Summer 2019 Georgia Communities First Magazine

GeorgiaCommunitiesFirst Official Publication of the Community Bankers Association of Georgia

INSIDE Gov. Kemp

Signs SB 157 at CBA HQ Successful

Leadership Division

Convention

Summer 2019

Join us: Annual Convention at

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Meet the New

Leadership Division Board educational opportunities

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contents Summer 2019

C B A S TA F F John McNair President & CEO john@cbaofga.com Lori Godfrey Executive Vice President and Chief of Staff, Government and Regulatory Relations lori@cbaofga.com

f e at u r e d

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11

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Kristi Greer Senior Vice President Professional Development kristi@cbaofga.com Lisa McNair Director of Finance lisa@cbaofga.com

2

Georgia’s Community Banks... at the Table!

Tammy Maass Vice President, Accounting tammy@cbaofga.com

3

You are the Backbone of Our Nation’s Financing

Lindsay Greene Vice President Member Services, Marketing and Communications lindsay@cbaofga.com Peake Wilson Vice President Professional Development & Corporate Secretary peake@cbaofga.com Jeremy Thomens Assistant Vice President Marketing and Communications jeremy@cbaofga.com Cassie Conklin Assistant Vice President Digital Strategy and Professional Development Marketing cassie@cbaofga.com Connie Shepard Assistant Vice President Professional Development and Member Engagement connie@cbaofga.com Donna Coutant Professional Development Associate donna@cbaofga.com

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4

General Counsel Corner: Developments in Federal and State Laws Concerning Cannabis Related Businesses

5

Governor Kemp Signs SB 157 at CBA Headquarters

conventions

11 Leadership Division Convention

Highlights

16 51st Annual Convention &

Mini-Trade Show e d u c at i o n

20 Webinars 22 Community Bankers Graduate

from Inaugural Compliance Officer

Boot Camp 23 Cyber Risk Summit member services

29 Scholarship Winners 30 Strategic Partner Spotlight:

Kris St. Martin of CBIZ

15 CBA Leadership Division Elects

New Board

s ta y connected

@CBAofGeorgia

@CBAGeorgia

@company/ cbaofgeorgia

Community Bankers Association of Georgia | 1900 The Exchange, Suite 600, Atlanta, GA 30339 (770) 541-4490 or (800) 648-8215 • Fax (770) 541-4496 | www.cbaofga.com • cba@cbaofga.com Su m m e r 2 0 1 9 | G e org i a Co m m un i ti es F i rs t | 1

From the President’s Desk

Georgia’s Community Banks…

At The Table!

My mentor and former boss Mr. Cam Fine used to say, “If you are not at the table, you are ON the table.” Cam, my former ICBA colleagues and I fought tirelessly to make sure community banks always had a seat at the table. When considering the graphics for this quarter’s magazine cover, your CBA team felt it appropriate to feature the picture of Governor Kemp signing the landmark SB157 legislation at CBA headquarters. With the Governor sitting in our office behind a table draped with the CBA logo, it is clear, CBA and Georgia’s community banking industry are at the table!

The significance of Governor Kemp coming to CBA’s office to sign SB157 cannot be overstated. After all, the Governor is extremely busy and has many other duties and responsibilities to attend to daily. Yet, not only did he come to our office, but he also stayed a good while an interacted with the dozens of community bankers and other dignitaries in attendance. He told HIS story about how a community bank helped him get into business. He graciously visited and posed for pictures with all who asked. As noted, none of this was required of him. Not pictured on the cover at the bill signing is the entire Georgia General Assembly. Every legislator who voted for the bill voted YES on SB157. Coming from Washington D.C., unanimous passage of any legislation is something that I am not familiar with. Even though S.2155 garnered bi-partisan support, it did not receive unanimous support. Clearly, this too is an indication of the recognition of Georgia’s community banking industry and our collective seat at the table.

Make no mistake, securing the passage of SB157 was not easy.

Local municipalities have an estimated $22 billion deposited.

While Georgia’s community banks represent almost 98% of the state’s banks, they hold less than 20% of these deposits.

Considering the overall increase in competition for funding, those entities (and their advocates) holding the other 80% were/are not happy with the fact that community banks want to compete for these deposits. They have successfully kept community banks at bay for years - ultimately making Georgia the last state to pass such legislation. Finally, because of this

John McNair President & CEO Community Bankers Association of Georgia

new legislation, Georgia’s community banks are no longer sitting at the kids’ table!

So, where do we go from here? A generational success like SB157 is fantastic for sure; however, there is more work to do.

Community banks make nearly 50% of all small business loans and over 75% of all agriculture loans. Community banks also fund the dream of homeownership and provide basic banking services - all while paying every cent of owed federal, state and local taxes. The Administration and General Assembly have recognized your vital role and, all of us at CBA are most grateful. In coming years, we are hopeful to work with all to secure more successes for community banks and Georgia.

We will keep the CBA tablecloth cleaned, ironed and ready to drape any table at which we sit.

F lo u r i s h

You are the backbone of our nation’s financing “When our customers’ needs take center stage, we identify creative solutions to help them achieve their dreams.”

When I think about how the lending market has changed over the past decade, there is one consistent theme—community banks have been, and continue to be, the backbone of our nation’s financing. Despite regulatory hurdles and increased competition from nonbank providers, community banks thrive in both consumer and commercial lending. In fact, we provide about 60% of small business loans and 80% of agriculture loans, and those numbers continue to climb.

How, with all the hurdles placed in our paths, have we managed this feat? It’s simple—we focus on the customer and the relationship. When their needs take center stage, we identify creative solutions to help them achieve their dreams.

Rebeca Romero Rainey President & CEO Independent Community Bankers of America

These examples capture the diversity and resilience of thinking that fuels community banking, as well as a glimmer of emerging opportunities. There’s so much more that awaits us, and I urge you to look at this issue as an invitation for innovation. Explore how you could apply these concepts within your own institution.

That spirit of invention and intention allows me to see so many possibilities for our future. Community banks will continue to flourish in lending precisely because of who they are at their core: bold leaders that constantly evolve to meet their customers’ needs in new and creative ways.

Where I’ll Be in July I’ll be visiting the Montana Independent Bankers for their annual convention.

In my days as a community banker, I ran across many opportunities to be inspired in loan offerings. For example, we had a customer who built “earthships,” homes that were totally off the energy grid and used recycled materials like tires and beer cans in their construction. That’s certainly a different business model, but we financed the design and construction of these homes anyway. Only a community bank would take on a project like this, but I was proud that we were able to support an innovative client that also had the interests of the environment in mind.

This kind of ingenuity prevails in community banking, and this month’s issue features banks with an inventive mindset. Take the Bank of Glen Ullin in North Dakota. Its loan portfolio is 95% agricultural, fueled by two loan officers who are also farmers.

That deep understanding of the customer led the bank to help its clients create marketing plans that support their business development and growth. Then there’s First Bank in Hamilton, N.J., which is growing its lending business through both strategic acquisitions and targeted product offerings. The bank offers real estate financing to current customers who want to acquire investment property out of state.

Su m m e r 2 0 1 9 | G e org i a Co m m un i ti es F i rs t | 3

Corner GENERAL COUNSEL

legal news and updates for cba members

Have a topic you would like to see covered in “General Counsel Corner?”

Email us at generalcounselcorner @ jamesbatesllp.com

cbahotline

@ jamesbatesllp.com

Michael N. White

Attorney (478) 749-9921

mwhite@jamesbatesllp.com

Corrie E. Hall

Attorney (478) 749-9949

chall@jamesbatesllp.com

Doroteya N. Wozniak

Summer 2019

Can We Bank It? – Developments in Federal and State Laws Concerning Cannabis Related Businesses

By Michael N. White, Corrie E. Hall and Doroteya N. Wozniak

Georgia’s Hope Act was signed into law by Governor Brian Kemp in April 2019, but became effective July 1, 2019.

The Hope Act permits limited purchase, production and distribution of low potency cannabis oil (less than five percent THC by weight) (“Low THC Oil”) in Georgia and establishes the Georgia Access to Medical Cannabis Commission (the “Commission”) to regulate the same. The Hope Act comes at a time when significant state-led changes to cannabis laws have created an uncomfortable tension between state and federal laws. As a result, financial institutions across the country continuously find themselves trapped in the center of the conflict. This article briefly explores recent developments in the last year with respect to federal and Georgia cannabis-related legislation.

The Hope Act is significant in Georgia for two reasons. Georgia law previously authorized use and possession of Low THC Oil in certain quantities by registered patients for medicinal use, but did not provide for the purchase or distribution of Low THC Oil. Under the Hope Act, patients who are registered with the Georgia Department of Health to possess and use Low THC Oil can safely purchase Low THC Oil in Georgia from licensed dispensaries (for example local pharmacies).

Secondarily, the Hope Act authorizes limited production and distribution of Low THC Oil by the University of Georgia, Fort Valley State University and by six licensed private companies selected by the Commission. Even though the Hope Act resolved some tensions in Georgia with respect to Low THC Oil, the Hope Act and federal law are still in conflict with each other and financial institutions must wrestle with the Bank Secrecy Act (“BSA”) on this issue.

Low THC Oil is manufactured by using marijuana classifications of cannabis. Marijuana is still illegal under the federal Controlled Substances Act (“CSA”). The issue then for Georgia banks is – can we bank these Georgialicensed production companies or dispensaries, when federal law makes marijuana production and distribution illegal? In 2014, the Department of the Treasury’s Financial Crimes Enforcement Network (“FinCen”) issued guidance in this respect leaving the choice of whether or not to bank cannabis-related businesses (“CRBs”) entirely up to the financial institutions but also setting out expectations for financial institution that do decide to bank CRBs. As such, Georgia financial institutions can bank CRBs, but there is a significant business decision with respect to the potential risks and expenses in doing so.

In 2013, the Department of Justice (“DOJ”) issued the “Cole Memo” to ease tensions created between federal and state laws like the Hope Act. The Cole Memo reiterated that marijuana is still a scheduled drug under the CSA and that the sale and distribution of marijuana remains a federal offense. However, the Cole Memo directed DOJ attorneys and federal law enforcement to focus enforcement resources on persons or organizations whose activities interfere with certain federal enforcement priorities listed in the Cole Memo (i.e. sale of marijuana by criminal enterprises, trafficking, violence in cultivation/distribution, growth or use of marijuana on federal property). The Cole Memo did not mean that the federal government turned a blind eye to

financial institutions banking cannabis-related businesses.

Rather, it simply set out priorities for law enforcement on the subject.

In 2014, the DOJ, the Department of the Treasury, and FinCEN published joint guidance in light of widespread state cannabis-related initiatives and the Cole Memo. The guidance created a three-tiered suspicious activity reporting (“SAR”) system for financial institutions who decide to bank CRBs. This guidance also attempted to clarify how financial institutions could service CRBs consistently with their BSA obligations. Notably, the DOJ published a supplement to the Cole Memo contemporaneously with the FinCEN guidance, in which it affirmed that money laundering statutes, unlicensed money remitter statutes and the BSA remain in effect with respect to CRBs and that financial transactions involving proceeds from marijuana could form the basis for prosecution.

However, the due diligence considerations outlined in FinCEN’s guidance, are onerous. For example, FinCEN’s requirement for ongoing monitoring of activity, licensing, and publically available information on any CRB, could turn one community bank officer into a quasi-cannabis regulator or law enforcement official. Such an unnecessarily heavy burden has caused banks to largely refuse to service CRBs. As a result, many CRBs are left to solely deal in cash, creating many other issues, including erroneous tax-reports, frequent instances of robbery and overall violence at CRBs’ establishments.

To further add to the confusion surrounding the banking of CRBs, on January 4, 2018, the Cole Memo was rescinded.

However, on January 31, 2018, FinCEN affirmed that its guidance remained intact and unchanged. Further, in December 2014, Congress passed the Rohrabacher-Farr Amendment, which prohibits the DOJ from spending funds to interfere with implementation of state medical cannabis legislation, like the Hope Act. The Rohrabacher-Farr Amendment is contained in the current omnibus spending bill which is in effect until September 30, 2019.

There is legislation before Congress that would create a regulatory safe-harbor for financial institutions concerning legitimate CRBs. The Secure Enforcement Banking Act (the “SAFE Act”) specifies that funds received from a legitimate CRB (or ancillary businesses) are not unlawful to receive under any federal law. The SAFE Act also calls for regulatory guidance and procedures to be set in place to guide financial institutions in servicing CRBs. This legislation would provide some additional protections for financial institutions.

Until additional federal legislation like the SAFE Act is enacted, Georgia financial institutions have a very narrow regulatory safe harbor to bank licensed marijuana producers and dispensaries providing access to Low THC Oil for medical use. However, the due diligence hurdles to provision of such services are high and expensive and the risks of failing to perform ongoing due diligence are costly. It is advisable to carefully weigh the risks versus the rewards as the HOPE Act takes effect.

Attorney (404) 997-6031

dwozniak@jamesbatesllp.com

PRESENTED BY GEORGIA’S LAW FIRM:

4 | ww w.cbaofga.co m | Summer 2019 OFFICES MACON + ATLANTA

“General Counsel Corner,” a recurring column featuring legal news and information of interest to CBA members, is brought to you by James-Bates-Brannan-Groover-LLP. Visit us at GeorgiasLawFirm.com

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governor kemp signs sb 157 at cba headquarters

Governor Kemp stated, “By supporting small businesses and local entrepreneurs, this legislation is another positive step toward a new day in rural Georgia. I thank the General Assembly and the Community Bankers Association for their hard work on this important issue and their efforts to bring greater prosperity to all corners of our state.”

On Thursday, May 2, 2019, Governor Brian P. Kemp signed SB 157 into law at CBA Headquarters before a group of community bankers from across the state. SB 157 allows community banks, many of which are located in rural Georgia, to accept local government’s funds and allows these banks in turn to reinvest and loan monies back into their own communities and spur economic activity. Increased lending will spur business growth, jobs, and boost statewide economic activity. SB 157 was unanimously passed by the legislature during the 2019 legislative session.

CBA’s President and Chief Executive Officer John McNair stated, “We greatly appreciate Senator John F. Kennedy, Macon, and Representative Dale Washburn, Macon, for guiding the bill through this legislative process. We are also thankful for our partnerships with National Federation of Independent Businesses (NFIB), the Georgia Municipal Association (GMA), and the Association of County Commissioners (ACCG) in making this bill a possibility.

SB 157 will change people’s lives, and all of us at CBA are proud, honored and humbled to have had the opportunity to impact Georgia’s community banking industry in this most positive manner!”

The ceremony began with remarks by CBA Chairman Tim Jones, Citizens Community Bank, Valdosta, Sen. John F. Kennedy, John McNair and CBA Director of Legislative & Regulatory Affairs Lori Godfrey.

The Governor offered remarks, signed SB 157 and visited with community bankers afterwards in a brief reception. CBA is extremely thankful for all bankers, legislators and advocates who supported the bill during this session. We thank Governor Kemp for spending time with us to celebrate this historic milestone for Georgia’s community banking industry.

Su m m e r 2 0 1 9 | G e org i a Co m m un i ti es F i rs t | 5

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CBA Hosts Banker Regulatory Forum in Conjunction with Governor’s Visit to CBA Excitement was in the air as CBA hosted its 2nd quarter Banker Regulatory Forum on Thursday, May 2, at CBA’s Headquarters. Earlier in the morning, Governor Kemp arrived, spoke to the crowd about the important role community banks play in the economy, and signed SB 157 into law (for more on this bill, click here).

After a brief reception, the Banker Regulatory Forum began. The regulators covered their agencies’ hot topics which allowed for productive discussions among the group; and, general questions were later posed from various sources. Topics discussed included the DBF’s Housekeeping Bill, SB157, prize-linked savings accounts, water craft titling, concentrations, liquidity, net interest margin, credit quality and underwriting trends, stress testing, and, the most covered topic - cyber security.

The bankers’ only roundtable included an ICBA Capital Summit update provided by CBA’s Lori Godfrey. She briefed attendees on topics discussed at the federal level – banking legal marijuana businesses, BSA/AML, beneficial ownership, SARs/CTRs, flood insurance and, most importantly, disaster relief. Additionally, an update on banking-related legal and legislative issues was provided by John Sillay, Associate, James-BatesBrannan-Groover (JBBG). The main topics he covered were understanding insurance policies covering cyber security breaches, legal marijuana banking, and CECL.

CBA’s remaining Banker Regulatory Forums Thursday, August 1 - Safety & Soundness Idle Hour Country Club, Macon Thursday, November 7 - Compliance CBA Headquarters, Atlanta Registration for all 2019 Forums is open – you may learn more and register at https://www. cbaofga.com/banker-regulatory-forum.html.

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georgia community bankers make their voices heard AT

ICBA’S CAPITAL SUMMIT

Special thanks to James-Bates-Brannan-Groover-LLP for sponsoring the Georgia delegation dinner at Morton’s The Steakhouse, and thanks to Federal Home Loan Bank of Atlanta for hosting dinner at Woodward Table.

Georgia community bankers gathered in Washington, D.C. this spring with nearly 1,000 other community bankers and industry advocates from across the nation for the Independent Community Bankers of America (ICBA) annual Capital Summit. CBA of GA’s delegation met with Sen. Perdue’s staff, Sen. Isakson’s staff and 11 Congressmen or their senior aides in an effort to advance regulatory relief. In addition to meeting with their policymakers, community bankers heard remarks from Chairman of the FDIC Jelena McWilliams; Chairman of the Senate Banking, Housing and Urban Affairs Committee Sen. Mike Crapo (R-ID); and Chairwoman of the House Financial Services Committee Maxine Waters (D-CA).

Attendees from CBA’s delegation included George Andrews, President, Unity National Bank, Atlanta; Dan Brannan, Partner, James-Bates-Brannan-Groover, LLP, Macon; Paul Bennett, Chairman/CEO, Pineland Bank, Alma; Clark Hungerford, EVP, Vinings Bank, Smyrna; Caric Martin, SVP, Vinings Bank; Stephen Lewis, Senior Lender, First National Bank of Coffee County, Douglas; Matt Mingenback, Director of Sales, Fitech, Fort Worth, TX; David Moore, Vice President, ICBA, Southeast Regional Office, Atlanta; Derek Williams, President/CEO, Century Bank & Trust, Milledgeville; and John McNair, President/CEO and Lori Godfrey, Executive Vice President and Chief of Staff, Government and Regulatory Relations, both with Community Bankers Association of Georgia, Atlanta.

Community bankers from across the nation advocated regulatory relief, modernizing the Bank Secrecy Act, ending credit union and farm credit system tax subsidies, enhancing customer data security, safe harbor for legal cannabis banking, and reforming the housingfinance system.

Su m m e r 2 0 1 9 | G e org i a Co m m un i ti es F i rs t | 9

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Conventions

41 stAnnual

Leadership Division Convention &

Min

i-Trade Show

Hilto n H e ad, S C

THURSDAY-SUNDAY, JUNE 6-9, 2019 Omni Hilton Head OCeanfront Resort

Attendees Re-energized at Hilton Head!

Hosted at the Omni Hilton Head Oceanfront Resort, HHI, SC, and Emcee’d by CBA’s very own President & CEO, John McNair, CBA’s 41st Annual Leadership Division Convention & Mini-Trade Show boasted family fun, a motivating keynote and a finale featuring some hilarious comedy and whimsical magic. As always, networking, making new friends and catching up with old ones was experienced as well. The attendees left feeling reenergized and singing, “Don’t stop me now!” The program included sessions focusing on peer analysis, how community banks can better tell their story, the many values of leaders, varying communication styles and an impassioned, motivational presentation

by Cam Fine, former President & CEO of Independent Community Bankers of America.

Presentations “How Does Your Bank Stack Up?” Shawn O’Brien, President, QwickRate Shawn presented detailed analysis on bank trends both nationwide and in Georgia.

He shared information and encouragement for banks to remain competitive with their peers.

“Stop Selling and Start Connecting: Why Your Marketing Program Isn’t Working” Patrick Dix, Vice President of Strategic Alliances, SHAZAM Patrick inspired the audience to start telling their own story and connecting with their customers rather than just plain selling to them. He shared several commercials of wellknown products that precisely drove his message home.

“Leading Through Values” & “Identifying Communication Styles” April Farlow, Leadership Coach & Tranier April taught the attendees how to recognize their own values, the bank’s values and their peers and teammates’ values. In a second, follow-up session, she shared the various communication styles which will help the audience members in their day-to-day operations in their businesses and at home and play.

“Community Bank Voices Matter!”

Cam Fine, President & CEO Calvert Advisors Cam reignited the passion within us all about the importance of community banking. He shared his years of experience of being compared to the larger banks and even credit unions, and reminded everyone about the significant role community banks play in the economy and for what they do for farmers, small businesses and other local entities.

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 11

Conventions

Entertainment Jonathan Burns, Comedic Magician Friday night’s desserts party included fun and games along with a wide assortment of delicious treats. Folks enjoyed more networking time and making new friends. Saturday’s night’s reception boasted a photo booth, kids tables with crafts and puzzles as well as face painting and a clown balloon artist. Following the Chairman’s Family Banquet, flexible comic and magician Jonathan Burns had everyone laughing and applauding.

The Mini-Trade Show The Mini-Trade Show was a huge success as usual with 27 exceptional vendors advertising their beneficial and cost-saving products and services. At the conclusion of the trade show, all bankers turned in their booth cards (denoting they’d visited every booth) for a drawing.

Paul Black, Vinings Bank, Smyrna, won the $300 cash prize, which was sponsored by Crescent Mortgage Company. Immediately after the Trade Show, attendees were able to continue conversations during the Networking Break, and then many vendors drew names and gave out their booth prizes (items included a Ring Doorbell system, Visa gift cards, Amazon Echo, Amazon gift cards, Atlanta Braves tickets, Yeti tumblers, coolers, cash and much more!).

Other Great Prizes!

The Friday and Saturday cash prizes ($250 each) were sponsored by ATM Response and FITECH respectively. We thank Clayton Braswell and Matt Mingenback for their generous support. Friday’s winner was Mike Underwood, Peach State Bank & Trust, Gainesville. Saturday’s winner was Jessica Hudson, First National Bank of Coffee County, Douglas. The “7-Minute Spotlight” was sponsored by Bankers Healthcare Group. Brian Mullett presented his company’s products and services. All bankers and bank directors in the audience were entered into a drawing for $1,000 in cash. Kyle Ray, First Bank, Dalton, was the lucky winner.

The CBA and its Leadership Division are extremely grateful for the support and participation of the invaluable Sponsors and Exhibitors! CBA also appreciates their attendees for spending several days with us at the Omni Hilton Head!

2019 Matt McCranie Leadership 2019 Leadership Division of the Year Division Representative of the Year

Division 6 chaired by Thomas Bennett, Pineland Bank, Alma, and Jonathon Guthrie, The Peoples Bank, Willacoochee 1 2 | ww w.cbaofga.co m | Summer 2019

Eli Tinsley, Executive Vice President, Planters First Bank, Cordele

2019 Winners of the Children’s Healthcare Fundraiser “Rally Around the Bell”

Seller of the highest number of tickets: Daniel Lopez, United Community Bank, Jasper; Grand prize winner: Greg Proffitt, Newton Federal Bank, Covington

Conventions

Thank You to Our Sponsors! platinum sponsors

silver sponsors

bronze sponsors

General sponsors

individual event sponsors

Board Appreciation Reception & Dinner Co-Sponsors

Welcome Refreshments

Family Reception, Dinner, Entertainment Co-Sponsors

Convention Totes

Charging Station

Convention Tumblers & Meeting Space WiFi

Registration Packet

Board Meeting Refreshments

Friday Breakfast

Bottled Water

Mini-Trade Show Cash Drawing

Saturday Breaks

Friday Networking Break

Friday Night Party - Desserts & Outdoor Games Co-Sponsors

7-Minute Spotlight

Saturday Cash Prize

Hotel Key Card

Kids’ Welcome Kit & Friday Cash Prize

Name Badges & Friday Promo Items

Saturday Promo Items Saturday Breakfast

Photo Booth

Convention Signage

Convention t-shirt Sponsors Premier Sponsor

THANK YOU TO OUR EXHIBITORS! ACG • Ameriprise Financial Institutions Group • ATM Response • BankSmart • CashTrans • Check Printing Solutions Computer Services, Inc. • Crescent Mortgage • CRS Data • Cummins-Allison Corporation • DeNyse Companies • First Bank Mortgage Partners Fitech • Genesys Technology Group • Harland Clarke • Intercept Consulting Group • Pentegra • Point to Point Environmental • QwickRate SBA Works • Secureworks • SHAZAM • STS Group • The Baker Group • Top Flite Funding • Travelers • VGM Forbin Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 13

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Conventions

CBA Leadership Division Elects

New BOARD of Directors Executive committee

Chair: Greg Proffitt – Newton Federal Bank, Covington Chair - Elect: Paul Black – Vinings Bank, Smyrna 1st Vice Chair: Brian Bazemore – Community Bank of DublinLaurens County 2nd Vice Chair: Trudy Eller – American Commerce Bank, N.A., Bremen Immediate Past Chair: Debra Weil – Community Banking Co. of Fitzgerald

Members at Large

Kristy Brown – Greater Community Bank, Rome Stephanie Fagler – Persons Banking Company, Swainsboro Zac Frye – Durden Banking Company, Swainsboro Jessica Hudson – First National Bank of Coffee County, Douglas Jason Rooks – Flint Community Bank, Albany Andy Thomas – The Commercial Bank, Crawford Eli Tinsley – Planters First Bank, Cordele Dan Vano – Heritage Bank, Fayetteville Lee Vaughn – Northeast Georgia Bank, Elberton Peake Wilson – CBA of Georgia, Atlanta

Div. 1 Chair: Kyle Ray – First Bank, Dalton Vice Chair: Lisa Shrader – Citizens Bank & Trust, Trenton Div. 2 Chair: Mike Underwood – Peach State Bank & Trust,

Gainesville Vice Chair: Daniel Lopez – United Community Bank, Jasper Div. 3 Chair: Chris Cochran – Affinity Bank, Atlanta Vice Chair: Josh Osborne – Oconee State Bank,

Lawrenceville Div. 4 Chair: Jonathan Pope – Exchange Bank, Milledgeville Vice Chair: Vacant Div. 5 Chair: Michael McGahee – Bank of Camilla Vice Chair: Chip Davis – Family Bank, Pelham Div. 6 Chair: Jonathon Guthrie – The Peoples Bank,

Willacoochee Vice Chair: Thomas Bennett – Pineland Bank, Alma Div. 7 Chair: Jim Cowart – Durden Banking Company,

Twin City Vice Chair: Lee Dubberly – South Georgia Bank, Glennville Ex-Officio: John McNair – CBA of Georgia, Atlanta

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Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 15

Conventions

51st Annual Convention & Mini-Trade Show

Thursday-Sunday, September 12-15, 2019 The Ritz-Carlton, Amelia Island, FL CBA invites you to join us in Amelia Island, FL, for the 51st Annual Convention & Mini-Trade Show at The Ritz-Carlton! We’ve lined up dynamic speakers to cover a wide variety of topics with you in mind. Additionally, we’ve added informative Concurrent Sessions for your training needs. Friday and Saturday’s General Session and Concurrent Session topics include Liquidity Management, CEO & Executive Succession Planning, BOLI, Innovation & Fintech, Economic & Banking Trends in Georgia, SB 157, Human Resources, and more!

Learn more Register Here

On Thursday night, join us for our welcome reception with desserts, coffee and cocktails, and participate in CBA’s popular Silent & Live Auctions! In the Friday General Session, hear from Georgia Lieutenant Governor Geoff Duncan. On Friday and Saturday, take part in the 7-Minute Spotlights where you could win $1,000 after hearing two informative presentations. On Saturday evening, join us for the Chairman’s Reception & Banquet. We look forward to seeing you at Amelia Island!

Friday General Session A Conversation with the Regulators Panelists include Mike Dean from the FDIC, Jason Sisack from the OCC and Melissa Sneed from the GA Dept. of Banking & Finance. CBA’s Lori Godfrey will moderate.

7-Minute Spotlights Two Chances to Win $1,000 in Cash Must Be Present to Win! CBA is pleased to announce two informative, presentations. Matthew Shugart from Fiserv and Asaad Faquir from PrismPremier will each present their own 7-Minute Spotlight during the General Session - one on Friday and one on Saturday. Simply enjoy the presentation, complete an entry form, and a drawing for $1,000 will be held immediately after the presentation. Only Bankers and Bank Directors are eligible.

Good luck!

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The Mini-Trade Show CBA is known for its one-of-a-kind Mini-Trade Show offering bankers and exhibitors the opportunity to network in a time-efficient setting.

Bankers can get up-to-speed on the latest products and services designed for community banks.

Immediately following the Mini-Trade Show, the CBA will host a 30-minute refreshment break featuring networking and great prizes! For more information on the Mini-Trade Show, contact Lindsay Greene at lindsay@cbaofga.com.

“State of the State” Geoff Duncan Lieutenant Governor of Georgia A former professional baseball player and successful entrepreneur, Geoff Duncan was elected Georgia’s Lieutenant Governor in November of 2018.

Conventions

Friday Concurrent Sessions Pre-registration for all concurrent sessions on Friday and Saturday is required; lunch will be provided to those who pre-register.

2:00 - 2:45 pm How To Dynamically Measure, Monitor and Manage Your Liquidity in a Volatile Rate Environment Matt Harris SVP, Assistant Director of Asset/ Liability Management, The Baker Group

2:50 - 3:35 pm

Georgia’s Ag Economy

Enhanced Strategic Planning in the Era of Digital Transformation

Gary Black Georgia Commissioner of Agriculture

Ten Best Practices in CEO and Executive Succession Planning

Steve Cotton CEO & Founder, FI Navigator

Saturday General Session

Alan J. Kaplan Founder & CEO, Kaplan Partners

schedule Thursday, September 12th

Dawn Breakers’ Session

How Innovation and Fintech will Shape the Future of Banking Kevin Tweddle Chief Operating Officer and Chief Innovation Officer, ICBA

BOLI: The Most Misunderstood Revenue Generator John Gianacaci Southeast Regional Managing Director, BFS Group

ICBA Report Robert M. Fisher Vice Chairman, ICBA; Chairman, President and CEO of Tioga State Bank, Spencer, NY

Facilitated by Lori Godfrey, CBA of Georiga; Michael White, James-Bates-Brannan-GrooverLLP; Danny Capitel, Promontory Interfinancial Network; and a representative from The Baker Group

Ronald W. Sims II, CFA Regional Manager, FDIC’s Division of Insurance and Research

Saturday Concurrent Sessions 1:15 - 2:00 pm

Empower Your HR and Payroll Teams with Systems That Help Keep You in Compliance Sherry Burick, CBIZ Human Capital Management

afternoon & evening

Convention Registration Exhibitor Set-Up Board of Directors Meeting & Dinner (by invitation only) Desserts, Coffee & Cocktail Reception & Auctions Friday, September 13th morning

Breakfast General Session with Mini-Trade Show 7-Minute Spotlight

Options for Municipal Deposits Post SB 157

Economic and Banking Trends in Georgia

morning free

afternoon

Lunch Buffet Concurrent Sessions evening free

Saturday, September 14th morning

Dawn Breakers Session Breakfast General Session 7-Minute Spotlight afternoon

New Technologies: The Future of Payments

Lunch Buffet Concurrent Sessions evening

Patrick Dix, Vice President of Strategic Alliances, SHAZAM

Chairman’s Reception & Banquet Sunday, September 15th Departures

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 17

Conventions

Thursday Night Desserts, Coffee, Cocktails

Silent & Live Auctions

After dinner on Thursday night, join us and enjoy a welcome reception with various desserts, coffee and cocktails and network with your peers. Participate in CBA’s popular Silent & Live Auctions. The auctions are your chance to purchase sports tickets, memorabilia, gift cards, restaurant packages,

vacation getaways, jewelry, novelty and one-of-a-kind items. All proceeds benefit CBA’s Political Affairs Committee (PAC) and Public Relations (PR) funds. CBA maintains the only state PAC working exclusively for Georgia’s community banks.

Support the 2019 CBA Silent & Live Auctions Please support the fundraiser by donating to the Silent Auction. Popular items include electronics, artwork, collectibles, sports memorabilia/tickets, use of a condo or vacation property, children’s items, gift baskets, gift cards, home décor, jewelry and much more.

If you cannot donate an item for the auction, consider a cash donation. Click here to complete the donation form. Please send to Lori Godfrey at lori@cbaofga.com or 770-5414684. We appreciate your support!

Celebrating a

LIFETIME OF SERVICE MARGARET AYERS

of Northeast Georgia Bank, Lavonia Margaret Ayers was recognized recently by CBA for 75 years of dedicated service to the community banking industry. She has been on the Lavonia Chamber of Commerce since 1944, a member of the Lavonia United Daughters of the Confederacy since 1951, a member of the Lavonia Lions Club since 1986, on the Lavonia Housing authority board since 1996, a Habit board member since 1998, on the Friends of the Lavonia Library Board since 2004, The Franklin County United Way board since 2005 and a board member of the Power of Hope since 2010. She is a charter member of the Pilot Club of Lavonia and a Trailblazer of Lavonia.

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CBA is proud to honor bankers who have reached a significant milestone in the banking industry with the Lifetime Service Awards. CBA pays tribute to bankers reaching a milestone of 30, 40 or 50 years in the community banking industry. The presentation will be made during the 51st Annual Convention & Mini-Trade Show.

The 2019 deadline to submit honorees is Friday, August 2, 2019.

As part of the recognition, honorees receive a commemorative plaque, and CBA will feature the honorees in various CBA publications, as well as provide a Press Release. Honorees with 50 or more years of service also receive a customized gold and diamond lapel pin. If you or someone in your bank is celebrating 30, 40 or 50 years of service as a banker during this calendar year, please contact Peake Wilson at peake@ cbaofga.com or (770) 541-0379 or visit CBA’s website, www.cbaofga.com; click on the Communications Tab and then Lifetime Service Awards.

Conventions

Thank You to Our Sponsors

silver sponsors

bronze sponsors

General sponsor

individual event sponsors

Financial Institutions Group

Board Appreciation Reception & Dinner Co-Sponsors

In-Room Gifts

Charging Station

Video Message Friday General Session

Saturday Breaks

Convention Totes

Board Meeting Refreshments & Saturday Cash Prize

Chairman’s Reception & Banquet Co-Sponsors

Convention Tumblers & Friday Cash Prize

Name Badges

Thursday Night Desserts and Coffee & Mini-Trade Show Cash Drawing

Friday 7-Minute Spotlight

Saturday 7-Minute Spotlight

Hotel Key Cards

Saturday Lunch Buffet

Convention Program

Registration Packet

Thursday Night Hosted Bar

Friday Lunch Buffet Co-Sponsors

Welcome Refreshments & Bottled Water

Friday Breakfast

Friday Promo Items

Saturday Promo Items Saturday Breakfast

Photo Booth

Convention Signage

Thank you to our exhibitors!

Ameriprise Financial Services • ATM Response • ATM USA, LLC • Atris Technology • BFS Group • CBIZ Computer Services, Inc. • CRA Partners • Crescent Mortgage • Cummins-Allison Corporation DeNyse Companies • Eclipse Brand Builders • FITECH • Hamilton Mortgage • Harland Clarke Holtmeyer & Monson • Intercept Consulting Group • J.B. Lloyd & Associates, LLC • Kasasa • Pentegra Point to Point Environmental • Promontory Interfinancial Network • QwickRate • SBA Works • SecureWorks SHAZAM • STS Group • The Baker Group • TJS Deemer Dana • Travelers • VGM Forbin For more information on sponsorships, please contact Lindsay Greene at lindsay@cbaofga.com.

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 19

e d u c at i o n

EDUCATION ACCESS WHEN AND WHERE YOU CHOOSE

WEBINARS

CPE CREDITS FROM THE COMFORT OF YOUR OWN SCREEN

CBA is committed to superior customer service and has been a leader in webinar training for over a decade. Webinars are designed for most positions in a community bank from the teller line to the board room. Speakers are industry experts with long-term, real-life, hands-on experience. Benefits of participating in a CBA webinar are: • Easy to use, time effective, cost effective, convenient, interactive • Current topics delivered by experienced speakers

• Continuing Professional Education Credits • Take-Away-Toolkit (consists of an employee training log and a quiz to measure staff learning) • Webinar series for Bank Directors, Compliance Professionals, Risk Managers, Leaders, and much more!

Register today for a webinar training option that best meets your training needs! For the most current listing of webinars, visit www. cbaofga.com.

AUDIT & ACCOUNTING

COLLECTIONS

COMPLIANCE

1/16: Call Reports 2019 Update

6/19: Consumer Collection Series: Effective Debt Collection Techniques & Strategies

11/13: Year-End Compliance Checklist

11/20: BSA Special Risks: Policy, Law Enforcement & Regulator Issues

DIRECTORS

5/2: Call Report Series: Call Report Basics, Including Balance Sheet, Income Statement & Related Schedules 6/13: Call Report Series: Preparing Call Report Lending & AllowanceRelated Schedules 7/2: ALLL Supporting Documentation: Current Rules & Future Expectations Under CECL

7/23: Call Report Series: Call Report Regulatory Capital, Including Key Changes & Other Schedules

8/20: Call Report Series: Introduction to Call Report Loan Classifications

9/4: Auditing E-Policies & Procedures: Risks, Rules & Records

9/10: Conducting the 2019 ACH Audit

9/17: Regulation E Series: Auditing for Reg E Compliance

COLLECTIONS 1/28: Real Estate Loan Collection Rules for Lenders & Mortgage Servicers 4/18: Consumer Collection Series: Your Borrower Filed Bankruptcy, Now What?

5/10: Successful Skip Tracing Techniques for Locating Borrowers & Recovering Collateral (Morning Webinar)

5/21: Consumer Collection Series: Repossession Practices, Compliance & Limitations

7/30: Consumer Collection Series: 20 Common Mistakes in Consumer Collections COMPLIANCE 2/4: Flood Insurance Compliance Update & FAQs 3/19: Advanced BSA Officer Training: In-Depth Risk Issues & Difficult Situations 4/2: UDAAP: Consumer Complaint Monitoring & Avoiding Harm 5/8: BSA Series: Job-Specific BSA Training for Lenders 6/3: Fair Lending Examinations: Increased Scrutiny, New Methodologies & False Positives

6/4: BSA Series: Job-Specific BSA Training for Operations

7/16: BSA Series: Job-Specific BSA Training for the Frontline

8/21: E-Compliance Rules, Policies & Best Practices for Email, Web, Mobile & Social Media

9/19: New Compliance Officer Boot Camp

10/3: New BSA Officer Training Part 1: Compliance, Risk Assessment, CTRs, Exemptions, Forms & Regulator Expectations 10/17: New BSA Officer Training Part 2: Reviews, SARs, CDD, Technical Aspects & RealLife Scenarios

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CPE CREDITS AVAILABLE

3/28: Board Reporting Series: Red Flags in Board Reports 6/10: Community Bank Mergers & Acquisitions Simplified

6/26: BSA Series: Job-Specific BSA Training for the Board

9/25: What Directors Should Know About CECL, ALLL & the New Credit Impairment Standards FRONTLINE & NEW ACCOUNTS 1/10: Teller Training Series: Compliance Training for the Frontline 1/30: Teller Training Series: Frontline Fraud Prevention: Stopping Fraud at the Teller Line

2/20: Teller Training Series: Risks & Precautions for Endorsements & Other Negotiable Instruments

3/12: Teller Training Series: Cross Selling: The Key to Accountholder Satisfaction & Retention 3/27: Handling Power of Attorney & Living Trust Documents on Deposit Accounts & Loans

4/9: Teller Training Series: Accurately Completing the CTR Line-by-Line

4/11: Notary Essentials & Legalities

FRONTLINE & NEW ACCOUNTS 5/14: Teller Training Series: Managing Dual Control & Cash Limits

6/25: Living, Grantor & Family Trust Accounts: Common Problems in Account Opening & Lending

7/1: Managing Accounts & Records for Nonresident Aliens: Monday Opening, Identifying, Monitoring & Tax Reporting

HUMAN RESOURCES 6/12: Essential HR Recordkeeping from Hiring to Firing 9/24: Hiring in the Digital Age: What Every HR Manager Needs to Know About Social Media

IRA

7/24: Opening Accounts Online: Rules, Risks & Best Practices

8/29: Opening Donation, Memorial & Other Accounts for Nonprofit Organizations & Corporations

1/17: IRA & HSA 2019 Update, Including Tax Reform Considerations

7/9: IRA Series: Processing IRA Rollovers & Transfers

8/6: IRA Series: IRA Reporting, Common Issues & Error Resolution

8/27: IRA Series: Top 10 Most Misunderstood IRA Issues: Turning Confusion into Confidence

9/12: Managing Minor Accounts: Withdrawals, Transfers, CDD, Closing & Best Practices

9/16: IRA Series: Handling IRA Required Minimum Distributions & Roth Distributions

10/9: Head Teller Training: Maximizing Teller Performance

INFORMATION TECHNOLOGY

10/16: POD Account Documentation, Compliance, Beneficiaries & Closing

10/22: Medallion & Signature Guarantee Risks, Rules & Best Practices 10/30: Personal Accounts: Ownership, Authorization, Titling & Documentation

11/6: Closing or Changing Accounts for Consumers & Businesses

12/10: Business Accounts: Who is Authorized to Open, Close, Transact?

2/27: The New NIST Digital Identity Guidelines: Impact on Passwords, Security Questions & Account Lockouts

3/11: Synthetic ID Fraud: What It Is, How It Works & Real-Life Scenarios 4/4: Mobile Device Risks, Records & Compliance Rules: Managing Your BYOD & COPE Policies & Procedures

4/23: Hacking the Weakest Link: The Role of Staff in Maintaining IT Security

5/15: Hot Issues in Cyber Compliance

6/27: Card Data Security: PCI-DSS Risk, Readiness & Compliance

e d u c at i o n INFORMATION TECHNOLOGY 8/15: FFIEC Cyber Security Risk Assessments: Policy, Recent Findings & Recommendations

9/18: Mitigating a Data Breach: Forensics & Incident Response

9/26: Emerging Trends & Developments in Online, Mobile & Digital Channels

LENDING 1/9: Credit Analysis & Underwriting Series: Regulator Issues & Update for the Credit Analyst

1/15: 2018 HMDA Submission Due March 1, 2019 Part 1: Identifying Reportable Loans, Data Integrity & FIG Analysis

1/23: 2018 HMDA Submission Due March 1, 2019, Part 2:Requirements, Clearing Edits, Exempt Fields & More

1/24: Determining Cash Flow from Personal Tax Returns After 2018 Tax Reform Part 1: Newly Revised Form 1040 & Schedules B & C 1/29: Credit Analysis & Underwriting Series: Analyzing Financial Statements for the Credit Analyst

1/31: SBA Lending 2019 Update: Guidance on the Latest Changes to Policies, Procedures & Documentation

2/21: Credit Analysis & Underwriting Series: Debt Service Coverage Calculations in Underwriting 2/25: Determining Cash Flow from Personal Tax Returns After 2018 Tax Reform Part 2: Schedules D, E & F

3/20: Required Compliance for Commercial Loans Secured by Real Estate

3/26: Credit Analysis & Underwriting Series: Global Cash Flow Analysis for Underwriters & Credit Analysts 4/5: New Private Flood Insurance Rules Effective July 1, 2019: Policy, Procedures & Compliance (Morning Webinar)

4/17: Flood Insurance Compliance for Commercial Lending: Unique Issues & Case Studies

4/22: Top 20 Questions About Completing the TRID Loan Estimate & Closing Disclosure 4/25: Advanced Credit & Risk Management in Agricultural Lending

LENDING

MARKETING

OPERATIONS

SENIOR MANAGEMENT

4/30: Escrow Account Compliance, Including Shortages, Surpluses & Deficiencies

5/1: Troubled Debt Restructuring: Identifying & Accounting for Impaired Loans

5/9: Developing & Delivering an Effective Loan Presentation

10/29: 12 Key Elements of an Effective Digital Marketing Strategy

8/22: Regulation E Series: How to Handle Unauthorized Electronic Fund Transfers Under Reg E

2/12: Board Reporting Series: Board Secretary Procedural & Compliance Responsibilities

8/28: Effective Management of Credit Report Disputes: Completing ACDVs, AUDs & Correcting Joint Credit

9/5: Official Demands Part 2: Handling Garnishments, Levies & Judgment Liens

10/8: When a Depositor Dies: Legal Requirements, Practical Issues & FAQs

10/10: Regulation E Series: Reg E Requirements for Debit Card Error Resolution: Processing, Disclosure & Investigation

3/5: Board Reporting Series: Essential Board Reporting: Requirements, Timing, Delivery Options, Risks & Concerns

5/23: Advanced Commercial Loan Documentation

5/29: Military Lending Act & SCRA: Compliance & Lessons Learned 6/6: Mortgage Lending Hot Spots Series: Construction-Only & Construction-toPermanent Lending

7/10: Mortgage Lending Hot Spots Series: Surviving a TRID Compliance Exam 7/15: Introduction to SBA Lending 7/25: From Prospect to Customer: Skills & Tools for Successful Business Development 8/8: Mortgage Lending Hot Spots Series: Adverse Action in Mortgage Lending: Compliance, Notices & Best Practices

8/14: What Are Those Business Tax Returns Telling Me?

9/11: Mortgage Lending Hot Spots Series: Appraisal & Evaluation Guidance on Collateral Valuation

10/7: Mortgage Lending Hot Spots Series: Demystifying Rules for TRID Tolerances

10/24: Commercial Loan Annual Credit Review

11/12: Mortgage Lending Hot Spots Series: Uniform Residential Loan Application (URLA) Lineby-Line, Required February 1, 2020 11/21: When a Borrower Dies: Rules, Procedures & Liabilities

12/11: Topic Change to Be Announced

12/17: Securing Collateral: How to Complete & File UCC-1 Financing Statements

MARKETING 3/6: Federal Requirements for Tech-Based Marketing: Websites, Social Media, Robo Calls & More

11/7: Top 10 Compliance Mistakes in Advertising OPERATIONS 1/8: Record Retention & Destruction Rules: Paper & Electronic

2/5: ACH Specialist Series: ACH Tax Refund Exceptions, Posting & Liabilities

2/6: Right of Setoff on Deposit Accounts & Loans: Legal Issues 2/13: Prepaid Cards: Your Bank’s Responsibilities Under the New Rules, Effective April 1, 2019 2/26: ACH Specialist Series: ACH Dispute Resolution

2/28: Debit Card Chargebacks: Understanding Visa Claims Resolution 3/13: Debit Card Chargebacks: Understanding Mastercard Dispute Resolution

3/14: ACH Specialist Series: 2019 ACH Rules Update

3/21: Banking MarijuanaRelated Businesses

4/15: ACH Specialist Series: Liability with ACH Death Notification Entries (DNEs) & Reclamations

5/16: ACH Specialist Series: Top 10 Ways to Mitigate ACH Payment Risk

5/30: ACH Specialist Series: ACH Stop Payments vs.

Unauthorized Extended Returns: Know the Difference

6/5: Handling Dormant Accounts, Unclaimed Property & Escheatment 6/14: Hemp Farming Act: CBD, FAQs & Impact on Financial Services (Morning Webinar)

6/17: Untangling Complex RDFI Challenges 6/18: Electronic Returned Items: Combating Fraud

6/20: Regulation E Series: Reg E Fundamentals

7/17: Regulation E Series: Legally Handling ATM & Debit Card Claims Under Regulation E

7/18: Wire Transfer Compliance, Including International Remittances

8/5: Official Demands Part 1: Handling Subpoenas, Summonses & Other Legal Process

10/31: 1099 Reporting: Foreclosures, Repossessions & Debt Settlements

11/14: Regulation E Series: Provisional Credit Under Reg E: Rules, Best Practices & FAQs

11/26: Understanding & Navigating ACH Rules for ODFIs 12/3: IRS Reporting Requirements: 1098s, 1099s, TINs & Backup Withholding

12/4: ACH Error Resolution: Returns, Authorizations, WSUDs, Stop Payments & More

12/12: Safe Deposit Issues: Delinquency, Death & Abandonment

SECURITY & FRAUD 4/16: Board Reporting Series: Security Officer Reports to the Board: Fulfilling Your Annual Requirement 5/6: Accurately Completing the SAR Line-by-Line

3/7: C-Suite Series: Strategic Decisions Regarding CECL Methodologies, Processes & Governance

4/3: C-Suite Series: Enterprise Risk Management: Three Key Risk Assessments

4/24: C-Suite Series: Asset Liability Management Strategies in a Rising Rate Environment 5/22: The UBPR: Understanding Peer Group Comparison to Improve Bank Performance

8/1: Outsourcing Tech Services: Regulations, Examiner Expectations & Actions for Vendor Management

8/13: Developing the Right Strategic Plan for Your Bank

Most webinars are scheduled from 3:00 pm - 4:30 pm EST unless otherwise indicated.

Please visit www.cbaofga.com for webinar details.

To learn more or to register, visit www.cbaofga.com or contact Connie Shepherd at Connie@cbaofga.com or 770-541-4490.

Note: Dates/topics subject to change.

5/31: Complying with the 2019 SAR Cyber-Event Reporting Requirements (Morning Webinar) 7/11: FinCEN Guidelines on Reporting Elder Financial Exploitation

8/7: New Security Officer Training: Responsibilities, Best Practices & SkillBuilding Tools 11/19: Robbery Preparedness: Meeting Your Annual Compliance Requirement

SENIOR MANAGEMENT 1/14: FFIEC Exam Procedures for Business Continuity

If you find a webinar that has already passed, you can purchase the recording and download the materials to watch anytime that best fits your needs.

2/7: C-Suite Series: CAMELS Rating for Executives

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 21

e d u c at i o n

Community Bank Professional Development

Education Buzz

Community Bankers Graduate from Our Inaugural

Compliance Officer Boot Camp

Kristi Greer Director of Professional Development Community Bankers Association of Georgia

“Where’s the Beef?” I remember this popular statement from a fast food advertisement back in the 80s and 90s. We are striving to bring more “meat” and educational content to the professional development programs we offer. We are excited to see our bankers engaged in our training sessions, roundtables, conferences, conventions and newly formed committees. We also appreciate the feedback and suggestions you are giving us as we raise the bar and provide even more value to you and your bank employees.

Check out the enhancements we have made to these upcoming programs: •

Advanced BSA School - August

•

Cyber Summit – August

•

Brand new School: Advanced Commercial Lending - August

•

Bank Security/Workplace Violence Conference September

•

CFO/Financial Officers Conference – October

•

Even more enhancements coming in 2020

Access our website at www.cbaofga. com, hover over the professional development drop down menu to find the professional development you need either using the calendar or the listing by functional area of community banking.

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Eighteen bankers from across the state graduated with a comprehensive insight on working effectively as a compliance officer and incorporating compliance in all staff roles. Attendees enjoyed the new format, hands on learning, and tools which were immediately applicable to their daily duties. A participant of the school, Donita Roberts, The Peoples Bank in Eatonton, GA, shared, “Leah was funny and added humor to compliance.

The material is awesome and great to use topics were on target with compliance.”

“The Compliance Officer Boot Camp is the first of its kind,” said Hamilton.

“ProBank Austin is proud to be at the forefront of this hands-on educational experience for staff from all areas of the bank. Compliance is every bank employee’s responsibility every day. Partnership, collaboration and networking are keys to compliance success and the Compliance Officer Boot Camp sets that foundation.”

Yes, CBA of GA plans to hold this boot camp again in 2020.

Professional Development for

Lending Team Members Are you sick of the same old lending courses? Break out of the mundane with CBA’s Lending Track, your choice of lending subjects. Your one-stop-shop for all tools needed to become a well-rounded, knowledgeable and successful lender.

Loan Documentation Boot Camp – Your choice: Consumer, Commercial or both!

August 6 and/or 7, Idle Hour Country Club, Macon BRAND NEW SCHOOL! The Advanced Commercial Lending School August 20-23, Marriott Macon City Center - Includes specialized lending topics.

Analyzing Personal & Corporate Financial Statements & Tax Returns September 17-18, Idle Hour Country Club, Macon Commercial Lending School October 8-11, Idle Hour Country Club, Macon

2019

e d u c at i o n

Cyber Risk Summit Thursday-Friday, August 22-23, 2019 The Westin Savannah Harbor Golf Resort & Spa

1 1/2

Days

CPE CREDITS AVAILABLE

As we arrive at work, we log into networks and use many forms of technology.

We need software, hardware, technology systems, and electronic data in order to work smarter. Our employees need these tools and how do we protect them from scams and security attacks? How do we make our bank less vulnerable to cyber-attacks?

Join your fellow Information Security officers and bank team members at CBA’s Cyber Summit in Savannah. Everyone will leave with tactics, resources and application steps to support their bank’s information security cultures.

Industry Experts who will bring valuable knowledge covering topics including: the dark web, IT risk assessments, the new digital “zeitgeist,” handling security risks, how to tie this topic to business strategies and more. Plus, we are thrilled to have participants complete a hands-on Cyber Incident response exercise.

Contact us to get registered.

Scenes from the 2018 Cyber Risk Summit

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 23

LOOKING FOR A WAY TO ATTRACT HIGH-VALUE DEPOSITS? Turn to the nation’s #1 reciprocal deposit services: ICS®, or Insured Cash Sweep®, and CDARS®.

Grow deposits from relationship-based funding that increases franchise value. Use ICS and CDARS to offer access to multi-million-dollar FDIC insurance on funds placed into demand deposit accounts or money market deposit accounts (using ICS) and CDs (using CDARS), and: • Lock in more low-cost funding by attracting large amounts of stable funds from loyal customers • Replace less efficient collateralized deposits and rate-sensitive deposits from listing services • Make more dollars available for local lending Talk to us today! Contact Danny Capitel, Regional Director, at (866) 776-6426 x3476 or dcapitel@promnetwork.com.

Use of the ICS and CDARS services is subject to the terms, conditions, and disclosures set forth in the CDARS-ICS Participating Institution Agreement and applicable Deposit Placement Agreements. Limits apply, and customer eligibility criteria may apply. ICS program withdrawals are limited to six per month when using the ICS savings option. ICS, Insured Cash Sweep, and CDARS are registered service marks of Promontory Interfinancial Network, LLC.

m e mb e r s e r v i c e s

welcome new cba associate members!

Accumatch Mr. Keith Armstrong Property Tax Management Dallas, TX

Franklin Madison Ms. Erin Grote Insurance Services Franklin, TN

Sprout Funding Mr. Kevin Borth Financial Solutions Dallas, TX

AmTrust North America Ms. Tina Hobbs Insurance Services Cleveland, OH

Georgia Rural Investment Fund Ms. Mandi Boehringer Alternative Funding Atlanta, GA

Stone Castle Ms. Kim Weeks Alternative Funding New York, NY

The Community Bankers Association of Georgia (CBA) would like to welcome new Associate Members who were recently approved by the CBA Board of Directors.

Throughout the year, CBA’s Board approves quality vendors who provide products and services to CBA members.

Make sure your vendors are CBA members – please refer any potential Associate Members to Lindsay Greene at lindsay@cbaofga.com.

Apiture Ms. Beth Harvey Software Wilmington, NC

Kaplan Partners Mr. Alan Kaplan Executive Search Wynnewood, PA

Tacoma Capital Mr. Ryan Bannon Alternative Funding Atlanta, GA

Ascensus Ms. Heather Hoskins Retirement Services Brainerd, MN

KPN Consulting Ms. Jodi Swilley Consulting Roswell, GA

Bennett Thrasher Mr. Anton Hayward CPA Firm Atlanta, GA

Mastercard Mr. Jason Canik Credit Card Services Palm City, FL

VSoft Corporation Ms. Alicia McKinley Processing & Technology Solutions Duluth, GA

BoardPaq Ms. Lindsay Randazzo Software St. Charles, MO

Morris, Manning, & Martin, LLP Mr. John Lockett Legal Services Atlanta, GA

FI Navigator Mr. Edward Hunter Bank Analytics Austin, TX

Oculus Software/BNControl Mr. Shaw Lokey Software Cookeville, TN

WebbMason Marketing Mr. Geoff Rich Advertising/Marketing Atlanta, GA

Quality. Expertise. Trust.

Because You Deserve It • • • • •

External Audit Internal Audit Outsourcing Sarbanes-Oxley Act Consulting Risk Management Services Tax Consulting and Preparation

north georgia Ian Waller iwaller@nicholscauley.com

• • •

Regulatory Compliance Consulting Risk Assessment Consulting Information Technology Consulting

• •

Internal Control Evaluations Merger & Acquisition Assistance

• • • •

De Novo Consulting Loan Review Strategic Planning Valuation Services

south georgia Tim Veal tveal@nicholscauley.com

Financial, Compliance and Risk Management Services Offices Across Georgia | 800.823.0117 | www.nicholscauley.com

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2019

SAVE THE DATE

FALL PAC/PR

Clay SHOOT Thursday, October 10, 2019 Burge Plantation in Mansfield, GA

Community

Sa

lar

yS

urv

ey

Bankers

Salary Survey

Deadline to Participate is August 9th!

CBA is partnering with Pentegra to offer a survey focusing on salary and cash compensation for executive, middle management and staff level positions. To complete the survey, please contact Lindsay Greene at lindsay@cbaofga.com or (770) 541-0376.

Results Available Fall 2019

Eclipse CBA Ad (2019-05-29) w Marks.pdf

1

5/29/2019

Participating Banks:

FREE

Non-Participating CBA Members:

$275

12:41:05 PM

C

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Y

CM

MY

CY

CMY

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FIRST STATE BANK - NEW BRANCH OFFICE - HARLEM, GEORGIA

consulting + design + construction www.EclipseBrandBuilders.com Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 27

First Tennessee The DIFFERENCE When you work with First Tennessee Correspondent Services, you’ll get the personal attention that has made us a continuous provider of correspondent services for over 100 years. Contact a relationship manager about your bank’s needs at correspondentservices@ftb.com or toll-free at 800-453-7686.

Holding Company Loans • Fed Funds Letters of Credit • International Services Image Cash Letter • Settlement Services Commercial Safekeeping

©2019 First Tennessee Bank National Association operating as First Tennessee Bank and Capital Bank. Member FDIC.

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Julian & Jan Hester 2019 Hester

Schola

rship

memorial scholarship

The Community Bankers Association of Georgia is pleased to announce and congratulate the winners of the annual Julian & Jan Hester Memorial Scholarship. The 2019 scholarships were open to Georgia high school seniors who intend to enter a Georgia college, university or technical school in the fall semester of 2019. Applications were submitted to the association through CBA member community banks. Only four $1,000 scholarships are awarded each year.

The scholarship is named for the late Jan Hester, daughter of Lalia and the late Julian Hester, long-time CEO of the CBA. The scholarship program began in 1991 and is based on academic merit, not financial need. To compete, students must write a short essay on the characteristics of a community bank, and the continuing benefits they offer to their communities. In addition to supporting community banking, this scholarship fund is an opportunity to pass on the positive qualities both Julian and Jan Hester exemplified to further the development of tomorrow’s generations. Each winner receives $1,000 to the Georgia college, university or technical school of their choice.

Sam Collins

Caroline Duncan

University of Georgia Affinity Bank

University of Georgia Renasant Bank

Each applicant was required to write an essay on community banking and what it means to their community. These essays can be found on the Hester Scholarship webpage.

CBA also thanks the panel of judges Chris Cochran, Affinity Bank, Atlanta; Kelly Maxwell, Vinings Bank, Smyrna; Elyse Kellert, CBIZ Benefits & Insurance Services, Inc., Atlanta; Ashli Matson, Crescent Mortgage Company, Atlanta; and Dr. Don Sabbarese, Kennesaw State University (ret.).

Haley Hulson

Taylor Pearson

University of Georgia Rabun County Bank

University of Georgia The Claxton Bank

J. Steven Walraven memorial scholarship

Kaylyn Rawlings Abraham Baldwin Agricultural College (ABAC)

The Community Bankers Association of Georgia is pleased to announce the winner of the 2019 J. Steven Walraven Memorial Scholarship. Congratulations to Kaylyn Rawlings, Loan Administrator, OneSouth Bank (formerly Bank of Early) in Blakely.

Kaylyn was nominated by Kim Davis Wilson, President & CEO, OneSouth Bank. Kaylyn is attending Abraham Baldwin Agricultural College (ABAC) where she is majoring in Business to expand her knowledge and better excel in her banking career. This $500 scholarship is awarded to a Georgia community bank employee attending a college or university within the state of Georgia. The goal of the scholarship is to assist those employees interested in

2019 Walraven Scholarship

furthering their education to enhance their career in community banking.

All applicants were required to write an essay on community banking and how it enables bankers to give back to their communities.

The winning essay can be found on the Walraven Scholarship webpage.

The scholarship is named for the late J. Steven Walraven, a former community bank president who dedicated much of his life to his community and community banking. His wife Rebecca and their sons have developed the scholarship in his memory. Much of Steve’s life was dedicated to improving his community and community banking.

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CBA Strategic Partner

Spotlight

Kris st. martin, cbiz

In this issue, CBA is pleased to feature Kris St. Martin, Bank Services Director / Insurance Consultant, CBIZ. CBA invited Kris to participate in a Q & A so you can learn more about this Strategic Partner Company and a little more about Kris.

Kris St. Martin, CBIZ Tell us about CBIZ and your role with the company: CBIZ is a major provider of business services with 4,600 employees in 32 states. CBIZ has 3 offices and over 200 professionals serving Georgia with our main office in Atlanta.

CBIZ helps businesses succeed by helping them better manage their finances, risk and employees. Banking is one of our primary industry focuses. I spent over 20 years in banking with my most recent position being CEO and board chair of a De Novo bank in Minneapolis. In addition to banking, my specialties include Director’s & Officer’s Insurance, Cyber Risk and helping organizations identify and lessen risk. As the National Bank Services Director, I combine my experience in banking with CBIZ’s extensive resources to make sure that we are introducing the right CBIZ partner to fulfill our clients’ needs.

Kris and Becky Boe, now of CBIZ, breaking ground for Community Bank Plymouth What positions in the bank do you typically work with?

We have a number of services that ease the burden of work for the HR Director including payroll administration, time & attendance tracking, COBRA services and Employee Benefits.

The President and the CFO are typically very interested in the insurance coverage, particularly board member liability, cyber liability and perioic third party reviews of the bank’s overall

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Find Kris in the exhibit hall! insurance program. Our credit advisory services typically start with a conversation with the CEO or CFO and we end up working very closely with the chief credit officer.

What’s new? Any hot Products?

In 2018, the Department of Banking issued a policy on periodic reviews for Fidelity Bond and Directors’ & Officer’ coverage (DBF SUP 18-005). This Guidance has greatly increased the demand for CBIZ insurance reviews and we are completing these reports within 30 days. In addition to checking a regulatory box, the report provides a great tool when working with your agent and insurance carriers. Also, due to the difficulty in finding quality credit analysts in many markets, Kristin Stanton and our credit advisory team have been very active. Her team bills by the file to spread financial statements and provide industry ratios and their work is completed within 48 hours. We also can provide global personal and business cash flow for the more complex borrowers. Matt McCoun and our Alpharetta insurance team are working closely with lenders to provide education on how to lower borrower risk through proper insurance. Matt recommends incorporating an insurance check list for the top 10% loan balance clients.

Matt can also provide the borrower with a second opinion on their insurance program which has proved to be very enlightening the borrowers. On the HR front, Sherry Burick and our Human Capital Management team are having great success providing Payroll & HR solutions using a customizable single data platform that eliminates spreadsheets to make work easier and more productive. This pre-hire to post-retire system delivers a great employee experience.

Interesting facts about you: Many people are impressed that I was a CPA before I graduated high school. I try to change the subject before it comes out that it stands for Car Parking Attendant. I have an Economics

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American bank client, I have not given up hope. I think I need to keep working on my Spanish. My family all loves baseball and our favorite team is the Minnesota Twins. I hesitate to note that the last time the Twins won the World Series was in 1991 and they beat the Braves with an 11 inning Jack Morris shut out. Maybe a 2019 rematch? Kathleen loves coming to the CBA annual meetings and takes pride in her unofficial title as the Spousal Event bartender. CBIZ also has the best exhibitor booth drawings with Kathleen provided jewelry prizes.

For more questions on CBIZ, contact Kris at (763-549-2267) or kstmartin@cbiz.com

Where did the time go? degree from the University of Minnesota and went on to work in the banking industry for 20 years. Kathleen and I have 3 children; a wild land firefighter, a marketing manager and a 3rd year law student. Kathleen was born in Georgia and considers herself a Southern Girl at heart.

What do you fo for fun outside of work?

Kathleen is a business owner and we are often able to incorporate our business and personal travel. We have been to Colombia four times to buy emeralds for Kathleen’s business and although I continue to be unsuccessful in securing a South

International Services In today’s rapidly changing environment, you should expect simplicity, efficiency and exceptional customer service.

CenterState has a full service International and Foreign Exchange Group.

• Maximize Income Opportunities • Automated Reg E Receipts and Disclosures • Straight-Through-Processing Available via Your Existing Wire System • Enhance Efficiencies with Import/Export Features • Exceptional Customer Service

Services Include: Wire Transfers in Foreign Currency and US Dollars, Banknote Services (with next day delivery), Foreign Check Clearing and Foreign Drafts.

770.850.3420 400 Interstate North Pkwy., Ste. 1200 Atlanta, GA 30339 jreynolds@centerstatebank.com www.csbcorrespondent.com

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 31

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How to Cost-Effectively Leverage the Benefits of SBA/USDA Lending

Community banks across Georgia continually seek two critical inputs – good commercial loan growth and non-interest fee income – to grow their institutions, serve existing customers, and add new ones. These key factors can assure the bank’s viability and survival.

Two of the best solutions for accomplishing these objectives are the SBA and USDA lending programs. They do more than provide capital to creditworthy borrowers at reasonable terms and rates. Government-guaranteed loans can generate huge profits for the bank from fees, interest and sales premiums on loans they otherwise might not have made.

A wealth of benefits for community banks While helping to enrich their communities, banks writing government-guaranteed loans can cost-effectively enjoy: • Tremendous profitability driven by fees and sales premiums on guaranteed portions of loans

•

Assured liquidity, supplied by guaranty sales, to fund new loans and contingency needs

•

Lower capital risk weighting on guaranteed loans is much lower than unguaranteed loans

•

Additional relationships may result from borrowers opening new accounts (payroll, checking, etc.)

How your bank can realize these advantages?

SBA/USDA lending is a specialized credit granting activity, with procedures somewhat different from conventional C&I lending. Government guaranteed loans must adhere to precise requirements, and banks can run into trouble by not specifically following agency protocols and processes.

So how can banks with limited human resources and unpredictable loan volumes cost-effectively navigate these requirements?

•

Expanded customer base from serving borrowers who don’t qualify for conventional financing

The answer is simple. Engage a qualified Lender Service Provider.

•

Potential CRA rating impact because SBA/USDA loans may be eligible for consideration

•

Greater loan amounts since guaranteed loan portions don’t count in legal lending limits

A knowledgeable, reliable and highly experienced service provider can be your bank’s fully-staffed, outsourced SBA/ USDA loan department. For the best possible success, the provider should deliver technical expertise in all these

SBA and USDA Loan Programs: SBA 7(a) Loans Maximum credit

$5 million

Minimum

None

Guaranty amounts

Up to 85% for loans of $150,000 or less

USDA B&I Loans Maximum credit

Usually $10 million, may be higher

Minimum

None

Guaranty amounts

Up to 60%-80% based on loan sizes

Guaranty sales income

Earned in secondary market and direct sale to Farmer Mac

Up to 75% for larger loans Guaranty sales income

Earned in secondary market

Annual service fee income Typically 1% on guaranties sold

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Ongoing service fee income Negotiated

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Holtmeyer & Monson provides over 400 lenders the peace of mind and financial comfort of knowing their guaranties are intact and viable. As a CBA of Georgia Endorsed Provider, an ICBA Preferred Service Provider since 2006, and the country’s largest SBA/USDA Lender Service Provider, we stand ready to help Georgia banks reap the unique benefits of government-guaranteed lending.

For more information, please contact Arne Monson at 800-340-7304 or amonson@ holtandmon.com.

CO N

US

In conclusion SBA/USDA lending provides opportunities to produce excellent commercial loan growth and the highest-yielding activity available, with a reasonable level of risk. Done right, this can be life changing for community banks. But while a government guarantee is a wonderful credit enhancement, it is NEVER an excuse to make poor credit decisions.

Protecting the integrity of a government guarantee is essential.

CT WIT E N

H

areas: loan eligibility analysis and underwriting assistance; application preparation; loan closing services; securitization and sale of loan guarantees; portfolio management; and regulatory compliance reviews.

These comprehensive capabilities can ensure cost and quality control while driving potential profits.

FACEBOOK @CBAOFGEORGIA

LINKEDIN @CBAOFGEORGIA

Arne Monson

President Holtmeyer & Monson A CBA Endorsed Member Company

TWITTER @CBAOFGEORGIA

Are You Ready for the Next Big Thing?

We are and so are our bankers!

Staying ahead of the curve has never been more important. CBA has an impressive line-up of programs this summer and fall to help our bankers be prepared for the next big thing. If your audience includes lenders, CFOs, compliance officers, senior management, credit analysts, IT professionals or security personnel, take a look at these upcoming programs: Cyber Risk Summit • Bank Security Conference • CFO Conference Training the Credit Analyst • Writing an Effective Credit Memo • Advanced Lending School Consumer & Commercial Loan Documentation Bootcamp • Commercial Lending School Analyzing Personal & Corporate Financial Statements & Tax Returns 2019 Compliance Conference: Emerging Risks • BSA Officer School – The Basics Annual Convention & Mini-Trade Show • Fall Clay Shoot

Target these audiences with customized sponsorships and consider advertising in CBA’s magazine, website, or popular e-newsletter–all offer maximum exposure for your company.

Don’t wait! Sponsorships are available on a first-come, first-served basis. For more information, contact Lindsay Greene at (770) 541-0376 or email lindsay@cbaofga. com.

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40 Remarkable Years – And Just Getting Started The Baker Group Celebrates 40 Years in Business

“The pace of change has quickened dramatically in the banking industry within the past few years. Economic conditions and the regulatory environment, for example, combined to increase significantly the challenges facing bank management. In addition, policies and procedures that had worked well for what seemed like an eternity were destroyed by events over which bank management had little or no control. Bank managements needed an approach that focused on the total bank; and that approach became known as asset/liability management.”

– Dr. James V. Baker, Jr. “Asset/Liability Management” 1981 The Baker Group – A Brief History At the end of the 1970s, the US banking industry faced enormous challenges as deregulation and an explosion of new financial products forced bankers to rethink the way they did business. At the same time, Federal Reserve Chairman Paul Volcker launched an unprecedented tight money campaign in order to fight inflation, which reached 13.3% in December of 1979. Suddenly, interest rate volatility soared and bank balance sheets were thrown into disarray. In the midst of this turmoil, the Baker Group (then James Baker & Company) began to help community bankers adapt to those changes through a new concept called “Asset/Liability Management.” Dr. James V. Baker’s best-selling book of the same name was published two years later by the American Bankers Association. The book became both the academic and industry standard for a new practice in interest rate risk management.

The concept of a “systems approach” to asset/liability management, which Dr. Baker pioneered, remained foreign to many bankers in the post-Volcker era and early years of the new firm. At the time, banks watched in horror as their short-term liability rates climbed to 15-20%, while their longterm assets locked in to single-digit rates. This unique drama begged for a system-wide solution to more effectively define, measure, and manage the interest rate risk positions of community banks for all environments. What seems common practice today was, in fact, revolutionary at the time, and early Baker clients who were there at the beginning had a front row seat to a historical shift in the industry.

In 1981 Baker released one of the first ever asset/liability software models designed specifically for community banks.

Its introduction to the industry helped the young firm grow rapidly. As the firm grew, Dr. Baker was constantly on the road, ever committed to educating banks about how to optimize their investment decisions within the context of a robust asset/liability management system. By the end of the 1980s, the Baker Group had secured its place as a top-tier provider 3 4 | ww w.cbaofga.co m | Summer 2019

of interest rate risk management solutions and investment services for community banks. It was this early success that propelled the firm into a new era of banking, and brought a new perspective to the investment management process.

Baker in the Next Forty Years In the subsequent four decades the Baker Group has grown, evolved, and continued to innovate as industry and market conditions have changed. The firm has focused intensely on serving its clients every step of the way. As their needs have changed, the Baker Group has responded – an instinct whose DNA has defined the firm and its culture from the beginning.

Baker’s success as a business has been built entirely from the relationships it’s forged and fostered over four decades of commitment to its clients. There is no doubt that while the coming decades will bring more change and challenges to clients and the industry, the Baker Group will continue to adapt, innovate, and serve.

The Baker Group will celebrate this year by highlighting brand-new initiatives and lines of business to help clients further improve and optimize performance. The firm has enhanced its trading capacity, introduced a new funding and CD underwriting program, opened offices in New York, and expanded its public finance footprint nationwide. Baker has engaged in strategic alliances that enable it to provide clients with expertise and resources for building long-term shareholder value. The education platform also continues to grow, offering even greater variety of programs and venues for workshops, conferences, and bond and balance sheet schools. These initiatives continue to lay critical groundwork for further success and growth in the decades to come. The Baker Group’s legacy, built on a foundation of integrity and service to so many financial institutions over the years, clearly has its best years ahead.

Jeffrey F. Caughron is a Managing Director with The Baker Group, where he serves as President and Chief Executive Officer. Contact: 800-937-2257, jcaughron@GoBaker.com.

Jeff Caughron Managing Director The Baker Group A CBA Endorsed Member Company

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BOLI: The Most Misunderstood Revenue Generator

Many banks, maybe even yours, have purchased Bank Owned Life Insurance (BOLI) that was specifically purchased in association with the implementation of new non-qualified executive and director supplemental retirement plans. The BOLI was typically purchased on the lives of the executives and or directors that were participants in the benefit plans and the concept was that the BOLI earnings ( less opportunity cost) was going to help offset the benefit plan expenses.

Although this strategy works well for banks looking to implement supplemental benefits to reward and retain key officers and or directors there is a misconception within the community bank marketplace that to purchase Bank Owned Life Insurance (BOLI) you need to implement new benefit plans. This thought process couldn’t be further from the truth, when in fact the Interagency Statement on the Purchase and Risk Management of Life Insurance states that BOLI can provide attractive tax-equivalent yields to help offset the rapidly rising cost of existing health, dental , group term life insurance and qualified plan contributions and doesn’t need to be associated with the implementation of new benefits.

BOLI can be a key component of profitability for a community bank. Smaller banks are typically less profitable than larger banks despite having higher net interest margins and interest rate spreads, and a higher percentage of earning assets/ assets than larger banks. This is because larger banks typically have more non-interest income than smaller banks. BOLI can provide an efficient source of noninterest income to improve profitability for smaller banks.

Banks need to analyze BOLI as another alternative asset that will help improve bottom line earnings. Due to the high credit quality of the various insurance companies, attractive tax free yields, BOLI continues to be a very attractive asset for banks. There is over $170 billion of BOLI today on banks’ balance sheets. As an example in today’s marketplace a $3.0 million BOLI policy on a 45-year-old male can: •

Provide a tax-free yield of approximately 3.5% (a tax equivalent yield of 4.69%).

•

Generate an additional $60,000 of earnings, assuming an opportunity cost of 1.5 % A/T.

•

Inside build-up of the policy’s cash value is recorded as “Other Non-Interest Income” and is nontaxable.

•

Death benefits received by the bank are nontaxable.

•

Cash surrender value is not a mark-to-market asset.

•

Provide additional life insurance coverage of over $6.0 Million. This additional coverage can be shared with an insured employee’s beneficiary upon the employee’s death (typically on a pre-retirement basis) and also provide the bank key person coverage, all at no additional expense to the bank.

•

When looking to design and implement a new BOLI purchase, the key considerations should include: •

Identifying the group of employees to be insured, understanding that they need to fall within the top 35% of salaried employees.

•

Determining which insurance companies are the best fit from the standpoint of credit ratings, past performance, investment philosophy, portfolio composition and yield (both short and long term).

•

Vendor selection.

•

BOLI administration platform.

When contemplating these questions, it is important to have a knowledgeable BOLI provider that can guide you through the implementation process. There are a lot of variables involved, but with the proper guidance and effort, a BOLI program can be created that will help the bank provide very meaningful earnings improvement and be compliant from a regulatory standpoint.

Hear more from John on this topic at the Saturday Dawn Breakers Session at CBA’s 51st Annual Convention & MiniTrade Show!

If you have any questions about how BOLI can improve your bank’s bottom line earnings, please contact John Gianacaci, Regional Managing Director, The BFS Group at jgianacaci@bfsgroup.com or (609) 915-9168.

John Gianacaci Southeastern Regional Managing Director BFS Group A CBA Endorsed Member Company

Cash surrender value is available upon request, with no surrender charge.

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 35

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DOES YOUR BANK HAVE A DREAM TEAM?

Assessing Your Bank’s Leadership Team is the Foundation of Successful Succession Planning

Many bank Boards of Directors and CEOs are proud of their bank’s executive team. And rightly so! Yet frequently those feelings of pride dissolve into uncertainty when the bank is faced with the decision to promote a banker into a top executive position or even the CEO role.

How does this happen? Why do well laid out succession plans sometimes evaporate in the face of reality when the time to elevate someone finally arrives? One of the reasons, based on our experience working with hundreds of community bank boards and executive teams, is that directors are often missing context when faced with a promotion decision. The lack of relative perspective on comparative candidates for similar roles may at times impede the comfort level necessary for a board to validate a promotion decision.

Succession plans are frequently aspirational in nature for community banks: long on good intentions towards the executive and bank, yet short on taking advantage of the time available to fully develop and groom worthy successors for key roles. In order for a bank board to gain the comfort to support a CEO’s recommendation for a C-Level executive promotion, or for the board to align around a promotional decision into the CEO role, a robust assessment, development and monitoring program needs to have taken place well along the way.

True clarity around the bank’s strategic plan and growth objectives is also critical. Alignment among the key decision makers—usually the Board of Directors or Trustees, along with the CEO—provides a consistent viewpoint on what the bank needs in its next leader. Strategy informs profile on many levels, including both tangible skills and leadership competencies, and collectively these must also mesh with the company and boardroom culture to enable a successful leadership transition.

Once a bank’s strategic direction is updated and affirmed, an appropriate next step is often to conduct a management assessment of the existing leadership team. At a minimum, this exercise should provide a developmental action plan to help elevate performance of the senior team—even when that performance is already solid. Evaluating the leadership team (this may involve more than one “level” of executives, depending on the institution’s size and complexity) provides multiple benefits, including: •

•

An objective evaluation of the strengths, scalability, areas of development and desire for more responsibility, particularly when conducted by an independent party.

Creation of a “road map of development” which can be taken to boost executive performance and enhance succession viability.

3 6 | ww w.cbaofga.co m | Summer 2019

•

Increased likelihood of retention of high potential bankers due to the feeling of being “valued” and “invested-in” by the organization.

•

Higher morale, as employees see the investment in future leaders as a sign of a commitment to growth and continued independence.

•

A lower risk of a sale of merger driven by a talent deficit, as good succession planning enhances the continuity of leadership and strategy.

A robust management assessment program should have several critical components: •

Input from the CEO and Board that aligns strategy and the desired/needed profiles of future leaders for key roles.

These profiles are often different than an incumbent’s profile.

•

Extensive in-person interview time with a qualified industry talent expert. This should involve both behavioral and chronological interviewing techniques.

•

Use of a third-party assessment tool to help grasp an executive’s full range of behaviors and leadership attributes, and the ability to benchmark against desired profiles.

•

A peer evaluation survey, to garner candid input from close colleagues. Such a 360° process can provide valuable insights to help guide developments plans.

There is no more important responsibility of an incumbent CEO and community bank board than to develop the strongest possible leadership team and potential CEO successor. An informed board with a strong range of perspectives on the bank’s executive talent is best positioned to make promotional decisions on future bank leaders and CEO succession. A robust management assessment program provides the right foundation for good governance and successful succession planning.

Hear more from Alan on this topic at CBA’s 51st Annual Convention & Mini-Trade Show!

Alan J. Kaplan is Founder & CEO of Kaplan Partners, a retained executive search and talent advisory firm headquartered in suburban Philadelphia. You can reach Alan at 610-642-5644 or alan@KaplanPartners.com.

Alan J. Kaplan Founder & CEO Kaplan Partners A CBA Endorsed Member Company

2019 Endorsed Member Companies ACG | Refurbished ATMs Phil Winn | Phil.Winn@acgworld.com | (678) 458-9899​

Kasasa | Branded Suite of Banking Products Shanna James | shanna.james@kasasa.com | (512) 582-7174

ATM Response | ATM Service & Cash Logistics Tony Webb | twebb@atmresponse.com | (770) 855-2989

Pentegra | 401k/Retirement Planning Wade Connor | wade.connor@pentegra.com | (704) 608-4563

Bahr Consultants, Inc. | Insurance Review Hank Bahr | hank@bahrconsultantsinc.com | (865) 694-6098

S&P Global Market Intelligence (Formerly SNL Financial) | Financial Data Colin Wyatt | Colin.Wyatt@spglobal.com | (434) 817-5475

BFS Group | BOLI & Executive Benefits John Gianacaci | JGianacaci@bfsgroup.com | (609) 915-9168

SecureWorks | Managed Internet Security Program Jack Clonts | jclonts@secureworks.com | (404) 417-3716

Computer Services, Inc. | Secure-Connect for Directors Andy Lapp | andy.lapp@csiweb.com | (800) 545-4274, ext. 16064

SHAZAM | Debit Card/EFT Processing Alex Jernigan | jjernig@Shazam.net | (229) 220-0064

CRA Partners | Senior Housing Crime Prevention Sue Shaffer | sue.shaffer@shcpfoundation.org (901) 529-4787

STS Group | Bank Security Equipment & Branch Automation Technology Chris Nelson | cnelson@stsgrp.com | (205) 567-3613

Crescent Mortgage | Secondary Market Mortgage Services Skip Willcox | swillcox@crescentmortgage.net (478) 357-4441 The Eversole Group, LLC | Marketing Program Craig Eversole | craig@theeversolegroup.com (601) 977-5225 Executive Insurance Agency, Inc. | VSI Program Ryan Sower | ryan@executiveinsuranceagency.com (770) 474-2355 FITECH | Merchant Services Matt Mingenback | mmingenback@fitech.com | (316) 518-8850

The Baker Group | Portfolio Management & Asset/Liability Strategies Paul Clanton | pclanton@gobaker.com | (405) 415-7337 Travelers | Insurance/D & O/ Bond Program Diana Baker | dcbaker@travelers.com | (678) 317-7882 William Mills Agency | Public Relations & Marketing William Mills | william@williammills.com | (678) 781-7200 Promontory Interfinancial Network, LLC Bank Assetpoint/Insured Cash Sweep (ICS) Danny Capitel | dcapitel@promnetwork.com | (770) 630-6796 *Cooperative Marketing Alliance

Genesys Technology Group, LLC | Vendor Renewal & Evaluation David Saylor | david@genesystg.com | (770) 729-4139 Harland Clarke | Check Program Ryan Busenitz | Ryan.Busenitz@harlandclarke.com | (678) 595-0625 Holtmeyer & Monson | SBA Lending Arne Monson | amonson@holtandmon.com | (800) 340-7304

For more information on these providers, special discounts for CBA member banks, or to learn about the endorsement process, contact Lindsay Greene at (770) 541-0376 or lindsay@cbaofga.com.

Su m m e r 2 0 1 9 | G e org i a Com m un i ti es F i rs t | 37

Presort Standard U.S. Postage Paid Alpharetta, GA Permit 864

1900 The Exchange, Suite 600 Atlanta, GA 30339 www.cbaofga.com