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           December 16, 2009 Graphic
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Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois


  • U.S. House of Representatives Approves Financial Reform Bill
  • Straight Talk on Community Bank Positions on HR 4173
  • Obama Chastises Wall Street Bankers
  • "The End of Too Big To Fail"
  • Reinstatement of Glass-Steagall Gains Momentum
  • Volcker Makes International Plea to Break Up Giant Banks
  • Michigan Senator Asks Geithner to Address Harsh Exams
  • FDIC Releases 3rd Quarter State Profiles and Approves 2010 Budget
  • Baker Market Update
  • Economic Conditions Expected to Improve
  • Illinois Foreclosure Activity Down in November
  • CBAI Receives 2009 Best of Business Award
  • Controversial Data Security Bill Passes House
  • Get Year-End Tax Deduction by Donating to CBAI Foundation
  • 2010 Goal: Originate High Quality Earning Assets
  • Are You Prepared for These 2010 Regulatory Changes?
  • REMINDER ABOUT EMERGENCY BANK OFFICE CLOSINGS
  • New Deposit Rate Caps Become Effective January 1, 2010
  • CBAI Compliance Institute Scheduled for January 13-14
  • CBAI To Offer Seven 2010 CEO Forums Beginning in January
  • 2010 CBAI Senior Lender Forums Begin February 2


  • U.S. House of Representatives Approves Financial Reform Bill

    Last Friday the House voted 223-202 to pass landmark regulatory-reform legislation. CBAI and ICBA worked to defeat hostile amendments and supported the final version of the bill as a net win for community banks.
    Click here to read article on HR 4173.

    President Obama applauded passage of the measure as an important step. See White House Release. Treasury Secretary Tim Geitner also commended the House for adopting HR 4173. See Treasury Statement.

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    Straight Talk on Community Bank Positions on HR 4173

    ICBA President Camden Fine stated, “It is time for some straight talk on HR 4173 because there has been a great deal of misinformation and misrepresentation in the past couple of days.”
    More.

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    Obama Chastises Wall Street Bankers

    President Obama, in a “60 Minutes”
    interview on Sunday, December 13, criticized large Wall Street banks for failing to get the message that receiving millions in bonuses after they have been bailed out during an economic crisis is wrong. He assigned blame on Wall Street for causing the crisis and costing millions of Americans their jobs.

    On Monday, the President met with several Wall Street executives to urge them to make more loans to stimulate the economy. He also chided them for lobbying “vigorously against the financial reform measure" that passed the House on December 11. See Article. See White House Statement.

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    "The End of Too Big To Fail"

    Pennsylvania Congressman Paul Kanjorski recently offered his reasons for sponsoring legislation to rein in and dismantle too-big-to-fail financial firms, a position advocated by ICBA and CBAI.
    See Full Article.

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    Reinstatement of Glass-Steagall Gains Momentum

    U.S. Senators Maria Cantwell (D-WA0 and John McCain (R-AZ) are expected to introduce today a bill to reinstate the Glass-Steagall Banking Act of 1933, which separated commercial and investment banking. The House is considering similar legislation. ICBA and CBAI strongly opposed legislation to repeal Glass-Steagall when Congress passed the Gramm-Leach-Bliley Act of 1999. The measure authorized the common ownership of banks, insurance companies, and securities firms. ICBA and CBAI applaud introduction of this important legislation to separate commercial banks and investment firms.

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    Volcker Makes International Plea to Break Up Giant Banks

    For the past two months, former Federal Reserve Chairman Paul Volcker has traveled globally to warn that bankers and regulators “have not come anywhere close to responding with necessary vigor” to the worst economic crisis since the Great Depression. Volcker has advocated breaking up the giant banks to avert another economic disaster, but no law-making body is actively pursuing an outright break-up of giant banks that are sheltered by access to an implicit safety net. CBAI will continue to urge Congress to enact legislation to break up the too-big-to-fail banks for the sake of future generations and the nation’s financial and economic stability.
    See Article.

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    Michigan Senator Asks Geithner to Address Harsh Exams

    U.S. Senator Carl Levin (D-MI) this week called on Treasury Secretary Tim Geithner to address overly aggressive community bank examinations. He is among a growing number of lawmakers demanding that regulators reduce the severity of their exams and give community banks more opportunity to resolve their problems. Levin also urged Geithner to improve community bank access to TARP funds to boost small-business lending. CBAI has urged lawmakers and the Treasury to make TARP funds available to community banks on reasonable terms to help bolster their capital positions similar to what was done for the giant troubled banks more than a year ago.
    See Levin Letter.

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    FDIC Releases 3rd Quarter State Profiles and Approves 2010 Budget

    The
    FDIC State Profiles for the third quarter of 2009 are now available. The Profile contains financial data for all banks and thrifts in each state. In addition, the FDIC today announced approval of a $4.0 billion operating budget for 2010, an increase of more than $1.4 billion from 2009 due to the cyclical nature of bank failures. The FDIC staffing level for 2010 was also increased to 8,653 employees, up from 7,010 in 2009.

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    Baker Market Update

    Long-term Treasury yields pushed higher. Retail sales in November rose more than forecast. The Treasury auctioned off $21 billion and $13 billion in 10-Yr notes and 30-Yr bonds respectively. Gold prices may have peaked.
    More.

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    Economic Conditions Expected to Improve

    Participants in the Federal Reserve Bank of Chicago’s 23rd annual Economic Outlook Symposium on December 4, 2009, concluded that the nation’s economic growth is expected to increase at a solid pace next year.
    See Release.

    Meanwhile, the Rural Mainstreet Index for November, 2009, continued to climb for the third straight month. However, the 38.4 rating reflects continued economic weakness. The Index is based on a survey of community bank executives in an 11-state region including Illinois.

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    Illinois Foreclosure Activity Down in November

    According to a
    news release from the Associate Press, the number of Illinois homeowners on the brink of foreclosure fell in November compared with the previous month but was still more than double the figure from a year ago.

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    CBAI Receives 2009 Best of Business Award

    CBAI has received the 2009 Best of Business Award in the trade associations category by the Small Business Commerce Association (SBCA). The Program recognizes the top 5% of small businesses throughout the nation. Using consumer feedback, the SBCA identifies organizations that exemplify what males small businesses a vital part of the economy.
    More information.

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    Controversial Data Security Bill Passes House

    The House passed the Data Accountability and Trust Act (H.R. 2221), which was opposed by much of the financial services industry. In a letter, ICBA and others expressed concerns that the bill would lead to uneven protection for consumers and unnecessary and overlapping requirements for the financial services industry.

    H.R. 2221 would establish a new set of rules for dealing with data security, and it would apply them to a broad range of businesses, including financial institutions that are already subject to data-security requirements of the Gramm-Leach-Bliley Act and other federal and state laws.
    Read Joint Letter.

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    Get Year-End Tax Deduction by Donating to CBAI Foundation

    By donating to the Foundation you support an annual scholarship program that provides college financial aid to deserving-high-school seniors in the name of Illinois community banking. Also, a $1,000 minimum pledge/donation makes your bank eligible for The William C. Harris and the SHAZAM® Scholarships for the progeny of community-bank officers and their directors and employees.

    You can donate corporately and personally and fully deduct your donations in 2009. Just make sure to date your donations in 2009. Donations should be made payable to:
    The CBAI Foundation for Community Banking
    901 Community Drive
    Springfield, IL 62703

    For further information, please call Andrea Cusick at 800/736-2224.

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    2010 Goal: Originate High Quality Earning Assets

    As community banks plan their budgets and develop strategies for 2010, there continues to be uncertainty in every corner. Without question, the biggest concern is the origination of quality assets that will provide the needed earnings for the bank and survive the scrutiny of the regulators. Triad Financial Services, a 50-year-old award winning financial services company, can provide the answer.
    More.

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    Are You Prepared for These 2010 Regulatory Changes?

    Changes to REG GG, RESPA, and REG CC will impact banks beginning January 1, 2010. Visit the regulations below to get background information and related compliance products and services available from Wolters Kluwer Financial Services.

    Contact your WKFS Account Executive or Brenda Herubin Brenda.herubin@wolterskluwer.com, for more information.

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    REMINDER ABOUT EMERGENCY BANK OFFICE CLOSINGS

    With winter officially here, it’s time to be prepared in the event that a harsh winter storm causes closure of banking offices due to snow, icy conditions, loss of power, etc. A bank officer should contact the Illinois Department of Financial & Professional Regulation’s Division of Banking or, for national banks, the OCC to promptly advise the regulatory agency of the decision to close the affected office(s). Contacting the regulator and obtaining an emergency declaration acknowledging the emergency closure of a banking office can protect the bank from potential liability for actions not taken because of the interruption of the bank’s normal business day.

    In addition to contacting the regulator and obtaining the appropriate declaration of an emergency, the bank should post a notice on the main entrance doors of the affected office. The notice should advise the public of the temporary closing of that banking office and the legal authorization for the emergency closing (i.e., the declaration of emergency obtained from the Illinois Division of Banking or from the OCC). If a power outage or hazardous road conditions affect one banking office but not others, the public notice posted on the doors of the affected office(s) could also include information directing customers to another bank office that remains open or to a phone number or web site at which the customer can conduct business or obtain additional information.

    For more information about Illinois’ Banking Emergencies Act or corresponding OCC information, please feel free to contact CBAI General Counsel Jerry Cavanaugh by phone (1-800-736-2224 from within Illinois) or by e-mail (mailto:
    jerryc@cbai.com).

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    New Deposit Rate Caps Become Effective January 1, 2010

    Beginning January 1 institutions that are less than well-capitalized must comply with new restrictions on deposit rates. They will not be allowed to pay more than 75 basis points over a national average calculated by the FDIC. Although the final rule is not effective until January 1, 2010, the FDIC does not object to the immediate use of the newly-defined national rate by an insured depository institution. The national rates and rate caps for various deposit maturities and sizes are provided
    here.

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    CBAI Compliance Institute Scheduled for January 13-14

    As the
    Community Bankers for Compliance Program has evolved, CBAI has identified a need for a basic, introductory class for those compliance officers who are either new to banking or new to their positions. To meet this need, we have created a comprehensive compliance program divided into two sessions (Session 1: Operations/Deposit Compliance – January 13-14, and Session 2: Lending Compliance – April 6-8). Each session is designed to provide a comprehensive understanding of the major regulatory compliance regulations that have been determined to be “must knows” for compliance officers. This institute is conducted by Bill Elliott, senior consultant and manager of compliance, and Bryan K. Bradley, CRCM, senior consultant, both of Young & Associates, Inc. of Kent, OH, a nationally recognized compliance consulting firm specializing in community banks.

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    CBAI To Offer Seven 2010 CEO Forums Beginning in January

    CBAI is pleased to offer the
    CEO Forums, which provide opportunities for CEOs to discuss important issues with non-competing community bankers. Based on bank size and market, CBAI organizes the Forums to ensure participants have as much in common as possible without being competitors. Forums meet quarterly to discuss timely issues. Participation in the Forums comes with a long list of benefits. Participants discuss current challenges with peers, learn about profitable products and services from other community bankers, and form lasting relationships with non competing CEOs. The Forums also provide the opportunity to increase profits through higher performance, discover cost-cutting concepts, solve pressing problems, and obtain access to highly respected, banking-related experts.

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    2010 CBAI Senior Lender Forums Begin February 2

    CBAI will offer the
    2010 Senior Lender Forums which provide an opportunity for community bank lenders to discuss important issues with non-competing community bankers. They are designed to be a rewarding experience where participants can grow both personally and professionally. CBAI has four Senior Lender Forums and is looking for a few senior lenders to complete the Forums. Benefits of the Forums include improving the profitability and reducing the risk of bank’s loan portfolio, increasing your understanding of regulatory issues, solving your most pressing problems, obtaining access to highly-respected experts in the field, and forming lasting relationships with non-competing senior lenders. Paul Sims, president of Guided Solutions, Franklin, TN, facilitates the Senior Lender Forums.

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