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                         October 17, 2012 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois

  • CBAI Issues Comment Letter on Basel III
  • Recognized Consultants Call for Small Bank Exemption from Basel III
  • FHLB 2012 Director Election - Have you voted yet?
  • FHLB Chicago Announces Third Quarter Financial Results
  • Bair Authors Revealing Book on Financial Crisis
  • Support Grows for Enactment of Lighter Version of Glass-Steagall
  • ICBA’s Cam Fine Offers Reasons to Support Hoenig Proposal
  • ICBA’s Thomas Urges Safe Harbor from New Mortgage Regulations
  • CBAI Foundation Announces New Scholarship to Bankers School
  • SHAZAM Scholarship Increased to Four Years
  • It’s Renewal Time for the Community Bankers for Compliance (CBC) Program
  • CDD Fall Meeting To Be Held October 23rd
  • FHFA Proposes New Secondary Mortgage Market Infrastructure
  • Baker Market Update
  • CBSC Salutes Marketing Partners Named to FinTech’s 100
  • IB Magazine Seeks Banker Input for Lender Life Column
  • CFO Conference Scheduled for October 24 & 25
  • Lending to the Self-Employed Borrower Set for October 31 & November 1
  • Seminar for the Community-Bank Attorney Scheduled for November 2


  • CBAI Issues Comment Letter on Basel III

    CBAI has responded to the regulators with specific recommendations regarding a dozen of the proposed Rules that most negatively impact community banks in addition to renewing its call for a community bank exemption to Basel III.
    Read CBAI's Final Comment Letter.

    CBAI is committed to vigorously represent your interests with the banking regulators on Basel III. It is vital that you become familiar with the proposed rules covering new capital requirements and asset risk weights. If implemented as proposed, these rules may endanger the existence of your community bank.

    Your opportunity to inform the regulators about their impact on your bank and to help shape the rules will expire on October 22nd. Your voice must be heard! Now is the time to speak-up.

    Find instructions for submitting your own comment letter and more at CBAI's Basel III Resource Center.

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    Recognized Consultants Call for Small Bank Exemption from Basel III

    Well-known and respected banking consultants Bert Ely and Alex Pollock this week called on regulators to exempt all community banks from the proposed Basel III requirements. They also pointed out that because credit unions are exempt, so should community banks. CBAI also advocates exempting community banks from Basel III.
    See Article.

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    FHLB 2012 Director Election - Have you voted yet?

    There is still time to send in your ballot to ELECT JIM ASHWORTH and ART GREENBANK to the Federal Home Loan Bank of Chicago Board of Directors. If you have not received your ballot or if it has been lost or misplaced, please call (312) 565-5374 for a replacement. CBAI encourages all community banks that belong to the FHLB of Chicago to please participate in this important election. Ballots must be received at the FHLB of Chicago by the close of business on Friday, October 26.
    Read More.

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    FHLB Chicago Announces Third Quarter Financial Results

    The FHLB Chicago this week reported net income of $90 million for the third quarter, driven by strong net interest income and a reduced OTTI charge on its private label MBS portfolio. The year-to-date net income for the bank is $275 million.

    Retained earnings climbed to nearly $1.6 billion, up 21% since the first of the year. As a result, the bank has repurchased and redeemed $1.4 billion of excess capital stock since late last year. The bank announced it plans to repurchase another $100 million of member stock on November 15, 2012, and members have until October 31st to request repurchase of their shares.
    See Third Quarter Report.

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    Bair Authors Revealing Book on Financial Crisis

    Former FDIC Chairman Sheila Bair has released “Bull by the Horns,” a revealing and occasionally scathing report on her experience as a regulator during the financial crisis. She notes that the balance of power has shifted too far in favor of large financial interests in Washington. In her book, Bair offers 13 actions to make banks stronger and regulators more effective, including breaking up the mega banks and ending the revolving door between Wall Street and its regulators. CBAI applauds Ms. Bair's straight talk at a time when it is sorely needed.
    See New York Times Article.

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    Support Grows for Enactment of Lighter Version of Glass-Steagall

    Support continues to grow for reinstatement of restrictions separating commercial and investment banking which were removed in 1999 upon passage of the Gramm-Leach-Bliley Act. Less than 10 years later, excessive risk-taking by Wall Street mega firms contributed materially to a devastating financial and economic crisis.

    FDIC board member Tom Hoenig recently offered a plan to prohibit FDIC-insured banks from operating the riskier trading units that in the crisis greatly increased the government’s exposure. Banks would be allowed to continue to offer asset management and issue stocks and bonds, however. ICBA and CBAI are prepared to support legislative steps to implement the Hoenig proposal. (See Next Article)

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    ICBA’s Cam Fine Offers Reasons to Support Hoenig Proposal

    In his most recent “Fine Points,” ICBA President Cam Fine presents compelling reasons to support the Hoenig proposal to enact a new version of Glass-Steagall which could end too-big-to-fail.
    See Fine Points Article.

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    ICBA’s Thomas Urges Safe Harbor from New Mortgage Regulations

    To ensure that mortgage credit is not restricted in Main Street communities, ICBA’s Karen Thomas is urging the CFPB to implement a broad legal safe harbor to protect community bank portfolio lenders under the new mortgage standards.

    Emphasizing that community banks did not engage in the risky behavior that caused the mortgage crisis, Thomas noted that borrowers could challenge in court a bank’s compliance, and without a safe harbor community banks would face increased risk of litigation they cannot afford. CBAI is in full support of ICBA’s position.
    See BankThink Article.

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    CBAI Foundation Announces New Scholarship to Bankers School

    A new scholarship is now available which provides an opportunity for CBAI member bankers to attend the Community Bankers School (CBS), held annually at Illinois Wesleyan University in Bloomington, IL. Designed as a two-year program (one week per year), CBS provides a broad-based curriculum of bank-related topics for the banker moving up through the ranks, and directors and senior officers looking for a “refresher.”

    This scholarship is made possible by corporate donations to the CBAI Foundation for Community Banking. The first donation to endow this new scholarship was made by THE BAKER GROUP.

    CBAI member banks that have contributed/pledged at least $2,500 to the Foundation are eligible to submit the name of the bank in the annual drawing to send an employee to the CBS. The number of times that a bank's name may be entered each year for this scholarship is scaled according to the amount of its donations. For more information, contact Andrea Cusick at
    cbaicom@cbai.com or 800/736-2224.

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    SHAZAM Scholarship Increased to Four Years

    The CBAI Foundation for Community Banking is pleased to announce a major enhancement of the SHAZAM® Scholarship, to a four-year scholarship. The winning student may receive $1,000 per year for up to four years of higher education, subject to the fulfillment of eligibility criteria. Previously, the scholarship was a $2,000, one-time payment to the winning student. The SHAZAM Scholarship was presented for the first time in 2007; to date, $12,000 has been awarded to deserving high-school students.

    Students eligible for this scholarship are those who are the children or grandchildren of an employee, officer, or director of a CBAI member banker; also included are part-time student-employees at an eligible CBAI member bank. CBAI member banks that have contributed/pledged at least $2,500 to the Foundation are eligible to submit name(s) of students for the annual drawing. The number of nominees that a bank may enter each year for this scholarship is scaled according to the amount of its donations. For information, contact Andrea Cusick at
    cbaicom@cbai.com or 800/736-2224.

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    It’s Renewal Time for the Community Bankers for Compliance (CBC) Program

    Community bank are faced with a bewildering array of ever-changing regulations. While all banks strive to be in compliance, the regulatory requirements can be overwhelming, and most community banks do not have the time or money to build elaborate compliance systems.

    In response, CBAI has teamed with Young & Associates of Kent, OH to offer “The Community Bankers for Compliance” (CBC) program. Now beginning its 24th year, this program provides a cost-effective approach to obtaining up-to-date information on bank regulations and practical techniques for maintaining an effective compliance program. The Community Bankers for Compliance program can simplify your compliance challenge. The topic for the
    First Quarterly Compliance Meeting is “The Important Rules That Are NOT Scheduled to Change – Lending!”

    This year, CBAI is offering several enhancement options to the CBC program which are highlighted on the CBC renewal brochure insert. You can choose to register for the basic CBC program, which has no change in pricing or benefits from the previous CBC program, or you can choose to add on additional tiered enhancement options. If you have any questions regarding these new options, please contact Valerie Johnston at CBAI at 800/736-2224 or by e-mail at valeriej@cbai.com.

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    CDD Fall Meeting To Be Held October 23rd

    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 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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    FHFA Proposes New Secondary Mortgage Market Infrastructure

    The
    Federal Housing Finance Agency is seeking public input on a proposed framework for a common securitization platform and a model pooling and servicing agreement. The FHFA white paper seeks to identify the core components of mortgage securitization that will be needed in the housing finance system going forward.

    The agency said the core components are linked to two cornerstone operational features:
      • a securitization platform to process payments and perform other functions that could be used by multiple issuers, and
      • a contractual framework supporting the new infrastructure.
    The agency said developing a new securitization infrastructure is top priority and builds on other initiatives to align and improve the business practices of Fannie Mae and Freddie Mac. Public input must be received by December 3.

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    Baker Market Update

    Malarkey! That is apparently what participants in the most recent consumer confidence survey think about economic nay-sayers. Released last week, the University of Michigan’s Index of Consumer Sentiment surged to a reading of 83.1 from last month’s 78.3; significantly above the market’s expectation of 78. The reasons behind the big jump might be up for debate, but many market observers credit rising home and equity prices along with perceived improvements in the labor market as the main drivers behind the psychological boost.
    Read More.

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    CBSC Salutes Marketing Partners Named to FinTech’s 100

    Five CBSC marketing partners were named among FinTech’s top 100 technology service providers to financial institutions as selected by American Banker and Bank Technology News. CBSC is a wholly-owned affiliate of CBAI.

    #1
    FIS (Processor for CBSC/ICBA BANCARD credit card program);
    #6 DIEBOLD (ATMs, and security equipment);
    #39 WOLTERS KLUWER, (deposit and lending automation and compliance services);
    #44 HARLAND FINANCIAL SOLUTIONS (checks and marketing); and
    #60 COMPUTER SERVICES INC. (Web portal services).

    Click here for more information on CBSC Marketing Partners.

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    IB Magazine Seeks Banker Input for Lender Life Column

    The editors of ICBA Independent Banker magazine are seeking banker input to help shape future issues of the magazine's Lender Life column. Lender Life encompasses everything from consumer lending to commercial lending to agricultural lending. Topics can focus on the
    mortgage industry and housing market, technology that affects lending, or products and services such as credit cards or credit insurance. If your community bank is doing something unique in the lending arena and would like to be featured please contact the IB editors. Additionally, if there is an aspect of lending that you would like to see more in-depth reporting or converge on, please let ICBA know. More Information:
      • Contact IB's editors with your story ideas.
      Visit the ICBA Independent Banker magazine website.
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    CFO Conference Scheduled for October 24 & 25

    CBAI is pleased to offer its first-ever
    “CFO Conference” in two locations this October. The first session, Investments & Asset Liability Management with Drew Simmons of THE BAKER GROUP, focuses on the bond portfolio's role in managing an institution's interest rate risk in the context of the entire balance sheet. Capital Raising with Tim Sullivan, Hinshaw & Culbertson, and John Donnelly, Penman and Partners, deals with all facets of raising capital. Objectifying the ALLL Factor with Matt Bolinger of Wipfli LLP, discusses a common-sense approach to objectively identifying and quantifying qualitative/quantitative factors to support the appropriate level of the ALLL. The day concludes with a Legal Recap with CBAI General Counsel Jerry Cavanaugh. This session addresses recent legislative enactments, new regulations, policies, guidelines and interpretations of state and federal regulatory agencies, and judicial case-law developments that affect operations of state-chartered and national banks in Illinois.

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    Lending to the Self-Employed Borrower Set for October 31 & November 1

    CBAI is pleased to offer
    “Lending to the Self-Employed Borrower” in two locations. This program covers both personal and business tax returns. It takes a look at small business and self-employed borrowers. Cash-flow and global-debt analyses are covered. The primary focus is on converting taxable income into effective income. The class employs lecture and case studies. Each participant should bring a calculator to class. The program covers sole proprietorships, partnerships and LLCs, corporations, and Sub Chapter – S corporations. Other topics to be covered include evaluating rental income, interest and dividend income, capital gains and losses, and commission income-earners. Leading this seminar is David Kemp, president of Bankers Management, Inc., College Park, GA, a nationally-recognized company in financial services training and bank consulting.

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    Seminar for the Community-Bank Attorney Scheduled for November 2

    To help community-bank attorneys obtain the latest information regarding the myriad of legislative, legal, and regulatory mandates facing community banks, as well as to meet the Supreme Court of Illinois-ordered requirements for Minimum Continuing Legal Education (MCLE), CBAI developed this comprehensive one-day education session entitled, “
    Seminar for the Community-Bank Attorney,” scheduled for Friday, November 2, 2012. This seminar utilizes the expertise of a number of attorneys who specialize in banking law and related topics and provides 5.5 hours of MCLE credit for attendees. It provides an update on state laws and court cases impacting community banks; recent developments in the trust arena; ag lending, workouts, and bankruptcies; raising capital; representing a secured lender; and more! Any attorney who sits on a community bank board of directors, acts as legal counsel to a community bank, or has an interest in these topics would benefit from attending.

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