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                      September 19, 2012 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois

  • CBAI Convention Begins Tomorrow in St. Louis!
  • CBAI Past Chairman Robin Loftus to Chair CFPB Council
  • FHLB Election: CBAI Backs Ashworth and Greenbank
  • CBAI and ICBA Support FDIC Director’s Call To Modify Basel III
  • ICBA’s Fine Assails Opponents of TAG Extension
  • FOMC Approves Third Round of “Quantitative Easing”
  • Baker Market Update
  • Mainstreet Economy Report for September Released
  • Director Cordray Meets with CBAI to Discuss CFPB's Activities
  • OCC Releases Summary of Bulletins for Second Quarter
  • ICBA Backs Exemptions from New Mortgage Rules
  • FDIC Releases Survey of Unbanked and Underbanked
  • Capital Planning Amid Evolving Regulations
  • How Sound Are Your Procedures To Prevent Embezzlement and Crime?
  • Plante Moran Releases Survey Results on Innovation
  • CBAI Member Shares Staff Training Technique
  • Global Cash-Flow Analysis Set for October 2 & 3
  • Consumer Lending Institute Scheduled for October 15-17
  • CDD Fall Meeting to be Held October 23
  • "ACH: Stay Informed and In Compliance" Scheduled in October


  • CBAI Convention Begins Tomorrow in St. Louis!

    CBAI’s 38th Annual Convention begins Thursday, September 20th with 240 bankers from 120 banks registered for this showcase event. In addition, the exhibit center is sold out with 96 firms demonstrating their products and services. Convention highlights will be posted daily on CBAI’s website at
    www.cbai.com.

    There’s still time to register, and CBAI offers one-day registrations. Please contact Rebecca Ridgeway at 800/736-2224 (Illinois Only) or 217/529-2265 to attend Friday and/or Saturday events.

    See each day’s schedule below:

    FRIDAY'S SCHEDULE
    Opening Breakfast
         "Off Balance, On Purpose"
         -author and renowned speaker Dan Thurmon

    Concurrent Education Sessions (including)
         "CBAI's Banking Law Update"
         "Seizing Opportunity in the Investment Portfolio"
         "Global Economic Outlook – Linkages to Agriculture and Community Banking"

    Business Meeting Luncheon

    Grand Opening of Exhibit Hall

    Concurrent Education Sessions
    (including)
         "Regulatory Hot Stuff"
         "Liquidity and Contingent Funding Management"
         "Loan Management and Enforcement: Improving the Odds of Recovery"

    Hospitality in Exhibit Center

    SATURDAY'S SCHEDULE
    Continental Breakfast in Exhibit Hall

    Concurrent Education Sessions
    (including)
         "An Executive Briefing"
         "Mortgage Loan Compliance in the Dodd-Frank World"
         "Succession Planning and Other Truths about Directors, Shareholders, and Regulators"

    Lunch & Recognition Program

    Concurrent Education Sessions
    (including)
         "Directors and Enterprise Risk Management"
         "BSA Lessons from the Trenches"
         "Appraisals and Valuations: Best Practices for Daily Operations"
         "Community Banking: Joining the Conversation with Social Media"

    General Session
         "Inside the White House and Hollywood: Getting to the Top with Character"
         -Steve Ford, successful actor and third son of former President Gerald Ford

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    CBAI Past Chairman Robin Loftus to Chair CFPB Council

    Robin Loftus, Executive Vice President and Chief Operating Officer of Security Bank, S.B., in Springfield, and Past Chairman of CBAI, will serve as chairman of the Consumer Financial Protection Bureau’s Community Bank Advisory Council.

    The CFPB was created by the Dodd-Frank Wall Street Reform Act and supervises depository institutions and credit unions with total assets of more than $10 billion. As a result the Bureau does not have regular contact with institutions with assets of less than $10 billion. The Council is intended to ensure that the unique perspectives of community banks are shared with the Bureau. The Council will provide the CFPB with recommendations to influence its policy development, research, rulemaking, and engagement functions. The Council will convene public meetings, and members serve two year terms.

    CBAI congratulates Robin Loftus on this important appointment.

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    FHLB Election: CBAI Backs Ashworth and Greenbank

    CBAI endorses the candidacies of Mr. Jim Ashworth and Mr. Art Greenbank for election to the Federal Home Loan Bank of Chicago Board of Directors. Ballots are expected next week!
    Read More.

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    CBAI and ICBA Support FDIC Director’s Call To Modify Basel III

    CBAI and ICBA have expressed support for FDIC Director Thomas Hoenig’s call for regulators to modify proposed Basel III capital standards because of their complexity. Their one-size-fits-all approach is not appropriate for community banks. Community banks maintain the highest capital levels in the banking profession and should not be subject to the same complex capital standards as the largest and riskiest institutions.
    Read ICBA News Release. Read Thomas Hoenig's Speech.

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    ICBA’s Fine Assails Opponents of TAG Extension

    ICBA President Cam Fine effectively counters an inaccurate assertion by the Wall Street Journal that the Transaction Account Guarantee (TAG) program should not be extended because it is a taxpayer-supported government bailout. Fine notes that in an era of too-big-to-fail government guarantees, a bank-funded deposit insurance program should not be on the chopping block.
    See Cam Fine Blog.

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    FOMC Approves Third Round of “Quantitative Easing”

    The Federal Reserve’s Federal Open Market Committee (FOMC) last week approved the purchase of additional agency mortgage-backed securities at a pace of $40 billion per month until substantial improvement in the labor market is achieved. The Committee also kept the target range for the federal funds rate at 0 to ¼ percent and anticipates retaining that range until at least mid-2015.
    See FOMC Release.

    During a press conference announcing the FOMC actions, Fed Chairman Ben Bernanke concluded that the tools available to the Federal Reserve will not be able to substantially lower the unemployment rate, noting that Congress must solve the fiscal cliff issue. See Forbes Article.

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    Baker Market Update

    The long wait is finally over. The FOMC announced plans for the release of its highly anticipated sequel to the wildly popular Quantitative Easing series. Rather than falling into the tired, old trap of merely numbering this third installment of monetary accommodation, these new asset purchases will be known as QE Infinitum since no ending date was specified by Chairman Ben Bernanke.
    Read More.

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    Mainstreet Economy Report for September Released

    The Mainstreet Economy Report, compiled and published by Creighton University economist Ernie Goss, includes findings from a monthly survey of community bank CEOs in several Midwestern states including Illinois. The latest report indicates that the Rural Mainstreet Index declined for the third straight month, and in Illinois it remained below growth neutral.

    The Report also noted that in July of 2009, there were 504 workers for every 1,000 Americans. In July of 2012, however, there were only 494 workers for every 1,000 Americans. The Report concluded that the U.S. has too many people in the economic wagon with too few pushing that wagon.
    See Full Report.

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    Director Cordray Meets with CBAI to Discuss CFPB's Activities

    CBAI's Bob Wingert, President; Jerry Cavanaugh, General Counsel; David Schroeder, VP of Federal Governmental Relations; and Mike Kelley, President of the Community BancService Corporation recently discussed CBAI's observations, concerns, and recommendations regarding the Consumer Financial Protection Bureau (CFPB) with Director Richard Cordray.
    Read More.

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    OCC Releases Summary of Bulletins for Second Quarter

    Each quarter the OCC issues a CEO Letter to national banks and thrifts that includes a summary of OCC Bulletins issued during the quarter. The second quarter 2012 CEO Letter also contains other supervisory and regulatory information.
    See OCC Summary of Bulletins.

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    ICBA Backs Exemptions from New Mortgage Rules

    Community banks were not responsible for the mortgage crisis, so their portfolio loans should be exempt from pending regulations on high-cost mortgages, ICBA told the Consumer Financial Protection Bureau. In a comment letter on proposed amendments to the Home Ownership and Equity Protection Act, ICBA said that the exemptions would help ensure that community banks are not driven from the mortgage market. Among its other recommendations, ICBA wrote that:
      • the CFPB’s definition of points and fees is too broad and should be clarified for open-end and closed-end credit
      • third-party and affiliate fees and employee compensation should not be included in the calculation
      • the bureau should allow financial institutions to correct unintentional violations
      • HOEPA regulations should allow community banks to continue to provide balloon payment mortgage loans if the loans are held in portfolio until maturity.
    Read ICBA Comment Letter. Read ICBA Release.

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    FDIC Releases Survey of Unbanked and Underbanked

    Last week the FDIC released the results of its
    2011 National Survey of Unbanked and Underbanked Households, which found that more than one in four U.S. households are either unbanked or underbanked, a slight increase from the 2009 inaugural survey. The report also showed that 30 percent of households do not have a savings account. See FDIC Release.

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    Capital Planning Amid Evolving Regulations

    In a recent blog post by Paula Eissfeldt of BKD, LLP, she offers useful guidance on the capital planning process, which is considered an integral component of an institution’s success.
    See Eissfeldt Article.

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    How Sound Are Your Procedures To Prevent Embezzlement and Crime?

    Community BancInsurance Services Powered by Nicoud offers some tips to help banks avoid losses from embezzlement and fraud.
    Learn More.

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    Plante Moran Releases Survey Results on Innovation Complete

    More than 550 organizations participated in the Innovation Quotient Survey this year, and 101 were financial institutions. Survey results indicate that top innovators find conferences, trades shows, and exhibitions, as well as professional associations important resources to support their innovation efforts. Survey data is designed to be a practical guide to innovation excellence.
    See Results.

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    CBAI Member Shares Staff Training Technique

    American Midwest Bank, Sycamore now sends daily information to train its employees. This training technique was submitted to CBAI for consideration by other banks.
    Read Document.

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    Global Cash-Flow Analysis Set for October 2 & 3

    “Global Cash-Flow Analysis” utilizes the Uniform Cash-Flow Analysis (UCA) method and provides guidance in calculating global cash-flow analysis for those entities that must rely on excess cash generated by their owners to service the business entity’s commercial debt. The course begins by defining cash flow as the tool to transform an accrual-basis financial statement into a statement of cash flow and its importance to bankers when considering a long-term loan request. It then proceeds to demonstrate how cash flow is calculated by utilizing the accounts on the balance sheet and the income statement to determine the sources and uses of cash from operating, investing, and financial activities. Next, a review of the owner’s personal financial statements and tax returns is presented in order to determine the excess compensation necessary to support the debts of the business entity and the individual. Leading this seminar is Jeffery Johnson, president and founder of Bankers Insight Group, Atlanta, Georgia, who has more than 25 years’ experience in the banking field.

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    Consumer Lending Institute Scheduled for October 15-17

    Sound credit decisions by community-bank lenders require a high degree of perception and skill. To reach this level of sophistication, lending personnel must constantly rethink existing approaches, research new ideas, and update their knowledge. To provide community banks with guidance and training, CBAI has developed the
    “Consumer Lending Institute.” This educational program provides essential knowledge and skills to lending professionals and establishes a network of lenders for continued support by sharing experiences with lending professionals. Topics covered include lending compliance, introduction to consumer lending, taking the loan application and interviewing, investigating the application, risk analysis, lending to self-employed borrowers, business development, loan documentation, and collections and bankruptcy. Leading this institute is David Kemp, president of Bankers Management, Inc., College Park, GA, a nationally recognized company in financial services training and bank consulting. Tim Tedrick, CRCM, CRP, and executive officer at Wipfli LLP in Sterling, Illinois, also presents at this institute.

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    CDD Fall Meeting to be held October 23

    The
    CDD Annual Fall Meeting, scheduled for October 23, 2012, at the I-Hotel & Conference Center, Champaign, is geared toward honing professional and banking skills. In addition to the educational offerings, this year's meeting includes a great networking opportunity at the hotel the evening of October 22nd, where the entertainment for the evening is, “Comedy Hypnosis with Cheryl.” The Fall Meeting begins with the popular Networking Session, a roundtable discussion among bankers sharing job responsibilities. This event is followed by a Legislative Update by CBAI's Kraig Lounsberry. Colleen Kettenhofen then presents her session entitled, “How To Tune-Up Your Team To Do Anything!” Following the Business Meeting Luncheon, the afternoon agenda features breakout sessions and a second Networking Session with roundtable discussions on a variety of topics. The Fall Meeting concludes with a general session by Kettenhofen entitled, “Achieving Personal & Professional Success: Renew, Refuel, Re-charge.”

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    "ACH: Stay Informed and In Compliance" Scheduled in October

    In the ever-changing world of ACH, it is difficult to stay abreast of the risks involved and the ever-changing rules. The presentation gives community bankers ideas for reducing risk and improving compliance. The ACH-Rule changes that became effective in 2011 and 2012 are also explained in a practical, easy-to-understand approach. This
    seminar identifies areas of ACH activity where a financial institution may be held liable if proper procedures are not in place. Fraud schemes occurring within ACH processing are outlined. In response to each risk or fraud identified, there will be solutions provided to mitigate the risk to both the financial institution and its account holders. The class provides attendees with ideas for policies and procedures that help protect the financial institution from unnecessary losses. Simplified procedures for maintaining compliance and tips for avoiding those commonly made mistakes are provided, as well. ACH-Rule changes that became effective in September 16, 2012 are explained in a practical, easy-to-understand approach. Sample written statements for unauthorized debits and stop-payment forms that comply with the new rules and limit the bank's liability under Regulation E are provided. Commonly made mistakes regarding ACH-Rules compliance will be identified as well. Nicole Meinhardt, CPA, MST, AAP and manager at Wipfli LLP, Sterling, Illinois, leads the seminar.

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