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Community Bankers Association of Illinois
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     A Bi-Weekly News Bulletin for CBAI Members                   December 26, 2012 Graphic
Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois

  • FDIC Releases Comprehensive Study of Community Banks
  • CBAI Announces 2013 Group Meeting Schedule
  • Senators Want GAO to Study Perks of Too-Big-To-Fail
  • CBAI-Supported Privacy Notice Bill Passes the U.S. House
  • TAG Suffers Setback in the U.S. Senate
  • CFPB Director Richard Cordray Meets with CBAI Bankers
  • ICBA Leadership Articles
  • Regulators Release Annual CRA Asset-Size Threshold Adjustments
  • Prediction: Mobile Banking to Grow 300% in Four Years
  • Update on Treasury’s State Small Business Credit Initiative (SSBCI)
  • Baker Market Update
  • Is Your Organization's Compensation Package Competitive?
  • Risks and Benefits of Cloud Computing
  • Intense Regulatory Focus on Consumer Protection Poses Strategic Challenges
  • Compliance Institute (Operations/Deposit) Scheduled for January 8-9, 2013
  • Commercial Lending Institute to be Held January 14-16, 2013
  • Community Bank Directors’ College Set for January 23 & 24, 2013

  • FDIC Releases Comprehensive Study of Community Banks

    Last week the FDIC released the results of its yearlong Community Banking Initiative (CBI) which was established to understand the evolution of community banks during the past 25 years and identify challenges and opportunities.
    See FDIC Release.

    The CBI results confirm the vital role of community banks in economic development, especially in rural and micropolitan communities. FDIC Chairman Martin Gruenberg said, “The bottom-line finding is that even with all of the consolidation that’s taken place and the market challenges that exist for community banks, the core community bank model of reliance on relationship banking funded by core deposits remains quite viable.” See ICBA Release. See FDIC Executive Summary.

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    CBAI Announces 2013 Group Meeting Schedule

    CBAI leaders and executive staff are visiting 11 locations on the
    2013 Group Meeting tour this spring. Bankers from nearly 200 banks participate in these enjoyable and informative events each year. Consisting of an optional golf outing and a dinner meeting, Group Meetings also provide an excellent opportunity to get the latest information on key banking issues and catch up with friends and peers. Make plans now to attend!

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    Senators Want GAO to Study Perks of Too-Big-To-Fail

    Senators Sherrod Brown (D-Ohio) and David Vitter (R-Louisiana) plan to push legislation to require the Government Accountability Office (GAO) to study whether giant financial institutions enjoy economic and competitive benefits from their “too-big-to-fail” status. Both CBAI and ICBA support the measure as an important step in obtaining needed data on the effects of government support for mega banks.
    See ICBA Release. See The Hill Article.

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    CBAI-Supported Privacy Notice Bill Passes the U.S. House

    The U.S. House approved CBAI supported legislation (H.R. 5817) that would eliminate the provision in the Gramm-Leach-Bliley Act requiring financial institutions to provide annual privacy notices when their disclosure practices have not changed. The Eliminate Privacy Notice Confusion Act was approved by the House on a voice vote.

    This legislative initiative was included in ICBA’s Communities First Act and would remove an unproductive and burdensome annual expense for community banks.

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    TAG Suffers Setback in the U.S. Senate

    Legislation to extend the Transaction Account Guarantee (TAG) program (S. 3637) suffered a significant setback in the U.S. Senate when it failed to clear a procedural hurdle. It is particularly disappointing that the Senate legislation failed on a procedural motion versus its merits. ICBA and CBAI will continue to work with Congress to pass a TAG extension before the program expires on December 31, 2012.

    CBAI thanks community bankers from across the state for e-mailing and calling Senator Durbin’s office to express support for a TAG extension. Although the legislation failed to move forward, CBAI is gratified that Senator Durbin voted “YES” on the procedural votes to move this legislation forward.

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    CFPB Director Richard Cordray Meets with CBAI Bankers

    Richard Cordray, Director of the Consumer Financial Protection Bureau (CFPB), participated in a roundtable discussion with CBAI bankers at The Westin O’Hare near Chicago on December 5, 2012. This meeting was a continuation of the productive dialogue between the Bureau and CBAI bankers that began at a roundtable with Professor Elizabeth Warren in February of 2011. The goal was to share member observations and recommendations with the Bureau concerning consumer regulations and the impact those regulations have on community banks and their communities.
    Read Article.

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    ICBA Leadership Articles

    "Ready to Rumble" - Camden R. Fine, ICBA President
    As the new 113th Congress gets underway this month, ICBA, predictably, has another full and varied agenda it’s pursuing for the nation’s community banks. But that agenda can’t include the unforeseeable events that inevitably happen. That’s how our industry’s emergency over the Basel III capital standards erupted early last summer.
    Read Fine Points.

    "Working Forward" - Jeff Gerhart, ICBA Chairman
    Resolutions are a yearly ritual with many people. They help us figure out what we can do to improve our lives. The usual suspects for resolutions involve learning something new, reading more, traveling and, ah yes, shedding a few pounds. At ICBA, we also continually look ahead with resolve to find ways to improve. Last year ICBA’s board of directors passed a measure making changes to the association’s community-governance structure. The resolution was put forth to create a better and stronger banker-led governance structure — one that will help move ICBA and community banking forward in the months and years ahead. Read Article.

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    Regulators Release Annual CRA Asset-Size Threshold Adjustments

    Federal regulators recently announced the annual adjustment to the asset-size thresholds used to define small and intermediate banks and thrifts under Community Reinvestment Act regulations.
    See CRA Threshold Adjustments.

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    Prediction: Mobile Banking to Grow 300% in Four Years

    According to the Aite Group, the number of U.S. consumers using a mobile device to access their banking accounts will increase from 33 million to 96 million by 2016. Smartphone users will account for 96% of the total mobile banking population.
    See AB Article.

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    Update on Treasury’s State Small Business Credit Initiative (SSBCI)

    According to Clifton Kellogg, Director of the State Small Business Credit Initiative, U.S. Department of the Treasury, community banks play a vital role in sustaining their local economies. For communities to thrive, small businesses must be able to obtain credit. As the program director of the SSBCI and as a former community bank CEO, Kellogg understands the challenges of providing credit to borrowers. Community banks face difficulty extending loans that both meet their standards and are acceptable to the examiners. Likewise, credit-worthy small businesses continue to face difficulties finding the credit they need to expand and grow. That is why the United States Treasury Department administers the SSBCI, which provides direct funding to states for programs that expand access to credit for small businesses.

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    Baker Market Update

    Whew! That was a close one! The bond market, along with the rest of us, is greatly relieved that we apparently dodged a Mayan bullet. Bullet, spear, arrow whatever it was, we dodged it. It remains unclear as to whether or not the Mayans had a “Plan B”. Unfortunately, the same cannot be said about the dodgy business of federal budget legislation.
    Read More.

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    Is Your Organization's Compensation Package Competitive?

    A competitive compensation package remains a key factor in attracting and keeping a talented staff. The 2012 CBAI Officer Compensation Survey results provide detailed compensation and benefits for officers, plus information on director and support-personnel compensation.

    The Survey reflects information based on asset size and three geographical break-downs. Gain a competitive advantage by ordering the 2012 CBAI Officer Compensation Survey. Contact the CBAI Department of Communications at 800/736-2224 or

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    Risks and Benefits of Cloud Computing

    Patti Tobin of Community BancInsurance Services, Powered by Nicoud
    Ask 1,000 Americans what they think “cloud computing” is, and you’ll get 1,000 different answers. Confusion not only exists about what it is but also how it is used. Some believe it’s about the weather, or toilet paper; few correctly identify it as online computer networks. Any Internet user who buys from large online retailers or who uses social networking sites uses the cloud.
    Read Article.

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    Intense Regulatory Focus on Consumer Protection Poses Strategic Challenges

    Heightened regulatory zeal over consumer protection in financial services requires senior executives in banking, insurance and investment management to re-evaluate their core strategies, says a new report from KPMG International,
    New Light on Old Truths: Consumer protection and good business sense.

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    Compliance Institute (Operations/Deposit) Scheduled for January 8-9, 2013

    Community banks are constantly faced with a bewildering array of ever-changing regulations. In response to this training need, CBAI presents the
    Compliance Institute" this January & April. An introductory course for those compliance officers who are either new to banking or new to their positions, this institute is designed to provide a comprehensive understanding of the major regulatory compliance regulations that have been determined to be "must knows" for all compliance officers. The school has been divided into two sessions, Operations/Deposit Compliance and Lending Compliance. Attendees can attend one or both sessions, dependent upon need. Offered in January, session I, Operations/Deposit Compliance, addresses topics including compliance management, Bank Secrecy Act, Truth in Savings Act, Regulation CC, and the Electronic Funds Transfer Act. Topics covered in Lending Compliance, offered in April, include Regulation Z, Community Reinvestment Act, Home Mortgage Disclosure Act, Fair Credit Reporting Act, and BSA. Bill Elliott, senior consultant and manager of compliance, and Adam Witmer, CRCM, consultant, both of Young & Associates, Inc., Kent, OH, lead this institute.

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    Commercial Lending Institute to be Held for January 14-16, 2013

    The three-day
    Commercial Lending Institute provides commercial lenders with a solid foundation for producing and managing a quality loan portfolio. It focuses on analytical tools such as ratio, financial, cash flow analysis, as well as commercial loan structuring to enhance repayment capacity. Case studies are used to reinforce learning and represent typical community bank borrowers. Topics covered on day one include financial statement review, credit and ratio analysis, asset-conversion cycle analysis, and ratio interpretation. Cash budgeting, loan structuring, commercial loan documentation, and credit risk management are among the topics on day two. Day three examines cash-flow analysis, financial forecasting, and writing credit memos. Jeffery Johnson, president and founder of Bankers Insight Group, Atlanta, GA, heads this distinguished faculty. He is joined by Gerald Pfeiffer, partner, and Andrea Zurkamer, senior manager of assurance services, both of CliftonLarsonAllen, LLP in Peoria, IL; and Robert M. Swartz, manager, and Gary Genenbacher, CPA and partner, both of BKD, LLP.

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    Community Bank Directors’ College Set for January 23 & 24, 2013

    Community Bank Directors’ College was developed in conjunction with state and federal regulators, and is designed to teach individuals how to become more effective, capable, and supportive members of their bank’s board of directors. The goal is to graduate directors who return to their banks more active, more knowledgeable, and more decisive -- an even bigger asset to your community bank. The College is offered once a year, provides a thorough understanding of bank operations and bank directors’ responsibilities, and is recommended for both new and seasoned bank directors. It is structured as two, two-day sessions offered on a annual basis; either may be attended as a stand-alone course. The first session is being held at Northfield Inn and Conference Center in Springfield, IL, January 23-24, 2013. Topics covered in the first session include an overview of the role of the bank director, the changing landscape of banking, the director and the board, and the loan process from the director’s view. The internal audit function, directors’ responsibilities in compliance, strategic technology planning and security update, your regulators' view of directors' responsibilities, and regulatory hot topics are also addressed.

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    CBC Program







    Finer Points Blog

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