Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois Community Bankers Association of Illinois
 
     A Bi-Weekly News Bulletin for CBAI Members           September 23, 2009 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois


  • CBAI Convention Special Session Addresses ID Theft and Card Fraud
  • FOMC Likely to Keep Benchmark Rate Unchanged
  • ICBA's Cam Fine Addresses Financial Restructuring
  • ICBA Counters Consumer Financial Protection Agency Proposal
  • FDIC May Tap Credit Line at Treasury
  • House Panel Considers Bill to Expand CRA
  • SEC to Take on Bank of America in Court
  • BAKER Market Update
  • Economic Index Highest in 20 Months
  • Mainstreet Economy Remains Weak
  • Mortgage Delinquencies Set Record; Credit Card Delinquencies Down
  • Fed’s Duke: Accounting Reforms Should Reflect Traditional Banking
  • New CBAI Preferred Service Provider BankersEdge Presents Special Limited-Time Offer to Members
  • Register Now for CBAI’s Advanced Commercial Lending Institute
  • Governor’s Request for Agricultural Disaster Assistance Approved
  • TRIAD Delivers A-Rated Loans to CBAI Members
  • BAKER’S Advanced Portfolio Monitoring Helps Banks Manage Risk
  • FHA Announces Credit Policy Changes
  • OCC to Host Bank Director Workshops in St. Louis
  • CBSC and Affinion Offer Free Webinar to Increase In-Branch Sales
  • CBAI’s Advanced Bank Secrecy Act Officer Institute Announced
  • IDOA Pilot Program Launched for Grain Elevators


  • CBAI Convention Special Session Addresses ID Theft and Card Fraud

    CBSC and Affinion Group are hosting a special session at the CBAI Annual Convention titled “Everything You Ever Wanted To Know About Identity Thieves and How To Protect Your Community Bank”. Scheduled for Saturday, September 26, 2009, from 10:30am to 11:45am, this session features Dan Clements, President of CardCops, a division of Affinion Security Center. If Dan’s name sounds familiar, it may be because he appeared on NBC’s Dateline with Chris Hanson in a segment titled “To Catch An Identity Thief”. In this ground-breaking investigation, Dan exposed how criminals steal and sell credit and debit card information, then use that information to purchase goods and resell them for cash. And the entire event happens at a computer terminal!
    Plan now to attend!

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    FOMC Likely to Keep Benchmark Rate Unchanged

    The Federal Open Market Committee (FOMC) is not expected to change its main interest rate later today (September 23). Lending contracted for five straight weeks through September 9, which reflects regulatory orders to banks to raise more capital and toughen lending standards. Tight credit conditions impede economic recovery. For more information on economic conditions,
    click here.

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    ICBA's Cam Fine Addresses Financial Restructuring

    Will the Congress, too, forget the scorched economic landscape when the fires cool and it moves to another crisis? See Fine’s letter to members
    here.

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    ICBA Counters Consumer Financial Protection Agency Proposal

    On September 18, 2009, ICBA President Camden Fine
    questioned the need for a Consumer Financial Protection Agency in an op-ed article in “Roll Call,” the newspaper of Capitol Hill. He advanced the fact that community banks are the best protection for consumers in the financial system today.

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    FDIC May Tap Credit Line at Treasury

    FDIC Chairman Sheila Bair
    stated that the agency board will meet at the end of September to decide how to replenish the Deposit Insurance Fund, and tapping its line of credit with the Treasury will be considered.

    Senator Carl Levin (D-Mi) recently urged the FDIC to use its credit line rather than cause further harm to the bottom lines of smaller banks during this economic crisis. CBAI urges the FDIC to borrow from the Treasury on reasonable terms or at least use a combination of methods, including borrowing, to replenish the fund and reduce the immediate impact on community banks.

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    House Panel Considers Bill to Expand CRA

    House Financial Services Committee Chairman Barney Frank (D-Mass.) said his committee will take up legislation this year or next to expand the Community Reinvestment Act to include credit unions, mortgage companies, insurers, securities firms and affiliates of covered banks and thrifts. The Community Reinvestment Modernization Act (
    H.R. 1479), sponsored by Rep. Eddie Bernice Johnson (D-Texas), would also broaden the law by rating banks on their lending to minorities in addition to low-income borrowers.

    At a House Financial Services Committee hearing, Massachusetts Bank Commissioner Steven Antonakes said CRA review standards need to be strengthened for the largest financial institutions. “Efforts to further streamline examinations and compliance costs for small banks should be considered while a significantly more robust annual examination process should be undertaken for the top 20 bank lenders in the country,” he said.

    ICBA submitted a written statement commending Chairman Frank for removing CRA from the proposed Consumer Financial Protection Agency and urging policymakers to subject credit unions to CRA requirements.

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    SEC to Take on Bank of America in Court

    Bank of America now faces a trial with the Securities and Exchange Commission over billions in bonuses paid to employees of Merrill Lynch after it acquired the failing giant with government assistance in 2008. A U. S. District judge threw out B of A’s settlement offer and questioned why bank executives were not charged. He also said the settlement unfairly penalized shareholders.

    Meanwhile, the New York Attorney General is conducting its own investigation into the Merrill purchase and has been drafting what are likely to be civil fraud charges against top bank executives.
    More.

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    BAKER Market Update

    Wholesale and retail inflation rose more than expected. Retail sales jumped in August. Fed Chairman Ben Bernanke and San Francisco Fed President Janet Yellen believe the recession is “very likely over.”
    More.

    The Baker Group is a CBSC Preferred Provider.

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    Economic Index Highest in 20 Months

    On September 21, 2009, the Conference Board
    announced that its August index of leading economic indicators climbed to its highest level since January of 2008. The index is supposed to forecast economic trends six to nine months ahead. Concerns, however, were raised that high unemployment and growing mortgage delinquencies could undermine a recovery.

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    Mainstreet Economy Remains Weak

    The overall index for the Rural Mainstreet Economy expanded for the first time since June of this year, but it continues to show material economic weakness, according to the September survey of community bank CEOs in an 11-state region. The index has remained below growth neutral for 19 consecutive months.

    Pullbacks in farm income tied to commodity prices appear to be restraining growth. With 2009 farm income under pressure, both land prices and sales of farm equipment have weakened over the past several months.
    More details here.

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    Mortgage Delinquencies Set Record; Credit Card Delinquencies Down

    High unemployment has increased mortgage delinquencies to a record 7.58 percent that were at least 30 days late on payments in August. However, credit card delinquencies were down in August for the third straight month.
    More.

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    Fed’s Duke: Accounting Reforms Should Reflect Traditional Banking

    Federal Reserve Board Governor
    Elizabeth Duke said policymakers need to coordinate accounting rules to avoid limiting the flow of credit. In a speech to the American Institute of Certified Public Accountants, Duke said proposals by the Financial Accounting Standards Board and International Accounting Standards Board diverge in important ways, and neither would accurately reflect the traditional commercial banking model.

    Duke said the FASB and IASB plans would favor the “originate-to-distribute” business model predicated on the trading of financial instruments for the realization of value, not the “originate-to-hold” model based on the realization of value through the return of principal and yield over the life of the financial instrument.

    She said an accounting regime should directly link reported financial condition and performance with the business model and economic purpose of a firm.

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    New CBAI Preferred Service Provider BankersEdge Presents Special Limited-Time Offer to Members

    CBAI is pleased to
    introduce BankersEdge as the newest preferred service provider. The strategic partnership between two recognized industry leaders will provide unmatched products and services to CBAI members.

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    Register Now for CBAI’s Advanced Commercial Lending Institute

    "CBAI’s Advanced Commercial Lending Institute,” a three-day institute, is being
    offered in Springfield on October 7-9. Risk assets typically compose 50 to 80 percent of a community bank’s total assets. Asset quality is viewed by the investment community to establish the bank’s value, and it forms the basis of capital requirements assigned by the regulators. Therefore, managing the commercial loan portfolio is extremely important for the overall health of a financial institution. This three-day school is designed to provide the more experienced lenders with the tools necessary to ensure a quality loan portfolio from analyzing promising prospects or customers, to loan approval, to loan documentation, and finally to credit administration. Topics covered include advanced ratio analysis, loan structuring, analyzing borrowing causes, cash flow analysis for commercial and industrial loans and commercial real estate, financial forecasting and sensitivity analysis, and calculating sustainable growth and break-even points. Analyzing specialized credit, managing the commercial lending relationship, loan documentation, credit administration topics, and more are also covered.

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    Governor’s Request for Agricultural Disaster Assistance Approved

    The U. S. Department of Agriculture recently
    approved Governor Quinn’s request to designate 58 counties as natural disaster areas. It qualifies farmers in those counties and 30 contiguous counties for USDA assistance as a result of crop losses from heavy rains and flooding earlier this year.

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    TRIAD Delivers A-Rated Loans to CBAI Members

    Since the Program’s introduction in December of 2006, three-dozen CBAI member banks have purchased approximately $130 million in manufactured loans from Triad Financial Services. The most recent loan purchases generated yields of seven-and-a-half to eight percent to participating banks, and no losses!
    More.

    TRIAD is a CBSC Preferred Provider.

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    BAKER’S Advanced Portfolio Monitoring Helps Banks Manage Risk

    The risk profile of a bank's investment portfolio should reflect the goals of the bank. APM® software helps manage that risk—and more! APM® allows the bank to better manage its portfolio and comply with regulations with ease. APM® analyzes and graphically displays information for all types of bank-eligible fixed income securities, including mortgage-backed securities, CMOs and callable a Plus, and
    click here to read more.

    The Baker Group is a CBSC Preferred Provider.

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    FHA Announces Credit Policy Changes

    On September 18, 2009, the Federal Housing Administration (FHA)
    announced credit policy changes to enhance the agency’s risk management functions. The FHA also intends to hire a Chief Risk Officer for the first time in its 75-year history.

    The FHA’s capital reserve ratio is expected to drop below the congressionally-mandated threshold of two percent, and the agency stated that the announced changes will strengthen reserves.

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    OCC to Host Bank Director Workshops in St. Louis

    The Comptroller of the Currency will host a workshop for national community bank directors at the Hilton St. Louis at the Ballpark on November 2-4, 2009. The information is geared to directors of national banks with less than $1 billion in assets who have less than three years of experience.
    More.

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    CBSC and Affinion Offer Free Webinar to Increase In-Branch Sales

    In today’s economy it is increasingly imperative that your frontline employees not only have strong product knowledge but also understand how to effectively engage account holders and prospects alike. This FREE webinar addresses how frontline performance can be accelerated to:

         •Acquire new account-holders
         •Retain your current account-holders
         •“Stand out” from your competition
         •Increase cross-sell opportunities

    Click here for more information and to register to attend.

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    CBAI’s Advanced Bank Secrecy Act Officer Institute Announced

    "CBAI’s Advanced Bank Secrecy Act Officer Institute,” a three-day institute, is scheduled for October 5-7, 2009, at CBAI Headquarters. This
    institute focuses on the BSA compliance needs of community banks and community bank BSA officers. While the regulation is discussed the focus of the institute is on the bank’s response to the regulation. Topics include risk assessment, preventive and detective controls, the BSA examination manual, annual BSA reviews, preparing for a BSA examination, OFAC, customer due diligence, money service businesses, BSA and the board of directors, and training issues. Each day’s agenda contains some lecture segments; however, significant time is allotted to case studies. The case studies are based on real-life bank situations, and allow the attendees to participate in creative and detailed BSA problem solving which further enhances the understanding of the regulation. These exercises are designed to help all attendees consider additional approaches to the BSA issues that each attendee faces in their own bank. BSA officers, audit staff, senior managers, and BSA operations personnel should attend.

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    IDOA Pilot Program Launched for Grain Elevators

    The Illinois Department of Agriculture (IDOA) has started a pilot program that is intended to produce a more accurate accounting of both the quality and quantity of stored grain. The program may result in grain elevators conducting their own monthly grain inventories.
    More.

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    CBAI

           

    CBAI's PROFESSIONAL DEVELOPMENT PROGRAMS THROUGH 11/15/09



    TELEPHONE/WEBCASTS THROUGH 10/31/09




    Other CBAI Events

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    11/17-28 CBAI's Women in Banking Conference, Springfield

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