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KENTUCKY BANKER MAGAZINE June 2013

As we celebrate our 25th Anniversary, we express our sincere appreciation for the support and loyalty of our customers.

Our goal, like that of the Community Banks we serve, continues to be delivering the leading, strongest customer service in the correspondent banking industry. We look forward to the future and the continued opportunity to care for our customers.

800.248.3229 | 502.695.3000 | www.bbky.com

BOARD OFFICERS

David P. Heintzman KBA Chairman Stock Yards Bank & Trust Company Louisville Richard Barto KBA Vice Chairman Citizens Bank of Northern Kentucky Newport Neil S. Bryan KBA Treasurer The Farmer’s Mank of Milton Milton Tony D. Whitaker KBA Past Chairman First Federal Savings & Loan Association Hazard Ballard W. Cassady, Jr. KBA President & CEO GROUP REPRESENTATIVES R. Bruce Kimbell- Group 1 First Community Bank Clinton Michael Mercer- Group 2 First Security Bank of KY Central City Frank B. Wilson- Group 3 Wilson & Muir Bank & Trust Company Bardstown Owen Lambert- Group 4 South Central Bank Glasgow James W. Beach- Group 5 People’s Bank & Trust Company Owenton Anthony Busseni- Group 6 Century Bank of Kentucky Lawrenceburg Katherine Capps- Group 7 First State Financial Middlesboro Stephen Miller- Group 8 Peoples Bank of Kentucky Flemingsburg Greg A. Wilson- Group 9 The First Commonwealth Bank Prestonsburg THRIFT REPRESENTATIVES Don Jennings First Federal Savings Bank of Frankfort Frankfort Glenn Meyers Kentucky Federal Savings & Loan Covington BANK SIZE REPRESENTATIVES Luther Deaton Central Bank Lexington Elizabeth Griffin McCoy Planters Bank Hopkinsville EDUCATION ALLIANCE REPRESENTATIVE Lanie W. Gardner First National Bank of Muhlenberg County Central City PEC REPRESENTATIVE Fred Brashear, II Hyden Citizens Bank Hyden

CONTENTS STAFF MANAGEMENT TEAM Ballard W. Cassady, Jr. President & CEO Debra K. Stamper EVP/General Counsel/Director of Compliance Paula B. Cravens Sturgeon Director of Education Solutions Selina O. Parrish Director of Vendor Solutions Matthew E. Vance Chief Financial Officer STAFF Miriam Cole Executive Assistant Paula Cross Education Solutions Coordinator Kyle Elmore Director of Communications Jamie Hampton Education Solutions Coordinator Natalie Kaelin Assistant General Counsel Michelle Madison IT Manager Lanie Minton Administrative Assistant Tammy J. Nichols Convention & Member Services Coordinator Katie Rajchel Staff Accountant Yvonne Savage PAC Services Coordinator Steve Whitlow Systems Engineer CONSULTANTS John P. Cooper Governmental Affairs KBA Insurance Solutions Chuck Maggard President & CEO Brandon Maggard Account Representative Audrey Whitaker Insurance Services Coordinator KBA BENEFIT SOLUTIONS Lisa Mattingly Director Sales & Service Lane Hettich Service Manager HOPE OF KENTUCKY Billie Wade Executive Director

Cover

Barn & Tree Photo shot by Diane Alder for the 2013 Scenes of Kentucky Photo Contest

COLUMNS Chairman’s Corner.........................5 Straight Talk.................................6 My Two Cents Plus Some...............8

DEPARTMENTS Education....................................17 Products and Services..................21 Making News...............................22 On the Move................................25

FEATURES Davis Retirement...........................7 Emerging Leader Spotlight............10 Sprague Resolution......................11 One on One Update.....................12 Group Meetings Recap.................14 Elliott Resolution..........................16 Haiti Relief Effort..........................19 Johnson Resolution.......................27 June 2013 | 3

Jim McKenzie

Correspondent Banking

Count on us.

In today’s environment, Correspondent relationships are more important than ever and Stock Yards Bank & Trust is committed to working with the community banks in Kentucky. As one of the largest and strongest Kentucky based community banks, we understand the complex issues your bank is facing today. When your bank has needs around capital, liquidity, acquisition financing, stock buy backs, retirement plans or trust services we want to be your bank’s trusted Correspondent partner.

Chances are we know you, your bank and your community. Give James or Jim a call and put our experienced team to work for your bank.

James Brown

Correspondent Banking

The Correspondent Banking Team Jim McKenzie has over 40 years of banking experience, 36 years of those years as a correspondent banker.

James Brown has over 20 years of banking experience in Retail, Small Business, Corporate and Correspondent Banking.

(502) 625-0878 jim.mckenzie@syb.com

(502) 625-9330 james.brown@syb.com

Lending Services Holding Company Shareholder Groups Bank Credit Needs And More!

Deposit Services Fed Fund Sweeps Wire Transfer Automated Clearing House And More!

International Services Foreign Exchange (CHECKS & WIRES) Letters of Credit And more!

www.syb.com

Stock Yards Trust Company Services Retirement Plans Investment Management Insurance Trust Partnering And More!

NOT FDIC INSURED MAY LOSE VALUE NO BANK GUARANTEE

CHAIRMAN’S CORNER go through your records, each currently working individual that is nominated will have their name entered for a drawing to attend dinner in their honor on Saturday night and a complimentary two night stay at the Greenbrier. Remember, this club is for people serving the banking industry for over 50 years which may or may not be all with the same bank. Thank you for your attention to this. I hope we have many new members this year.

David Heintzman KBA Chairman

When a banker signs on, so to speak, to be Chairman of the KBA, they are forewarned about the month of May and time consuming group meetings around the state. Having recently finished my eighth and final meeting, I am here to say I enjoyed it immensely. I was the fortunate one who got to leave the big city and see banking at its finest, in the small towns and communities across Kentucky.

As I drove to each group meeting, I saw signs for or drove through towns where I had met bankers but never knew where their town was located.

As I visited with bankers at the group meetings, I was able to listen to and empathize over their plights and concerns, many of which I don’t face in my sterile environment. Bankers throughout our great state are very diverse, but let’s celebrate our similarities rather than our differences. We know bankers are critical to their communities’ vibrancy, through both lending activities and through time, talent and treasures of bankers as they support community projects. We make our communities better! Keep up the good fight!

Lastly, in April, Stock Yards bid farewell to longtime director and former Chairman and CEO, David Brooks, due to our mandatory retirement at age 70. David was also Chairman of KBA in 1997.

David started with the Bank in 1971 and served on the Board since 1985. David was Chairman and CEO from 1993 until his retirement in 2004, overseeing our growth in earnings and assets from $237 million in assets and $2.0 million net income in 1993 to $1.2 billion in assets and $19 million in net income in 2004. April also marked an 81 year era of Brooks family service to Stock Yards Bank.

Yes, 81 years. Starting with David’s grandfather, Charles W. Brooks, who was a Board member from 1933-1961, to David’s father, Willet D. Brooks, who served as a Board member from 1951-1979, to David who served the Bank since 1971. Stock Yards’ ownership is very widespread and having one family in leadership roles for over 80 years is a true testament to the quality of this family. David hired me and for that I am ever grateful. Thank you David. All Kentucky banks have similar stories of great people who have devoted careers to our great industry. Let’s keep working together to keep it great.

On a separate note, every year at the convention, the KBA has a dinner to recognize employees and directors of our banks that have served the banking industry for over 50 years. The KBA will send notices to banks asking you to scroll your employee base for possible members of the Fifty Year Club. Please take time and see if any of your employees or directors qualify. As an incentive to June 2013 | 5

STRAIGHT TALK

Never Street instead of Wall Street. I urge you to send a letter or email to one of our Congressmen, suggesting they cosponsor the legislation.

How often do you hear a politician say, “I was wrong?”

Exactly what I thought….never.

I hear a lot of political backtracking and reasoning for consequential decisions, but never a flat out takeresponsibility. “I’m the one to blame” declaration. Probably the most notable faux pas in my life time was when the Congress RETROACTIVELY changed the tax laws in ‘86. This is directly linked by historians to the cause of the economic downturn and S&L debacle of the 80’s. Never in the history of Congress had they made tax changes retroactive. It broke millions of small investors and nearly destroyed the S& L industry. In the meantime they gave each other accolades for their foresightedness. UGH! Like you, I am held accountable for my job. If I make a mistake, there are consequences. It’s obvious our legislators understand the unintended consequences of aggressive community bank regulation, particularly from Dodd-Frank. Our industry’s voice has been heard and the House’s attempt to “fix” these unintended consequences emerges in the form of the Community Lending Enhancement and Regulatory Relief Act (H.R. 1750). This act would ease some of the regulatory burden on community banks. This is as close as we have come to a political apology from those working in our best interest.

I often make light of the situation to keep myself (and my associates) sane, but this is genuinely a step in the right direction. We must be on the same page when it comes to economic recovery and the provisions of this bill are common sense, straightforward answers to redundant and costly regulations that stifle community banking. Please promote this grass roots act and build opportunity on Main

The Relief Act aims to enhance the ability of community financial institutions to foster economic growth and serve their communities, boost small businesses, and increase individual savings. To accomplish these goals, the legislation would expand the Qualified Mortgage safe harbor to include loans originated and retained in portfolio for a period of at least three years by a creditor having less than $10 billion in total assets, including balloon loans.

These changes would ensure that the safe harbor strikes the right balance by protecting consumers from poorly underwritten mortgages while ensuring they have access to safe and affordable mortgage products. Furthermore, this legislation provides an exemption from the GrammLeach-Bliley Act’s annual notice requirement for institutions that have not changed their privacy policies and only share personal information within the statutory exceptions. This would result in significant savings in mailing costs for banks across the country, not only those in the Commonwealth.

I understand we need to bolster the USPS, but let’s find other ways to keep that service alive and kicking.

Additionally, H.R. 1750 would amend Section 404 of the Sarbanes-Oxley Act to provide that management attestation requirements do not apply to any insured depository institution with total consolidated assets of $10 billion or less. While the Act placed some important new financial reporting requirements on public companies, Section 404 continues to impose a disproportionately negative cost burden on smaller public companies. In fact, a 2009 SEC study found that Section 404 costs companies an average of $2.3 million every year in direct compliance costs, and that the long-term cost burden on smaller companies is more than seven times greater than those imposed on larger firms. The bill would also require the Securities and Exchange Commission (SEC) to conduct an analysis of the costs and benefits, including economic benefits, of any new or amended accounting principle. Benefits to investors would have to outweigh costs before the SEC could recognize the principle. The bill would ensure that the best possible assessment is made of new accounting principles so that regulated entities are not subject to unnecessary costs that outweigh any potential regulatory benefit.

Please voice your support to our Congressmen. We are far from solid solutions, but this is a promising start.

Let me know what you think: bcassady@kybanks.com June 2013 | 6

Roger W. Davis Retires From Community Trust Bank

Community Trust Bank recently honored Roger W. Davis upon the occasion of his retirement after 21 years of dedicated service.

Mark A. Gooch, President and CEO of Community Trust Bank, announced that Roger W. Davis, Vice President and Special Assets Officer at the Main Office in Pikeville, Kentucky, has retired from Community Trust Bank after 21 years of dedicated service. As Special Assets Officer, Roger managed problem commercial credits and large commercial customer bankruptcies. He also managed the continuing review of problem commercial credits throughout the bank’s market areas. Roger provided management reports on problem commercial credits and assisted in the management of the bank’s OREO (Other Real Estate Owned) portfolio and loan loss reserve. story continues on page 24

June 2013 | 7

MY TWO CENTS PLUS SOME

I Can’t Focus When Things Get Like This…

DESTRUCTION practices?; and, Are employees held accountable for their role in the compliance? When considering record retention, as an overall concept, there are three very specific time frames that you have to keep in mind: 1. How long you are legally required to maintain certain records by law or regulation; 2. How long your bank policy requires you to maintain documents; 3. How long you actually maintain the documents.

Usually, my article for the magazine is a breeze. I enjoy writing and always have an opinion on some issue or another. This is not just a professional attitude—this is pretty much how I live my life. I enjoy blogging and giving my opinion on all sorts of things, movies, restaurants etc. So, when I find myself at a loss for topics or words, it is unusual.

When I can’t focus on one issue, I try to figure out why and it is usually because too many unrelated issues are playing in my head. They are cluttering up the works, leaving me with little guidance on priority.

This may be like your record retention practices. DO you just keep every document for ever because you are afraid that you will destroy it too soon or because you have started to keep documents digitally and you have plenty of virtual storage space? A few questions you should ask yourself right now are: Do we have a record retention policy?; Does everyone know what it is and how it applies to them?; is it followed in retention and, as importantly, June 2013 | 8

These are very distinct considerations. I will start with the last one first.

It doesn’t matter what the law, the regulations or your policy says, if you still have a document, whether in paper or digital form, it is subject to discovery and production in many cases. If ordered by a court or by a governmental agency with proper jurisdiction, you may have to produce documents regardless of how old they are. Therefore, it is absolutely necessary that your staff follows the destruction portion of the record retention policy as carefully as the retention portion. It is human nature to worry that you will need something as soon as you throw it out. But, that is a luxury that we cannot afford in banking. In most cases, documents requested after any required retention period are only requested as part of some action that is potentially detrimental to the bank. This is true whether it is a loan file, board notes or employee reviews. You may not refuse a document demand (if otherwise enforceable) by indicating that your bank is not required

to maintain the documents. Unless you are certain that your destruction policy is followed as carefully as your retention policy, you are required to investigate to see if you have the requested documents. This process is further simplified by ensuring that you only retain the documents that are necessary under the law/policy and not extrinsic documents unnecessary to substantiate the underlying transaction. For instance, tape recordings of board meetings should be destroyed/erased as soon as the minutes from that meeting are officially approved. The board minutes are the official record of the action of the board. Recordings often contain ancillary information that is not relevant, and perhaps inflammatory to the issue under consideration.

This takes me to the next issue of what your policy requires. It doesn’t matter what the law or the regulations provide, if your policy is more restrictive, that is what binds you.

I often get calls from banks asking what is required by a particular regulation or law. I always start by asking them in return what their internal policies require on the same issue. Then I compare the policy to legal requirements and explain that the most restrictive applies. So, if a law requires you to maintain a document for 5 years, but your internal policy requires you to maintain the same document for 10 years, you are subject to producing that document in response to a court order or proper governmental agency request for the policy period of 10 years. Additionally, you can be cited by examiners for failing to comply with your own policy, even if you are in compliance with legal requirements. This makes it increasingly important that your internal policy for document re-

tention and destruction is up to date and, ideally, no more restrictive than the law.

Which takes me to the final time frame to consider—that is, what does the law require and how do you figure out if you have accurate time frames for all documents. The statutory and regulatory requirements for document retention are difficult to locate.

Not only do you have to worry about federal law, but you also have to worry about regulations, guidelines and state law requirements of potentially every state that you do business in.

You can find original sources through statutes and regulations, but finding them all is a real challenge.

The best practice for preparing your record retention policy in a compliant manner is to utilize the services of a professional company that tracks record retention. But, as with every

other vendor that you do business with, you have to be satisfied that the service/information that they provide to you is the best information available. For years the KBA had offered a record retention manual that provided sample policies and offered the maximum record retention period required by any federal or state law.

Utilization of this manual ensured that your bank had the requirements of all states and federal law covered.

However, we recently found that the primary editor is retiring and that this manual will no longer be updated.

ginning your record retention policy.

Once you have created your own record retention and destruction policy, you can then update it only as new record retention policies are included in newly published or released laws and regulations.

One thing to take away from this article—destruction is as important as retention!

Debra Stamper dstamper@kybanks.com

The Kentucky Department of Financial Institutions has not updated their record retention schedule since 2006 and it does not include other states or necessarily track federal requirements. We have found a new provider, Quick Notes. Utilizing Quick Notes along with the DFI’s schedule gives you a good foundation for be-

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Emerging Leader Spotlight: Jason Jones Debra Stamper then took the floor and brought everyone up to speed on federal and state legislation activities thus far in 2013. They shared with the group several federal and state bills that were in discussion and the position of the KBA was given and explained.

A review of the recently completed Kentucky General Assembly was also given. They urged us to reach out to our representatives in Frankfort and Washington to let them know where we stand on the pending issues that are currently being discussed.

The meeting then continued with discussion about the importance of participating in the PAC program and a brief overview of why the PAC is so important. Local bankers were recognized for completing their 2012 PAC goals and awards were given to several banks.

In business our group then elected a new KBA board member, Tommy J. Smith, III, CEO of American Bank & Trust in Bowling Green to serve for the next three years.

My journey as part of the KBA Emerging Leaders program continued this month in a slightly different fashion. Our previous adventures had all been experienced as a collective group, but this month, they sent each of us out to our own regions of the state to participate in our KBA Group Meetings.

The days events closed with a great meal and for large portion of us a feeble attempt at a round of golf. The opportunities for information, education and support from the KBA are endless and the collective voice they have established is strong and effective. The Group 4 meeting was a great success and a reminder of what makes the KBA such a great organization.

And for me personally it was yet another great chapter in my KBA Emerging Leader journey!

As a proud member of Group 4, we met at the Bowling Green Country Club. I have been fortunate enough in my banking career to have met a lot of fellow bankers in our area but this was my first KBA group meeting.

One of the great things about being a community banker from Kentucky, is that gatherings such as this one always start with a meet and greet portion at which time you can re-connect with friends in the industry. In fact, it is almost like a reunion of sorts as everyone in our area is related, a former coworker, or has kids that go to school together and play sports together. There is a real sense of camaraderie amongst our group of bankers. We compete hard against each other when the opportunity arises but we also step back and help each other when needed. Relationships like that make the meet and greet portion of these events enjoyable and entertaining!

After we all had an opportunity to catch up, the program kicked off with a market report and economic forecast. Evidently the guest presenters thought we were having too much fun and that our day was going entirely too well because they quickly brought us back down to reality. They did an excellent job of laying out the state of affairs from an economic perspective.

Our economic outlook still has lots of questions and concerns in regards to our national debt, interest rates and unemployment. As community banks, we all are seeing the effects of these uncertainties with decreased loan demand, increasing deposit balances, and shrinking margins.

KBA representatives Ballard Cassady, John Cooper and

Our team collaborates with yours to ensure less disruption and constant communication regarding the audit status. After all, bank audit and tax work require a little more effort than counting with an abacus.

Bowling Green Russellville (270) 782-0700 (270) 726-7151 CRIcpa.com | blog.cricpa.com INTERNAL AUDIT | EXTERNAL AUDIT | TAX | REGULATORY COMPLIANCE | LOAN REVIEW | IT SERVICES

Who is Going One on One? Planters Bank

(photo to left) Planter’s Bank employee Elizabeth McCoy presents a check to University Heights Academy’s Kindergarten teacher, Ms. Robin Davis. This donation will go towards 2013 classroom supplies.

Bank of McCreary County

(above) Bank of McCreary County’s Gordon Kidd presenting on the Kentucky banking industry to the McCreary County Chamber of Commerce.

Taylor County Bank (photo to left) Taylor County Bank employee Misha Buck presents a check to Marietta Moyers with the Taylor County Food Pantry. TCB participated in the One on One Program sponsored by KBA. The bank received money from KBA to help with postage expense for the Military Care Package Program and continued the generosity with a donation to the Food Pantry.

June 2013 | 12

Louisa Community Bank Sharing the Industry’s The staff set a great One on One example, highlighting how Kentucky bankers make their communities better for two and four legged friends. A board member of the local Humane Society wrote a letter to the editor of the Big Sandy News recognizing the impact Louisa Community Bank employees have on the Lawrence County animal shelter. In return, the bank received money from the One on One campaign to continue the good work. It’s great to see our fellow bankers receive notariety for their outstanding work.

Commitment to Community

$25,000 to Charity

Win-Win Photo reprinted with permission of Big Sandy News

The KBA’s “One on One With My Community” initiative is focused on sharing the The KBA’s “One on One With My Community” initiative is focused on Kentucky banking industry’s commitment to community across the state. Each time sharing theorKentucky banking community that a bank banker goes “Oneindustry’s on One” commitment to share thistomessage with across their loKentucky.

Each time that a bank or banker goes “One on One” to share cal community, the KBA will donate $100 to a local charity of that bank’s choice.

Help share the truth about industry with and support this us message with their localourcommunity, theour KBAneighbors will donate $50 to local a charities in the process. sure choice. to check Help back for going about One onour One. local charity of thatMake bank’s us more sharebanks the truth

industry with our neighbors and support local charities in the process.

June 2013 | 13

2013 Group Meetings Was there ever a bad day that involved golf? Not likely. Which is why our group meetings prove to be the perfect blend of business and pleasure. Thank you to all the bankers who attended.

June 2013 | 14

PAC Awards Winners

A few of the many outstanding bankers who contributed to KBPAC this year. Thank you for your continued support.

Pictured clockwise from top left Paducah, Prestonsburg, Bowling Green, Central City, Central City (group picture), London, and Lexington. We hope to see a great turn out at the KBPAC Golf Extravaganza in Bowling Green, August 12th, 2013. Registration information is available on the KBA website or contact Yvonne Savage at ysavage@kybanks.com (502) 736-1267.

June 2013 | 15

Certified Teller Seminar New CTR/SAR Reporting Update 6 – 8:30 pm, $59 per person

Register Early! Space is limited at some locations! Register online at www.kybanks.com!

The mandatory compliance deadline of March 31, 2013 has come and gone. By now, all financial institutions are using and electronically filing the new Currency Transaction Report (FinCEN Form 112 “BSA-CTR”) and the new Suspicious Activity Report (FinCEN Form 111 “BSA-SAR”).

When is a form not a form? These new electronic data collection devices contain new data fields that can result in confusion,

frustration, errors and time spent making corrections. Now more than ever, completing the new CTR and SAR process is more than filling out a form.

One of the BSA requirements is that all frontline employees be annually trained on money laundering, currency and funds transfers and suspicious activity. Yet, recently-cited BSA violations include: inadequate or lack of job specific training, failure to accurately complete Currency Transactions Reports (CTR) and failure to identify suspicious activity.

This fast-paced, information-packed evening seminar is full of “Must-Knows” and is designed to provide the annual BSA training as well as an update refresher of the new CTR/SAR reporting.

Seminar Topics  

Update of BSA Hot Topics and “Must-Knows” The Importance and Details of the New Forms 112 and 111

 

New Deadlines for Reporting Action Planning and Take-Aways

The KBA Certified Teller program is now an annual training seminar. Everyone who attends the KBA Certified Teller Seminar will be awarded a teller certificate to recognize the importance of continuing education.

Speaker

Dianne Barton is President of Performance Solutions, Inc., (PSI), training and consulting company that specializes in providing “real world” solutions to the key challenges facing banks today in attracting and building relationships with their customers.

Her wide-range of training and consulting experience includes regulatory compliance, strategic planning facilitation, leadership development, and service and sales development. Before starting Performance Solutions in 1983, she held senior positions with Bank South Corporation, the Internal Revenue Service, and the John H. Harland Company. Dianne is a graduate of Georgia State University and is on the faculty of several state banking schools.

2012 Certified Teller Seminar Registration Form - - - - - - - - - - - - - - Use one form per person, copy as needed. - - - - - - - - - - - PDF

MARK ONE:

 July 8 Elizabethtown  July 15 Paducah  July 24 Somerset

 July 9 Carrollton  July 16 Marion  July 25 London

 July 10 Grayson  July 17 Owensboro

 July 11 Prestonsburg  July 18 Bowling Green

Name ______________________________________________________________________ Title _____________________________________________________________ Bank Name _____________________________________________________________________________________________________________________________________ Address _________________________________________________________________ Telephone ___________________________________________________

City, State and Zip _____________________________________________________

Email __________________________________________________________________________

CHECK ONE: Check enclosed_______________________________________

Send invoice

Pay with Credit Card type and # _________________________________________________________________________ Exp date ______

Three digit sec code ______

Mail or Fax (502‐584‐6390)

Completed form to Kentucky Bankers Association, 600 West Main Street, Suite 400, Louisville, KY 40202.

June 2013 | 17

Diebold’s deposit automation. The more you put into your ATMs, the more your customers put into them.

With Diebold’s deposit automation, Laconia Savings Bank dramatically increased deposits, customer satisfaction and processing efficiency. In fact, throughout implementation, deposits increased well over 100%. It’s another advancement toward optimum ATM productivity. And another reason why Diebold has remained a leader for more than 150 years.

For the entire story, visit www.diebold.com/boldinnovation.

1.800.806.6827 www.diebold.com requests@diebold.com

Haiti Relief Effort

It’s easy to lose focus in life and feel overwhelmed with the negatives.

Constant bills, schedules, remembering to send birthday cards, the everyday jumble that steals our focus and, at times, runs us ragged. Luckily, moments come along when you can exchange thoughts with someone who has perspective. First Security Bank’s Senior Vice President, Chris Dennis, is such a person. Dennis discusses his recent trip to the Bon Repo Orphanage in Haiti. The young man pictured at left appreciated his KBA cap, a gift from Dennis. This appreciation for small items and acts of kindness really stuck with Dennis. It motivates him to keep perspective in his life and continue working to brighten the lives of others.

LH: Why were you visiting Haiti?

CD: I am the Youth Pastor at First Baptist Church in Greenville KY. Our mission team traveled to Haiti on Spring Break. This is my second trip to Haiti.

We partnered with SMI Ministries Inc to minister to the people of Haiti. We invested two days at an orphanage in Bon Repo.

LH: Why did you take clothing with you to give out?

CD: After our first trip to Haiti in November 2012, we saw the desperate need for food, water and clothing. We were able to go to Haiti prepared to provide all three needs. One of our local boy scouts collected old/used hats for his eagle scout project. He learned of our trip to Haiti and we were able to take these items to the children of Bon Repo.

LH: The best part of your trip?

CD: The best part of the trip was seeing the humble and thankful responses of the people of Haiti. Yes, they live in poverty.

They are fortunate to make $1 per day, however, they are so thankful and content. They pray for food and water. We can not grasp the concept of praying for food. Our intent was to go and help the people of Haiti. When we returned, we felt that they helped us more than we helped them.

If you are interested in learning more about the orphanage in Bon Repo, Haiti contact Chris Dennis. The orphanage is newly established and constantly finds need for resources to feed, clothe, and build new facilities for the fifty displaced children living on site.

Contact Chris Dennis at cdennis@fsbky.com if you wish to discuss how you can help.

“That best portion of a good man's life: His little, nameless, unremembered acts of kindness and of love.” William Wordsworth (1770-1850) June 2013 | 19

PRODUCTS AND SERVICES

Stay in Compliance with Residential Appraisal Services To assist you with the compliance and regulatory requirements, KBA has expanded our endorsement relationship with Southwest Financial Services, Ltd. (SFS) to provide residential appraisal management solutions. SFS residential appraisal management process is flexible and can be set up to meet the unique needs of your bank.

Over the past 25 years, Southwest Financial has developed a proprietary appraisal management system designed to guarantee accuracy and efficiency. They offer a full line of residential appraisal services with a comprehensive online management solution, allowing you to control all of your residential appraisal interests.

Benefits/Features you will enjoy include: •Approved Appraiser Panel – SFS understands and appreciates the value of your relationships with your approved appraisers; they will work to utilize your network exclusively.

•Access to network of Appraisers outside your market area – SFS has a national network of experienced appraisers ready to assist in any market outside your traditional market area.

•Enjoy controlled costs for appraisal services –To comply with Dodd-Frank, Southwest will work in partnership with you to determine reasonable and customary appraiser fees for your market and then apply a “cost-plus” pricing model.

•Each appraisal processed through Southwest will undergo a comprehensive review to ensure completeness and compliance: appraisal complies with USPAP; appraisal meets federal standards and requirements; and, appraisal meets lenders unique requirements.

•Quick and easy to use online ordering; convenient transparency – Place order, upload documents, view status, submit inquiries, and view appraisal images right at your desktop.

Please contact Selina Parrish at the KBA (502) 736-1282 sparrish@kybanks.com or Nina Bedel at Southwest Financial Services at (800) 733-3312 Ext. 136 nina.bedel@sfsltd.com to discuss how Southwest’s residential appraisal management services can keep you in compliance.

June 2013 | 21

MAKING NEWS

Stock Yards Bancorp to present at the 2013 Hilliard Lyons INVESTKentucky Conference LOUISVILLE, Ky. – S.Y. Bancorp, Inc. (NASDAQ: SYBT), parent company of Stock Yards Bank & Trust Company, with offices in the Louisville, Indianapolis and Cincinnati metropolitan markets, today announced that its management will participate in the 2013 Hilliard Lyons INVESTKentucky Conference, which takes place at Churchill Downs in Louisville on June 6. James A. (Ja) Hillebrand, President, and T. Clay Stinnett, Chief Strategic Officer, will represent the Company at the conference.

The investor presentation by S.Y. Bancorp is scheduled to begin at 10:05 a.m. E.T. and management's remarks will be available to investors via a live webcast.

The Company's slide presentation will be posted to the investor section of the Company's website, www.syb.com, prior to the event, along with a link to the audio webcast, which will be available for replay for a period of 60 days.

Louisville, Kentucky-based S.Y. Bancorp, Inc., with more than $2.12 billion in assets, was incorporated in 1988 as a bank holding company. It is the parent company of Stock Yards Bank & Trust Company, which was established in 1904. The Company's common shares trade on the NASDAQ Global Select Market under the symbol SYBT.

New President Continues Owingsville Banking Company’s Local Legacy Owingsville Banking Company, founded in 1893 and headquartered in Owingsville, KY, recently welcomed Carson F. Richards as its fifth President. “It’s quite humbling to be a part of this history. The bank has been around for so long, and it has operated, since it opened, in such an historic place [The Owings House],” said Richards. Richards has served on the bank’s Board of Directors for seven years.

Earlier this year, J.M. Richards stepped down as President of the institution after 34 years. “I’ve seen so many changes at the bank and in the banking industry since I started there. It is truly amazing. And by the way, this is not retirement,” says Richards. “I’ll still be up at the bank every day; except when I’m not.” Richards will remain Chairman of the Board at the bank.

Founded in 1893 by father and son Joseph Howe Richart and James Morrow Richart, as well as several other Bath County citizens, the bank has remained under the leadership of the Richards family for 120 years.

Ms. Richards is a North Carolina native but has lived in Central Kentucky for almost 40 years. “You know, it’s hard to believe that I’ve lived in Kentucky longer than I have anywhere else,” said Richards. She went on to say “I am excited for the opportunity to continue the bank’s tradition of customer service and community oriented thinking.”

Owingsville Banking Company remains an independent financial institution dedicated to serving the financial needs of Bath County. For more information about the company, visit www.BankOBC.com or call 606-674-6317.

Peoples Exchange Bank Advisory Board The Advisory Board of Directors of Peoples Exchange Bank recently announced that David Roberts, James (Jimmy) Richardson, and John Lankford have joined the Georgetown advisory board.

David Roberts has been a banker in the Scott County community since 1978. Roberts has served as President of First National Bank, President and CEO of Citizens Bank and as the Regional President of Town & Country Bank and Trust Co., in Georgetown. He is a current member of the Georgetown Scott County Chamber June 2013 | 22

of Commerce and has been active in the Scott County Board of Education Co-op Program, Scott County YMCA, past Chairman and Current Director of Scott County United, Georgetown Kiwanis, Georgetown Scotty County Tourism Commission, Georgetown Business Park Authority and the Georgetown Municipal Water and Sewer Service.

James (Jimmy) Richardson is a retired Field Superintendent with 38 years of service with Kentucky Utilities Company. Richardson has served as Commissioner for

Scott County/Georgetown Planning and Zoning and currently is a Representative for the Scott County Conservation District. He currently serves as President of Farm Bureau 2013.

John Lankford is an attorney with the private law practice of Lankford & Lankford. He has served as the Administrative Law Judge and Hearing Official for the Cabinet for Health Services. Lankford & Lankford has been nominated as the Georgetown News Graphic Readers’ Choice Best Law Firm.

“These three are highly respected and active throughout the community. We’re happy to have them join the board as we continue moving forward with our growth plan,” said Les Jarvis, Market President for Peoples Ex-

change Bank. “We are confident the combination of their experience will be a tremendous addition to our Advisory Board.”

In addition to Roberts, Richardson and Lankford, the other local Advisory Board members include Jim Bevins, Brad Green and Michael Raymond.

Founded in 1912, Peoples Exchange Bank serves Scott, Fayette, Woodford, Clark, Madison, Laurel, Montgomery, Powell and Lee Counties. The bank offers a wide range of banking and financial products including services to individuals, businesses and organizations. Peoples Exchange Bank is an equal housing lender, and member of the FDIC. For more information visit www.pebank.com, or call (800) 364-3631.

Community Trust Bancorp, Inc.’s Jean R. Hale Receives the “Martha Layne Collins Leadership Award” Presented by Women Leading Kentucky Tennessee, and West Virginia, with whom I am so proud to work.”

Jean R. Hale, Chairman, President, and CEO of Community Trust Bancorp, Inc. (NASDAQ: CTBI), was honored by Women Leading Kentucky who presented her with the “Martha Layne Collins Leadership Award” at their 14th Annual Women’s Business & Leadership Conference held in Lexington, Kentucky on May 2, 2013.

"I am honored to have received this recognition from Women Leading Kentucky,” said Ms. Hale. The success of any company is not in just having a business plan, but the successful execution of that plan. That is made possible by the dedicated efforts of the more than 1,000 employees of Community Trust in Kentucky,

Ms. Hale assumed her current position as President and CEO of Community Trust Bancorp, Inc. in 1999 and added the position of Chairman of the Board in 2005. She is also the Chairman of the Board of the Corporation's two subsidiaries, Community Trust Bank, Inc. and Community Trust and Investment Company. Ms. Hale is very active in economic development and education initiatives. Currently, Ms. Hale is Chairman of the Kentucky Economic Development and Finance Authority Board, a member of the Kentucky Economic Development Partnership Board and serves on the boards of Commonwealth Seed Capital, ARH Foundation and the University of Pikeville. In 2012 Ms. Hale was recognized by American Banker magazine as one of the nation’s “25 Most Powerful Women in Banking.” A native of Pike County, Kentucky, Ms. Hale is a graduate of the University of Pikeville and the Stonier Graduate School of Banking. Ms. Hale lives in

Pikeville and has a son, daughter-inlaw and two granddaughters residing in Nashville, Tennessee.

Women Leading Kentucky is a statewide network of outstanding business professionals who help women grow and prosper, personally and professionally. Women Leading Kentucky attend roundtables and the annual Women’s Business & Leadership Conference, contribute to scholarships supporting educational pursuits of women, join young professionals as an ambassador, and mentor young professionals.

Community Trust Bancorp, Inc., with assets of $3.7 billion, is headquartered in Pikeville, Kentucky and has 71 banking locations across eastern, northeastern, central, and south central Kentucky, six banking locations in southern West Virginia, four banking locations in Tennessee, four trust offices across Kentucky, and one trust office in Tennessee.

June 2013 | 23

Davis Retires After 21 Years of Service story continued from page 7

Prior to his most recent position of Special Assets Officer at Community Trust, Roger was a Senior Commercial Lender and Chief Credit Administrator.

He graduated from the University of Cincinnati in Cincinnati, Ohio with a Bachelor’s degree in Industrial Management.

Roger then went on to earn a Master’s in Business Administration (MBA) from Kent State University in Kent, Ohio.

Roger served in the United States Air Force as a Contracting Captain at Offutt Air Force Base in Omaha, Nebraska. He then went to work in the banking industry as a Credit Analyst, Senior Lending Officer, Commercial Mortgage Lender, and as a Commercial Mortgage Operations Officer. He was a member of the Risk Management Association (RMA), a national organization of bank credit officers where he served on a national committee to develop an environmental liability policy for commercial banks. Roger also served as instructor for several American Institution of Banking courses for banking officers and employees.

Roger Davis is an active member of the Pikeville Kiwanis Club where he currently serves as Club Secretary; Roger also held the position of Club President and was a Kiwanis District Lt. Governor.

Roger notes that his most rewarding experience while at Community Trust was “working with the bank’s dedicated staff to enable local businesses to grow and prosper with the help of our loans and other banking services.”

“We value each and every one of our more than 1,000 employees and the contributions they make to their communities each and every day,” said Mark Gooch. “We appreciate Roger’s service to our company, as well as his service to our country as a military veteran. We wish Roger and his family the very best in the years ahead.”

If you would like to submit to the Kentucky Banker Magazine, please contact: Lane Hettich lhettich@kybanks.com

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ON THE MOVE

Becky Arnold

Lisa Smith

(Not Pictured) Mark A. Gooch, President and CEO of Community Trust Bank, is pleased to announce that Pamela J. King, Community Trust Bank Credit Analyst III, has been promoted to the position of Assistant Vice President. As a credit analyst, Pamela’s responsibilities include advanced analysis of commercial loans.

Pamela King has been with Community Trust Bank for more than 10 years.

Pamela is a graduate of Clay County High School in Manchester, Kentucky, has attended Somerset Community College, and is a graduate of Omega Performance in Charlotte, North Carolina.

She has earned numerous hours of commercial credit training through the Risk Management Association (RMA), New Horizons Financial Group, and the American Bankers Association (ABA). Pamela resides in Harold, Kentucky.

Traditional Bank is proud to announce the promotions of Becky Arnold and Lisa Smith.

Arnold was promoted from Loan Assistant to Consumer Lender for the Paris Banking Center. Arnold will help Traditional Bank serve the personal lending needs of Paris and Bourbon County. Arnold is a native of Carlisle, Kentucky. She has lived in Paris since 1992, and has worked for Traditional

Kathy Jones

Jon Lutgring

Dale Cinnamon

Nikki Warford

Bank since 2005. Arnold is an active member of the local community and serves as secretary of the board for the Stoner Creek Country Club.

financial controls for the Bank. Jon holds a Bachelor’s degree in Finance and Master’s degree in Accounting from Indiana University.

Lisa Smith was promoted from Loan Assistant to Consumer Lender for the bank’s Short Street Banking Center in downtown Lexington. Smith has worked in banking for over 14 years. She is a native of Nicholasville, Kentucky and began working for Traditional Bank in 2011. Smith is a member of Southland Christian Church and serves as a volunteer for Visually Impaired Preschool Services (VIPS).

Dale Cinnamon recently joined Farmers National Bank as Vice President, Mercer County Market Manager.

He has over 30 years of lending experience and is a lifelong resident of Mercer County. Cinnamon is a graduate of the University of Kentucky with a degree in Agricultural Economics.

He is a member of the Mercer County District Extension Board, Mercer County Community Endowment Advisory Board, Mercer County Cattlemen’s Association and Pioneer Baptist Church. He and his wife reside in Salvisa and have two adult children.

Community Financial Services Bank recently promoted Financial Department Team Member Kathy (Bedwell) Jones to Financial Department Team Leader. This was one in a series of promotions that President/CEO/Chair Betsy Flynn and Community Financial Services Board of Directors unanimously approved. These moves were made to ensure customer service and secure the future of CFSB. First Security Bank recently announced the promotion of Jon Lutgring to Assistant Vice President and Controller for the Bank. Jon joined First Security Bank in July of 2010 as Assistant Vice President and Assistant Controller. Jon’s duties include accounting for examinations, regulatory reporting, board reporting, budgeting, and oversight over the

Andy Waters President and CEO of Community Trust and Investment Company, is pleased to announce that Nikki Warford has been promoted to the position of Assistant Vice President with Community Trust and Investment Company.

Nikki Warford is a Retirement Services Relationship Officer in Wealth and Trust Management. Her responsibilities include the administration of institutional and retirement accounts. Her office is located at 1544 Winchester Avenue, Ashland, Kentucky.

June 2013 | 25

The 2010 Amendments to Article 9 Take Effect July 1 — Are You Ready? by John McGarvey The 2010 Amendments to Article 9 are effective in Kentucky, and most other states, July 1, 2013. The biggest changes are new standards for the form of name that must be used on financing statements for both registered organizations and individuals.

The Amendments give states two options for the form of individual name. Most states, including Kentucky, have selected the “Only If” option. Your financing statement will be sufficient only if it provides the name of your debtor as it appears on their unexpired driver’s license most recently issued by the state of their principal residence. If your debtor does not have a driver’s license, the fall-back standard in Kentucky is the surname and first personal name.

Some states, including Ohio, Indiana, Tennessee and Virginia, will allow use of a state issued I.D. card as a source of name for debtors without a driver’s license. The surname and first personal name is the second fall-back in those states.

A few states have adopted a less restrictive standard for the form of an individual’s name. A secured party will be perfected if they file under the debtor’s name as it appears on the driver’s license, under the surname and first personal name, or under the individual’s name. Perfection may be easier in these states but secured parties will have no direction on the form of name under which to search for other filed financing statements.

For registered organizations, the current name standard is the name in the public record of the office in which the organization was formed. It is not clear whether “public record” is what appears on a search page of the filing office website or, if there is a conflict, the actual record that formed the organization. The new standard is the “public organic record,” defined as the actual record through which the organization is formed. For Kentucky registered organizations, that record is available on the Secretary of State’s website.

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Existing financing statements can be brought into compliance with the new name standards during a five-year transition period. If your financing statement meets the name sufficiency standards that exist on June 30, you will not have to amend your debtor’s name on the financing statement until you continue the financing statement, and then only if the name differs from the name on the driver’s license or public organic record.

When filing on individuals, or amending existing filings, we recommend that you file under the name that appears on their driver’s license and, as though filing on a second debtor, filing under only the surname and first personal name. That way you remain perfected should the debtor’s driver’s license expire or be revoked.

Consider adding a provision to your loan documentation that requires individual debtors to annually furnish you with a copy of their driver’s license, and a covenant that individual debtors will notify you of any change in their name on their driver’s license or a change in the state from which they have a license. The name change will trigger a required amendment.

A change in issuing states will trigger a requirement for a new filing.

The new safe harbor forms for the financing statement and amendment reflect the new name standards. Among several other changes, note that there is no longer a requirement to list the type, state and I.D. number for registered organizations.

Other significant parts of the 2010 Amendments include the creation of information statements that can be filed by secured parties, provisions relating to control of collateral in electronic form, and the use of online auctions for disposition of collateral.

Morgan & Pottinger will be happy to offer a seminar on the 2010 Amendments to Article 9, “Playing the Name Game,” at your bank.

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