Pub. 5 2015-2016 Issue 3

O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G C O L O R A D A N S R E A L I Z E D R E A M S November • December 2015 19 CEDCO Small Business Finance Corporation Your Best Soursce for SBA Real Estate Loans New Easier Qualification Uninterrupted access to money through a monthly SBA-backed bond auction Low fixed-rate financing Low down payments CEDCO Small Business Finance Corporation Colorado’s SBA 504 Loan Expert TM 1175 Osage Street, Suite 110 Denver CO 80204 Denver 303-893-8989 Grand Junction 970-243-1852 www.cedco.org  More stability for your operation  A stronger balance sheet  An asset to sell when you’re ready AS A LEADING SBA 504 LENDER WE MAKE IT EASY FOR YOU  Buy, Build, Remodel or Expand Real Estate  Purchase and install long-lasting equipment  Fast, expert processing - with low loan costs  Refinance may be an option  We lend up to $5 million: borrow up to $20 million when combined with bank financing  Interest rate as low as 5.25%, fixed for 20 years  Down payments range from 10% to 20%  Most small Businesses are Eligible STREAMLINED PROCESSING  Front Range and mid-mountains call Jeff or Mary Jane 303-893-8989  Western Colorado call Pat 970-243-1861 Compliance must come from the top down and be interwoven into the corpo- rate culture of the bank. Compliance is and always has been a key area of banks, but in the past few years it has been under more scrutiny. Bank culture has histori- cally devalued compliance and looked at it as keeping the bank out of trouble. That view overlooks the role compliance can have in increasing value by allowing the bank to look at opportunities that other banks may view as too risky to consider. Compliance should be involved in the bank’s strategic planning to evaluate the risk associated with options the bank is considering during the planning. This is a time that banks can embrace compliance and position itself for growth. Product development, sales and servic- ing are often separate from compliance. However, regulatory compliance should be an integral part of those processes from start to finish. Weaving compliance into the fabric of every area of the bank will enable a bank to spot and resolve compli- ance issues before they become a problem. Compliance should be more than static reporting. Compliance should be a process with clear responsibilities and support throughout every business unit. The bank should have a strategic and an action plan for compliance and answer questions such as: • What does the bank want our compli- ance function to achieve? • What is the mission of the bank’s compliance function? • How can the compliance function enhance and support the bank’s core business? • Is there a way tomake the compliance function more efficient? Not cost savings but time savings to allow the compliance staff to focus on support- ing the bank’s core business units. • Who is responsible for compliance within each business unity? • What is the bank’s tolerance for risk? • Who owns each risk? The bank’s compliance action plan should lead to the development or revi- sion to the enterprise risk management program. Make compliance a proactive part of the bank’s operations rather than just reactionary. Align compliance with the bank’s business priorities to pursue the upside of revenue streams and rec- ognize compliance’s potential impact on enterprise value. An effective compliance program can lead to value creation and preservation to give the bank a competitive advantage and be the differentiator in the marketplace. It can also create a framework within the bank to view compliance from both a risk management and a business perspective. This will help align the bank’s risk man- agement efforts with its overall business priorities to ensure that the proper amount of effort is exerted on compliance risk. The bank should allocate compliance activities and resources according to the importance of each activity to enterprise value. In short, as bankers we must treat this new regulatory environment as an oppor- tunity and meet it head on like we have every other change or obstacle that faces the industry. Otherwise we can take our ball and go home and sell our community banks. I think this is a chance to rethink howwe perform the compliance function, make it more efficient and make the bank stronger and therefore in a much better position to take advantage of opportuni- ties to increase profits and efficiency.  Scott Daugherty is President & General Counsel of Compliance Al- liance. Owned by 24 State Bankers Associations, Compliance Alliance monitors the needs of bankers to create, update and continually pro- vide the most sought-after banking regulation resources in the industry. To learn how to put Compliance Alliance to work for your bank, call (888) 353-3933, visit complianceal- liance.com , or email info@compliancealliance.com .