On December 4, 2015, the President signed into law the Fixing America's Surface Transportation Act of 2015 (the "FAST Act" or "Highway Funding Act"). Although principally addressing highway funding, the law impacts the banking industry in the following ways:

• A greater number of community banks will be eligible for an 18-month examination schedule as opposed to the current 12-month schedule. This extension will become available to banks with total consolidated assets of less than $1 billion that are well-capitalized and well-managed with a composite condition of outstanding.

• Banks will be exempted from providing annual Gramm-Leach-Bliley Act ("GLB Act") privacy notices to their customers where: (i) the bank shares nonpublic personal information of its customers only in accordance with the exceptions provided for in Section 502(b)(2) and (e) of the GLB Act; and (ii) the bank has not changed its policies and practices since the most recent disclosure sent to the customer.

• The Consumer Financial Protection Bureau's (the "CFPB") process for establishing "rural" areas has been amended to provide an appeals process for "rural" area designations. Specifically, the CFPB is now to consider the rural designation of other federal agencies. This is significant as a "rural" area designation allows lenders to offer within those areas qualified mortgage loans with balloon payments and higher-priced mortgage loans that do not require an escrow account. This provision will expire two years from the Highway Funding Act’s effective date.

• The Truth in Lending Act has been amended to no longer require that lenders show they "predominantly" operate in rural or underserved areas (i.e., at least 50 percent of first-lien secured mortgages in those areas) in order to qualify for an exemption from qualified mortgage underwriting requirements. Lenders will now be required to show only that they actually operate in the respective rural or underserved area. This will enable more lenders to originate qualified mortgages with balloon loans and higher-priced mortgage loans that do not require an escrow account.

• Effective January 1, 2016, the Federal Reserve Bank annual dividend on paid-in capital stock held by Federal Reserve member banks with consolidated assets of more than $10 billion, adjusted for inflation, will be reduced to the high yield of the 10-year Treasury Note (currently yielding 2.22 percent as of December 8, 2015), with a ceiling of 6 percent. In addition, the Federal Reserve Bank annual dividend on paid-in capital stock held by Federal Reserve member banks with consolidated assets of less than $10 billion, adjusted for inflation, will remain unaffected and keep the currently capped annual dividend on paid-in capital stock of 6 percent.

• The Securities Exchange Act of 1934 has been amended to raise the thresholds for registration and deregistration of savings and loan holding companies. Specifically, the mandatory registration threshold is increased from 500 to 2,000 shareholders, and the deregistration threshold is increased from 300 to 1,200 shareholders. This amendment will serve to conform the registration and deregistration thresholds for savings and loan holding companies with the registration and deregistration thresholds applicable to bank holding companies under the Jumpstart Our Business Startups Act, which was passed in 2012.

• Privately insured credit unions will be permitted to become members of a Federal Home Loan Bank, provided that the appropriate state regulator having oversight authority for the credit union has determined that the credit union meets all the eligibility requirements for federal deposit insurance.