The Arkansas Banker Fall 2020

Fall 2020 • Volume CVI, No. 11

2020 BKD MILESTONES IN BANKING AWARDS HONORS BANKERS

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COLUMNS

Fall 2020 • Volume CVI, No. 11

President’s Message . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 Lorrie Trogden

Chairman’s Column. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Jon Harrell

Washington Update . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 Rob Nichols

DEPARTMENTS AmBA Training, Live Events & Webinars . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Emerging Leaders Update. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 Member News. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 Banker News & Moves . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47

ARTICLES Diversity, Equity, & Inclusion: Working Groups. . . . . . . . . . . . . . . . . . . . . . 10 Updates from the Courts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 Small Steps to a Greener Bank. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 Force Majeure in Arkansas. . . . . . . . . . . . . . . . . . . . . . . . . . . 30 2020 BKD Milestones in Banking Awards. . . . . . . . . . . . . 38 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 quarterly 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.

Arkansas Bankers Association Staff Lorrie Trogden, President/CEO • Carla Brinkley, VP/Controller • Kami T. Coleman, VP/Professional Development • Jessica Sahene, Technology & Marketing Director • Michael Spigner, Communications Director • Anna Squire, Business Development Director

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President’s Message ABA OFFICERS Jon Harrell, Chairman

Lorrie Trogden | President & CEO Arkansas Bankers Association

Generations Bank, Rogers

Jim Cargill, Chairman-Elect Arvest Bank, Little Rock

Randy Scott, Vice Chairman Farmers Bank & Trust, Blytheville

Tom Grumbles, Treasurer First Service Bank, Greenbrier

Rob Robinson, IV, Past Chairman Simmons Bank, El Dorado

Lorrie Trogden, President & CEO

Arkansas Bankers Association, Little Rock

BOARD OF DIRECTORS Craig Attwood, Pine Bluff Nathan Gairhan, Springdale Robert Husong, Rogers Gary Kleck, Springdale Cody Knight, Piggott Lance Lanier, Van Buren Barry Ledbetter, Little Rock Wilson Moore, Little Rock Evelyn Morris, El Dorado Marnie Oldner, Little Rock Mark Roberts, Malvern Todd Smith, Magnolia Jamie Waller, Magnolia Lynn Wright, Little Rock

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It is often said, “We are defined by our actions, not our words.”

Our industry has faced tremendous challenges in recent months, and you rose to meet those challenges with extraordinary effort and innovative solutions.

Our members did what you do best, take care of your customers and community. The ABA is incredibly proud to have worked alongside our members to provide valuable resources. We like to think that is what the ABA does best.

I would like to take a moment to review some of the ways in which the ABA assisted Arkansas banks during the last quarter. Daily conference calls and recap emails covering the countless number of alerts, notifications, rule modifications, and changes put out by regulatory agencies. Ever changing SBA/Treasury FAQs and IFRs. Federal legislation, state, and city executive orders.

In addition, we had many guest speakers on those calls giving you the opportunity to ask questions and influence policy decisions. Some of those included: Governor Asa Hutchinson, Senator Tom Cotton, Senator John Boozman, Congressman French Hill, Congressman Rick Crawford, Congressman Bruce Westerman, Congressman Steve Womack, the FDIC, the Federal Reserve, FinCEN, the OCC, the state director for the Arkansas SBA office, Bank Commissioner Candace Franks, Secretary of Commerce Mike Preston, and state epidemiologist Dr. Dillaha. During the early months we were averaging over a hundred bankers on those calls.

Bankers worked around the clock during both phases of the funding to get applications through the system, and ABA worked nights and weekends to provide constant access and advocacy for our members in order to get the most up-to-date information out, relaying information about SBA issues, and working with our delegation to trouble shoot specific instances as quickly as possible.

critical during this election cycle by making sure we are supporting candidates who understand bankers’ concerns. This is our opportunity to ensure that business-friendly, free market candidates are elected to the highest federal and state offices.

Your contributions to ABA BankPAC ensure policymakers that understand banking will have a seat at the table when critical decisions are made.

We also advocated at the state and city level to ensure banks were declared essential, the proper reopening and mask guidelines were approved and posted by the Department of Health, and to get COVID liability immunity in place.

With that in mind, we are kicking off our official ABA BankPAC campaign that will run through the month of September with a goal of $75,000 in contributions for both federal and state races. We are adding a new initiative this year, the 13th Board Meeting. I’ll be mailing you specific information about program logistics. Speaking to banks and bank boards of directors is another of my top priorities right now, so I will do all I can to come to one of your board meetings. Chairman of the Board Jon Harrell has also volunteered to come when called. A 13th board meeting is a specially called meeting held immediately before or after a regularly scheduled board meeting for the specific purpose of discussing ABA advocacy efforts. Board members are paid a customary fee for their participation in the extra meeting and are invited to make a financial contribution to ABA BankPAC. This is permissible and can make a big difference in our fundraising for ABA BankPAC. This is the first of many communications you will receive from me this year about ABA BankPAC – it’s that important. Please call me with any questions or to schedule myself or Jon for an upcoming board meeting.

Communicating with the media about how banks were essential to the economic recovery process and the difference you were making in your customers’ lives and businesses was pertinent. We pushed out PPP success stories, and other pieces of vital information to the media with press releases and tv news and print publication interviews. We took every opportunity to get the message out to the public and help them better understand the important roles banks play in our economy and society.

We are always fighting for you, but more importantly, we are fighting alongside you for the banking industry. I cannot thank you enough for being there to serve your customers and communities, and rest assured the ABA will always be here doing everything we can to help your bank succeed.

The action only continues to grow hotter as we get closer and closer to election day. We have the full attention of our state and federal elected officials and they’re looking to the banking industry for our support. Your ABA BankPAC continues to be

In closing, we hope you, your families, customers, employees, and communities are safe and well, and we look forward to the better times that await us all.

TO THANK YOU OUR ABA BANKPAC DONORS

Farmers Bank & Trust Co. 

Marnie Older 

Magnolia Banking Corp. 

Boris Dover

Horatio State Bank 

Cornerstone Bank

First Community Bank 

Eagle Bank & Trust Co. 

Works24 Corporation 

Lorrie Trogden 

MNB Bancshares, Inc. 

BKD, LLP 

Jon Harrell 

Petit Jean State Bank

$500 Club

Your Arkansas Bankers ABA BankPAC contribution is one of the most important investments you can make to protect the future of the banking industry.

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CHAIRMAN’S COLUMN Jon Harrell | Chairman

Arkansas Bankers Association

VIRTUALLY! I am proud and honored to be the first ever Virtual Chairman of the Arkansas Bankers Association. I don’t have to tell anyone that this year has been like none other. When I was first approached for this position by Bill Holmes in 2018, part of his sales pitch was the allure of several paid trips to pretty cool destinations. Destinations do not appear to be part of the picture for 2020-2021. There was an opportunity to go to Omaha in June – missed out on a good steak and the possibility of seeing the Razorbacks in the College World Series. Portland was on the schedule in July and I can’t say I am disappointed that one was derailed, even though I am sure I could have gotten a federal escort! Boston doesn’t look good in October and I was really looking forward to going there and sitting in Norm’s chair at Cheers. Maybe Arizona in February, holding out hope on that one. My virtual induction as Chairman in May was memorable and I didn’t have to take up any time working on a lengthy speech.

The association postponed the Annual Convention scheduled in April until September. In late July, it was apparent that we needed to start planning a virtual Annual Convention on the September dates. Several of the association’s staff had been attending other state’s virtual conventions to observe the look and feel as to how it would work. So we will work with an outside consultant company to make sure we pull this off as fluidly as possible. We will still have our speakers as part of the Convention and have the Day with the Commissioner incorporated into our dates. Having the Convention virtually should allow for more of everyone’s staff to attend, especially the sessions that will directly apply to their specific job functions. We will be able to limit breaks and some of the pageantry which should allow us to condense the sessions so everyone can still make time for 18 holes of golf or a trip to the gym, whichever you prefer. Just make sure you get your preferred vendor to send you their credit card info so you can go to dinner on them after the first day.

By now, we have all attended several virtual meetings and some of us have even learned how to use the video link so that we can see each other. My bank board has been meeting virtually since March and it was recommended to me that we use Zoom or some other technology for video, but based on the average age of my board member, I think this would have been a futile endeavor. So, we make it work over the phone.

Most of the virtual meetings I have attended you get a mix of people using video and people on the phone being represented by a black box with their name at the bottom. Sometimes

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it’s nice to toggle back and forth maintaining video when you are paying attention and turning off the video when you are eating a sandwich or you step away for a bathroom break. Either way, the work always gets accomplished.

Since we are preparing for a virtual Arkansas Bankers Convention and Day with the Commissioner, I believe it is helpful to go over a few basic items regarding virtual meeting etiquette: 1. Please mute when you are not speaking so everyone does not hear ruffling papers and the sound of text notices; 2. If you are working from home, find a quiet spot so everyone doesn’t see members of your household going about their business behind you during the conference; 3. Make sure you test your camera angle prior to the meeting so everyone doesn’t have to see you reaching out and moving the camera eye staring at you and; 4. Try not to zone out during the virtual meeting because it can be distracting to everyone else as they try and figure just what the heck has got your attention, if anything.

I am really proud of the ABA staff and their willingness and dedication in taking on something that has never been done.

It is a good thing they are not a bunch of former bankers because they would lack the creativity and ingenuity to pull this off! Seriously, I would like to thank all of you for the support you show the association and I am looking forward to leading this virtual Convention.

Who knows, I might make it to Arizona in February in person.

If not, virtual it is. . .

ABA Launches Banker Hub: Peer Group Exchange

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o ensure the ABA continues to provide relevant and valuable resources, we are excited to share that the ABA has launched the Banker Hub: Peer Group Exchange community board. It provides a place for bankers to share ideas, tips, and resources with their peers across the state. The communities each offer their own discussion topics, document libraries, and personal blogs.

To kick off the discussion, visit www.arkbankers.org and login. Then, click on the Peer Exchange graphic on the right side of the page. Select a community and click the Follow button. You will start getting email notifications any time someone posts to the community board.

The community boards are open to member banks, endorsed vendors, and our associate gold vendors. If there is a topic that you would like to see added to the community list, email Jessica Sahene at Jessica.sahene@arkbankers.org.

You’re keeping your health in check, but when was the last time you checked your financial well-being?

Business Tax Deductions

Are you taking advantage of all the tax deductions available to your business? Arkansas employers receive a business tax deduction up to $500 per employee when you match employee contributions into an Arkansas 529 Education Savings Plan.

Retirement

Are you maximizing all of your retirement contributions? If your employer matches your contributions up to a certain percentage, take advantage of that and, when possible, put in the maximum amount you can.

Education Planning For Your Children

Need to know which schools offer the best scholarships? Or how much you should be saving now to afford college later? ARCollegeSaver.org makes it simple with dynamic college planning tools and calculators.

Life After Death

Do you have a will and an estate plan? Have you thought about how your assets will be distributed when you are gone? Prepare a plan that will save your loved ones the burden of making those difficult decisions.

Arkansas Treasurer of State

Dennis Milligan www.artreasury.gov 501.682.5888

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WASHINGTON UPDATE Rob Nichols | President & CEO American Bankers Association

Personal Finance for the Pandemic Era: Why Bankers Should Deliver Fin Ed Lessons Today The pandemic has forced many lessons on us, not the least of which is the importance of being prepared. I don’t mean being-well-stocked-on-toilet-paper prepared. I mean having the ability and resources to survive an uncertain and even perilous period. For businesses, that clearly requires having a well-crafted and tested business continuity plan. For households, the most important preparedness tool may be a well-funded savings account.

Those who may not have fully appreciated this before COVID-19 certainly understand it now. In fact, a Bank Rate survey this summer found that Americans’ top financial regret is not having enough emergency savings to withstand the crisis, followed closely by not having enough retirement savings.

This presents an important opportunity for banks, which can—and should—help support both established and fledgling savers as they pursue their savings goals. Nothing is more fundamental to financial wellness than savings.

Given the massive economic dislocation caused by the pandemic, this may seem an odd time to exhort others to save.

Many are suffering from loss of income and find it challenging to pay their expenses; how can they possibly set aside money for a rainy day when it’s already pouring? But there’s reason to view this as the ultimate teachable moment, and an ideal time to convert lessons into action.

In a July survey of hourly workers (by DailyPay and Funding Our Future), 51 percent said that coming out of the pandemic, they are more likely to save for the future, as opposed to 15 percent who said they were less likely to do so. Meanwhile, 65 percent said they don’t have any type of savings account, and 62 percent said they would be able to save more if there was an easier way to set aside a portion of their paycheck.

These data point to a clear demand for information and tools to facilitate savings, and banks are a reliable source for both.

To help banks meet that demand—and prevent financial regrets in the first place by teaching financial fundamentals to today’s youth and young adults—the American Bankers Association (AmBA) Foundation has adapted its financial capability programming for today’s virtual world. Teach Children to Save

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lessons went virtual in April, and Get Smart About Credit, our fall program, has also been adjusted to include new resources and notes for delivering effective virtual presentations, as well as new modules around saving for the unexpected.

We all know that strong personal finance skills are essential to success in life. In fact, a majority of respondents in the latest Charles Schwab Financial Literacy Survey said that money management was the most important skill for children to learn, outranking the dangers of drugs and alcohol, healthy eating and exercise habits and safe driving practices. And nine in ten agreed that a lack of financial education contributes to some of the biggest social issues our country faces, including poverty, unemployment and wealth inequity.

Which brings us to another lesson learned from the pandemic: Significant disparities in health, education and job opportunities persist. Those disparities have exposed some populations to greater risk—of catching COVID-19 or losing a job—and they’ve left some children more vulnerable than others to the negative effects of school closures.

Education, including financial education, can help reduce these disparities and give all Americans an equal opportunity to prosper. Few are more qualified to deliver lessons in personal finance than bankers, so I strongly encourage you to register as a volunteer for a financial education program today.

The AmBA Foundation makes it easy—and free. Visit aba.com/ FinEd to learn more and sign up. This is one of the most important ways bankers can make a long-term difference in the lives of others.

The more individuals we reach with this valuable information, the better off our communities will be. And there’s no doubt it is better to learn personal finance lessons in a class Zoom than in a crisis.

ABA PROFESSIONAL DEVELOPMENT

AmBA TRAINING American Bankers Association (AmBA) Training includes extensive learning opportunities suited to specific job roles, in both facilitated and self-paced online formats, as well as in person. Flexible and cost-effective, AmBA’s online training opportunities are continually updated to provide a superior learning experience that can be accessed from anywhere, at any time.

UPCOMING ONLINE COURSES Introduction to Agricultural Lending September 28, 2020

Marketing Management October 26, 2020

Consumer Lending November 2, 2020

Basic Administrative Duties of a Trustee September 28, 2020

Money and Banking November 2, 2020

General Accounting November 9, 2020

Managing Interest Rate Risk November 2, 2020

Analyzing Financial Statements December 7, 2020

Basic Lines of Business October 12, 2020

For more information about AmBA Training, log on to www.arkbankers.org or call 501.376.3741.

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

UPCOMING EVENTS

Providing you with educational topics to learn about from the comfort of your desk!

ABA Virtual Annual Convention September 15-16, 2020 Create Engaging Conversations in the Branch of the Future September 17, 2020 Commercial Lending School September 21-25, 2020 Secured Loan Documentation September 24, 2020 Real Estate Loan Documentation September 25, 2020 IRA School September 29, 2020 2020 Digital Banking School September 30, 2020

Being Strategic with Base Compensation for Non-Executives October 1, 2020 Small Business Lending October 1, 2020 Performing Your ACH Audit & Tips for Your ACD Assessment October 7, 2020 Top 25 Safe Deposit Compliance Issues October 8, 2020 Call Report Preparation October 15, 2020 Excel Explained: Filtering and Slicing Data October 15, 2020

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Diversity, Equity, & Inclusion: Working Groups

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By Naomi Mercer, SVP, Diversity, Equity, & Inclusion American Bankers Association n the past six months, the American Bankers Association (AmBA) has formed three groups around diversity, equity, and inclusion to foster bankers’ discussions and create opportunities for collaboration.

The first group, the AmBA Diversity, Equity, and Inclusion Advisory Group provides input to guide ABA staff on programming and advocacy efforts while serving as a major resource for bankers’ DEI needs. The group’s mission includes developing new DEI opportunities and expanding existing programs that highlight banking as a career of choice.

The Advisory Group helps create and execute initiatives that showcase the industry’s diverse and dynamic career opportunities and commitment to supporting equitable banking solutions. They advise AmBA on recruiting and retaining diverse talent and expanding succession planning resources. The advisory group also complements and reinforces the emerging leader/women’s leadership programming developed by AmBA and state banking associations.

This group is made up of seventeen bankers drawn from different asset-sized banks, a cross-section of geographic locations, and varying positions within their banks though all having a strong interest in and/or responsibilities for diversity, equity, and inclusion. The bankers in the Advisory Group represent a number of identity factors, including, but not limited to different races/ethnic groups and genders. They meet on a quarterly basis and members serve a two-year term. Naomi Mercer is the staff liaison for the Advisory Group.

At the most recent Advisory Group meeting, the members discussed AmBA’s response to the current civic activities around

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police brutality and racial inequalities more broadly as well as their own banks’ responses. Other topics included internal and external communications regarding current events, the pros and cons of in-house or outside consultants to lead facilitated “critical conversations,” ways to engage their communities, and the need for online assessment tools to pair with self-reflection exercises that foster individual development on DEI topics.

While forming the Advisory Group, AmBA staff realized that a two-pronged approach was indicated. AmBA had identified a dearth in policy input on DEI subjects from organizations with more robust DEI programs. The AmBA Diversity, Equity, and Inclusion Peer Working Group is a forum for chief diversity officers and other senior diversity practitioners at midsize and larger banks with established diversity and inclusion programs. The Peer Working Group provides a forum for bankers to discuss and share current trends, challenges, and leading practices. They also offer feedback on DEI policy and advocacy efforts and provide input on AmBA resources related to diversity and inclusion. Beginning in February of this year, the Peer Working Group meets on a near-monthly basis. The staff liaison is AmBA policy attorney, Diana Banks.

Recent Peer Working Group meetings have focused on pivoting focus from recruiting and workforce issues to social justice issues, particularly the banking industry’s response to the Black Lives Matter Movement and racial disparities in income equality. Other topics of discussion included policies requiring masks inside bank branches for health and safety issues and the potential racial profiling implications, community outreach and engagement, and the latest developments in legislation regarding DEI and banks.

After the Advisory Group and Peer Workings Groups were formed, AmBA received a plethora of inquiries from bankers requesting a venue for peer engagement on DEI topics. As a result, in late July, AmBA hosted the first DEI Open Forum for all bankers interested in DEI. The Open Forum is for bankers to discuss current DEI challenges and topics, exchange leading practices and ideas, and to learn more about implementing diversity, equity, and inclusion programs and initiatives at their banks. The Open Forum lets AmBA hear from members not involved in other DEI groups and helps AmBA determine the resources and tools members need that AmBA may be able to develop for them in the DEI space.

Topics of discussion for the inaugural meeting ranged from approaches to DEI responsibilities in the bank to board of director oversight of DEI programs, types of metrics to measure DEI progress, the OMWI self-assessment, and successful initiatives. Because of the amount of interest in and attendance at the inaugural meeting, the Open Forum is currently scheduled to meet once a month. Naomi Mercer is also the staff liaison for the Open Forum.

All of these groups provide valuable feedback to AmBA and provided the impetus for AmBA to develop several resources now available on the DEI page, aba.com/diversity. The latest member-requested resources include: a Leading DEI Practices repository; training for diversifying a bank’s board of directors; DEI key terms; dos and don’ts for critical conversations; tips

for retaining senior executives from underrepresented populations; and much more. Our member banks are leaning into diversity, equity, and inclusion and AmBA is here to support those efforts.

About the Author

Naomi Mercer is senior vice president for diversity, equity and inclusion at the American Bankers Association. She transitioned from a 25-year military career where she served as an assistant professor in the Department of English and Philosophy at the United States Military Academy and in the Pentagon running the Army’s gender integration and religious accommodation programs. Her educational background includes a doctorate in literary studies with a minor in gender and women’s studies from the University of Wisconsin-Madison and an executive certificate in strategic diversity and inclusion management from Georgetown University’s Institute for Transformational Leadership. She is the author of the academic monograph, Toward Utopia (2015).

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5

minutes with...

Robert Husong President First National Bank of NWA

Please tell us a little about yourself.

I grew up in Grove, Oklahoma which is near Bentonville, AR. Growing up in Grove I worked on a cattle ranch and worked with heavy equipment both businesses ran by my family. I attended the University of Arkansas and graduated with a degree in Marketing Management in 1996. Upon graduating, I got married and moved to central Oklahoma. My wife and I moved back two years later and have been in NWA since. I have four boys and we, including my wife Carrie, all like to run, hike, camp, fish, and anything outdoors related. I also enjoy hiking mountains (those over 14,000 feet known as "14ers") in Colorado when I am able to get away. To date I have hiked 18 of the 58 peaks.

How long have you been in the banking industry?

Upon graduating from the U of A in 1996, I became a loan officer in Oklahoma City. I spent two years getting a crash course on all things lending, sales, and collections. We then moved back to NWA in 1998 and I went to work for McElroy Bank & Trust in Fayetteville. I worked there through the “.com” bubble bust, Y2K, and 9/11 while also seeing the consolidation of charters to become Arvest Bank. I left Arvest in 2004 with a group of friends/co-workers to start a new bank in Fayetteville. I’ve always had an entrepreneurial nature, so being part of a de novo bank was very intriguing and exciting to me. We officially opened Signature Bank of Arkansas (SB of A) in May of 2005. The time between leaving Arvest and opening SB of A we actually worked on staff at Community First Bank (CFB) in Harrison, partnered in helping us start SB of A. It was during that time I learned how great a community Harrison is and how awesome the bankers were, namely King Gladden (who left us way too soon) and his “partners” at CFB. At SB of A, as with any startup, we all wore lots of hats and were pushed to learn new things. At one point, it was joked internally that I had five different concurrent titles, depending on what capacity I was being used for the day. I think I had moved through 17 different physical offices while there due to our fast growth. I was at SB of A when the housing bubble hit and with some tenacity, a lot of hard work, long days, great teammates, leadership, and customers, we made it through. I had the opportunity to learn a lot and meet a lot of great bankers from across the state before, during, and after that great recession while at SB of A. It seems like a distant memory now but I wouldn’t change that experience for the world. In 2013, my current employer, the First National Bank of Fort Smith, asked me to join them to take the helm of their NWA division which was formerly known as Bank of Rogers.

I was asked to rebrand, build a team, build a culture, and grow a bank while helping the NWA community by being a local bank that gives back. Since joining this team in 2013, we have rebranded to First National Bank of NWA, expanded into two NWA cities, helped redefine what a banking experience can be, and found numerous ways to give back to our community by creating opportunities for small businesses and non-profits to partner together to benefit them and the community.

What trait does the modern banker need to have to be successful?

Have passion. Have a passion to help your customer, help your town, help those that need help. Have passion to see your world change for the better even if it means taking some risk and doing something you’ve never done before. Have passion to see your own organization be more than it currently is, there is always room for one to be better. Take pride in who you are and who you work for and where you live. Have passion to do your job the best you can. This should drive us to learn, to listen, to be our best every day, and to be a bridge in the community for others ideas or dreams to become reality.

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To you, what is the most enjoyable aspect of being a banker?

There are definitely aspects to banking that are not enjoyable, so if you are going to survive and even thrive in banking, you have to have something that you find enjoyable and rewarding. For me, it’s a combination of things. I enjoy being a part of the community and seeing what I can do to make it better.

I love helping the startup business and seeing them succeed.

I love the relationships I’ve developed with customers, community members, and my team. I also love building/problem solving. Whether helping other people grow or building new processes, products, or even some cool branches (sorry, a little plug for FNBNWA) I like being creative. I think this fulfills my entrepreneurial side which is rewarding to me.

What is the most important lesson you’ve learned in career to date?

Never stop listening and learning. Especially in this drastically changing world, bankers need to be listening to their customers and their employees. If you don’t know what issues your customers are facing or how they view you or your organization then you are already headed in the wrong direction. The same goes for listening to your team. But you can’t just listen, you have to act as well. This means that you also have to be willing to learn new ideas and new technologies in order to sometimes act on the issues that were brought up. Our customers and teams need us to be the leaders in problem solving so we must be constantly learning if we are to stay relevant.

What do you perceive as the challenges facing your community today, and what is your bank’s role in contending with these challenges?

Well, at the moment it’s hard to think past COVID-19 but I think we are as a nation/state/community at a pivot point of how we interact and conduct business with each other, especially banks. Unfortunately it’s too soon to determine the full extent of permanent change but I know this is going to drive everyone to embrace more technology. It’s a concern as the community banks advantage is the connection with the local community and people. Community banks are also key supporting the community by helping organize local fundraisers, support of non-profit events, youth activities, etc. Our communities need our local banks to be involved to support community services.

Our small businesses need our local bankers to be available and accessible for their experience and advice. As community banks we will have to be creative on how we are able to meet these needs. Virtual galas, streaming youth sports, Zoom meetings with small business owners, whatever it may be – the need for community banks and bankers doesn’t go away but our interaction is changing and it’s up to us to be ready and prepared for how we interact with our communities going forward. I’d encourage bankers to not sit back and wait but be leaders of change in this area, your community needs you.

What’s your biggest guilty pleasure?

Mine are food related: Crispitos from the local gas station and I still eat a Twinkie once in a while.

MANAGE YOUR RISK. COU N T ON OU R AT TOR N E YS FOR BA NK RU P TC Y COU NSEL

• Bankruptcy

• Complex Workouts

• Business & Commercial Litigation

• Fraud Investigations & Reporting

• Commercial & • Landlord & Agricultural Foreclosures Tenant Issues

LITTLE ROCK

Chris McNulty

|

ROGERS

Lance Miller

|

JONESBORO

Stan Smith

|

AUSTIN

Allison Raley

425 W. Capitol Ave., Ste. 1800 | Little Rock, AR 72201 | (501) 688-8800

MitchellWilliamsLaw.com | Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C Jeffrey H. Thomas, Managing Director

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EMERGING LEADERS UPDATE

Evelyn Morris | ELS President Arkansas Bankers Association

The year 2020 is emerging as a litmus test to discover leadership. No leader in our industry has experienced times such as these; there is no manual or guide book, no number of prescribed years of experience that could prepare us for 2020. In times of uncertainty and chaos, leaders emerge. Look around, are there individuals in your bank who have stepped up to the challenges of today? Those who have gracefully endured today’s tests and trials? Those who have professionally transformed to a whole new level over the course of this year?

These are your leaders!

Work environments changed overnight! A new “work/home” dynamic has materialized with schools closing, businesses closing, and employees working remotely, learning to navigate through ever-changing regulatory guidance. Disaster recovery plans are being tested and many will fail, but with these deviations from the norm being thrown at us we learn and we grow. In order to succeed we must change. You may have started 2020 in a leadership role, but there is no surviving 2020 a good leader without being completely transformed and humbled. The good news is good leaders know how to pivot, they know when to ask for help, they know when to admit failure, they know when to “reset” with a new plan while keeping the overall vision on track, they know how to adapt and think outside the norm in order to excel.

So, how do you think leadership has changed during 2020?

Or has it? Has the definition of effective, good leadership changed? Have the same fundamentals and characteristics of a good leader remained with 2020 making your stars shine a little brighter? Have you watched new leaders emerge?

One initiative the Emerging Leaders Council set forth this year is to assist Arkansas’s bankers in identifying the emerging leaders in their banks. We are often asked, “Who should attend the Emerging Leaders Conference? Who serves on the Emerging Leaders Council? Is there an age requirement? Is there a title requirement? What kind of job duties does an emerging leader perform?” Bottom line, an emerging leader can be anyone. To better help you identify these individuals in your bank, we have created “Emerging Leaders Campaign” posts on the Arkansas Bankers Association social media platforms. These posts give you a quick snapshot of each of our council members. The diversity in these leadership profiles is glaring. There is no age requirement or responsibility level.

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The Arkansas Banker n Fall 2020

Who is your go-to person when you need a project completed or when you simply need to brain storm ideas? Who are the individuals you want to keep secretly “hidden” so your competition doesn’t try to hire them out from under you? Who are the morale boosters and the influencers? Whose faces do you see in your mindful succession plan? Who do you see stepping forward in your contingency plan? Who just popped into your mind? Ding, Ding, Ding… These are your “emerging” leaders!

Here’s the deal though… Emerging leaders are those leaders who have not yet reached their full potential. The year 2020 is a great window of opportunity for established leaders to invest their time in mining tomorrow’s leaders. There are lessons to be learned and relations to be built. This is a time to grow future leaders through mentoring programs and fostering relationships with staff members eager to learn. If you were to ask any proven leader to recall what made them a good leader, each one would likely point back to a person of influence they had encountered along the way. Each one would most likely begin to recite words of wisdom and stories shared that they carry through the ages in their own personal “bag of tricks.”

This “bag of tricks” is nothing more than the collective advice of mentors, peers, and service personnel that all good leaders gather over time and then positively distribute amongst their co-workers, customers, and communities they serve. As a leader of today, how are you investing in the leaders of tomorrow?

As part of our campaign the Emerging Leaders Council members were asked the following questions: • What is the most important leadership lesson that you’ve learned?

• What’s your biggest leadership struggle?

• What is the most effective daily habit you possess?

• What is the greatest advice you have ever been given?

• What does effective leadership look like to you?

• How has leadership changed in 2020?

One of the most common themes in the responses was effective leaders lead by example and by action. They are willing to do everything they expect their team to do. They earn the respect of their team by clearly communicating and practicing what they preach. If asked, how would you respond to the above questions? How would your management team respond? How would your staff respond? Please take the time to engage your team. You may discover a new leader or learn something new about your leadership style. I invite you to jump on over to the ABA Facebook page to read our council members responses.

Northwest Arkansas Gets a New Partner Partners Bank is excited to welcome Micah Thompson to our team as Northwest Arkansas Regional President and Chief Credit Officer. Micah, a 20-year resident of Northwest Arkansas, brings a depth of experience, knowledge and innovative thinking to Partners Bank’s expansion to the area.

Every bank in this state has emerging leaders. Invest in them, empower them, send them to the Emerging Leaders Virtual Conference on October 22nd and get them engaged with the ABA! (Stay tuned for more details about the conference.)

If your emerging leaders are not obvious to you at this point, I challenge you to assess your staff, develop an internal mentorship program, or hire a leadership consultant to help you identify opportunities. Use some time to reflect on your career and any changes you can envision to unleash the emerging leaders around you. In the words of John Maxwell, “Leaders become great not because of their power but, because of their ability to empower others.” Empower others… and those you empower will emerge to lead.

Micah Thompson Northwest Arkansas Regional President and Chief Credit Officer

Contact Micah at 479-301-9926 or by email at mthompson@partnersbnk.com to discuss any of your banking needs.

Helena / West Helena / Marvell / Wynne / Marion

partnersbnk.com

870-338-6451

SECOND ANNUAL BILL HOLMES LEADERSHIP AWARD Nominate a Rising Star!

In honor of former Arkansas Bankers Association President Bill Holmes (1949-2018), the Association proudly presents the second annual Bill Holmes Leadership Award. This prestigious distinction will recognize outstanding leadership among the emerging leaders in Arkansas banking. Please consider nominating rising stars in your institution who contribute to team success, industry success, and make an impact on their community.

One statewide award and scholarship will be presented during the 2020 Virtual Emerging Leaders Leadership Conference. Nominations will be accepted from any member source. Nominees must be a current banker and member of the Arkansas Bankers Association. Nominees should have the equivalency of the rank of vice president or below and should not be a current member of the Emerging Leaders Council.

All nominations are due by Sunday, September 21, 2020.

The Arkansas Banker n Fall 2020

15

The Evolution Digital Borrower Experience of the

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The Arkansas Banker n Fall 2020

by Dean McCall & Laura Mays

t

he COVID-19 pandemic has turbo-charged banks’ drive to embrace digital mortgage technology, and customers aren’t just along for the ride. Their attitudes toward technology use are evolving, too.

As the effects of the pandemic have reverberated across the U.S. economy since March, banks—by necessity—have shifted increasingly toward electronic delivery of a wide range of services, including mortgages. The same, of course, goes for borrowers. The shift toward digital mortgages coincides with an 11-year-high in purchase applications. The pandemic has not cooled the pent-up demand for purchase mortgages, and record-low long-term interest rates have fueled that demand while also triggering a surge in refinancing activity.

Amid this mortgage boom and the concurrent shift toward greater use of mortgage technology, bankers have been able to demonstrate clearly to borrowers digital lending doesn’t equal low-touch or diminished quality of service.

On the contrary, our analysis shows borrowers in the COVID-19 environment are more likely to lean on a loan officer during the application process, even in the vast majority of cases where applications were being completed electronically. Digital delivery works best when a loan officer can work hand-inhand with a borrower, educating and guiding them through the process.

Our analysis of representative banks found before COVID-19 struck, about one in four borrowers came into the bank to sit down with a loan officer to initiate the digital application, while the rest got started at home. Not surprisingly, COVID-19 reduced that ratio to about one in seven, and for borrowers working with our client banks, there was no loss in service quality. In fact, loan delivery as measured by days from application to closing actually sped up by four days.

The picture emerging from our experience and observations is that borrowers are finding it easier to complete an application online than on paper—especially when a knowledgeable loan officer is available to copilot the application process digitally, guiding them through the steps.

In the wake of COVID-19, banks that were once agnostic about which delivery channels to use are now willing to push to digital processes, having seen improvement in efficiency, customer satisfaction and ease and speed of delivery. And, electronic delivery, including digital compliance documents, can greatly reduce the mountains of paper that once defined the mortgage experience.

A cutting-edge virtual experience helps to break down fear by simplifying what can be a very daunting process. A mortgage, after all, is the largest financial transaction most people undertake.

There’s a tendency to think older customers require more hand-holding, but interestingly, that is typically not the case.

Most older borrowers have been through at least one mortgage application. Ironically, younger borrowers can require more attention to get them to stick with the loan application to completion. They are the most comfortable with technology but the least familiar with the mortgage process. The questions that pop up on an online mortgage application can feel excessive and intrusive to these customers, who tend to have high levels of discomfort surrendering private financial information. They are protective of their financial privacy and, without a clear understanding of the mortgage process, want to know why they are being asked for every jot of information.

A well-designed customer experience addresses this challenge through crisp, clear design showing exactly why information is being requested, without overloading the borrower with extraneous detail.

An intuitive and appealing customer-facing dashboard is a critical feature of any digital lending platform. Bankers and their customers have a clear preference for a streamlined product that makes it easy to register and sign in, showing borrowers where they are in the process every step of the way. Banks should not underestimate the role language plays at each stage in the application. Banks see the benefit of a dashboard using confident, friendly and reassuring language to help borrowers understand how their personal financial information will be used to build the loan file needed to reach a mortgage decision.

And, as customers are asked to upload information, they should find it as simple as possible to do so, ideally using a one-button design to click and send a document. Customers should be reassured the information they securely submit goes straight to their loan officer and their lending team.

With challenges to in-person interactions magnified by COVID-19, the ability to transact digital mortgage services has become even-more critical to success. But borrower behavior during COVID-19 has demonstrated that while borrowers want—and indeed require—a digital experience, they don’t want to surrender loan officer guidance and support. Banks adopting digital lending platforms should prioritize solutions that empower customers, giving them control of how much— or little—they want to interact with a loan officer.

Dean McCall is managing director and Laura Mays is manager, data insights, for Promontory MortgagePath, which is endorsed

by ABA for residential mortgage loan fulfillment.

This article originally appeared in the ABA Banking Journal and is reprinted here with permission.

The Arkansas Banker n Fall 2020

17

Updates from the Courts

by Justin T. Allen Attorney • Wright, Lindsey, & Jennings, LLP

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The Arkansas Banker n Fall 2020

Supreme Court Rules CFPB Structure is Unconstitutional

Paycheck Protection Program (PPP) – Broker’s fees

In Seila Law LLC v. Consumer Financial Protection Bureau (CFPB), the United States Supreme Court held that the CFBP’s single-director is unconstitutional. The challenge was based on the fact that the CFPB is led by a single director and removable by the President only for cause. The Plaintiff alleged that structure was a violation of separation of powers.

Numerous lawsuits have been filed around the country by brokers and accountants seeking an agents’ fee from the lender issuing a PPP loan. One such lawsuit has been filed in Arkansas federal district court.

The Supreme Court, in a 5-4 decision, agreed with the Plaintiff. The Court concluded that CFPB’s structure lacked the necessary presidential oversight. The Court emphasized that the Constitution “scrupulously avoids concentrating power in the hands of any single individual” other than the President. According to the Court, the CFPB’s single-Director structure “contravenes this carefully calibrated system by vesting significant governmental power in the hands of a single individual who is neither elected by the people nor meaningfully controlled (through the threat of removal) by someone who is.”

The Court did not, however, strike the Dodd-Frank Act. Rather, it severed the for-cause removal provision from the law.

On a related note, the Court also recently agreed to hear a case regarding the constitutionality of the Federal Housing Finance Agency’s (FHFA) structure (Collins v. Mnuchin). As with the CFPB director, the statutory scheme only allows for removal of the FHFA director “for-cause.”

Supreme Court Declines to Review Credit Union Field of Membership Decision In late June, the Court declined to take up the case of American Bankers Association (AmBA) v. National Credit Union Administration (NCUA). The Court was asked to review the D.C. Circuit Court of Appeals case regarding the reasonableness of the NCUA’s interpretations of “local community” and “rural district” in its 2016 field of membership rule. Accordingly, the Court of Appeals ruling that largely upheld the rules stands as the law.

In the Final Rule, NCUA defined any “Combined Statistical Area,” or portion of such an area, as a “local community,” so long as the area’s population does not exceed 2.5 million people. Every Combined Statistical Area includes multiple “CoreBased Statistical Areas.” NCUA also increased the size cap for “rural districts” to 1 million people. The D.C. Circuit upheld the agencies rules and interpretation of them.

In arguing for review, the AmBA pointed out that sprawling regions containing dozens of cities and counties automatically qualify as single local communities, as do narrow strips of land connecting cities hundreds of miles apart. AmBA also argued that NCUA’s interpretation of rural district is unreasonable. Under that interpretation, five entire states each qualify as “rural district[s],” as do vast multistate regions in which nearly all of the population lives in major metropolitan areas.

The fundamental allegation in the lawsuits is that the PPP provisions of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) required lenders to pay an agent’s costs out of the fees lenders receive from the Small Business Administration (SBA). The relevant SBA rules states that “[a]gents may not collect fees from the borrower or be paid out of the PPP loan proceeds.” The rule also states that “[a]gent fees will be paid by the lender out of the fees the lender receives from SBA.” This language serves as the foundation for the lawsuits.

Banks have pushed back by filing motions to dismiss arguing that neither the CARES Act nor the SBA rule require reimbursement by the lender. Rather than creating an obligation, the rule simply caps how much the agent may recover, the banks argue. Without an agreement between the agent and the bank, there is no legal obligation to pay the agent anything During a House Financial Services Committee (HFSC) oversight hearing on June 30, 2020, Treasury Secretary Steven Mnuchin made statements consistent with the arguments put forth by defendant banks. He explained that his department’s guidance thus far has said that banks “could pay agent fees out of the fees that they received”—not necessarily that they must. Mnuchin additionally explained that the intent was not to make such reimbursement automatic, but for it to “be based upon a contractual relationship between the agent and the bank.”

As of the date of the writing of this summary, one federal district court in Florida has agreed with the defendant banks and dismissed the Plaintiff’s claims against the lenders. The Court held: “Here, it is undisputed that neither Plaintiff nor the borrowers executed Form 159, nor did they have agreements with Defendants regarding payment for the work Plaintiff performed in assisting borrowers in obtaining PPP loans through Defendants. Accordingly, Defendants have no legal obligation under the CARES Act or the IFR to pay Plaintiff an “agent fee” for helping the borrowers get PPP loans from Defendants . . . “ The litigation will continue to play out in the coming months, but the initial battles seem to be going well for the lenders.

The Arkansas Banker n Fall 2020

19

Forgive...

But Don’t Forget

By Brandon Horvath

b

y now you may be tired of hearing about COVID-19 and the financial recovery programs that resulted, specifically the Paycheck Protection Program (PPP).

However, these loans are still top-of-mind among small business owners, as the first wave of applications seeking forgiveness begins.

The program was designed so that businesses would not have to repay the loans if they met certain provisions, such as retaining workers on the payroll for eight weeks. But confusion about how to calculate forgiveness is widespread.

Small business owners wanting to maximize their PPP forgiveness are waiting for answers.

Ultimately, lenders will be at the forefront of forgiveness, with assistance from the Small Business Administration and borrowers’ accountants.

The team at the Arkansas Small Business and Technology Development Center has closely monitored the guidance on PPP forgiveness. Each webinar, conversation, or article offers a slightly different position, based on the timing or the presenter’s interpretation of the rules.

We do know forgiveness starts with the borrower completing the PPP Forgiveness Application. ASBTDC consultants are encouraging clients to complete what they can of the application and provide a copy to their CPA for an accuracy check and to help fill in the gaps.

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The Arkansas Banker n Fall 2020

By taking this approach, the burden of completing the application itself moves away from the lender, and borrowers are better prepared to discuss how they spent the PPP dollars.

The primary purpose of the PPP was to encourage small business owners to keep the same number of employees on their payroll at the same pay scale. The U.S. Chamber of Commerce does a nice job of breaking down the elements of forgiveness in their Guide to PPP Loan Forgiveness.

They start with these steps for calculating the forgiven amount: 1. Determine the maximum amount of possible loan forgiveness based on the borrower’s expenditures during the eight weeks after the loan was made; 2. Determine the amount, if any, by which the maximum loan forgiveness will be reduced because of reduced employment or reduced salaries and wages; and 3. Apply the 75% rule that requires that at least 75% of eligible loan forgiveness expenses go towards payroll costs.

But there are still a lot of unknowns.

• Will Congress extend the eight-week period that businesses can spend the loan proceeds?

• Will the rule change requiring at least 75% of the PPP funds be spent on payroll?

• Will the documentation requirements evolve as forgiveness applications are submitted?

While small business owners are keenly interested in PPP forgiveness, they are also beginning to think past COVID-19 to the future.

"The program was designed so that businesses would not have to repay the loans if they met certain provisions, such as retaining workers on the payroll for eight weeks.

But confusion about how to calculate forgiveness is widespread."

There are many lessons businesses can learn from this pandemic. One of the most important lessons is that the marketplace can change rapidly. In order to survive and even thrive, businesses must understand customers' changing wants and needs and take a strategic approach to creating value.

Through our no-cost confidential consulting, ASBTDC engages business owners in these conversations, so the next time something unexpected happens, they are better positioned to weather the storm.

Small business lenders and community banks are also adjusting. In conversations with Arkansas lenders, it is inspiring to hear that most understand that the way they manage customer relationships during this difficult time will either build or diminish customer loyalty in the future.

Taking this idea to heart, small business lenders are investing in education and information-gathering around SBA’s flagship loan guarantee programs. Today, banks are cautiously lending to startups and businesses seeking to grow. The SBA guaranty brings added security.

Finally, community banks are leading the way in creating online portals, digitalizing loan applications, reviewing loan criteria, and developing new financing tools to support small businesses in their recovery efforts.

While the pandemic will likely have long-lasting effects on the small business sector, resilient Arkansas small businesses are beginning to move past the initial crisis and start planning for the future.

(Accurate as of June 1, 2020)

About the Author

Brandon Horvath is the capital access specialist at the Arkansas Small Business and Technology Development Center based at the University of Arkansas at Little Rock.

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Winter 2019

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8 CIII, No.

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CIV, No. 9

What better way to get your services out to Arkansas bank CEOs, presidents and marketing personnel than through the pages of the Arkansas Banker magazine. Our quarterly magazine is sent to banking institutions statewide.

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The Arkansas Banker n Fall 2020

21

Foreclosure Protection Where are We Now?

t

By Chris W. Bell

he COVID-19 pandemic has changed American life as we know it. As the country continues to deal with the health crisis, the effects of containment measures ripple through the American economy. Unemployment remains high as state economies expand and contract in inverse proportion to the virus’s spread. Regulators are in an arms race with rapidly changing markets, forcing banks to adapt to an ever-changing regulatory landscape. Even as we struggle to deal with the immediate concerns, we know the effects of this pandemic will be with us for some time. Economic shocks will continue to reverberate and play out in the housing markets around the country. As we shift into the next phase of operating in the pandemic and consider what options exist to help struggling mortgage borrowers, we should take note of the status of the expansive mortgagor protections passed by Congress, federal agencies, and other government authorities.

moratorium on foreclosures and evictions until at least August 31, 2020.

Protection for Federally Backed Mortgage Loans

State and Local-level Protection

In the early days of the pandemic, Congress passed the Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. One of the primary sections of this law established a 60-day moratorium on foreclosure proceedings against homeowners with federally-backed mortgage loans. The CARES Act’s mortgage foreclosure moratorium applied to single-family residential mortgage loans secured, guaranteed, or made by FHA, USDA, VA, or Fannie Mae or Freddie Mac. Originally scheduled to expire at the end of June, the various agencies extended the

Many state and local authorities enacted policies to protect mortgage borrowers and renters. The details of these state and local foreclosure bans vary. Banks should refer to the official websites for their state and local governments to assess the scope and requirements of applicable prohibitions. While effective dates vary widely, many of these protections remain in effect until respective governors lift statewide emergency declarations.

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The CARES Act also granted Federally backed mortgage loan consumers experiencing financial hardship related to the COVID–19 pandemic, the right to request six months of forbearance (with an option of six additional months), regardless of delinquency status. Congress prohibited servicers from charging any fees related to this forbearance. Mortgage delinquency status is frozen in place during forbearance, even if the bank suspends payments during the forbearance. As it stands today, customers can request forbearance under the CARES Act until the earlier of the end of 2020, or the end-date of the national emergency concerning the novel coronavirus disease outbreak declared by the President on March 13, 2020, under the National Emergencies Act.

Private loans The CARES Act provided no relief for loans that are not federally-backed. Banks should refer to the appropriate investor guidelines for mortgages sold to private investors. Banks should refer to guidance from its regulators concerning their expectations regarding non-federally-back mortgage loans held in portfolio.

Troubled Debt Restructuring (“TDR”) If neither a federal nor state moratorium applies to a residential mortgage you hold in portfolio, you may still be able to exercise your authority to assist pandemic-effected borrowers who are struggling financially. Regulators have urged banks to work with customers and prudently modify loans in a safe and sound manner. Section 4310 of the CARES Act provided banks relief from TDR. In April, regulatory agencies issued revised interagency guidance to help banks sort modification requests into three groups: (1) loan modifications covered by Section 4310 of the CARES Act; (2) those outside of Section 4310 deemed not to be TDRs; and (3) those outside of Section 4310 that may be TDRs. In June, regulators released new interagency safety and soundness examiner guidelines. These guidelines instruct examiners to not criticize institutions for doing so as part of a risk mitigation strategy intended to improve existing loans, even if a restructured loan ultimately results in adverse credit classifications.

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To be covered by Section 4310 of the CARES Act, a loan modification must: (1) relate to COVID-19, (2) be executed between March 1st and December 31st (assuming the current national emergency does not end earlier than the end of the year), and (3) the underlying obligation must be not more than 30 days past due. If a loan modification meets these three criteria, financial institutions do not have to report it as a TDR; however, the financial institution should maintain records of the volume of such loan modifications.

If a loan modification fails to meet any of the three criteria for Section 4310 coverage, it does not automatically result in a TDR. Regulators will deem a modification as not to constitute a TDR if it relates to COVID-19, extends no more than six months, and the underlying obligation is not more than 30 days past due. The only subjective criterion is the relationship of the modification to COVID-19. As a best practice, banks should have the borrower certify that the requested change is due to COVID-19. To not raise HIPAA concerns, the certification should be general and not address specific health details. While such a certification is not required to be in the loan file, it would show future examiners that the lender followed the guidance in good faith.

If a bank receives a modification request that is outside the scope of Section 4310 and does not meet the described criteria, the bank should assess whether the modification would be a concession to the borrower that the bank would not otherwise consider and act accordingly.

As with everything related to the COVID-19 pandemic, expect mortgage foreclosure protections to change as the county continues to deal with the long-term effects of our national crisis. The federal agencies may extend the protections relating to the loans they back, and Congress will undoubtedly reassess the CARES Act’s protections as the end of its covered period draws near. Despite how things change, you can count on the Texas Bankers Association to bring you the most up-to-date information available as we walk hand-in-hand through this crisis.

About the Author

Chris W. Bell is an Associate General Counsel at Compliance Alliance. He has worked in the legal department of a federal savings bank and for the Texas Department of Banking. He is one of the C/A hotline advisors.

Donna Spakes donna@flicar.com 501.519.0555 | 800.446.2214 flicar.com

The Arkansas Banker n Fall 2020

23

A Solemn Farewell to Reg. D’s Convenient Transfer Restrictions

e

ffective April 24th, 2020, the Board of Governors of the Federal Reserve System (“Board”) did away with a longstanding, and, in the opinion of some, outdated rule in Regulation D. The Interim Final Rule amended Reg. D by deleting the six convenient transfers and withdrawals restriction that has become synonymous with savings accounts.

Additionally, recent guidance has further clarified aspects of the rule change raised by the Interim Final Rule. Because the rule change puts the ball in each depository institution’s court, in terms of whether to continue enforcing transfer restrictions, banks are now left at a crossroads with compliance considerations in proceeding down either path.

With the Reg. D restrictions being antiquated for years due to changes in the industry, what precipitated Reg. D’s amendments now? In the Interim Final Rule, the Board noted an “ample reserves regime” monetary policy shift, which led to the Board reducing reserve requirement ratios to zero percent effective March 26, 2020. As a result of the elimination of reserve

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By Michael Perez

requirements on all transaction accounts, the Board stated that the distinction between transaction accounts and savings deposit accounts was no longer necessary. Lastly, the Board pointed to disruptions caused by COVID-19, which in turn has caused many depositors to have an urgent need for access to their funds by remote means.

Because the Board pointed to recent developments as a bases of the change, as well as its timing amidst the COVID-19 pandemic, has led some to question whether the Reg. D changes are permanent or only temporary in order to provide relief during the current crisis. The Interim Final Rule as currently written did not indicate that these changes are temporary. Additionally, The Federal Reserve Banks (“Banks”) further clarified in a recent FAQ that the Board does not have plans to re-impose transfer limits but may make adjustments to the definition of savings accounts in response to comments received regarding the Interim Final Rule as well as potentially in the future, if warranted.

"The Interim Final Rule amended Reg. D by deleting the six convenient transfers and withdrawals restriction that has become synonymous with savings accounts...

The Interim Final Rule as currently written did not indicate that these changes are temporary."

With the question of the Interim Final Rule’s permanency being somewhat clearer, it is worth noting that many changes caused by rule are indeed clearly explained. For example, the rule explains that enforcement of the changes is not mandatory. Instead, it is completely up to each bank whether to suspend enforcement of the six transfer limit and even provides that a temporary suspension is an option. Additionally, the rule allows a certain amount of flexibility in that a bank that suspends enforcement of the transfer limits can either continue to report these accounts as savings deposits or alternatively report them as transaction accounts for purposes of the FR 2900. Further, the rule does not require reclassification or name changes for effected accounts.

Because it is up to each bank on whether to suspend enforcement of the six transfer limits, one of the most frequent questions we have received is whether notice is required when suspending enforcement. Neither the Interim Final Rule nor relevant guidance regarding the Reg. D changes have specifically stated notice is required. Additionally, Regulation DD only requires advance notice in certain circumstances which suspension of transfer limits would not trigger. Even though not specifically required by regulation, providing notice is considered a best practice from a customer relationship and UDAAP perspective when significantly changing the terms of an account. Additionally, for those institutions that will be suspending enforcement of the transfer limitations only temporarily, generally Reg. DD would require advance notice when re-implementing the transfer restrictions, as this would adversely affect the consumer. We have heard from many banks that plan to temporarily suspend enforcement of restrictions plan on providing a statement notice informing the customer of the change and indicating the date on which the restrictions will be re-implemented.

Another issue presented by the change is whether it is necessary to amend account agreements. While the Interim Final Rule does not specify the manner in which account agreements may be amended, the issue of whether they should be amended remains open. If choosing to suspend enforcement

of the restrictions, this would arguably lead to a conflict between the depository institutions practices and the current terms of the account agreement. Additionally, even if not suspending enforcement of the restrictions, it is common to cite Reg. D as a source of the restrictions, which is no longer the case anymore. Either of these issues could cause compliance issues for a depository institution and therefore should be taken into consideration in determining how to proceed.

Lastly, it initially appeared that the Reg. D amendments had caused an unintended consequence concerning Regulation CC. Because Reg. CC defines “account” by referencing Reg. D’s amended definition of “transaction account”, it appeared that this had caused a conflict within Reg. CC and presented a question of whether saving deposit accounts were now subject to Reg. CC. The Board clarified the impact of the Reg. D amendments on Reg. CC in a recent FAQ. The Board provided that because Reg. CC continues to exclude savings accounts from Reg. CC’s “account” definition, the amendments did not result in savings deposits now being covered by Reg. CC. While banks still have to decide whether they will suspend enforcement of the restrictions as well as tackle compliance considerations either way, ultimately the elimination of the convenient transfer restriction will relieve banks choosing to suspend enforcement the burden of having to monitor for excessive transactions. Additionally, for bank’s opting to suspend enforcement, the changes will benefit account holders by providing greater accessibility to funds. While there will be effort and resources required in implementing these changes, overall it appears the Reg. D changes have the potential of providing a net benefit to banks and account holders alike.

About the Author

Michael Perez presently serves as Associate General Counsel for Compliance Alliance. He holds a bachelor’s degree in Business Administration in Finance from the University of Texas McCombs School of Business. While attending Baylor Law School, he further pursued his interest in finance by taking a variety of courses that focused on transactional and business issues. After law school, Michael worked at a litigation firm with a specific focus on collection matters.

Now is the time to get a 2020-21 ABA Bank Directory!

Go to www.arkbankers.org for more details.

The Arkansas Banker n Fall 2020

25

Small Steps to a Greener Bank

Article Courtesy of Office Depot

f

inancial organizations such as banks have not historically been thought of as having significant environmental impacts. However, this reasoning is myopic. Banks and other financial services firms can have a multitude of direct and indirect environmental impacts: from the products and services they buy, to the everyday commuting and travel of their staff, to the buildings they occupy and the waste they generate. Since it is actually demand for products, buildings and fuel that drives upstream environmental impacts, shifting demand to greener alternatives can significantly reduce environmental impacts.

Step One: Ask Why Green?

Before starting a green program, the most important first step is to ask why go green? For a greening effort, this may be done most effectively with a small “green team” of interested people at every level, across functions. It is useful to include a representative from upper level management as the “champion”, a senior manager with overall responsibility for implementation, a facilities manager, a purchasing manager and an administrative assistant.

The following fundamental questions can be used to prioritize your efforts.

1. Ask what are the bank’s main environmental impacts? In banks, common impacts include paper and office supplies purchases, printing, text purchases, technology purchase and use, landfill waste, travel to client meetings, electricity, and new building construction.

2. Ask where are these impacts more significant – at the bank’s head office or at its branch locations? In certain departments or equally across the bank? Answers to these questions will help you focus on reducing your most material environmental impacts.

3. Ask which environmental issues matter most to the bank?

This may be as much a personal question as an organizational one, and there may also be a link between the two: does the bank have a stated interest in energy and climate change?

Deforestation and biodiversity? Reducing toxic chemicals?

Minimizing waste? The bank’s main concerns could drive first actions.

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The Arkansas Banker n Fall 2020

4. Ask how does the bank approve or disapprove of new programs? Are budgets constrained and cost savings critical or are there opportunities to invest in ideas that deliver returns over time? What is the timeline for payback? Answering these questions can help establish your bank’s priorities.

Step Two: Buy Greener

Since purchasing drives environmental impacts up the supply chain, buying greener can help reduce impacts all the way up that chain.

• “Greener” products…that help reduce the environmental impacts most important to the bank…while focusing on the highest expense categories…in each office or offices where the bank spends the most on these products.

Another consideration is how green does the bank want to buy? Historically “green” has been a binary concept: products have been considered “green” or “not green.” But this is a flawed simplification. There is a continuum of green-ness: from not green to light green to dark green. Any product -- even if it has just a minor green benefit -- is likely “greener” than another without that benefit. The greenest products deliver maximum environmental benefits across the product lifecycle.

Cost and Quality Considerations

A recent Supply Chain Study (The Green Supply Chain, published by CSC, Manhattan Associates and IBM) confirms that concerns about cost justification constitute the most significant barrier to implementing a sustainable supply chain strategy. But while buying green may mean spending more for some products, the reality is that over a “basket of goods” it can be less expensive in the long run to go green at the office.

Don’t believe it? Within the office context, calculate how much money is spent on new ink and toner cartridges. By switching to remanufactured cartridges a typical bank can save over 10% of what may be a large sum. The quality of remanufactured cartridges has improved significantly recently – today’s remanufacturing processes result in high quality, guaranteed cartridges that work effectively every day.

The second major category of purchasing in banks is often paper. Buying recycled paper products can help divert this resource from landfill into new paper products. Just as the quality of remanufactured cartridges has improved, so has the quality of recycled paper products.

Think before you print and print double sided: Financial industry professionals often have a strong predilection to printing, then filing. Keeping documents electronically not only saves paper but simplifies searching. By printing double-sided you can save up to 50% on paper costs. .

In addition to products that feature the benefits of containing recycled content, office products may contain a wider range of other green benefits. Durable and refillable pens and pencils can generally be considered greener than disposable; biodegradable packaging and dishware can generally be considered greener than Styrofoam. All of these choices help reduce the pressure on resources and can result in less waste.

Recycle everything you can: Recycling programs can be set up for almost every end-of-life material in every office of a bank. The office facilities manager can work with local waste authorities and shredding firms to recycle recyclable products.

Another category of products to consider in a quest for a greener bank is technology. Climate change is one of the most significant environmental issues of the day. One main solution to climate change is to use less electricity. Using energy efficient products can lower utility costs and reduce the carbon emissions associated with climate change. Smaller items like laptops or LCD panels also provide green benefits because these products generally draw less energy than larger alternatives.

Finally, switching employee desk-lights to Compact Fluorescent Lightbulbs (CFL) and retrofitting office lighting may represent a very quick and cost-effective way to reduce energy costs and carbon footprints.

Step Three: Be Greener

Buying green means using purchasing dollars to encourage greener products in the supply chain. But “being green” need not cost a dime. To start being greener in the bank, consider five simple tips: Switch off to save: Encouraging employees to turn off lights and computers while not working - day or night - can save energy and reduce utility bills and carbon emissions. By plugging all your electronics into a power strip – all the office equipment can be turned off in one go.

Drop the disposable cups and bottles: Using a reusable mug for coffee and a glass for water can help reduce waste and resource use and save the bank money.

Work to reduce fuel: Working with suppliers also affords opportunities to be green and reduce fuel. By consolidating orders or switching to biweekly or weekly delivery schedules for regularly shipped items - such as office supplies - greenhouse gas emissions associated with every day delivery can be reduced.

Step 4: Sell Green

Once the bank’s “green team” has decided what to do, one of the realities of green efforts is that organization-wide support is, at least initially, not necessarily enthusiastic. But “new green” thinking is about not forcing change onto unreceptive audiences, but encouraging small steps in a greener direction without being imposing.

By helping people within the bank see that they can personally benefit from greener office programs, they are more likely to join the efforts than resist it. To “sell green” it is also important to debunk some myths. Running pilots on greener products and developing simple financial models to show how buying green and being green can save money can help convert even the most ardent naysayers.

Step 5: Tell Green

Finally, there is nothing that encourages like positive reinforcement. Celebrate the bank’s achievements by creating a website or report detailing your progress. Telling customers, competitors, and employees about your green programs can help them understand and appreciate them. By celebrating even small wins with communication, events and press releases, you can create momentum for broader green office efforts.

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Ian Bryan Community Banker - Commercial Lending Simmons Bank, Russellville, AR

What can banks do to better appeal to millennials – in the workforce and as customers?

As I embrace the world of the millennials (oddly, generational labeling may never change), expectations for how I choose to manage financial goals and processes for my life may vary slightly from other generations. Even as I view my role in the banking business, quick access to information is key and often critical to decision making for personal and business needs. Online services, through the use of mobile banking, offer me enhanced efficiencies and ready-services while I’m on-the-go. Also, online paperless account management services become an invaluable tool to assist in oversight and organization of finance information, making access available at my demand. As banking services continue to evolve, the ability to handle personal and workplace processes for personal or business accounts, loans, and even investments services with expediency, ease, accuracy and security is necessary. The challenges for meeting the expectations of internal and external partners and customers offer exciting opportunities for the present millennials and future generations (even with the on-going labeling).

What technology innovation has made the most impact on your life?

As mentioned above, the growth and enhancement of mobile device capabilities has changed the world in ways that are presently apparent. However, as this technology continues to develop over the next 5 to 10 years, the growth of personal and business processes can be almost limitless for future banking services. The “total” virtual bank may just be the next reality.

What civic project has your bank participated in that touched you the most?

Although the role of banking generally involves providing financial services to customers and clients in a local community, the connection with the residents in an area serves as a means to positively influence community involvement. A recent outreach by Simmons Bank, the Walk to Defeat ALS, brought many residents together in an effort to raise money for a very important cause, finding a treatment and a cure for Lou Gehrig’s Disease. As an athlete since my early childhood through college, and learning about Mr. Gehrig and his battle with ALS, it was an honor to recognize his life through the fund-raising efforts of Simmons Bank.

This project made a huge difference in the support of those affected by this terrible disease, even our very own Simmons First Foundation Chairman, Mr. Tommy May. What can you simply not resist?

A never-ending supply of a Rico Suave Jackhammer (Vanilla frozen custard blended with roasted pecans and Oreos, with a center filled with hot fudge) from Andy’s and an under-par round of golf at Augusta National. However, to stay within the banking industry topic, it would be almost impossible to resist the opportunity of creating services that met all the needs and desires of our banking customers and clients.

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UNDERSTANDING

coins

DURING THE CORONAVIRUS OUTBREAK

Ways Pandemic Ways to to Collect Collect Coins Coins from from Customers Customers During During the the COVID-19 Covid-19 Pandemic The announced that coin circulation hashas slowed during the COVID-19 Pandemic.

TheFederal FederalReserve Reservehas has announced that coin circulation slowed during the Covid-19 PanIndemic. order to meet customer demand, here are some tips for increasing coin deposits in your institution In order to meet customer demand, here are some tips for increasing coin deposits in your and to help coinincrease circulation. institution increase and to help coin circulation.

1. Offer free coin counting.

Many banks have coin counting machines. Offer use of these machines at no charge to help customers convert coin holdings to cash, or, even better, deposits!

2. Create an education opportunity!

With many many children children at at home home due due to to the the COVID-19 Covid-19 With pandemic, counting counting coins coins creates creates aa great great math math lesson lesson pandemic, for children children as as well well as as the the opportunity opportunity to to learn learn about about for money! money!

3. Offer free coin wrappers.

Providing customers a means of organizing their coins at home increases the likelihood of customers combining coins into an aggregate tangible sum to be deposited at your bank.

4. Empty out the piggy banks!

Many children get piggy banks as a gift when they are children but sit untouched with accumulated coins. Encourage customers to empty out of those piggy banks and create tangible savings towards a goal!

5. Earn money on the coins.

Educate customers sitting at the house are not earning interest. There are many options Educate customersthat thatcoins coins sitting at the house for opening accounts that earn interest including some are not earning interest.

There are many options foraccounts for minors. opening accounts that earn interest including KY The Arkansas Banker n Fall 2020

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Force Majeure In Arkansas:

Contractual Provisions and the COVID-19 Pandemic

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by Timothy W. Grooms & Robbi Riggs Rosenbaum

any Arkansas businesses are temporarily shutting their doors in light of COVID-19, leading to uncertainty regarding the status of their contracts. Most contracts have a "force majeure" clause, in which the parties agree to waive some or all responsibilities in light of unexpected activity constricting a party's operations. Parties should understand their rights and responsibilities under their contracts as they consider how to respond to the evolving COVID-19 situation.

Language of the Clause

Parties seeking to suspend performance should first look to the language of their contract's force majeure clause, which must include language encompassing COVID-19. If the clause includes examples like "pandemic" or "quarantine," the party should be able to invoke the clause. However, most force majeure clauses are not so specific. If the clause references a "government action" or "government order," a party could argue that certain mandatory governmental directives excuse performance under the clause.

Most force majeure clauses include a catch-all phrase referring, for example, to all other acts not reasonably within control of a party. Arkansas courts, however, limit these catch-all phrases to situations resembling the clause's specific terms. On the other hand, courts would interpret the catch-all provision broadly when the force majeure clause contains no specific terms.

Impossibility

To qualify for excusal under most force majeure clauses, the COVID-19 pandemic must make continued performance legally or physically impossible. Legal impossibility encompasses circumstances where government restrictions make performance illegal, giving businesses facing mandatory closures the strongest case. Physical impossibility, on the other hand, is difficult to prove. For instance, a state may strongly recommend that its residents avoid public places in light of COVID-19, leading foot traffic at a tenant's business to dissipate. The tenant cannot claim excusal under the force majeure clause based on the decline in business, for operation is still physically possible.

Alternatively, the force majeure clause may be broader, encompassing acts making performance "impossible or reasonably impracticable." However, parties should hesitate before arguing impracticability. Arkansas courts frequently distinguish between impossibility and impracticability in theory, but rarely in practice.

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Mitigation

this doctrine – otherwise, performance could be excused in all unprofitable contracts. Parties raising this defense must show a non-profit purpose that was frustrated; for example, an accounting firm who contracted for cleaning services for a year could raise it to cancel the contract in whole or in part if the firm voluntarily limited access to its office. The firm's performance (payment of money) is still possible, but the purpose of the contract (a clean office) has been frustrated by the pandemic, since the employees are working from home.

If a party tries to cancel performance under the force majeure clause, the other party should offer mitigation options like reduced rent or delayed due dates to prevent total cancellation.

Arkansas courts do not look favorably on attempts to call off performance when an open path to mitigation exists.

The commercial impracticability defense arises when a party's performance becomes impracticable by the occurrence of an event that was assumed not to occur when the contract was made. Unlike under the frustration of purpose defense, performance here must be impossible or impracticable. This defense would thus be most effective for businesses affected by mandatory closures, as discussed above.

Arkansas courts require mitigation before granting excusal, generally requiring diligent – but not extraordinary – efforts.

Courts are most willing to excuse a party's breach when the party has attempted to mitigate the damage. Arkansas courts have refused to grant excusal when the breaching party did not resume performance as quickly as reasonably possible.

Business owners should keep this in mind as they decide on a re-opening date.

For many businesses dealing with COVID-19, curbside delivery and online services are effective mitigation strategies. Parties with these mitigation options may face difficulty invoking their force majeure clauses to terminate agreements in their entirety.

Notice

Most force majeure clauses require notice to the other party, and notice is a good idea even when not required. The party invoking the clause should write a letter to the other party detailing the situation, discussing why continued operation is impossible and why mitigation is unavailable. Courts in Arkansas take the notice requirement seriously.

Scope of Relief

Force majeure clauses differ in scope. For example, many force majeure clauses in leases provide for closure without violating the covenant of continuous operation but do not excuse payment of rent during the time of closure. On the other hand, clauses in leases excusing parties from "any term, condition, or covenant" of the lease would excuse payment of rent as well.

Additionally, as noted herein, Arkansas courts grant excusal only to the extent that the parties mitigate their losses. Courts, therefore, will typically excuse performance only for a reasonable time.

Other Considerations

Courts universally refuse to imply force majeure clauses in contracts. A party without a force majeure clause – or a party whose force majeure clause does not encompass the pandemic – would need to rely on the common law defenses of frustration of purpose or commercial impracticability.

Finally, the parties may try to work out an agreement on their own. If the force majeure clause is not helpful to a breaching party, and the other party is willing to negotiate, the parties may sign an addendum to the contract. As is typically the case, negotiation may be the best strategy.

About the Authors

Timothy W. Grooms is a Managing Member of Quattlebaum, Grooms & Tull PLLC where his practice focuses on real estate, banking, and commercial lending transactions. tgrooms@QGTLAW.com.

Robbi Riggs Rosenbaum, a Spring 2020 graduate of the Bowen School of Law and a Certified Public Accountant, is joining Quattlebaum, Grooms & Tull PLLC as an Associate where her practice will focus on real estate and commercial transactions. rrosenbaum@QGTLAW.com.

Under the frustration of purpose defense, a party need not fulfill its obligations under the contract if the underlying purpose of the contract can no longer be achieved. Parties generally raise this defense when performance is possible, but enforcing the contract as written would be inequitable because of changed circumstances. Courts will typically not accept "making a profit" as the underlying purpose of a contract under

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How U.S. Banks Can Start Planning to Deliver Crypto Custody Services

by Thomas Trepanier

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t’s official: banks can now earn a new revenue stream, after fresh guidance from the OCC clarifying that all nationally chartered U.S. banks may provide custody services for cryptocurrencies. While receiving a regulatory green light is good news, this raises a very big question for banks: How do we do this?

The OCC guidance provides direction and a higher comfort level for banks curious about the crypto sector. Those interested in moving forward can begin actively investigating exactly how secure methods of digitizing and modernizing traditional banking activities can be implemented.

An Opportunity Emerges Virtual currencies are a complex product—while they serve as a payment mechanism for willing sides of a transaction, they are treated by the IRS as an asset, and their volatility can be high. Crypto holders often store their unique keys confirming their ownership of the currency in a physical format that requires custody to be kept safe.

As a payment platform, crypto represents a challenge to the payment system built and operated by banks. But as an asset, it presents a business opportunity. The OCC’s clarification that U.S. banks can hold a cryptocurrency’s unique cryptographic keys clears the way for them to custody their customers’ digital assets. In fact, this may turn the tables in banks’ favor, as they already have an established presence and loyal customer base, easing their onramp into cryptocurrency.

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Banks that were previously merely intrigued by crypto custody now sense an opportunity. The hard work begins now, as banking management realizes that there are several stages before launching their first virtual vault. They must develop a full understanding of cryptocurrency, blockchain and digital assets, learn how to provide scalable custody services, as well as achieve deep expertise on all the related technology, security, and regulatory issues that come with reliably safeguarding crypto for both institutional and retail customers. It’s a big responsibility, but one that banks should inevitably accept to keep pace with market demands.

A Roadmap for Banks to Become Crypto Custodians The following questions represent a roadmap for banks on their journeys to becoming crypto custodians:

1. Many retail and professional investors are used to having established players from the crypto world, like Coinbase, serve as their custodian, or acting as their own custodians via hardware wallets. How quickly will they warm up to having banks serve as their crypto custodian?

While retail customers are accustomed to having exchanges like Coinbase serve as their custodian, seeing banks participate can only be positive as they could potentially provide a better and more economical service. The best service providers with the best pricing will win.

Smaller markets that embrace crypto could position themselves as an attractive investment venue. Making U.S. banks crypto-compatible can only move the industry forward.

Similarly, institutional customers should find this to be welcome news since banks are a known and trusted commodity.

Adding cryptocurrency custody to their menu of products and solutions would be an added benefit.

tors. In many cases, acquisition may be the only real option for adding crypto custody capabilities, since many potential vendors are also now competitors to the banks that will want to hire them.

2. Blockchain technology has matured over the last decade, with many technology platforms to choose from. How does a bank determine who the best vendors are?

5. How much will adding crypto custody as a business unit cost?

Banks must master many new technologies before they can launch their crypto custody offerings. They will have to either develop in house, hire or acquire infrastructure for systems including hot and cold wallets, trading, transaction monitoring, AML monitoring, cybersecurity, payments and staking.

They must also consider the best network to join. Global instant settlement networks are now emerging that empower banks to settle with maximum transparency, speed and security while making the transfer of digital assets between institutions far more cost-effective. Sophisticated clients will prefer to work with a custodian that ensures their assets can be used to instantly settle across execution platforms and makes the most efficient use of capital for their trading strategies.

3. Which customer base should banks target first for crypto custody?

With its decentralized design, cryptocurrency has the power to solve many of the bottlenecks that have built up in traditional finance. Businesses or entities with the need for secure and efficient international cash transfer at the end of each day, such as a foreign pension fund, are one example of an early candidate for conversion. Wealth management firms actively diversifying their clients’ portfolios are also strong candidates.

4. How will banks attract the right personnel to help manage crypto custody internally?

Here’s where the worlds of traditional finance and crypto collide. Since banks currently have little in-house crypto talent, they will have to start getting aggressive. If they intend to hire people away from crypto firms, that talent will require serious upside to make a move.

The other option is through acquisition. We may soon see significantly increased M&A activity in crypto, as banks bid to buy up blockchain’s established players or intriguing new innova-

The banking industry historically makes conservative risk assessments, and banks must determine not only their risk tolerance but also the readiness of their customers and other regulators. Although the OCC’s opinion carries weight, the more protection banks feel they have from additional regulators, the more they’ll be inclined to spend on crypto custody.

Compared to banks’ current legacy infrastructure, some investments are relatively inexpensive. Many essential custody applications are not latency-sensitive or super high-throughput and run on cloud services with proven security and robust data analytics, such as Snowflake and Amazon Web Services.

The big expense comes from the blockchain implementation and requisite talent.

Joining an instant global settlement network can not only improve performance in key areas but mitigate costs too. The right network provides one-to-many connectivity that vastly streamlines communications with the thousands of digital asset players worldwide, increases security and reduces points of failure.

Boosting the Bottom Line Now that more traditional regulators are signaling approval, we could see cryptocurrency values increase. More regulation helps provide transparency, which many investors have been seeking. The OCC’s opinion provides legitimacy and moves crypto further away from the “Wild West.” This is great timing; investors need new growth areas as the global economy evolves. Smaller markets that embrace crypto could position themselves as an attractive investment venue. Making U.S. banks crypto-compatible can only move the industry forward.

Thomas Trepanier is director of business development for Roxe at Apifiny.

This article was reprinted with permission from the American Bankers Association online website Risk and Compliance section.

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&

GSB Wisonsin Pivots to Deliver Schools Online

t

Adds New Digital Banking School to Meet Industry Needs

o meet demand for banker education while maintaining safety in a pandemic, the Graduate School of Banking as successfully pivoted all its 2020 specialty schools virtual delivery this year.

Six schools will be offered online starting in September, including the Financial Managers School, Bank Technology Management School, Bank Technology Security School, Sales and Marketing School and Human Resource Management School – all programs that have been very popular for years through traditional in-person delivery.

Additionally, to meet the educational needs. around innovation and digital banking, GSB also unveiled the nation’s first Digital Banking School – designed exclusively to help community bankers successfully move into or grow their digital presence.

“We are excited to offer our popular in-person schools virtually for our students. The distance education classes will still incorporate group discussions and networking that will enhance online learning. Students can expect the same quality content and outstanding faculty that they’ve come to expect from GSB’s in-person programs,” said Becky Patterson, vice president, education and professional development.

GSB’s newest offering, starting September 29, is the Digital Banking School which will feature 8 modules that cover the critical elements of developing and executing a successful digital bank – and will be led by a team of knowledgeable instructors including Eric Cook of WSI Digital Marketing, who is the school’s program coordinator.

Cook will be joined by JP Nicols and Jason Henrichs of FinTech Forge and Joe Sullivan of MarketInsights – who are just a few of an impressive faculty. The team of instructors includes a mix of innovation and FinTech consultants and active bankers.

Patrick Sells of Quontic Bank – who was recently named “2020 Digital Banker of the Year” by American Banker – is one of several practitioners who’ll share their real-world experiences of creating highly successful digital banks.

“Early enrollment indicates this will be a very popular program, which isn’t surprising given what we’ve heard from our Banker Advisory Board and others. To consumer expectations, many community bankers are focusing on digital product lines, online engagement, vendor partnerships and more” said Kirby Davidson, president and CEO. “There is a tremendous need for education in this area – and we’re proud to add this terrific school to our lineup of offerings that support community banking.”

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"I believe this is the perfect time for GSB to launch a Digital Banking School. It's exactly what the banking industry needs right now, especially given what's taken place over the past several months as bankers have had to shift their strategies and adapt rapidly to new ways of serving and connecting with their customers digitally. Given the caliber of faculty who are involved and the sessions we have planned, this program will serve as a comprehensive expert's guide in all the various facets of a digital banking strategy. As a GSB graduate and faculty member for several other GSB programs, it's not only exciting for me - but a real honor - to be the section leader for this groundbreaking program," said Eric Cook, digital strategist with WSI and founder/chief mentor at TheLinkedBanker. com Enrollment is limited – and waiting lists are anticipated for some schools – so early applications are strongly encouraged. To enroll in a GSB school, or to register for an online seminar, please visit www. gsb.org and choose your preferred program from the drop-down menu. Applications are now being accepted for all 2020 GSB specialty schools, as well as for an array of online seminars that are available year-round.

Bankers interested in enrolling for the next session of the Graduate School of Banking, which will be held August 1-13, 2021, in Madison, Wisconsin, can begin applying when 2021 enrollment opens in early September. Since the 2020 session was cancelled due to COVID, and all enrolled students were rolled forward to the next session, there is unprecedented demand for the limited seats that remain available – applying early is the best way to secure a seat before the school reaches capacity.

The Graduate School of Banking at the University of Wisconsin, which is sponsored by state banking associations from across the central United States, as well as the University of Wisconsin-Madison, was established in 1945 to provide bankers with an opportunity for advanced study and research in banking, economics and leadership. In addition to its flagship Graduate School of Banking, GSB offers specialty schools for Human Resource, Technology, Information Security, Sales, Marketing and Finance leaders in banking—plus online seminars across all areas of bank management.

For further information call 1-800-755-6440 or email www.gsb.org.

(Above photo) 2019 GSB graduates gathering after commencement for photos and sharing memories.

(Left photo) GSB-Wisconsin graduates receive two credentials – a diploma in bank management and Certificate of Executive Leadership from the Wisconsin School of Business Center for Professional and Executive Development.

(Above photo) 2019 Sales and Marketing School attendees enjoying group discussions; small group interaction and networking will still be a part of the virtual program when it’s held online in Fall 2020.

(Right photo) Eric Cook, Digital Strategist, WSI Digital, is the program coordinator for GSB’s Digital Banking School and also serves on the faculty of the Sales and Marketing School and Graduate School of Banking.

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Op-ed Article

Community Banks Impaired Trying to Serve Military: On-base Favoritism of Credit Unions Harms Service Members

a

s an active-duty overseas military veteran and community banker, I have personally witnessed a troubling trend on U.S. military bases: the shrinking availability of banking options to service members. Locally based community banks are being driven off bases by a quirk in federal law allowing tax-exempt credit unions to operate rent-free while the Defense Department does not extend this same treatment to banks — making it impossible for banks to remain on base.

Fortunately, Congress is considering legislation that would restore needed rent parity between banks and credit unions to preserve access to responsible and regulated financial services for military personnel at a time of significant economic stress.

Banks have operated for decades on military installations at no cost to the Defense Department. In fact, banks provide free services to service members, such as financial counseling, and to the government, such as cash for deployments. However, a 1996 law considers these services in-kind payment for leases and fees for credit unions — but not for banks.

This disparity takes its toll as the cost of leases and utilities rise and banks are forced to make the difficult decision to cut their losses and leave the base. Bases with full-service banks have

By James Smith, President & COO • FMS Bank, Greeley, CO decreased more than 40 percent since 2004. And community banks make up 75 percent of on-base banks, meaning these are local institutions — not global megabanks — exiting military bases. While credit unions have defended the 1996 lease exemption Congress gave them as a big bank issue, the data show this is simply not the case.

In fact, military credit unions are the largest in the country and extending themselves beyond military families. Tax-exempt Navy Federal has expanded rapidly to more than $125 billion in assets, dwarfing community banks. Tax-exempt Pentagon Federal has partnered with Goldman Sachs to provide a nearly $1 billion loan to finance a luxury mixed-use real estate development in the nation’s capital while advertising that “anyone can join.” These institutions contrast sharply with the credit union industry’s founding purpose of serving people of modest means with a common bond, which originally justified credit unions’ other unfair competitive advantage — their tax exemption.

Ultimately, the costs of this military banking exodus are borne by service members and their families. As military banks are squeezed out due to the taxpayer-funded competitive advantages of credit unions, military personnel and their families lose out on the full range of financial services, and the quality and innovation that results from choice and competition.

As a young enlisted soldier without personal transportation, I had no choice but to use the financial services located on base when I was stationed at Fort McClellan in Alabama and at the Robinson Barracks and Airfield Nellingen in Germany. When I wanted to buy a car, the only choice for a loan was the one on-base bank, and I was obliged to agree to whatever terms and conditions they offered out of pure necessity. I was limited to one bank; today, many soldiers are limited to one credit union. The declining availability and diversity of on-base financial services is presenting the same problem to more and more service members.

Service members have also increasingly sought assistance from the predatory lenders often positioned just outside the base gates that offer high-interest, short-term loans. In fact, active-duty military personnel obtain payday, tax-refund, and pawn-shop loans at significantly higher rates than their civilian contemporaries.

(Photo) An airman inserts a bank card into an ATM at Eielson Air Force Base, Alaska. (Air Force)

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Leveling the competitive playing field with military banks and ending the growing credit union monopoly on military installations will strengthen the financial position of military personnel while limiting the debt traps, high interest rates, and financial emergencies that frequently plague service members. Little wonder that last year the Military Coalition — a consortium of 34 military and veteran service organizations representing more than 5.5 million service members and their families — endorsed the change.

Fortunately for military personnel, Congress will debate legislation again this year to end the disparate treatment of banks and credit unions on military bases. An amendment to the 2021 National Defense Authorization Act would require the Defense Department to treat credit unions and banks the same with respect to rent. In other words, if the department waives or charges rent for credit unions, it would be required to do the same for banks.

This equitable treatment language is included in the Senate version of the defense spending bill, but not the House companion. To end the banking exodus from military bases and restore financial services access and competition for service members on base, Congress should fully pass this measure and send it to the president to be signed into law. During this time of unprecedented economic stress, financial favoritism should not put service members at a disadvantage.

Editor’s note: This is an Op-Ed and as such, the opinions expressed are those of the author.

2020 Salary and Benefits Survey Purchase the 2020 Arkansas Bankers Association (ABA) Salary and Benefits Survey. The Johanson Group compiled the final results – which includes comprehensive salary and benefit data reported by asset size, geographic region, and major cities – in an easy to read format.

If your bank participated in the 2020 survey, a discount code was e-mailed to the bank. If you need a copy of that code, please email Carla Brinkley with the Arkansas Bankers Association at carla.brinkley@arkbankers.org.

Forbes Magazine Recognizes Four Arkansas Banks Among the World’s Best

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he Arkansas Bankers Association congratulates four Arkansas banks for making the Forbes magazine’s “World’s Best Banks” list. The publication released its second-annual list of the “World’s Best Banks” in June 2020.

In total, 23 countries were represented on the list with 450 banks making the cut. Four Arkansas banks featured in the top 25 list include Arvest Bank, headquartered in Lowell; Centennial Bank, headquartered in Conway; BankOZK headquartered in Little Rock and Simmons Bank, headquartered in Pine Bluff.

Arvest Bank was the top-rated Arkansas bank of those in the United States, with a ranking of number seven among the country’s banks and this marks the second consecutive year Arvest has received the honor, Bank OZK was ranked number 16, Simmons Bank was ranked number 19 and Centennial Bank was ranked at number 22.

Lorrie Trogden, President/CEO of the Arkansas Bankers Association said, “What a distinguished spotlight for the state of Arkansas to have four banks in the top 25 of the Forbes list. I am incredibly proud of the investment all Arkansas banks give to support the economic growth, health and vitality of their communities. Our banks have over 26,000 dedicated employees who are passionate about serving the needs of individual and business customers throughout the state, it’s this commitment to Arkansas that gives the state some of the top banks in the world.”

Candace Franks, the Arkansas State Bank Commissioner, stated, “As Arkansas Bank Commissioner, I salute our four Arkansas banks named in the top 25 of Forbes Best Banks 2020. This recognition is for outstanding customer service and satisfaction which are traits we have in common throughout our Arkansas banking industry. Congratulations and I am so proud of our Arkansas banks! “ Alisha Curtis, Chief Communications and Legislative Director of the Arkansas Department of Commerce, commented, “Arkansas has a great reputation for having among the most influential banks that conduct business at a very high level all over the world.”

Secretary of Commerce Mike Preston went on to say, “Arkansas’ economic environment is conducive to facilitating growth in the financial services sector. Our regulatory burden is not excessive and with our accommodating economic infrastructure, it makes Arkansas a great place from which to do business. I congratulate these four banks for being among the world’s best.”

According to Forbes, the rankings were based on “general satisfaction and key attributes like trust, fees, digital services and financial advice.” Forbes partnered with market research firm Statista to conduct surveys and more than 40,000 surveys were conducted with banking customers from around the world.

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ARKANSAS MILESTONE BANKERS HONORED Twenty-seven longtime Arkansas bankers and one Arkansas bank will be recognized with the BKD Milestones in Banking Awards at the 130th Annual Arkansas Bankers Association Virtual Convention. Because the convention is virtual this year, the awards recipients will receive their awards via mail and will be recognized online on the ABA's website and will be recognized during Convention as well.

This marks the sixth year for the Milestones in Banking awards, sponsored by BKD, LLP. To be eligible for the awards, bankers must have served 40+ or 50+ years in banking, and be actively employed by an Arkansas bank. To be a milestone bank the institution must be observing a 75, 80, 90, or 100th anniversary.

— 50 Year Bankers — SANDRA CARRIER

Teller Farmers & Merchants Bank

Sandra Carrier started her banking career as a bookkeeper at First National Bank of Marianna in February of 1970. In 1980, she moved to Benton and worked for Union Bank of Benton as a bookkeeper/ teller. Then in 1981, she came back to First National Bank of Marianna as a bookkeeper and later became a teller/branch manager. In 2009, First National Bank of Marianna became Farmers and Merchants Bank where Sandra continues to work as a teller. She says being a teller is her first love, well, other than her seven-year-old grandson, Colt Thomas with whom she loves to spend her time. Sandra’s son, Lance, is also in banking and lives in Jonesboro.

BILL PUDDEPHATT

Little Rock Market President First Service Bank

Bill Puddephatt started his career in banking in the 1970’s and has never stopped running since. He has worked for several major banks throughout his career in many different roles. Most recently, he was executive vice president for BankOZK, president of the Little Rock market for the First National Bank and six years ago, he became Little Rock market president for First Service Bank. Bill graduated from Hendrix College majoring in Economics and Business Administration and has a diploma with high honors in real estate finance with Ohio State University. Bill has been the chairman of several volunteering committees over the years, such as Arkansas Children's Hospital, Boy Scouts of America, and Christ Lutheran Church.

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HUGH ALLEN QUIMBY

EVP, Trust Officer and Information Security Officer First State Bank of Warren

In 1970, Hugh Allen Quimby went to work for First State Bank of Warren as an officer trainee, worked as a bookkeeper, teller, note teller, branch manager, loan secretary, and secretary to the president.

In 1974, Quimby joined Citizens National Bank in Jacksonville as vice president in charge of bank operations and a loan officer. While there, he was in charge of automating the bank and putting all applications on computer.

In 1976, he returned to the First State Bank of Warren as vice president in charge of marketing, advertising, public relations and personnel. In 1977, he was placed in charge of operations and made loans. A year later, Quimby was promoted to senior vice president.

In 1981, he was promoted to executive vice president in charge of operations and loan officer and at present, is the executive vice president, personnel officer, trust officer, and in charge of information technology.

BEVERLY WILLIAMS

Hedging Trader Arvest Bank

Beverly Williams began her banking career as a teller at the First National Bank & Trust Company (which later became Arvest Bank) in Rogers, AR, in July 1970.

From 1972 to 1984, she worked in several roles within the loan department: loan teller, loan assistant/processor, and supervisor. Since 1985, Beverly has worked in the Bank Portfolio Management Department and currently serves as a hedging trader.

— 40 Year Bankers — FREDDIE BLACK

Chief Business Development Officer Simmons Bank

As Simmons Bank’s chief business development officer, Freddie Black drives all aspects of Simmons’ business development strategy, including marketing, product development, and sales analytics functions. Freddie previously served as Simmons’ regional chairman for Arkansas and southeast Missouri, overseeing all banking within his region.

Freddie’s Simmons career began in 1984 when Simmons completed its acquisition of First State Bank and Trust in Lake Village, Arkansas. It was evident even then that Freddie believed in “going the duration.”

Freddie’s advice to aspiring bankers is, “Work hard and treat people with respect” – values he applies even beyond the workplace. He is a former board member for the University of Arkansas Foundation, the Arkansas Game and Fish Commission, and The Rockefeller Foundation. He currently serves on the Winthrop Rockefeller Institute board and was named the governor-appointed chairperson for the Arkansas Beverage Control Commission in 2018.

Freddie holds a bachelor’s and master’s degree from the University of Arkansas and graduated from Louisiana State University’s School of Banking in 1983. A committed family man, Freddie spends his free time with his wife, children and grandchildren, and working on his family farm in Lake Village, Arkansas.

BOB BURNS

Chairman of the Board Farmers Bank & Trust In 1980, Dr. Bob L. Burns began his banking career as a compliance officer at Farmers Bank & Trust. In 1983, he was elected president and CEO and has guided the bank from a $30 million institution in Magnolia, Arkansas, to over $1.6 billion in total assets with over 22 locations in 14 communities throughout southwest Arkansas and east Texas.

Burns, a retired colonel with the army, has a meritorious record of military service and has assumed many active roles in community and statewide organizations. His hobbies include duck, deer and pheasant hunting along with fly-fishing. He also has a special skill set as an aircraft pilot.

Thank you, Bob L. Burns for your many years of service to our country, community and to Farmers Bank & Trust!

GHARON CAMP

Commercial Document Processing Specialist • Simmons Bank

Gharon Camp started at Simmons Bank on August 25, 1980. Over the last 40 years, her experience has spanned from mobile home insurance and student loans to Community Reinvestment Act and Home Mortgage Disclosure Actrelated services, along with processing.

Gharon credits her career success to hard work and a commitment to do the best she can each day, qualities that also come through in her hobbies, which include reading and church involvement.

JIM CARGILL

President and CEO • Arvest Bank

Jim Cargill is President & CEO of Arvest Bank in Little Rock. Cargill is a fourthgeneration banker; he joined Arvest in 1985, and he has been located in central Arkansas since 1999. Throughout Jim’s career, he has helped develop Arvest’s marketing initiatives, and worked to further Arvest’s ability to identify products and services that are of the greatest benefit to customers.

He attended the University of Arkansas at Fayetteville, where he majored in finance and banking. He also is a graduate of the American Bankers Association Graduate School of Commercial Lending and of the Professional Masters of Banking Program at the Graduate School of Banking, Louisiana State University.

PHYLLIS COLEMAN

Teller • Farmers & Merchants Bank

Phyllis Coleman began her banking career in 1980, at First National Bank in Russellville, Arkansas (later became Regions Bank). She was in the bookkeeping department and took a teller position. She moved back to Jonesboro in 1998 and worked as a teller and in customer service (opening new accounts) for Regions.

She then started working for Integrity First Bank in 2017 as a teller, which later became Farmers and Merchants Bank. Phyllis says her favorite job in banking is teller work. She added, “I love helping customers and meeting different people.”

Phyllis has been married to her husband Jimmy for 48 years.

They have two sons and seven grandkids. She attends North Main Baptist Church and is over the children’s department.

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CANDACE FRANKS

Bank Commissioner Arkansas State Bank Department Candace Franks is the 21st Commissioner of the Arkansas State Bank Department and began serving in that role in 2007.

She is the first female and the first professional bank regulator appointed to her position. She has served the Bank Department since 1980 as legal counsel, deputy commissioner, and commissioner.

DEB FULLER

Branch Administrator Arvest Bank Deb Fuller is a vice president and branch administrator for Arvest Bank Fort Smith and the eastern Oklahoma region that supports branches in eastern Oklahoma and western Arkansas. She has been with Arvest Bank for two years. Previously, Deb worked for Bear State Bank as the regional retail manager.

Deb has 40 years of banking experience working in various capacities. She attended Waldron High School, the University of Central Arkansas, and Rich Mountain College. Deb attends Boles FreeWill Baptist Church. She has one son, Caden, who is currently a junior at Waldron High School.

SHERI PARSON HABERMEHL

Integrated Account Services Supervisor Arvest Bank

A 1978 graduate of Bentonville High School, Sheri Habermehl began working after graduating high school at the Bank of Bentonville until October 2001. She worked in accounting and deposit services jobs. For five years, she worked as a bookkeeping clerk. She also worked in various other jobs as well – a teller, proof operator, documentation clerk, and loan processor. She eventually became a mortgage loan assistant at the main bank and Bella Vista Town Center branch. She was a consumer/commercial loan assistant and then for two years was the loan assistant supervisor. For six years, Sheri worked as the loan operations officer/AVP. From October 2001 until April 2006, she was the imaging manager and then in 2006 until present, she became the integrated account services supervisor for exceptions such as return and adjustments. Congratulations, Sheri, on over 40 years of great work!

TERRY M. HENDRIX

Vice President, Security Specialist lll Arvest Bank

RAMONA GARGANEOUS

Terry Hendrix’s 40 years of service in the banking industry has been at the same location in Fayetteville, Arkansas. The bank’s name has changed from McIlroy Bank & Trust to Arvest Bank.

On July 28, 1980, Ramona Garganeous began her banking career in the check payment department at Simmons Bank. Her passion for her work led her to earn three banking diplomas from the American Institute of Banking, now part of the American Bankers Association.

He started working at the bank the summer of 1980, before his senior year in high school. After graduating from Fayetteville High School, Terry worked full time at the bank and took classes at the University of Arkansas, graduating in 1989 with a degree in finance and real estate. In 1990, he added vice president/security officer to his vault manager duties. Over the next 15 years, Terry excelled in the areas of vault management and security and shared his knowledge as an instructor of ABA security classes.

Branch Operations Specialist lll Simmons Bank

Ramona credits her long career to being part of a bank that feels like a family. In addition to her enjoyment for work, Ramona also finds meaning in giving back to her community during her free time. She volunteers for organizations like the Great American Cleanup, the Salvation Army, and Neighbor to Neighbor. Thank you, Ramona, for your many years of wonderful service!

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For the last 20 years, he has been in a bank support role of marketing and community involvement. Terry has a unique skillset and passion and works as a representative of Arvest and participates in community festivals and parades, providing floats to encourage employee interaction and involvement in the communities of the three states that Arvest represents.

MARK HIRYAK

Vice President/ Senior Core Processing Engineer Farmers & Merchants Bank Mark Hiryak started at Farmers and Merchants Bank in November 1979, as a computer operator in the Stuttgart office. In January 1991, he was promoted to data processing officer. In 1998, he became vice president of the IT department and in 2011, was promoted to senior VP of information technolgy. In 2017, Mark took on a new role as the senior core processing engineer.

Mark enjoys taking trips with his wife Lisa, and enjoys being with his two daughters.

LUANN HOWARD

Relationships Manager Bank of America

In December of 1980, Luann Howard began her banking career as a teller at Worthen Bank. She was soon promoted to senior teller then customer service, which included sales, loans, and loan processing.

Later, she was moved to assistant manager and then became manager. She was there through three name changes — NationsBank, Boatman’s, and now Bank of America. She serves as relationship manager and business owner specialist at the Geyer Springs Financial Center. Luann credits her success in banking to the great managers and wonderful customers she has served over the years.

Luann loves traveling with her husband Gary, and loves her dogs, Alex and Sophie.

REGINA LAKE

Manager - Bookkeeping Department Merchants & Planters Bank Regina Lake has not only been in banking for 40 years, she’s been with Merchants and Planters Bank for 40 plus years! She started when she was a young mother, helping to clean the bank after hours for additional income. She soon realized that she had found a place that she loved and set out to make a career there. She’s seen many changes, helped thousands of customers, and – as the longest tenured employee – is the matriarch of the M&P family.

CAROLYN MCGRAW

Senior Vice President/Trust Officer Farmers & Merchants Bank Carolyn McGraw began her career at Farmers and Merchants Bank in 1980 as a customer service check filer. She advanced her career as trust secretary in 1989. She was promoted to assistant vice president/trust officer in 2004. She was later promoted to vice president in 2009, and in January 2011, she became senior vice president/trust officer. Carolyn is a 2013 graduate of the School of Banking at the Cox School of Business at SMU in Dallas.

She enjoys spending time with her husband Martin, her two daughters, and their families which includes three grandchildren.

BILL MILUM

Senior Examiner Arkansas State Bank Department Bill Milum has served the bank department and the banking industry for over 40 years. He has witnessed first-hand the evolution of the industry from both the bank and the regulatory perspective.

JANET MOORE

Chief Operations Officer Stone Bank Janet Moore joined Stone Bank as Chief Operations Officer in January of 2020.

Prior to that, she was chief operations officer and executive vice president with Citizens Bank in Batesville. Moore has also held positions with Iberiabank and Pulaski Bank in Little Rock. She is a graduate of the University of Tennessee with a Bachelor of Science Degree in Accounting and the Southwest Graduate School of Banking.

Congratulations for your 40 years of service!

CYNTHIA NIXON

Executive Assistant to the Commissioner Arkansas State Bank Department Cynthia Nixon began her banking career at the Arkansas State Bank Department in 1978 and has served and supervised the administrative support area for over 40 years. Cynthia has witnessed many changes in the Arkansas banking industry during her tenure and has been such an asset to the bank department.

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DIANNA PRESTON

Loan Assistant Farmers & Merchants Bank

DiAnna Preston started working at First National Bank of Fayetteville as a check printer in January 1980. She was then promoted to a teller position and later became a customer service bookkeeper. It wasn’t long before DiAnna was promoted to a wire transfer position and finally to a loan assistant position. She started working for the Bank of Fayetteville on March 31, 2003, as a loan assistant and she continues to work in that position. She has gone above and beyond for her customers over the years, whether that be hand typing cashier checks for a customer so they can pay their employees, or getting a loan expedited for a customer so that they could close on the correct closing day. DiAnna also wrote the first loan assistance manual for the Bank of Fayetteville. She says, “I love my job and the favorite part of it is when our organization is able to finance a loan, close on it, and the customer is happy.”

JOYCE RADCLIFF

COO & Board Member RiverBank

In 1973, Joyce Radcliff began her banking career as a teller/bookkeeper at Planters & Stockmen Bank in Pocahontas, Arkansas. Joyce moved to the newly formed IT department when the bank installed its first in-house computer system in 1978.

She became the IT officer and ran the data center for the bank through the 1990’s, surviving several name changes as Planters & Stockmen Bank acquired other banks in northeast Arkansas and started First Community Bank in Jonesboro in the late 1990’s. Joyce left what eventually became Iberia Bank in 2007 and began her career with RiverBank. Joyce has served as COO of RiverBank for 10 years and on the board of directors of RiverBank for seven years. Joyce credits her success in banking to having learned a good work ethic while growing up on a farm and to the opportunities provided her as a result of that hard work. She never watched a clock, just worked until a job was done to the best of her ability. Joyce’s hobbies include traveling and spending time with her two daughters and her five grandchildren. Thank you, Joyce Radcliff, for 40-plus years of banking and for the dedication and experience you have brought to RiverBank.

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ANGELA ROBERTSON

VP/Credit Administration Assistant Manager Eagle Bank & Trust

Angela Robertson began her banking career as a proof operator on September 23, 1978, at the First National Bank of Phillips County in Helena, Arkansas.

Angela was hired by Eagle Bank on November 1, 1999, as a loan assistant, and was later promoted to AVP/Consumer Lending, then to her current position of VP/manager of Credit Administration. Angela worked in the Eagle Bank Little Rock office until moving to the Heber Springs loan operations office on May 1, 2012. Angela will celebrate her 42nd year in banking this year, with 21 years of her career at Eagle Bank and Trust.

TOMMIE SHACKELFORD

Chief Accounting Officer Partners Bank

Tommie Shackelford began his banking career on September 1, 1973, in Marvell, Arkansas, at the Bank of Marvell. Back then, there was no such thing as direct deposit, electronic posting, or various interest rates from bank to bank.

Tommie started out on the teller line, then operated a proof machine. The bank was bought out by Helena National Bank in 1991. Soon after that, he was offered the opportunity to come to his present position in accounting.

In 2019, Helena National Bank rebranded itself and became Partners Bank where Tommie serves as the chief accounting officer. He says that he has learned a lot from a few mentors who have given him many pleasant experiences and memories.

STANHOPE WILKINSON

NANCY ZINK

Chief Executive Officer Farmers Bank

Business Development Representative Arvest Bank

Stanhope Wilkinson has been the chief executive officer at Farmers Bank since 1994, but his employment at the bank dates back to his boyhood. Stanhope started in the maintenance department, worked into a teller position, then was promoted to bookkeeper while working during the summers in high school. Through the years he has worked his way up the corporate ladder, serving as vice president, president and now CEO. He uses his vast experience to lead business development, marketing, public relations and collections for Farmers Bank.

Nancy Zink began her banking career in 1979 at what is now Regions Bank.

There, she managed a customer service staff of ten for Little Rock area, and held roles of database marketing analyst and treasury management advisor. Nancy earned her Certified Treasury Professional Designation in 1999 and continues to hold the designation.

Stanhope graduated from Greenwood High School in 1976, and studied at the University of Arkansas in Fayetteville where he attained a Bachelor of Science in Business Administration in 1980. Two days after graduation his full time employment began at Farmers Bank. He went on to sharpen his banking skills at the Southwestern Graduate School of Banking at Southern Methodist University, graduating in 1984.

As one of the first associates in the central Arkansas area, Nancy has made immeasurable contributions to the success of Arvest Bank through her roles in treasury management and business development. Nancy has a solid reputation for building long-term trust-based relationships with clients and has been recognized multiple times as a top sales performer and Arvest Sales and Service Award Winner.

80 Year Milestone Bank PARTNERS BANK

Helena, Arkansas

Partners Bank, formerly Helena National Bank, was chartered in Helena, Arkansas, on April 1, 1940, by Helena Bancshares, Inc. In 2019, Partners became a state-chartered bank and completely rebranded itself.

Partners’ mission is to utilize their resources to build steadfast partnerships that support and enrich the lives and communities they serve and to create value for those around themselves at every opportunity.

Privately owned, this community bank currently has six branch locations in Helena-West Helena, Marvell, Wynne, and Marion. Partners expects to go beyond its current east Arkansas footprint, bringing in new markets including central and northwest Arkansas, and ultimately northeast Arkansas, and parts of Tennessee and Mississippi.

Partners believes in giving back! “Partners for a Cause” allows employees the opportunity to donate to local non-profits and charities in exchange for a jean day at work each month. Some recipients of the initiative include St. Judes Hospital, Arkansas Autism Awareness, Make-A-Wish, Alzheimers Arkansas, Second Chance Domestic Abuse Shelter, and Center the Lifelong Learning, PCCUA Workshop in the Arts, and a UMC Soup Kitchen.

Partners also hosts “Mix and Mingles” at various businesses or community points of interest. Partners supports state-wide and local events including the King Biscuit Blues Festival in Helena, Alzheimers Arkansas’ Champion of the Year in Little Rock, Make-A-Wish efforts in Marion and Jonesboro, and many school fundraisers and sports programs, as well as other youth, community, and mission based projects.

They truly strive to demonstrate their vision: Creating Opportunities Through Personal Connections. Partners Bank has a rich history of service and a strong dedication to their bank family, their customers and to their shareholders.

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Member News Anstaff Bank Named Industry Top Loan Producer by Independent Banker Magazine Independent Banker, the award-winning magazine of the Independent Community Bankers of America (ICBA) and the number-one source for community banking news, recognized Anstaff Bank, Green Forest, AR as an ICBA top lender in its July issue. Anstaff Bank’s recognition is based on the strength of its competitive banking services and operational efficiencies throughout 2019.

“Through innovation, resourcefulness and an unwavering commitment to their customers and communities, these top lenders are creating a culture of success,” ICBA President and CEO Rebeca Romero Rainey said. “ICBA is proud to recognize Anstaff Bank and its staff for their outstanding efforts and wish them continued prosperity.”

The “ICBA’s Top Lenders 2020” feature reveals the secret to these community banks’ success as agricultural, commercial, and consumer and mortgage lenders. It showcases their commitment, ingenuity, and skill in adapting to market dynamics and evolving customer needs. The annual list is based on the strength of competitive banking services and operational efficiencies using FDIC data for 2019. Scores were determined by combining the average of the bank’s percentile rank for lending concentration and for loan growth over the past year in each lending category and asset size and adjusted for loan charge-offs at certain percentile thresholds.

First Community Banks Tops Forbes' Best-In-State Banks for 2020 First Community Bank has been chosen as the top bank among four other financial institutions on Arkansas’ best banks by Forbes for its 2020 Best-In-State Banks and Credit Unions list (for the Forbes' article on the "World's Best Banks" list see page 37). This prestigious award is presented by Forbes and Statista Inc., the world-leading statistics portal and industry-ranking provider.

"The distinction by Forbes as Best-In-State Bank is a tremendous honor," said Dale Cole, chairman & CEO of First Community Bank. "First Community Bank works hard every day to serve our communities, and this recognition is a testament to the dedication of all our employees."

Forbes’ Best-In-State Banks and Credit Unions 2020 list is comprised of the top banks and credit unions based on the results of independent surveys involving approximately 25,000 U.S. consumers who were asked to rate the financial institutions at which they have or have had checking accounts. Participants made recommendations regarding overall satisfaction; they also assessed banks in the following areas: trust, terms and conditions, branch services, digital services, and financial advice.

Arkansas Bankers Association Partners with Celero Commerce The ABA is proud to have established a partnership with Celero Commerce as one of their newest Endorsed Vendors. From ABA President/CEO, Lorrie Trogden, “We are pleased to have Celero Commerce join the ABA as our Endorsed payments vendor. In this ever-changing financial climate, it is more important than ever to offer Celero’s products and services to our Arkansas banks. With contactless merchant solutions, custom-tailored programs to fit each Financial Institution’s needs, marketing support, exceptional customer service, and more, we are thrilled to bring Celero’s options to our financial community.”

“As the exclusive payments Endorsed Partner, with its extra commitments, for the ABA it is a statement of intent for our organization,” said Jim Harris, Senior Vice President of Strategic Partnerships at Celero. “The ABA is one of the truly outstanding banking associations with a long history of advocating for their member banks. They are the organization of choice for community banks in the state of Arkansas, and we appreciate the opportunity to work together to help provide thought

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leadership and innovative solutions to make their member banks even more successful.”

Celero Commerce offers payment processing services, business management software, and data intelligence to small and medium-sized businesses, in one holistic platform. Celero empowers business owners and executives to focus on driving growth and profitability. Founded in 2018, Celero Commerce is based in Nashville, TN.

Member News Arvest Mortgage Entities Receive Fannie Mae Honor

First Community Bank Launches New Mobile Mortgage App

Both Arvest Bank’s mortgage division and Arvest Central Mortgage Company, a bank subsidiary, have been recognized with the Fannie Mae Servicer Total Achievement and Rewards™ (STAR™) Performer designation for 2019.

As part of an ongoing effort to provide additional conveniences to customers, First Community Bank is proud to announce the launch of its new mobile mortgage app. The app, MyFCB Mobile Mortgage, is a tool that will simplify the home buying and lending process.

The STAR Program is a performance management and recognition program based on a consistently applied framework to clearly define industry standards and leading practices.

Servicers are measured on the basis of their performance managing four key metrics: investor reporting, general servicing, solution delivery and timeline management. Each servicer’s performance in these metrics is compared against the performance of other Fannie Mae loans with similar credit characteristics.

“We continue to be humbled to receive recognition for serving our mission of people helping people,” said Steven Plaisance, president and CEO of Arvest’s mortgage division and Arvest Central Mortgage Company. “Our mortgage servicing team is truly focused on our customers, and that has never been more evident than now, when they are working hard to assist families during this unprecedented crisis. Mortgage servicers are being tested now more than ever, and our team is committed to flexing and adapting as much as required during this time.”

Chambers Bank Opens in Hot Springs Chambers Bank opened its newest branch in Hot Springs in August. This is Chambers’ first location in the Spa City.

The mortgage app has features to benefit potential homebuyers, current homeowners interested in refinancing, or real estate agents hoping to streamline the homebuying process.

Key features of the app include, but are not limited to: • Comparing different lending scenarios using various loan programs to help determine which product is the best fit for the customer • Calculating the possible savings (or cost) of refinancing a mortgage • Determining if homeownership is an affordable option based on current income and monthly expenses • Scanning required documents into device and uploading them quickly to expedite the loan approval process • Easily accessing contact information for the First Community Bank Mortgage Team and real estate agent • Having the option for the user to tap to eSign the entire mortgage application, request a pre-approval letter, or connect with a loan officer, realtor, or the mortgage team directly.

The calculations provided by the MyFCB Mortgage Mobile App are useful in calculating monthly payments and determining costs associated with new home loan purchases.

In addition to the new Hot Springs branch, Chambers Bank has nearby locations in Hot Springs Village and Amity, with a total network of 28 branches in Arkansas.

“First Community Bank offers the best of both worlds - the convenience of a mobile platform backed by a team of local mortgage specialists who are always just a call away. The mobile app connects consumers with their loan officer eliminating the need to come into the bank, while providing helpful resources for us to take care of our customers,” said Jennifer Scarbrough, senior vice president of secondary mortgage special projects at First Community Bank. "Our app carefully guides customers directly to the information they need, just like our team members would if the customer had visited one of our locations. We believe customers will find the new app convenient and easy to use."

A Grand Opening celebration will be scheduled at a later date.

Due to the pandemic, access to Chambers Bank lobbies is currently restricted, with customers being routed to drive-thru and online banking options.

The MyFCB Mortgage Mobile App is available for download at the Apple App Store and Google Play. For more information about home financing, call 870-612-3440 or visit www.firstcommunity.net.

The new branch will house traditional banking amenities like an ATM, teller services, lending and drive-through banking, but will also feature updated technology and design to provide a concierge banking experience.

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Member News Sterling Bank Announces Plan to Expand into Northwest Arkansas Sterling Bank announced plans to enter the Northwest Arkansas market with a loan production office opening at 1607 North College Avenue in Fayetteville. Headquartered in Poplar Bluff, Missouri, Sterling Bank has two locations in St. Louis, numerous locations throughout Southeast Missouri, a location in the Chicago suburb of St. Charles, Illinois and is set to open its newest location on The Plaza in Kansas City, Missouri this spring. Sterling’s plans for Northwest Arkansas include opening full-service locations in Fayetteville, Bentonville and Rogers.

Arkansas native Johnathon Welch of Fayetteville will oversee the market expansion. Scott E. Spencer, President & CEO, remarked, “Sterling Bank is eager to enter the Northwest Arkansas market and offer customers a high-quality experience in the delivery of our banking products and services. We are excited to welcome Johnathon Welch who brings prior experience as a commissioned bank examiner with the Arkansas State Bank Department. Johnathon will provide valuable leadership in the NWA market.”

“I am proud to be a part of Sterling’s expansion into Arkansas,” added Johnathon Welch, “and I look forward to working with commercial and small business enterprises, as well as families in the area.”

Sterling Bank, with an emphasis on personalized service, offers a full array of consumer and business banking products and services competitive with national banks. Sterling Bank also specializes in lending services for the affordable housing industry. To date, Sterling Bank has financed 391 affordable housing projects in 28 states providing $1,976,228,517 in construction financing. Sterling Bank’s professional staff has established a tradition of state-of-the-art banking expertise in all phases of commercial and community banking and is known for being an outstanding community partner that provides generous support to numerous area causes.

American Bankers Association Honors Citizens Bank for Community Development Efforts Citizens Bank has received additional national recognition from the American Bankers Association (AmBA) for its Community Development efforts in Batesville.

In an article that appeared on its “America’s Banks” website, AmBA identifies Citizens Bank as “A Bank That Kick Starts Change for an Entire Community.”

Citizens Bank was acknowledged for its Impact Loans & Grants Program, and for its role in assisting the Batesville Area Chamber of Commerce with the IMPACT Independence Strategic Community Plan. The Impact loans and grants have been credited for playing a critical role in the success of the revitalization of Historic Main Street Batesville. The Impact Independence program has helped guide increased economic development across Independence County.

“Citizens Bank has made a major difference for an entire community with the Impact Independence County programs,” AmBA said. “The initiative brought together residents and area leaders to identify ways to kick start the local economy and make other quality of life improvements. The success speaks for itself.”

Since it was established in 2016, the bank’s Impact Loans & Grants program has provided more than 50 loans and grants totaling $6.5 million. Loans are being made at very low interest rates to finance renovation and improvement programs.

This latest recognition follows the 2018 Community Commitment Award for excellence in community and economic development, which the American Bankers Association presented to Citizens Bank and the Batesville Area Chamber of Commerce.

AmBA says its America’s Banks campaign “features real stories and fresh data about banks’ efforts to support the people and places they serve. The website highlights the industry’s role in building careers, providing loans to individuals and small businesses and making a difference in their communities through philanthropy, investment, innovation and personal service.”

Data released by AmBA indicates that the 87 banks that are headquartered in Arkansas have 23,378 employees, a total annual payroll of $2 billion, 4.5 million customers, and $3.1 billion in small business loans outstanding.

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Banker News

Moves

First Community Bank Announces Promotions First Community Bank of Batesville, AR, has announced promotions in several departments and branches of the organization’s Little Rock locations, according to Renè Julian, community president in Little Rock.

Tami James has been promoted to VP branch manager & loan support.

Tami has more than 23 years of banking experience. She is responsible for the effective management of branch staff, lending, operations, and profitability of the branch. She also develops new business and expands existing customer relationships while making and servicing a variety of loans and maintaining a high-quality loan portfolio to minimize loss to the bank.

Sonia Mitchell has been promoted to AVP commercial lines supervisor of Community Insurance Professionals. Sonia joined the bank in 2013, and she holds an insurance license, CISR, and CPIA designations. Sonia promotes our insurance agency’s presence across all markets and helps businesses with commercial insurance needs.

First Community Bank welcomes Jackie Bennett as vice president and commercial lender at the Conway location at 1089 Front Street. Bennett comes to First Community Bank with 30 years of banking experience and most recently served as vice president and lender for Bank OZK. Jackie is a graduate of Quitman Public Schools and Arkansas Bankers Association School of lending, as well as other banking schools.

Simmons Announces New Executives Simmons Bank has named John Barber executive vice president and chief credit officer and Jimmy Crocker executive vice president, wealth management. Both executives will be based in Simmons’ River Market building in Little Rock.

John Barber, is the executive vice president and chief credit officer.

Barber, who previously served as executive vice president and senior credit officer for IberiaBank in Texas, has been named executive vice president and chief credit officer for Simmons Bank. He will oversee the bank’s asset quality, directing the commercial lending approval process and ensuring regulatory compliance.

Barber holds both a master’s and bachelor’s degree from the University of Louisiana in Monroe and is an alumnus of the Graduate School of Banking at Louisiana State University.

Barber’s arrival also marks a shift in leadership for Steve Wade, Simmons’ former chief credit officer. Wade will transition to the role of assistant general counsel, leveraging his respective 37 and 20 years of industry and company experience to focus on credit and lending in Simmons’ Office of General Counsel.

Jimmy Crocker, has been named Simmons’ executive vice president, wealth management. In addition to overseeing business strategy for this business area, his responsibilities will include driving sales, fee income, compliance and operations related to the fiduciary function of Simmons.

With more than 27 years of experience, Crocker joins Simmons from IberiaBank, where he most recently served as executive vice president and director of trust after being hired to build the bank’s fiduciary business in 2010. In his new role, he will oversee more than 100 trust associates serving Simmons’ entire seven-state footprint with approximately $6 billion in assets under management.

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Banker News

Moves

Partners Bank Announces Team Expansions Partners Bank headquartered in historic downtown Helena announces the addition of Shannon Stokes Hirons as a VP, Mortgage and Consumer Loan Officer assigned to the Wynne Branch on North Falls Blvd.

Ms. Hirons comes to the team with 18 years in the banking industry and has been a resident of Cross County her whole life. She decided to work for the Bank to offer customers an avenue to pursue dreams of owning, refinancing, or improving a home.

Micah Thompson has been tapped

by Partners to lead its expansion into Northwest Arkansas. Thompson, a native of Newport, Arkansas, has lived and worked in Northwest Arkansas for almost 20 years. He will oversee and lead the Bank’s operations and development in the Northwest Arkansas region as the Regional President and the Bank’s Chief Credit Officer.

Friday, Eldredge & Clark Welcomes New Tax Attorney Friday, Eldredge & Clark has announced the hiring of Madeline O. McElhanon. McElhanon will practice in the Finance & Commercial Transactions Group where she will work primarily on transactions in the banking, healthcare, real estate and technology industries. She will represent corporations and financial institutions on securities and regulatory matters as well as general business and transactional law.

McElhanon, a Little Rock native, recently earned her Master of Laws in Taxation from the University of Florida Levin College of Law. She graduated from the University of Georgia School of Law last year and earned a degree in political science from the University of Arkansas in 2016.

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The Arkansas Banker n Fall 2020

Carver Named Vice President for Stone Bank Jared Carver has been named Vice President of Financial Planning & Analysis for Stone Bank. His focus is the analysis of the bank’s financial reports and forecasting financial performance. He joined the bank as a financial analyst and has worked for Frost Accounting CPA’S. He is a Certified Public Accountant and holds an undergraduate degree in economics and a master’s degree in accounting, both from Hendrix College.

Nick Roach, President & Chief Lending Officer of Stone Bank, announced in June that Tim Mood of Benton, Mississippi, joined the Arkansas bank as Stone Bank’s Business Development Officer in Mississippi working to identify new poultry farm financing opportunities for the bank. Stone Bank is one of the regions leading FSA government-guaranteed poultry lenders.

Mood is a Yazoo County native and resides in Benton, MS. He is a 1982 graduate of Manchester Academy and received both B.S. and MBA degrees from Mississippi State University (1986, 2011) in Agricultural Economics and Master of Business Administration.

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Banker News

Moves

Arvest Bank Announces News Hires and Promotions Arvest Bank has promoted David Norris to mortgage loan manager. In this leadership role, Norris will manage the bank’s mortgage lending teams in Northeast Arkansas, Cabot, North Little Rock, Conway and Little Rock. He most recently was a vice president and mortgage lending supervisor for Arvest in Jonesboro.

During his career of 11 years with the bank, he has held management positions in mortgage lending and worked as an assistant branch manager and deposit counselor.

Mark Morrow has been hired to serve as vice president and commercial loan officer for the bank’s northeast Arkansas market. He has more than 18 years of experience as a commercial and consumer loan officer. He also holds a bachelor’s degree in business administration from Arkansas State University and a graduate degree from the Paul W. Barrett School of Banking.

Josh Neal has been promoted to mortgage loan manager for the bank’s territory in central and south Arkansas. Neal will manage mortgage lending teams in the bank’s Little Rock, Saline county and southwest Arkansas markets. He most recently was a vice president and senior private banker for Arvest. His fifteen years of experience in the financial industry also includes mortgage lending, retail sales management, wealth management and financial advising. Neal holds Series 7 and 66 securities licenses.

Arvest Wealth Management hired Jeff Wicks as client advisor for the bank’s Conway/Morrilton market.

Wicks provides clients with strategic counsel regarding their financial investments to protect and grow their portfolios and ensure their trust plan is in order. He has six years of experience in the financial services industry.

Arvest has also announced the promotion of Tanya James to vice president, branch administrator in central Arkansas. James is one of four branch administrators in Arvest’s four-state footprint. James will oversee branch managers and every aspect of branch operations at every location in west Little Rock, Maumelle, Conway and Morrilton. Additionally, she will assist with business development and community relations in those areas.

Hillis Schild has been promoted to director of communications and community development for central, northeast, and southwest Arkansas.

In her new role, Schild will oversee managers of the marketing and community development mortgage lending departments. She also will maintain the responsibility of developing and managing existing relationships with community organizations that serve predominantly low- to moderate-income individuals, businesses and farms, ensuring the bank meets or exceeds its obligations through the Community Reinvestment Act. Deania Vanhoozer has been promoted to vice president, community and business relationship advisor.

Vanhoozer will develop and manage business relationships with members of the community and business account holders, serving as an advisor to meet customers’ financial business needs. She also will be responsible for developing and maintaining relationships with community organizations and area non-profits.

Selena Barber, Arvest's new marketing specialist, joins Arvest with 19 years of bank marketing experience in Jonesboro and across Arkansas.

She will be responsible for the development and execution of marketing plans including advertising, public relations, events and seminars for the northeast Arkansas region. She also will help coordinate contributions, sponsorships and in-branch promotions for Arvest.

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Relyance Bank Announces Promotions Chuck Morgan, Chairman and CEO of Relyance Bank, is pleased to announce the following promotions: Jennifer Ruhlman was recently promoted to Senior Vice President and Senior Retail Officer, leading corporate retail. Ruhlman joined Relyance Bank in January of this year as Senior Vice President of Retail Banking in the Little Rock market. She has twenty years of customer service and management experience in the banking industry. She was recognized as an AR Business 40 Under 40 honoree in 2018. She is a graduate of the Benton and Bryant Chamber of Commerce’s Leadership Saline County program and she served as president of the Arkansas Bankers Association Emerging Leaders Council.

Citizens Bank & Trust Announces Retirements and Promotions Keith Hefner, President & CEO, Citizens Bank & Trust Company announced his retirement this summer and the appointment of his successor.

Hefner retires from Citizens Bank & Trust Company after a 30-year career with the bank and having served as President and CEO since 2004. He has also served as a member of the board of the Arkansas Bankers Association and on the Advisory Council for the Federal Reserve Bank of St. Louis. Hefner has volunteered, over the years, for many community and civic organizations. He looks forward to continuing his association with the bank as a member of the Bank Board of Directors.

The Board of Citizens Bank & Trust is pleased to announce that P. Brent Taylor will assume the role of President & CEO. He grew up in Crawford County and graduated from the University of Central Arkansas and the University of Arkansas at Little Rock, William H. Bowen School of Law. He is also a graduate of the Graduate School of Banking at the University of Colorado Boulder.

Taylor returned to Crawford County in 2013 to join Citizens Bank & Trust as Vice President working out of the Alma branch.

For the last year, he has served the role of Chief Operating Officer.

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Lauren Sanders was recently promoted to Electronic Banking Retail Officer. She earned a bachelor’s degree in Journalism/Advertising/Public Relations with a minor in Marketing/Logistics from the University of AR at Fayetteville in 2016. She earned her master’s degree in Applied Communication Studies from the UALR while she also worked as a graduate assistant to the Assistant Director of the UALR Communication Skill Center.

Citizens Bank in Batesville Announces Promotions Citizens Bank of Batesville is proud to announce the promotion of Lisa Hendrixson to the position of Senior Vice President and Director of Deposit Operations. Hendrixson has many years of banking experience, including management of deposit operations, loan operations and Treasury Management for several multi-billion dollar regional banks.

Ms. Hendrixson earned an Associate’s Degree in Computer Science, Programming, from the University of Arkansas - Pulaski Technical College. She also is a graduate of the Barret School of Banking in Memphis. As a cancer survivor, she has spent many years volunteering and speaking on behalf of the American Cancer Society.

Amanda Morris is now Vice President and Market Retail Manager for the bank’s Central Arkansas region.

Morris helped direct the opening of the bank’s new Foxcroft financial center in Little Rock, and will play a critical role as Citizens Bank expands its presence in Central Arkansas.

Her experience in the industry includes management of multiple bank branches, helping create and execute successful operational banking strategies, building and maximizing important relationships with major business clients.

13. Publication Title

14. Issue Date for Circulation Data Below

The Arkansas Banker

October 2020

15. Extent and Nature of Circulation

Average No. Copies No. Copies of Single Each Issue During Issue Published Preceding 12 Months Nearest to Filing Date

Arkansas Banking News a. Total Number of Copies (Net press run)

Arkansas Bank Department Applications & Approvals An application filed by Partners Bank, Helena, Phillips county, Arkansas, to establish a branch banking facility to be located at the 3632 Johnson Mill Boulevard, #107 Springdale, Washington county, Arkansas, has been approved. August 10, 2020.

An application filed by RiverBank, Pocahontas, Randolph county, Arkansas, for the relocation of a main banking facility from 1700 Old County Road, Pocahontas, Randolph county, Arkansas, to 203 West Broadway, Pocahontas, Randolph county, Arkansas, has been approved. August 10, 2020.

An application filed by First Community Bank, Batesville, Independence county, Arkansas, to establish a branch banking facility to be located at 17820 Chenal Parkway, Little Rock, Pulaski county, Arkansas, has been approved. August 18, 2020.

An application filed by Encore Bank, Little Rock, Pulaski county, Arkansas, to relocate its main branch bank facility from 12224 Chenal Parkway, Little Rock, Pulaski county, Arkansas to 1801 Rahling Road, Suite 100, Little Rock, Pulaski county, Arkansas has been approved. August 19, 2020.

1. Publication Title

Statement of Ownership, Management, and Circulation (All Periodicals Publications Except Requester Publications)

The Arkansas Banker 4. Issue Frequency

Quarterly

2. Publication Number

0 0 0 3

_

(1) Mailed Outside-County Paid Subscriptions Stated on PS Form 3541 (Include paid distribution above nominal rate, advertiser’s proof copies, and exchange copies) b. Paid Circulation (By Mail and Outside the Mail)

6. Annual Subscription Price

$40

4

7. Complete Mailing Address of Known Office of Publication (Not printer) (Street, city, county, state, and

Contact Person

ZIP+4 ®)

1220 West Third Street, Little Rock, AR 72201-1904

Michael Spigner

Telephone (Include area code)

501-978-3603

8. Complete Mailing Address of Headquarters or General Business Office of Publisher (Not printer)

1220 West Third Street, Little Rock, AR 72201-1904

95

91

(3)

Paid Distribution Outside the Mails Including Sales Through Dealers and Carriers, Street Vendors, Counter Sales, and Other Paid Distribution Outside USPS®

0

0

(4)

Paid Distribution by Other Classes of Mail Through the USPS (e.g., First-Class Mail®)

0

0

482

467

43

44

c. Total Paid Distribution [Sum of 15b (1), (2), (3), and (4)] d. Free or (1) Free or Nominal Rate Outside-County Copies included on PS Form 3541 Nominal Rate Distribution (2) Free or Nominal Rate In-County Copies Included on PS Form 3541 (By Mail and Free or Nominal Rate Copies Mailed at Other Classes Through the USPS Outside (3) (e.g., First-Class Mail) the Mail)

3

3

0

0

57

48

e. Total Free or Nominal Rate Distribution (Sum of 15d (1), (2), (3) and (4))

103

95

f. Total Distribution (Sum of 15c and 15e)

585

562

80

89

h. Total (Sum of 15f and g)

665

651

i. Percent Paid (15c divided by 15f times 100)

82%

83%

(4)

Free or Nominal Rate Distribution Outside the Mail (Carriers or other means)

g. Copies not Distributed (See Instructions to Publishers #4 (page #3))

* If you are claiming electronic copies, go to line 16 on page 3. If you are not claiming electronic copies, skip to line 17 on page 3.

PS Form 3526, July 2014 (Page 2 of 4)

Statement of Ownership, Management, and Circulation (All Periodicals Publications Except Requester Publications) 16. Electronic Copy Circulation

Average No. Copies Each Issue During Preceding 12 Months

No. Copies of Single Issue Published Nearest to Filing Date

0

0

b. Total Paid Print Copies (Line 15c) + Paid Electronic Copies (Line 16a)

482

467

c. Total Print Distribution (Line 15f) + Paid Electronic Copies (Line 16a)

585

562

d. Percent Paid (Both Print & Electronic Copies) (16b divided by 16c Í 100)

82%

83%

a. Paid Electronic Copies

I certify that 50% of all my distributed copies (electronic and print) are paid above a nominal price.

9. Full Names and Complete Mailing Addresses of Publisher, Editor, and Managing Editor (Do not leave blank) Publisher (Name and complete mailing address)

The Arkansas Bankers Association 1220 West Third Street, Little Rock, AR 72201-1904

17. Publication of Statement of Ownership If the publication is a general publication, publication of this statement is required. Will be printed

Publication not required.

September 2020 in the ________________________ issue of this publication.

Editor (Name and complete mailing address)

18. Signature and Title of Editor, Publisher, Business Manager, or Owner

Michael Spigner 1220 West Third Street, Little Rock, AR 72201-1904

Date

Director of Communications

Managing Editor (Name and complete mailing address)

Michael Spigner 1220 West Third Street, Little Rock, AR 72201-1904 10. Owner (Do not leave blank. If the publication is owned by a corporation, give the name and address of the corporation immediately followed by the names and addresses of all stockholders owning or holding 1 percent or more of the total amount of stock. If not owned by a corporation, give the names and addresses of the individual owners. If owned by a partnership or other unincorporated firm, give its name and address as well as those of each individual owner. If the publication is published by a nonprofit organization, give its name and address.)

Full Name Complete Mailing Address

The Arkansas Bankers Association

376

Mailed In-County Paid Subscriptions Stated on PS Form 3541 (Include paid distribution above nominal rate, advertiser’s proof copies, and exchange copies)

9-1-2020

5. Number of Issues Published Annually

645

387

(2)

3. Filing Date

1 2 6 0

659

9-1-2020

I certify that all information furnished on this form is true and complete. I understand that anyone who furnishes false or misleading information on this form or who omits material or information requested on the form may be subject to criminal sanctions (including fines and imprisonment) and/or civil sanctions (including civil penalties).

1220 West Third Street, Little Rock, AR 72201-1904

11. Known Bondholders, Mortgagees, and Other Security Holders Owning or Holding 1 Percent or More of Total Amount of Bonds, Mortgages, or None Other Securities. If none, check box Full Name

Complete Mailing Address

12. Tax Status (For completion by nonprofit organizations authorized to mail at nonprofit rates) (Check one) The purpose, function, and nonprofit status of this organization and the exempt status for federal income tax purposes: Has Not Changed During Preceding 12 Months Has Changed During Preceding 12 Months (Publisher must submit explanation of change with this statement) PS Form 3526, July 2014 [Page 1 of 4 (see instructions page 4)] PSN: 7530-01-000-9931

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PS Form 3526, July 2014 (Page 3 of 4)

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