IBAT News

Regulatory Burden


Borrowing a page from the IBAT
songbook, Texas Banking Commissioner Charles Cooper makes a strong case for
federal banking regulators to use tiered regulation discretion in promulgating
consumer compliance laws.  His excellent BankThink opinion piece, which appeared in last Thursday\'s American Banker, cites
empirical evidence from the FDIC and the National Survey of Unbanked and Underbanked Households
demonstrating the reluctance of small banks to develop products that could
assist members of the underserved community due to the regulatory risks
associated with doing so.

Cooper observes that "regulations and supervisory processes that drive
financial services out of the mainstream banking system and into the shadow
need to be rooted out and made more reasonable."

Cooper\'s opinion piece comes at an opportune time as IBAT and ICBA continue to
pound the drum in DC for comprehensive regulatory relief and reform consistent
with community bank business models.

IBAT commends the Commissioner for his tireless and fearless leadership in
attempting to bring some semblance of reform and reasonableness to the
regulatory compliance overkill that has fallen disproportionately on community
banks and is stifling innovation and service to bank customers.

Compliance Education

 


Beginning
April 1, every ICBA member can receive unlimited access to 50 of the most asked
for online compliance training courses at no cost through Sept. 30, 2013. The
curriculum for each compliance course has been written within the last 12
months and will be amended as required going forward. Each class is between 45
and 60 minutes long and has a test upon completion. CPE credits are awarded for
successful completion of classes with an 80 percent or higher score. Your
bank\'s administrator will be able to download a report listing each class your
employee has taken and passed which will provide verification of your employee\'s
continuing education for examination and record keeping.

Your
community bank can continue the unlimited access through the following 12
months beyond Sept. 30, for just $99. So in effect, ICBA member banks will have
unlimited access to 50 of the most asked for online compliance training courses
for 18 months for just $99.

Click here for more information. 

Staff contact: Julie Courtney, jcourtney@ibat.org,
512-275-2227

Baker Market Update

So,
what\'s the big deal? Can\'t the bankers in Cyprus enjoy a little Spring Break
without the rest of the financial world becoming unhinged? Apparently not.
Banks on the island nation remain closed [Friday] as they have been all week in
an FDR-style holiday. While Cypriot government officials have been wrangling
with other officials from the European Union, the European Central Bank, and
the International Monetary Fund in an attempt to keep that nation\'s banking
system from turning into Cyprus mulch, fear of a run on the banks has kept
their doors closed. Negotiations continue [Friday] in an effort to prevent not
only a sovereign bankruptcy, but also a possible exit from the EU. Reactions by
credit markets remind us that the fear trade is alive and well as
safety-seeking funds found their way to the U.S. Treasury market. Bond
investors saw the yield on the Benchmark Ten Year Treasury Note fall to around
1.90% after beginning the week about ten basis points higher. With no economic
data releases on today\'s calendar, a slight sell-off has nudged that yield up
to around 1.92%... Read more in the Baker Market Update

Amber Alert


THIS IS A CHILD
ABDUCTION ALERT ISSUED BY THE TEXAS AMBER ALERT NETWORK

The Dallas
Police Department  is searching for Aron Lavon
Jones, Black, Male,  16 years old, DOB
08/28/96, 5 ft. 7 inches, 160 lbs, Black Hair, Brown Eyes last seen wearing
black polo shirt khaki pants and blue/white sneakers.

Police are
looking for Tarvarus Stuckey, Black, Male, 24, years
old, DOB 03/26/1989, 6 feet, 4 inches, 185 Lbs, Black
Hair, Brown Eyes.               

The suspect
is driving a Gold, 2005, Land Rover, with TX License Plate Number of DN2B787. 
The suspect was last heard from in Dallas.

Law
enforcement officials believe this child to be in grave or immediate danger.

If you have
any information regarding this abduction, call the Dallas
Police Department at (214) 671-4268.

Aron Lavon Jones       Tarvarus Stuckey

Cyber Loss on the Rise


Financial
institutions lost more than $16 million dollars in 2012 due to cyber crime,
according to a recent Ponemon Institute research study.  The study, cited
in a UBM Tech White Paper, points to an ever-growing
problem, as the total losses were up 11% year over year.  

The
white paper cites the challenges facing community banks in adapting to customer
demands while maintaining security in web, mobile and internal platforms.
 These challenges are often compounded, according to the paper, by the
fact that many "organizations vary in terms of their willingness to hand
off security responsibilities."

It
went on to cite a 2011 survey of Chief Information officers, focused on
identifying the eight IT habits of high performing banks, saying,
"investments in IT solutions, mobile banking and strategic outsourcing to
banking technology vendors [are] key characteristics of high-performing banking
that had a greater return on operating capital, equity, and assets."

The
full white paper is available to download here.

Additionally, IBAT Financial Services might be a resource to you in
providing Cyber Insurance coverage.  Please contact Carol Troy at
512-474-6889 for more information.

Special Report


Information received since the Federal Open Market Committee met in January suggests a return to moderate economic growth following a pause late last year. Labor market conditions have shown signs of improvement in recent months but the unemployment rate remains elevated. Household spending and business fixed investment advanced, and the housing sector has strengthened further, but fiscal policy has become somewhat more restrictive. Inflation has been running somewhat below the Committee\'s longer-run objective, apart from temporary variations that largely reflect fluctuations in energy prices. Longer-term inflation expectations have remained stable.

Consistent with its statutory mandate, the Committee seeks to foster maximum employment and price stability. The Committee expects that, with appropriate policy accommodation, economic growth will proceed at a moderate pace and the unemployment rate will gradually decline toward levels the Committee judges consistent with its dual mandate. The Committee continues to see downside risks to the economic outlook. The Committee also anticipates that inflation over the medium term likely will run at or below its 2 percent objective.  Read more in this special edition of the Baker Market Update.

Silver Alert


AFFECTED TEXAS COUNTIES AND/OR NWS REGIONS:

NWS
REGIONS San Angelo, Fort Worth
     

THIS IS A MISSING
SENIOR ALERT ISSUED BY THE TEXAS SILVER ALERT NETWORK

THE
BROWNWOOD POLICE DEPARTMENT IS SEARCHING FOR THOMAS VARD WOODRUFF, WHITE, MALE,
70 YEARS OLD, DOB 11/08/1942, HEIGHT 6\'0", WEIGHT 260, BLACK HAIR, HAZEL
EYES, WEARING LIGHT-COLORED SHIRT, BLUE JACKET & TAN PANTS WITH
CONDITION(S): DEMENTIA.

THE
SENIOR CITIZEN WAS LAST SEEN 03/25/2013 14:00:00 AT 2601 CROCKETT DRIVE ON
FOOT.

LAW
ENFORCEMENT OFFICIALS BELIEVE THIS SENIOR CITIZEN\'S DISAPPEARANCE POSES A
CREDIBLE THREAT TO HIS OWN HEALTH AND SAFETY.

IF YOU
HAVE ANY INFORMATION REGARDING THIS MISSING SENIOR CITIZEN, CONTACT THE
BROWNWOOD POLICE DEPARTMENT AT (325) 646-2525

NEWS MEDIA POINT OF CONTACT IS BROWNWOOD POLICE
DEPARTMENT AT (325) 646-2525.

What Your Board Should Know


The following article appears in the current March/April edition of The
Texas Independent Banker
magazine. 

What Your Board of Directors Should Know: Creating a Strong (and Effective!) Community Bank Board of Directors

By Kelly Goulart

We all recognize that bank directors must make decisions that impact
three very distinct stakeholders - shareholders, depositors, and
regulators.  There is another distinct stakeholder for a community bank
board:  the very community they live, work, and worship in.  The fact
that we call on our community bank board members to help supervise and guide a
critical part of communities across the state means that a community bank board
member must be balanced, competent, and committed to the task.  Not an
easy chore when trying to identify and develop candidates for the job.

First, a board member should be balanced.  One critical task is
making sure that whomever is selected reflects the community, but is not
duplicative of another board member.  Individually they understand the
market and have a strategic vision for the bank that resonates with
shareholders and senior management.   Those individuals understand
that the role of a board member is to focus on the sustained value of the bank
while growing their community, and how they can contribute to both.  However, board members and candidates should have
diverse profiles and thoughts.  A diversity of skills, expertise and
experience promotes discussion and a certain amount of what we like to call
"efficient friction."  This kind of balanced board membership can
bring real value to the bank by addressing the wants and needs of each group of
stakeholders and providing strategic vision.

A board member should be competent.  Gone are the days when Aunt
Tilly was put on the board for the simple fact Aunt Tilly\'s family has had a
member on the board for 50 years.  Any candidate being considered should
bring strong business expertise to the board, preferably banking
experience.  Simply put, the day of the amateur part-time board member is
over.  Look for community business leaders who understand the wants and
needs of the various stakeholders, understand the concept of risk
management,  and can make tough business decisions.  But just because
they are strong business leaders does not mean they will be equally effective
as board members.  They need to be consensus builders.  Each board
member should work toward making sure the board functions as a team and that it
understands and "owns" the strategy of the organization.

Finally, a board member should be very committed to the role. 
Being a member of a community bank board takes a certain level of dedication
that not every person can muster.  For example, any individual being
considered should be unequivocally dedicated to the continuing educational
demands that will be placed upon them.  This requirement should be clearly
addressed in both the appointment process for selecting candidates and in the
responsibilities for continuing board members.

Karen Neeley, IBAT General Counsel, in a recent email wrote, "I would
suggest that one important issue is director training.  They need to be
educated not only on their core duties and responsibilities and liabilities but
also more specifically on topics such as BSA/AML and fair lending.  They
absolutely must understand "conflict of interest" issues, code of
conduct/ethics requirements (including Bank Bribery Act), and confidentiality
requirements.  Regulation O and Regulation W are very important for them
to understand as well."  That level of education and understanding will
require a board candidate who is committed and willing not only to learn, but
to re-learn.

So any prospective board member should
be balanced, competent, and committed.  That should be made clear from the
very beginning.  The last thing that should happen is, after joining the
board, an individual says "I had no idea it was going to be so much
work!"  One way to help avoid that is by providing every prospective (and
existing) board member with a written "job" description.  That job
description should address the role of the director and what exactly will be
expected of them, including the time and educational commitment.  Everyone
should have a very clear understanding of the strategic function of the board
and should sign off on a job description that includes their role and specific
responsibilities before joining the board.  It\'s a good idea for the board
to revisit those written "job" descriptions at least annually so they can
sharpen their focus. 

Kelly Goulart is IBAT\'s Regulatory Compliance Manager.

CCBCO Designation


IBAT is pleased to announce that
Kelly Goulart recently earned the Certified Community Bank Compliance Officer
designation, offered by the Independent Community Bankers of America
(ICBA). 

Goulart currently serves as IBAT\'s Regulatory Compliance Manager, part of our
compliance team answering member questions through the Compliance Helpline.
 He began his career in banking in 1986 as an Internal Auditor and shortly
thereafter moved into regulatory compliance.  He has worked in banks and
as a consultant in Virginia, South Carolina and Texas in the areas of
compliance and credit review. He has held the positions of Compliance Officer,
Chief Operations Officer, Chief Financial Officer and Director.

Upcoming Webinar

We invite you to join Travelers for a webinar presented through Bond & Financial Products Financial Institutions, on March 19, 2013 (1 p.m. CT). Thomas Bieging and Timothy Krsul will discuss potential lender liability issues in commercial loan foreclosures. 

The presentation is intended to outline the steps to avoid lender liability claims in the commercial loan foreclosure context. 

About the presenters:
Thomas Bieging is a partner with Bieging Shapiro & Barber LLP. He focuses his practice in the areas of banking and commercial litigation.
Mr. Bieging\'s financial institutions practice includes holding company and change of control applications, loan documentation, regulatory compliance advice, loan work-outs, and the sale, acquisition and merger of banks and bank holding companies. He has litigated with government agencies on financial institution policy matters with national implications. His extensive financial institution regulatory practice includes the negotiation of regulatory agreements, business and capital plans, acquisitions and chartering. He has been involved in lender liability litigation defending financial institutions. He serves as counsel to the Independent Bankers of Colorado.

Timothy Krsul is a managing director with Travelers\' Bond & Financial Products Claim Group and has been with the organization since April 2005. Prior to joining Travelers, Mr. Krsul was a partner with the litigation practice group of Oppenheimer Wolfe & Donnelly in Minneapolis. There he handled complex commercial litigation. Mr. Krsul has 11 years of litigation and commercial transaction experience in private practice.

Register here for the March 19th webinar.

Staff contact: Carol Troy, ctroy@ibat.org, 512-275-2236

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