ANNUAL REPORT
2013
FSR STANDS ASTRIDE THE INTERSECTIONS OF THE ENTIRE INDUSTRY, A POWERFUL VOICE ON THE ISSUES THAT MATTER TO EVERY SECTOR OF FINANCIAL SERVICES – AND TO THEIR CUSTOMERS.
ANNUAL REPORT
2013 WELCOME 4 ABOUT FSR
6
THE NEW FSR
8
FSR ACCOMPLISHMENTS
10
FSR BY THE NUMBERS
16
FSR FINANCES
18
FSR TEAM
20
NEW SENIOR STAFF
22
FSR BOARD OF DIRECTORS
24
FSR MEMBERS
28
LOOKING AHEAD
32
A
m e ssag e f r o m
FSR CEO
and
2013 FSR C h a i r m a n
WELCOME A message from FSR CEO and 2013 FSR Chairman: 2013 was an exciting year of change, transition and renewed energy at FSR. On the heels of our 100th Anniversary, FSR launched a top-tobottom revitalization effort, Project Renew, to better meet the needs of our members in today’s environment, particularly in Washington, D.C. Project Renew helped us achieve greater focus, and it will increase our ability to be effective on your behalf. Moving forward, FSR will focus on issues that impact the entire financial services industry. Moreover, we will dedicate our energies where the industry overlaps in these four core areas of member business activity: (1) investment management; (2) risk management; (3) payments; and (4) lending and leasing.
4 | FSR Annual Report 2013
We also launched a first-ever account management process that allows FSR staff to better understand and represent each member company. FSR has also made several exciting new hires, adding vital expertise to our government affairs, regulatory and communications teams. On the policy front, we made significant progress toward the renewal of the Terrorism Risk Insurance Act, a piece of legislation that many of you consider vital to the future of your business should disaster strike. Despite strong opposition from some political leaders, our advocacy work on cybersecurity helped secure the passage of bipartisan information sharing legislation in the House,
TIM PAWLENTY President & CEO
a step toward securing our industry’s business in an increasingly insecure world. Finally, our interactions with regulators kept our industry’s voice in the forefront as a flurry of new, complex Dodd-Frank rules were released and implemented. As we look ahead to 2014, a transformed FSR is poised to promote sound economic policy as well as the safety and security of the nation’s financial services system; helping to support our members, their customers they serve and the nation’s economy. Thank you for your continued support,
JOHN G. STUMPF Chairman, President and CEO, Wells Fargo & Company, Outgoing FSR Chairman
Tim Pawlenty, President and CEO of the Financial Services Roundtable
John Stumpf, Chairman, President and CEO, Wells Fargo & Company, Outgoing Chairman of the Financial Services Roundtable
5
A b o u t FSR
ABOUT FSR Who We Are: The Financial Services Roundtable is the leading advocacy organization for America’s financial services industry. With a 100 year tradition of service and accomplishment, FSR is a dynamic, forward-looking association advocating for the top financial services companies, keeping them informed on the vital policy and regulatory matters that impact their business. FSR members include the leading banking, insurance, asset management, finance and credit card companies in America. We are financing the American economy, creating jobs, expanding businesses, driving economic growth, and helping Americans in their daily lives by planning for retirement, insuring against disaster, and financing purchases large and small. As Washington expands its involvement in our industry, forming relationships and engaging with public officials and policymakers is critical to helping our members see around the curve, understand policies and regulations, and provide timely input to help shape decision making.
6 | FSR Annual Report 2013
FSR is a CEO driven association, giving us a unique and influential voice in Washington. At every level of the government, FSR is working to ensure that our members’ interests are well represented.
FSR Leadership: FSR CEO Tim Pawlenty brings dynamic leadership and vision to Washington on behalf of our members. As a former two-term Governor of Minnesota, he is an executive with extensive financial experience overseeing a $50 billion biennial budget, 30,000 employees and more than 20 state agencies and departments. As chair of the State Board of Investment, Governor Pawlenty oversaw more than $60 billion in investments. A former Presidential candidate, Governor Pawlenty is nationally respected as a serious policymaker who combines his depth of knowledge with a unique ability to communicate complex issues effectively. His recognition as one of the foremost thought leaders in the country brings credibility to FSR’s messages, our members and the industry.
How We Serve: FSR is positioned at the intersections of the financial services industry, focused on business activities common among members.
FOCUS
ADVOCACY
RESULTS
FSR specializes and leads on the issues at the intersections of the financial services industry, while playing a more supportive role on sector-specific priorities. FSR blends policy expertise, strategic communications and the right networks to make us powerful advocates in Washington. FSR delivers value and impact by approaching its agenda strategically, leveraging the strength of our combined members, building coalitions with like-minded stakeholders and targeting resources to drive results. 7
Project Renew
THE NEW FSR 1
3
INVESTMENT MANAGEMENT
PAYMENTS
In 2013, we initiated a strategic review of FSR in an effort to assess and redefine our existing business strategy and services to meet and exceed member needs and expectations. FSR engaged consultants from Allstate’s Organization Effectiveness & Management Consulting teams to assist us in performing this review. The results demonstrated many ways in which FSR could improve the membership experience, including the adoption of a business based activity strategy, bringing clarity to our mission and positioning FSR at the nexus of the financial services industry where companies from different sectors align.
8 | FSR Annual Report 2013
RISK MANAGEMENT
LENDING & LEASING
2
4
FSR moved rapidly to rapidly implement the new strategy in fall of 2013: • Established Subject Matter Expert Teams responsible for better understanding member activities and issues in more depth and with greater strategic focus. • Restructured the staff and budget to upgrade talent and realign resources to significantly enhance advocacy. • Overhauled FSR’s communications department and operations, leading to a significant increase in substantive media hits, social media presence, and rapid response. • Improved member relations and service by establishing Account Managers to act as primary points of contact for members to ensure they receive service and information from FSR at the level desired.
SUBJECT MATTER FOCUSES INDUSTRY-WIDE ISSUES Advocates on core issues that apply across FSR’s membership, including cybersecurity, trade, taxes, consumer issues, and cross-border issues. These issues will be addressed through existing and newly formed working groups.
FSR Led Priorities:
FSR Supporting Priorities:
Cybersecurity, economic policy, consumer issues and emerging technologies.
Trade, taxes and cross-border issues.
INVESTMENT MANAGEMENT Advocates on behalf of members that provide products and services to individual and institutional investors, businesses, non-profits and governments; or otherwise engage in the investment and capital markets financial instruments arenas.
FSR Led Priorities:
FSR Supporting Priorities:
Potential SIFI Designations of asset managers and investment companies; retirement planning, saving and investment, fiduciary duties and standards of care.
Investment funds regulation, capital markets issues affecting portfolio managers as investors, U.S. Securities market structure.
FSR Led Priorities:
FSR Supporting Priorities:
TRIA reauthorization, systemically important designations, bank provided derivative products, fraud reduction, patent reform and vendor management.
Capital Standards, Insurance Modernization, Orderly Liquidation Authority, National Flood Insurance Program, Risk Hedging Practices and Dodd-Frank Title VII Reform.
FSR Led Priorities:
FSR Supporting Priorities:
Payment cards, mobile and emerging payments, payments fraud and security, infrastructure development, interchange.
Interchange litigation, bank secrecy act and anti-money laundering requirements.
FSR Led Priorities:
FSR Supporting Priorities:
GSE Reform, FHA reform, servicemember affairs and mortgage regulations.
Auto and commercial equipment finance; student lending; small business lending and LMI lending.
RISK MANAGEMENT Advocates on behalf of our members for the development of robust risk management practices protecting the financial and reputational strength of financial institutions, their customers and the financial system.
PAYMENTS Advocates on behalf of members providing payments services and products to consumers, including card, electronic, mobile and emerging payments.
LENDING & LEASING Advocates on behalf of members providing loans and leases to customers, including mortgage lending, servicing, auto and commercial equipment leasing, and student/military member lending.
9
FSR A cc o m p l i s h m e n t s
A LOOK BACK Looking back on 2013 2013 was a year of gridlock, budget battles, and public attitudes toward Washington that dropped to an all-time low. While legislative action on Capitol Hill was nearly at a standstill, FSR achieved a wide range of important objectives for the financial industry.
As the threat of cybersecurity breaches continue to concern
10 | FSR Annual Report 2013
our industry, FSR’s advocacy in 2013 helped secure the passage of bipartisan information sharing legislation in the House, despite the strong opposition of some political leaders. In 2014, we will work to promote threat-information sharing legislation to take on cyber criminals.
Advocacy Under the leadership of FSR CEO Tim Pawlenty, our team’s positive relationships with congressional leaders and regulators helped achieve important gains on key issues. The Terrorism Risk Insurance Act (TRIA), a program that is vital to protect the economy in the wake of a future terrorist attack, expires at the end of 2014. At the beginning of 2013, the renewal of TRIA looked bleak. With waning support among members of Congress, this vital program for owners and insurers of hotels, stadiums and large buildings appeared to be in jeopardy. FSR went to work to change the attitudes toward this program and educate congressional leaders about the underwriting difficulty associated with terrorism insurance. FSR has made significant gains and we are now confident that TRIA will be renewed in 2014. Tailoring capital requirements for the insurance business model advanced notably on Capitol Hill with the introduction of bipartisan Senate legislation that would amend Dodd-Frank, providing the Federal Reserve additional flexibility to establish these standards. The Federal Reserve also publicly agreed that tailored standards were appropriate, an important step that FSR applauded. As legislation on capital standards continues to move on Capitol Hill, FSR will continue to engage on this important issue. Housing Finance Reform: FSR and the Housing Policy Council (HPC) gained considerable ground on housing finance reform in 2013,
with both the House and Senate introducing substantive housing policy reform legislation. The Senate legislation most closely reflected the reform approach advocated by FSR and HPC to replace Fannie Mae and Freddie Mac with a new housing finance system. FSR and HPC have been working for better regulation of the GSEs since 2003. • Two major pieces of GSE reform legislation were introduced in Congress in 2013, including a bipartisan Senate bill that reflected our members’ primary goal of creating a new mortgage finance system based on private capital, backed by a last-resort government guarantee. • HPC demonstrated its position as a leading authority on housing issues in testimony before the Senate Banking Committee on the role of a federal regulator in a new housing finance system, and on military servicemember financial affairs issues by testifying before the Senate Veterans Affairs Committee on efforts to improve industry compliance with the Servicemember Civil Relief Act. • In partnership with the HOPE NOW Alliance, HPC also completed the “Project Patriotism: Homes for Veterans” white paper. The paper outlined the best practices that financial services companies are using to deed homes to veterans, wounded warriors and military families. • The HOPE NOW Alliance, an HPC affiliate, continued to assist distressed mortgage borrowers by finding permanent solutions to avoid foreclosure. HOPE NOW held 16 homeowner outreach events across the country attended by more than 5,500 homeowners.
11
FSR A cc o m p l i s h m e n t s
Regulatory Consumer Affairs: Consumer affairs issues in the Washington regulatory environment saw considerable movement in 2013, making FSR’s strong ties to regulatory officials more important than ever. The surge in consumer regulation will continue in 2014 as regulators push the boundaries of their authority. • In November 2013, FSR hosted five key financial regulatory agencies at a forum on protecting older Americans from financial abuse. The Consumer Financial Protection Bureau, the Securities and Exchange Commission, Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Board of Governors of the Federal Reserve System were all in attendance. Since many FSR members are regulated by three, or even four of the agencies represented, clear and consistent rules of the road are vital. The meeting produced a commitment on the part of the regulators to continuing the interagency coordination demonstrated when they issued guidance on the sharing of personal information under the Gramm-Leach-Bliley Act. In 2014, FSR will continue advocating to preserve arbitration provisions in consumer financial services agreements, for implementing policy through open rulemaking instead of through enforcement actions, and for market-sensitive fair lending rules.
12 | FSR Annual Report 2013
2013 was another year of major rule-writing in the postDodd-Frank era. Approximately half of all the rules required under Dodd-Frank have been written, but many are still to come. These rules are complicated and FSR’s regulatory team provided analysis and response to regulators on these complex regulations, including the Volcker Rule, rules on capital standards and others. This representation is informative as regulators look to apply certain rules across various sectors that may not have been impacted in the past. FSR will continue that strong commitment as new rules are introduced and work to amend those that require improvement through 2014. • FSR’s leadership convinced other federal regulators to acknowledge the SEC’s role as the nation’s primary markets regulator. This development was key to providing the clarity our members need on these regulatory issues. FSR facilitated a private briefing for our members by a policymaker shortly after the passage of the Volcker Rule, which provided members with information about how the new regulation would impact their business and the overall industry. • Basel III, a regulation aimed at balancing capital standards for financial institutions, was significantly improved through FSR’s advocacy efforts. Improvements included simplifying the process determining how much bank capital must be held in conjunction with mortgages. • Regulators responded to a targeted FSR letter and deferred the application of Basel III rules on insurance institutions that include banking subsidiaries.
13
FSR A cc o m p l i s h m e n t s • FSR held regulators accountable, including the CFTC (Commodities Futures Trading Commission), for implementing Dodd-Frank standards that are congruent with best market practices on swap trades and other practices. • Regulators integrated suggestions from FSR into the Volcker Rule released in December that allows insurance companies with banking affiliates to continue investing in private equity and hedge funds, a change that ensures the insurance market can continue to thrive long-term.
Technology & Cybersecurity In 2013, the overall vulnerabilities and threats stemming from cybersecurity issues reached its highest level since tracking began in May 2000, according to Cisco’s 2014 Annual Security Report. The report also indicated the world will face a shortage of more than one million security professionals in 2014 alone. It’s no wonder that cybersecurity is a top-ofmind issue for every CEO in the financial service industry. As the Washington trade association that represents the leaders of the financial sector across the spectrum, FSR is the leader when it comes to cybersecurity. FSR’s in-house think tank, BITS, worked in 2013 to influence the introduction and passage of the Cyber Intelligence Sharing and Protection Act (CISPA) in the House, as well as President Barack Obama’s 2013 Executive Order on Cybersecurity, which outlined the National Institute of Standards and Technology’s Cybersecurity Framework.
14 | FSR Annual Report 2013
Other areas BITS engaged in include: • FSR hosted a panel event with former Secretary of Homeland Security, Michael Chertoff, former NSA Director, Michael Hayden, and U.S. Representative Mike Rogers on the importance of preparing for a cyber attacks. The event raised awareness in Washington on the needs of the financial industry in preparing for such events. • A government fraud reduction program aimed at improving the identify proofing process for opening accounts, the Financial Institutions Verification of Identity Credentials System, was guided to completion through BITS’ focus on emerging technology risks. • BITS worked with the U.S. Treasury Department to develop classified level briefings on cybersecurity for CEOs, CIOs, and CISOs in the financial services industry. These briefings give financial leaders important insights to help guide their cyber-protection efforts. • f TLD, a project in which FSR has invested, made significant progress to protect the financial services industry’s ability to operate the generic Top-Level Domains (gTLDs) .bank and .insurance. f TLD is on track to operate these top level domains by the end of 2014. FSR CEO Governor Tim Pawlenty also worked to shape the policy debate by speaking at several events and participating in several media appearances to highlight the financial services industry’s perspective on this vital issue. As increasingly sophisticated cybercriminals continue to threaten our members’ business, FSR remains dedicated to finding secure solutions and representing the needs of our members before Congress and regulators.
Communicating the Message The legislative positions and accomplishments of the financial services industry were increasingly communicated to Washington and the public by the new media professionals in FSR’s revamped communications department. We continue to grow rapidly as one of the leading voices for our members. • FSR orchestrated a major top-to-bottom rebrand, including a new website, new logo, new focused messaging and new strategic reporter and industry-wide outreach. • FSR significantly increased the number of national media appearances featuring its prominently recognized CEO, Tim Pawlenty, advocating on FSR’s policy issues to a national audience. • FSR’s ability to proactively communicate, as well as rapidly respond to media requests and breaking news on vital industry issues increased considerably.
• The Communications Department launched several successful public events on topics including cybersecurity and housing finance reform, both of which received significant attention from the media and Washington policymakers. Corporate Social Responsibility: FSR companies made major impacts on local communities, and the Department of Corporate Social Responsibility helped promote those efforts last year, highlighting more than 33,000 completed financial literacy projects and $526 million raised by our members to support financial literacy and community development efforts. This resulted in increased notice by members of Congress and the national media, boosting the public image of our industry. We continue to grow this area of focus in 2014 by adding new corporate sponsors to our expanding roster and collaborating with members to highlight their important accomplishments in this area.
FSR’s 2013 conferences highlighted influential Washington figures, including: Richard Cordray, CFPB Director Jeb Hensarling (R-TX), House Financial Services Committee Chairman Steny Hoyer (D-MD), House Democratic Whip Jacob Lew, Secretary of the Treasury Chris Van Hollen (D-MD), House Budget Committee Ranking Minority Member Ben Bernanke, Federal Reserve Board Chairman Valerie Jarrett, Special Advisor to Barack Obama Chuck Todd, NBC News Political Director Jim Vandehei, POLITICO Co-founder and Executive Editor
15
FSR B y T h e N u m b e r s
FSR BY THE NUMBERS 356 28 The number of regulatory comment letters submitted by FSR since the passage of Dodd-Frank.
91
The number of comment letters submitted by the FSR in 2013 on key issues important to the financial services industry.
50.5%
The percentage of the 398 required Dodd-Frank rules adopted since the law was signed.
110
The number of Dodd-Frank rules still left to be proposed.
16 | FSR Annual Report 2013
FSR-hosted meetings of the Consumer Working Group, an FSR member forum providing an opportunity to engage with speakers from the CFPB and other regulators.
12+
Meetings with the CFPB that FSR led or participated in on topics including the Consumer Response Portal and TILA-RESPA.
11
Comment letters filed by FSR to the CFPB on proposed consumer regulations.
Housing Policy Council and the HOPE NOWModifications ALLIANCE Completed (thousands of loans)1
200 150 200
Modifications Completed (thousands of loans)1
100 150 50 100 0 50 0
Completed (Proprietary)
Completed HAMP
Corporate Social Responsibility
549,000
The number of FSR member company employees who volunteered on financial literacy, fundraising and other corporate social responsibility projects.
310,000
The above image illustrates the total numberCompleted of modifications on a monthly basis from Q2 of 2007. The Completed (Proprietary) HAMP substantial decrease of Proprietary and HAMP Modifications over the last two years can be attributed to The number of the dedicated work of mortgage servicers, reduction in delinquent borrowers, and to the variety of loss The image thethe total number of modifications on a monthly Theabove abovesolutions. imageillustrates illustrates total number of modifications on a basis from Q2 of 2007. The mitigation substantial decrease and substantial HAMP Modifications the last two years can be attributed to monthly basis fromofQ2Proprietary of 2007. The decreaseover of Proprietary the work of mortgage reduction delinquent borrowers, anddedicated HAMP Modifications overservicers, the last two years in can be attributed to theand to the variety of loss mitigation dedicated solutions. work of mortgage servicers, reduction in delinquent borrowers,
and to the variety of loss mitigation solutions.
Cumulative Total Modifications and Short Sales Completed (thousands of loans)1
9,000 8,000 7,000 6,000 9,000 5,000 8,000 4,000 7,000 3,000 6,000 2,000 5,000 1,000 4,000 0 3,000 2,000 1,000 0
Cumulative Total Modifications and Short Sales Completed (thousands of loans)1
Completed (Proprietary)
Completed HAMP
projects accomplished by volunteers.
$526 million
The amount raised and donated by FSR member companies to support community development efforts across the nation.
33,000
The number of community financial literacy projects completed by FSR and its members.
Completed Short Sale
The the cumulative total of Modifications and Short Sales on a monthly basis from Theabove aboveimage imagedepicts depicts the cumulative total of Modifications and Short Completed (Proprietary) Completed HAMP Completed Short Sale Q2 of 2007. Over 8 million struggling received home assistance from their mortgage Sales on a monthly basis from Q2 ofhomeowners 2007. Over have 8 million struggling servicers duringhave the past six and a half years. from their mortgage servicers homeowners received home assistance The above image depicts the cumulative total of Modifications and Short Sales on a monthly basis from during the past six and a struggling half years.homeowners have received home assistance from their mortgage Q2 of 2007. Over 8 million 1 HOPE NOW data is extrapolated based on submission from servicer members of the Alliance and the “MBA National Delinquency Survey”. servicers during the past six and a half years. 1
HOPE NOW data is extrapolated based on submission from servicer members of the Alliance and the “MBA National Delinquency Survey”.
17
2013 F i n a n c i a l R e p o r t
The following financial information was derived from FSR’s audited financial statements which contained an unqualified opinion from Rogers & Company, PLLC, dated February 28, 2014. A complete copy of this audit is available from George Forsberg, FSR Chief Financial Officer, at George.Forsberg@FSRoundtable.org. Assets Cash and cash equivalents Accounts receivable Prepaid expenses Investments Property and equipment, net Deposits Prepaid pension asset Deferred compensation assets
2013
2012
$ 7,980,887 297,276 160,892 5,191,653 208,715 249,575 2,275,104 338,901
$ 3,328,447 421,984 84,696 5,089,757 444,998 135,111 1,754,252 222,797
$ 16,703,003
$ 11,482,042
$ 501,323 2,444,241 4,883,638 211,723 14,578 338,901
$ 476,570 2,541,639 1,287,247 411,723 53,451 222,797
Total liabilities
$ 8,394,404
$4,993,427
Net Assets Unrestricted: Undesignated Housing Policy Council Anthony T. Cluff Research Fund
$ 6,484,580 1,430,153 393,866
$ 4,872,066 1,130,142 486,407
Total unrestricted net assets
$ 8,308,599
$ 6,488,615
$ 16,703,003
$ 11,482,042
Total assets Liabilities and Net Assets Liabilities Accounts payable Accrued expenses Deferred assessment income Refundable advances Deferred rent Accrued deferred compensation
Total liabilities and net assets
18 | FSR Annual Report 2013
Operating Revenue and Support Membership dues Partnership for a Secure Financial Future Coalition revenue Meetings Community service Agents for Change Hope Now sponsorship and outreach Grant revenue Investment income Project revenue Other income
$ 16,118,332 - 1,522,091 823,525 480,000 240,000 773,050 200,000 58,237 5,000 181,147
$ 14,706,650 3,584,000 1,848,204 840,440 455,000 309,750 794,001 134,734 49,293 82,060
Total operating revenue and support
20,401,382
22,804,132
3,673,850 1,467,995 911,417 746,142 308,370
3,553,160 1,455,022 1,140,452 218,296 265,641
7,107,774
6,632,571
2,758,510 2,662,016 1,145,009 1,247,500 354,068 126,053 265,240 -
2,878,452 2,501,006 1,861,146 1,679,135 365,930 334,854 90,236 3,584,000
Total program services
15,666,170
19,927,330
General and administrative
2,260,273
2,563,155
17,926,443
22,490,485
2,474,939
313,647
Non-Operating Activities Staff and meeting realignment charges Change in benefit plan obligation Loss on investment in subsidiary
(780,851) 125,896 -
233,014 (105,737)
Total non-operating activities
(654,955)
127,277
Change in Net Assets
1,819,984
440,924
Net Assets, beginning of year
6,488,615
6,047,691
$ 8,308,599
$ 6,488,615
Expenses Program services: Roundtable services: Executive management Government affairs Meetings and member activities Communications and special projects Membership Total Roundtable services
BITS Housing Policy Council Coalition activities Hope Now Community service Agents for Change Anthony T. Cluff Research Fund Partnership for a Secure Financial Future
Total expenses Change in Net Assets from Operations
Net Assets, end of year
2013
2012
19
FSR S ta f f D i r e c to r y
FSR TEAM Executive
Communications
ITAC
Tim Pawlenty, President and CEO of FSR Eric Hoplin, Executive Director
Alison Hawkins, Vice President of
Anne Wallace, Senior Director of Consumer
Communications
Financial Services and President of the Identity Theft Assistance Corporation
Administration
Manager
George Forsberg, Chief Financial Officer Denise Miller, Executive Assistant and
Erika Reynoso, Senior Communications
Janelle Bowe, Contractor
Saat Alety, Digital Manager
Meetings
Cindy Nettles, Executive Assistant to
Corporate Social Responsibility
CEO Tim Pawlenty
Judy Chapa, Vice President of Corporate Social
Carole Richmond, Receptionist Kim Ward, Accounting Assistant Michelle Wirth, Contractor
Responsibility
Membership
Government Affairs
Sarah Drew, Vice President of Membership Suren Raj Vidyadhar, IT Consultant
Operations Manager
Francis Creighton, Executive Vice President of
AIM
Government Affairs
Tatiana Fittipaldi, Director of Meetings and Events
Susan Mitchell Blavin, Executive Director, AIM
Anthony Cimino, Vice President of Government
Regulatory
Affairs for Risk Management
Richard Foster, Vice President for Legal and
BITS
Brenda Bowen, Government Affairs Manager Jordan Quinn, Government Affairs Program
Regulatory Affairs
Paul Smocer, President of PITS John Carlson, Executive Vice President for Technology Risk
Nancy Guglielmo, Vice President of Fraud Reduction
Andrew Kennedy, Senior Program Manager Jim Pitts, Senior Project Manager Roxane Schneider, Program Manager – Fraud Reduction
Dan Schutzer, Contractor Craig Schwartz, Direction of Registry Services
20 | FSR Annual Report 2013
Manager
Felicia Smith, Regulatory Counsel Robert Hatch, Counsel for Legal and Regulatory Affairs
HPC John Dalton, President of HPC Paul Leonard, Senior Vice President of Government Affairs, HPC
Eric Selk, Executive Director, HOPE NOW Brad Dwin, Media Consultant, HOPE NOW Todd Hill, Director of Government Affairs, HPC Manuel Grajeda, Government Affairs Assistant Oliver Samuel-Jakubos, Data Manager
Richard Whiting Retires from FSR: There are few faces more familiar in the world of financial industry advocacy than Richard Whiting. After 30 years of service at FSR, Rich retired in February 2014 after serving as Executive Director and General Counsel. He previously served as a Senior Attorney in the Office of the General Counsel of the Federal Reserve Board and is a graduate of Boston College Law School. Rich is a true professional with a wealth of institutional knowledge that spanned decades of change in the financial world. During the course of his career, he authored several articles and books on the financial services industry. Not only was he an invaluable source of information to our members, but he was also a dear friend to our colleagues, customers and staff. Rich prided himself in delivering the highest quality work possible while simultaneously making the lives of those around him better. We warmly wish him the best in his future endeavors.
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FSR S ta f f D i r e c to r y
NEW SENIOR STAFF Eric Hoplin Eric Hoplin is the new executive director of the Financial Services Roundtable. Eric’s tenure with FSR began in 2013 when he previously served as Vice President of Communications & Organizational Strategy. Hoplin has more than a decade of experience leading teams to advance public policy and helping organizations succeed by leveraging his expertise in management consulting, strategic communication, change management, and public policy. Previously, Hoplin was a Lead Associate with Booz Allen Hamilton, a Fortune 500 Consulting Firm. He has served in a variety of public policy and political leadership roles, including as deputy chairman of the Republican Party of Minnesota. Hoplin holds a Master of International Affairs degree with concentrations in management and international security policy from Columbia University, an M.B.A. from Augsburg College, a B.A. in political science and communications from St. Olaf College, and a Certificate in Change Management from Georgetown University McDonough School of Business. Hoplin and his wife Nicole live in Vienna, Virginia, with their two boys.
Francis Creighton Francis Creighton recently joined FSR as Executive Vice President of Government Affairs. Prior to starting at FSR, he served as the Chief of Staff for Senator Chris Murphy (D-CT). Before working for Senator Murphy, Francis served as the top lobbyist and vice president for the Mortgage Bankers Association from 2003 to 2009. Francis was an appointee to the Department of Labor during the Clinton Administration from 1999 to 2001, where he worked on private sector employee benefits. He then left for GCI Group, a consulting and public relations firm, and later headed up Rep. Steve Israel’s (D-NY) legislative portfolio while on the House Financial Services Committee.
22 | FSR Annual Report 2013
Alison Hawkins Alison Hawkins is the Vice President of Communications at the Financial Services Roundtable, having previously been FSR’s Director of Communications, where she oversees media and communications on both the strategic and operational levels. Hawkins is a campaign veteran of the 2012 presidential election and previously served as a Presidential Appointee Press Secretary at the Department of Veterans Affairs. Alison joined FSR from The Philanthropy Roundtable and also has worked on the communications staff of Senator Mike Crapo (R-ID), current Ranking Member of the United States Senate Committee on Banking, Housing, & Urban Affairs. Hawkins is a native of Idaho and currently lives in Falls Church, Virginia, with her husband, baby girl and two dogs.
Sarah Drew Sarah Drew is the Vice President of Membership at the Financial Services Roundtable, where she manages FSR’s membership experience, including member retention, recruitment, and services. Drew also serves as liaison to the FSR Board of Directors and Executive Committee, and oversees FSR’s information technology division. Drew began her career at FSR as a public affairs specialist in 2008. She later joined BITS, the technology policy division of the Roundtable, as the BITS/FSTC project administrator, and eventually returned to FSR as project manager for Dodd-Frank Implementation. Drew became Director of Membership and Information Services in 2011 and was elevated to Senior Director of Membership and Information Services in 2013. Drew holds a Bachelor of Arts degree and Business Foundations Certification from the University of Texas at Austin.
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FSR B o a r d
of
D i r e c to r s
Chairman
Chairman-Elect
Immediate-Past Chairman
Larry Zimpleman, Principal Financial Group
Frederick H. Waddell, Northern Trust Corporation
John G. Stumpf, Wells Fargo & Company
BITS Chairman Kelly S. King, BB&T Corporation
24 | FSR Annual Report 2013
Treasurer Thomas R. Watjen, Unum
24
B oa r d
of
D i r e c to r s
Directors
Richard K. Davis, U.S. Bancorp Roundtable Chairman 2010
Edward B. Rust, Jr., State Farm Insurance Companies Roundtable Chairman 2002
Thomas J. Wilson, The Allstate Corporation Roundtable Chairman 2012
Team Expiring 2014
Theodore A. Mathas, New York Life Insurance Company, Executive Committee Member
Ajaypal S. Banga, MasterCard
Gary C. Bhojwani, Allianz Life Insurance Company of North America
D. Bryan Jordan, First Horizon National Corporation
Manuel Sanchez, BBVA Compass
Stephen D. Steinour, Huntington Bancshares Incorporated
Mark Casady, LPL Financial Corporation
James A. Israel, John Deere Financial Services Company, Inc.
25
Team Expiring 2015
Beth E. Mooney, KeyCorp, Executive Committee Member
John F. Barrett, Western & Southern Financial Group
Irene M. Dorner, HSBC Bank USA, N.A.
Mark W. Mullin, Transamerica
David W. Nelms, Discover Financial Services, Inc.
William H. Rogers, Jr., SunTrust Banks, Inc.
Grayson Hall, Regions Financial Corporation
Brian T. Moynihan, Bank of America Corporation
Masashi Oka, The Bank of Tokyo Mitsubishi, UFJ
Team Expiring 2016
Kent Adams, Caterpillar Financial Services Corporation, Executive Committee Member
William S. Demchak, The PNC Financial Services Group, Inc.
Philip B. Flynn, Associated Banc-Corp
Joseph L. Hooley, III, State Street Corporation
Mark Pearson, AXA Financial, Inc.
Charles W. Scharf, Visa
Mark Standish, RBC Capital Markets
Kessel Stelling, Synovus
26 | FSR Annual Report 2013
FSR BRINGS TOGETHER THE LEADERS OF THE INDUSTRY TO SET THE STANDARDS FOR A STRONG FINANCIAL SYSTEM AND VIBRANT GLOBAL CAPITAL MARKETS.
M e m b e r C o m pa n i e s
MEMBER COMPANIES Allianz Life Insurance Company of North America
Brown & Brown Insurance
Allstate Corporation, The
Caterpillar Financial Services Corporation
Ally Financial Inc. American Honda Finance Corporation
The Chubb Corporation
Ameriprise Financial, Inc.
Citigroup Inc.
Ares Capital Corporation
City National Corporation
Associated Banc-Corp
Comerica Incorporated
Assurant, Inc.
Commerce Bancshares, Inc.
AXA Financial, Inc.
Discover Financial Services
BancWest Corporation
Edward Jones
Bank of America Corporation
Fidelity Investments
Bank of Hawaii Corporation
Fifth Third Bancorp
The Bank of Tokyo Mitsubishi, UFJ
First Horizon National Corporation
Barclays
First Niagara Financial Group, Inc.
BB&T Corporation
First Republic Bank
BBVA Compass
Ford Motor Credit Company
BlackRock, Inc.
Fulton Financial Corporation
BMO Financial Corp.
28 | FSR Annual Report 2013
Capital One Financial Corporation
CIT Group, Inc.
GE Capital
New York Life Insurance Company
State Street Corporation
Genworth Financial
Northern Trust Corporation
SunTrust Banks, Inc.
Hancock Holding Company
OneWest Bank
The Hanover Insurance Group
People’s United Bank
Swiss Re America Holding Corporation
The Hartford
The PNC Financial Services Group, Inc.
Synovus
Huntington Bancshares Incorporated
Popular, Inc.
Toyota Financial Services
Principal Financial Group
Transamerica
IBERIABANK Corporation
PrivateBancorp Inc.
Trustmark Corporation
ING U.S.
Protective Life Corporation
TSYS
John Deere Financial Services, Inc.
Prudential Financial, Inc.
U.S. Bancorp
JPMorgan Chase & Co.
Putnam Investments
United Bankshares, Inc.
KeyCorp
Raymond James Financial, Inc.
Unum
Lincoln National Corporation
RBC Capital Markets
Visa Inc.
LPL Financial
RBS Citizens Financial Group, Inc.
Webster Financial Corporation
M&T Bank Corporation
Regions Financial Corporation
Wells Fargo & Company
MasterCard
RenaissanceRe Holdings Ltd.
Mutual of Omaha Insurance Company
Santander
Western & Southern Financial Group
Securian Financial Group, Inc.
Zions Bancorporation
Nationwide
State Farm Insurance Companies
HSBC USA, Inc.
TD Bank
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M e m b e r C o m pa n i e s
30 | FSR Annual Report 2013
31
Looking
to
2014
LOOKING AHEAD Election years always present both unique opportunities and challenges in Washington. The growing excitement over new leadership can be reinvigorating in a stale political environment. Retiring or outgoing lawmakers often scramble to pass their last bits of legacy legislation through Congress, which can open legislative opportunities. However, the timeline for advocacy in an election year can also be shortened as members turn their focus to their campaigns as November draws closer. In 2014, FSR is committed to bringing focus and added value where the needs of our members intersect. Our advocacy will be strategic and focused, committed to achieving success from Capitol Hill to the administration while changing public attitudes about our industry.
32 | FSR Annual Report 2013
Our top priorities this year include ensuring the DoddFrank law and other government action is implemented appropriately in a way that doesn’t place far-reaching burdens on financial services companies and their customers. The financial services industry is one of the most regulated sectors in the economy, with more regulation on the way. FSR will be a voice for rational regulations which emphasize consumer choice, consumer protection and operational efficiency.
Reforming the housing market by winding down Fannie Mae and Freddie Mac will be a key FSR focus, while also keeping our members informed on how the latest CFPB mortgage regulations will impact their business. Protecting the financial services industry and virtual business transactions from criminals, as well as protecting the economy in the instance of a cybersecurity breach, are vital to our mission. Finding common-sense solutions and
bridging the gaps with all in the payment ecosystem will be critical to the financial services sector and FSR will be leading the charge in Washington to bring the pieces together. Providing members with the latest developments in fraud and cybersecurity crime prevention, as well as educating the next generation of experts in this field, will be a key focus of BITS and FSR. Leveraging senior FSR leadership as subject matter experts to raise FSR’s profile with lawmakers, the media and the general public will help build credibility and assist us in achieving our objectives on behalf of our members. Beyond our traditional spring and fall conferences, we plan to increase the number of high-impact public events that we host, providing our members direct interactions with D.C. policy and decision makers, as well as promoting the positions of our members to the media. This year, FSR is committed to strengthening our relationships with our member companies and the customers they serve.
We will also lead and build coordination and teamwork among other financial trade associations to deliver maximum results in Washington. Throughout 2014, FSR will keep our companies informed and connected with the latest information and newest leaders in Washington. We are excited for the year ahead and the new opportunities and changes this year will bring as we advocate for you. Our Policy
Priorities include:
TRIA Reauthorization Cybersecurity GSE Reform SIFI Designation Retirement Security
Patent Reform Payment Fraud Data Breach Mortgage Regulation Fiduciary Duties
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FSR IS COMMITTED TO BRINGING FOCUS AND ADDED VALUE WHERE THE NEEDS OF OUR MEMBERS INTERSECT. OUR ADVOCACY WILL BE STRATEGIC AND FOCUSED, COMMITTED TO ACHIEVING SUCCESS.