Community Bankers Association of Illinois
Community Bankers Association of Illinois    Community Bankers Association of Illinois CBAI E-Newsletter Sponsor - SHAZAM
 
     A Bi-Weekly News Bulletin for CBAI Members                           May 30, 2012 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois

  • Illinois General Assembly Scheduled to Adjourn Thursday
  • Earnings at Insured Institutions Continue to Improve
  • Former FDIC Chief Bair: JP Morgan Worth More in Pieces
  • Regulators Questioned in JP Morgan Loss
  • Bill Introduced to Downsize Four Largest Banks
  • TAG Extension Needed to Keep $1.3 Trillion in Community Banks
  • Baker Market Update
  • CBAI FedPac Needs Your Support - Let’s Play Ball!
  • Sageworks: White Paper - Challenges in the Estimation of the ALLL
  • E-Newsletter Helps Banks Reach Business Customers
  • Community Banks Leaving SEC
  • Diebold’s Webinar Series: the Evolution of ATM Channel Management
  • Save 25 Percent from DieboldDirect On Teller Appreciation Day
  • CBAI’s 2012 Group Meetings are Underway! Register Today!
  • 25th Community Bankers School Set for July 15-20
  • Information Security Summit Scheduled for June 5 & 6
  • Ag Lenders’ Conference Set for June 6
  • Enterprise Risk Management Scheduled for June 15 & 22
  • Case-Shiller: Home Prices at Historic Lows in Q1


  • Illinois General Assembly Scheduled to Adjourn Thursday

    The Illinois General Assembly is scheduled to adjourn the Spring legislative session on May 31. The pieces seem to be falling into place to accomplish this goal, but there is still some time for things to fall apart. Last Friday, CBAI released its latest
    News From the Front (NFTF) that summarizes some of the issues remaining this week.

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    Earnings at Insured Institutions Continue to Improve

    First quarter earnings at insured banks reach $35.3 billion, marking the 11th consecutive quarter that earnings have registered a year-over-year increase. However, loan balances declined by $56.3 billion after three consecutive quarterly increases. Also, approximately 10% of all banks reported net losses compared to about 16% a year earlier.
    See FDIC Release.

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    Former FDIC Chief Bair: JP Morgan Worth More in Pieces

    Last week former FDIC Chairman Sheila Bair announced that the mega banks should be broken up to benefit all involved and create a more efficient and safer financial services industry. CBAI and ICBA also support downsizing the nation’s mega banks to mitigate the effects of another financial crisis and avoid another taxpayer-funded bailout of Wall Street firms.
    See Moneynews Article.

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    Regulators Questioned in JP Morgan Loss

    Despite the fact that about 40 Federal Reserve examiners and 70 OCC staff members are embedded in JP Morgan Chase, the nation’s largest bank, none of them were assigned to the bank’s trading unit that recently incurred billions of dollars in losses. Now academicians and members of Congress are suggesting that big bank officials may have excessive influence over the regulators, and a greater separation should be established.
    See New York Times Article.

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    Bill Introduced to Downsize Four Largest Banks

    Earlier this month, Senator Sherrod Brown of Ohio introduced the Safe, Accountable, Fair and Efficient Banking Act (SAFE Banking Act), which would require the four largest banks to downsize, thereby making them small enough to fail without causing a global economic panic. In an opinion piece penned by Simon Johnson, economics professor at MIT, he expresses support for the measure and cites the reasons why it should be enacted.
    See New York Times Articles.

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    TAG Extension Needed to Keep $1.3 Trillion in Community Banks

    ICBA announced last week that if Congress fails to extend the Transaction Account Guarantee (TAG) coverage, then $1.3 trillion in deposits will become uninsured and trigger disintermediation from Main Street banks to the too-big-to-fail Wall Street banks. CBAI and ICBA are seeking a temporary five-year extension for non-interest bearing transaction accounts through 2017.
    See ICBA Release.

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    Baker Market Update

    Events across the sea continued to be the primary influencing factor in this week’s behavior of domestic credit markets. As European Union leaders participated in their 18th summit meeting in just the last two years, it’s difficult to know if what we’re seeing is history, or hysteria, in the making.
    Read More.

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    CBAI FedPac Needs Your Support - Let’s Play Ball!

    Baseball season has begun and so has CBAI FedPac’s Fundraising season.
    Where: Busch Stadium in St. Louis
    When: Thursday, July 26, 2012 at 12:45 p.m.
    Who: St. Louis Cardinals vs. Los Angeles Dodgers
    Why: To keep community banking in the game
    How: Contact Jessie Schmidt today at 800/736-2224 to secure your tickets

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    Sageworks: White Paper
    Challenges in the Estimation of the ALLL


    The estimation of the Allowance for Loan and Lease Losses (ALLL) has been part of bank accounting processes for years, but it has taken on increased importance over the last several years. Between increased regulatory scrutiny and the challenges of documenting and defending the Allowance estimation to multiple constituencies including the regulators, external auditors, and the board, many financial institutions find themselves overwhelmed with the process of estimating and documenting the ALLL on a monthly or quarterly basis. The ALLL estimation is significant in that regulators are vigilant about ensuring that financial institutions have enough in their reserves, but the ALLL estimation is also significant in its impact on an institution’s earnings and capital.

      • Challenges in the Estimation of the ALLL
      • 3 Three Steps to Evaluating a FAS 5 Methodology
      • 7 Challenges and Improvements in the FAS 114 Impaired Loans Reserve Calculation
    Follow the attached link to view the entire white paper “
    Challenges in the Estimation of the ALLL.” Sageworks is a CBSC preferred marketing partner that provides a suite of commercial-loan analysis tools which spread financial data for multiple business entities producing a true global cash-flow analysis, real-time industry comparisons, and a narrative report.

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    E-Newsletter Helps Banks Reach Business Customers

    For the past two months, Synergetic Publications has offered CBAI members the opportunity to test a proven e-strategy, the use of its electronic newsletter, Your Business. The April and May editions were sent at no charge to CBAI members as an easy way to test a new marketing tool that will enhance market presence. At a recent marketing gathering, speakers encouraged the use of electronic communications with clients as a regular and effective part of banks’ marketing strategy. Whether sent to the top 25 business customers or 500 regional prospects, there is no disputing the value of communicating with customers through this powerful medium.

    The free trial period is now over. This program is easy-to-use and cost effective. For more information on how to use this bank-to-business newsletter and/or to order the June edition or an annual subscription, visit
    www.synpubinc.com today. By ordering your next edition, CBAI members will be able to offer uninterrupted service to their small-business customers.

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    Community Banks Leaving SEC

    More than two dozen community banks and thrifts have announced that they will deregister with the Securities and Exchange Commission following the passage of the Jumpstart Our Businesses (JOBS Act),
    according to a new report. The law includes a provision from the ICBA-advocated Communities First Act that adjusts the SEC’s deregistration threshold from 300 to 1,200 and raises the registration threshold from 500 shareholders to 2,000. Many community banks are expected to follow the 25 that have already announced they will deregister to reduce compliance costs.

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    Diebold’s Webinar Series: Evolution of ATM Channel Management

    Today, many financial institutions are focused on improving the consumer experience, reducing costs, and generating revenue through their self-service channels. Ask yourself six questions, beginning with:

         • Does your financial institution offer consumer personalization at the ATM such
           as fast cash or receipt or no-receipt preferences?
         • How quickly can you detect and resolve ATM availability issues?

    To find out the other four questions, and learn more,
    click here.

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    Save 25 Percent from DieboldDirect On Teller Appreciation Day

    Wednesday, June 6, 2012, is the second annual
    DieboldDirect Teller Appreciation Day. To thank valued tellers for their hard work and great service, Diebold is offering a one-day-only 25 percent off special.

    Now is the perfect time to make your branch more efficient and your tellers’ jobs easier. Take advantage of the savings by stocking up on ATM essentials, including paper, cassettes, ink/ribbons and deposit envelopes.

    How to save 25 percent on June 6: Visit DieboldDirect.com and use coupon code TELLER1 when checking out. To order by phone, call 800-222-6900 and mention “Teller Appreciation Day.”

    *Some exclusions apply: The 25 percent discount is valid Wednesday, June 6, 2012. This discount cannot be used on the Magner Model 809 Self-Service Coin Sorter, custom products or in combination with other discounts.

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    CBAI’s 2012 Group Meetings are Underway! Register Today!

    CBAI’s 2012 Group Meeting tour
    is underway! Consisting of an optional golf outing and a dinner meeting, Group Meetings also provide an excellent opportunity to get the latest information on key banking issues and catch up with friends and peers. CBAI President Bob Wingert provides updates on Association projects and community banking in general, and Senior Vice President of Governmental Relations Kraig Lounsberry offers an up-to-the-minute report of banking-related legislative activities. Then Jim Hillestad or John Immordino of Community BancInsurance Services powered by Nicoud Insurance Services presents, “What You Don’t Know About Your Community Bank’s Insurance Coverage Can Hurt You.” Meetings for Groups 4, 7, & 12 are still to come! Register for the meeting in your area today! For information regarding the Group Meeting in your area or to register, please click here.

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    25th Community Bankers School Set for July 15-20

    The Community Bankers School, which consists of two, one-week sessions over a two-year period at Illinois Wesleyan University in Bloomington, prepares students to immediately contribute to the overall success of their banks, and imparts the knowledge necessary to get ahead. Topics covered during this intense week for Class I participants includes compliance, accounting, commercial and consumer loan documentation, collections, bank security, auditing, investments, and technology; while Class II focuses on management aspects. However, the benefits extend beyond the classroom with outside case studies, an invaluable student notebook with supplemental materials, as well as networking opportunities with peers, instructors, and senior bankers. Students gain solid experience for broader responsibilities and greater effectiveness, as well as insight into a community bank’s overall operations responsibilities. The deadline to enroll is July 1, 2012. For more information or to register, please
    click here.

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    Information Security Summit Scheduled for June 5 & 6

    This
    summit will benefit operations and technology officers, security officers, and anyone responsible for risk management of a community financial institution's information technology department. Key topics covered in the one-day seminar include top threats of 2012 to the financial sector; penetration testing; mobile security; balancing compliance with common sense to secure your banking data; and disaster recovery: planning ahead to prevent a disaster. This program will be presented by Jeff Multz, CFS, director, North America Midmarket Sales, and Andre Robitaille, solutions architect, Security and Risk Consulting for Dell SecureWorks.

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    Ag Lenders’ Conference Set for June 6

    Attend CBAI’s 2012
    Ag Lenders’ Conference to develop the skills and tools to better understand the issues affecting your farm and agribusiness customers and to meet their credit needs. Topics and speakers include economist and futurist Dr. Jay Lehr, who will present “Coping with Volatility on Today’s Farm, Ranch, and Dairy” and “Overcoming Obstacles Through Personal Involvement;” Dr. Michael Boehlje, professor of Agricultural Economics, Purdue University, West Lafayette, IN, who will examine “Lending to Today’s Commercial Farmer: Managing the Risk and Maintaining the Customer;” and a Regulatory Panel. A mini-expo featuring the latest in products and services for ag lenders will also highlight the day.

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    Enterprise Risk Management to be Held June 15 & 22

    For compliance reasons, community banks have been exploring
    enterprise risk management (ERM). Learn how to improve the effectiveness of the bank’s risk management efforts to keep pace with changing business practices and strategies. This session will discuss the definition of ERM and explore the basic elements of an ERM framework. Much of the ERM components at a community bank are already in place, though they may need to be refocused, further documented, and/or enhanced. Instructors will look at how community banks can develop a risk culture grounded in the ERM principles leveraging existing risk practices at the bank. Leading this seminar will be Eileen Iles, CPA, CGMA, CIA, CFSA, CCSA, CRMA, partner, Risk Services, at Crowe Horwath LLP in Oakbrook Terrace, IL.

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    Case-Shiller: Home Prices at Historic Lows in Q1

    Home prices reached historic lows at the end of the first quarter of 2012, according to the
    S&P/Case-Shiller home price indexes. The national composite fell by 2 percent in the first quarter and was down 1.9 percent from a year ago. The 10- and 20-city composites declined by 2.8 percent and 2.6 percent, respectively, in March.

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    CBAI
    ACT Appraisal

    PROFESSIONAL DEVELOPMENT PROGRAMS THROUGH 7/15/2012


    TELEPHONE/WEBCASTS THROUGH 7/15/2012


    CBAI EVENTS

    CBAI Ag Lenders' Conference
    June 6, Crowne Plaza, Springfield


    July 15-20, Illinois Wesleyan University, Bloomington

    CBAI FedPac Cardinals-Dodgers Ballgame Fundraiser
    July 26, St. Louis, MO
    Contact Jessica Schmidt, jessicas@cbai.com or 800/736-2224 for more information.


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