Hoosier Banker JUNE 2016 INSIDE IBA Mega Conference 2016: Mega Impact Story on page 8. 1916 - 2016 YEARS IMPACT MEGA
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TABLE OF CONTENTS VOLUME 100 NO. 6 6925 Parkdale Place Indianapolis IN 46254-4673 Phone: 317-387-9380 Fax: 317-387-9374 Twitter @indianabankers www.indianabankers.org Publisher: S. Joe DeHaven Editor: Laura Wilson Advertising: Rod Lasley Email news releases to: IBAcommunications @indianabankers.org Hoosier Banker (ISSN 0018-473X) is published monthly by the IBA Service Corp., a subsidiary of IBA Holding Company Inc., that is a wholly owned subsidiary of the Indiana Bankers Association. The magazine invites news from IBA members. Copy deadline: first of the month preceding publication. Advertising: Rates available upon request or online at www.indianabankers.org. Advertisers should provide electronic PDFs by the fifth day of the month preceding publication. Hoosier Banker advertising is available to members and associate members of the Indiana Bankers Association only. Subscriptions: Hoosier Banker subscriptions are provided free of charge exclusively to members and associate members of the Indiana Bankers Association. Public access to Hoosier Banker Digital is available at www.indianabankers.org. COVER STORY 8 MEGA IMPACT OF THE 2016 IBA MEGA CONFERENCE FEATURES 5 CEO PONDERINGS S. Joe DeHaven, IBA 7 IBA CALENDAR OF EVENTS 10 2016 MEGA CONFERENCE PHOTO GALLERY 14 HOOSIER BANKER HERITAGE 16 APRIL 2016 SURVEY RESULTS: FINANCIAL LITERACY MONTH FLD HAPPENINGS 20 FLD BUILDS MOMENTUM AT IBA MEGA CONFERENCE Dax Denton, IBA PSP SHOWCASE 24 INDIANA BANKERS RELY ON ACCURACY AND RELIABILITY Rod Lasley, IBA DIRECTORS / SENIOR MANAGEMENT 26 WHEN INTEREST RATES RISE,WILLYOUR PORTFOLIO’S YIELD FOLLOW? Lester F. Murray,The Baker Group 28 WHAT ARETHE BESTWAYSTO FUNDYOUR RETIREMENT PLANS FOR EXECUTIVES AND DIRECTORS? David Shoemaker and Becky A. Pressgrove, Equias Alliance DEPARTMENTS 18 ANNIVERSARY MILESTONES 22 COMPLIANCE CONNECTION Brett J.Ashton, Krieg DeVault LLP 23 NEW BRANCHES, BUILDINGS & OPENINGS 23 ASSOCIATE MEMBERS’ CORNER 31 HONORABLE MENTIONS 32 BANKING ON COMMUNITY 34 TAKING IT EASY 35 BANKERS ON THE MOVE 38 ADVERTISERS INDEX IMPACT MEGA 1916 - 2016 YEARS 3 Hoosier Banker June 2016 “Mega Impact” was the theme of the 2016 IBA Mega Conference.
Mission To advocate for and sustain an environment in which banks can succeed. Vision To provide exemplary service to members as the premier state bank trade association in the country. Values In fulfilling our mission, we will: • Maintain the highest ethics, integrity and respect for others; • Serve with professionalism, innovation and resourcefulness; • Instill passion, positive attitude and enthusiasm; • Remain mindful that the success of the IBA is judged by the success of its members. View Hoosier Banker Digital at indianabankers.org Publication Disclaimer Hoosier Banker articles are published by the IBA Service Corp., a subsidiary of IBA Holding Company Inc., that is a wholly owned subsidiary of the Indiana Bankers Association. All material published in Hoosier Banker and/or on the IBA website is the property of the Indiana Bankers Association. Indiana Bankers Association Officers, Directors & Staff IBA Officers Chairman ........................................... Michael H. Head, First Federal Savings Bank, Evansville FirstVice Chairman ..................... Annette M. Russell, Security Federal Savings Bank, Logansport SecondVice Chairman ............................................ Clay W. Ewing, German American, Jasper Immediate Past Chairman .................................. Larry W. Myers, First Savings Bank, Clarksville Chief Executive Officer ....................... S. Joe DeHaven, Indiana Bankers Association, Indianapolis President .................................. Amber R.VanTil, JD, Indiana Bankers Association, Indianapolis Constituent Directors ICBA State Director ........................................ David M. Geis, Jackson County Bank, Seymour ABA Membership Council ....................... Michael K. Bauer,Your Community Bank, New Albany Future Leadership Division President ...................... Kristin Marcuccilli, STAR Bank, Fort Wayne Non-Indiana Headquartered Bank Director ............... Tim Massey, BMO Harris Bank, Indianapolis Northeast Region Directors Gregory Maxwell, Farmers State Bank, Mentone Michael S. Zahn, First Federal Savings Bank, Huntington Michael C. Marhenke, iAB Financial Bank, Fort Wayne Northwest Region Directors Benjamin J. Bochnowski, Peoples Bank, Munster Arden L. Cramer, Logansport Savings Bank Joseph D. Carlson, Community State Bank, Royal Center Southeast Region Directors Archie M. Brown Jr., MainSource Financial Group Inc., Greensburg Dennis Wayman, State Bank of Medora George W. Ferriell, Bath State Bank Southwest Region Directors Matthew W. Howrey, North Salem State Bank Michael L. Baker, State Bank of Lizton, Brownsburg Kent L. Parisien, The First National Bank of Odon Future Leadership Division Board President - Kristin Marcuccilli, STAR Bank, Fort Wayne Vice President - Kirby Drey, Kentland Bank Emily Boardman, Crossroads Bank,Wabash Craig Buse, Springs Valley Bank & Trust Company, French Lick Jason Ernst, First Financial Bank, NA,Ter re Haute J. Daniel Maddox, Citizens State Bank, New Castle Andrew J. Saner, MainSource Bank, Greensburg Stephanie Schrage, Centier Bank, Northern Indiana Jeremy Siegle, Bank of Wolcott Lucas White,The Fountain Trust Company, Covington Billy Winter, Bippus State Bank, Huntington Melodie K.Yarnell, Jackson County Bank, Seymour IBA Staff Chief Executive Officer .......................................................................... S. Joe DeHaven President ..................................................................................... Amber R.VanTil, JD ExecutiveVice President .............................................................. Paul W. Freeman, CAE SeniorVice President–Government Relations ................................................... Dax Denton Vice President–Meetings & Events ............................................ Christina M. Bennett, CMP Vice President–Products & Services ................................................................. Rod Lasley Vice President–Education & Training ........................................................... Laurie A. Rees Vice President–Communications .................................................................. Laura Wilson AssistantVice President–Government Relations ........................................... Erika L. Hall, JD Events & Products/Services Assistant .............................................................. Susan Clark Education Meeting Coordinator ................................................................. Marcy Borden Education Meeting Coordinator ................................................................ Elizabeth Kilty Staff Accountant ....................................................................................... Timothy Fry IT and Facilities Manager ............................................................................. Tracy Kubly Administrative Assistant ........................................................................... Michelle Long Government Relations & Communications Office Manager ............................ Joshua A. Myers Email addresses: First initial of the staff member’s first name plus last name; example: jdoe@indianabankers.org Please send news releases to: IBAcommunications@indianabankers.org 4 Hoosier Banker June 2016
5 Hoosier Banker June 2016 day there are no products and services that some nonbank competitor can’t offer. As with individuals who play roles so long that they change their personas, in the public’s eye these companies that pretend to be banks eventually are perceived as banks. This was never more obvious than at the beginning of the financial crisis, when the national news media labeled any organization that made loans, did appraisals, or served as investment banks or bond rating agencies as banks. Taxpaying commercial banks were never differentiated and never fairly assessed as to their performance leading up to and during the crisis. As Elvis expressed, “The world’s a stage, and each must play a part.” Let’s make sure we understand which players are playing which parts, and keep the actors from morphing further into something they are not. It will remain incumbent upon commercial banks, and the trade associations that represent and advocate on behalf them, to be even more vigilant in their efforts to level the playing field with these nonbank companies. I assure you that the Indiana Bankers Association, American Bankers Association and Independent Community Bankers of America will continue to lead the fight. It is the part that we play on the world stage. FEATURE CEO Ponderings S. Joe DeHaven, Chief Executive Officer, Indiana Bankers Association Congratulations to the following bankers, who have completed the Indiana Bankers Association 2015-16 Branch Management Series. Shown are (left to right): Jennifer Braffet from BloomBank, Bloomfield; Nikki Hollingsworth, North Salem State Bank; Catherine Zeider, Kentland Bank; and Mary Finney, The Napoleon State Bank. IBA Branch Management Series Elvis Presley was an amazing talent. He recorded dozens and dozens of hit songs, starred in numerous movies and broke millions of young girls’ hearts. I have enjoyed Presley’s music my entire life, and my favorite song of his is “Are You Lonesome Tonight?” The words and music were written by others, but Elvis brought this beautiful ballad to life. It describes the heartache of a man who loved and lost – a story as ancient as time. Elvis sings at the beginning and end of the song, but in the middle, he talks. That dramatic talking part has always intrigued me: “I wonder if you’re lonesome tonight. You know someone said that the world’s a stage, and each must play a part.” That “someone” was William Shakespeare, and I have thought a lot about that wisdom over the years. Elvis and the Bard were right: All the world’s a stage, and we each play a part. Sometimes we play parts that are in contradiction to who we really are. I have talked with professional speakers who admit to being shy, yet they shine as outstanding speakers who play the role well. I have known people who play tough negotiators in business, yet their true nature is rather demure. One thing that I have noticed, in myself and others, is that if people play roles long enough, they start to become the people they are playing. Their innate personas change to match the roles. Bankers deal with morphing of competition every day. A few years ago, the buzz phrase for bank competition was “nonbank banks.” Then it was the “shadow banking system,” and now “FinTech.” All of these competitors have traits in common. First, they enjoy significant regulatory and capital advantages over banks. I have always believed that these institutions that act like banks should be subject to the same regulatory requirements and similar capital requirements. Second, many of these institutions are not subject to the same tax burden as banks. Institutions that are acting like banks in the services and products they offer should pay their fair share in taxes. Third, some have quasi-governmental relationships that allow them access to capital markets that banks do not have. That, too, seems wholly unfair. While these firms might argue that banks have an innate advantage in collecting low-cost deposits, they overlook the significant cost in regulatory compliance and deposit insurance associated with those deposits. If these actors want to have access, then they should raise capital and apply for bank charters. When I began my banking career, banks had many products and services that only banks could provide. To-
6 Hoosier Banker June 2016 Michael A. Renninger Principal (317) 695‐7939 mrenninger@renningerllc.com Securities offered through Ausdal Financial Partners, Inc., 5187 Utica Ridge Road Davenport, IA, 52807 (563)326‐2064 Member: FINRA, SIPC. Renninger & Associates, LLC and Ausdal Financial Partners, Inc. are independently owned and operated. www.renningerllc.com "For an ���e���e��ssess�en��of Your Challenges and ����ess��nal���e����n�of Your �������n��es" of Association Executives, he has been active with the Indiana Geographic Information Council, Transportation Enhancement Appropriations Committee, Indiana Historic Preservation’s Courthouse Preservation Task Force and the Lead Elimination Plan Advisory Committee of the Indiana Department of Health. In 2012 Denton was named Association Professional of the Year by the Indiana Society of Association Executives, and in 2013 he won in the category of Banking & Financial Services for the Best & Brightest awards, sponsored by Junior Achievement of Central Indiana Inc. He is a graduate of Indiana University, has completed the IBA Leadership Development Program, and is enrolled in the Graduate School of Banking at the University of Wisconsin. Additionally Denton has achieved the rank of Eagle Scout. Erika L. Hall, JD, has joined the Indiana Bankers Association as assistant vice president-government relations. As a member of the IBA Government Relations Team, she will help to analyze political issues, review legislative proposals, build relationships with policymakers, and promote the grassroots lobbying efforts of IBA-member banks. Hall previously was employed by the state of Indiana as deputy legislative director for the Family and Social Services Administration, prior to which she served the Indiana House of Representatives as legislative intern director, senior legislative assistant and legislative assistant. She additionally gained intern experience for the Honorable Magistrate Judge Mark Dinsmore in the U.S. District Court Southern District of Indiana. Active in the community, Hall is a precinct committeeman for Center Township of Marion County and has completed state-level volunteer campaign work. She is a graduate of Indiana University and of the I.U. Robert H. McKinney School of Law. t Dax Denton has been promoted to senior vice presidentgovernment relations of the Indiana Bankers Association. He joined the IBA in 2008 as assistant vice president-government relations and was promoted in 2012 to vice president-government relations. Previously Denton managed state relations for the Indiana Statewide Association of Rural Electric Cooperatives, prior to which he was deputy legislative director of the Association of Indiana Counties and legislative intern with BoseTreacy Associates LLC. Denton serves the Governmental Affairs Society of Indiana as a member of the board of governors and chairman of the membership committee. A former co-chair of the government relations committee of the Indiana Society IBA Staff Announcements: GRTeam Promotion and New Hire
CALENDAR UPDATE Calendar of events Register online at indianabankers.org/education-events The IBA Center for Professional Development is located at 6925 Parkdale Place, Indianapolis, IN 46254 Phone: 317-387-9380 Twitter: @IndianaBankers Alternative Delivery Channels … Available at your convenience via Webinar, CD-ROM or On-Demand Chief Financial Officer Forum June 14 - Group 1 – IBA Center June 17 - Group 2 – IBA Center Senior Lender Forum June 15 - Group 1 – IBA Center June 16 - Group 2 – IBA Center Consumer and Real Estate Lending Compliance June 15-16 - IBA Center IBA Regional Meetings June 15 - The Columbia Club, Indianapolis June 16 - Cooper’s Hawk Winery and Restaurant, Merrillville June 21 - Biaggi’s Ristorante Italiano, Evansville July 12 - Biaggi’s Ristorante Italiano, Fort Wayne July 26 - Montgomery’s Steakhouse, Spiceland July 27 - Scholars Inn Gourmet Café, Bloomington Aug. 17 - Mountain Jack’s Steakhouse, Lafayette Aug. 18 - Buckhead Mountain Grill, Jeffersonville Same-Day ACH Symposium June 21 - IBA Center Essentials of Banking: Session 2 - Business Operations and Management June 23 - IBA Center IT & Operations Officer Forum June 23 - Group 1 – IBA Center June 24 - Group 2 – IBA Center Marketing Directors Forum June 28 – IBA Center BSA/AML Compliance School June 28-29 – IBA Center FHA and USDA Underwriting Training June 29-30 - IBA Center Auditing Regulation Z July 12 – IBA Center Human Resources Directors Forum July 12 - IBA Center Analyzing Tax Returns in SelfEmployed and Small Business Situations July 13 – IBA Center BuildingYour Incident Response Program July 14 - IBA Center Analyzing C&I Business Cash Flow July 14 – IBA Center Fair Lending Review and Update July 18 - IBA Center Principles of Loan Documentation July 19 - IBA Center Universal Banker Skills July 19 - IBA Center Advanced Loan Documentation July 20 - IBA Center Community Bankers for Compliance Series: Session 3 Aug. 8 - The Landmark Conference & Reception Centre, Fort Wayne Aug. 9 - IBA Center Aug. 10 - IBA Center Annual Directors Workshop Aug. 15 - The Landmark Conference & Reception Centre, Fort Wayne Aug. 16 - Wooded Glen Retreat & Conference Center, Henryville Aug. 17 - IBA Center Branch Management Series: Session 3 - Leading, Developing and Engaging the Team Aug. 23 - IBA Center IBA Leadership Development Program: Session 3 - Limitations Are Self-Imposed Aug. 24-26 - Wooded Glen Retreat & Conference Center, Henryville Essentials of Banking: Session 3 - Safeguarding the Bank and Customer Service Aug. 25 - IBA Center Senior Retail Banking Forum Sept. 7 - IBA Center Advanced Credit Analysis School Sept. 8-9 - IBA Center Advanced Ag Lenders Workshop Sept. 8-9 - Courtyard by Marriott, West Lafayette IBA Annual Convention Sept. 11-13 - French Lick Springs Hotel Risk Management Officer Forum Sept. 15 - IBA Center Deposit Account Administration Sept. 15 - IBA Center In-Bank Training: How to Train Staff Using Bank Policies, Procedures, Forms and Disclosures Sept. 16 - IBA Center Mortgage Lending School Sept. 20-22 - IBA Center IBA Annual Washington Trip Sept. 25-27 – Washington, D.C. Annual Security Management Seminar Sept. 27 - IBA Center Appraisal and Evaluation Compliance Reviews Sept. 27 - IBA Center CBC Compliance School - Lending Compliance Module Oct. 3-6 - IBA Center Essentials of Banking: Session 4 - Lending, Bank Investments and Bank Performance Oct. 4 - IBA Center Internal Audit and Risk Management School Oct. 11-12 - IBA Center Chief Financial Officer Forum Oct. 11 - Group 1 - IBA Center Oct. 14 - Group 2 - IBA Center Senior Lender Forum Oct. 12- Group 1 - IBA Center Oct. 13- Group 2 - IBA Center Cybersecurity Conference Oct. 13-14 - Renaissance Indianapolis North Hotel, Carmel Marketing Directors Forum Oct. 18 - IBA Center IRA Essentials Oct. 18 - IBA Center Advanced IRAs Oct. 19 - IBA Center Social Strategy Workshop Oct. 19 - IBA Center BSA/AML Compliance Management Oct. 20 - IBA Center Lenders Comprehensive Guide to Mortgage Lending Oct. 25-26 - IBA Center IBA Leadership Development Program - Session 4:Who Dares Wins Oct. 26-28 - Wooded Glen Retreat & Conference Center, Henryville IT and Operations Officer Forum Oct. 27 - Group 1 - IBA Center Oct. 28 - Group 2 - IBA Center Community Bankers for Compliance School - Deposit and Operations Nov. 2-3 - IBA Center IBA Future Leadership Division Annual Conference Nov. 2-3 - Renaissance Indianapolis North Hotel, Carmel ImplementingThe New HMDA Rules Nov. 7 - IBA Center June 14 - How to Analyze the Purchase of an Existing Business June 14 - ACH Rules for Deceased Accountholders and Federal Government Payments June 15 - Comparing Regulation E Requirements With Visa and MasterCard Rules June 16 - Loan Servicing Risks, Controls and Common Pitfalls June 16 - Credit Administration in Commercial Banks: Seven Effective Habits June 16 - SSNs, EINs, and ITINs: Understanding our Job as a Withholding Agent June 21 - HR Series: Compliance and Legal Issues in Employee Screening Pre- and Post-Hire June 21 - Checks and Deposits - Vital Issues June 21 - TILA-RESPA Integrated Disclosure (TRID) Rule: Fallout From Implementation June 22 - Cybersecurity and FFEIC Regulatory Expectations June 23 - Lending to Municipalities June 23 - Regulator Guidance of HVCRE: Issues, FAQs and Clarification of Basel III Standards June 23 - Preparing Call Report Basic Lending Schedules: Coding, Classifications and Loan Loss Allowance June 28 - Skills and Tools for Improving Teller Performance June 28 - Handling Social Security Representative Payee Accounts June 28 - HMDA:A Summary of the New Final Rules June 29 - Compliance Officer Training: Risk Assessments, Monitoring and Testing June 30 - Understanding FCRA Permissible Purposes in Obtaining Credit Reports July 6 - Garnishment of Federal Benefit Payments July 6 - Attracting and Retaining Key Management July 7 - Entering the World of Consumer Loans - Part 1 July 7 - Treasury Services: New Delivery and Service Models for Cash Management July 12 - Privacy Notices Compliance: Content and Delivery July 12 - Call Center Training July 12 - Alert! Implementing New Customer Due Diligence Rules - Legal Entity Customers - Part 1 July 12 - Modifying Existing Product Terms and Fees:Timing, Content and Requirements for Change-in-Term Notices July 13 - Current Hot Issues in Financial Accounting for Community Banks July 13 - Email Security - Oops,You Clicked; Now What? July 13 - Developing a Star Teller - Personal and Technical Skills July 14 - Board Oversight and Responsibility for ACH Risk 7 Hoosier Banker June 2016
8 Hoosier Banker June 2016 COVER STORY Mega Impact” was the appropriately named theme of the 2016 Indiana Bankers Association Mega Conference. This year’s event, the 25th anniversary of the IBA Mega Conference, drew a record crowd of nearly 1,350 attendees. Events took place May 3-5 at the Indiana Convention Center and JW Marriott Indianapolis, kicking off with a golf outing on Tuesday, May 3, at the famed Brickyard Crossing Golf Course in Indianapolis. Congratulations to the winning golf team: Tony Gambaiani of Jackson County Bank, Seymour; Jared Houser and Jim Rush of United Bank, Evansville; and Jeff Niesen of Bankers’ Bank, Madison, Wisconsin. Also thank you to the IBA Future Leadership Division for selling mulligans at the outing to help raise BANKPAC funds. On Tuesday following the golf outing, the IBA hosted an associate members appreciation reception at the JW Marriott. This annual event presents an opportunity to recognize the support of the service providers who connect with the Indiana banking community as IBA associate members. On Wednesday morning, May 4, the first of two days of educational offerings began with concurrent tracks covering the topics of Directors, Human Resources, Retail Banking, Risk Management, Sales & Customer Service, and Trust. Also that day, the luncheon keynote speaker was legendary Coach Bobby Knight, who offered insights into leadership and character. Additionally on Wednesday, the luncheon provided recognition of IBA Five-Star Member banks and Diamond Award associate members. Later that afternoon, Mega festivities continued with the traditional Mega Celebration, held in the exhibit hall. That evening, members and prospective members of the Future Leadership Division gathered for a reception, while other Mega attendees explored the variety of dining options in downtown Indianapolis. The final day of Mega, Thursday, May 5, resumed with educational sessions on Business Lending, Compliance, Financial Management, Marketing, Operations & Technology, and Strategic Thinking. Thursday’s luncheon keynote, Dave SanderMega Impact of the 2016 IBA Mega Conference About the Author Christina M. Bennett, CMP, is vice president-meetings & events of the Indiana Bankers Association. She can be reached at 317-387-9380, email: cbennett@ indianabankers.org. son, inspired the audience with his recount of the courageous “Miracle on the Hudson” emergency plane landing in 2009. The luncheon on Thursday also showcased the best of Indiana bank marketing through the presentation of the IBA Maxi Awards. Thank you to all the planners, sponsors, attendees and others who helped to make the 2016 IBA Mega Conference an impactful success. We look forward to hosting you again at next year’s Mega, scheduled for May 2-4, 2017, at the Indiana Convention Center. t Select photos from the 2016 IBA Mega Conference are available on pages 10-12. To view all Mega photos, click on the photo dates below in Hoosier Banker Digital at indianabankers.org: • Day 1 - May 3, 2016 • Day 2 - May 4, 2016 • Day 3 - May 5, 2016 IBA Mega Conference Photos IMPACT MEGA
9 Hoosier Banker June 2016 IMPACT MEGA Mega Sponsors Agresta, Storms & O’Leary PC Allied Solutions Anthem Blue Cross Blue Shield ATM Solutions The Baker Group Bank Compensation Consulting Bankers’ Bank Bingham Greenebaum Doll LLP BITS Network BKD, LLP Blackwell, Burke & Ramsey PC BMO Harris Bank Bose, McKinney & Evans LLP Cinnaire Corporation CliftonLarsonAllen Crowe Horwath LLP CSI Deluxe Corp. Equias Alliance Executive Benefits Network Farmer Mac Federal Home Loan Bank of Indianapolis Federated Floodplain Consultants Franklin American Mortgage Company Graduate School of Banking, University of Wisconsin IBA Group Insurance Trust IBA Insurance Agency Inc. Investors Title Insurance Company K4 Architecture + Design Keefe, Bruyette & Woods The KeyState Companies Kilpatrick Townsend & Stockton LLP Lee & Mason Financial Services Matrix Integration PCBB Plante Moran Professional Bank Services Inc. Profit Resources Inc. Renninger & Associates LLC Robert Steele Agency Inc. RSM US LLP SESCO Group Inc. The SHAZAM Network Simplifile SmithAmundsen LLC Title Center of Indiana LLC Travelers Virtual Innovation Inc. Voluforms Wilmington Trust NA Works24 Young & Associates Inc. Maxi Award Winners Annual Report Lake City Bank, Warsaw Springs Valley Bank & Trust Company, French Lick Branding Campaign The Farmers State Bank, Brookston STAR Bank, Fort Wayne Deposit Campaign The La Porte Savings Bank Security Federal Savings Bank, Logansport Digital Content Alliance Bank, Francesville Home Bank, Martinsville Loan Campaign STAR Bank, Fort Wayne West End Bank, Richmond Public Relations Garrett State Bank Greenfield Banking Company Series First Bank Richmond, NA iAB Financial Bank, Fort Wayne Single Piece Alliance Bank, Francesville Lake City Bank, Warsaw BEST OF SHOW First Bank Richmond, NA Five Star Members Alliance Bank, Francesville Bank of Geneva Bank of Wolcott Bath State Bank Bippus State Bank, Huntington Commerce Bank, Evansville Community First Bank of Indiana, Kokomo Community State Bank, Royal Center Crossroads Bank, Wabash Farmers and Merchants Bank, Laotto The Farmers Bank, Frankfort The Farmers State Bank, Brookston Farmers State Bank, LaGrange Farmers State Bank, Mentone First Bank of Berne First Bank Richmond, NA Diamond Associate Members The Baker Group Bankers’ Bank Bose, McKinney & Evans LLP Cinnaire Corporation Equias Alliance Federal Home Loan Bank of Indianapolis Infotex The KeyState Companies Krieg DeVault LLP Plante Moran Renninger & Associates LLC The SHAZAM Network SmithAmundsen LLC Wilmington Trust NA First Farmers Bank and Trust Company, Converse First Federal Savings Bank, Evansville First Federal Savings Bank, Huntington First Federal Savings Bank, Rochester The First National Bank of Odon First Savings Bank, Clarksville The Fountain Trust Company, Covington Garrett State Bank German American, Jasper Greenfield Banking Company Hendricks County Bank & Trust Company, Brownsburg Home Bank, Martinsville Hoosier Heartland State Bank, Crawfordsville iAB Financial Bank, Fort Wayne Jackson County Bank, Seymour Kentland Bank Logansport Savings Bank Mutual Savings Bank, Franklin The New Washington State Bank, Charlestown North Salem State Bank Our Community Bank, Spencer River Valley Financial Bank, Madison Security Federal Savings Bank, Logansport Springs Valley Bank & Trust Company, French Lick STAR Bank, Fort Wayne Wayne Bank and Trust Company, Cambridge City Your Community Bank, New Albany
10 Hoosier Banker June 2016 2016 MEGA CONFERENCE PHOTO GALLERY IMPACT MEGA
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12 Hoosier Banker June 2016 IMPACT MEGA 2016 MEGA CONFERENCE PHOTO GALLERY
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14 Hoosier Banker June 2016 The 1960s began with buoyant optimism, flush with the prosperity of the previous decade, yet yearning for a “new frontier,” as coined by America’s youngest commander-in-chief, President John F. Kennedy. Within the span of 10 years, the nation would experience sweeping advancements in civil rights, medicine, education, job training and the sciences. By 1969 the American frontier had stretched literally to the moon, when Purdue graduate Neil Armstrong laid the first human footprint on the lunar surface. The 1960s also marked a loss of 1916 - 2016 YEARS HOOSIER BANKER HERITAGE: 1960-1969 innocence. JFK was assassinated on Nov. 22, 1963; only five years later, his brother, Sen. Robert F. Kennedy, also was gunned down, less than two months after the assassination of Martin Luther King Jr. The loss of Dr. King was traumatizing for the emerging civil rights movement, beset with struggles against deeprooted resistance. Disillusionment also resulted from countercultural experimentation, at times giving way to substance abuse and drug overdoses, including those of young celebrities. And certainly the Vietnam War had a powerful impact on the decade, televising the horrors of armed conflict into the American psyche. If fashion mimics identity, the pronounced contrasts from the start of the 1960s to the end underscored seismic cultural shifts in mores, lifestyles and values. Within a few years, the neatly coiffed hair and classic clothing of the early ’60s had exploded into psychedelic colors and “down-to-there hair,” as expressed in a hit Broadway musical. Yet the decade had its lasting victories, woven into and around the swirling events and dramas that define it. Through it all, the banking community continued to serve its customers, rising to the challenges of an early-decade recession and latedecade inflation. Industry milestone events include passage of the Bank Protection Act, the Truth in Lending Act and the Fair Housing Act. The decade also saw the conversion of Fannie Mae into a publicly traded governmentsponsored enterprise. A technological breakthrough in banking came in 1969, when Chemical Bank in Rockville Center, New York, advertised: “On Sept. 2, our bank will open at 9:00 and never close again.” The bank had installed the first U.S. automated teller machine. t 1960 Mary Kay Kurker,American Fletcher National Bank and Trust Company, Indianapolis, wore a skirt depicting magnetic ink characters at a demonstration of the bank’s new IBM reader-sorter. 1961 A total of 4,500 visitors attended the grand opening of the auto bank branch of First National Bank of Elkhart. 1962 Clean lines were the focus in the newly remodeled lobby of Citizens Bank, Michigan City.
15 Hoosier Banker June 2016 An organization called the Foundation for Full Bank Services ran a full-page ad to promote a series of television specials that it was sponsoring. 1968 G. Earl Brown, bank vice president, and Mary Richwine, public relations director, wrap up a notification mailing of 10,000 letters to announce the name change of Speedway State Bank to First Bank and Trust Company. 1963 Birch E. Bayh Jr., then serving as a U.S. senator, was a featured speaker at the 1967 Indiana Bankers Association Annual Convention. 1967 Marcella Clary, assistant cashier and manager of the savings department of Gary National Bank, displays troll doll banks.The bank sold nearly 1,000 of the doll banks within two months. 1964 Presiding over the 1965 Indiana Bankers Association Annual Convention was the late Burr S. Swezey Jr. of Lafayette, then acting as IBA president. 1965 An artist’s rendition portrays the forthcoming Indiana National Bank building.The building would be Indiana’s tallest upon completion. 1966 Merchants National Bank of Muncie celebrated its milestone of reaching $100 million in resources by displaying “Thanks a million” posters, as shown by bank employees (left to right): Carmen J.Treinen, Clara L. Kear, Doris Alexander and Nancy Jennings. 1969
16 Hoosier Banker June 2016 FEATURE Each April marks Financial Literacy Month throughout the United States, when financial professionals and community advocates make additional efforts to help educate consumers about financial basics. Events related to Financial Literacy Month include Indiana Money Smart Week, created by the Federal Reserve Bank of Chicago; Teach Children to Save Day, sponsored by the American Bankers Association Community Engagement Foundation; and Community Banking Month, designated by the Independent Community Bankers of America. The Indiana Bankers Association recently contacted member banks about their financial literacy efforts during the month of April and received responses from 22 banks, representing 20 percent of IBA bank membership. Going forward, the IBA plans to collect this information each year following April Financial Literacy Month. Survey results are shown in the infographic on page 18, representative responses from the following banks: 1st Source Bank, South Bend Bank of Wolcott Bath State Bank BloomBank, Bloomfield Centier Bank, Northern Indiana DeMotte State Bank Fifth Third Bank, Indianapolis First Bank Richmond, NA First Merchants Bank, Muncie First Savings Bank, Clarksville The Fountain Trust Company, Covington Garrett State Bank German American, Jasper iAB Financial Bank, Fort Wayne Lake City Bank, Warsaw Logansport Savings Bank MutualBank, Muncie Our Community Bank, Spencer Peoples Bank, Munster Terre Haute Savings Bank West End Bank, Richmond Your Community Bank, New Albany Following are some examples of Financial Literacy Month outreach from the Indiana banking community: 1st Source Bank, South Bend, employees gave financial literacy presentations in local schools. In Fort Wayne, the bank additionally participated in Money Smart presentations, leading a discussion on how to decrease debt. The bank also distributed materials from its Fort Wayne area banking centers. Bath State Bank employees volunteered in 17 classrooms to account for 84 presentations for Junior Achievement. Classrooms ranged from kindergarten through high school. In addition, at the request of area teachers, the bank made all-day presentations on the importance of savings and the economy to sixth- and 10thgrade students. The bank also helped operate a Reality Day for 10th-grade students and educated FFA students about credit scores and reports, savings and checking accounts, and agribusiness for a total of 103 presentations to 869 students in the month of April. BloomBank, Bloomfield, was represented by Betty Apple Rush, bank senior vice president and chief financial officer, who visited Bloomfield Elementary School on April 29 to present financial lessons to each of the first-grade classes. She read a story about a character named Silly Sam, discussed safe and unsafe places to store money, taught about coins and counting, and engaged the children in a drawing activity related to savings. Rush also presented each child with a coin bag containing a penny, nickel, dime and quarter as an incentive to start saving. This year marked 20 years of the bank’s outreach program. Centier Bank, Northern Indiana, participated in the Northwest Indiana Money Smart Week GeoCache for College Cash. The bank’s Money Smart Week Council donated $1,000 to a winning student at Indiana University Northwest and $500 to each of the Ivy Tech Northwest Indiana campuses for a winning student. In addition bank April 2016 Survey Results: Financial Literacy Month Bath State Bank president/CEO George Ferriell welcomes College Corner Union School fourth-grade students on their two-hour annual field trip to the bank to learn about the importance of saving, interest, route of a check and history of money. Betty Apple Rush, senior vice president and chief financial officer with BloomBank, Bloomfield, is pictured with students from Bloomfield Elementary School on April 29.
17 Hoosier Banker June 2016 company the book reading, the bank supplied firstgraders with three cups to start their own personal programs of financial management and charity. Lake City Bank, Warsaw, organized the Lake City Bank Reality Store program to provide students with an opportunity to budget household expenses based on various incomes, from low-income to high-income professions, as well as number of household members. The experience helps students learn the difference between wants and needs. MutualBank, Muncie, participates in TeenWorks, which is linked to the 21st Century Scholar program and begins in the month of April. TeenWorks helps young adults and students with a variety of life skills, including financial literacy. Students go through several learning stages throughout the program, which include securing employment during the summer. Participants open checking accounts to deposit their paychecks after first attending a financial literacy course. Bank employees assist with financial questions and teach classes to students about the importance of financial well-being and saving. Our Community Bank, Spencer, conducted a Teach a Child to Save Day bank tour for 90 first-graders from Spencer Elementary School. Students visited the bank president’s office, the vault area, safe deposit box area and the teller area, including the drive-thru. They were shown how to use machines in the teller area and were treated to story time, during which they were read a book about saving money. At the end of the tour, each child was given cookies and a bag full of goodies. Additionally the bank runs a feature called Fiscal Fitness in the Spencer Evening World. Continued on page 18. personnel appeared on a local television program, WNIT Economic Outlook, to discuss finances, plus the bank participated in financial literacy presentations with Bank on Northwest Indiana, the secretary of state’s office and the Indiana attorney general’s office. Fifth Third Bank, Indianapolis, presented the Link Up to Empower U Conference. The seminar was designed to educate and empower women who are further along in their financial journey and need more sophisticated financial strategies related to wealth management. The Empower U® sessions were presented by representatives from Fifth Third Securities and Fifth Third Bank, and topics included: insurance planning, investments, retirement planning and estate planning. First Bank Richmond, NA, participated in Smart Money Day on April 26 at Reid Health. The event featured a video and panel discussion with speakers from the Wayne County sheriff’s department, Indiana attorney general’s office, Social Security office and Area 9 Agency on Aging. More than 45 senior citizens attended. First Savings Bank, Clarksville, reached 265 high school students at Corydon Central High School, when branch manager Tony Myers taught students about financial literacy and the importance of credit. He reported an enthusiastic response from students. Garrett State Bank presented a banking literacy program to all area first-graders. Employees from the bank read Three Cups, a children’s book, which “teaches children from an early age the rewards of practicing a timeless, unique and effective method of personal financial management and charity.” The bank has ensured that each classroom has a couple of copies of the book to permit students to borrow a copy to take home for reading with family. To acMary Shelton (left) and Samantha Fowler, associates of Centier Bank, Northern Indiana, conducting a “Keep It Safe” presentation during Money Smart Week. Participants of the Link Up to Empower U Conference are pictured.The conference was presented by Fifth Third Bank, Indianapolis. Mary Hall, teller, Garrett State Bank, reads the book Three Cups to children to first-grade Kurt Rosenberger, president and CEO of Our Community Bank, Spencer, welcomes elementary school students into his office as they enjoy a tour of the bank.
18 Hoosier Banker June 2016 Continued from page 17. West End Bank, Richmond, partners with Richmond Community Schools through the We R Savers program to promote financial responsibility through student-operated banks and in-class financial literacy sessions. The bank sponsors and chaperones a student-operated bank at each elementary school once a month; each bank is operated by fourthgraders selected through an application process. Additionally all Richmond Community School students are eligible for high-yield saving accounts, which may be opened with a deposit as small as $1. West End Bank also offers financial literacy sessions at six elementary schools and Richmond High School. Indiana Financial Literacy Month Outreach,April 2016 Results represent a sampling of 22 IBA-member banks: Richmond Community School students are pictured holding their books, Give Save Spend with The Three Little Pigs that were purchased and presented by West End Bank, Richmond. Your Community Bank, New Albany, hosted a Dollars & Sense Bright Idea Contest for eighth-grade students at Scottsburg High School, with the finals being held on April 15. Classroom teaching from bank employees and community leaders took place prior to the presentations. A preliminary competition was held to narrow the field. The students presented business plans to explain their concepts; each team consisted of two to four students. The top teams received a cash prize to be split among team members, and each student who participated in the preliminary round received credit toward their social studies grades, plus a pizza party reward. t Scottsburg High School student participants are pictured during the Dollars & Sense Bright Idea Contest hosted by Your Community Bank, New Albany. 6,104 Number of children (age 18 or younger) reached through financial literacy efforts 289 Number of bank associates who helped with financial literacy projects 380 Number of financial literacy presentations made by banks 917 Number of adults were reached through financial literacy efforts William Curl, regional lending manager – 30 years of service. Patrick Botts, president, chief operations officer – 30 years of service. Rosa Gullett, facilities specialist – 20 years of service.t AnniversAry Milestones A salute to bankers with 20+ years of service MutualBank, Muncie, announces the following anniversaries of employees with 20 or more years of service with the bank as of June:
20 Hoosier Banker June 2016 FLD HAPPENINGS About the Author Dax Denton is senior vice president-government relations of the Indiana Bankers Association. He can be reached at 317-917-8047, email: ddenton@indianabankers.org. The Indiana Bankers Association Future Leadership Division gained momentum at the 2016 IBA Mega Conference by convening members and prospective members at a networking reception and by hosting an appreciation dinner for members of the FLD board of directors.* Both events took place the evening of May 4. The networking reception, sponsored by Krieg DeVault LLP, took place at Loughmiller’s Eatery, located across from the Statehouse. A longtime favorite of legislators and political pundits, the location underscored the grassroots engagement of FLD members, representing part of its mission in developing future leaders. The event drew about 25 attendees. Following the networking reception, FLD board members in attendance walked to Spoke & Steele, a downtown Indianapolis restaurant, for an appreciation dinner. Each year during Mega, the IBA hosts a dinner for FLD board members to thank them for their leadership and to deepen board member ties. FLD Builds Momentum at IBA Mega Conference * A listing of Future Leadership Division board members appears on page 4. Panoramic photo provided courtesy of FLD President Kristin Marcuccilli, STAR Bank, Fort Wayne. This annual gathering in a relaxed setting consistently results in lively conversation and creative ideasharing. Among ideas discussed by FLD board members were plans for upcoming events. In September, the FLD will again host a silent auction for Indiana BANKPAC fundraising at the IBA Annual Convention. Later this fall, the FLD will present its third annual conference, to be held Nov. 2-3 at the Renaissance Indianapolis North Hotel in Carmel. For more information about how you or an emerging leader in your bank can become involved with the IBA Future Leadership Division, please contact me at 317-917-8047, email: ddenton@indianabankers.org. Additional information is available online at indianabankers.org/futureleadership-division. t
21 Hoosier Banker June 2016 IBA FUTURE LEADERSHIP DIVISION AT MEGA 2016
22 Hoosier Banker June 2016 COMPLIANCE CONNECTION Question No. 1: Does Indiana law limit how much a bank can lend to one borrower, or to a group of associated borrowers, at a time? Answer: Yes, although the calculation of these limits will vary, based on the nature of the credit and collateral involved. As a general rule, Indiana law provides that the total loans and extensions of credit by a bank to a person outstanding at one time not fully secured by collateral having a market value at least equal to the amount of the loan or extension of credit may not exceed 15 percent of the unimpaired capital and unimpaired surplus of the bank.1 Loans and extensions of credit fully secured by readily marketable collateral with a market value at least equal to the amount of the funds outstanding may account for an additional 10 percent of the unimpaired capital and unimpaired surplus of the bank.2 Question No. 2: How do I calculate loan limits under Indiana law when a borrower has personal loans in his or her name, and then business loans with other individuals? Answer: Calculation of loan limits with multiple parties involved can be complex, and is not addressed directly in the Indiana code. Rather, Indiana law provides that the Department of Financial Institutions (DFI) may apply the provisions of 12 CFR § 32 (“Part 32”) in the application and administration of the chapter governing loan limits.3 Indiana Code § 28-1-13-13 provides the DFI with general authority to apply the provisions of 12 CFR § 32 in the application and administration of loan limit restrictions under Indiana law, and provides the DFI flexibility to implement the provisions of Part 32 to the fullest extent, including in the event of changes to the federal law. This section of federal law includes the “Combination Rule” regulating the calculation of loan limits when dealing with multiple loans for the same borrower that may also involve other related parties.4 In general terms, the Combination Rule provides that loans or extensions of credit to one borrower will be attributed to another person, and each person will be deemed a borrower for purposes of the loan limit calculation, based on two independent standards referred to as the direct benefits test and the common enterprise test. The direct benefits test provides that the proceeds of a loan or extension of credit to a borrower will be deemed to be used for the direct benefit of another person and will be attributed to the other person when the proceeds, or assets purchased with the proceeds, are transferred to another person, other than in a bona fide arm’s length transaction where the proceeds are used to acquire property, goods or services.5 The common enterprise test provides that a common enterprise exists, and loans to separate borrowers will be aggregated when either the expected source of repayment for each loan or extension of credit is the same for each borrower, and nei- © 2016 Krieg DeVault LLP THINKING BEYOND TRADITIONAL SOLUTIONS FOR FINANCIAL INSTITUTIONS FOR OVER 130 YEARS w Corporate Representation w Mergers and Acquisitions w Capital Offerings w Regulatory w Compliance w Supervision and Enforcement w New Product Development w Litigation w Commercial / Consumer Loan w Creditors’ Rights w Trust w Tax w Securities w Employment w Intellectual Property One Indiana Square Suite 2800 Indianapolis, Indiana 46204 p: 317.636.4341 INDIANA ILLINOIS GEORGIA FLORIDA MINNESOTA www.kriegdevault.com This may constitute advertising material in some jurisdictions. The content provided herein is for information purposes only.
23 Hoosier Banker June 2016 About Compliance Connection In order to address compliance inquiries from members, the IBA provides Compliance Connection, an assistance program offering advice on Indianaspecific compliance questions. If the matter requires legal advice, IBA Compliance Connection will refer the bank to a law firm. Acting as IBA’s compliance counsel is Brett J. Ashton, partner with Krieg DeVault LLP, Indianapolis, and chair of the firm’s financial institutions practice group. Submit Compliance Connection questions to IBA’s Amber R. Van Til at avantil@ indianabankers.org or Josh Myers at jmyers@indianabankers.org. ther borrower has another source of income from which the loan (together with the borrower’s other obligations) may be fully repaid, or when loans or extensions of credit are made to borrowers who are related directly or indirectly through common control, including where one borrower is directly or indirectly controlled by another borrower and substantial financial interdependence exists between or among the borrowers. A common enterprise is also present when separate persons borrow from a national bank or savings association to acquire a business enterprise of which those borrowers will own more than 50 percent of the voting securities or voting interests.6 Additional standards apply for interpretation of the common enterprise test with respect to partnerships, joint ventures and associations.7 The DFI has authority to deem the failure of any bank or trust company to comply with the loan limitations provision, or any order related to these limitations, as an indication that the bank is conducting its business in an unauthorized or unsafe manner, and to initiate liquidation proceedings of the institution in accordance with Ind. Code § 28-13.1. It should be noted that the DFI has indicated that it attempts to maintain consistency between state lending limits and those applicable to national banks under 12 CFR § 32. t 1 Ind. Code § 28-1-13-1.5(a) 2 Ind. Code § 28-1-13-1.5(b) 3 Ind. Code § 28-1-13-13 4 12 CFR § 32.5 5 12 CFR § 32.5(b) 6 12 CFR § 32.5(c) 7 12 CFR § 32.5(e) 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. Your Community Bank, New Albany, held a ribbon-cutting ceremony on April 22 to celebrate the grand opening of its Evansville financial center, located at 727 N. Cross Pointe Blvd., Suite D. Evansville Mayor Lloyd Winnecke and Chamber of Commerce of Southwest Indiana officials were in attendance. In honor of the occasion, the bank donated $1,000 each to Ark Crisis Child Care Center, Boy Scouts of America – Buffalo Trace Region, Junior Achievement of Southwestern Indiana, YMCA of Southwestern Indiana and Youth First Inc. t new BrAnches, Buildings & openings Associates of Your Community Bank, New Albany, celebrate the grand opening of the bank’s new Evansville financial center in April. Investors Title Insurance Company, Chapel Hill, North Carolina, has been ranked as one of the top 25 best-run public companies in North Carolina by the Triangle Business Journal. The rankings are determined by a team of journal researchers and the Kenan Institute of Private Enterprise at the University of North Carolina, Chapel Hill, by evaluating stock return, employee growth, operational efficiency and revenue growth. Welcome, New Member The Indiana Bankers Association welcomes the following company to the IBA network as an associate member. For more information about the benefits of associate membership, please contact Rod Lasley at 317-387-9380, email: rlasley@indianabankers.org. United Bankers’ Bank Tyson Doke, 952-885-9479 ubb.com UBB provides community banks with a robust portfolio of operations, lending, investment and special services. UBB never competes with its customers, and it builds and maintains all customer relationships on a foundation of integrity and trust. t AssociAte MeMBers’ corner
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