THE OFFICIAL PUBLICATION OF THE INDIANA BANKERS ASSOCIATION ON A Mission September/October 2025
Baker’s Software Solutions Service Package Includes: Asset/Liability Analysis – Interest Rate Risk Monitor (IRRM®) Your management team will find that The Baker Group’s quarterly review of the loan and deposit information outlined in the Interest Rate Risk Monitor and Asset Liability Analysis is an effective tool in managing your risk and performance. Bond Accounting – Baker Bond Accounting® (BBA) The Baker Group will provide you with accurate, easy-toread reports delivered electronically to you each month. Investment Analysis – Advanced Portfolio Monitor (APM®) The Advanced Portfolio Monitor is a key monthly report that we utilize to help you measure, monitor, and manage the overall risk and performance of your investments. Balance Sheet Liquidity – Dynamic Liquidity Monitor (DLM) The Dynamic Liquidity Monitor allows users to simulate multiple “what if” scenarios to assess impacts on balance sheet liquidity. It is effectively a dynamic “sources and uses” model that enables you to adjust assumptions on a variety of things. *The Baker Group LP is the sole authorized distributor for the products and services developed and provided by The Baker Group Software Solutions, Inc. As financial institutions face unprecedented times, The Baker Group is ready with tools and services to help maximize the performance of your institution. That’s why we’re offering new clients our Software Solutions* service package for a six-month free trial. Not only will you have access to our latest market research and insight from our Financial Strategies Group, you’ll be included in all of our webinars. There you’ll hear the latest Information on the economy and how it could impact your institution and its investment portfolio. www.GoBaker.com Oklahoma City, OK | Austin, TX | Long Island, NY | Salt Lake City, UT | Springfield, IL | Member: FINRA & SIPC To obtain the resources you need to maximize the performance of your financial institution, contact our Financial Strategies Group at 800.937.2257, or FreeTrial@GoBaker.com. Sample Municipal Summary Page 1 of 2 635,461 GO+REV 9,896,680 GO 4,752,978 REV GO 64.7% REV 31.1% GO+REV 4.2% Total: 100.0% Municipal Type 689,324 TX PSF 10,199,393 AA 4,180,764 A 215,638 NR TX PSF 4.5% AA 66.7% A 27.4% NR 1.4% Total: 100.0% Moody/S&P Composite Rating AL CA CO IAIL IN KY NM OH OK TX WA WI AL 1.9% CA 2.3% CO 1.4% IA 3.9% IL 10.8% IN 10.2% KY 2.4% NM 1.7% OH 8.0% OK 9.9% TX 33.2% WA 4.7% WI 9.6% Total: 100.0% State of Issue Individual Municipal Ratings, unless recently purchased. weighting based on Book Value of 15,285,119 Insd-AGM Insd-BAM Insd-PSFG Insd-PSFG, Pre-ReFunded Insd-State Aid Not Insured Not Insured, Pre-ReFunded Insd-AGM 12.0% Insd-BAM 3.4% Insd-PSFG 3.1% Insd-PSFG, Pre-ReFunded 1.4% Insd-State Aid 11.9% Not Insured 58.2% Not Insured, Pre-ReFunded 10.0% Total: 100.0% Insurance Although the information in this report has been obtained from sources believed to be reliable, its accuracy cannot be guaranteed. The Baker Group Software Solutions, Inc. - APMTM FSG / SAMP ADVANCED PORTFOLIO MONITORTM 18 18 Sample Cusip Par Cpn Book Price Market Price Gn/(Ls) *Acctg Eff Dur Eff Cnvx Underlying Municipal Credit Detail Yield Description Page 6 of 7 Muni Insurer Muni Type Moody S&P Call Date Maturity ASC 320 Gn/(Ls)% State Underlying Ratings GO | REV *DA% | DC *Per Cap | Covnt Issue Date Tax Status Overlapping D/A - Debt/Pop Net Asset Ending Beginning Cnty Jobless Security Fiscal Year Report Date *Proj 944431BL8 220,000 5.500 103.90 105.18 2,816 4.34 4.39 (0.98) WAYNE SD #112-B-BABS IL 26 Not Insured N/A N/A GO N/A A+ 12/01/20 12/01/26 AFS 1.23 IL 5.58 | -- 507 | -- 12/08/10 Taxable 8.29 - 754 WAYNE - 8% 2016 Report AD VAL TAXES 2015 4.34 3 Items 4.19 4.19 3.91 (0.30) (458) 103.36 103.40 5.311 1,160,000 Taxable Municipal Totals 39 Items Portfolio Totals 3.25 3.25 3.91 (0.26) 3.392 104.59 101.78 (409,651) 14,615,000 6,385K AA 6,918K A 1,981K NR AA 41.8% A 45.3% NR 13.0% T otal: 100.0% Moody/S&P Composite Underlying Rating 1,471K Aa2 213K Aa3 1,533K A1 768K A3 11,299K N/A Aa2 9.6% Aa3 1.4% A1 10.0% A3 5.0% N/A 73.9% T otal: 100.0% Moody's Underlying Rating 695K A+ 635K A 232K A13,723K N/A A+ 4.5% A 4.2% A- 1.5% N/A 89.8% T otal: 100.0% S&P Underlying Rating 689K AAA 10,415K AA 4,181K A AAA 4.5% AA 68.1% A 27.4% T otal: 100.0% Moody/S&P Composite Rating weighting based on Book Value of 15,285,118 * Denotes Tax Equivalent Yield (TEY) where applicable. Individual Municipal Ratings, unless recently purchased. * D/A% = Debt to Assesed Ratio; DC = Debt Coverage | Per Cap = Per Captia Debt; Covnt = Rate Covenant Although the information in this report has been obtained from sources believed to be reliable, its accuracy cannot be guaranteed. The Baker Group Software Solutions, Inc. - APMTM FSG / SAMP ADVANCED PORTFOLIO MONITORTM 26 26 Balances ($000's) Page 1 of 1 Book Value % of Book TA **Rate Sensitive < 1 Year *Book Yield/ Rate *Reinv. Rate *12 Mo. Proj. Yield/Rate Avg. Life Effective Duration Effective Convexity Full Indx. Rate / Total is % of Segment Fixed Var. Non Int. Summary ALCO - Asset/Liability Mix Sample $20,414 4.16 46.55 53.45 46.55 0.97 0.04 0.01 0.00 Cash & Due 0.97 0.97 / 0.97 $172,210 35.10 100.65 (0.65) 14.56 2.81 4.60 3.55 (0.51) Investments j 2.81 2.64 / 0.00 (Includes MTM) $4,500 0.92 100.00 100.00 1.63 0.04 0.04 0.00 Funds Sold 2.13 2.13 / 2.13 $276,700 56.39 56.28 45.26 (1.53) 53.28 5.20 2.59 1.96 (0.22) Loans 5.37 5.47 / 5.76 $6,511 1.33 100.00 2.49 12.63 0.00 0.00 Other Earning 2.49 2.49 / 0.00 $10,358 2.11 100.00 Non-Earning $490,693 3.24 Total 68.38 28.37 100.00 38.01 4.17 3.27 2.36 (0.31) Assets 4.28 4.28 / 5.31 $276,064 56.26 66.70 33.30 12.02 0.53 7.66 4.48 0.54 Non-Maturing Deposits 0.53 0.53 / 0.53 $92,498 18.85 99.44 0.56 0.00 82.54 0.84 0.70 0.65 (0.04) Certificates of Deposit 0.84 0.81 / 0.70 $37,721 7.69 100.00 68.68 1.09 0.97 0.93 (0.02) Jumbo CDs 1.08 1.05 / 0.00 $28,250 5.76 95.58 4.42 46.90 2.06 1.95 1.89 0.03 Borrowed Funds 2.04 1.86 / 1.88 Other Paying $6,724 1.37 100.00 Non-Paying $441,257 22.36 Total 35.51 42.13 89.93 33.70 0.80 5.15 3.14 0.33 Liabilities 0.80 0.77 / 0.54 10.07 $49,436 (0.60) (0.46) Total Equity Capital 100.00 $490,693 Total Liab & Capital Liability Mix Asset Mix Liquidity Ratios Constant Benchmark ALCO Dependency Ratio Liquid Assets / TA Ratio is outside benchmark. P < 750.00% < 100.00% < 50.00% < 20.00% > 10.00% < 35.00% < 300.00% 42.39 68.11 559.71 48.04 6.31 10.19 7.69 Loans / Assets 56.39 Investments / Deposits Loans / Deposits Loans / Capital Net Borrowed Funds / Capital < 75.00% Available Line of Credit $90,500 56.39 Loan 35.10 Inv 4.16 Cash 2.11 Non-Earn 1.33 Other Earn 0.92 Others 56.26 NMD 18.85 CDs 10.07 Equity 7.69 J CDs 5.76 Borrow 1.37 Others Reliance on Wholesale Funding 9.14 < 30.00% The smallest 2% of all categories will be grouped into an 'Others' category. Jumbo CDs / TA Note: Values are rounded before printing, but full precision values are used in all calculations. * Yields/Rates are reported on EA & PL. Investments using Accounting yield. j (Ver 4.0 R7) Copyrighted SAMPLE / SMB1218 The Baker Group Software Solutions, Inc. - IRRMTM Although the information in this report has been obtained from sources believed to be reliable, its accuracy cannot be guaranteed. Interest Rate Risk Monitor ** Percentages based on maturing, repricing, and paydown balances. Six-Month FREE TRIAL
DIRECTORS, STAFF AND CREDITS IBA BOARD OF DIRECTORS OFFICERS Matthew W. Howrey, Chair............................. North Salem State Bank David M. Findlay, FirstViceChair.......................... Lake City Bank, Warsaw Lisa Arnold, SecondViceChair........................... Home Bank, Martinsville Benjamin J. Bochnowski, ImmediatePastChair. . . . . . . . . . . . . . . . Peoples Bank, Munster Amber R. Van Til, PresidentandCEO.................... Indiana Bankers Association CONSTITUENT DIRECTORS Garry D. Kleer, ABAMembershipCouncil....................... First Bank Richmond Kent A. Liechty, ICBAStateDirector........................... First Bank of Berne Amanda Morris-Feldman, IBA FLD President . . . . . . . . First Federal Savings Bank, Rochester Karen B. Woods, Non-Indiana Headquartered Banks . . . . . . . . First Financial Bank, Cincinnati REGIONAL AND AT-LARGE DIRECTORS Mark “Doc” Holt, At-Large.................... First Farmers Bank & Trust Co., Converse Nicole S. Lorch, At-Large.............................. First Internet Bank, Fishers J. Daniel Maddox, NorthRegion..................... Citizens State Bank, New Castle Bradley J. Monts, NorthRegion. . . . . . . . . . . . Hoosier Heartland State Bank, Crawfordsville Jacqueline M. Ruge-Perkins, NorthRegion.................. First State Bank of Porter Mark E. Bruin, SouthRegion...................... The National Bank of Indianapolis David A. Coffey, SouthRegion....................... Mutual Savings Bank, Franklin Eric J. Lane, SouthRegion.................. First Federal Savings Bank of Washington IBA FUTURE LEADERSHIP DIVISION ADVISORY BOARD Amanda Morris-Feldman, President .. .. .. .. ...... First Federal Savings Bank, Rochester Greg Barnes Jr., Vice President ........................... STARBank,FortWayne Ryan Anderson .. .. .. .. .. .. .. .. ........... The Fountain Trust Company, Covington Jenilee Bransteter .. .. .. .. .. .. .. .. .. .. .. .. ............... First Bank of Berne Jordan Briggeman . . . . . . . . . . . . . . . . . . . . . Springs Valley Bank & Trust Company, Jasper Ashley Burns .................................. FirstNationalBank,Cloverdale Michael J. Clampitt ...................................NorthSalemStateBank Brandi Dunn .. .. .. .. .. .. .. .. .. .. .. .............. The Farmers Bank, Frankfort Larissa Fox .................................... OldNationalBank,Evansville Kyle Goodwin .. .. .. .. .. .. .. .. .. .. .. .. .. ............... DeMotte State Bank Christopher Griffith .. .. .. .. .. .. .. .. .. .. ............ First Harrison Bank, Corydon Zach Hockersmith . . . . . . . . . . . . . . . . . . . . . Hoosier Heartland State Bank, Crawfordsville Casey Johnson .. .. .. .. .. .. .. .. .. .. .. .. ............. Home Bank, Martinsville Laura Shake .. .. .. .. .. .. .. .. .. .. ............. The National Bank of Indianapolis Casey Shireman ........................................NWSB,Charlestown Vanessa Spicer .. .. .. .. .. .. .. .. ......... Community First Bank of Indiana, Kokomo IBA STAFF Amber R. Van Til ........................................ PresidentandCEO Rod Lasley ......................................... ChiefOperatingOfficer Dax Denton ............................................ChiefPolicyOfficer Christina M. Bennett, CMP . . . . . . . . . . . . . . . . . . . . . . VicePresident–Meetings&Events Evan Hoffmeyer, CAE .. . . . . . . . . . . . . . . . . . . . . . . . . . VicePresident–Communications Josh Myers .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .VicePresident–MemberEngagement Laurie A. Rees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . VicePresident–Education&Training Emily Brooks ........................................DigitalMediaManager Maria L. Dowers . . . . . . . . . . . . . . . . . . . . . . Executive & Government Relations Coordinator Molly Gibbs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Events&Products/ServicesAssistant Elizabeth DeHaven ......................................EducationManager Katie Yates ....................................EducationMeetingCoordinator Timothy Fry .............................................StaffAccountant Tracy Kubly .......................................... TechnologyManager Silvia Regalado ......................................AdministrativeAssistant FINANCIAL SERVICES ACADEMY Chris Fisher, M.Ed. ....................................... PresidentandCEO Sara Holmes, M.Ed. ..............................Curriculum&PathwayManager OUR ASPIRATION The Indiana Bankers Association strives to grow stronger banks and stronger communities. OUR VALUES In fulfilling our mission, we will: • maintain the highest ethics, integrity and respect for others; • provide service with professionalism, innovation and resourcefulness; • instill passion, a positive attitude and enthusiasm; and • remain mindful that the success of the IBA is judged by the success of its members. indiana.bank Vol. 109 No. 5 INDIANA BANKERS ASSOCIATION 8425 Woodfield Crossing Blvd., Suite 155E Indianapolis, IN 46240-7321 PUBLISHER Amber R. Van Til EDITOR Evan Hoffmeyer, CAE ADVERTISING Josh Myers DESIGN The newsLINK Group SUBMISSIONS HB@indiana.bank ADVERTISING Media kits are available at indiana.bank. Advertising is reserved for members and associate members of the Indiana Bankers Association. DEADLINES Editorial and ad reservations are due the 20th of the month, two months before publication. SUBSCRIPTIONS Subscriptions are provided free of charge to members and associate members of the Indiana Bankers Association. ABOUT The flagship publication of the Indiana Bankers Association, Hoosier Banker is distributed to all banks and thrifts headquartered in Indiana, IBA-member banks headquartered out-of-state and IBA associate members. PUBLICATION DISCLAIMER Hoosier Banker (ISSN 0018 473X) is published bimonthly by the IBA Service Corp., a subsidiary of IBA Holding Company Inc., which is a wholly owned subsidiary of the Indiana Bankers Association. Material published in Hoosier Banker and on the IBA website is the property of the IBA. All rights reserved. CONTACT IBA Email IBA staff using first name initial and last name, plus “@indiana.bank” – example: JDoe@indiana.bank. September/October 2025 3
24 Latina Masters Banking Center Manager – Citizens State Bank, New Castle 16 What’s Next for the Fed? By Dillon Wiedemann, The Baker Group 56 CRA: Not Just Letters, but Truly Focused on Communities By Rod Lasley, Indiana Bankers Association 10 ON A Mission 4 HOOSIERBANKER IN THIS ISSUE
Features 6 Vantage Viewpoint By Amber R. Van Til, Indiana Bankers Association 7 Chairman’s Report By Matthew W. Howrey, Indiana Bankers Association 8 2025 IBA Education Calendar COVER STORY 10 On a Mission By Evan Hoffmeyer, Indiana Bankers Association 20 Conversations Must Determine Our Innovation Budgets By Rebeca Romero Rainey, Independent Community Bankers of America 22 Shaping the Future of Stablecoins By Rob Nichols, American Bankers Association 40 Jim Cousins, Former IBA President, Passes Away 45 10 Complete IBA Commercial Lending School 46 State Deposits in Indiana Financial Institutions Jan. 1 – June 30, 2025 63 Cindy Konich Retires from FHLBI, Brendan McGrath Named Successor 65 Summer Banking Interns 66 Partnership Financing Lending a Helping Hand Articles DIRECTORS & SENIOR MANAGEMENT 16 What’s Next for the Fed? By Dillon Wiedemann, The Baker Group COMPLIANCE CONNECTION 18 Deposit Account Control Agreements What Are They, and Are They Safe To Sign? By Keaton J. Miller, Krieg DeVault LLP BANKER PROFILE 24 Latina Masters Banking Center Manager – Citizens State Bank, New Castle GR SUMMIT 36 Stablecoins: What They Are and How They Could Affect the Banking Industry By Dax Denton & Ross Teare, Indiana Bankers Association HUMAN RESOURCES 38 The Growth of AI in Hiring Is It Actually Intelligent? By Joey K. Wright, Amundsen Davis LLC FLD FOCUS 42 FLD Conference Joins with Banking Interns for Memorable Event By Josh Myers, Indiana Bankers Association SALES & MARKETING 50 The Keys to Sustainable Growth Hyper-Personalization, Relevance & ROI By Bruce Clapp & Brent Walker, MarketMatch PRODUCTS & SERVICES PROFILE 56 CRA: Not Just Letters, but Truly Focused on Communities By Rod Lasley, Indiana Bankers Association Departments 6 Don’t Miss Out! 7 Digital Extras 17 Anniversary Milestones 19 IBA ‘High Five’ Awards 23 In Memory Of … 26 Bankers on the Move 48 Banking on Community 49 Associate Members’ Corner 58 Banking Center News 59 Mergers & Acquisitions 60 From the Board Room 62 Honorable Mentions 65 Advertiser Index 36 September/October 2025 5 INTERACT WITH IBA
A didn’t conflict with summer travel, so we are continuing that timing this year with dates ranging from Nov. 3-17. As we wrap up the year, be sure to join us at the Renaissance Indianapolis North in Carmel on Dec. 12 for the annual Indiana Economic Outlook Luncheon. The IBA Board will meet soon to lay out a strategic plan to guide the Association through the next three years. We already have a lot of big ideas in the pipeline that I can’t wait to share with you. If you have any questions about our most recent strategic plan or comments to offer as we prepare our next strategic initiative, feel free to reach out to me or any member of our Board. As we head into Q4, be sure to reach out to the Association with anything we can do to help you finish out the year strong and set you up for success in 2026. As always, it is a pleasure to serve each of our members. DON’T MISS OUT! 1 Banking on Women Conference Oct. 22-23 Women in banking gather to unlock their potential and own the future. 2 Ag Clinic Dec. 4 For more than 50 years, the IBA Ag Clinic has served as one of the largest agricultural banking conferences in the country. 3 Indiana Economic Outlook Luncheon Dec. 12 Learn what to expect in the state’s economic landscape for 2026. Vantage VIEWPOINT BY AMBER R. VAN TIL, INDIANA BANKERS ASSOCIATION After a wonderful – and all too short – summer, school is back in session. As students head back to class, the IBA is also gearing back up for its busy fall schedule. There are dozens of opportunities to grow with your fellow bankers through professional development, networking and more over the next few months as we wrap up 2025, including in-person seminars and virtual opportunities. Check out the educational calendar on page 8 to see what will best help you grow in your career path. At the IBA’s Annual Convention, four bankers were inducted into the distinguished circle of Leaders in Banking Excellence. All four will be profiled in the November/December issue. We also welcomed more than 110 of our industry’s emerging leaders at the FLD Leadership Conference on July 9-10. Our Banking on Women conference continues at its new venue, but a little earlier than normal, on Oct. 22-23 at Embassy Suites Noblesville. This conference has sold out in the past, so be sure to get registered today! I also can’t wait to hit the road and see all of you at this year’s slate of Regional Meetings. This offering moved to November last year and worked well for many of our members as the later schedule Amber R. Van Til President and CEO Indiana Bankers Association AVanTil@indiana.bank 2025 IBA Chairman Matthew W. Howrey, president & CEO of North Salem State Bank, passed the gavel to 2026 IBA Chairman David M. Findlay, chairman & CEO of Lake City Bank, Warsaw, during the Association's Annual Convention on Sunday, Sept. 7, 2025, in French Lick, Ind. 6 HOOSIERBANKER
DIGITAL EXTRAS Use the QR code to read every article in this issue, plus these digital-only stories! 1 Study: Fraud Trending Down, Stakes Remain High A new report shows fewer people experiencing fraud this year, but the anxiety around it has grown. 2 HSA Reporting Two common situations where “no reporting” is actually the right reporting method. 3 Finish Strong With just a few months left in 2025, is your bank where you expected it to be? Check these seven goals many community institutions are working toward. O Matthew W. Howrey Chairman Indiana Bankers Association President and CEO North Salem State Bank Matt has served as president and CEO of North Salem State Bank and its holding company, North Salem State Bancorporation, since 2010. Prior to joining the bank in 2008 as chief financial officer, he served as a bank examiner for the Indiana Department of Financial Institutions, reaching the level of senior financial examiner. Chairman’s REPORT BY MATTHEW W. HOWREY, INDIANA BANKERS ASSOCIATION One of the most important things we do as an Association is invest in the next generation of banking talent. We continue to see success stories in this area, including record attendance at this year’s FLD Leadership Conference in July. Nearly 110 emerging leaders were joined by almost 120 college interns, who came on the first day for a mix of joint and separate sessions and networking opportunities. This was the first year for the interns to have a full conference after their networking lunch outgrew the IBA’s office. Read more about this remarkably successful joint event on page 42 of this issue. The IBA is leading the state with our new high school apprenticeship program, the Financial Services Academy. We have hired two full-time staff members to spearhead FSA. Chris Fisher serves as president & CEO of the program, and Sara Holmes is curriculum & pathway manager. This is part of a broader initiative envisioned and funded by the Richard M. Fairbanks Foundation to establish similar apprenticeship programs across several industries where Indiana employers face a shortage of skilled workers. Recognizing the skill of the FSA team and the support of IBA-member banks, Chris and Sara have been asked to share their knowledge with those other industry programs to help them get off the ground as well. So far, two dozen bank members are committed to hosting a combined 50 apprentices in the inaugural class starting next August. We believe these apprentices are vital for the future of community banking, which is why my own bank has committed to hosting three, and I am personally serving on the FSA’s governance committee beyond my time as your chairman. This could easily be the greatest move our Association has taken in its more than 125 years of existence to secure the next generation of our workforce. I would like to personally challenge every IBA-member bank to be part of that step forward and host an apprentice next year. September/October 2025 7
2025 IBA EDUCATION CALENDAR EDUCATION CALENDAR See all education opportunities at indiana.bank/calendar. OCTOBER Chief Operations Officer Forum Oct. 10: IBA Center Essentials of Banking – Part 4 Oct. 16: Virtual Banking on Women Conference Oct. 22-23: Embassy Suites, Noblesville Outside Calling School – Part 2 Oct. 23: Virtual Marketing Directors Forum Oct. 28: IBA Center Information/Cybersecurity/IT/ Operations Officer Forum – Group 1 Oct. 29: IBA Center Information/Cybersecurity/IT/ Operations Officer Forum – Group 2 Oct. 30: IBA Center NOVEMBER IBA Regional Meeting – Fair Oaks Nov. 3: Farmhouse Restaurant IBA Regional Meeting – Fort Wayne Nov. 4: Biaggi’s Ristorante Italiano Human Resources Director Forum Nov. 4: IBA Center Essentials of Banking – Part 5: Banking Compliance Overview Nov. 6: Virtual IBA Regional Meeting – Evansville Nov. 10: Biaggi’s Ristorante Italiano IBA Regional Meeting – Jeffersonville Nov. 12: Upland Brewery Retail Management Series – Part 4: Raising the Bar for Sustainable Growth Nov. 12: IBA Center Commercial Loan Underwriting Workshop Nov. 13-14: IBA Center Chief Financial Officer Forum – Group 1 Nov. 13: IBA Center Chief Financial Officer Forum – Group 2 Nov. 14: IBA Center IBA Regional Meeting – Indianapolis Nov. 17: Columbia Club Community Bankers for Compliance Nov. 18: IBA Center & Virtual Supervisor Bootcamp Nov. 18-19: IBA Center Fraud Forum Nov. 19: IBA Center Risk Management Officer Forum Nov. 20: IBA Center Professional Development/ Education/Trainer Forum Nov. 21: IBA Center DECEMBER Treasury Management Forum Dec. 2: IBA Center *NEW* Chief Credit Officer Forum Dec. 3: IBA Center Ag Clinic Dec. 4: Purdue University, West Lafayette Internal Bank Audit School Dec. 9-10: IBA Center Advanced Commercial Lending School Dec. 9-10: IBA Center Loan Operations Manager Forum Dec. 11: IBA Center Essentials of Banking – Part 6 Dec. 11: Virtual Economic Outlook Luncheon Dec. 12: Renaissance Indianapolis North Hotel, Carmel 8 HOOSIERBANKER
The Indiana Bankers Association honored four members of the Indiana banking community with the 2025 IBA Leaders in Banking Excellence awards, presented at a special ceremony at the IBA Annual Convention in September. This award celebrates exceptional Indiana banking leaders who have positively impacted banks and the communities they serve. Details about the awards ceremony are forthcoming in a future edition of Hoosier Banker. Indiana dignitaries from both the private and public sectors spoke in honor of this year's inductees, who were each invited to offer their own comments in reflection on their career and the industry. One honoree is deceased and was represented by family members. The event culminated with the viewing of a traveling replica of the IBA Wall of Excellence, which showcases each honoree since the honor's inception in 2018. Wall plaques for each honoree are to remain on permanent display at the IBA office, and each honoree/representative was given a separate plaque as a keepsake. The 2025 Leaders in Banking Excellence represent a range of leaders in banking. All were nominated by IBA-member organizations and approved by the IBA Board of Directors. For more information about the awards, please contact Rod Lasley at 317-387-9380 or RLasley@indiana.bank. IBA Honors 2025 Class of Leaders in Banking Excellence Congratulations to the 2025 Class of IBA Leaders in Banking Excellence! Thomas W. Dinwiddie Dinsmore & Shohl LLP Indianapolis Donald E. Goetz DeMotte State Bank DeMotte Christopher J. Murphy III 1st Source Bank South Bend Karen I. Miller The Farmers Bank Frankfort
I ON A MISSION BY EVAN HOFFMEYER, INDIANA BANKERS ASSOCIATION Indiana will soon have its first de novo bank in nearly 20 years.1 Generations Community Bank received regulatory approval from both state and federal agencies this summer, pending completion of the bank’s capital raise. Leaders hope to finish that in time to open their doors by the end of the year, by the first quarter of 2026 at the latest. De novo approvals have plummeted since the financial crisis of 2008-10, as seen in the chart below. However, there is an expectation among some analysts that we may finally start to see more de novo activity under the current regulatory environment. source: ABA analysis of FDIC data COVER STORY Number of De Novo Banks 10 HOOSIERBANKER
Minority Depository Institution Generations represents a second landmark for the state as it is also on track to be Indiana’s first Minority Depository Institution bank. MDIs are an official classification by the Federal Deposit Insurance Corporation2 for federally insured depository institutions that either (1) have 51% or more of its voting stock owned by minority individuals or (2) have a board of directors that is majority minority and serves a community that is predominantly minority.3 While there are not currently any MDI banks in Indiana, there were 152 across the country holding a combined $371 billion in assets as of March 31, 2025, including 10 in the FDIC’s Chicago region, which governs Indiana. 5 0 0 2 1 2 source: IBA analysis of FDIC data Longer-term trends among MDIs reflect the broader industry in terms of merger and acquisition activity and a lack of de novos, but since the pandemic, MDIs have been on a steady pace of growth from the number of institutions and branches to overall assets and deposits. A recent report from the National Bankers Association4 found that MDI assets grew 90% from 2014 to 2024, and 43% since the 2019/pre-pandemic era.5 MDIs are also expanding geographically, jumping from 32 states and territories in 2022-23 to 43 by year-end 2024. source: IBA analysis of FDIC data source: ABA analysis of FDIC data September/October 2025 11
Mission-Driven Institution Generations’ primary source of initial funding came from Old National Bank, Evansville. Old National said that its primary regulator, the Office of the Comptroller of the Currency, approached CEO Jim Ryan several years ago and informally asked if his team could provide guidance to struggling MDIs. He asked the bank’s CEO Council, a group of emerging leaders within the institution,6 to research the topic and come back with ideas. When they discovered Indiana didn’t have any, they recommended that instead of helping out-of-state organizations, Old National should help start a new one in Indiana. “Along with its recommendation, the CEO Council created a high-level business plan for the MDI” that would become Generations Community Bank, according to Al London. London currently serves as senior vice president, community impact director for Old National, but will become Generations’ CEO when it completes its initial capital raise. “While ONB is proud to have several programs and initiatives in place to serve underserved populations, it recognizes that an even greater impact can be made by helping launch an MDI in our home state.” The FDIC has stated that a bank’s investment in MDIs will receive favorable CRA consideration even if the MDI is not serving the assessment area of the investing institution. “ Mission-driven banks play a crucial role in the communities they serve. The NBA report found communities with an MDI present have better credit health as measured by factors like credit score, total credit available and credit utilization rates, relative to demographically similar communities that do not have an MDI present. An American Bankers Association analysis of Small Business Administration 7(a) lending data found MDIs originated roughly 2,500 SBA loans in 2024, totaling $2.2 billion – a 250% increase from pre-COVID figures in 2019.7 Generations’ mission is to speak the language of its community and similarly fill the gaps in access to quality financial products and services through the bank’s core values of collaboration, communication, innovation and discipline. “It is important to note that MDIs were created in the first place because the traditional banking system is generally not equipped to address these issues as effectively as mission-driven banks,” said Rafael Sanchez, Old National Bank’s executive vice president, chief impact officer and Indianapolis Market president. “Old National intends to partner with Generations Community Bank to help drive even more impact to Hoosiers in central Indiana.” Personal Mission It was that dedication to the mission that led London to leave a successful, stable position with a national bank and take the leap to build something from scratch. “I was at a point in my career where I had begun to ask myself, ‘What do I want my career legacy to be?’ and ‘How will I be able to identify how I made a difference in the community that I call home?’” he said. “The mission is part of the DNA of GCB COVER STORY CONT. 12 HOOSIERBANKER
September/October 2025 13
versus being a department of the bank. My mother taught me and my siblings the importance/power of helping your fellow neighbor. The opportunity to lead Generations Community Bank allows me to honor that teaching while making an economic difference in Indiana.” London and his team aim to address the wealth gap in central Indiana that, according to GCB’s research, currently shows white families holding on average 7.8 times the net wealth of a Black family and 30% more homeownership than Black individuals, 27% more than Latin Americans and 15% more than Asian Americans. “Generations Community Bank’s service model aims to provide the resources, education and financial support to create more business owners and homeowners from underserved communities, and assist them in creating generational wealth,” he said. Despite the bank’s emphasis on underserved populations, London emphasized that “this bank will serve the ENTIRE community. It is not a Black bank or a Latino bank or an Asian bank. It will be a very inclusive, mission-driven bank that will aim to create economic mobility for all Hoosiers and will pay close attention to and focus on those communities that have been overlooked and underserved.” “In this sense, the bank will be focused on equality of opportunity, not equality of results,” Sanchez added. “We are proud to have the support of Gov. Mike Braun and our state and federal regulators.” Generations Community Bank leadership team (front row, from left) Kyle Middleton, chief credit officer; Rafael Sanchez, lead organizer, director (will remain on staff at ONB); David Bratton, chief financial officer & chief operating officer; (back row, from left) Brittany Hall, VP-operations; Al London, president & CEO; and Michelle Carrera, chief compliance & risk officer COVER STORY CONT. 14 HOOSIERBANKER
“I want to express my heartfelt appreciation for Jim Ryan, Rafael Sanchez, Roland Shelton, the ONB family and the Generations Community Bank Board of Directors for their unwavering support,” London added. “We truly appreciate the support we have received from other Indiana community banks who made the decision to join us on this historic journey.” De Novo The time from those initial discussions with Old National’s CEO Council to GCB’s anticipated opening will be roughly the 2.5 years it takes the average MDI to get off the ground. It was delayed by the change in presidential administration, but the Indiana Department of Financial Institutions approved the bank’s charter application on July 10, and the FDIC followed suit on Aug. 21. The final piece is to complete the bank’s initial capital raise. While Old National provided the first significant round of funding and GCB’s top executives are currently on the bank’s payroll, it will not own GCB. London could not disclose the names of additional investors but said they do have many well-known community and business leaders in the bank’s ownership group with the intention of Old National not holding more than 4.99% of Generations’ voting shares moving forward. Evan Hoffmeyer Vice President – Communications Indiana Bankers Association EHoffmeyer@indiana.bank Evan is responsible for all the IBA’s print and digital communications. He earned a bachelor’s degree from the University of the Ozarks, a master’s degree from Ball State University, the Certified Association Executive designation from the American Society of Association Executives and graduated from the IBA Leadership Development Program. Without naming specific institutions, Sanchez confirmed several community banks have signed up as investors with more expressing an interest and running through their approval processes. Assuming it is approved for MDI status, investment can count toward a bank’s Community Reinvestment Act rating even if the community the MDI serves is not in the investing bank’s assessment area. “We are excited that we have already obtained commitments from other local banks, as we think this is a great opportunity for many banks to collaborate and partner together for the betterment of our community,” London said. 1 The last Indiana de novo, according to an ABA analysis of FDIC data, was in 2008 when First Security Bank of Owensboro (KY) Inc. created Warrick Interim Bank as an intermediary as part of its acquisition of Warrick Loan and Savings Association, Boonville. (The combined institution was acquired by German American Bank, Jasper, in 2018.) Prior to that was Evansville Commerce Bank in 2006, which was acquired by Indiana Members Credit Union in 2020. 2 “Minority Depository Institutions Program: FDIC Definition of Minority Depository Institution.” Federal Deposit Insurance Corporation. https://bit.ly/FDIC-MDI 3 Owners must be U.S. citizens or permanent legal U.S. residents to be counted in determining minority ownership. Qualifying minority populations include Asian or Pacific Islander, Native American or Alaskan Native American, Hispanic American, Black or African American, and Multi-racial. Women-owned or -managed institutions were not included in the statutory definition. 4 The National Bankers Association is a trade association representing MDIs and “mission-driven banks that serve underserved and low- to moderate-income communities.” https://www.nationalbankers.org/about-us 5 “The State of MDIs 2024.” National Bankers Association. https://bit.ly/NBA-MDI2024 6 Old National Bank’s CEO Council is a 12-month program that invites roughly a dozen mid-level employees to make an impact on the organization through tackling unique business opportunities that may normally be considered above their position, all under the direct guidance of bank c-suite executives, including CEO Jim Ryan. This gives them a chance to gain and demonstrate executive‑level skills, accelerating their career advancement and allowing the bank to cultivate its next generation of senior-level talent. https://bit.ly/CEOcouncil_23-24 7 “At the Intersection of Opportunity and Need.” Dan Brown, Chris Lewis & Avery Weisel. American Bankers Association. https://bit.ly/ABA-MDI September/October 2025 15
T What’s Next FOR THE FED? BY DILLON WIEDEMANN, THE BAKER GROUP The Fed last cut rates in December, capping off a 100bp reduction in the Fed Funds Target rate during 2024. No adjustments have been made through the first six months of the year, as the Fed has maintained a steadfast “wait and see” approach. Tariffs and geopolitical concerns have muddied the waters and created debate around whether—and by how much—these obstacles could increase inflation. Will the added import costs from tariffs be passed on to consumers and, if so, how much could that increase CPI and PCE? If war breaks out between Israel and Iran, will the price of oil increase, thus raising headline inflation rates? These are two additional puzzle pieces that the Fed is working to navigate within its broader mandate of Maximum Employment and Long-Term Price Stability. Following the Fed’s most recent meeting, we received two critical pieces of information that can help us evaluate the Fed’s current thinking as compared to the first quarter: 1. The Dot Plot 2. The Summary of Economic Projections The Dot Plot shows the future rate expectations for each member of the Fed. Both voting and non-voting members provide their expectations anonymously, so it can be difficult to discern where each member stands; however, in aggregate, you can get an idea of what the group is thinking. If we compare the Dot Plot for Q1 vs. Q2, we notice a couple of things. The first is that the Fed is still expecting two 25bp rate cuts for the remainder of 2025. The second is that the Fed anticipates it will have to move more slowly on the path to its longer run neutral rate of 3%. The Summary of Economic Projections is interesting because it provides insight into the Fed’s expectations for the data that impact its monetary policy—specifically, expectations for GDP, the Unemployment Rate, and PCE (the Fed’s preferred measure of inflation). The glaring takeaway from Q2 compared to Q1 is that the Fed expects slower growth combined with an uptick in unemployment and inflation. This combination points to a more challenging environment for the Fed to navigate in order to achieve its goal of a soft landing. Looking past expectations, real data has shown cracks as well. Q1 GDP came in negative for the first time since early 2022. Much has been made of the drag that Net Exports (Exports minus Imports) had on GDP, as many businesses boosted imports in the first quarter to avoid paying tariffs, but there was also a noticeable decline in consumer activity. Q2 GDP may well bounce back, but given that roughly 70% of our economy is driven by consumer spending, a continued slowdown of the consumer could have a massive impact on the economy. Considering the entire backdrop of current data as well as the Fed’s own expectations, we can see the challenge they’re up against. The Fed expects to cut rates twice through the remainder of 2025. The market is currently betting that the Fed cuts rates closer to three times, with the first cut coming in September. It feels like sentiment for a rate cut is starting to grow, as two voting members have come out publicly saying that they see a case for a July rate cut. The Fed has been very careful to project any movements they’ve made since they began the easing cycle and, so far, they’ve been pretty consistent with hitting their short-term targets. If the data continues to remain stable and we don’t see any large upticks in the Unemployment Rate or Inflation, it makes sense to defer to the Fed’s near-term guidance of two rate cuts, as they have so far been fairly consistent in following their projections. If we do see two additional rate cuts this year, what could that mean for our balance sheets? Given the strong competition that much of the industry is facing for deposits, it could present a challenge. On one hand, institutions should be able to continue reducing cost of funds under cover of rate cuts from the Fed, but the magnitude of the savings on interest expense remains to be seen. If an institution is currently paying below-market rates on core deposits, that is going to limit the flexibility they have to cut costs—especially in more competitive DIRECTORS & SENIOR MANAGEMENT 16 HOOSIERBANKER
ANNIVERSARY MILESTONES Mike Head celebrated 45 years with First Federal Savings Bank, Evansville, in July. He first joined the bank in 1980 after graduating from the University of Southern Indiana, serving in a variety of capacities before being named president in 2000 and president & CEO in 2004. Head serves on the advisory board of the USI Romain School of Business, the Evansville Regional Economic Partnership and the West Side Professional and Business Association. He served as chair of the IBA in 2016 and as the state’s delegate on the national board of the Independent Community Bankers of America from 2016-22. Head earned an MBA from the University of Evansville. Angie Rittenhouse celebrated 40 years with The Bippus State Bank, Huntington, in July. She has spent her entire career at the bank, where she currently holds the title of escrow processor. environments. On the asset side of the balance sheet, lower rates will likely mean lower asset yields. This could cause some pressure on margins for the industry if asset yields decline more than cost of funds. As with anything, proactive management can help mitigate risks. Analyzing the rate environments that present the greatest risk to earnings during the interest rate risk management process, and managing to those risks, remains the best strategy. As deposits remain competitive, having a plan to maintain higher asset yields, rather than relying solely on a decrease in cost of funds, should be a top priority. Used strategically, this is an area where the bond portfolio can really shine, as the right kinds of bonds offer natural falling-rate protection and a hedge against declining asset yields. Loans offer higher yields but carry the risk that customers have significant influence over the rate in falling-rate environments via refinancing and note modifications. Maximizing income with higher loan yields while also not neglecting the bond portfolio can put institutions in a favorable position to limit falling asset yields should we see continued cuts from the Fed. Dillon Wiedemann Senior Vice President – Financial Strategies Group The Baker Group Wiedemann works with clients in a broad range of areas including investment portfolio management, education, swap strategies, and interest rate risk management. A regular speaker at the company’s various educational seminars across the country, Wiedemann holds a bachelor’s degree in finance from the University of Central Oklahoma. The Baker Group is a Preferred Service Provider of the Indiana Bankers Association and an IBA Diamond Associate Member. The ONLY data analytics platform built for bankers, by bankers Indiana Bankers, meet KlariVis Your newest Preferred Service Provider KlariVis.com September/October 2025 17
Q Deposit Account CONTROL AGREEMENTS WHAT ARE THEY, AND ARE THEY SAFE TO SIGN? BY KEATON J. MILLER, KRIEG DEVAULT LLP Question: A depositor presented our branch with something called a “DACA” and asked us to sign it. This is a really good customer, and we’d like to accommodate their request. What’s a DACA, and can we sign it? Answer: Deposit Account Control Agreements (or “DACAs”) are not without their risks. Any bank agreeing to enter into one for the benefit of a depositor should understand what risks they’re signing up for, ensure they have proper systems in place to manage the agreement and confirm they are properly protected from legal liability under the agreement. A DACA is the method by which a depositor grants a lender a security interest in its deposit account. If the lender is also the depository bank, it can automatically have its lien perfected by virtue of directly controlling the account.1 However, if the lender is different than the depository institution, the lender must perfect that security interest by the “control” gained through a tri-party agreement with the borrower, lender and depository bank, commonly referred to as a DACA.2 These can be in the form of a “blocked” DACA, where the customer’s access to an account is blocked; or they can be in the form of a “springing” DACA, where a customer’s access to the account is not cut off until the lender notifies the depository bank to do so. This sounds simple enough – so what’s the risk? Oftentimes banks fail to have proper operational protocols in place to deal with these agreements. The bank needs to conduct a check to ensure no existing loans are intended to be secured by the applicable deposit account. Not doing this can inadvertently leave the bank uncollateralized on a loan it intended to be cash-secured! The bank also needs to ensure it can track which accounts are subject to these agreements and when it needs to freeze access to the account. If the account isn’t frozen and a creditor wants to COMPLIANCE CONNECTION Keaton Miller is a member of the firm’s Financial Institutions Practice, where he provides strategic and business-focused legal counsel to public and private companies on commercial and consumer lending, corporate governance, risk management, regulatory compliance, and mergers and acquisitions. Krieg DeVault LLP is a Diamond Associate Member of the Indiana Bankers Association. claim funds that should be in the deposit account, the depository bank could be liable to the lender for the account’s withdrawn funds. Even if your bank handles all the operational risk perfectly, DACAs can still present risk to the bank. If the lender attempts to seize the account or have it blocked, litigation often arises between the lender and depositor, with your bank being drawn into a costly lawsuit. DACAs should properly indemnify the depository bank to protect them from the high costs of unwanted litigation. Perhaps most importantly, many banks are unaware that they can (and should) charge for this service! They take on the operational risk of these agreements without being compensated in return. DACAs should include fee provisions for the depository bank. If your bank decides it’s not interested in taking on the risk of entering into a DACA, Indiana law provides you with express protection and states that banks are not required to enter into DACAs, “even if its customer so requests or directs.”3 This information is provided for general education purposes and is not intended to be legal advice. Please consult legal counsel for specific guidance as to how this information applies to your institution’s circumstances or situation. 1 Ind. Code § 26-1-9.1-104(a)(1) 2 Ind. Code § 26-1-9.1-104(a)(2) 3 Ind. Code § 26-1-9.1-342 Keaton J. Miller Of Counsel Krieg DeVault LLP KMiller@KDLegal.com 18 HOOSIERBANKER
IBA ‘HIGH FIVE’ AWARDS Congratulations to Chris Bennett and Maria Dowers, who were honored with the Indiana Bankers Association High Five Award in June and July, respectively. Bennett serves as the Association’s vice president of meetings & events, and Dowers is executive and government relations coordinator. The High Five Awards support professional development by inviting Association members and staff to submit names of IBA employees who perform outstanding acts of service. Nominations are read at monthly staff meetings, and a drawing determines the winner. To nominate an IBA employee for the High Five Award, call (317) 387-9380 or email HB@indiana.bank. Bennett Dowers Krieg DeVault proudly welcomes Keaton Miller to our Financial Institutions Practice. With deep experience as Senior VP and Senior Assistant General Counsel at one of the Midwest’s largest and most acquisitive financial holding companies, Keaton brings strategic, business-focused legal counsel to Indiana’s banking community. His practice focuses on commercial and consumer lending, regulatory compliance, corporate governance, mergers and acquisitions, and more. Before practicing law, Keaton advised financial institutions nationwide as a consultant with a large accounting firm; adding to the well-rounded, industry-specific insight he now brings to our clients. Welcome to kmiller@kdlegal.com 317-238-6381 KEATON J. MILLER Of Counsel With over three decades of serving lenders and millions of flood certificates issued, why trust just any certification provider when you could hire what many would consider the industry leader in accuracy and customer care. SINCE 1991 Craig callahan | 800.945.0246 ccallahan@floodplain.com Ask craig how to experience the Fci difference risk free and learn more about why so many lenders trust floodplain consultants. a preferred vendor of the iba September/October 2025 19
I F E ATUR E Conversations Must Determine Our INNOVATION BUDGETS BY REBECA ROMERO RAINEY, INDEPENDENT COMMUNITY BANKERS OF AMERICA Innovation is one of those line items that can be hard to wrap our heads around. There’s no formula or silver bullet to determine how much to spend, so we annually face that Goldilocks conundrum of determining what’s too little, what’s too much and what’s just right. When faced with that uncertainty, I’ve found that dialogue can be the answer. Conversations with our leadership teams, full staffs and customers will spark ideas that can help us focus on our true needs and evaluate where our priorities lie. Those discussions start with determining how we define return on investment. With innovation, ROI is about looking through the lens of overall impact, not just how it will affect us financially in the year ahead. Ultimately, budgeting for innovation requires us to reverse-engineer our thinking and consider the price of not acting. We can’t just look at the fees for the technology or the integration; we also need to evaluate the cost of maintaining the status quo. That will help make the innovation investment more concrete and provide guidance for our decision-making. We need to take a particular pain point, evaluate what it currently costs us in terms of staff time, customer attrition or other relevant variables, consider what may shift in the future and evaluate both the short- and long-term impact. That analysis helps us gain concrete awareness to make informed decisions. And sometimes not acting is the right choice. Not every solution is going to work for everybody, but thoughtful conversations result in a conscious, strategic decision versus one informed by a reaction to a product price tag. This dialogue is critical to creating an innovation-centric culture, which is more about the process than the product. Brainstorming with our teams leads to valuable decision making, and the ROI comes out of the time we spend in discussion and a proactive approach to problem solving. Innovation is a journey, not a destination. It’s about enabling a mindset and culture that’s open to considering something different and continuing to shift with the needs of our customers and communities. As the financial services industry continues to evolve, we will increasingly face the challenge of balancing investment in innovation against budgetary constraints. Thoughtful discussions with our teams will shed light on the best approach for our individual banks. It’s in these discussions that we chart a course that’s right for our organizations, one investment at a time. Rebeca Romero Rainey President and CEO Independent Community Bankers of America Rebeca.RomeroRainey@ICBA.org Rebeca Romero Rainey is one of the nation’s foremost advocates of the community banking industry, with a focus on regulatory reform for our country’s nearly 5,000 community banks. A third-generation community banker, she is the former chairman and CEO of Centinel Bank of Taos, New Mexico. 20 HOOSIERBANKER
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