To bring Mississippi into the mainstream, the Mississippi Bankers Association (MBA) is lobbying for passage of the Uniform Prudent Investor Act (House Bill 1112), legislation that would enact the Prudent Investor Rule, specify standards for compliance, encourage diversification of investments and prohibit unreasonable investment costs.
“Mississippi is one of only 10 states that doesn’t have a law setting out rules for professional trustees and professional investment departments,” explained MBA executive director Mac Deaver. “Most of the trust departments tell us the current industry standard is to comply with more advanced standards. I think the courts have been enforcing a different standard, but it’s not in our law. By updating it, our trust departments think it will create more opportunity for trust business in the state.”
House Judiciary A Committee member Bill Denny (R-Jackson) introduced HB1112, which is awaiting action in that committee, chaired by Rep. Ed Blackmon Jr. (D-Canton).
The MBA has been asked to weigh in on the statewide building code issue, which would affect the massive post-Katrina rebuilding efforts that will take place in South Mississippi.
“We’re not sure how we feel,” said Deaver. “Whether it should be a local decision or whether the state should mandate it has become controversial. It would establish some standard of value in construction, but the downside is that it’ll cost more to build.”
The MBA is monitoring legislation that would affect pre-construction condominium sales in the post-Katrina rebuilding era. “Florida and some other states have a pretty elaborate system of laws that protect the interests of different parties,” explained Deaver. “There’s a bill at the capital that has Florida law generally in it that is of interest to some banks, particularly on the coast. But it’s not a priority for our association.”
A proposal has been introduced at the state capital to allow interstate branching, a measure supported by Hancock Bank. The MBA does not have a position on the issue.
“Some states have passed laws that allow interstate branching on a reciprocal basis,” said Deaver. “In other words, if you let our banks branch into your state, we’ll let your banks branch into our state. Only one neighboring state has reciprocal interstate branching, and that’s Tennessee. We’ve talked about it and there’s a division of opinion, so the MBA is monitoring it.”
Mississippi bankers are interested in proposed changes to the campaign finance law. “There are some efforts at the capital to restrict the ability of businesses to participate in elections and we’re opposed to that,” said Deaver. “We’re trying to keep it open so businesses can participate in the election process. The governor vetoed a bill that would’ve put some restrictions on it and we think there’ll be more effort to do that this time.”
The MBA would like to see some regulatory items repealed that are not enforced. “For example, there’s a law on the books that requires a loan committee to approve in advance all loans over $25,000, and that doesn’t happen,” said Deaver. “There’s a law in the books passed several years ago that allows non-licensed agents to be paid referral fees on insurance. We’re going to try and get that reenacted.”
MBA’s bank attorneys committee is reviewing legislation governing safety deposit boxes. “Mississippi doesn’t have any statutes that govern them and there’s a lot of liability attached,” said Deaver. “We don’t have a position on it yet, but we’re studying it.”
Some bankers are concerned about the timing of the cigarette/grocery tax bill. “I thought for some time everyone would cool off for a few weeks and work out something where both sides could gain victory, but I think the Senate might try to override the veto,” he said in late January.
The MBA also supports changes to the garnishment law that would standardize some of the processes.
Contact MBJ contributing writer Lynne W. Jeter at Lynne.Jeter@gmail.com.