MAY/JUNE 2025 A PUBLICATION OF THE INDEPENDENT COMMUNITY BANKERS OF COLORADO BUILDING ON THE PAST, BANKING ON THE FUTURE. Red Team Testing Simulating Real-World Attacks to Strengthen Security Why Marketing Is More Important Than Ever in An Uncertain Economy Vigilante Justice? Financial Markets React Quickly to Policy Changes
©2025 The Independent Community Bankers of Colorado (ICBC) | The newsLINK Group LLC. All rights reserved. Independent Report is published six times per year by The newsLINK Group LLC for ICBC and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and education. The contents do not constitute legal advice and should not be relied on as such. If you need legal advice or assistance, it is strongly recommended that you contact an attorney as to your circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of ICBC, its board of directors or the publisher. Likewise, the appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. Independent Report is a collective work, and as such, some articles are submitted by authors who are independent of ICBC. While a first-print policy is encouraged, in cases where this is not possible, every effort has been made to comply with any known reprint guidelines or restrictions. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at (855) 747-4003. 6732 W. Coal Mine Ave., #640 • Littleton, CO 80123 • (303) 832-2000 2024-2025 OFFICERS ICBC CHAIRMAN Tom Ogaard President & CEO Native American Bank ICBC PRESIDENT Mike Hurst President Del Norte Bank ICBC PRESIDENT-ELECT Joe Martinez President & CLO San Luis Valley Federal Bank ICBC ICBA STATE DIRECTOR PJ Wharton President & CEO Yampa Valley Bank ICBC STAFF EXECUTIVE DIRECTOR Mike Van Norstrand mvannorstrand@icbcolo.org ADMINISTRATION DIRECTOR/ TREASURER Maelynn Lewis mlewis@icbcolo.org LEGAL COUNSEL Christian Otteson Partner Otteson Shapiro LLP LOBBYIST Mary Marchun Founding Partner The Capstone Group 2024-2025 DISTRICT DIRECTORS DISTRICT A Dan Ebert, Vice President, Evergreen National Bank Mark Sheeley, President/CEO, RNB State Bank/Front Range State Bank Robert Holt, Senior Vice President, North Valley Bank Jeff Walker, Senior Vice President & CCO, Redstone Bank DISTRICT B Mark Brase, President, Points West Community Bank Tim Croissant, Market President, Bank of Colorado Travis Goeglein, Senior Vice President, First FarmBank Scott Applegate, President and CEO, Bank of Estes Park DISTRICT C Ben Johnson, President, First National Bank Colorado Sean Lening, President, GN Bank Miles McClure, CEO, Rocky Mountain Bank & Trust Kathryn Perry, Senior Vice President, Park State Bank & Trust DISTRICT D Wade Gebhardt, Corporate President, Mountain Valley Bank John Stelzriede, Market President — Colorado River Region, Alpine Bank Jeris Romeo, Community Bank President — Avon & Eagle, ANB Bank Chad Zummach, Executive Vice President, Gunnison Bank & Trust ICBC ADVISORY BOARD MEMBERS Eric Budreau Partner Eide Bailly Jim Hall Managing Director Bond & Specialty Insurance — Financial Institutions, Travelers Bill Mitchell President & CEO Bankers’ Bank of the West Christian Otteson Partner Otteson Shapiro LLP 2 | INDEPENDENT REPORT
18 CONTENTS 10 14 CONNECT Email us mlewis@icbcolo.org Like us on Facebook ICBColo Connect with us ICBColo Follow us on X ICBColo Give us a call (303) 832-2000 Follow us on Instagram ICBColo 2025 PUB. 4 ISSUE 3 4 Support the ICBC’s Associate Members! 6 ICBC Preferred Providers FLOURISH 7 Let’s Come Together To Address Fraud By Rebeca Romero Rainey, President and CEO, ICBA FROM THE TOP 8 The Key to Driving Down Fraud Risk By Jack E. Hopkins, Chairman, ICBA 10 Unlocking Your Potential High-Performance Coaching and the 6 Pillars of Success By Connie West, Certified High‑Performance Coach, Gallup Certified Strengths Coach, Regional Vice President, The James Paul Group, ICBC Associate Member 12 Is It Time to Realign Your Legacy Consumer Liquidity Strategy? Yes — Now More Than Ever By Tim Barrett, Executive DDA Strategies, CSI, ICBC Associate Member 14 Vigilante Justice? Financial Markets React Quickly to Policy Changes By Jim Reber, President and CEO, ICBA Securities, ICBC Associate Member and Preferred Provider 16 ACT Deposit Program Can Help Improve Your Bank’s CRA Rating A Simple Solution for Improving Your Bank’s CRA Rating By Diane Ellis, Senior Managing Director, IntraFi SAVE THE DATE! 17 52nd Annual Convention 18 Deposit Strategies To Deepen Commercial Relationships By Matt Helsing, SVP and Northwest Regional Manager, PCBB, ICBC Associate Member 20 Strengthening Internal Controls in Community Banks By Plante Moran, ICBC Associate Member 22 Red Team Testing Simulating Real-World Attacks to Strengthen Security By Will Keller, Network Security Engineer, SBS CyberSecurity, ICBC Associate Member and ICBC Preferred Provider 24 Powering Up Your Debit Card Program Profitability By Matt Morrow, Regional Director of Sales — EFT, SHAZAM, ICBC Associate Member 26 Why Marketing Is More Important Than Ever in an Uncertain Economy By Jennie Brady, Director of Creative Solutions, Spry Inc., ICBC Associate Member 28 A Layered Approach to ATM Security By Levi Daily, CTO, Cook Solutions Group, ICBC Associate Member 30 Fighting Check Fraud on Day Zero By Ashish Bhatia, VP Product Management, Alogent, ICBC Associate Member 31 ICBA Community Network INDEPENDENT REPORT | 3
SUPPORT THE ICBC’S ASSOCIATE MEMBERS! ACCOUNTING | COMPLIANCE EideBaillyLLP. . . . . . . . . . . . . . . . . . . . . . . . . .(303)770‑5700 Fortner Bayens PC . . . . . . . . . . . . . . . ........ (303) 296‑6033 Forvis Mazars . . . . . . . . . . . . . . . . ......... (303) 861‑4545 MossAdamsLLP. . . . . . . . . . . . . . . . . . . . . . . .(503)471‑1277 Plante Moran** . . . . . . . . . . . . . . . . ........ (303) 740‑9400 ADVERTISING | EQUIPMENT | PRINTING | SUPPLIES Kristopher James Company . . . . . . . . . . . . . . . . . (800) 274‑9212 Spry.. .. .. .. .. .. .. .. .. .. ............ (303) 323‑4341 CAREER ADVANCEMENT Graduate School of Banking at Colorado . . . . . . . . (800) 272‑5138 CONSULTING | HUMAN RESOURCES AND MANAGEMENT | MARKETING | STRATEGIC PLANNING BankStrategiesLLC . . . . . . . . . . . . . . . . . . . . . . (303)291‑3700 (A Bankers’ Bank of the West Bancorp Inc. Subsidiary) Expert Business Development . . . . . . . . . . ..... (610) 771‑2121 *ICBA CRA Solutions .. .. .. .. .. .. ........ (877) 232-0859 *ICI Consulting Inc. .. .. .. .. .. .. .......... (316) 201‑8590 TheJamesPaulGroup . . . . . . . . . . . . . . . . . . . . (877)584‑6468 MJCPartners . . . . . . . . . . . . . . . . . ......... (213) 278‑0429 The NaviTrust Group . . . . . . . . . . . . . . ....... (801) 438-1842 Piper Sandler & Co. . . . . . . . . . . . . . . ........ (415) 978‑5057 *S&P Global .. .. .. .. .. .. .. .. ........... (434) 951‑6948 CORRESPONDENT BANKING SERVICE *Bankers’ Bank of the West .. .. .. .. .. ....... (303) 291‑3700 BellBank. . . . . . . . . . . . . . . . . . ........... (701) 371‑3355 Citizens Bank Farmington . . . . . . . . . . . . ...... (505) 599‑0100 INTRUSTBank . . . . . . . . . . . . . . . . ......... (800) 732‑5120 PCBB.. .. .. .. .. .. .. .. .. .. ........... (888) 399‑1930 TIB — The Independent BankersBank . . . . . . . . . . . (972) 650‑6000 CYBERSECURITY | IT CONSULTING AND SERVICES | COMPUTER PRODUCTS Alogent..............................(719)583‑8004 Botdoc.. .. .. .. .. .. .. .. .. ............ (719) 960-4475 CivITas Bank Solutions . . . . . . . . . . . . . ....... (303) 291‑3700 (A Bankers’ Bank of the West Bancorp Inc. Subsidiary) Cook Solutions Group . . . . . . . . . . . . . ....... (503) 260‑8562 Federal Protection Inc. . . . . . . . . . . . . . ....... (800) 299‑5400 FileInvite. . . . . . . . . . . . . . . . . . ........... (719) 771-3586 Richey May*** . . . . . . . . . . . . . . . . ......... (303) 721-6131 *SBS CyberSecurity .. .. .. .. .. .. .......... (785) 594‑0503 DATA PROCESSING | EFT | ATM | CARD PROCESSING | MERCHANT SERVICES *Bankers’ Bank of the West .. .. .. .. .. ....... (303) 291‑3700 *BluePoint ATM Solutions LLC .. .. .. .. ....... (540) 335‑2848 Computer Services Inc. . . . . . . . . . . . . . . . . . . . . (970) 212‑7104 DCI.................................(620)694-6800 *IBT Apps . . . . . . . . . . . . . . . . . . . . . . . . . . . . (512) 606‑1100 *ICBA Bancard / TCM Bank .. .. .. .. .. ....... (800) 242‑4770 Jack Henry & Associates . . . . . . . . . . . . ....... (417) 235‑6652 SHAZAM.. .. .. .. .. .. .. .. .. ........... (515) 288‑2828 VisaInc.. . . . . . . . . . . . . . . . . . ........... (415) 238‑3682 INSURANCE | BENEFIT SERVICES Bank Compensation Consulting . . . . . . . . . . . . . . (303) 482‑1844 First Insurance Services Inc. . . . . . . . . . . . ...... (719) 456‑2303 *ICBA Reinsurance . . . . . . . . . . . . . . . . . . . . . . (888) 790‑6615 *Travelers .. .. .. .. .. .. .. .. ............ (720) 200‑8416 INVESTMENTS | FUNDING AND LENDING PARTNERS B:SideCapital. . . . . . . . . . . . . . . . . . . . . . . . . .(303)657‑0010 TheBakerGroup. . . . . . . . . . . . . . . . . . . . . . . . (405)415‑7200 BancAlliance . . . . . . . . . . . . . . . . . ......... (301) 232‑5423 *BHG Financial Institutional Network*** .. .. .... (954) 263‑6399 Citizens Bank Farmington . . . . . . . . . . . . ...... (505) 599‑0145 Colorado Enterprise Fund . . . . . . . . . . . . ...... (303) 860‑0242 Colorado Housing and Finance Authority . . . . . . . . (303) 297‑7329 D.A.Davidson..........................(303)764‑6000 FHLBank Topeka — Denver Office . . . . . . . . ..... (720) 212‑9873 First Bankers’ Banc Securities Inc. (FBBS) . . . . . . ... (720) 709‑7613 GillCapital............................(303)296‑6260 HelloBello. . . . . . . . . . . . . . . . . . .......... (970) 946-6160 *ICBA Mortgage .. .. .. .. .. .. .. .......... (800) 253‑5356 *ICBA Securities . . . . . . . . . . . . . . . . . . . . . . . . (800) 422‑6442 IntraFi Network . . . . . . . . . . . . . . . . ......... (303) 706‑9265 Northland Securities Inc. . . . . . . . . . . . . . . . . . . . (303) 801‑3380 Olsen Palmer LLC . . . . . . . . . . . . . . . ........ (202) 803‑2620 Performance Trust Capital Partners . . . . . . . .... (312) 521-1000 Preferred Lending Partners . . . . . . . . . . . ...... (303) 861-4100 RocketPro. . . . . . . . . . . . . . . . . . .......... (704) 650-0622 Towne Mortgage Company . . . . . . . . . . ...... (303) 947-5244 USDA Rural Development . . . . . . . . . . . . ...... (720) 544-2916 West Gate Bank Mortgage . . . . . . . . . . . ...... (402) 434‑4116 LEGAL SERVICES Arnold&Porter. . . . . . . . . . . . . . . . . . . . . . . . .(303)863‑1000 Coan, Payton & Payne LLP . . . . . . . . . . . ...... (303) 861‑8888 Godfrey Law Group LLC . . . . . . . . . . . . ....... (303) 802‑6336 Hoffman Nies Dave & Meyer LLP** . . . . . . . . .... (303) 860‑7140 Markus Williams Young & Hunsicker LLC. . . . . . . . . (303) 830‑0800 Otteson Shapiro LLP (ICBC Counsel) . . . . . . . .... (720) 488‑0220 Spencer Fane LLP . . . . . . . . . . . . . . . ........ (303) 839‑3838 StinsonLLP . . . . . . . . . . . . . . . . . .......... (303) 376‑8400 Womble Bond Dickinson** . . . . . . . . . . . ...... (303) 623‑9000 LOAN REVIEW SERVICES EideBaillyLLP. . . . . . . . . . . . . . . . . . . . . . . . . .(303)770‑5700 Fortner Bayens PC . . . . . . . . . . . . . . . ........ (303) 296‑6033 ICBC LOBBYING AND PUBLIC RELATIONS The Capstone Group (ICBC Lobbyists) . . . . . . . . . . (303) 860‑0555 *ICBC Preferred Providers **Silver Associate Member ***Gold Associate Member 4 | INDEPENDENT REPORT
BHG is an endorsed vendor Alexis Simons 315.849.5658 simonsa@bhg-inc.com Contact your representative: OR Scan to learn more at BHGLoanHub.com Earn up to 7.75% BHG+NIM MORE PROFITS LESS RISK Since 2001, BHG Financial has helped 1,650+ community banks earn a combined $1.8B in interest income. • BHG Loan Purchase Program • More yield, less work • Low credit risk • Secure and reliable investment • Instant NIM enhancement Talk to us today about adding strong-performing assets to your portfolio.
ICBC PREFERRED PROVIDERS ICBC Preferred Providers are selected by bankers just like you, so give them special consideration when considering their proposals for your bank! To learn more about ICBC’s Preferred Providers, contact the ICBC at (303) 832-2000. Please note: ICBC endorses the listed companies but not all products offered by the company. Contact: Scott Wintenburg | swintenburg@bbwest.com | (303) 291-3700 or (800) 601-8630 Merchant services from Bankers’ Bank of the West help you grow customer relationships with mobile payments technology, competitive unbundled pricing, efficient approvals and startups, responsive support and training. Contact: Alexis Simons | simonsa@bhg-inc.com Creator of the largest community bank loan network in the country. ICBC members can access the BHG Loan Hub, a secure, state-of-art loan delivery platform and the number-one source for professional loans. Contact: Wade Zirkle | wade@bluepointatm.com | (720) 295-9142 Colorado-based BluePoint ATM Solutions provides cost-efficient, reliable, branch and off-site ATM equipment and managed services to community banks across the Mountain West. From equipment sales/leases to custom installations, CIT, and ongoing service and maintenance — BluePoint provides dependable, cost-efficient ATM programs tailored to meet your bank’s needs. Contact: Phil Layher | phil.layher@ibtapps.com | (512) 616-1188 IBT Apps® is an empowering core partner to community banks nationwide, offering end-to-end core and digital banking solutions that meet today’s customer demands. Their adaptable i2Suite banking system enables your bank to streamline operations, control costs and mitigate risks. Transform your bank with the power of one total solution. Contact: icba.org/solutions | (866) 843-4222 The ICBC supports and recommends the following products and services supplied by our national association, the ICBA: ICBA Bankcard and TCM Bank, N.A.; ICBA Compliance & Risk Management; ICBA Mortgage; ICBA Reinsurance; and ICBA Securities. Contact: Mike Hatch | mike.hatch@ici-consulting.com | (316) 201-8590 Since 1994, ICI Consulting has helped banks and credit unions to assess, cost justify, evaluate and convert core processing, digital banking, EFT, lending, document imaging, CRM and branch solutions. Contact: Brian Miller | brian.miller@sbscyber.com | (605) 923-8722 SBS is your cybersecurity partner. Our offerings include: TRAC™ — Cybersecurity risk management software; Cyber-RISK™ — Automated FFIEC cybersecurity risk assessment software; IT and Network Security Audits; Consulting Services; Full Service Vendor Management; Role-Based Certifications; Vulnerability Assessments; Penetration Testing and more! Contact: Joe Valdez | joseph.valdez@spglobal.com | (213) 549-2281 S&P Global combines exclusive analysis and in-depth data in real time for the banking, financial services and insurance industries. From bank branch data and government assistance programs to executive compensation and league tables, S&P is the final word in business intelligence on financial institutions. Contact: Madeline Dickman | mdickman@travelers.com | (720) 200-8293 Offering a wide range of customized insurance protection, Travelers SelectOne+® for financial institutions is designed to respond to the most recent trends in banking. 6 | INDEPENDENT REPORT
Some of the most effective approaches to fraud prevention emerge through conversations about what has worked within your banks. FLOURISH Let’s Come Together To Address Fraud When it comes to fraud, it takes a village. That may be partly because fraudsters continue to get more sophisticated, and fraud’s effect on banking is skyrocketing. According to the Federal Trade Commission, consumers lost upwards of $12.5 billion to fraud in 2024 — a 25% increase year after year. Additionally, community banks ranked cybersecurity as the highest internal risk to their banks, notes the Conference of State Bank Supervisors. Fortunately, the core pillars of ICBA — education, innovation and advocacy — all address fraud risks by providing information, tools and resources to circumvent mounting threats. We’re empowering you with knowledge of the latest attacks and ways to protect against them, technology solutions to employ to shield your organizations, and connections to government agencies to ensure just and fair fraud protections, as well as collaborations to stop it in its tracks. Case in point: Consider our partnership with the U.S. Postal Inspection Service to combat the threat of check fraud. We are working together to deliver in-branch educational materials with step-by-step instructions to help consumers safeguard their financial assets and respond if they experience this type of fraud. Yet, some of the most effective approaches to fraud prevention emerge through conversations about what has worked within your banks. That firsthand knowledge goes a long way in providing a tried-and-true solution to an immediate problem. It’s also this connection that enables you to alert one another to the latest scams and advise each other on how to prevent losses for your customers and your banks. ICBA Community (community.icba.org) offers a platform to facilitate these conversations in a secure, digital fashion all year round. Outside the individual relationships you have with colleagues, ICBA Community allows you to connect with new bankers, throw out a question to see who’s experienced something similar, share a strategy about what worked in preventing an attack, and so much more. This spirit of helping one another makes community banking unique. We come together to offer advice and support for the common good. Very few industries can point to the level of collective positive impact we have. For fraud, that makes all the difference, because fraud is everyone’s problem. To hit it head on, we have to approach it holistically across the industry, taking advantage of all the tools in our toolboxes. It takes this community of community bankers to make a difference. Collectively, we will continue to have an impact, thwarting one fraud attempt at a time. By Rebeca Romero Rainey, President and CEO, ICBA INDEPENDENT REPORT | 7
In today’s environment, community banks are battling increasingly sophisticated forms of fraud. Artificial intelligence (AI) impersonation has grown more prevalent, and we must be a lot more vigilant, increasing our reviews of transactions that, on the surface, appear normal. That added scrutiny requires a two-fold approach in the form of ongoing education and technological support. With such complex scams and fraud scenarios in play, community banks must prioritize staff training. If someone’s trying to impersonate a customer using AI or victimizing them via a scam, our teams need to be able to identify red flags and unusual behavior. To protect both our banks and our customers, we need to go that extra mile to verify every transaction is legitimate. Fortunately, this type of scrutiny speaks to an existing community bank strength — knowing our customers — but it’s also about ensuring we are up to speed on the latest scams. At my bank, we sign up for different alerts, including those from ICBA, that summarize the latest fraud attacks. Then, we not only share that information internally, but we also make it available to our customers, raising awareness of all the types of fraud we’re seeing and sharing examples of the latest scams to help protect them because knowledge is power. FROM THE TOP MY TOP 3 Ways to stop fraud: 1. Invest in strong BSA software. 2. Provide constant fraud trend education for staff and customers. 3. Use Positive Pay with business customers. The Key to Driving Down Fraud Risk By Jack E. Hopkins, Chairman, ICBA But in a complex fraud environment, you need more than knowledge alone to thwart fraud. That’s where technological tools enter the picture. For instance, we’ve recently tightened down our Bank Secrecy Act (BSA) software, and we also implemented a detailed wire transfer questionnaire. As part of our wire process, we have begun asking a series of questions on the transaction, including where it’s going and what it’s being used for, and we’ve stopped many fraudulent transactions by digging deeper into purpose. In the past year, between our software and this questionnaire, we estimate we’ve stopped upwards of $750,000 in fraudulent transactions. The fraud environment requires community banks to become detectives charged with determining the legitimacy of a transaction. Fortunately, today’s technology can help us in doing that. ICBA Innovation, through the ThinkTECH Accelerator and Preferred Service Providers, gives a shortlist of strong fraud mitigation partners that can serve as important assets in our fight against fraud and are worth considering for your bank’s needs. Because stopping fraud requires the right mix of technology tools and current knowledge, it’s up to each community bank to ensure we have appropriate solutions in place to address both. Fortunately, we have ICBA in our corner to support our work and keep us armed with the latest fraud prevention information and tools. 8 | INDEPENDENT REPORT
| Bank Stock Loans | Loan Participations | ATM/Debit | International Services | | Cash Management | Securities Safekeeping | Merchant Services | 800-873-4722 | NE: 888-467-5544 | www.bbwest.com Where community banks bank Est. 1980 – 45 years of service to community banks “As a service provider exclusively focused on community banks, Bankers’ Bank of the West is here to help strengthen our clients and the communities they serve.” Across the western states and Great Plains, we’re the place where community banks bank. That’s because we provide the services, technology, and expertise to help you extend your resources, deliver for your customers, and stand out in your market. 5 reasons to partner with us BBW - President and CEO - Bill Mitchell 1. You can unlock efficiencies and cost savings. We can provide sophisticated solutions and economies of scale because we’re powered by hundreds of community banks across our region. 5. Our priorities are aligned with yours. 2. You can expand your capabilities. 4. We’ll never compete for your customers. 3. You can count on prompt, reliable service. • Independent loan review • Loan and credit administration consultation • Strategic planning facilitation • Management, staffing, & succession planning • Acquisition & expansion • BSA/AML compliance • Regulatory risk consultation President, Jim Swanson President, Anne Benigsen • Consulting • Phishing Tests • Vulnerability Management • Security Monitoring Cyber/information security, strategic planning, independent loan review, AND MORE. Consulting Services $ 8.45B assets under management $ 1.9B daily transaction value processed/settled Serving more than 60% of community banks across 7 states
HPI’s global research identified six key habits — known as the 6 Pillars of High Performance — that drive sustainable success. These pillars form the foundation of high-performance coaching. 1. CLARITY High performers are crystal clear about who they are, what they want and how they serve others. They set clear intentions and regularly reflect on their values and goals. Coaching focus: Help clients define their vision, align with their values and stay focused on what matters most. 2. ENERGY Without consistent physical and emotional energy, performance drops. High performers maintain energy through sleep, exercise, nutrition and mindfulness. Coaching focus: Build daily routines that boost energy and help clients show up fully for their work and relationships. High performance is no longer just for elite athletes or executives — it’s a mindset and skillset for anyone aiming to excel consistently while maintaining well-being. According to the High-Performance Institute (HPI), founded by performance expert Brendon Burchard, high performance means “succeeding beyond standard norms consistently over the long term while maintaining well-being and positive relationships.” Unlocking By Connie West, Certified High‑Performance Coach, Gallup Certified Strengths Coach, Regional Vice President The James Paul Group, ICBC Associate Member Your Potential High-Performance Coaching and the 6 Pillars of Success 10 | INDEPENDENT REPORT
3. NECESSITY A sense of purpose and urgency drives high performers to push through challenges. They link their actions to something bigger — identity, family, mission or service. Coaching focus: Connect clients with deeper motivations that make their goals feel essential, not optional. 4. PRODUCTIVITY High performers are strategic with their time. They focus on high-impact activities, reduce distractions and avoid burnout by working smarter — not longer. Coaching focus: Prioritize key outcomes, streamline workflow and eliminate non-essential tasks. 5. INFLUENCE Influence is the ability to positively affect others. High performers aim to be role models, build trust and inspire action. Coaching focus: Strengthen leadership, empathy and communication to boost connection and credibility. 6. COURAGE Courage drives action in the face of uncertainty. High performers speak up, take risks and pursue meaningful goals despite fear. Coaching focus: Encourage bold action, reframe failure and help clients grow their confidence. THE BOTTOM LINE High-performance coaching is about activating potential, not just fixing problems. By focusing on clarity, energy, necessity, productivity, influence and courage, individuals can achieve extraordinary results — while staying healthy, motivated and fulfilled. For help with high performance, contact Connie West at The James Paul Group at cwest@jamespaulgroup.com or (877) 584-6468. INDEPENDENT REPORT | 11
Proactive tools turn service disruptions into relationship-strengthening opportunities. Is It Time to Realign Your Legacy Consumer Liquidity Strategy? Yes — Now More Than Ever By Tim Barrett, Executive DDA Strategies CSI, ICBC Associate Member With rising consumer expectations, growing competition and ongoing economic uncertainty, banks can no longer rely on outdated, one-size-fits-all overdraft programs or legacy small-dollar loan offerings. Yet many institutions are still using ad hoc or legacy systems that lack transparency, adaptability and actionable insight. If your overdraft system assigns limits or manages old-school loan risk without your team understanding the logic behind those decisions — it is time to ask the tough questions. TODAY’S LANDSCAPE DEMANDS MORE Regulatory agencies like the CFPB, FDIC, OCC, state regulators and others are sharpening their focus on fairness, transparency and consistency in overdraft and liquidity practices. At the same time, customers expect financial institutions to deliver personalized and equitable service. Ask yourself: • Do we have a strategy to attract profitable consumers who seek new forms of liquidity? • Can we explain, defend and adjust our overdraft decisions in real time? 12 | INDEPENDENT REPORT
• Is our approach helping customers stay banked — not driving them away? • Do we offer loan options underwritten by deposit behavior? • Do we understand who is recovering from overdraft use — and who is not? If your answer is “no,” you are not alone — but now’s the time to act. DATA IS ONLY POWERFUL WHEN IT IS ACTIONABLE Banks sit on enormous amounts of valuable data — deposit trends, transaction behaviors, fees and recovery rates. But if your system does not adapt to risk, only provides canned reports, charges for peer benchmarking or hides key logic behind “proprietary” algorithms, you are flying blind. Worse, if you are applying the same limit to all accounts, you’re missing critical indicators of risk — and opportunity. A modern Consumer Liquidity small-dollar loan and overdraft program should: • React to individual account behavior daily. • Adjust limits automatically based on real activity. • Identify high-risk accounts before losses occur. • Offset risk from either the loan or overdraft use. This is not just about efficiency; it is about control, visibility and long-term customer relationships. TRANSPARENCY IS NOT OPTIONAL ANYMORE Can you explain how a customer’s overdraft limit was set this month versus last month? Do you know when their deposit patterns changed and what you did in response? Is your front-line staff comfortable with explaining options for informed decision-making? If not, your institution may be exposed to compliance and operational risk. A modern approach: • Trains front-line staff by experienced professionals. • Audits every account relationship daily. • Manages exception items automatically. • Documents decisions clearly for examiners. More importantly, it aligns with proven best practices and gives you the confidence to stand behind your program — regardless of who is asking. CONSISTENCY BUILDS TRUST — ESPECIALLY WITH FEE REFUNDS One of the most common struggles in overdraft programs is inconsistency in fee refund decisions. Without a structured approach, decisions often vary by branch, location or staff discretion — raising red flags and exposing your bank to bias claims or unfair treatment accusations. A data-driven, rules-based approach ensures refunds are handled fairly, consistently and with clear documentation. That protects both your institution and your customers. RETURNS AND DEBIT CARD DECLINES COST MORE THAN REVENUE Every time a debit card transaction is declined or ACH/check is returned, two things happen: 1. Your customer gets frustrated. 2. You lose income by discouraging consumption behaviors. Often, a minimal limit or Reg. E opt-out are the root causes that could be addressed with automated communication, expanded purchasing power and staff empowerment. A smart overdraft platform does more than record declines. It takes action: • Sends alerts or letters. • Flags trends by branch or region to help staff with messaging. • Triggers follow-up contact or educational outreach. Proactive tools turn service disruptions into relationship-strengthening opportunities. REPORTING SHOULD EMPOWER, NOT EXHAUST If your team needs IT support to run basic overdraft reports, your system is holding you back. Your executives, managers and frontline staff should be able to access the insights they need — on demand. That includes: • Fee consumption of deposits. • Reasons for declined transactions. • Service level and liquidity exposure tracking. • Charge-off trends by customer type, location or relationship. • Knowledge of what your peers are doing. When compliance, operations and marketing teams all have fast access to actionable data, your institution makes better, faster decisions — without relying on back-end bottlenecks. TAKE BACK CONTROL OF YOUR PROGRAM Your overdraft and consumer loan strategy should be an actively managed, strategically aligned part of your bank’s liquidity offerings — not a set-it-and-forget-it product. A modern solution helps you: • Be competitive with new fintech approaches. • Align risk with opportunity. • Provide transparent, fair services. • Stay agile in a shifting economic and regulatory environment. Ask yourself: Is your consumer liquidity approach helping build trust and resilience or keeping you anchored in the past? If it is the latter, it is time to realign. INDEPENDENT REPORT | 13
Vigilante Justice? Financial Markets React Quickly to Policy Changes 14 | INDEPENDENT REPORT
While it will possibly take months and even the rest of the year to see the full shakeout, April 2025 was a laboratory for market efficiency. Some might contend there was an element of ruthlessness in the activity. Starting even before the Trump administration’s trade policy tariffs went into effect on April 2, the “Bond Vigilantes,” a nebulous gang of institutional debt investors, started shooting up the place. Barely a week after so-called “Liberation Day,” the U.S. bond market — particularly the longer tenors — had administered its brand of frontier justice. The 10-year note, which has an outsized effect on the economy due to its correlation to mortgage rates, rose nearly 50 basis points (0.5%). At the same time, and tellingly for the mood of consumers and the broader global economy, all the major stock indices retreated. It’s not often that debt and equity markets move in tandem; more often than not, they travel in opposite directions. COULDN’T HELP NOTICING The term “bond vigilante” was coined by legendary economist Ed Yardeni in the 1980s, when long-term yields were soaring far into double-digit territory. It connoted investors who were uber-hawkish on inflation and were ready and willing to sell their holdings and drive prices down/yields up until they were satisfied that they were being adequately compensated for their price risk. There have been several periods in the 21st century when the vigilantes were barely visible, especially following the Great Recession and during the COVID-19 pandemic. The term came back into voguish use in 2022 as prices of goods began spiking year-over-year in the 8% range, and the Federal Reserve was hiking short-term rates every chance it got. We still haven’t seen inflation back in the 2% box the Fed has set as its objective. By some measures, inflation is picking up steam, so the vigilantes have remained on notice. The very real consequences of protracted trade wars, the worst of which could include price hikes accompanied by weakening labor markets, have gotten the attention of the inflation hawks, to say the least. DURATION DIVERGENCE Another interesting development following April 2 is the steepening of the yield curve to levels not seen since 2022. To be sure, a 50-basis point slope between “2s and 10s” does not qualify as steep. However, while the Fed has very carefully chosen its comments and is making no promises about further rate cuts (or rate hikes, for that matter), investors have begun to factor in an additional cut or two in the 2025 numbers. So why the steepening? Our “friends,” the vigilantes, are protecting themselves against more inflation deterioration. They are investors, by and large, at the long end of the curve, which is only marginally influenced by the Fed’s monetary policy, as long as that does not include open market operations. The Fed has recently confirmed it will continue to wind down its balance sheet, albeit at a slower pace than in 2024. At the short end of the curve, yields didn’t run up as much in the April 2 aftermath since the Fed has reiterated its “data-dependent” posture. This steepening, in essence, was building in the increased possibility of both a slowing economy and doubt about maintaining stable prices. LAW … AND ORDER? The fiscal “discipline” by both bond and stock investors caused the administration to walk back some of the harshest rhetoric regarding tariffs. After yields rose every day between April 4 and 12, they actually retreated the remainder of the month. The two-year note’s yield fell about 26 basis points for April, while the 10-year note fell about three basis points. It’s fair to say part of the return to relative calm was the administration softening its commentary on the removal or firing of Fed Chairman Jay Powell. The major stock market indices, all of which were down by double-digit percentages mid-month, ended up basically unchanged between +1% and -3%. The takeaway? Whether you consider yourself a bond vigilante or merely an observer, it’s clear that they’re back — and watching. The gang also has shown it still has enough collective clout to move bond market yields, and influence monetary, fiscal and trade policies. Those who choose to tangle with this notorious bunch had better pack a lunch — it could be a long slog. Jim Reber (jreber@icbasecurities.com) is president and CEO of ICBA Securities, ICBA’s institutional, fixed-income broker-dealer for community banks. By Jim Reber, President and CEO ICBA Securities, ICBC Associate Member and Preferred Provider INDEPENDENT REPORT | 15
ACT Deposit Program Can Help Improve Your Bank’s CRA Rating A Simple Solution for Improving Your Bank’s CRA Rating By Diane Ellis, Senior Managing Director, IntraFi For many bank executives, meeting the Community Reinvestment Act requirements can feel like solving an intricate puzzle. But a new initiative offers a safe, straightforward solution to one key aspect of CRA compliance. Launched this past year by the Community Development Bankers Association (CDBA) and the National Bankers Association (NBA), the Advancing Communities TogetherSM (ACTSM)Deposit Program provides banks with a secure and efficient way to fulfill their CRA obligations. By placing deposits into Community Development Financial Institutions (CDFIs) or Minority Depository Institutions (MDIs), your bank can earn credit toward the CRA’s community development and investment tests. “The ACT Deposit Program is a promising new tool for community and regional banks to earn CRA credit,” says Brian Blake, CDBA’s chief public policy officer and a former bank CRA officer. “ACT excels at meeting both the spirit and the letter of the CRA, and I believe it is very competitive compared with more complex, costly or time-consuming alternatives.” The ACT Deposit Program uses IntraFi’s ICS®, or IntraFi Cash Service®, so your bank’s deposit is eligible for millions of dollars in aggregate FDIC insurance at network banks. The minimum deposit under the program is $1 million for banks with $10 billion or less in assets and $5 million for larger banks. And the deposits earn interest. Note: IntraFi is not an FDIC-insured bank, and deposit insurance covers the failure of an insured bank. A list identifying IntraFi network banks can be found at intrafi.com/network-banks. Certain conditions must be satisfied for “pass-through” FDIC deposit insurance coverage to apply. Regulators define CRA “qualified investments” to include bank deposits with a primary purpose of community development. Under this definition, and subject to considerations such as the asset size and assessment area of the bank seeking CRA credit, deposits placed at CDFI and MDI banks qualify for CRA consideration. While CRA guidelines require CDFIs to be located within a bank’s assessment area to qualify for the credit, deposits into any MDI bank qualify regardless of geographic location. Currently, there are 34 MDIs and 64 CDFIs1 operating in 31 states participating in the ACT Deposit Program. Scan the QR code to see the full list. https://www.intrafi.com/act-depositprogram#find-a-bank Blake notes that these deposits will help CDFIs and MDIs do even more to help underserved communities. “ACT program deposits put capital to work in communities that need it most,” he says. “Because CDFI and MDI banks operate in low-income or low-wealth communities, their funding options are limited — but they excel at financing affordable housing and small businesses, creating jobs and expanding neighborhood facilities in low-income communities.” Blake adds that ACT deposits offer banks qualitative benefits when it comes to CRA ratings since the deposits meet standards of being responsive, flexible and innovative. He concludes that “when leveraged by CDFI and MDI banks, ACT deposits go to very good use.” 1 Fifteen ACT Deposit Program banks are both CDFIs and MDIs. If your bank is looking for a secure, effective way to meet CRA’s community development or investment tests, visit the ACT Deposit Program website at www.intrafi.com/act-deposit-program or email Diane Ellis at dellis@intrafi.com. Deposit placement in the ACT Deposit Program within ICS (“Program”) is subject to the terms, conditions, and disclosures in applicable agreements, including the ACT Addendum to the ICS Deposit Placement Agreement. A portion of a deposit placed in the Program may be allocated to IntraFi network banks that are not CDFIs or MDIs. The interest rate earned on Program deposits will likely be lower than the interest rate available on deposits outside of the Program. IntraFi and ICS are registered service marks, and ACT is a service mark, of IntraFi LLC. 16 | INDEPENDENT REPORT
By combining industry-specific insights, relationship-based product design and rate sensitivity analysis, community banks can grow their commercial deposit base in a way that is both strategic and sustainable. Deposit Strategies To Deepen Commercial Relationships By Matt Helsing, SVP and Northwest Regional Manager PCBB, ICBC Associate Member Many community banks have struggled in recent years to grow deposits while keeping costs in check. As competition intensifies, the banks that succeed will be those that take a more strategic and segmented approach. Total deposit balances in U.S. banks dropped by 7% between Q1 2022 and Q3 2023, reflecting broader headwinds for financial institutions. However, commercial balances rose 2% between Q3 2023 and Q1 2024, according to a 2024 McKinsey report. Analysts expect continued gains through 2025, giving community banks a window to refine and expand their approach. To capitalize on this trend, community banks may want to consider shifting from broad rate-based tactics to more targeted, relationship-oriented strategies. The following are some practical ways to strengthen and grow your commercial deposit base. STRENGTHEN PRIMARY BANKING RELATIONSHIPS Customers with a full-service relationship generate far greater value — up to 20% higher ROE — than lending-only clients. Make deposit relationships a core part of your business banking model by cross-promoting treasury services, cash management and account bundling. One effective tactic: tie deposits to lending. Requiring a deposit relationship as part of a lending package can be mutually beneficial. It simplifies payments for the borrower and broadens the relationship for the bank. It also gives your institution better visibility into the business’s liquidity patterns. 18 | INDEPENDENT REPORT
USE EARNINGS CREDIT RATE (ECR) ACCOUNTS STRATEGICALLY ECR accounts can be a powerful tool for deepening commercial relationships and mitigating rate sensitivity. Business clients that use earnings credits to offset fees on services like treasury, ACH and wire transfers are typically less focused on rate alone, making them more stable depositors. These accounts effectively shift the conversation from “What rate can you give me?” to “How can I maximize value with your services?” That dynamic not only supports retention — it can also reduce pricing pressure across your broader deposit portfolio. To get the most from ECRs, community banks should regularly evaluate fee-based service usage, monitor credit utilization and explore ways to bundle ECR offerings with treasury or cash flow tools that increase business stickiness. SEGMENT BY INDUSTRY Not all business sectors behave the same when it comes to deposit pricing and relationship depth. Understanding these differences is key to optimizing your commercial deposit strategy. Lower-rate sectors — such as education, public administration and professional services — tend to earn below-average deposit rates. These industries often have lower loan-to-deposit ratios, which may make them more attractive for funding but less active on the lending side. Higher-rate sectors — including retail, finance and manufacturing — typically require more robust lending relationships and may command above-market deposit pricing in return. Community banks that cultivate a diverse mix of industries can avoid concentration risk, better align pricing with relationship value and ensure long-term stability. Knowing where each client segment fits on the risk-return spectrum helps tailor offerings that balance deposit stickiness with profitability. IDENTIFY LOYAL, LESS RATE-SENSITIVE CLIENTS Some of your customers might stay with you even if the rates you pay them are a little below market average. Those clients are invested in their relationship with you, value your expertise and aren’t going to move from institution to institution to chase rates. Pinpointing those clients based on factors like tenure, transaction data or the number of products they use from you can help you focus on those customers to keep their deposits sticky. TAILOR TO RATE SENSITIVITY McKinsey’s commercial deposits analytic team looked at more than $1 trillion in commercial deposits and how they fared as interest rates rose and fell. Which clients were more sensitive to rate changes? They found that the business clients most likely to move their money to another financial institution are those that have interest rates 100 basis points to 150 basis points below market. Deposits are at risk again for customers who are getting significantly higher-than-average rates because these clients are likely comparing banks to find the best rates. CONCLUSION Commercial deposits are showing signs of recovery — but not all deposits are equal, and not all clients behave the same. By combining industry-specific insights, relationship-based product design and rate sensitivity analysis, community banks can grow their commercial deposit base in a way that is both strategic and sustainable. To continue this discussion or for more information, please contact Matt Helsing. Dedicated to serving the needs of community banks, PCBB’s comprehensive and robust set of solutions includes cash management services such as Settlement and Liquidity for the FedNow® Service, international services, lending solutions, and risk management advisory services. INDEPENDENT REPORT | 19
Strengthening Internal Controls in Community Banks By Plante Moran, ICBC Associate Member When it comes to community banking, a strong reputation and resilient operations are paramount. So is strengthening internal controls. Regular monitoring and evaluation of these controls are essential for maintaining their effectiveness and safeguarding your community bank’s integrity. Here’s how … Maintaining robust internal controls is essential to ensure operational integrity and compliance for community banking. Changes in personnel, processes or technology can introduce new risks and challenges, making it crucial for banks to have effective strategies in place to monitor and evaluate their internal controls. Here are some best practices to consider: 1. CONDUCT REGULAR RISK ASSESSMENTS Regular risk assessments are the cornerstone of a strong internal control system. These assessments help identify potential vulnerabilities and areas that require attention. When there are changes in people, processes or technology, it’s important to reassess risks to ensure that new threats are promptly addressed. This proactive approach allows banks to adapt their controls to the evolving landscape and mitigate risks effectively. 2. IMPLEMENT CONTINUOUS MONITORING Continuous monitoring involves the real-time tracking of transactions and activities to detect anomalies and irregularities. By leveraging advanced analytics and automated tools, community banks can enhance their ability to monitor a large volume of transactions or activities, focus manual efforts on anomalies and respond to potential issues swiftly. Continuous monitoring is particularly valuable during periods of change, as it provides ongoing assurance that controls are functioning as intended. 3. STRENGTHEN SEGREGATION OF DUTIES Segregation of duties is a fundamental principle of internal control that helps prevent fraud and errors. When there are changes in personnel or systems, it’s essential to review and adjust the allocation of responsibilities to maintain proper segregation. This ensures that no single individual has control over all 20 | INDEPENDENT REPORT
aspects of a transaction, reducing the risk of unauthorized activities. Many banks authorize broader user access in times of software conversion and should remember to restrict capabilities post-conversion. 4. ENHANCE TRAINING AND AWARENESS Effective internal controls rely on the knowledge and vigilance of your staff. Providing regular training and raising awareness about the importance of internal controls can empower staff to recognize and report potential issues. When staff understand the objective of their controls, including specific examples of what could go wrong if the control fails, it increases the buy-in and effectiveness of control operators. When new processes or technologies are introduced or when new risk trends are identified, targeted training sessions can help employees understand their roles and responsibilities within the updated control framework. Control operators also have the opportunity to provide feedback on how to make the controls operate more effectively or efficiently. 5. CONDUCT INDEPENDENT AUDITS Independent audits provide an objective evaluation of a bank’s internal control system. The internal audit function — whether in-house or co-sourced with an external audit partner — can offer valuable insights and identify areas for improvement. Audits are especially important during times of change, as they provide an unbiased assessment of how well the bank’s controls are adapting to new circumstances. Internal audit scope and coverage should be responsive to the regular risk assessment. 6. EVALUATE WHEN ERRORS ARE IDENTIFIED When there’s a breakdown identified in the operation of a control, management should pinpoint the root cause of the error and implement actions to correct it. Too often, these operating deficiencies are met with band-aid fixes, which often allow additional future errors if the source of the problem isn’t addressed. 7. FOSTER A CULTURE OF ACCOUNTABILITY Creating a culture of accountability is essential for the success of internal controls. Encouraging employees to take ownership of their roles and responsibilities fosters a sense of commitment to maintaining control standards. When changes occur, clear communication and leadership support can reinforce the importance of adhering to internal control policies. Executives can demonstrate their commitment to quality by participating in risk assessments, helping prioritize control enhancements and providing positive reinforcement when controls operate effectively. 8. UTILIZE TECHNOLOGY SOLUTIONS Technology can play a significant role in enhancing internal controls. Implementing robust software solutions for transaction monitoring, data analysis and reporting can streamline control processes and improve accuracy. For example, many banks have realized the benefits of automating elements of their Bank Secrecy Act (BSA) programs and other compliance-based requirements where software can be trained to mine through a large quantity of data and flag for follow-up items that meet predetermined risk-based criteria. As banks adopt new technologies, it’s important to ensure that these tools are integrated into the control framework and that staff are trained to use them effectively. 9. MAINTAIN DOCUMENTATION Keeping documentation to support control evidence is essential, and using technology effectively can help in this area as well. Many document storage solutions offer review capabilities and detail tracking. These tools can notify users of unreviewed or incomplete documents, helping to identify control failures and enabling timely corrective actions. By integrating these tools into the internal control framework, banks can ensure thorough documentation and more efficient control operations. 10. REVIEW AND UPDATE POLICIES AND PROCEDURES Policies and procedures should be regularly reviewed and updated to reflect changes in the bank’s operations and regulatory environment. Clearly defining control procedures can be especially beneficial for management review controls, where the control owner should clearly define what their criteria for investigation are, what their review entails and what must be documented as evidence that the control operated. When new processes or technologies are introduced, it’s crucial to revise control policies to ensure they remain relevant and effective. Clear and up-to-date documentation helps guide employees and maintain consistency in control practices. SAFEGUARD YOUR REPUTATION WITH REGULAR MONITORING AND EVALUATION Community banks can strengthen internal control systems and navigate changes with confidence with these best practices. Regular monitoring and evaluation of controls help banks remain resilient and capable of addressing emerging risks, ultimately safeguarding operations and a very valuable asset — your reputation. Scan the QR code to see how Plante Moran can help your bank. https://www.plantemoran.com/industries/ financial-services/banks?utm_source=qrcode&utm_ medium=association&utm_campaign=PENFSG-2025_ICBC INDEPENDENT REPORT | 21
www.thenewslinkgroup.orgRkJQdWJsaXNoZXIy MTg3NDExNQ==