportunity Act (ECOA)
and Regulation B. That
definition now includes
discrimination associated
with sexual orientation,
gender identity, an
applicant's social or
other associations, and
actual or perceived
nonconformity with
traditional gender- and
sex-based stereotypes.
" However, such data for
loans isn't something
that's always available or
clear, " says Lilly Thomas,
ICBA executive vice
president and senior
regulatory counsel.
Biden in January issued
an executive order
directing the Department
of Housing and Urban
Development (HUD) to
explore the impact of
the " disparate impact
standard " rule that the
Trump administration
instituted in 2020. HUD
then issued a proposal
to return the disparate
impact standard to the
standards set under the
Obama administration.
Thomas says this will
likely result in more
scrutiny on the impact of
bank loan portfolios.
Per requirements in
Dodd-Frank Section
1071, the CFPB under the
Trump administration
began developing
reporting requirements
on small business lending
that are similar to those
required by the Home
Mortgage Disclosure
Act (HMDA). In
2020, the agency
outlined narrower
thresholds for
reporting HMDA
data. Now, under
Biden, Thomas
anticipates these
thresholds are
" going to be
broadened or
[become] more
onerous, covering
Reporting " tax cheats "
President Biden's financial year 2022 budget includes enhanced tax
reporting for financial institutions in an aim to catch customers who
are " tax cheats, " Cooney says. The proposal would require banks to
report all account inflows and outflows to the IRS annually.
" We strongly oppose this, " he says. " It's another compliance burden for
community banks. We also don't want banks to come between their customers
and the IRS. It would harm customer relationships. "
According to Stetter, it would be very difficult for banks to administer. " It's
not appropriate, " he says. " If the IRS wants to go after tax cheats, they should
do it themselves. "
the greatest number
of banks. "
Regulators are placing
more emphasis on the
inclusion of unbanked
and underbanked
communities. " We're
seeing some pilot
programs from the
FDIC, some voluntary
programs and initiatives,
but it could change to
mandates, " Thomas says.
" Maybe [mandates for]
a barebones account
with little or no fees for
services [or] things that
encourage unbanked
and underbanked
individuals to open an
account at a bank. "
56 Q ICBA Independent Banker Q September 2021
Independent Banker - September 2021

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