Legislative White Paper

IBAT’s post-legislative session white paper, The 2013 Legislative Session: Action and Inaction is now available for download.  The white paper serves to compliment the already-made-available 2013 Legislative Update Webinar

The 83rd Texas Legislature passed a number of bills impacting  community banks, including:

  • Property Tax Lender Reforms
  • Prohibition on Debit Card Surcharges
  • Interest and Fees on Loans
  • Regulatory Oversight
  • Foreclosure
  • Trusts
  • Taxes

IBAT General Counsel Karen Neeley addresses these topics, as well as others which will undoubtedly arise in future sessions.

Bank Director Assembly

Join your peers for SWGSB's 137th Assembly for Bank Directors, an important conference on board duties and responsibilities. With the community banking industry facing unprecedented changes and challenges, top banking insiders are invited to discuss in depth Superior Community Banking: Reaching for Success. On the agenda are critical issues bank boards nationwide are addressing, such as:

  • economic outlook;
  • compliance risks;
  • regulatory issues;
  • strategic issues;
  • brand communication; and
  • key survival strategies.

Workshops will give you the opportunity to "drill down" further to gain a complete understanding of regulator expectations and stress testing. For more details about the program, and to register, please click here.

Urgent Edition Webinar

Basel III Final Rule: 
Impact on Community Banks: Effective January 1, 2014

Available ONLY via Archived Webinar (Includes FREE CD ROM)

Archived webinar available Friday, July 26, 2013

(See July 26, 2013, on order form.)

The final rules for the implementation of Basel III capital calculations will have a significant impact on community banks.  While lobbying efforts were successful in eliminating many of the most egregious components of the proposed rule, the final rule maintains some negative aspects.  This webinar will cover the final rule and its implication for community banks, and provide a proven methodology for implementing Basel III into your bank’s capital planning and contingency. 


  • Final Basel III risk-based capital requirements for community banks

  • Impact of 1-4 family real estate changes

  • Effect of unrealized gains and losses within the investment portfolio

  • Understand and calculate the impact of highly-volatile commercial real estate

  • Additional capital needed to support non-performing loans

  • Impact of trust-preferred securities

  • How to use the final Basel III rules in determining capital adequacy

  • Perils to avoid in determining capital adequacy

  • How capital changes impact strategic planning

  • Practical approach for developing a capital-contingency plan


    • Example of methodologies to:

      • Assess the impact of Basel III on your bank

      • Determine capital adequacy

      • Stress test capital

    • Employee training log

    • Quiz you can administer to measure staff learning and a separate answer key

Attendance verification for CE credits provided upon request.


This informative session is designed for community bank presidents, chief financial officers, and board members who want to remain proactive in dealing with bank capital.

ABOUT THE PRESENTER – Gary J. Young, CEO, Young & Associates, Inc.

Gary J. Young is Chief Executive Officer of Young & Associates, Inc.  During 34 years in consulting and 45 years in the industry, he has assisted hundreds of financial institutions from coast-to-coast with improving shareholder value and profit, establishing effective strategic plans, management assessments, regulatory concerns, budgeting, asset/liability management, expansion planning, and mergers and acquisitions. 

Gary is a popular speaker due to his practical and valuable insight and has conducted seminars throughout the United States and in Europe.  Gary is on the board of a community bank, manages a bank investment fund, and is a co-founder of Capital Market Securities, Inc., which assists with mergers and acquisitions.



The archived webinar is a recording that includes the audio, visuals, and handouts. We even provide the presenter’s email address so you may ask follow-up questions. You will receive an email with the archived webinar link.  This webinar link can be viewed anytime 24/7, and will expire 6 months after the original availability date.

As an added bonus, you will also receive a FREE audio/visual CD ROM.* The CD ROM includes the original audio/visual presentation, the question and answer sessions, and the handouts.  Use the archived webinar or this “off-the-shelf” program for future training.

The archived webinar (including the free CD ROM) may ONLY be ordered for 6 months following the original availability date.  Neither the link nor CD will be available after this time.

Note:  All materials are subject to copyright.  Transmission, retransmission, or republishing this webinar to other institutions or those not employed by your financial institution is prohibited.  Print materials may be copied for eligible participants only.


*CD ROM is for Mac and PC use only

Financial Literacy Summit

Have you been considering charting or increasing your outreach in financial education? If so, you won't want to miss next week's Financial Literacy Summit. See the amazing line-up of speakers.

ACTION: Send a representative from your bank. Don't be left scrambling as this conversation develops at the national, state and local levels.

Here's a snapshot of what this annual summit provides:

  • Community banking CEOs talking strategy - the WHY;
  • Winners of the IBAT Best of Community Banking Awards showing proven methods - the HOW;
  • Current research on high school students and personal finance management;
  • Best practices from bankers who are using Money Smart, Building Wealth, Junior Achievement and will share what has worked, not worked in their markets; and
  • A sneak peek at the CFPB plans for financial education. You may have seen that last night, Richard Cordray received confirmation as the Director of the Consumer Finance Protection Bureau.

By choosing to be part of the conversation, your bank will be leaps ahead of those who do not attend. We offer this comprehensive program only once a year. Can you afford to put your financial education strategy into hibernation for a full year?

Register today - only a few rooms remain in our block at Hotel ZaZa.

The 21st Century Glass-Steagall Act

Senator Elizabeth Warren along with John McCain, Maria Cantwell and Angus King, have introduced "The 21st Century Glass-Steagall Act," a bill aimed at separating core banking activities from insurance, securities and other non-bank financial services endeavors.  

The bill, S. 1282, is clearly another indication that the risks and inequities associated with too-big-to-fail are continuing to garner attention in Washington.  

The IBAT Board of Directors in late June reaffirmed their support of the Brown-Vitter bill, requiring higher capital levels for banks over $500 Billion in assets, and taking direct aim at the myriad problems of too-big-to-fail. "We are pleased that the debate on too-big-to-fail is moving forward and the visibility of this issue continues to increase," said Christopher Williston, IBAT President and CEO.  "It is something that needs to be addressed, and soon.  Obviously there are significant headwinds, and the largest of the financial conglomerates want no part of these proposals.  We will continue to push for more parity, and our ultimate hope is for a real two-tiered regulatory system – something that Elizabeth Warren and others have embraced."

Further information is available on Senator Warren's website, and we will be closely monitoring the progress of this initiative. 

Special Statement

Independent Bankers Association of Texas (IBAT) President and Chief Executive Officer Christopher L. Williston made the following statement upon the release of “The Protecting American Taxpayers and Homeowners (PATH) Act,” proposed housing finance reform legislation.

“The comprehensive draft legislation released by Chairman Jeb Hensarling boldly addresses a number of critical issues in a broken and unsustainable housing finance environment.

“Housing finance in various forms is a significant line of business for a large percentage of community banks across Texas and the nation, and this sector clearly contributes greatly to the overall economy. Legislative and regulatory remedies addressing the well-documented problems and abuses contributing to the ‘meltdown’ have, as is typical, gone too far and are creating issues with availability and affordability of mortgage and housing credit. 

“Of particular concern to community banks are limitations and new requirements on mortgage lending that impact ‘in portfolio’ loans, i.e., loans kept as assets on a bank’s balance sheet for which the lender takes on the entirety of the risk. The exemption of these loans from a number of cumbersome, expensive and questionable regulatory requirements will allow housing credit to continue to be available to a number of consumers who otherwise may go unserved.

“Further, elimination and/or delay of implementation of a number of mortgage rules impacting all mortgage loans will provide the industry an opportunity to appropriately comply and develop acceptable business models to meet the borrowing needs of their customers.

“We are strongly supportive of these provisions and appreciate the efforts and commitment of the Chairman and Committee leadership and staff. We look forward to working with various stakeholders as this important process moves forward.”

For more information, please contact Steve Scurlock, IBAT Executive Vice President, at 512-275-2226 or sscurlock@ibat.org.

TWIA Update

The Independent Insurance Agents of Texas (IIAT) released additional information about the Texas Windstorm Insurance Association last week. While we still await information from the Attorney General in response to Representative Deshotel and others' request of July 3rd - this information from IIAT addresses a different opinion released from AG Abbott and unfortunately provides no definitive solution to the ongoing concern.

Much has been written recently about the financial condition of the Texas Windstorm Insurance Association (TWIA) that may be causing you and your customers some concern. Here is the situation as we know it: Hurricane Ike claims and the continuing litigation have drained much of the TWIA reserves. Although liabilities currently exceed assets of TWIA, barring a storm this year, TWIA does anticipate being in the black by the end of the year. Some have argued that the State may provide financial back up for TWIA, but Attorney General Abbott issued an opinion on July 1 on that question posed earlier by Rep. John Smithee. In summary, it states, "The Legislature has chosen not to obligate the State to pay unfunded losses the Texas Windstorm Insurance Association is obligated to pay."

TWIA remains under supervision of the Texas Department of Insurance. The former Insurance Commissioner, in her last official act at the end of May 2013, refused to allow the TWIA Board to renew a $500 million Bond Anticipation Note (BAN) which, if needed, could provide TWIA with immediate funds for claims payment. New Insurance Commissioner Julia Rathgeber may reverse that decision, but until that determination is made, it is uncertain if TWIA can respond to another storm of any significance.

TWIA has produced an illustration showing its funding over the past six years as well as the available funding in 2013, both with the BAN funding and excluding the BAN. Much of the funding is predicated on the ability for the Texas Public Finance Authority (TPFA) to sell Class 1 and Class 2 Public Securities, also known as pre-event or post-event catastrophe bonds. These types of bonds are used to varying degrees by other wind pools to finance catastrophic losses. The ability or the inability for the TPFA to sell these catastrophe bonds is one reason that payment of all TWIA claims cannot be guaranteed.

We will continue to monitor the situation and extend our sincere gratitude to Lee Loftis, Governmental Affairs of IIAT for allowing us to share their comments with IBAT.

First American Payment Systems Wins ATSI Call Center Award of Distinction


Outstanding Service Earns National Award
First American Payment Systems Wins ATSI Call Center Award of Distinction

First American Payment Systems of Fort Worth, TX has been honored with the prestigious 2013 ATSI Call Center Award of Distinction by the Association of TeleServices International (ATSI).  The industry’s Trade Association for providers of Call Center services, recognized First American Payment Systems at ATSI’s 2013 Annual Convention held at the Kansas City Marriott Downtown, Kansas City, MO.

The Call Center Award of Distinction is a tool used to measure the skills of professional Call Center Agents throughout North America and the UK.

After six months of testing, an independent panel of judges scores call-handling skills for “enhanced service” applications, focusing attention on customer relationship management (CRM), courtesy, etiquette, and the use of proper call techniques, as well as response time and accuracy - the cornerstones of the Call Management Industry.

“Participating in the Award of Distinction is an award in itself. To meet the ever changing needs of clients requiring a higher level of attention and focus, Call Centers have had to expand their level of services. Winning the Award of Distinction demonstrates a proactive approach for going above and beyond the multiple needs of the client while providing enhanced service applications.  This attention to customer relationship management combined with a “WOW Experience” for every client and caller results in world class customer service,” says ATSI President Maryann Wetmore.

ATSI extends its congratulations to the staff of First American Payment Systems on their proven quality service to their customers.

About ATSI
The Association of TeleServices International was founded in 1942 as a national trade association representing live answering services.  ATSI now encompasses companies across North America and the UK offering specialized and enhanced operator based services including: call centers, contact centers, inbound telemarketing (order entry), paging, voice messaging, emergency dispatch, fax, and internet services among others.

Association of TeleServices International, Inc.
12100 Sunset Hill Rd., Ste 130, Reston, VA 20190
Phone  (866) 362-9489  Fax (703) 435-4390
CONTACT:  Bob Dziuban or Pam Owens
(866) 896-2874


Housing Finance Legislation

As anticipated, Financial Services Committee Chairman Jeb Hensarling has released a broad and aggressive proposal addressing a number of issues relating to housing finance - "The Protecting American Taxpayers and Homeowners (PATH) Act."

In addition to phasing out Fannie and Freddie, and refocusing the mission of the FHA, the proposal contains significant regulatory relief in the mortgage lending arena.  The Committee release and Executive Summary provides significant additional information.

Additionally, IBAT issued a statement regarding the proposal, applauding the inclusion of meaningful reforms to stifling regulatory burden on mortgage lending, with a focus on in-portfolio lending.  For in-portfolio loans, the ability-to-repay, escrow requirements and several other provisions are eliminated. Further, for all mortgage loans, the Dodd-Frank high-cost definition, prohibition on balloon payments, ability-to-repay as a defense to foreclosure, prohibition on arbitration and other requirements go away.  

This will clearly be a long and arduous process, and IBAT will continue to be highly engaged with the Chairman, other members of Congress and Committee staff as we attempt to work through these critical issues.

Week in Review: July 12, 2013

For those who were lucky enough to be a teenager during the 70's, you may recall the urban myth surrounding everybody's favorite rock band, Led Zeppelin. It was rumored that if one played "Stairway to Heaven" backwards, at high speed, hidden messages could be detected. Well, coming from one who tried to find those hidden messages, they were never discovered and all I succeeded in doing was scratching up my favorite album. Now, I realize that some readers won't know what a record album is, but that's beside the point. The point is, as experts and non-experts alike continue to pour over the recently released minutes of June's FOMC meeting looking for hidden messages, it just may be that there aren't any. When Mr. Bernanke says that discussions of "tapering" are not intended to be signals of policy changes, maybe that's actually what he means. Policy has not changed. What has changed... Read more in the Baker Market Update.

Elizabeth Duke Resignation

Federal Reserve Governor Elizabeth “Betsy” Duke announced  last week her resignation from the Board effective August 31.  Governor Duke served as Chairman of both the Committee on Consumer and Community Affairs and the Subcommittee on Supervision and Regulation of Community and Small Regional Banking Organizations.

A “real” banker, she had experience in both regional and community banking prior to joining the Fed Board.

“Governor Duke has clearly been the ‘go-to’ person for us and the community banking industry”, said Christopher Williston, IBAT President and CEO.  “She ‘gets it’, and will be sorely missed.  We have had the pleasure of meeting with Governor Duke to discuss a number of issues, including Basel, fair lending concerns, mortgage lending challenges and a two-tiered regulatory system.  She is indeed an impressive individual, and we very much appreciate her service to the industry and the country.  We obviously wish her the very best in whatever she chooses to pursue going forward.”


Was the Board of the Texas Windstorm Insurance Association and/or the Texas Department of Insurance negligent in failing to fully assess insurance carriers for losses from recent windstorms?  That's the question posed to the Texas Attorney General's office in a request for opinion issued by six members of the Texas House of Representatives.  

In total, insurers were assessed $530 million, but that was inadequate to cover losses from Hurricane Ike in 2008 – one of the primary events that led to the current financial concerns of TWIA.   Since TWIA has and/or had the authority to further assess insurance carriers to cover losses, the Representatives are asking Abbott to weigh in on the TWIA Board's inaction with regard to insurance carrier assessment.  

A complete copy of the request is available on the IBAT website and includes a thorough summary of events leading to the request.

Silver Alert




The TYLER POLICE DEPARTMENT is searching for WALTER JAMES GRAY, diagnosed with DEPRESSIVE PSYCHOSIS, BLACK, MALE, 80 years old, DOB 03/09/1933, HEIGHT 5’ 9”, WEIGHT 160 lbs, GRAY Hair, BROWN Eyes, BEIGE JUMPSUIT.

The senior citizen was last seen at 0221, 07/10/2013 at 1501 W 29TH STREET TYLER, TX, he is 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 TYLER POLICE DEPARTMENT at 903-531-1000.

News Media Point of Contact is TYLER POLICE DEPARTMENT at 903-531-1000.

A Closer Look

Last week's unanimous vote by the Board of Governors of the Federal Reserve System adopting final Basel Rules has drawn generally positive reactions from community bankers.  Many IBAT members who responded to IBAT's breaking news email last week were relieved that federal regulators abandoned preliminary plans to apply complicated risk weighting categories to various real property assets.

Bankers also rejoiced when learning that community banks under $250 billion in assets have an option to opt out of marking to market the value of their bond and securities portfolios (AOCI) and the potential devastating impact that requirement would have meant for capital impairment as rates begin to rise. Still others (banks under $15 billion) celebrated the grandfathering of Trust Preferred Securities consistent with the phase out (2031) in the Dodd/Frank Financial Modernization Act.

While IBAT was disappointed that regulators chose not to provide an outright Basel III exclusion for community banks under $50 billion, as advocated in IBAT's comment letter, IBAT President and CEO Chris Williston offered these observations. "Generally, we are ecstatic with the final rule.  While we didn't get everything we hoped for, we commend the regulatory community for listening to our concerns and making the necessary adjustments with the realization that community banks operate under a different business model than the large systemically important banks and deserve special considerations and exemptions accordingly."

ICBA has raised concerns about the new threshold limits of mortgage servicing rights which could affect some members who maintain large mortgage portfolios and the new capital conservation buffer (2.5% of risk-weighted assets) that will be required under the proposal. The Fed has provided a one page guide on the implications of the final rule on community banks that can be found here.

So what's next?  The FDIC and the OCC are both expected to approve identical final rules this week. Once approved by all three agencies, the new Basel III requirements will go into effect for community banks under $50 billion on January 1, 2015 barring any Congressional attempts to modify the final rules. Lawmakers are carefully reviewing the implications of the new rules and it is possible that legislation will be introduced to further modify or eliminate the rule entirely prior to its implementation.

Staff contact: Chris Williston, cwilliston@ibat.org, 512-474-6889