The Arkansas Banker June 2018

June 2018

Celebrating

American Housing Month

Volume CI, No. 6

ABA PROFESSIONAL DEVELOPMENT

LIVE EVENTS Providing you with face-to-face interaction with expert instructors!

JULY 2018 Branch Management Series

CyberSecurity Road Show

July 16-17, 2018 | ABA Office, Little Rock Who Should Attend: Supervisors, Retail Managers, and Retail Banking Team Members

CyberSecurity Road Show

July 20, 2018 Legacy National Bank, Springdale Who should attend: Information Security Officers, Compliance Officers, Information Technology Staff, Directors, Presidents, Vice Presidents, Auditors, and Board of Directors.

July 19, 2018 ABA Office, Little Rock Who should attend: Information Security Officers, Compliance Officers, Information Technology Staff, Directors, Presidents, Vice Presidents, Auditors, and Board of Directors.

AUGUST

14 2018 Bank Security Hot Topics 22

Opening New Accounts

13 18

SEPTEMBER ELS Day at the Capitol

Loan Assistants & Processors Workshop

18-19 Supervisor Boot Camp 25-26 Mega Conference

NOVEMBER

More info coming in July!

5-6 Emerging Leaders Conference

13-14 Call Report Preparation

Be watching for details!

For more information about ABA Live Events, log on to www.arkbankers.org or call 501.376.3741.

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OCTOBER

9 Advanced BSA Brush-Up

10 Bank Directors Workshop II 16-17 IRA School TBD Women in Banking Conference

June 2018 COLUMNS

Volume CI, No. 6

President’s Message Chairman’s Column

6

Cathy Owen

5 Minutes with Rhea Williams Millennial Minute with Ever Cuellar

DEPARTMENTS

4

Bill Holmes

CELEBRATING AMERICAN HOUSING MONTH

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9

ABA Past Chairmen Gather in Little Rock

10

Trends in the NW Arkansas Housing Market Present New Opportunities for Bankers

by Jaime Jordan

Professional Development Live Events Webinars 2018 Trust School

2 7 20

Member News

21

Banker News & Moves

22

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14

16

Millennials Lead All Homebuyers

Do HMDA Data Prove Lending Discrimination?

TRID and “Gifts of Equity”

by Julie Stackhouse

by James McGuire

18 The Arkansas Banker Online

Join us at www.arkbankers.org to read and share statewide banking news!

The Arkansas Banker (ISSN 004-1726) is published monthly by the Arkansas Bankers Association, 1220 West Third Street, Little Rock, AR 72201. Phone: 501.376.3741. Periodical postage paid at Little Rock, AR. Postmaster: Send address changes to Arkansas Bankers Association, 1220 West Third Street, Little Rock, AR 72201. Subscription to The Arkansas Banker magazine is included in the membership fees to the Arkansas Bankers Association. Cover price is $5.95 each. Annual subscription rates are $40.00 for members and $60.00 for non-members.

Newly Signed Law Eases Dodd-Frank Mortgage Restrictions on Community Banks

by Nick Arnold & Stuart Hindmarsh

SURVEY SAYS

Random question.

Random bankers.

Interesting results.

How tech-savvy are you?

11%

83%

My kids/grandkids keep me from becoming obsolete on FacePlace or TweetBook

I adapt to change quickly, or at least pretend to

CLICK HERE

1%

I’m sorry, I can’t take this survey on my flip phone

5%

Apple calls me for product testing

to take part in July’s Survey Says!

June 2018

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PRESIDENT’S MESSAGE What S.2155 Means To Our Banks and Communities We wanted to share some of the information on this important new piece of legislation that recently passed in Congress.

What are some of the changes, what do they mean to our banks, what will be some of the implementation timelines? We will try to answer these questions and some specific questions that we have gotten from our banks.

After eight years of hard work, letters written, trips to DC and countless visits with our regulators; all done by bankers across the country and from every size bank, there are some significant changes to come from this bill. By our count there are about three dozen regulatory tasks required by S.2155.

Some of these provisions went into effect as soon as the President signed the bill, others have specific timelines, and yet others have no specified deadline. The regulators will set their own agendas, and we will work with them to get as much relief, as fast as we can. Especially working on those provisions that don’t have a set deadline.

The regulators have been busy already “tailoring” some reg relief for our banks. CRA reform will probably be the biggest reform issue for this year. Bank agencies recently announced that they are no longer enforcing Volcker for banks and holding companies subject to the exemption under the regulatory reform bill. S.2155 generally exempted banks with less than $10 billion in assets from Volcker Rule requirements; the agencies noted in the proposed rule that they “plan to address these statutory amendments through a separate rulemaking process.” The exemption took effect upon signing by the President.

Section 101: Minimum Standards for Residential Mortgage Loans

For our banks with less than $10 billion in assets, all loans held in portfolio will be immediately designated as Qualified Mortgages (QM), subject to some documentations. Most of the loans that we either quit writing, or held as non-QMs were Appendix Q loans. Those were loans that had higher than 43% DTI, or borrowers who had new or seasonal jobs, some selfemployed etc. This new provision will let our banks determine the amount of risk they are willing to take. You will still have to follow other restrictions; e.g. prepayment penalties, points and fee tests, and balloon restrictions.

Bill Holmes | President & CEO Arkansas Bankers Association

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Section 104: HMDA adjustment and study

HMDA disclosure relief is granted for small volume originators.

Banks who have less than 500 mortgages/500 open-end lines of credit for each of the last two years, and a satisfactory CRA rating are immediately exempt from the new DFA HMDA disclosure rules. This is a significant benefit if you are sure you are holding these mortgages in portfolio. If you may sell these loans to FNMA of FHLMC there are still questions about whether they will require the new HMDA data info.

Sections 201: Capital Simplification for Qualifying Community Banks

This provision started as a state bank associations and AmBA push back in 2015. We presented that banks that had high capital bases should not have to jump through all of the new hoops that were being proposed under Basel III. This bill requires regulators to write new regs to implement riskbased capital rules that will exempt those banks with 8-10 percent leveraged capital. We will be making the case to our regulators that 8 percent is sufficient. This would exempt about 98% of the community banks in America.

Section 203: Community Bank Relief

Maybe the simplest provision of the bill: if you are under $10 billion you are no longer required to follow the Volker Rule.

There is further work being done by the regulators to clarify that if you own multiple banks, they will be treated as standalone banks under this provision.

Section 214: Promoting Construction and Development on Main Street

Again, significant changes have been made here. As you know, we always felt that the HVCRE rules captured way too many loans and classified them as high risks. This new section excludes loans where the cash flows generated by real property are sufficient to support debt service coverage.

For example, a loan made to an expanding company to meet the need for additional warehousing. Also this section allows the appreciated value of contributed property to count in the 15 percent borrower-contributed capital requirement. Only those acquisition, development, or construction loans with increased risk are subject to the higher risk weightings.

ABA STAFF Section 401: Enhanced Supervision and Prudential Standards for Certain Bank Holding Companies

As you know we really dislike the arbitrary asset caps in place under DoddFrank. The caps made this section one of the most debated sections of the bill.

After years of discussions, a strong agreement arrived at the fact there are too many banks captured under the DFA requirement for Enhanced Supervision.

Effective immediately bank holding companies under $100 billion are exempt from the Capital-Liquidity Living Will stress tests ordered in DFA. And, the regulators are required to tailor a new approach for bank holding companies between $100 billion and $250 billion. All banks are still under normal regulatory review for safety and soundness.

Some specific questions: Q. How soon can we begin reclassifying Brokered deposits?

A. Immediately, your next call reports will be due in June.

Q. Does S. 2155 remove Balloon restrictions?

A. No. Q. Is the 18-month exam cycle in effect immediately?

A. Yes, but the regulators will have to set their own policies. If you just had a satisfactory exam, ask if they will set the 18 month dates.

Bill Holmes

President & CEO 501.978.3602 bill.holmes@arkbankers.org

Barry Jackson

SVP / Chief Operating Officer 501.978.3613 barry.jackson@arkbankers.org

Carla Brinkley

VP / Controller 501.978.3608 carla.brinkley@arkbankers.org

Kami T. Coleman

VP / Professional Development 501.978.3614 kami.coleman@arkbankers.org

Ava F. Roberts

Q. Is QM status retroactive for loans in my portfolio?

A. Yes, if they meet the other requirements.

VP / Director of Government Relations 501.978.3606 ava.roberts@arkbankers.org

Q. Do we still have to meet ATR requirements?

A. Yes

Traci Logsdon

Q. What happens if we sell a QM loan from our portfolio, does it lose the QM status?

A. If you sell the loan into the market it loses its QM status, unless you sell it to another covered institution (under $10 billion), then it retains QM status.

Jessica Sahene

This bill creates a lot of changes for our banks. It is a great first step that was accomplished with a lot of hard work on your part. Now we need to be focused on what other reforms we can get next year. Join us for our upcoming Washington Visit in October. I am fairly certain we will be spending a lot more time with the OCC, FDIC, Fed Reserve, and CFPB than usual, and a little less time with our delegation this trip. Our focus will be to get the most relief in the quickest timeframe possible.

Director of Communications 501.978.3603 traci.logsdon@arkbankers.org

Marketing Coordinator 501.978.3609 jessica.sahene@arkbankers.org

Brenda Scarbrough

Administrative Assistant 501.978.3607 brenda.scarbrough@arkbankers.org

For a more detailed look at Section I, see the article “Newly Signed Law Eases Dodd-Frank Mortgage Restrictions on Community Banks,� on Page 18.

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CHAIRMAN’S COLUMN Housing and our Communities

ABA OFFICERS

June is American Housing Month and a great month for this designation since it is one of the peak months for homes sales. It also makes it a perfect month to recognize our banks and bankers, as I know of no other industry that does more to help Americans fulfill a dream of home ownership than ours, despite the many regulatory consumer protection compliance requirements placed on the banking industry. Local banks providing access to mortgage loans and affordable housing are vital to the stabilization and growth of communities. Decent, affordable housing is not only important to families, but also essential for the support of our local workforce.

Cathy Owen, Chairman

A local thriving economy is dependent upon the asset building. Housing is one of the largest single factors in building wealth for individual and families. Banks have continually served as a prime resource to help customers determine their best home financing options and are also serve a great resource for educating homebuyers about the various items to take into consideration in purchasing a home. These factors often include, how much is needed for a down payment, saving for a down payment, factoring in all of the costs, improving their credit score, and understanding basic housing terminology.

Another important segment of housing are renters. Home renters and the customers who provide the rental units are also integral to our communities. Renting may be the best option for some of our customers. As bankers, it is our responsibility to help our customers determine their optimal choice for their financial situation and lifestyle. Housing is a basic need. Without stable housing, stress is placed on both the individuals and the community, removing a sense of security and platform for success.

For communities with an aging market, bankers can offer tips to help senior citizens stay in their home as they grow older. Some of these may include considering a reverse mortgage, taking a hard look at their finances, assessing necessary modifications, and preparation for possible emergencies.

A recently released Case-Shiller Report indicated home prices have continued to rise nationally across the country over the past 12 months. The 20-City Composite Home Price Index indicates home prices have been on the rise since 2012. Nationally, sales of existing homes, increasing permits for new construction and low inventories of existing homes for sale are all factors in the rising increase in home prices. Home prices in Arkansas have followed this upward trend, although at a slower pace. The number of homes sold in Arkansas have also followed a clear upward trend during this time frame. Economists are projecting this increase in homes sales to continue throughout the remainder of the year, as long as mortgage rates do not increase too quickly. Although rising home prices and sales are good news, bankers also know that historically the cyclical nature of the housing market is generally followed by bad news in that there will be a point where home prices decline, and mortgage defaults will more than likely increase.

I don’t believe there is any one solution that will solve the basic housing need or lead to housing attainability, but I do not know of any other industry that does more to help our communities and the people who live in them.

Eagle Bank & Trust, Little Rock

Rob Robinson, IV, Chairman-Elect Simmons Bank, El Dorado

Jonathan Harrell, Vice Chairman Generations Bank, Rogers

Jim Cargill, Treasurer Arvest Bank, Little Rock

Dave Dickson, Past Chairman Union Bank & Trust Co., Monticello

Bill Holmes, President & CEO

Arkansas Bankers Association, Little Rock

BOARD OF DIRECTORS Johnny Adams, Conway Craig Attwood, Pine Bluff Jeff Brecklein, Jonesboro Chip Blanchard, Russellville Gene Crawford, Batesville David Dowd, Wynne Don Gibson, Springdale Chris Gosnell, Magnolia David Jessup, DeWitt Lance Lanier, Van Buren Barry Ledbetter, Little Rock Wilson Moore, Little Rock Marnie Oldner, Little Rock Mark Roberts, Malvern Lori Ross, Arkadelphia Randy Scott, Blytheville

Cathy Owen | Chairman

Chairman of Eagle Bank & Trust, Little Rock

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Jason Tennant, Eureka Springs Lynn Wright, Little Rock

ABA PROFESSIONAL DEVELOPMENT

JULY 2018

WEBINARS

Train multiple employees for one price, from the convenient location of your bank!

Monday, July 9

Tuesday, July 17

Tuesday, July 10

Increasing Fee Income without Raising Fees 1:30 p.m. – 2:30 p.m.

Best-Ever Compliance Checklists for Consumer Loans 1:30 p.m. – 3:30 p.m.

Handling Loan Applications – What can go wrong?

10:00 a.m. – 12:00 p.m.

W-9, W-8BEN and W-8BEN-E New Updated Forms and Info 1:30 p.m. – 3:30 p.m.

Wednesday, July 11

Flood Insurance: Compliance Issues 10:00 a.m. – 12:00 p.m.

Thursday, July 12

ATM Cashout Scams 10:00 a.m. – 12:00 p.m.

Business Writing for Financial Professionals 1:30 p.m. – 3:30 p.m.

Monday, July 16

Providing Accurate and Timely Adverse Action Notices 1:30 p.m. – 3:30 p.m.

Dealing with Subpoenas, Summonses, Garnishments, Tax Levies, Etc. 10:00 a.m. – 12:00 p.m.

Wednesday, July 18

Customer Due Diligence & Beneficial Owners: Two Month Checkpoint 10:00 a.m. – 12:00 p.m.

Advanced Commercial Loan Documentation 1:30 p.m. – 3:30 p.m.

Thursday, July 19

Incident Response and Forensics 1:30 p.m. – 3:30 p.m.

Tuesday, July 24

ACH Origination for Lenders and Cash Management 10:00 a.m. – 12:00 p.m.

Tuesday, July 24

Developing a Strong Enterprise-Wide Risk Assessment for Your ERM Program 1:30 p.m. – 3:30 p.m.

Wednesday, July 25

Business Development for All Responsible Parties 1:30 p.m. – 3:30 p.m.

Thursday, July 26

Audit Report Writing 10:00 a.m. – 12:00 p.m.

Alert! New SAR Line By Line 1:30 p.m. – 3:30 p.m.

Auditing Your Bank Secrecy Act Program 1:30 p.m. – 3:30 p.m.

Friday, July 27

Lending to Churches & Other Religious Institutions 10:00 a.m. – 12:00 p.m.

Monday, July 30

Untangling the Web of Fee Disclosures 1:30 p.m. – 3:30 p.m.

For more information about ABA Webinars, log on to www.arkbankers.org or call 501.376.3741.

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5 MINUTES WITH

RHEA WILLIAMS

Vice President, CRCM, Compliance & CRA Officer at First Security Bank in Conway the hours of 7:00 a.m. and 9:00 a.m., be sure and tune in! I also have the privilege of facilitating financial literacy workshops at community centers, libraries, and churches. I have a passion for teaching financial literacy, which was born out of my own struggles as a single parent and then seeing others struggle for lack of knowledge. I tweet financial tips @FSBankRhea, follow me!

Let’s talk home ownership – what advice do you give potential homebuyers? #1 – Check your credit. Make an appointment to see one of our mortgage lenders and they will go over your credit and make suggestions about what the next step could be. Of course, First Security Bank is an Equal Housing Lender. #2 – Engage a Buyer’s agent to help you find a home. Don’t try to negotiate on your own, a buyer’s agent has the skills and knowledge to work on your behalf.

Give us a little background on yourself: I was raised in Malvern, the middle daughter of five girls, which is probably why I talk loud and fast. I have a son, 35, and a daughter, 21 and I’m Nana Rhea to one grandchild.

I started my banking career in 1984 at Malvern National Bank; I started out as a teller and ended at new accounts. I was also a floater and on call for the ATMs when they went down after-hours. I always felt that I would be in the financial services industry in some capacity, because at an early age my grandmother would take me in the back room and let me count her money. The trust that she had in me instilled in me what it meant to be trustworthy and to have integrity.

I moved to Conway in 1988 to attend the University of Central Arkansas; I graduated in 1991 with a Bachelor of Business Administration in Finance. After college, I worked at Telcoe Federal Credit Union, and in 1999 I became employed by what was then First Community Bank in Conway, as a Compliance Officer. I look back and laugh because when I was offered the position, I accepted it without even knowing what a “Compliance Officer” was or did. First Community is now First Security and I’m still there and still a Compliance Officer! I earned my Certified Regulatory Compliance Manager certificate while employed at First Security. I am also the CRA Officer, both positions are rewarding as I am a helper by nature. I get to help the bank and fellow employees comply with consumer regulations and I get to see our bank helping and doing so much good in our communities.

You are the voice of “First Steps Tuesday,” a financial literacy program on KIPR Power 92.3 – what was the inspiration behind that radio show?

The inspiration behind our “First Steps Tuesday” radio show was a way to spread financial literacy to our communities and dispel myths that people have about money, banking, and credit. First Steps Tuesday airs the first Tuesday of every month between

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#3 – Know that owning a home is more than the monthly payment. Budget, save, and be prepared to keep your property well-maintained.

What is the best part of being a hometown banker?

Oh my goodness, seeing our people, at all levels of the organization, get out and about, connecting and giving back to all of the communities that we serve makes my heart swell. We have some amazing stories about the good that my fellow co-workers have done. It is so refreshing to know what a great group of people, that I have the privilege of working with, and the lengths to which they will go to provide 2nd Mile Service. I mean, we Make Better Happen on a daily basis!!!

What TV show character would it be the most fun to trade places with for a week?

I would choose to be Oprah Winfrey for a week so that I could add to the people, countries, and causes that benefit from her philanthropy. And then, I would throw a huge party so that I could meet everyone that I couldn’t meet unless I were Oprah Winfrey.

Rhea with SVP/ Mortgage Lender Mark Rydel, Broadway Joe of Power92 Jams, and Mortgage Lender Ricky Williams.

ABA Past Chairmen Gather in Little Rock Twelve of the ABA’s past banker leaders came together for the annual Past Chairman’s Reception and Dinner on May 10 at The Capital Hotel in downtown Little Rock.

The event, which has been in place for 97 years, brings together a select group of bankers who have served the Association in a leadership capacity.

The group always enjoys lively conversation and camaraderie.

The tenure of attendees spanned from James Kelley, 1991 ABA Chairman, to Vice Chairman Jon Harrell, who will serve in 2020. Though not in attendance, the surviving past chairman with the longest tenure is Joe Hiatt, who served the association in 1979.

1. Past Chairmen Sean Williams, First National Bank of Wynne; Chuck Morgan, Relyance Bank; Robert Taylor, Citizens Bank; and Charlie Blanchard, First State Bank.

ABA Past Chairmen in attendance at the May 10 event were, from left, Larry Kircher (2002), Rob Brothers (2003), I. Joe Miles (2008), John Womack (2007), Larry Wilson (2006), James Kelley (1991), Sean Williams (2016), Chuck Morgan (2014), Robert Taylor (2015), Barnett Grace (1997), John Freeman (2012), and Charlie Blanchard (2011).

1

3

2

2. Sean and Leslie Williams, Joe and Kathryn Miles, and Becky and John Womack.

3. 2018 ABA Chairman Cathy Owen, Eagle Bank, poses with 2008 ABA Chairman Joe Miles, Integrity First Bank.

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4. 2002 ABA Chairman Larry Kircher and former ABA President & CEO Ken Hammonds.

5. ABA Vice Chairman Jon Harrell, Generations Bank, and 2003 ABA Chairman Rob Brothers.

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Trends in the NW Arkansas Housing Market Present New Opportunities for Bankers

by Jaime Jordan Federal Home Loan Bank of Dallas

A recent report on the northwest Arkansas housing market shows housing permits are down year-overyear, but strong demand for housing is presenting the opportunity for community banks to capitalize on this trend.

According to the Skyline Report, a biannual analysis of the latest commercial, single-family residential and multifamily residential property markets in Benton and Washington (Arkansas) counties, the number of residential building permits issued in Benton and Washington counties in the

second half of 2017 is down 12 percent to 1,434 from 1,638 in the second half of 2016.

At the same time, the absorption rate from the past 12 months in both Benton and Washington counties has sharply increased, indicating a 27.3-month supply of remaining lots in active subdivisions in northwest Arkansas.

Lot availability fell 25.2 percent to a 27.3-month supply from the 36.5-month supply at the end of 2016; and dropped 53.5 percent from the 58.7-month supply at the end of 2014.

“The growing scarcity of lots for new home construction, especially in the most desirable areas near amenities,

is becoming worrisome,” said Mervin Jebaraj, lead researcher for the Skyline Report and director of the Center for Business and Economic Research (CBER) at the University of Arkansas. “Put simply, we need more available lots added to the pipeline, or we will begin to experience issues with higher home prices affecting housing affordability in the region.”

The lack of lot availability is troubling to economists because northwest Arkansas is experiencing a population boom.

“The Fayetteville area is one of the fastest growing areas in the country,” said Lawrence Yun, chief economist for the National Association of Realtors.

“So, when one looks at, for example, the job numbers, the job growth that has occurred over the past decade, or even from the year 2000, is quite spectacular – much ahead of the rest of the country.

Naturally there will be more people needing housing. So, there should be home construction matching up with the increases in jobs.”

Two key aspects that have contributed to the decline in lot development, said Mr. Yun, are funding from community banks for land development loans and zoning approval of the developments by city or county commissioners.

Local bankers seem to agree with both points and that they are factors that have contributed to construction delays.

“In every city, the zoning boards have gotten more restrictive than before,” said Mike Hughes, executive vice president and chief credit administration officer

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for Signature Bank in Fayetteville Arkansas.

Gary Head, chairman and CEO of Signature Bank has seen the resulting impact, as well.

“If a developer came in today and bought a tract of land, it might be a year or year and a half before the developer could get a bulldozer on it,” said Mr. Head.

Mr. Jebaraj said there are plans to combat this trend.

“There are regional efforts underway to address the shortage of lots of home construction – both single family and multifamily,” he said. “These efforts will concentrate on increasing the lots available by changing zoning laws in the core of the four major cities in northwest Arkansas.”

Additionally, because of regulatory requirements and previous housing cycles, banks have become more stringent in providing construction loans.

Despite the decline in lot availability, the number of homes under construction in northwest Arkansas rose 9.7 percent in the last half of 2017 to 1,030 compared to the same period in 2016.

“The increase in number of homes under construction over the past five years or so is what contributed to the decline in the number of empty lots,” said Mr. Jebaraj. “In our most recent readings from 2017, we can see that the number of lots continues to decline while the pace of construction is slowing, reflecting the shortage in inventory of lots.”

Many banks are positioning themselves to meet the growing demand for housing in the region.

Chambers Bank, based in Danville, Arkansas, is in the process of reestablishing its Secondary Mortgage Department. The mortgage division, housed at Chambers Bank’s newest location at 4201 West New Hope Road in Rogers, opened on June 4. And, as mortgage demand grows, the bank plans to add staff to other locations.

“Reentering the secondary mortgage market represents our commitment to becoming a comprehensive community bank that serves both consumer and commercial customers well,” says Chambers Bank President Mike Donnell. “As the population of northwest Arkansas has continued to

Continued on page 12

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bill, opening the door for smaller homebuilders to get back in the game, said Mr. Yu.

Continued from page 11

rise, the average price of a home in Benton and Washington counties has increased nearly $50,000 since 2012 – an indication of the expanded need for secondary mortgage options in northwest Arkansas.”

According to Mr. Yu, in the current housing shortage environment, purchasing land to build homes would be much less risky than other circumstances and therefore the process of a community bank providing loans to purchase land and develop lots where

Another key to combatting the lot shortage occurred last month when Congress passed a deregulation

builders can start building homes would carry less regulatory burden.

“In my view, the changes in DoddFrank legislation will hopefully permit more land development loans and subsequently more lot availability because we need more lots and consequently more homebuilding,” he said.

MILLENNIAL MINUTE

EVER CUELLAR

Bank

Legacy National Bank, Springdale Position

AVP, Mortgage Originator How Long Have You Been with Legacy National Bank?

2 1/2 Years Family

Wife Shelby, baby girl Amelia, & Rebar the dog

You are a bi-lingual banker – describe the impact that has for both the bank and your community.

Growing up in a household where Spanish was the only language spoken, I have experienced and understand the challenges facing the Latino community. Most families have someone that is bi-lingual in the family or speak English themselves, but when it comes to banking and business terms, they have a harder time navigating through the complexities of the transactions. Words and terms don’t always translate very well and missing or misunderstanding parts of the transaction leads to frustration and ultimately unhappy customers. Being bi-lingual helps me assist customers overcome that challenge and makes the process of obtaining a loan more comfortable and more ethical from a banker’s perspective. The Latino community is strong and very successful in the Northwest Arkansas area and I love seeing the smiling faces of new homeowners.

More than 1/3 of home purchases in the past year were made by Millennials.

What is the most common question your younger mortgage customers ask?

When we think Millennials, electronic is a word that is almost synonymous with the generation. In a world of e-everything, the question that comes up frequently is, “Why is it better to use a bank instead of an online lender?” At Legacy National Bank we pride ourselves in our customer service. We truly care that our customers understand the terms of their loans fully and we have real local experiences to share with you to make the best choice for you and your family!

At the end of the day, this is one of the biggest purchases of your life…

Wouldn’t it be nice to go to closing feeling confident that you understand the transaction and have a lender that is on your side?

What weird food combinations do you really enjoy?

Being from El Salvador this dish is normal, but you won’t find it everywhere! Sliced plantains fried in a skillet, beautifully served with a sweet thick cream and a side of refried beans.

Simply the best!

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Do Home Mortgage Disclosure Act Data Prove Lending Discrimination?

by Julie Stackhouse Federal Reserve Bank of St. Louis

Note: This article is part of a series titled “Supervising Our Nation’s Financial Institutions.”

In my January 2018 blog post, I addressed the challenges and opportunities of the Community Reinvestment Act (CRA). As part of that post, I referenced several laws that complement the CRA in promoting “fair lending,” including the 1974 Equal Credit Opportunity Act (ECOA) and the 1968 Fair Housing Act (FHA).

CRA COMPLEMENTS

The ECOA and FHA were passed in response to troublesome lending and housing practices in the early 20th century.1 For example, prior to the ECOA, it was acceptable for lenders to deny loans to women and instead ask them to have their husbands apply.

And prior to the FHA, lenders could explicitly consider race, religion and national origin when making decisions in the underwriting of home loans.

The ECOA and FHA made it illegal to discriminate in lending on a “prohibited basis.”

Importantly, though, these laws did not bar lenders from denying loans based on credit risk or capacity to repay.

A NEW TOOL

To aid in the implementation of the ECOA and FHA and to promote public transparency, Congress passed the Home Mortgage Disclosure Act (HMDA) in 1975. The HMDA and its subsequent amendments detail public reporting requirements for most mortgage lenders. Loans covered include home purchase loans, home improvement loans and mortgage refinancings.

HMDA reports contain information about the location and demographics of applicants, as well as some terms of the loans.2 HMDA data are used by examiners, community groups and consumer

advocates to identify potential fair lending risks. Sometimes, HMDA data are cited in the press as evidence of discrimination when, for example, very high interest rates are more common on mortgages to persons of color than those on mortgages to others.

HMDA DATA JUST A STARTING POINT

While HMDA data provide a useful start in assessing lending practices, the data alone do not prove discrimination.

If HMDA data trigger concern, bank examiners conduct a comprehensive review, including an in-depth statistical analysis. The statistical analysis looks for legitimate credit underwriting factors, such as minimum credit scores and maximum debt-to-income ratios.

If statistically meaningful disparities exist after these data are considered, the examiner will then complete a detailed and exhaustive investigation. The investigation includes lender interviews, physical loan file reviews and data verification and validation.

strengthen its policies and procedures, risk monitoring, training or internal controls to ensure that discrimination does not occur.

After all, the goal of fair lending supervision should be to prevent discrimination before it happens.

NOTES AND REFERENCES

For additional information, see U.S. Department of Justice, Equal Credit Opportunity Act; U.S. Department of Justice, Fair Housing Act; and Federal Financial Institutions Examination Council, Interagency Fair Lending Examination Procedures (PDF).

1

Beginning in 2018, lenders are required to provide much more detailed data about loan applicants and loan terms.

For an overview of the HMDA and these new requirements, see the Sept. 25, 2017, Lexology article, “Major Changes Looming for HMDA Reporting.”

2

Julie Stackhouse is Senior Vice President and Managing Officer of Banking Supervision, Credit, Community Development and Learning Innovation for the Federal Reserve Bank of St. Louis.

It is rare for examiners to find discrimination after this exhaustive analysis. More typically, examiners identify opportunities for the bank to

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Millennials Lead All

Homebuyers Even as Some Can’t Escape Their Parents Courtesy of the National Association of Realtors

Home purchases by Millennials ticked up over the past year, but inventory constraints and higher housing costs kept their overall activity subdued and prevented some from leaving the more affordable confines of their Gen X and baby boomer parents’ homes.

This is according to the National Association of Realtors 2018 Home Buyer and Seller Generational Trends study, which evaluates the generational differences of recent home buyers and sellers. The survey additionally found

that Millennial buyers prioritize living close to friends and family over a home’s location and proximity to schools, and an overwhelming majority used a real estate agent to buy or sell a home.

Slightly more than a third of all home purchases were made by Millennials over the past year (36 percent; 34 percent in 2017), which kept them as the most active generation of buyers for the fifth consecutive year. Gen X buyers ranked second (26 percent; 28 percent in 2017), followed by younger (18 percent) and older baby boomers (14 percent) and the Silent Generation, those born

between 1925 and 1945 (6 percent; 8 percent in 2017).

According to Lawrence Yun, NAR chief economist, this year’s survey findings reveal both what it takes to be a successful Millennial buyer in today’s housing market, as well as why, even though sales to Millennials reached an all-time survey high, stubbornly low inventory conditions pushed home prices out of reach for many. As a result, the overall share of Millennial buyers remains at an underperforming level.

Revealing the greater purchasing power needed over the past year, the typical Millennial buyer in the survey had a higher household income ($88,200) than a year ago ($82,000) and purchased the same-sized home (1,800-square-feet) at a more expensive price ($220,000; $205,000 in 2017). Millennials also had higher student debt balances than in last year’s survey, and slightly more of them said saving for a down payment was the most difficult task in buying a home.

“Realtors throughout the country have noticed both the notable upturn in buyer interest from young adults over the past year, as well as mounting frustration once they begin actively searching for a home to buy,” said Yun. “Prices keep rising for the limited number of listings on the market they

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can afford, which is creating stark competition, speedy price growth and the need to save more in order to buy.”

Added Yun, “These challenging market conditions have caused – and will continue to cause – many aspiring Millennial buyers to continue renting unless more Gen Xers decide to sell, and entry-level home construction picks up significantly.”

Other key findings and notable generational trends of buyers and sellers in this year’s 144-page survey include:

YOUNGER BOOMERS AND GEN X BUYERS INCREASINGLY HAVE CHILDREN AND PARENTS LIVING AT HOME

Similar to previous years, younger boomers were the most likely to purchase a multi-generational home (20 percent), with a noteworthy rise in those indicating the top reason they did was for their adult children (above 18 years old) to live at home (39 percent; 30 percent in 2017), as well as their parents (22 percent; 18 percent in 2017).

The survey also found a growing a share of Gen X buyers buying for multigenerational purposes (15 percent; 12 percent in 2017), with a big jump in the top reason being for their adult children (35 percent; 26 percent in 2017) and parents living with them (30 percent; 19 percent in 2017).

“Costly rents and growing student debt balances appear to make living at home more appealing, affordable and increasingly more common among young adults just entering the workforce,” said Yun. “Even in situations where three generations are all cramped under the same roof, it can significantly help some Millennials eventually transition straight to homeownership.

Eighteen percent of Millennial buyers in the survey said their family home was their previous living arrangement.”

FRIENDS AND FAMILY MATTER FOR BUYERS BOTH YOUNG AND OLD

When deciding where to buy a home, quality of the neighborhood is the factor most influencing buyers of all ages, followed closely by convenience to a job for those up to working age (Millennials to younger boomers). Interestingly, even

more than the location and quality of a school, recent Millennial buyers were just as likely as older boomers and the Silent Generation (at 43 percent) to consider proximity to friends and family.

“The sense of community and wanting friends and family nearby is a major factor for many homebuyers of all ages,” said Yun. “Similar to Gen X buyers who have their parents living at home, Millennial buyers with kids may seek the convenience of having family nearby to help raise their family.”

MILLENNIALS BUYING CONDOS IN THE CITY AT A VERY LOW RATE

The share of Millennial buyers with at least one child continues to grow, at 52 percent in this year’s survey and up from 49 percent a year ago and 43 percent in 2015. With the need for a larger house at an affordable price, over half of Millennials bought in a suburban location (52 percent), while also being more likely than Gen Xers and younger boomers to choose a home in a small town. After climbing as high as 21 percent in 2015, only 15 percent of recent Millennial buyers purchased a home in an urban area.

Overall, at least 84 percent in every other generation worked with an agent to close the deal.

On the seller side, Gen X and older boomers were the most likely to use an agent (91 percent), followed closely by Millennials (90 percent) and younger boomers (88 percent). The near universal use of an agent to sell a home helped keep for-sale-by-owner transactions at their lowest share ever for the third straight year (8 percent).

“Especially in today’s fast-moving housing market, consumers of all ages want a Realtor® to guide them through the exhilarating, yet nerve-wracking experience of buying or selling a home,” said NAR President Elizabeth Mendenhall, a sixth-generation Realtor from Columbia, Missouri.

NAR mailed a 131-question survey in July 2017 using a random sample weighted to be representative of sales on a geographic basis to 145,800 recent home buyers. The recent home buyers had to have purchased a home between July 2016 and June 2017. All information is characteristic of the 12-month period ending in June 2017 with the exception of income data, which are for 2016.

Led by Gen X (86 percent) and Millennial buyers (85 percent), a detached singlefamily home continues to be the primary type of property purchased, and older and younger boomers were the most likely to buy a multi-family home.

Only 2 percent of Millennial buyers over the past year bought a condo.

“While there is an overall trend among households young and old to migrate towards urban areas, the very low production of new condos means there are few affordable options for buyers – especially Millennials,” said Yun.

REGARDLESS OF AGE, MOST BUYERS AND SELLERS WORK WITH A REAL ESTATE AGENT

Buyers and sellers across all age groups continue to seek the assistance of a real estate agent when buying and selling a home. At 90 percent, Millennials were the most likely to purchase a home through a real estate agent, and help understanding the buying process was cited as the top benefit Millennials said their agent provided (75 percent).

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TRID and “Gifts of Equity” Still No Answers

by James Maguire Compliance Alliance

In August of 2017, the Consumer Financial Protection Bureau (CFPB) finalized their changes to the TILA/ RESPA Integrated Disclosures Rule (TRID). After what many called a disaster of an initial launch, these changes finally addressed lingering questions about the rule, especially in the areas of construction lending and simultaneous second lien purchase loans. Unfortunately, the changes still failed to address other continuing concerns, among them how to disclose “gifts of equity” on the Loan Estimate and Closing Disclosure.

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“Gifts of equity” are essentially a discount on the sale price of the property below market value. The seller agrees to sell the property to the buyer for X number of dollars below what the property would go for on the open market; the X dollar figure is then considered a “gift of equity.” These “gifts” aren’t an issue with portfolio loans with a loan-to-value ratio (LTV) on the property below 80 percent—using the actual lower sales price as the value. The issues appear when the loan amount exceeds 80 percent of the actual sales price or in the case of investment loans— the issue being documentation as investors tend to require gifts of

equity to be clearly disclosed on closing documents, or how a “gift of equity” must be factored into the actual sales price of the property for LTV purposes.

So if you’re required to disclose a “gift of equity” somehow on the TRID forms, what to do? There are a few different schools of thought on this, and while there are slight variations for each, three basic approaches have been suggested.

For the first approach (Approach #1), some believe this amount should be disclosed as “Downpayment/Funds from Borrower” and then offset with a negative amount in “Adjustments and Other Credits” in the Calculating Cash to Close table. (In Section L of the Closing

the property actually is selling for (market price minus the “gift of equity”), and then mention the “gift of equity” amount in an addendum to the Closing Disclosure (leaving it off the Loan Estimate entirely).

Each of these three approaches carries certain negatives. The first approach, for instance, seems somewhat to mimic the process for disclosing gifts from family members prior to closing. But as the commentary to the regulation states, “Amounts expected to be paid at closing by third parties not otherwise associated with the transaction, such as gifts from family members . . . are included in the amount disclosed under [Adjustments and Other Credits].” It is clear that this approach is intended only for gifts from third parties, and not from parties involved in the transaction itself, which the seller would be. Secondly, this approach appears intended more for funds delivered at the closing table, as opposed to any gift delivered prior to or after closing as is arguably the case with a “gift of equity.” While the math may add up with this approach, it requires a stretch beyond the black-and-white regulatory language, and doesn’t quite seem to sync up with what the CFPB had in mind when disclosing ‘gifts’ on the Closing Disclosure.

Disclosure, the gift could appear in Other Credits, with a note that the fee is “P.O.C.” and paid by the Seller).

For the second approach (Approach #2), others feel you should put the amount in Seller Credits, offsetting that with a positive number in Adjustments and Other Credits and a figure in Section K under “Adjustments.” For both Approach #1 and Approach #2, the “gift of equity” would be disclosed in Section N, too, effectively reducing the amount of money remitted to the seller at closing.

Finally, for the third approach (Approach #3), still others feel like the best thing to do is simply to reduce the overall “Sales Price of Property” down to what

Regarding the second approach, while more straightforward than Approach #1, it too requires a bit of fiction, as a “gift of equity” from the seller is not really applicable toward closing costs, and also requires a bizarre and unexplained positive offset in Adjustments and Other Credits just to make the Calculating Cash to Close table to balance out correctly.

To make matters more troublesome, investors often limit any seller credit to a hard cap (such as 6 percent of the sales price), which could prove difficult for a large “gift of equity” being disclosed as a Seller Credit.

themselves to overlook the fact that a gift of equity was even present in the transaction. It also may create a discrepancy between the disclosed “Sales Price” on the Closing Disclosure and the “Sales Price” used to calculate LTV, which could give rise to questions of whether or not the disclosure is being presented in good faith.

All the pros and cons being weighted, we feel like right now, the best approach to “a gift of equity” is in fact Approach #3: to disclose the lower sales price for the Loan Estimate and Closing Disclosure, and then mention the “gift of equity” in an addendum to the Closing Disclosure. First of all, this is supported by the regulation. Secondly, while this may at first glance appear to cause issues with LTV, note that federal real estate lending standards and the Sale Price figure do not directly pertain to one another—all the lending standards say is, “For loans to purchase an existing property, the term “value” means the lesser of the actual acquisition cost or the estimate of value.” They do not contain any cross-reference to the TRID rules. Disclosing a lower sales price on the TRID forms and then mentioning the “gift of equity” in an addendum, both satisfies any investor requirements and also makes the math more simple for a borrower to understand; both of which are essential underpinnings of TRID. We feel that these benefits outweigh any generalized concerns about “good faith” regarding the disclosed sales price.

As with many things TRID, we continue to await guidance from the CFPB and other regulatory agencies on what the appropriate action for disclosing “gifts of equity” on Closing Disclosures will be going forward. In the meantime, please be sure to stick with Compliance Alliance for updates, and let us know if you have any questions regarding this perplexing topic!

The third approach appears to meet the investor requirement that the “gift of equity” be contained within the closing documentation; however, that gift of equity doesn’t mathematically factor into any of the calculations on Page 3, which may lead auditors, examiners, investors or even the borrower

James McGuire has worked as an attorney and legal researcher in the financial industry since 2010. He has extensive first-hand experience with open records, mortgage servicing, consumer law and securities regulation.

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Newly Signed Law Eases

Dodd-Frank Mortgage Restrictions on Community Banks

by Nick Arnold & Stuart Hindmarsh Kutak Rock

consumers, homeowners, and students.

On May 24, 2018, the President signed the “Crapo Bill,” formally known as the Economic Growth, Regulatory Relief, and Consumer Protection Act. The Crapo Bill modifies certain requirements of 2010’s Dodd-Frank Act and other consumer-oriented statutes, such as the Truth In Lending Act. The Crapo Bill was designed to ease some of the burdens imposed by Dodd-Frank on community banks and improve consumers’ access to credit. Below is a brief summary of certain provisions of Title I of the Crapo Bill relating to mortgage loans.

Additional changes are set forth in Titles II through VI of the Crapo Bill but are not summarized in this article, including regulations regarding certain bank holding companies, encouragement of capital formation, and loans to veterans,

Section 101 of the Crapo Bill codifies the safe harbor from certain ability-to-pay requirements for “qualified mortgages” under CFPB residential mortgage rules and expands the safe harbor to banks with assets below $10 billion.

Specifically, a residential mortgage is a “qualified mortgage” and the ability-topay requirements are presumed to have been complied with if the mortgage (a) is retained by the originating institution; (b) complies with limits regarding prepayment penalties, points, and fees; (c) does not have negative amortization or interest-only features; and (d) is made following proper consideration and verification of the debt, income, and financial resources of the consumer.

The Crapo Bill also provides for certain circumstances where the ability to pay requirements are waived when a loan is transferred by reason of a bankruptcy

or failure of the originating institution, merger, or transfer to a similar institution or wholly owned subsidiary.

Section 103 of the Crapo Bill creates an exemption from the requirement that there be an appraisal of real estate collateral prior to the extension of a mortgage loan in rural areas defined by certain federal regulations. This exemption applies to loans secured by rural real estate with a balance less than $400,000 when the lender has contacted at least three licensed and approved appraisers and has documented that no state licensed appraiser is available within certain timeframes and other standards in accordance with regulations regarding appraisal assignments.

Section 104 of the Crapo Bill exempts banks from certain Home Mortgage Disclosure Act reporting requirements.

The exemption would relieve banks from certain record-keeping requirements regarding closed-end (term loan) transactions and/or open end (line of credit) transactions if during each of the past two years the bank extended less than 500 transactions for each type of loan, and the bank has sufficient Community Reinvestment Act compliance ratings.

Section 106 of the Crapo Bill creates a grace period for mortgage loan

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period to temporarily work while either waiting for licensing approval or completing the necessary licensing.

Section 108 of the Crapo Bill creates an exemption from escrow requirements on loans secured by a first lien mortgage of a consumer’s primary residence if the bank: (a) has less than $10 billion in assets; (b) originated fewer than 1,000 mortgage loans in the preceding year; and (c) meets certain other specified requirements.

consumer mortgage regulations. While President Trump, CFPB head Mick Mulvaney, and some in Congress have indicated a desire for further rollbacks of Dodd-Frank, many professionals in the banking industry doubt there will be substantial movement in the near future, given the current partisan atmosphere in Washington and the upcoming mid-term elections.

Nick Arnold is a partner in the Rogers office of Kutak Rock LLP. He conducts a practice primarily focused on banking and commercial lending, real estate acquisition and conveyance, contracts and commercial transactions.

Section 109 of the Crapo Bill eliminates the three day required mortgage disclosure waiting period under the so-called “TRID Rule” pertaining to subsequent offers of credit if the second offer received by the consumer has a lower APR than the first offer.

originators who are transferring: (a) from a bank lender to a nonbank lender institution; or (b) from a nonbank lender in one state to a nonbank lender in another state. This allows mortgage loan originators changing jobs a grace

Stuart Hindmarsh is a partner in the Fayetteville office of Kutak Rock LLP. His practice involves real estate and banking, including assisting financial institutions with loans, workouts, deeds-inlieu, treasury management services, customer service agreements, vendor management, and compliance.

The above discussion is a summary of only some of the provisions of Title I of the Crapo Bill. As noted, there are other provisions of the Crapo bill that, along with Title I, will hopefully provide relief to Arkansas community banks from some of the more onerous aspects of Dodd-Frank and related

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PROFESSIONAL DEVELOPMENT

10 Complete ABA Trust School in May Ten bankers, representing seven financial institutions from across the state, came together to strengthen their bank’s trust departments during the ABA Trust School held in May.

The four-day event was led by instructors Dee Davenport, Simmons Bank; Coleman Westbrook, Friday Eldredge & Clark; Kristi Barger, Relyance Bank; Patrice Konarik, Sunwest Training; and Rex Kyle, First Security Bank. Curriculum gave bankers a strong foundation in Trust and IRAs, drilling down on unique assets, estate planning, and marketing.

Here’s what students were saying about the 2018 Trust School:

Trust School graduates were, in back: Lance Black, Arkansas State Bank Department, Little Rock; Christian Harrod, Centennial Bank, Jonesboro; Tammy Simpson, Simmons Wealth Management, “Great experience...

Pine Bluff; Clayton Carr, First National Bank of North Arkansas, Berryville; Scott Nelson, Iberia Mrs. Konarik did a great Bank, Little Rock; Chris Thyer, Centennial Bank, Jonesboro; and instructor Rex Kyle, First Security job covering IRA’s. Her Bank, Little Rock. In front: Kristin Beasley, First Arkansas Bank & Trust, Jacksonville; Leslie Brewer, explanations for differences Farmers & Merchants Bank, Stuttgart; Bethany Noto, Centennial Bank, Jonesboro; Hilary Trickey, Centennial Bank, Jonesboro. between rollovers and

transfers was extremely useful and easy to follow.”

-Lance Black, Arkansas State Bank Department

“The written materials are the best resource from the class so that I can refer back to them whenever needed.”

- Bethany Noto, Centennial Bank

Branch Management Series to Premiere in July On-going education, training, and networking are essential in developing successful branch management in today’s ever-changing environment. With that in mind, the ABA is introducing a two-day Branch Management Seminar series focused on developing the leadership skills needed to motivate and engage the team, increase loyal customer relationships, mitigate risks through compliance and regulatory adherence, and accomplish retail banking goals. Participants will engage in discussions, small group activities, and skills practices. The seminar will be held July 16-17 at the ABA office in Little Rock.

For more information, or to register call Kami at 501.978.3614 or log on to www.arkbankers.org.

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MEMBER NEWS Simmons Gifts $2.5 Million to Fund Athletics Upgrades A $2.5 million Simmons Bank gift for upgrades to football and baseball athletics facilities was announced on May 22 at the University of Arkansas at Pine Bluff (UAPB). The gift is the largest in UAPB history and will fund a new football stadium scoreboard and turf, along with completion of the baseball pavilion at the Torii Hunter Baseball and Softball Complex. UAPB Chancellor Laurence B. Alexander unveiled renderings for each design, which are available for public view at uapblionsroar.com. The gift is pending UA Systems Board of Trustees approval at its May 23-24 meeting.

“On behalf of UAPB faculty, staff, students and alumni, I’d like to express our appreciation to Simmons Bank for its generous gift,” said Alexander.

“This donation will directly benefit our student-athletes by assisting them in reaching and exceeding their athletic and academic performance goals.”

“Simmons is honored to partner with UAPB to help students excel right here in our hometown of Pine Bluff,” said George A. Makris, Jr., chairman and CEO

of Simmons First National Corp. “There is nothing more rewarding for our bank than the opportunity to invest in our communities, especially in our young people.”

UAPB Interim Director of Athletics Alyse Wells-Kilbert added, “We are grateful to Simmons Bank for its long-standing partnership with UAPB, and more specifically, this major gift that will allow us to complete much needed upgrades.

These improvements will benefit our student-athletes and create a better fan experience during football and baseball games.”

The event was followed by a tailgatestyle reception.

Farmers Bank & Trust to Give Company Wide Bonus The Farmers Bank & Trust Board of Directors and Management Team announced that following the enactment of the new federal tax reform legislation, it will distribute special cash bonuses to its more than 275 employees in South Arkansas and Northeast Texas. All employees will receive $500 to $1,000 in May 2018, based on their current years of service with the Bank.

Farmers Bank & Trust President and CEO Chris Gosnell said, “Our employees are the heart of our success and strive to play an active role in the communities we serve. We are excited for the opportunity to reward our hard-working employees with

this special bonus as a token of our appreciation for all they do for our customers, businesses, and communities.”

In addition to this one-time payout, Farmers is committed to the long-term success of its employees. Last year, the bank’s Stakeholder Incentive Plan paid almost $2 million to all the bank’s employees. While the bank is hoping for a strong payout in 2018, net income after taxes is not specifically rewarded by the plan. Because Farmers Bank & Trust benefited from the federal tax reform legislation, some of the benefit was shared with employees.

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BANKER NEWS & MOVES Citizens Bank Elevates Harris to Lead Retail Operations at Main Branch

as a Teller and Customer Service Representative at the branch in Pleasant Plains. She transferred as Assistant Manager at the Eagle Mountain location, and was named its Retail Branch Manager in 2015.

Citizens Bank has promoted Katherine Harris to Assistant Vice President and Retail Branch Manager at its current financial services headquarters in Batesville.

Harris had previously managed the bank’s Eagle Mountain Branch.

She earned a Bachelor of Business Administration Degree with an emphasis in Business Management from the University of Central Arkansas.

Harris and her husband, Derek, have two children, Owen, 2, and Eden, 3 months.

They are members of Saint James Catholic Church in Searcy. n

“Katherine has consistently demonstrated outstanding abilities as she has eagerly assumed increasing responsibilities during her service with Citizens Bank,” said Phil Baldwin, Chief Executive Officer. “Citizens Bank customers will be well served by her leadership.”

Simmons Bank Expands Correspondent Banking Services, Promotes Heady

“Katherine Harris excels at all of the attributes we seek in team members who are committed to excellence in banking and customer service,” said Adam Mitchell, bank President. “She distinguished herself in Citizens Bank’s EDGE program, which is a unique internal curriculum that identifies, engages, prepares and develops a new generation of banking leadership.”

After managing the retail operations of the current headquarters location, Harris will assume the same responsibilities at the new Citizens Bank headquarters building on St. Louis Street in Batesville upon its completion later this year.

Correspondent

Banking. Heady will lead the expanded department, delivering services including credit and treasury management, to financial institutions throughout its seven-state footprint.

“We are now in a position where we can partner with community banks to better serve their needs in this changing environment,” said Matt Reddin, Simmons Bank President of Banking Enterprise.

Heady has worked for Simmons Bank since March 2017, as senior vice president of commercial banking. Prior to joining Simmons, Heady served

Harris began her career with Citizens Bank six years ago

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Simmons Bank has named Scott Heady of Kansas City, Missouri Director of

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as senior vice president in the commercial banking division of UMB Bank, also in Kansas City, for nine years.

Heady has more than 30 years of corporate middle market banking experience, including correspondent banking during the financial crisis. In his new role, Heady will relocate to Little Rock, Arkansas, where he will mobilize a team to partner with community banks across Simmons’ footprint.

“We could not be more pleased to have Scott assume this position,” Reddin said. “Scott’s outstanding track record of managing a significant and complex loan portfolio combined with his ability to develop consultative relationships make him an incredible asset to Simmons.”

Heady’s work extends to charitable causes in the Kansas City area. He currently chairs the finance committee for Villa St. Francis, a nursing and memory support community. Heady is past chairman of both the board and finance committees for Santa Marta, a continuing care retirement community sponsored by the Archdiocese of Kansas City in Kansas. n

Anstaff Bank Adds Adams as AVP/Commercial Lender Anstaff Bank has announced the addition of Spencer Adams as Assistant Vice President, Commercial Lender, according to Brad King, President.

“We are very excited to have Spencer join Anstaff Bank in Mountain Home,” said King. “Commercial Lending is a very important segment of Anstaff and Spencer’s knowledge and experience has made our team stronger.”

Adams brings 12 years of banking experience to Anstaff. Since graduating from the University of Arkansas with a Bachelor of Science in Business Administration, Spencer has served as treasurer for both The Ozark Mountain Region, Inc. board and the Mountain Home Youth Baseball Board.

He is also a board member of the Baxter County Razorback Club.

Spencer enjoys spending time with this wife, Robin, and children, Cooper and Baylee. His hobbies include coaching youth basketball and baseball, golfing and fishing. n

Grand Savings Bank Promotes Chastity Cochran Grand Savings Bank is pleased to announce the promotion of Chastity Cochran to Consumer Loan Officer.

Cochran works in the Gravette location and has been with Grand Savings Bank for 13 years serving as a Loan Assistant. She is a graduate of Jay, OK high school.

“Chastity is amazing and an important member of our team. She’s very deserving of this promotion,” said Carla Martinez, Market President, Western Benton County. n

Anstaff Bank Adds Bailey Bodenhamer as AVP/Loan Officer Anstaff Bank has announced the addition of Bailey Bodenhamer as Assistant Vice President, Loan Officer, according to Brad King, President.

“Bailey is a valuable addition to the Anstaff family,” said King. “Bailey will assist us in meeting the growing lending needs in Baxter and Marion counties.”

Bodenhamer brings 6 years of banking experience to Anstaff. Bailey is on the board of the Twin Lakes Future Fund, Advisory Board for Peitz Cancer Support House and the Reppell Diabetes Learning Center. He is a graduate from the University of Arkansas with a Bachelor’s of Science in Agricultural, Food and Life Sciences.

Bailey lives in Mountain Home and enjoys spending time at his family farm, playing golf, and watching his nieces and nephews play softball and baseball. n

Trammell Promoted to Loan Officer at Eagle Bank Jeff Lynch, President and CEO of Eagle Bank and Trust, has announced that Dustin Trammell has been

promoted from a Credit Analyst to Loan Officer.

Dustin will be responsible for all lending activities at the Quitman and Rose Bud branches of the bank. He began his career with Eagle Bank in 2013 as a Part-Time Teller while attending college, he then accepted a position as a Full-Time Teller upon completion of his studies.

Dustin earned his Associates of Science in Business from ASU-Heber Springs, then continued his education at the University of Central Arkansas in Conway, studying Finance and earning his BSBA in the spring of 2016. A native of Quitman, he is a very active member of the Howard General Baptist Church.

Among his community activities, Trammell serves as Chairman of the Cleburne County Relay for Life. n

Broyles Retires from Centennial Bank Longtime employee Brenda Broyles retired from Centennial Bank in Mountain View on May 18, 2018.

The bank held a community reception in her honor on May 10.

Broyles began her career at the Bank of Mountain View on October 1, 1973. n

Arkansas Bank Department

Applications & Approvals Branch Bank Application An application filed by Arvest Bank, Fayetteville, Washington County, Arkansas, to establish a branch banking facility at the corner of East 106th Street North and N 138th E. Avenue, Owasso, Tulsa County, Oklahoma, has been approved. May 16, 2018.

Patel Promoted at State Bank Department The Arkansas State Bank Department promoted Dharmin H. Patel to Certified Examination Manager effective May 20, 2018. Patel will manage a team of eight Little Rock based examiners who conduct safety and soundness examinations.

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Arkansas Bankers Association

Annual Washington Visit October 2-4, 2018

Join your fellow #ARHometownBankers this fall for the ABA’s Annual Washington Visit.

Take advantage of this opportunity to share concerns on pending legislation, regulations, and policies face-to-face with the people responsible for writing them.

For more details or to register, please contact VP/Director of Government Relations Ava F. Roberts at ava.roberts@arkbankers.org.

www.arkbankers.org