Connected To Community Banking!
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                            June 11, 2014

Community Bankers Association of Illinois
Community Bankers Association of Illinois Community Bankers Association of Illinois
  • Bipartisan and Bicameral Support for the CLEAR Act Grows!
  • CBAI and ICBA Welcome Agency Effort to Address Regulatory Burdens
  • Illinois Senators Kirk and Durbin Support Redundant Privacy Notice Relief
  • Panel Looks at Future of Community Banking
  • Five Reasons to Choose a Community Bank
  • How Your Bank Can Avoid Death by Godzilla
  • Then. Now. Old Questions Revisited.
  • Baker Market Update
  • Chicago Fed President Says Asset Purchases Will End
  • USDA Updates Forecasts for U.S. Agricultural Exports
  • Farmland Markets – Comparing the 1980s and the Present
  • Continuity Control: When It Comes to Bank Performance, Size Doesn’t Matter
  • CEOs Are Being Held Accountable for Information Security
  • Fiduciary Liability and Your Community Bank
  • Migration Analysis: The Way Forward [CPE Webinar]
  • Shazam Collaborates on Seamless Digital Banking Services
  • 2014 Financial Email Marketing Benchmark Report
  • News from the Bench: Beware of Mortgage Loans from Unlicensed Originators
  • Tips To Thwart the “Sweetheart Scam”
  • Human Resources Update Scheduled for June 17
  • Trust Administration & Sound Regulatory Practice Scheduled for June 18
  • Lending to Municipalities Scheduled for June 23 & 24
  • Advanced Compliance Institute To Be Held June 24 & 25
  • Ag Lenders’ Conference Scheduled for June 26
  • Register for CBAI’s 40th Annual Convention & Expo by June 30 for Early-Bird Pricing

  • Bipartisan and Bicameral Support for the CLEAR Act Grows!

    Bipartisan and bicameral support is growing for the Community Lending Enhancement and Regulatory Relief Act (CLEAR 61114 Relief Act of 2013, H.R. 1750/S. 1349) with Congressman Adam Kinzinger (R-16th) recently cosponsoring this important legislation. Currently the CLEAR Act has 33 cosponsors in the Senate and 163 cosponsors in the House.

    Community banks face a regulatory burden that is completely out of proportion to their size, business model, and risks they pose to the financial system. Regulations disproportionally burden community banks because they cannot spread these costs over a large number of customers. Targeted and sensible regulatory relief will allow community banks to better serve their customers and communities.
    Read More.

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    CBAI and ICBA Welcome Agency Effort to Address Regulatory Burdens

    CBAI and ICBA welcomed federal regulators’ announcement that they will work to address excessive and unneeded regulatory burdens under the Economic Growth and Regulatory Paperwork Reduction Act of 1996.

    ICBA said that the regulators’ request for comment itself, which lists 124 different rules and regulations that the agencies will explore, illustrates the regulatory overkill community banks face on a daily basis. The association noted that since 2007, regulators have churned out 9,800 Federal Register pages of new bank regulations.

    Noting that banking regulators’ hands are frequently tied by statutory requirements, ICBA also continued its call for Congress to act on regulatory relief legislation, such as the numerous pending bills inspired by ICBA’s Plan for Prosperity platform.

    The agencies published the first of a series of requests for comments to identify outdated, unnecessary or unduly burdensome regulations imposed on insured depository institutions. The EGRPRA requires the agencies to review regulations issued by the agencies at least every 10 years.

    The agencies divided regulations into 12 categories and will publish three additional Federal Register notices for public comment over the next two years. The first notice seeks comment on regulations from three categories: applications and reporting; powers and activities, and international operations.

    The public will have until September 2 to review and comment on this first set of categories. The agencies said they plan to schedule roundtable discussions with bankers and interested parties and will publish details about these sessions on the EGRPRA website as they are finalized.
    Read ICBA Statement. Read Notice from Regulators. Visit EGRPRA Website.

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    Illinois Senators Kirk and Durbin Support Redundant Privacy Notice Relief

    Illinois Senators Mark Kirk (R) and Richard Durbin (D) are cosponsors of redundant privacy notice relief legislation. The addition of Senator Durbin brings the number of bipartisan Senate cosponsors to 70.
    Read Article.

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    Panel Looks at Future of Community Banking

    Boston University and the OCC recently sponsored a series of panels on the future of banking. One panelist was ICBA’s Cam Fine who predicted that community banks will be vibrant for many years to come. He credited community banks with being tech savvy and appealing to Generation Y through their relationship banking model.
    See Moneynews Article.

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    Five Reasons to Choose a Community Bank

    A recent article in identifies five good reasons why people should choose to do business with community banks. While community bankers readily recognize these compelling reasons, consumers need to be reminded on a regular basis, especially when they are publicized by a third party.
    See Article.

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    "CBAI Connected to Community Banking" Is Sponsored
    by The SHAZAM Network

    Get the most out of your ATMs! The SHAZAM Network offers affordable, innovative, and competitive ATM solutions to help increase the profitability of your ATM program and give you valuable insight into your customers.

    How Your Bank Can Avoid Death by Godzilla

    Referring to the summer blockbuster movie Godzilla, consultant Mark Arnold identifies “Godzillas in the room” for many community banks and what steps that should be taken to avoid being trampled by them.
    Read More.

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    Then. Now. Old Questions Revisited.

    The financial services world is evolving and community banks have every chance to maintain or even grow relevancy in an ever confusing marketplace. Here are some of the questions community bankers might have asked in the past, versus the questions that should be addressed now.
    Read More.

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    Baker Market Update

    Remember when Tom Sawyer convinced his pals that he was actually doing them a favor by letting them whitewash the fence that Aunt Polly had ordered him to paint? Clever lad. In a similar move, the European Central Bank this week announced that instead of paying interest on funds placed with them, they would now be charging .1% on those deposits.
    See Baker Market Update.

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    Chicago Fed President Says Asset Purchases Will End

    Last week Federal Reserve Bank of Chicago President Charles Evans said the Fed will end asset purchase this year, and officials will wait until inflation is closer to its 2 percent objective before they consider raising interest rates.
    See Bloomberg Article.

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    USDA Updates Forecasts for U.S. Agricultural Exports

    The USDA recently released a report that projects 2014 agricultural exports will reach $149.5 billion, or $6.9 billion higher than previous estimates and, if attained, a new record for American agricultural exports. The projected increase is a function of not only rising prices but also increased demand for products overseas.
    See USDA Statement.

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    Farmland Markets – Comparing the 1980s and the Present

    Recent research conducted by the Department of Agricultural and Consumer Economics at the University of Illinois compared factors that contributed to the farmland crisis of the 1980s with the current farmland market to determine if any similarities exist. The report concluded that, compared to the 1980s, income expectations remain reasonable today, debt rates and interest rates are low which provide a buffer against potential asset reevaluations, and crop insurance has fundamentally altered the riskiness of income.
    See U of I Report.

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    Continuity Control: When It Comes to Bank Performance, Size Doesn’t Matter

    But banks must keep pace with technology

    Andy Greenawalt, CEO of Continuity Control, a provider of compliance management systems for community banks which CBAI recommends, believes that when it comes to banking performance, size doesn’t matter. He is quick to note, however, that community banks become vulnerable when they rely on old technologies and processes such as paper systems to manage compliance. He emphasizes that technology, outsourcing, and other tools can be leveraged to bring costs down and allow bankers to focus resources on their customers.

    More than 25 CBAI member institutions now utilize the compliance software solutions of Continuity Control.
    See AB Article.

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    CEOs Are Being Held Accountable for Information Security

    Bank CEOs and boards must now set the tone from the top in building a security culture. While it was once acceptable to delegate all things IT-related to lower-level personnel, bank regulators and boards now recognize that information technology and computer security need oversight from the top.
    See BankOnIT Article.

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    Fiduciary Liability and Your Community Bank

    Attracting and retaining the best talent to grow your community bank is absolutely vital in the ever-competitive lending landscape. Very few businesses in any sector are able to do so without offering some form of qualified defined contribution retirement plan. Those community banks that do offer a defined contribution plan—out of competitive necessity—carry increasing fiduciary risk. Even a casual glance at the volume of claims against plan sponsors proves an increasing rapaciousness in this area of employment law.
    See Community BancInsurance Service Powered by Nicoud Article.

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    Migration Analysis: The Way Forward [CPE Webinar]

    Guidance, examiners and industry experts agree migration analysis is a significant way to bolster the ALLL calculation. But many financial institutions are unfamiliar with how the process increases ALLL acuracy and soundness, so they choose to remain with existing methodologies.

    You may have already seen it, but I wanted to invite you to a CPE webinar Sageworks is hosting next week:
    Migration Analysis: The Way Forward for an Effective ALLL. Consultants will discuss
    • the migration analysis process,

    • common hangups and

    • some "first steps" for institutions considering migration analysis in the future.
    The webinar will be Wednesday, June 18th at 11am EDT, and you can receive one hour of CPE credit for your attendance. Register Now.

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    Shazam Collaborates on Seamless Digital Banking Services

    Shazam Network, a provider of financial services to community financial institutions and D3 Banking, a player in omnichannel, data-driven digital banking, have announced a coordinated effort to provide a comprehensive set of digital banking services to community financial institutions.

    D3 Banking consolidates digital channels in a single solution that lets consumers use any device to access the digital services of their FI — and allows the FI to control the user experience across multiple digital operating systems and sizes.

    The solution’s data analytics provide users a complete view of their financial patterns and planning, and give FIs the means to personalize advice and services for customers.

    “[Shazam’s] core software experience in driving multi-tenant deployments has been invaluable in the design of D3 Banking to ensure that the company’s solution can be configured to serve the unique digital banking needs of any financial institution,” said D3 CEO Mark Vipond. “They have been a great partner for our company and we are excited to work with them to deploy D3 Banking in a SaaS environment in service of their customers.“

    Shazam CFO Scott Dobesh said the D3 Banking solution will help FIs offer an exceptional digital experience with reduced operating costs and complexity, as well as more powerful data analytics to improve customer service and retention.

    “The future will belong to those who offer consumers a consistent and reliable user experience regardless of what device they use to access and manage their money,” he said.

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    2014 Financial Email Marketing Benchmark Report

    A CBSC preferred provider since 1988, Harland Clarke analyzed the email campaigns of more than 120 financial institutions throughout 2013 to compile this
    research study, which includes an analysis of trends related to recipient response rates, mailing frequency, deployment size, deployment type, and more.

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    News from the Bench: Beware of Mortgage Loans from Unlicensed Originators

    A recent Illinois Appellate Court decision should incent banks that are purchasing a mortgage loan or a participation in a mortgage loan from a non-bank lender to make sure that its “to do” checklist for due diligence includes absolute confirmation that a non-bank originator was properly licensed under Illinois’ Residential Mortgage License Act of 1987.
    See First Mortage Company vs, Dina Details.

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    Tips To Thwart the “Sweetheart Scam”

    Old scams never really go away. They just get reinvented and reintroduced into the marketplace. Such is the case with the Sweetheart Scam – reinvented using social media and modern banking services including online banking and remote deposit capture.

    Our latest Fraud Informer, Love Stinks, describes how criminals are romancing victims online and turning them into unwitting money mules.

    Download your copy now (282kB, no registration needed).

    This Fraud Informer provides case background, describes the fraud attack in detail, and offers tips for detecting and preventing losses that might result from this scheme.

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    Human Resources Update Scheduled for June 17

    Managing employees in an Illinois non-manufacturing business setting requires a substantial commitment to keeping informed of rapidly evolving federal and state employment law. Within the last year, a federal appellate court invalidated the sweeping changes to exempt designations for mortgage-loan originators issued by the Department of Labor in 2010; recent additional federal court rulings establish that not all MLOs must be treated as non-exempt employees. Preparing your bank to defend against enforcement action or litigation depends in large part on the quality of your preparation and documentation regarding your employment decisions. We are long past the days of true at-will employment, and thus, more than ever, the best defense is a good offense. This
    program offers both a detailed review of recent changes and trends in the law as well as practical advice for managing your employees in a manner designed to foreclose negative outcomes. Leonard Sachs and Tracy Litzinger with Howard & Howard PLLC, a business-law firm with offices in Michigan, Illinois and Nevada lead this seminar.

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    Trust Administration & Sound Regulatory Practice Scheduled for June 18

    Becky Kelly and Roger Pond, both partners at The Fiduciary Education Center, LLC, discuss this year's hot topics for auditors and regulators. Pond and Kelly develop their own
    course curricula using Campbell University and its extensive Trust Library as a resource. They review what the OCC and Fed expect in administrative and Reg 9 reviews. Kelly and Pond also discuss a variety of operations/administrative/fiduciary inconsistencies that they have come across in their travels that have generated litigation concerns for trust departments.

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    Lending to Municipalities Scheduled for June 23 & 24

    Financial institutions have identified local governments as an important target market for credit opportunities that can lead to lucrative fee-based business, such as cash management, investment management, and custody. Additionally, financial institutions find that being selected by local municipalities can create significant goodwill in the community, which can be beneficial in marketing to consumers and businesses in the area. Explore the significant differences between selling credit products to and performing credit analysis on local governments versus lending to commercial institutions and other nonprofits. Learn to identify opportunities to market credit to local governments, to discuss potential credit offerings and financial performance with prospects, and to ask for the appropriate information necessary to seek credit approval. Leading this
    seminar is Jeffery Johnson is president of Bankers Insight Group, Atlanta, GA, who has more than 25 years' experience in banking.

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    Advanced Compliance Institute to Be Held June 24 & 25

    two-day institute is intended for the experienced compliance officer and others who have a good working knowledge of the federal compliance regulations and who want to upgrade their skills in the detection and diagnosis of compliance issues, as well as their ability to influence others to solve compliance problems facing the bank. This interactive course focuses on compliance management and compliance leadership. Bankers learn how to develop process models, assess compliance risk, determine weaknesses in controls, create controls to prevent and detect problems, manage a compliance monitoring program, and influence others to implement solutions. Attendees gain valuable hands-on experience through case studies that require them to make judgments and develop influence strategies in scenarios designed to depict real-world situations. Leading this institute is Bill Elliott, CRCM, senior consultant and manager of compliance at Young & Associates, Inc.

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    Ag Lenders’ Conference Scheduled for June 26

    This jammed-packed day takes a look at a variety of issues facing agricultural lenders including what's driving agriculture in the year ahead, managing ag risk, managing third-party risk, and a farm-bill update. Attend
    CBAI's 2014 Ag Lenders' Conference to develop the skills and tools to better understand the issues affecting your farm and agribusiness customers and to meet their credit needs. A mini-expo featuring the latest in products and services for ag lenders also highlights the day. Topics and speakers include host of US Farm Report, John Phipps, who presents, “What Could Possibly Go Right? Agriculture's Overlooked Upside;” Jonathan Coppess, Clinical Assistant Professor of Law & Policy University of Illinois, Champaign-Urbana, who presents “2014 Farm Bill Update;” Steve Turner, Baird Holm LLP, presents, “Agricultural Lending: Managing Third-Party Risks: What You Don't Know or Didn't' Plan for Can Be Bad;” and “Repayment Risk in a Variable-Price Environment” presented by Dr. Freddie Barnard, Professor, Department of Agricultural Economics Purdue University, West Lafayette, IN.

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    Register for CBAI’s 40th Annual Convention & Expo by June 30 for Early-Bird Pricing

    Register today for CBAI’s 40th Annual Convention & Expo, scheduled for September 18-20, 2014, at the Marriott Downtown in Chicago to receive the lowest pricing available! Expert speakers on the hottest community banking topics fill an education agenda featuring 20 break-out sessions. Dynamic and highly sought after speaker and leadership expert Tom Flick takes the stage for the Opening Breakfast and shares his passion for raising more effective leaders through his unique gift to connect with the listeners’ hearts as well as their heads. Golfers are treated to a beautiful, classic-style course with an amazing history of championship golf in Flossmoor Country Club. Also on the agenda is the Welcoming Reception with BancPac Live and Silent Auction, a jam-packed exhibit hall with 100 booths, fun partner’s programs exploring the exciting city of Chicago, a Closing General Session, and much more. Our annual showcase event closes with the unforgettable music of the seventies, including Hollie Vest as Tina Turner, Quentin Flagg and Bill Downey as The Blues Brothers, and Stayin’ Alive, the number-one Bee Gees tribute band in the world. Don’t miss CBAI’s 40th anniversary celebration, “Looking to the Past to Plan for the Future.”
    Register now for early-bird pricing through June 30. Please click here to add a reminder to your Outlook calendar for CBAI's showcase event!

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    THROUGH 7/31/2014






    Finer Points Blog

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