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                October 21, 2009 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois


  • FHLB of Chicago Director Election - Ballots Due Friday, October 23rd!
  • Wilmarth: "Dugan Is Wrong About Blame for Crisis"
  • Government Criticized for Financial Crisis
  • Obama to Offer Capital to Community Banks But with Conditions
  • Updates on Financial Reform Debate
  • Dodd Proposes Regulations on Overdraft Services
  • Home Prices Forecast to Continue Declining
  • Baker Market Update
  • Illinois Foreclosure Activity Rises More Than U.S. in 3rd Quarter
  • Dugan Says National Banks Can Withstand Declining Asset Quality
  • ICBA Urges Congress to Support Small-Business Lending
  • FinCEN Announces Expanded Outreach to Smaller Institutions
  • Governor Quinn Announces Funding for Low-Income Weatherization
  • Ten Ways to Prepare for Your Next Bank Examination
  • Corporate Governance: How To Act in a Post Bailout Era
  • Recovery Solutions Wins 2009 BankNews Innovative Solutions Award
  • Wolters Kluwer Launchs New ExpertHeadquarters Website
  • Agricultural News
  • Alert: Criminals Paying Top Dollar for Banking Credentials
  • Community Bankers for Compliance Program Now Accepting Registrants
  • CBAI Women in Community Banking Conference Next Month
  • CBAI’s Branch Managers Session Set for December


  • FHLB of Chicago Director Election - Ballots Due Friday, October 23rd!

    The voting deadline for the Federal Home Loan Bank of Chicago's 2009 director election is this Friday, October 23rd. CBAI encourages all members that are eligible to vote to participate in this important election. Please take action before time runs out! Your votes are important! The ballots must be RECEIVED at the FHLB of Chicago by October 23rd!
    More.

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    Wilmarth: "Dugan Is Wrong About Blame for Crisis"

    In his speech before Women in Housing and Finance on September 24, Comptroller of the Currency John Dugan repeated three arguments that have frequently been advanced in recent months by representatives of big financial institutions. Art Wilmarth, a highly-respected professor of banking law at George Washington University in Washington, D.C., refuted those assertions in compelling fashion. For his response,
    click here.

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    Government Criticized for Financial Crisis

    In a recent MSNBC segment titled, "Don't Blame the Banks," the close ties between Wall Street and Washington are criticized for causing the crisis and slowing reforms. Click on video below.

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    Obama to Offer Capital to Community Banks But with Conditions

    President Obama is scheduled to
    announce today (October 21) another opportunity for community banks to access TARP funds if banks can make the case that the money will be used for small business lending. As before, banks will also need to show they can survive without the additional funds. The program will also increase the caps for loans backed by the Small Business Administration. An estimated $320 billion is available in the TARP fund.

    CBAI believes that, while the plan has merit, it does not go far enough. Treasury has allowed troubled big banks to use TARP funds to bolster their capital without any conditions on lending. Many community banks today are struggling to rebuild their capital and should have comparable access to TARP funds for that same purpose.

    FDIC Chairman Sheila Bair testified in Congress last week that she is discussing with Treasury officials using TARP for community banks. On Monday, October 19, Bair said the big bank bailout last year has made the too-big-to-fail problem even worse as asset concentration has increased.

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    Updates on Financial Reform Debate

    With the House Financial Services Committee now addressing financial reform proposals, CBAI and ICBA will be calling on community bankers as needed to help shape the outcome on these critical issues. A recent victory for community banks came last week when banks under $10 billion in assets were exempted from the proposed CFPA. ICBA and CBAI also successful lobbied to to reject an amendment to exempt all credit unions from the CFPA. Other amendments to exempt auto dealers and credit unions were offered yesterday, and CBAI and ICBA worked to reject those proposals as well. For a recap of key events last week,
    click here.

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    Dodd Proposes Regulations on Overdraft Services

    Senate Banking Committee Chairman Christopher Dodd (D-Conn.) introduced legislation on October 19 to restrict overdraft fees banks are permitted to charge. He stated that consumers need to be protected from excessive fees. Under the measure, customers would have to opt in to receive overdraft services, the number of overdraft fees would be limited to one per month and six per year, and fees would have to be proportional to the cost of processing an overdraft. For more details,
    click here.

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    Home Prices Forecast to Continue Declining

    According to Fiserv, the foreclosure crisis will continue into 2011 as home prices are predicted to drop in 342 of 381 markets during the next year. Florida, Arizona, and Nevada are expected to suffer the steepest declines. However, Chicago prices, which have fallen 25.2%, are expected to drop only 4.1% over the next 12 months and then start to climb.
    More information.

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    Baker Market Update

    With third-quarter earnings season in full swing, company earnings reports have been mixed so far this week as the market searches for stability. Citigroup and Goldman Sachs shares fell after heir earnings release, disappointing some investors even as Goldman beat median estimates.
    Click here for more details.

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    Illinois Foreclosure Activity Rises More Than U.S. in 3rd Quarter

    According to a recent Associate Press
    release, foreclosure activity rose more in Illinois in the third quarter than in the country as a whole. The increase was five percent nationwide in foreclosure filings, which include default notices and several other legal notices that homeowners and other property owners receive before they finally lose their properties.

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    Dugan Says National Banks Can Withstand Declining Asset Quality

    Comptroller of the Currency John C. Dugan
    told a Senate subcommittee on October 14 that while credit quality is continuing to worsen, the vast majority of national banks are strong and have the financial capacity to withstand declining asset quality.

    “Net capital levels in the national banking system have increased by more than $186 billion over the last two years, and net increases to loan-loss reserves have exceeded $92 billion,” Dugan said in testimony before the Senate Banking Subcommittee on Financial Institutions. “While these increases have considerably strengthened national banks, we anticipate additional capital and reserves will be needed to absorb additional potential losses in banks’ portfolios.”

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    ICBA Urges Congress to Support Small-Business Lending

    In testimony before the House Small Business Committee, ICBA Chairman Mike Menzies detailed a number of ICBA legislative recommendations to enhance and expand small-business loans and SBA lending, while urging lawmakers to exercise caution with regulatory reform proposals to avoid undue burdens on the nation’s community banks.

    “Even with tremendous fiscal and monetary stimulus and SBA incentives, efforts by community banks to expand lending will be hamstrung if regulatory burdens are dramatically increased,” Menzies said. “Lawmakers must be cautious so that the missteps of a few large financial players do not foster costly new regulatory burdens on all financial institutions.”

    Citing recent FDIC data, Menzies said that community banks with $1 billion in asset size or less were the only segment to show an increase in their net loans and leases. He also called on Congress to implement a series of reforms to support small business lending and thanked the committee for proposing a robust SBA authorization level.
    Read ICBA Release. Read ICBA Testimony.

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    FinCEN Announces Expanded Outreach to Smaller Institutions

    The Financial Crimes Enforcement Network (FinCEN) last week
    announced a new outreach program to financial institutions with assets under $5 billion to learn how they are implementing anti-money laundering programs, and where additional guidance could be helpful.

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    Governor Quinn Announces Funding for Low-Income Weatherization

    Late last week Governor Quinn
    announced that about $242 million in additional funding is now available for low-income families to improve the energy efficiency of their homes. The funds were made available through the American Recovery and Reinvestment Act (ARRA).

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    Ten Ways to Prepare for Your Next Bank Examination

    In these troubled times, Vedder Price, a Chicago-based law firm, is spending more time advising its clients on regulatory matters. From these ongoing conversations with its clients and the bank regulators, the firm developed the following
    suggestions about how to prepare for your next bank examination.

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    Corporate Governance: How To Act in a Post Bailout Era

    Corporate governance refers to the manner in which a company is directed by its board of directors. With the collapse of such companies as Enron, WorldCom, and others, there has been greater scrutiny of corporate governance and the manner in which boards of directors make decisions affecting their companies. Sarbanes-Oxley was passed in 2002 with the goal of restoring the public's confidence in the corporate governance of public companies. As a result, there are many corporate governance requirements for public companies that serve as best practices for private companies, including banks.
    Click here for a complete article authored by Catherine Ghiglieri, president of Ghiglieri & Company, Austin, TX.

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    Recovery Solutions Wins 2009 BankNews Innovative Solutions Award

    Recovery Solutions of Plainfield, Illinois, recently won the 2009 BankNews Innovative Solutions Award for Best Architectural/Equipment Solution.
    More.

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    Wolters Kluwer Launchs New ExpertHeadquarters Website

    Offering a
    packed calendar of information-rich webinars, podcasts, and more, Expert Headquarters will help keep bankers up to date and in compliance.
  • Get the needed information from a trusted partner and resource

  • Timely and comprehensive updates minimize chaos and stress

  • Understand the impact on officers, employees, and the bank

  • All without having to leave the office


  • Sign up for FREE email alerts and enter a contest to win a free iPod®!

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    Agricultural News

    Crop Progress Report Neutral to Bullish
    The latest USDA Crop Progress
    report revealed continuing slow progress in harvesting soybeans and corn due to wet weather. Illinois was the largest laggard with only 13% of the soybean crop and 11% of the corn crop harvested.

    Economy Hurting Illinois Pork Industry
    Pork producers have lost money for much of the past two years, and profitability is not expected to return for at least another six months, according to agricultural experts. As a result, many hog farmers have exited the industry. More information.

    Illinois Awarded Specialty Crop Grants
    The USDA has awarded Illinois more than $435,000 to promote additional local specialty food production. The funds are part of the Specialty Crop Block Grant Program in the Farm Bill. The Illinois Department of Agriculture announced 28 projects that will receive funding. For a list of the grant recipients and more information, click here.

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    Alert: Criminals Paying Top Dollar for Banking Credentials

    CBAI Associate Member SecureWorks®, a global provider of security services protecting 2,600 clients worldwide, released a new Threat Analysis report that uncovers a flourishing illegal business in the
    underground community using the Pay-Per-Install model. The Pay-Per-Install business model has existed for years and was first used to distribute advertisements online. The report details how cyber criminals are recruiting hundreds of affiliates to join their Pay-Per-Install (PPI) Affiliate Programs and install malware – malicious software – and spyware onto innocent victims' computers. As a result of the PPI programs, cyber criminals are gaining access to millions of compromised computers that are infected with malware cocktails containing everything from credential-stealing software to spam software, and others.

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    Community Bankers for Compliance Program Now Accepting Registrants

    Community banks are faced with a bewildering array of ever-changing regulations. While all banks strive to be in compliance, the
    regulatory requirements can be overwhelming. Most community banks do not have the time or money to build elaborate compliance systems. In response, CBAI has teamed up with Young & Associates of Kent, Ohio to offer “The Community Bankers for Compliance” (CBC) program. Now beginning its 21st year, this program provides a cost-effective approach to obtaining up-to-date information concerning bank regulations and practical techniques for maintaining an effective compliance program. So don’t delay! Enroll today!

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    CBAI Women in Community Banking Conference Next Month

    CBAI offers its third annual
    “Women in Community Banking Conference” November 17 – 18 at the Hilton Hotel in Springfield. The conference begins with an evening social on Tuesday, November 17, and a full-day conference is scheduled for Wednesday, November 18. Topics include, “I Know I’m Supposed To Be Wonder Woman, But I Don’t Have Any Bullet-Blocking Bracelets” and “Your Best Self – Freshly Brewed” with Brenda Clark Hamilton, founder of Fresh Coffee Professional Growth Programs, Algona, IA; “Women’s History in Business and Banking” with Bobbette Fagel, vice president of infotex, Inc., Kokomo, IN; “Guiding Today’s Bankers: The Role of Women Bankers as Mentors,” with Dianne Barton, president of Performance Solutions, Inc., Kennesaw, GA; “Can Social Networking Benefit Your Bank,” with Bridget Huffman, BKD, LLP, St. Louis, MO; and community banking issues with Illinois State Treasurer Alexi Giannoulias or his chief of staff, Robin Kelly.

    Don't miss this opportunity for invaluable networking and powerful information, making attendance at this symposium a great career move.

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    CBAI’s Branch Managers Session Set for December

    Want to improve leadership skills; remember names, faces, and lists; improve telephone etiquette; polish public speaking skills; and kick start customer service efforts? Then, plan to attend CBAI’s
    “Branch Managers’/Supervisors’ Skills” in Springfield this December. Topics include overcoming complacency, physical security issues, consumer and commercial lending, as well as marketing business and learning how to make customers WANT to do business with the bank. Leading this seminar is Charles Williams, president of Marketing Advertising Consulting Service, Inc. (MACS!) in Chauncey, GA. Williams is a former banker, a successful businessman, an author, and an outstanding presenter. He has more than 15 years’ experience in the field of bank-security training, more than 10 of which were spent as a bank-security officer.

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