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Community Bankers Association of Illinois
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     A Bi-Weekly News Bulletin for CBAI Members                                    February 3, 2016

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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois
  • CBAI ACTION ALERT - Oppose the FASB Current Expected Credit Loss Model
  • U.S. House Members Express CECL Concerns to FASB
  • CBAI ACTION ALERT – Oppose Expanded Credit Union Membership
  • FDIC Rescinds Plan to Assess Reciprocal Deposits as Brokered Deposits
  • CBAI Critical of FinCEN’s Regulatory Impact Assessment for New Customer Due Diligence Requirements
  • New Poll Finds Regulatory Relief Remains Top Banker Priority
  • CBAI's 26th Annual Officer Compensation Survey Now Online!
  • Federal Home Loan Bank Announces 2016 Member Meetings
  • Save the Date for CBAI's 32nd Annual Capital Conference - April 20, 2016
  • CBAI's 34th Annual Call on Washington Scheduled for April 24-27
  • Investment News From THE BAKER GROUP
  • Farm Loan Originations Remain Strong
  • Consumer Confidence Bolstered in January
  • CSBS-Fed Community Bank Research Conference Set for September 28-29
  • Midwest Office: Showcase Your Brand with the Most Powerful Form of Advertising!
  • CBAI Education Foundation Is 20 Years Young – Give Us a High Five!
  • Five Mistakes Banks Must Avoid When Moving to Electronic Signatures
  • Shaping the Message to Counter Megabanks
  • The 25 Worst Passwords of 2015
  • CBIS Nicoud: What Credit Life and Disability Insurance Mean for Your E&O Policy
  • Make Your Hotel Reservations NOW for CBAI’s 42nd Annual Convention & Expo!
  • IRA Institute Scheduled for February 9 & 10
  • Deposit Documentation Slated for February 23-25
  • Commercial Lending Institute Set for February 23-25


  • CBAI ACTION ALERT - Oppose the FASB Current Expected Credit Loss Model

    Register today your opposition in advance of tomorrow's ICBA meeting with the Financial Accounting Standards Board!

    On February 4, 2016, a delegation of ICBA leadership bankers, including CBAI’s Greg Ohlendorf, President and CEO of First Community Bank and Trust in Beecher, will meet with the Financial Accounting Standards Board (FASB) to register their concerns with the proposed Current Expected Credit Loss (CECL) model. This meeting was called by FASB shortly after comments were made by FASB’s Chairman that community banks were major contributors to the financial crisis. Please Read CBAI’s Reaction to the Comments of FASB Chairman Russell Golden.

    CBAI urges Illinois community bankers to support Ohlendorf and the ICBA delegation by responding to this Action Alert today to register your strong opposition to the misguided CECL model and express support for the ICBA alternative. ICBA’s common-sense approach would eliminate the requirement to recognize a loan loss on the very day a loan is made, a concept that completely flies in the face of the plain logic that a loan is good the day it’s made (otherwise the loan wouldn’t be made)! Please respond to this Action Alert today and help support Ohlendorf and your fellow community bankers who will be representing all community banks in a face-to-face meeting with FASB on Thursday, February 4th.

    PLEASE RESPOND NOW! Thank you for responding!

    We need a very strong response from all Illinois’ community bankers!

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    U.S. House Members Express CECL Concerns to FASB

    Sixty-two members of the United States House of Representatives (including Illinois Congressmen Mike Bost (R-12), Rodney Davis (R-13), Bill Foster (D-11), Randy Hultgren (R-14), and Mike Quigley (D-05)signed a Member Letter to the Chairman of the Financial Accounting Standards Board (FASB) to express their concerns about FASB’s proposed Current Expected Credit Loss (CECL) model. The CECL model would require banks to estimate loan losses on individual loans the day they are made and adjust the estimated losses throughout the life of the loans. The concept of recording a loan loss on day-one flies in the face of the plain logic that a loan is good the day it’s made otherwise you wouldn’t make the loan. Read More.

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    CBAI ACTION ALERT – Oppose Expanded Credit Union Membership

    Credit Unions were never intended to be tax-exempt banks!

    CBAI urges all Illinois community bankers to respond to this Action Alert (which you can customize if you like) expressing opposition to the National Credit Union Administration’s (NCUA) proposal that would eliminate much of the current credit union membership requirements established by the Federal Credit Union Act.

    This proposal, which has been characterized by the NCUA as the most comprehensive, sweeping, and substantive policy change in this area in 45 years, is another example of the NCUA attempting to extend their industry's government-funded competitive advantage over taxpaying community banks.

    If credit unions want to eliminate the common bond requirement and operate like banks, they should be taxed like banks and should be required to meet all of the same regulatory requirements. They can't have it both ways.

    PLEASE ACT NOW!!

    Email Congress and the NCUA Today!

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    SHAZAM’s 2016 Forum will be igniting new opportunities with inspirational speakers, informative sessions and networking events. Knowledgeable experts will enlighten you on topics such as fraud, core services, mobile wallets, laughter in the workplace and more! Don’t miss out on SHAZAM’s 2016 Forum. Register Today!



    FDIC Rescinds Plan to Assess Reciprocal Deposits as Brokered Deposits

    Community banks have recorded another victory! The FDIC Board of Directors voted to rescind its controversial plan to assess reciprocal deposits as brokered deposits in the calculation of community bank deposit insurance assessments. The FDIC initially made this recommendation in a July of 2015 Notice of Proposed Rulemaking (NPR) to “refine” the deposit insurance assessment system for small depository institutions ($10 billion in assets and under). The FDIC received more than 400 comment letters (including a letter from CBAI) critical of the plan and CBAI is pleased to report that the FDIC has responded to the concerns of community banks. Read More.

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    CBAI Critical of FinCEN’s Regulatory Impact Assessment for New Customer Due Diligence Requirements

    The Financial Crimes Enforcement Network (FinCEN) has proposed new Customer Due Diligence (CDD) requirements for financial institutions to identify beneficial owners of legal entity customers. FinCEN’s rulemaking on these new requirements began in 2012, continued in 2014, and on Christmas Eve of 2015, published in the Federal Register the Regulatory Impact Assessment (RIA) which included a brief 30 day comment period. Read More.

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    New Poll Finds Regulatory Relief Remains Top Banker Priority

    According to a new SourceMedia survey of more than 300 bankers, 43% of respondents named “reducing the compliance burden on small banks” as the top policymaking focus this year. CBAI and ICBA are working to attain meaningful regulatory relief during this session of Congress. Read More.

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    CBAI 26th Annual Officer Compensation Survey Now Online!

    How Does Your Bank’s Compensation Stack Up?

    How does your bank’s compensation stack up? CBAI’s 26th Annual Officer Compensation Survey registers officer salaries, incentives, benefits, total compensation and more. It also tabulates support personnel’s benefits and compensation, plus compensation to bank directors. Peer results will include information based on bank asset size and geographical location. RESULTS FREE TO CBAI MEMBERS THAT PARTICIPATE!

    For a .pdf of the survey to use as a worksheet, click here.

    To complete the actual survey, click here.

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    Federal Home Loan Bank Announces 2016 Member Meetings

    The Federal Home Loan Bank of Chicago last week released the dates and agenda for its annual member meetings which will be held in March. The agenda features presentations from Matt Feldman, President and CEO of the FHLB of Chicago, and Ed Krei, Managing Director of the Baker Group. For more details and to register, Click Here.

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    Save the Date for CBAI's 32nd Annual Capital Conference - April 20, 2016

    Capital Conference is slated for Wednesday, April 20 at the Springfield Hilton Hotel in downtown Springfield. This is your opportunity to make your voice heard with your local legislators and banking regulators. In addition to hands on lobbying at the state Capitol, the agenda will include meetings with constitutional officers, legislative leaders and regulators. The day will begin with the annual luncheon and conclude with the very popular legislative reception.

    The cost for this event is only $100 per institution (after April 1, $150) and covers the cost for ALL, so please bring as many officers, directors, and employees as you wish. Registration will be available soon, so please SAVE THE DATE!

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    CBAI's 34th Annual Call on Washington Scheduled for April 24-27

    Call on Washington is CBAI's annual lobbying trip to our nation's Capital. For 33 years, community bankers from across Illinois have been traveling to Washington, D.C. to express their positions on issues to federal regulators and their members of Congress.

    This year’s Call on Washington will be held at the Hyatt Regency Washington on Capitol Hill in conjunction with ICBA’s 2016 Washington Policy Summit. Along with CBAI coordinated events, Illinois’ entire delegation is also invited to attend ICBA’s meetings and events. More details and registration will be available soon, so please SAVE THE DATE!

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    Investment News From THE BAKER GROUP

    Baker Market Update

    Retail sales fell by 0.1% in December. As a harbinger of fourth-quarter growth, that raises concerns about the momentum of consumer spending. For all of 2015, the 2.2% increase represents the weakest sales year since 2009. The perception of improving labor-market conditions was bolstered by a jump in the Fed’s Labor Market conditions Index to 2.9; up from the previous 2.7. See Baker Market Update.

    Baker Municipal Market Update

    Which States and Counties are Most Exposed to the Oil and Gas Sector?

    Given the natural lag in economic data, it’s too early to determine the degree to which oil-dependent counties are hurting. However, recent trends in the non-seasonally adjusted (NSA) unemployment rates for these counties are telling. See Baker Municipal Market Update.

    The Baker Group Webinar Series

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    Farm Loan Originations Remain Strong

    According to the Federal Reserve Bank of Kansas City, non-real estate farm lending remained strong in the fourth quarter, notwithstanding a modest decline year over year. Banks originated $101.4 billion for the quarter, down 9 percent from a year earlier. Loans used to finance current operating expenses remained at record levels, while volumes for most other types of non-real estate loans declined slightly. Meanwhile, demand for short-term loans, combined with renewed expectations of lower farm income highlighted mounting liquidity concerns for 2016. The report notes the average volume of operating loans in 2015 was 6 percent higher than 2014 and more than double the low mark set in 2011. See Kansas City Fed Report.

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    Consumer Confidence Bolstered in January

    Consumer confidence improved in January as expectations for the next six months improved moderately, the Conference Board reported. The Consumer Confidence Index rose to 98.1 from 96.3 in December. For now, consumers do not foresee the volatility in financial markets as having a negative impact on the economy, the Conference Board said. Read More.

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    CSBS-Fed Community Bank Research Conference Set for September 28-29

    The fourth annual CSBS-Federal Reserve Community Banking in the 21st Century Research and Policy Conference will take place September 28-29 at the Federal Reserve Bank of St. Louis. The research conference will bring together community bankers, academics, policymakers, and bank regulators to discuss the latest research on community banking.

    The CSBS-Federal Reserve research conference presents an innovative approach to the study of community banks. Academics explore issues raised by the industry in a neutral, empirical manner and present their findings at the conference. In addition, community bankers provide feedback that informs research and themes of the conference, contributing through a national survey, engagement with their state regulators throughout the year, participation on conference discussion panels, and by serving as keynote speakers at the conference.

    To learn more about the Community Banking in the 21st Century Research Conference, Click Here.

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    Midwest Office: Showcase Your Brand with the Most Powerful Form of Advertising!

    Take advantage of the Midwest Office Print & Promotional Products Division and gain access to thousands of products that can be customized, personalized and created for all of your business needs. We will work one-on-one with your bank to ensure a seamless experience when choosing between multiple products and getting the best quality and pricing available. Click Here to View the Specials and receive a $50 coupon off your next purchase of promotional products of $500 or more.

    Whether you are looking for marketing material to keep internally, or products for an upcoming social event or golf outing; Midwest Office can help bring together your brand and target audience to create memorable experiences that help grow your business. Using branded merchandise helps to engage, incentivize and inspire your audience by generating leads, building relationships and increasing market visibility.

    To place your next order, contact Midwest Office Sales Representative Kevin Gaffney at 217-303-5511 or email kgaffney@midwestoffice.com.

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    CBAI Education Foundation Is 20 Years Young – Give Us a High Five!

    This is the 20th anniversary year of the CBAI Foundation for Community Banking! More than $400,000 has been awarded in scholarships! EVERY CBAI MEMBER BANK CAN BENEFIT!

    Help us celebrate! GIVE THE FOUNDATION A HIGH FIVE! The Foundation’s “High Five” program is simple. Just $5 from each bank employee and $50 from each director is the aim of the program. Please participate and help the Foundation celebrate! Participate Here!

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    Five Mistakes Banks Must Avoid When Moving to Electronic Signatures

    Avoiding common mistakes other financial institutions make is important. Pay attention to the details and make the move for the right reasons. Make sure you don’t commit these costly errors. Read More.

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    Shaping the Message to Counter Megabanks

    Here’s one Massachusetts community banker’s approach to convince consumers to leave their megabank and come to his bank which remolded its product lineup and rebranded its image. Read More.

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    The 25 Worst Passwords of 2015

    Is your password on the list? SplashData has released its annual "Worst Passwords List" for 2015, shining a spotlight on what it calls the "insecure password habits of some Internet users." See the List.

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    CBIS Nicoud: What Credit Life and Disability Insurance Mean for Your E&O Policy

    One of the less-often alluded to consequences of the 1999 Gramm, Leach, Bliley Act is that the landmark banking bill paved the way for community banks to sell Credit Life and Credit Disability insurance to mortgage borrowers. Of course, those policies can help protect a borrower’s capability to make mortgage payments in the event of a death, or an injury that prohibits work.

    The policies can be a good safeguard for the right borrowers. And for some community banks, the products have proven to be an effective alternative profit center. Read More from CBIS Nicoud Insurance Services.

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    Make Your Hotel Reservations NOW for CBAI’s 42nd Annual Convention & Expo!

    The home for CBAI’s 42nd Annual Convention & Expo is the Kansas City Marriott Downtown, a premier convention hotel with a new lobby featuring three distinct, yet interconnected zones that allow guests to meet, work, socialize, and partake in various dining and entertainment options. Two distinct towers, the Marriott Tower and the Muehlebach Tower, offer 983 re-designed luxury guest rooms and nearly 100,000 square feet of diverse function space. With more than $30 million invested in the hotel’s transformation since 2012, the new, modern aesthetics feature high-tech functionality woven with a modern, urban-chic sophistication to create a state-of-the-art hotel. Innovative and functional highlights include an expedited elevator service, PV solar panels generating 50,000 watts of green energy for the hotel, and a high-speed Internet access infrastructure. The Kansas City Marriott Downtown is located in the heart of KC’s entertainment district. The nearby Power & Light District offers premier shopping, restaurants, and a vibrant nightlife.

    Book your room today for CBAI’s showcase event on September 15-17, 2016! Room rates are $159 plus tax for single or double occupancy. Call 800/303-0104 or visit HERE for reservations.

    Additional convention details will be available soon. For the more information on the Kansas City Marriott Downtown, please Click Here.

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    IRA Institute Scheduled for February 9 & 10

    Do you get an uneasy feeling in the pit of your stomach whenever a customer starts asking questions about IRAs? Do you know a little about IRAs but need more information? Would you have a hard time explaining the differences between a Traditional IRA and a Roth IRA? Would it be stressful for you to describe what a Recharacterization is to a customer? Have you ever looked at various IRA forms and not understood why the information that's being requested on them is necessary? Have you wondered if any of the rules have changed recently? If you answered “Yes” to any or all of the above questions then this two-day institute is for you. Leading this institute are Randy J. Heidmann and Robert Skomars, both consultants at Wolters Kluwer Financial Services. Details Here.

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    Deposit Documentation Slated for February 23-25

    The objectives of this seminar are to define the governing rules, regulations, and laws affecting deposit documentation; explain how the rules, regulations, and laws directly affect day-to-day operations and customer interactions; and show attendees how they can apply what they learn to new circumstances and situations. Each of these regulations, laws, or guidelines have aspects that relate to the initial disclosures, but the emphasis of this class is on the how and why. Many activities of tellers and customer-service representatives are driven by these regulations, but too often circumstances can make it difficult for those employees to apply the regulations because they don't know the details. This seminar describes the requirements, explains in a straightforward manner the basic principles, and then draws on real-life experiences to explore how to apply those principles. Tellers, head tellers, new-account representatives, and anyone opening accounts or dealing with customers on the deposit side would all benefit from attending this seminar. Tim Tedrick CRCM, CRP, and partner at Wipfli LLP in Sterling, IL, leads this seminar.

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    Commercial Lending Institute Set for February 23-25

    This three-day institute provides your commercial lenders with a solid foundation for producing and managing a quality loan portfolio. It focuses on analytical tools such as ratio, financial, cash flow analysis, as well as commercial loan structuring to enhance repayment capacity. Topics covered on day one include financial statement review, credit and ratio analysis, asset-conversion cycle analysis, and ratio interpretation. Cash budgeting, loan structuring, commercial loan documentation, and credit risk management are among the topics on day two. Day three examines cash-flow analysis, financial forecasting, and writing credit memos. Jeffery Johnson, president and founder of Bankers Insight Group, Atlanta, A, heads this faculty. He is joined Robert M. Swartz, manager, and Gary Genenbacher, CPA and partner, both of BKD, LLP.

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