Executive Profile - The Independent Community Bankers of America

2011 in Focus
“One of the most
important things
for the bank and
its customers is
to be positive and
make things work.
A positive mental
attitude will go a
long way.”
— R . Va n B o g a n ,
Florida Bank of
Commerce
p h o t o b y R I K U + A N N A Pi c t ur e s
What Bankers
Think
Cautiously optimistic about the future, community
bankers project a slow but steady economic recovery
that presents new challenges and opportunities
By Apryl Motley
32 ICBA IndependentBanker January 2011
IB Thought Leaders
“T
he reports of my demise
are greatly exaggerated.”
Attributed to Mark Twain after
he read his own obituary in the
newspaper, this expression might
be the new mantra for community banks. Certainly, it’s been a
tough couple of years, but community bankers across the nation
are adamant about their ability to
not only survive the recession but
to thrive in spite of it.
“The brightest spot in the whole
financial industry is community
banks,” says R. Van Bogan, chairman of Florida Bank of Commerce
in Orlando, Fla. “Community
banks represent a great opportunity for our financial system over
the next five years. We have a
chance to move forward.”
At the same time, Robert
Barsness, chairman and president
of Prior Lake State Bank in Prior
Lake, Minn., acknowledges that
a number of community banks
have failed, and some are still
struggling. However, he says,
“People see us as the strength
of our communities. Community
banks will continue to be a major
force in the U.S. economy.”
Even so, “it’s a very difficult
outlook for community banks,”
observes Robert A. Catanzaro,
co-founder and president of
East Greenwich, R.I.-based
Independence Bank. “The economy is still challenging, and
the regulatory environment is
onerous.”
Steven R. Gardner, president
and CEO of Pacific Premier Bank
in Costa Mesa, Calif., sees the
potential for community banks to
benefit from regulatory reform:
“Compliance with the new regulations will be a bigger burden
for larger banks, which will affect
their profitability and drive more
customers to community banks.”
If that’s the case, community
banks must start planning. From
east to west, here’s a look at how
six are positioning themselves for
success in 2011.
Robert Barsness
chairman and president
Prior Lake State Bank
Prior Lake, Minn.
Bank Stats: $193 million assets,
3 branches, 35 employees
Robert A. Catanzaro
president
Independence Bank
East Greenwich, R.I.
Bank Stats: $70 million assets,
1 location, 18 employees
Steven R. Gardner
president and CEO
Pacific Premier Bank
Costa Mesa, Calif.
Bank Stats: $840 million assets,
6 branches, 100 employees
Edgar Purdom
CEO
Louisa Community Bank
Louisa, Ky.
Bank Stats: $25 million assets,
1 location, 11 employees
Rebeca Romero Rainey
board chair and CEO
Centinel Bank of Taos
Taos, N.M.
Bank Stats: $172 million assets,
3 branches, 58 employees
R. Van Bogan
chairman
Florida Bank of Commerce
Orlando, Fla.
Bank Stats: $240 million assets,
6 branches, 48 employees
www.icba.org ICBA IndependentBanker 33
2011 in Focus
“We need to celebrate
our successes and tell
our story when things
aren’t going right.”
— R e b e c a R o m e r o R a i n e y,
C e n t i n e l B a n k o f Ta o s
photo by wende woolley
Banking on business
“Our local economy is still in
tough shape,” says Catanzaro, who
serves as the Rhode Island state
director for ICBA. “Historically,
Rhode Island has been the first
in and last out when it comes
to recessions. We tend to have
higher unemployment for a
longer period of time.”
According to Catanzaro,
the state’s unemployment rate
reached 11.4 percent but is trending downward. “The bottom did
not fall out, and that’s a good
thing,” he says. “However, small
businesses are still struggling, and
it’s probably going to be a long
time before we get the jobs back
that we’ve lost during the last
couple of years.”
On the other hand, Catanzaro
doesn’t believe that retail and
manufacturing, the foundation
for the state’s economy, are dead
34 ICBA IndependentBanker January 2011
by any means. “We have a good
mix of industries for a small
state,” he says. “We’re not dependent upon one industry, and we
have a lot of small businesses.”
Lending to smaller businesses
is where the $70 million-asset
community bank has found its
niche. Independence Bank participates in the Small Business
Administration’s preferred lenders program and has been active
in all facets of SBA lending:
7(a), 504, LowDoc, Express and
CapLines. Recent loans include
those to a coffee-roasting company and a firm that specializes
in geothermal work for schools
and municipal buildings. The
bank is also working with export
businesses through SBA’s Export
Working Capital Program.
Some new customers are
coming to Independence Bank
from big banks that are not
renewing the lines of credit for
businesses that have shown losses
during the past of couple years.
“Some of the loans we can’t do,
but if we feel the situation was
temporary due to economic circumstances and the business is
still viable, we’ll make the loans,”
Catanzaro says.
“We look at each loan individually and at the overall cash
management of that business,” he
continues. “Companies are showing losses, but there are a lot of
viable businesses that may have
had a one- or two-year loss.”
Further, Catanzaro says, there
continues to be a demand for commercial credit in Independence
Bank’s market. The bank also
has had success using technology to increase its footprint to
serve businesses in Massachusetts
and Connecticut. Cool Deposit,
the bank’s commercial remote
deposit capture program, was
launched in 2005. “We couldn’t
afford to build bricks-and-mortar
branches, so we brought the bank
to the customer’s place of business,” Catanzaro says. As such, the
bank has no immediate plans to
increase its locations beyond one.
Catanzaro does plan to hire at
least one new staff person this
year to help the bank take advantage of what he describes as the
pent-up demand for commercial
credit. “The larger banks are not
really focusing on the segment
that we focus on,” he says.
Catanzaro believes that the
combination of being an active
SBA lender and offering remote
deposit capture has positioned
the bank well for this scenario:
“Being able to bundle these products for customers has really
helped us. That’s our niche. It’s
very difficult to survive on interest income alone. You need to
have something else.”
Partnering for progress
In operation since August 2006,
Kentucky’s Louisa Community
Bank is a $25 million-asset institution with one location and 11
employees. “We really couldn’t
have picked a tougher time to
start a bank,” says CEO Edgar
Purdom, who worked with the
bank as a consultant before
becoming CEO in 2009. “It’s been
a real challenge.”
The community bank is in
Lawrence County in a slightly
older community where the population is 17,000, the unemployment rate is 12 percent and most
residents get their income from
federal payments such as Social
Security. “There is no economic
growth,” Purdom says. “Coal is
the state’s number-one source of
income, and it’s currently down.
I don’t foresee any major changes
in the local economy this year.”
Like many community bankers, Purdom is concerned about
the low demand for loans. “The
Being able to bundle
these [Small Business
Administration loan]
products for customers
has really helped us.
That’s our niche. It’s
very difficult to survive
on interest income
alone. You need to have
something else.
— R o b e r t A . C ata n z a r o ,
Independence Bank
real problem is finding good loan
customers,” he explains. “Those
people who are willing to borrow
don’t have the ability to repay.
Those with the ability to repay
are not in the borrowing mood
right now.”
Yet Louisa Community Bank
has continued to increase market
share, and Purdom expects its
loan growth rate, at a projected
25 percent for this year, to be considerably higher than other community banks nationally. Because
there wasn’t enough economic
activity locally, the bank began
reaching out to a wider sphere by
partnering with other community
banks in the area. “If the market
isn’t growing locally, it’s better
to work together,” Purdom says.
“Normally, we wouldn’t go after
the same customer base. We look
at this as a temporary thing.”
Purdom sees these important,
albeit temporary, alliances as a
means for serving creditworthy
borrowers when limits on the
level of lending may come into
play. For example, one recent loan
was for the building of a doctor’s office. Ten to 15 percent of
the bank’s loan portfolio consists
of these participation loans. The
remainder consists primarily of
residential loans (40 percent)
and commercial loans to smaller
stores and mom-and-pops (30
percent).
As such, Purdom isn’t worried about competition from
larger regional or national banks:
“Technology is the great leveler.
We can do anything that a large
bank does.” Louisa Community
Bank offers Internet banking and
online bill pay. Purdom doesn’t
expect to add any new services
or products to the bank’s mix
this year, but he sees more of an
opportunity for cross-selling to
existing customers.
“As the smallest bank in the
state, we have fewer customers, so
we can give people more personal
attention and be more responsive
www.icba.org ICBA IndependentBanker 35
2011 in Focus
“We’re the good guys.
Community banks didn’t
cause the problems,
and people are realizing
this more and more.”
— R ob e rt Ba r sn e s s ,
P r i o r L a k e S tat e B a n k
photo by momento images
to customers’ needs,” Purdom
says. “All of our stockholders live
in close proximity to the bank.
They’re not just investors; they’re
members of the community.”
Bouncing back
“I see 2011 being a better year,”
says Bogan of Florida Bank of
Commerce. “The economy here
is improving—not dramatically,
but things are getting better.
Unemployment is down, and
tourism has rebounded.” He cites
increasing sales of OREO properties and some loan demand from
existing small businesses: “Small
businesses are more optimistic
about the future, and they’re
expanding a little and borrowing
to do that.”
Bogan acknowledges that
Florida has had more failed banks
than any other state in the nation.
“We still have a housing glut
38 ICBA IndependentBanker January 2011
because the market grew so fast.
It will take us a while to get out
of the glut,” he says. “However,
the vacancy rate is improving
on commercial office space, and
prices have stopped dropping on
residential properties.”
The majority of Florida Bank
of Commerce’s loan portfolio is
commercial, and Bogan says his
community bank has succeeded
in carving out a niche for itself
within the medical community.
“This field hasn’t felt the recession,” Bogan says. “As a community bank, we can really work with
doctors’ offices closely and establish a banking relationship for
their practices.” Orlando has two
major hospitals and a new medical school, and Bogan expects
that the bank’s business will grow
around these entities.
In fact, Bogan sees the $240
million-asset community bank’s
staffing growing about 10 percent
on the lending side throughout
the year, up 48 employees. “We’re
getting prepared for the growth
that will come in the second half
of this year and continue in 2012,”
he says. At the same time, with
remote deposit capture, Bogan
has no plans to increase branches
beyond the current six.
For the near future, Florida
Bank of Commerce will continue to concentrate on lending
to small businesses and banking the employees of those businesses. According to Bogan, “We
are looking for good, consistent,
steady growth. It’s nice to be a
bank in a position to be making
loans.”
Looking to lend
Last year, $193 million-asset
Prior Lake State Bank celebrated
100 years of serving a bedroom
community of 23,000-plus residents between Minneapolis and
St. Paul. “We’ve been a strong,
well-capitalized community for a
long time, and we’ll continue to
be that,” says Barsness, who has
helped lead the bank for 41 years.
“There’s certainly stress in
the marketplace,” he continues.
“Our area is bumping along the
bottom of this economy. Housing
is our major business, and recovery will be a slow process. A
number of community banks in
the area are still under stress, and
loan demand is quite low, but we
expect a gradual recovery during
this year.”
Small businesses in Prior Lake
such as construction companies,
hardware stores and restaurants
have been affected by the downturn. “We still have a lot of foreclosures from loans made by the
large institutions and mortgage
brokers,” says Barsness, a former
ICBA chairman.
Despite these challenges,
unemployment for the local area
is only 7 percent, and Barsness
says his community “is better
off than most.” At this point, his
outlook for his bank and community banks in general is positive. “We’re the good guys,” he
proclaims. “Community banks
didn’t cause the problems, and
people are realizing this more
and more.”
With its 35 employees and three
locations, Prior Lake State Bank is
the third largest employer in the
area. Barsness doesn’t anticipate
increasing the number of employees or locations in the near future,
and he’s pleased to see signs of life
in the local manufacturing and
technology industries.
More than half of the community bank’s portfolio is commercial loans, and its focus has
been on expanding existing customer relationships. “Recently,
one of our customers successfully
recruited a national chain store
for a local strip mall,” Barsness
It’s going to better than
last year, so be prepared
to take advantage of new
opportunities. Be open
to taking on more risk
if you have the capital
to support it. Stretch
yourself a little bit.
—Steven R. Gardner,
Pa c i f i c P r e m i e r B a n k
explains. “For that relationship
to move forward, the customer
needed to do renovations and
additional construction. We provided the financing to fund those
upgrades.”
With loan demand low and
competition high, Prior Lake
State Bank has established itself
as a leader in providing superior customer service. “We’ve
got megabanks right across the
street, but they’re easy competitors because they don’t provide
the same level of service as we do,”
Barsness says. “We get quite a few
clients from their customer base.”
Waiting on the weather
Rebeca Romero Rainey, Centinel
Bank of Taos board chair and
CEO since 2003 and chair of
ICBA’s Minority Bank Council,
is hoping for snow and lots of it
because that’s what drives tourism in Taos, N.M., where the $170
million-asset community bank is
located. “Our local economy is
interesting,” she says. “It’s a tourism-based economy that depends
on visitors coming here for outdoor recreation.”
According to Rainey, tourism has decreased the past two
years as has the construction of
the second or vacation homes
that are so common in the area.
“Construction has slowed because
it is primarily driven by custombuilt properties purchased by
people who will eventually make
their homes in Taos after retiring,” she explains. “The bank typically provides financing for the
purchase of the land and so forth.”
Despite the slowdown in construction and tourism, Rainey
is starting to see some signs of
improvement, which makes her
cautiously optimistic for community banks at large. “There are a
lot of unknowns based on regulatory reform,” she says. “But we
have a tremendous opportunity
to be at the table to make sure
those regulations focus on where
the problems were created, which
wasn’t community banks.”
As New Mexico’s economy
slowly recovers, Rainey expects
the demand for residential and
commercial loans to increase
slightly. This year she expects
Centinel Bank’s loan portfolio
www.icba.org ICBA IndependentBanker 39
2011 in Focus
Regulatory Reform
In Review
Community bankers agree that the impact of
Wall Street regulatory reform could have been
much worse had ICBA not achieved various
exemptions for their institutions. However,
community bankers still have concerns about
what could result from the law and how their
institutions will be affected.
Even though a lot of uncertainty remains
about how the Dodd-Frank Wall Street
Reform and Consumer Protection Act will
be implemented, community bankers have
started bracing for the worst. “We are preparing ourselves by reading as much as we
can,” says R. Van Bogan, chairman of Florida
Bank of Commerce in Orlando. “And we will
need to add a person to the compliance area
next year.”
Staffing up to address new regulatory
issues is not an option for many community
banks. The compliance department at Louisa
Community Bank in Kentucky consists of
Edgar Purdom and a compliance officer. “The
biggest problem that we have right now as
a small community bank is not having more
compliance staff,” he says. “We’ve used outside consultants to help us wade through the
morass of regulations.”
Robert Barsness, chairman and president of Minnesota’s Prior Lake State Bank,
understands Purdom’s dilemma. “It takes a
huge amount of people’s time to deal with
compliance and regulations. The smaller you
are, the more difficult it is to deal with all the
areas,” he says. “You need an expert in all
these different areas, which is time consuming and expensive.”
One area that worries Rebeca Romero
Rainey is the interchange amendment. “I am
concerned about how this will impact our
debit card revenue,” says the board chair
40 ICBA IndependentBanker January 2011
and CEO of Centinel Bank of Taos, N.M.
“How will we continue to compete in the
card issuance area?”
Barsness shares her concern about how
the Fed will set the pricing mechanism for
interchange fees. His community bank has
been encouraging customers to make paperless transactions so that they are using debit
cards instead of paper checks. “We’re paying
a higher level of interest on those accounts,”
he says. “We could face losing the revenue
stream without losing the expense. I hope
the Fed will realize these costs and come up
with a reasonable calculation.”
Community banks just want regulators to
be reasonable. “By and large, most community banks did not participate in the type of
lending or abuses that were the source of
the problems,” Catanzaro says. “It’s ironic
that in trying to get a handle on the economic situation, regulatory reform may have
the effect of forcing community banks to
say, ‘I’ve had enough.’”
Even with the provision for maintaining
their prudential regulators in place, community bankers expect that the Consumer
Financial Protection Bureau will still hold
their institutions indirectly accountable. “In
theory it sounds like community banks will
not be regulated by the CFPB,” Bogan says.
“But other regulators will follow the bureau’s
lead. It’s going to change the way we do business forever.”
According to Rainey, that’s all the more
reason for community bankers to remain
engaged in the regulatory process by submitting comments and talking with legislators: “I
am a firm believer that our voice needs to be
heard about the unintended consequences of
these regulations.”
to comprise 45 to 50 percent
residential loans and 50 to 55
percent commercial loans. There
is a lot of competition for mortgage lending in her market, but
she thinks Centinel Bank has
the edge as consumers gravitate toward relationship-based
lending: “People are looking for
someone they know and respect
to help them select the right
product for them.” On the commercial side, the bank has been
able to work with local businesses to bring new jobs to the
community. For instance, the
bank financed a loan for a local,
family-owned hardware store.
Even with signs of a turnaround in the horizon, Rainey
made the difficult decision to
close one of four branches. The
bank’s 58 employees will remain
on staff, but Rainey determined
that the bank’s Questa branch was
not self-supporting.
“Times have shown us that
we have to be strong and nimble
in order to react to adversity.
Everything we do must positively contribute to the bottom
line,” she says. “We will continue
to serve the Questa community,
albeit without a physical presence, and still ensure the ongoing strength and vitality of the
bank.”
Going for growth
At a time when many businesses
are still scaling back, $840 million-asset Pacific Premier Bank is
looking to expand its operations
through acquisitions of healthy or
failed banks. The bank’s management team, led by CEO Steven
Gardner since 2000, has plans
to increase the bank’s branches
beyond six and add to its 100person staff.
“We expect the Southern
California economy to gradually improve,” Gardner says.
“Even so, there will continue to
be consolidation in our market,
and we’re positioned for growth
The economy here [in
Florida] is improving—
not dramatically, but
things are getting better.
Small businesses are
optimistic about the
future, and they’re
expanding a little and
borrowing to do that.
— R . Va n B o g a n ,
Florida Bank of C ommerce
both organically and through
acquisitions.”
Gardner believes that virtually
all industries in Pacific Premier’s
market will gradually and slowly
improve, with the exception of
the housing market and related
entities. “Improvement is still several quarters, if not several years,
away in these sectors,” he says.
Primarily a business lender,
the community bank sees its best
new prospects as businesses with
$10 million to $50 million in
annual revenue. “We’re doing a
lot of business loans,” Gardner
notes, which range from those
made to small manufacturers
to those financing professional
services. Recent loan customers
include companies from a variety of sectors including aerospace, automotive and service
companies.
While loan demand has been
steady, Gardner sees room for
improvement: “The demand for
commercial loans will increase
gradually at the beginning of this
year and be more robust during
the third and fourth quarters.”
The bank will also continue to
be active in SBA lending as that
business has been very profitable.
As many community bankers
prepare for the worst to come
from regulatory reform, Gardner
sees little point in complaining about the new regulations.
“Banking is the most highly regulated industry, and that’s just
part of doing business,” Gardner
says. “We are focused on our
business and how we can adjust
to take advantage of new opportunities that may result from reg
reform.”
In fact, Gardner says Pacific
Premier is considering whether
to enter mortgage banking: “We
haven’t done a lot of residential
lending, and two years ago we
wouldn’t have touched it. Now, we
think there may be opportunities
for us in that market. We’ve been
growing, and we’ll continue to
grow.”
Apryl Motley, a writer in Columbia,
Md., is a regular IB contributor.
www.icba.org ICBA IndependentBanker 41
Special Advertorial
Executive Profile 2011
What Leading
Executives Think 2011
In the preceding feature, community
bankers offer their thoughts on the key
challenges and opportunities they foresee in
the coming year. ICBA Independent Banker
also thinks it is important to hear from
businesses that consistently serve community
banks.
The companies serving the nation’s
community banks work diligently to
respond to challenges in the industry and
strive to create new products, services and
technologies to meet the needs of community
banks in today’s ever-changing banking
marketplace. These business leaders
continually seek to understand the industry
trends and explore new and more efficient
ways to do business.
Understanding the ways our service
providers are poised to meet the needs of
community banks may help you uncover
new opportunities for growth. With that in
mind, ICBA asked several top executives of
leading community bank service providers to
share their unique insights and perspectives.
Here, learn their thoughts on the state of
the community banking industry, changes
influencing their category of business and
how their companies’ offerings could shape
the way community banks do business in the
Special Advertorial
Executive Profile:
W. Michael Scott
President and CEO
FMSI
What changes in the marketplace will dictate growth in your
■
category of business?
In the past ten years, a 33 percent decrease in teller transactions at
the branch level and a 40 percent increase in salary/benefit hourly
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complements to correspond to the reduction in volume — have
significantly increased banks’ average cost
per teller transaction. As a result,
outsourced workforce optimization
solutions for the branch environment
have become a critical operational need
for community banks.
■ How is your company poised to create
solutions that meet the growing needs of
community banks today?
FMSI’s rapidly deployed outsourced solution allows
community banks to have a sustained and proven
program that directly impacts their bottom line. Our clients
tell our story best, such as Jim Shinn, EVP Director of Retail
Banking at Central Bancompany, who recently stated,
“FMSI’s support has been critical to the success of our teller
optimization initiative, which would have been very difficult to
achieve through our internal resources. Put simply, utilizing
FMSI’s outsourced reporting and automated scheduling was a
big win for us.”
FMSI provides
a monthly teller
productivity ranking
of all the financial
institutions utilizing
our solution.
■ What new products, services or technologies are
your community bank customers most interested in
and why?
FMSI provides a monthly teller productivity ranking of
all the financial institutions utilizing our solution.
Whether a community bank comes in 1st or 101st place
on the list, our clients cherish receiving this very
meaningful business intelligence, because it shows a
direct ongoing comparison to their peers.
■ How does this picture reflect your
personal view of doing business?
Knowing your numbers is as important in
business as clearly seeing the target in
archery.
To learn more:
1720 Windward Concourse #200, Alpharetta, GA 30005, www.fmsi.com, 770-619-3443 (toll free 877-887-3022), [email protected]
photo: Karen Nickel
Special Advertorial
Executive Profile:
Frank D’Angelo
EVP, Payment Solutions
FIS
Just like the unique parts
of a Harley engine make
their motorcycles the most
popular on the market, a
well-oiled payments engine
is crucial for the forward
path of community banks.
To learn more:
601 Riverside Avenue, Jacksonville, FL 32204, www.fisglobal.com
photo: Ryan Ketterman
■ What changes in the marketplace will dictate growth in your category of
business?
It seems like there hasn’t been a time in the financial services industry that has been
marked with more change than we are currently experiencing. Community banks are
some of the most challenged players, with constant pressure to create revenue while
steadfastly serving their community customers.
The biggest challenge facing the industry is how to replace disappearing fee
income. How to do that in a way that is not only reasonable but represents new value
that they can offer customers is critical to success. Although customers have already
experienced some fee structure changes and a new reality for the financial services in
general, they will quickly grow weary of archaic fees reappearing on their statements
without any perceived value.
■ How is your company poised to create solutions that meet the growing needs of
community banks today?
FIS has the most complete and innovative suite of payment solutions. Our solutions are
uniquely customer-centric versus product-centric. Our focus is on enabling transactions to be processed faster, more securely and with exemplary service. We are able
to stand behind this strategy because, unlike other payment processors, FIS has
multi-line strength with leading scale in 10 different payment products including EFT,
prepaid and loyalty programs.
■ What new products, services or technologies are your community bank
customers most interested in and why?
Community banks are most interested in ways to create value for their customers. The
best way to do that is to truly know your customer and understand their needs. Finding
pathways to that knowledge is crucial, and FIS has some of the industry’s leading-edge
products to help facilitate that knowledge share. FIS systems house a wealth of information about banking customers, and our key products, like loyalty, further engage
customers to actively participate in their banking programs.
Reducing expenses is also key to maintaining profit levels and competing in an
erratic market. Strategic to driving down expenses is reducing vendor relationships to
increase buying power by more efficiently pricing services. By partnering with FIS,
community banks gain access to a host of integrated solutions that optimize their
payment engines. A single-source provider model increases the vendor’s accountability while relieving the bank of non-essential back-office work.
■ How would you compare your passion for the payments industry with your
passion for Harleys?
Well, they are both complicated machines to say the least, but ultimately, they have
one common goal and that is to move forward. Just like the unique parts of a Harley
engine make their motorcycles the most popular on the market, a well-oiled payments
engine is crucial for the forward path of community banks.
Executive Profile:
Special Advertorial
John H. Jones
President and CEO
Name: Hed
Data
Center Inc.
Name, Vice President
TK TK TK
Company.
■ Whatofchanges
in the
Number
years in TK:
XX marketplace will dictate growth in your category of business?
Bankers today have to be more focused on regulatory requirements and competitive
service issues, not technology. Our developments in .NET architectures, cloud-based
infrastructures and on-demand services bring more advanced simplicity, value and
security to the bank’s technology investments so they can focus on strengthening their
bank and their customer relationships.
■ How is your company poised to create solutions that meet the growing
needs of community banks today?
We are very agile. As a privately owned company, we collaborate closely with
our bank clients, and can be more personally involved, adaptable and
responsive than a mega-corporation. Our agility places us at the forefront of
technology with time to listen and provide personal attention to each client.
■ What new products, services or technologies are your community
bank customers most interested in and why?
Anything that delivers stability, simplicity, competitive value, and keeps up
with sophisticated customers and the continual evolution of technology. But,
technology isn’t enough. They want a trustworthy partner that protects their
interests and is available at a moment’s notice.
■ How does your community work influence your company mission?
Whatever it is, from painting school playgrounds to helping the disabled or leading
the chamber of commerce, we volunteer and help our communities to improve the
lives of everyone, collectively. That ideal drives our decisions as a company founded
and privately owned by bankers and the personal, community relationship we share.
It’s not profit, acquisitions and stock market prices that matter most. Doing the right
thing and creating lasting, rewarding relationships are what’s important. It’s what
makes our DCI community also grow and thrive.
Whether painting playgrounds,
helping the disabled or assisting
the chamber of commerce,
we help communities to
improve everyone’s lives.
To learn more:
Address.,
20
W. 2nd Avenue,
City, State.,
Hutchinson,
zip, www.,KS
1.000.000.0000,
67501, www.datacenterinc.com,
[email protected]
620-694-6800, [email protected]
photo: brandon chauncey
Special Advertorial
Executive Profile:
Bill Krochalis
President and CEO
Sterling National Corporation
■ What new products,
services or technologies
are your community
bank customers most
interested in and why?
With Sterling National’s
September 2010 acquisition of Seattle Specialty,
we are poised to extend
to independent bankers
our market-responsive
services, processes,
and products while
leveraging the unique
capabilities of Seattle
Specialty to do more to
serve this industry. Sterling Total Escrow Solutions SM was
developed specifically to help mid-market institutions
comply with the new escrow regulations that went in force
in April of 2010. This web-based application makes the
industry’s most comprehensive tax servicing platform
accessible and affordable for the independent banker. Our
suite of Medicare supplement offerings, Medicare MarketPlace ®, is able to enhance what community bankers do
best — build relationships with their customers while offering
customers a uniquely valuable service — all while creating a
new revenue stream.
■ How does this picture reflect the culture at your company?
Our annual charity golf tournament is a 100% employee-led
initiative that began more than seven years ago. This year’s
event, despite a very challenging year for charities, actually
broke all previous records. Essentially, Sterling National is about
people giving their all toward critical goals. I am constantly
amazed at the caliber of people we have here and what they are
able to accomplish. Whether hitting new highs for charitable
giving or finding ways to make business easier for our customers,
the people here really take our corporate motto, KEEPING YOU
FIRST, to heart.
Sterling National is
about people giving their
all toward critical goals.
To learn more:
210 Interstate North Parkway, Suite 400, Atlanta, GA 30339, www.sterlingnationalcorp.com, 800-962-9654
photo: Robin Gaucher
Executive Profile:
Special Advertorial
Mark Young
President and CEO
Mortgage Services III, LLC
We understand
the community
banker and
strive to satisfy
both you and
your customers’
needs.
To learn more:
502 N. Hershey Road, Bloomington, IL 61704, wholesale lending: www.msiloans.biz; correspondent lending: www.msicorr.com, 309-664-9100,
photo: Mark Romine
■ Where are the strongest growth areas for Mortgage Services III, LLC?
With 80% of the country’s mortgage volume being controlled by the “mega banks,”
MSI markets to ICBA-member banks, putting you on the same playing field with rate
and price. We have the ability to make you competitive with the mega banks using our
aggregated volume. We understand the community banker and strive to satisfy both
you and your customers’ needs. I want MSI to be your lender of choice!
■ How is your company poised to create solutions that meet the growing needs of
community banks?
Prompt, friendly and efficient services are the key to the satisfaction of our bank
customers. I have a unique perspective of the community bank’s mortgage needs,
having been a community bank president for 10 years prior to organizing MSI. Our
entire system revolves around ease of use and service. Not only can you track every
stage of the loan through our website, you can actually talk with any of our personnel
at any time. We have you covered from loan registration through closing.
■ What new products, services or technologies are your community bank
customers most interested in and why?
MSI offers a wide range of mortgage loan products including fixed- and adjustablerate loans, FHA, VA, as well as USDA Rural Development. Our technology is
state-of-the-art with a user-friendly website for electronic loan registration and file
delivery. The electronic delivery is fast and efficient, offering a cost savings for
your bank.
■ Can you shed some light on why MSI has become one of the fastest-growing
mortgage lenders?
Our dedicated professionals joined forces with First State Bank, fellow ICBA-member
bank, in early 2007, developing both wholesale and correspondent business channels
with a unique emphasis on servicing community banks. MSI allows true correspondent services of purchasing your closed loans, while providing underwriting, doc
prep and funding services. The choice is yours. I am extremely pleased to announce
that MSI was recently announced as a preferred lender by the ICBA. Having funded in
excess of $3 billion in mortgage loans in both 2009 and 2010, we remain steadfast in
our commitment to excellence.
■ What is MSI’s mission statement?
MSI provides unsurpassed value to our shareholders, employees, and, above all, our
customers, by enriching lives through homeownership financing opportunities. Our
steadfast and unwavering adherence to the highest ethical and moral standards has
set us apart. This is more to illuminate our way forward. Above all, it’s our commitment
to you.
[email protected]
Executive Profile:
Special Advertorial
Lisa Fraga
Vice President and General Manager, Banking
Wolters Kluwer Financial Services
■ What changes in the marketplace will dictate growth in your category of
business?
The Dodd-Frank Act will require that banks have an enterprise view of compliance
and risk across their organization to achieve the transparency and control needed to
make strategic business decisions. They’ll need to be able to mitigate risk yet still
take advantage of business opportunities as the regulatory environment evolves.
Wolters Kluwer Financial Services’ compliance experts not only have monitored the
Act since the legislation’s introduction but have translated it to help banks to ensure
they are kept in compliance.
■ How is your company poised to create solutions that meet the growing
needs of community banks today?
Wolters Kluwer Financial Services is the leading provider of compliance and risk
management solutions to the U.S. banking industry with more than 80 percent
of banks using our documents and compliance workflow solutions. Our
team of experts consists of former bank compliance officers and
regulators, as well as attorneys, compliance analysts and software
developers. By staying closely connected with our customers,
these experts help simplify and automate otherwise complex
operational and compliance processes to help bankers meet
evolving regulatory requirements.
■ What new products, services or technologies are your
community bank customers most interested in and why?
Community banks need solutions that will help them reduce and
simplify regulatory burdens. Wolters Kluwer Financial Services
helps them comply through workflow solutions and services
that enable them to operate more efficiently while growing their
business.
From compliance services to workflow automation, we offer
solutions that can help manage compliance, operational and
financial risk across lending and deposit businesses. Our latest
compliance technology, ComplianceOneTM, is a single documentation solution that makes managing compliance with loan and deposit
account transactions consistent, faster and more efficient. The
solution is built upon the trusted compliance experience of the Wolters
Kluwer Financial Services’ Bankers Systems brand.
Community banks need
solutions that will help
them reduce and simplify
regulatory burdens.
To learn more:
100 S. 5th Street, Suite 100, Minneapolis, MN 55402, www.WoltersKluwerFS.com, 800-397-2341
photo: Matt Blum
Special Advertorial
Executive Profile:
Norman K. Robinson, AAP, CTP
President and CEO
EastPay
■ What’s the hot issue for banks in electronic
payments?
Risk Management. In 2010 NACHA implemented their
Risk Management and Assessment rules to establish a
more comprehensive set of risk management practices
that financial institutions must perform. Tying in
regulatory requirements established by the OCC,
FFIEC, and FDIC, these rules reflect ACH industry
sound business practices to ensure that all financial institutions establish appropriate procedures,
systems, and controls to manage the risks of the
ACH Network.
Take the dive into
electronic payments
with EastPay as
your partner.
■ What advice do you have for
community banks that want to begin
ACH Origination?
Start by contacting your Regional Payments
Association, like EastPay, for risk management, compliance, and marketing guidance.
We can provide a wide variety of support,
including sample agreements and software for
the creation of ACH policies and procedures,
designed to help financial institutions take
advantage of opportunities and avoid the risks.
■ What else should community banks be considering?
Performing periodic assessments to ensure your payments
strategy and tactics are still aligned to your revenue goals.
Swift changes in the payments industry, shifts in market
behavior, and constantly growing competition can
significantly impact the payments strategies you put in
place just a year ago. Don’t forget to ask EastPay about
new network opportunities like same-day ACH and
International ACH.
■ What assistance can EastPay provide to
community banks?
EastPay is a trusted industry leader providing
payments expertise for 35 years. Our goal is to
ensure your successful participation in the growing
business of electronic payments by providing the
highest level of compliance, risk management, and
payments strategy support.
To learn more:
7400 Beaufont Springs Drive, Suite 405, Richmond, VA 23225, www.eastpay.org, 804-644-1642 ext.101, [email protected]
photo: Mike shield
Special Advertorial
Executive Profile:
Norg Sanderson
President and CEO
Name:
StudentHed
Loan Finance Corporation
A founding partner of the iHELP Loan Program
Name, Vice President
Company.
Number of years in TK: XX
TK TK TK
■ What changes in the marketplace will dictate growth in your
category of business?
iHelp student loan products and information services could be
used by 7 million junior and senior high school students throughout the United States. The higher-education credit market
is a growth industry with approximately 22 million
students attending universities throughout the
U.S. — 79% of those students use financial sources
beyond the family contribution.
The highereducation credit
market is a growth
industry with
approximately
22 million
students attending
universities
throughout the U.S.
■ How is your company poised to create
solutions that meet the growing needs of
community banks today?
The iHELP program has capital resources
available from 5,000 ICBA-member banks
and their 12,000 branch offices, strategically
located near colleges and high schools
throughout the U.S.
The iHELP product is low-cost and easy to
understand for the borrowers. For ICBA banks, the
iHELP Loan offers a reasonable ROI, well secured
with co-signers, plus 100% insured against loss
from death, disability or default.
■ What new products, services or technologies are
your community bank customers most interested in
and why?
iHelp is a unique loan product that allows high school
graduates to become first-time credit customers. This is
appealing to community banks because iHelp offers an
exclusive opportunity for banks to start new business
relationships with potential long-term customers.
■ What is an exciting feature of the iHELP loan
program?
iHelp provides students with technology resources
through its “Right Choice” system. This program
provides critical information about credit and
financing higher-ed costs. ICBA banks can use this
system to provide a unique experience connecting
high school students with the right colleges.
To learn more:
Address.,
124
South City,
1st Street,
State.,Aberdeen,
zip, www.,SD
1.000.000.0000,
57401, www.slfc.com,
[email protected]
605-622-4590
photo: joel hardins
Special Advertorial
Executive Profile:
Kevin Moehn
President and CEO
Moehn & Associates
A founding partner of the iHELP Loan Program
■ What changes in the marketplace will dictate growth in your
category of business?
Many lenders have either reduced or discontinued their private
student loan programs. Schools are now welcoming new lenders
on campus to help meet the growing need.
■ How is your company poised to create solutions that meet the
growing needs of community banks today?
The program generates a safe and solid return for ICBA banks while
providing all the loan originations and servicing for the bank.
With the new lending regulations, the ability to have a
10-year ICBA Preferred Service Provider help manage
their student loan portfolio is proving to be of great
comfort to member banks.
Community
banks seem most
interested in our
ability to help them
serve their current
customers and
develop new ones.
■ What new products, services or technologies
are your community bank customers most
interested in and why?
Community banks seem most interested in our
ability to help them serve their current customers
and develop new ones. ICBA banks no longer need
to send their best customers to competitors to
secure these loans.
■ Where are the strongest growth areas for
your company?
Middle-income families that have students
enrolled in higher-cost colleges are the target.
Marketing through the new social media (Facebook and Twitter) has already generated millions
of “hits” to iHELP’s website. Developing a
secondary market will also stimulate growth.
■ What caused you to believe this would
work?
My grandfather, then uncle and now my cousin
own a community bank. Over the years I saw
their commitment to helping their customers
and communities prosper. What better way than
by supporting access to higher education?
To learn more:
Address.,
Box
617, 2961-A
City, State.,
Hunter
zip,
Mill
www.,
Road,
1.000.000.0000,
Oakton, VA 22124,
[email protected]
703-242-3591, [email protected]
photo: adam auel
Special Advertorial
Executive Profile:
Don Hutson
National Industry Partner
BKD, LLP
CPAs & Advisors
■ What changes in the marketplace will dictate growth in
your category of business?
If you look back at the history of banking, we have been through
similar challenges. In recent years, financial institutions have
been inundated with new rules, regulations and industry
changes. The good news is that these uncertain times will
end and the ensuing regulatory environment will
stabilize. At BKD, we believe it’s time to put the past
behind us, come together and move forward.
■ How is your company poised to create solutions
that meet the growing needs of community
banks today?
As one of the 10 largest CPA and advisory firms in
the nation, BKD was built around our audit and tax
practice more than 85 years ago, but firm leaders
recognized the growing need for regulatory compliance, loan review and other consulting services. With all
of the past, present and future changes, we believe
institutions will have needs for expertise in the areas of
regulatory compliance, loan review, valuation
services, and mergers and acquisitions. We
know banks are looking for strategic
advisors to help them successfully
navigate some of the challenges
they are facing. As financial
institutions continue to seek
industry insight and
expertise, BKD professionals have positioned
themselves as thought
leaders who can provide
guidance to our clients so
they don’t face these
obstacles alone. Not only
are our professionals
strategic advisors, we
provide value-added
service through free
webinars, BKD Insights
articles and
FinancialReformInsights.
com, a new Web resource
intended to help banks
around the nation stay
informed about some of
the most important issues
affecting them. We invite
you to experience BKD and
our unmatched client service.
We know banks are
looking for strategic
advisors to help them
successfully navigate
some of the challenges
they are facing.
To learn more:
One Metropolitan Square, 211 North Broadway, Suite 600, St. Louis, MO 63102, www.bkd.com, 800-783-8515, [email protected]
photo: Roger jared
Special Advertorial
Executive Profile:
Gary Teagno
President and CEO
ICBA Services Network
■ What changes in the marketplace will dictate
growth in the ICBA Services Network businesses?
The ICBA Services Network companies reflect the
business of our community banks. Last year ICBA
Securities was strong as banks were flooded with
liquidity. As loan demand picks up, we will look to
ICBA Bancard and ICBA Mortgage for quality
lending solutions and to ICBA Reinsurance to
maximize the fee income on those new loans.
ICBA Capital Markets will see growth as banks
seek to raise capital once again.
As community
banking has
changed, we
have changed.
■ How is the network creating new
solutions?
We launched ICBA Mortgage Solutions, LLC, a
new approach to the mortgage market. For too
long community banks have been hamstrung by
a complicated market. ICBA Mortgage Solutions
offers community banks a streamlined origination and underwriting process that is supported
by multiple mortgage companies, allowing
community banks to choose the product that
best fits their consumer and operation.
■ What do you think is most misunderstood
about the network’s services?
We have been providing services for more than
25 years, and a lot has changed in that time. Today,
in addition to credit cards, ICBA Bancard is a major
provider of debit cards and fraud protection programs.
ICBA Mortgage, in addition to launching ICBA Mortgage
Solutions, offers community banks captive private
mortgage insurance. As community banking has
changed, we have changed.
■ What makes the network different?
The network is wholly owned by ICBA, and each of our
companies has a board of directors composed of
community bankers who are also our customers. That
ensures that our products and programs keep pace with
the fast-changing needs of community banks and
deliver what community banks expect.
To learn more:
1615 L Street NW, Suite 900, Washington, DC 20036, www.icba.org, 800-422-8439, [email protected]
photo: adam auel