Ohio Record Magazine - Fall 2023 - Official Magazine of Ohio Bankers League

WHAT DOES AI MEAN FOR THE FUTURE OF BANKING?

The recent closing of Ohio Equity Fund 33A at $181 million will provide over 1,200 units of affordable housing in 16 projects in Ohio, Kentucky, and West Virginia.

OCCH

CF Bank

City National Bank

Civista Bank

Community Trust Bank

Farmers National Bank of Canfield

Farmers National Bank of Danville

Fifth Third CDC

First State Bank

Heritage Bank

Huntington CDC

JPMorgan Capital Corporation

Key CDC

Middlefield Banking Company

Minster Bank

Park National Bank

Premier Bank

Republic Bank

Stock Yards Bank & Trust

The Union Bank Company

WesBanco

Landing Springfield, Clark County

OVER THE HORIZON

Artificial intelligence is not new. Maybe given the inundation of AI over the past couple of months it was not surprising that when I told Audra, OBL’s Director of Communications and magazine editor, that I was going to use AI to write my next column, we had a good laugh. She shared that was going to be the theme of this edition. The topic of AI seemed to become pervasive over the span of a week earlier this year. Regardless of the subject, there is an AI aspect to it.

First, for a brief context, OBL has been engaged in comprehensive strategic planning over the past year. OBL was going to engage in a soup-to-nuts strategic planning process in 2020 but that was quickly derailed as we focused on the more-pressing issues of the day. I applaud OBL’s management team and staff for carefully scrutinizing everything that we do since the start of the pandemic. Yet, it was time to step back and do something more comprehensive in terms of tearing into the OBL mission of advocating, collaborating and educating. We commenced this process last year and will complete it later this year to influence the OBL’s 2024 business plan and budget.

Interested in seeing what AI could tell me about OBL to test its accuracy and see what fodder might be worth inclusion in the plan, I asked my iPhone’s ChatBox app, “What can you tell me about the Ohio Bankers League?”.

Here is its unedited response:

The Ohio Bankers League (OBL) is a trade association representing the interests of banks and financial institutions in the state of Ohio, United States. Here are some key points about the Ohio Bankers League:

1. Purpose and Membership: The Ohio Bankers League serves as a collective voice for the banking industry in Ohio. Its primary purpose is to advocate for the interests of its member banks, promote a favorable business environment, and provide resources and support to its members. The OBL's membership includes commercial banks, savings banks, and savings and loan associations operating in Ohio.

2. Advocacy and Government Relations: The OBL engages in advocacy efforts to influence legislation, regulations, and policies that impact the banking industry in Ohio. It represents its members' interests before state and federal lawmakers, regulatory agencies, and other relevant stakeholders. The OBL works to shape banking laws and regulations in a manner that supports the growth and success of its member banks.

3. Education and Training: The Ohio Bankers League provides educational programs, training, and resources to its members. These offerings cover a wide range of topics, including compliance, risk management, cybersecurity, lending practices, and industry trends. The OBL aims to enhance the professional development

and knowledge of its members to help them navigate the evolving banking landscape.

4. Networking and Collaboration: The OBL facilitates networking opportunities and collaboration among its members. It organizes conferences, seminars, and events where bankers can connect, share insights, and learn from industry experts. The OBL also fosters collaboration among member banks to address common challenges and explore opportunities for cooperation.

5. Information and Research: The Ohio Bankers League provides its members with access to information, research, and data related to the banking industry. This includes updates on regulatory changes, economic trends, industry benchmarks, and best practices. The OBL keeps its members informed about developments that may impact their operations and helps them stay competitive in the market.

6. Community Engagement: The OBL encourages its member banks to actively participate in community development and philanthropic initiatives. It promotes the importance of corporate social responsibility and supports efforts to strengthen local communities through financial literacy programs, volunteerism, and charitable activities.

7. Collaboration with Other Associations: The Ohio Bankers League collaborates with other industry associations, both within Ohio and at the national level, to amplify its advocacy efforts and share resources. It works closely with organizations like the American Bankers Association (ABA) and the Independent Community Bankers of America (ICBA) to address common industry challenges and advance shared goals.

Overall, the Ohio Bankers League serves as a unified voice for the banking industry in Ohio, advocating for its members' interests, providing resources and education, and fostering collaboration among banks in the state.

I was rather impressed with what ChatBox generated. However, while OBL has a long tradition of collaborating with any entity that will help advance Ohio’s banking industry and the industry at large, certain pieces of the AI response seem more aspirational than an assessment of the present circumstances. Certain national associations are not willing to reciprocate OBL’s collaborative stance despite my outreach over the years. That reality was a bit of a surprise to some OBL Directors during our strategic planning discussions. We are grateful for our partnership with the ABA and all of their resources we leverage for the good of Ohio’s banks.

Collaboration is one of the three legs of OBL’s mission, and we are continually looking at new partnerships to make Ohio’s banking industry as strong as possible. That only makes sense, especially in a consolidating industry.

We also constantly strive to present service providers with whom collaboration will help OBL member banks thrive. OBL is committed to maximizing the opportunities for bankers to collaborate with peers for the betterment of their communities and welcome our members’ help in facilitating additional collaboration opportunities at the national, state, and local level with other associations and entities. In the end, as membership organizations, members drive and determine what actions are taken on their behalf. We continuously seek out other associations in Ohio and elsewhere for collaboration that will ensure OBL’s value proposition is meaningful and sustainable.

We are honored that what OBL has been doing with and for Ohio’s banks for more than 130 years is as relevant and as in demand as ever. Sooner than later, AI could be a key player. Strategic planning is a valuable exercise for affirming the trajectory forward is appropriately adaptive in a dynamic environment. I am excited to be on that journey with the OBL Board and staff. You have the OBL’s continued commitment to look out further over the horizon so that we make informed decisions and achieve long-term success as we effectively navigate the complexities of the operating environment.

Michael J. Adelman President & CEO, Ohio Bankers League

Michael Adelman President & CEO madelman@ohiobankersleague.com (614) 340-7616

Gauri Airi Executive Director, Ohio Bankers Benefits Trust gairi@ohiobankersleague.com (614) 340-7598

Brenda Arnold Products & Services Manager, OBL BankServices barnold@ohiobankersleague.com (614) 340-7620

Steve Bare Database Manager sbare@ohiobankersleague.com (614) 340-7607

Don Boyd Vice President of State Government Relations and General Counsel dboyd@ohiobankersleague.com (614) 340-7608

Michelle Crume Senior Vice President, OBL Executive Director, OBL BankServices mcrume@ohiobankersleague.com (614) 340-7622

Taylor Daniel Executive Assistant tdaniel@ohiobankersleague.com (614) 340-7602

Stephanie Elam Plan Coordinator & Customer Service Specialist selam@ohiobankersleague.com (614) 340-7591

Rita Hinkle Administrator, OBBT rhinkle@ohiobankersleague.com (614) 340-7609

Daniel Holstein, CPA Senior Accountant dholstein@ohiobankersleague.com (614) 340-7604

Paige Houlihan Products and Services Coordinator, OBLBankServices phoulihan@ohiobankersleague.com (614) 340-7613

Sarah Husk Education Manager shusk@ohiobankersleague.com (614) 340-7610

Audra Johnson Director of Communications ajohnson@ohiobankersleague.com (614) 340-7621

Susan Poling Jones Professional Development Director spoling@ohiobankersleague.com (614) 340-7611

Julie Kiplinger Education Manager jkiplinger@ohiobankersleague.com (614) 340-7612

Evan Kleymeyer Senior Vice President of Government and External Relations ekleymeyer@ohiobankersleague.com (614) 340-7605

Kimberley Mason Higher Education Partnership Manager kmason@ohiobankersleague.com (614) 340-7601

Jennifer Osburn, CPA CFO, Chief Administrative Officer josburn@ohiobankersleague.com (614) 340-7606

Megan Peiffer Education Specialist mpeiffer@ohiobankersleague.com (614) 340-7618

Shannon Strow Government Relations Coordinator sstrow@ohiobankersleague.com (614) 340-7614

Christine Zeek Employee Benefits Manager, OBBT czeek@ohiobankersleague.com (614) 340-7617

The large group of Next Gen leaders from Park National Bank pose for a photo op. For many, this is their first time meeting each other. It is a great experience for all.

NEXT GEN CONFERENCE SPROUTS MORE SUCCESS AS RISING STARS LEARN TO G.R.O.W. THEIR LEADERSHIP

Just as seedlings grow into beautiful flowers and fruitful plants – so grow emerging leaders as they flourish into their roles in the Ohio banking industry. The 2023 OBL Next Gen Conference: G.R.O.W. Your Leadership, held June 8 & 9 in Columbus, featured an opening keynote workshop with Steve Lowisz, CEO, Qualigence International, who taught a record-breaking amount of over 200 attendees how to “Be Effective. Be Inspiring. Be Recognized.”

The individuals who were identified as rising stars in their institutions discovered how to make an impact as a next generation bank leader through the leadership session, as well as via concurrent breakout sessions on topics such as “Time Management & Delegation” and “Breaking the Stress Cycle.” They also had an opportunity to attend function-specific roundtable discussions led by members of the Next Generation Advisory Board. These sessions allowed bankers to share with and learn from each other and are a highlight of the conference. The ever-popular CEO Panel Discussion also allowed for attendees to gather insights from four industry leaders regarding employee expectations and to hear the executives’ views about the challenges of banking today – and how to better the industry so that institutions and careers can G.R.O.W.

“This was the 11th year for this annual conference, and we highly encourage every organization to send at least one young leader to this program in the future,” said Lindsay Cloud, EVP/CFO, Southern Hills Community Bank and 2023 Next Generation Advisory Board Chair.

SAVE

THE

Opening Keynote, Steve Lowisz, addressed the room on how to GROW in Leadership, setting the stage for an incredible conference.

Thank

Thank you to our CEO panel who fielded questions from the audience. The panel was led by Lindsay Cloud, EVP/CFO, Southern Hills Community Bank. The other participants included (from L to R) Eric Meilstrup, President & CEO, LCNB National Bank, Eric Faulkner, President, Citizens National Bank of Bluffton, Lisa Robinson Shaw, Central Ohio President, Wesbanco and Jordan Miller, President, CEO & Founder, Adelphi Bank.

The team at First Federal of Lakewood poses with their Summer Banking Institute intern during the Next Gen Conference. Interns in the SBI program were invited to attend the opening workshop.

CALLING ALL NEXT GENERATION LEADERS!

The OBL Next Gen Advisory Board, affectionally called “NGAB”, is a group of 19 emerging leaders representing all six OBL districts who help to guide the planning of the annual Next Gen Conference, as well as take an active role in GR events such as the Day at the Capitol and the Washington, DC Fly-In. In addition to attending these programs, the subsidiary board of the OBL meets several times each year, while the chair serves on the OBL Board of Directors.

The OBL is currently accepting nominations for the next class of NGAB members, whose roles will begin in November 2023. Contact Audra Johnson at ajohnson@ohiobankersleague.com for a detailed list of responsibilities for this 3-year term.

WITH ONE QUARTER OF THE GENERAL ASSEMBLY DONE, OBL SCORES KEY VICTORIES

The first quarter of any General Assembly (GA), which lasts two years, is devoted to working on and the eventual passage of the State’s operating budget which dictates how funds will be spent for the upcoming biennium’s fiscal year. In addition to allocating the state’s financial resources, it is typically the largest piece of legislation and largest policy document passed in any GA and touches about every aspect of the Ohio Revised Code. As such, issues can arise which can affect many aspects of banking and people’s daily lives. This year was no different, with the final document stretching over 7,000 pages and running up to the last minute to pass and be enacted for the new fiscal year beginning in July.

OBL was able to score some key victories for the industry while also playing defense against the inevitable bad ideas that always seem to percolate during these tumultuous legislative seasons. OBL has also been working on a few issues outside of the budget for the benefit of the industry. However, key pieces include successfully advocating for the creation of a state low-income housing tax credit (LIHTC) to be leveraged alongside the federal LIHTC, addressing issues related to the property tax valuation of LIHTC and other federally subsidized properties, and

fighting back against government infringement into the private business decisions of banks.

The focus will now shift to the fall ballot initiatives which include an abortion related amendment and, likely, an amendment regarding recreational marijuana. Lastly, the fall will also include another round of redistricting that will need to take place following court decisions from the last go round. The legislature is currently on break until mid-September but will return to take up any remaining issues that they will try to get done prior to heading into another election year in 2024. As always, OBL is meeting with legislators, staff, and the Administration to ensure industry priorities remain at the forefront of policymakers’ minds when they return in the fall. If you have any questions or would like to host a legislative meeting, please do not hesitate to reach out to OBL staff.

Budget Recap

As noted above, the budget was passed and included numerous provisions impacting the industry. Key items are detailed more fully below. The bill determines how the State will spend nearly $180 billion over the next

two years. It covers everything from tax changes, to education issues and housing.

Of note is that, on housing issues, all the budget items turned out positive. There is the creation of a statelevel LIHTC program in Ohio. On valuation, the budget includes an amendment to fix the valuation of LIHTC properties issue that arose at the end of last General Assembly in HB 45 (134th GA) which would have allowed county auditors to value federal subsidized properties using income based, market based, or cost approach formulas for valuation. The latter two of these would have not considered the very real restrictions on rent that these properties can charge and could have put many properties under financial stress. The amendment removes that language that was added and instead, inserts a formula that was negotiated between the affordable housing community, county auditors, and others. Additionally, the provision that would have expanded credit union authority by granting them access to the Ohio Capital Access Program (OCAP) was NOT included in the final version following significant OBL advocacy on the issue. There were also no provisions added on ESG or any substantive changes regarding the Financial Institutions Tax (FIT) which is always a concern in any budget. One issue arose in the Transportation Budget, HB 23, that impacts the process when a lien on a motor vehicle is paid off. Below is a breakdown of the individual issues OBL advocated on during the Budget.

State-Level Low-Income Housing Tax Credit and Property Valuation Fix

The OBL successfully advocated for inclusion in the budget of HB 3 which would create a state level workforce housing tax credit to leverage existing federal Low-Income Housing Tax Credit (LIHTC) program funds. In Ohio, thousands of affordable housing units have been developed utilizing the federal LIHTC program. The banking industry is an integral part of Ohio’s affordable housing development through investment in, and financing of, affordable housing projects throughout the state. Further, affordable housing development is a known catalyst of economic growth, job creation, and tax revenue. Additionally, this amendment positively addresses how these types of properties are valued for property tax purposes creating uniformity and predictability in the marketplace.

Welcome Home Ohio

A new program was created in the budget that established the Welcome Home Ohio Program under the Department of Development. The program allows the Director to

administer grants for land banks to purchase residential properties and funds for rehabilitating or constructing income-restricted owner-occupied properties held by land banks. It also authorizes the Director to issue tax credit certificates totaling up to $25 million each in FY 2024 and FY 2025. Property that benefits from these grants or tax credits is subject to certain provisions, including a prohibition on renting the property during a five-year sale prohibition period, annual certification of owner occupancy, and reporting of property sales. The Department of Development is required to maintain a confidential list of homes subject to 20-year affordability deed restrictions, and the levying officer must notify land banks about residential properties offered for sale at public auctions and post relevant information on a website.

Linked Deposit Programs

The Budget established the Homeownership Savings Linked Deposit Program, which will be administered by the Treasurer of State. The program allows eligible participants to earn above-market interest rates on their savings accounts with participating financial institutions. These savings can be used towards a down payment and closing costs for the future purchase of a primary residence.

Credit Union Power Expansion

The OBL successfully advocated for the removal of a provision which would have granted credit unions the ability to participate in the Ohio Capital Access Program (OCAP). OCAP is essentially a loan loss reserve program administered by the Ohio Department of Development to provide loans to qualifying businesses. This amendment had not received adequate vetting and consideration prior to inclusion. Additionally, our members continue to question whether credit unions, who are already not subject to Federal Income Tax, the Ohio Financial Institutions Tax (FIT), Sales Tax, nor federal requirements under the Community Reinvestment Act (CRA), truly need access to additional government support to provide business loans.

Don Boyd VP, State Government Relations & General Counsel, Ohio Bankers League dboyd@ohiobankersleague.com

AI APPLICATIONS IN BANKING: REALITY OR SIMULATION

ChatGPT has been one of the hottest topics of 2023, second only to Barbenheimer. ChatGPT is a form of artificial intelligence that is used to create a humanlike conversation with its users. ChatGPT, and AI more generally, is being used and implemented everywhere. From students using AI for homework assignments to doctors diagnosing patients, AI is infiltrating society for better or worse.

As a society, when many millennials think of AI, they conjure images of the AI mom-house courtesy of the Disney Channel movie “Smart House”, in which AI turned a lovely home into shear chaos. That movie alone makes anyone want to turn off their electronics and take a walk outside. [These thoughts, alone, can inspire just about anyone to unplug their router and figure out the weather by actually going outside.] Like the movie suggests, although AI poses great benefits, while also posing detrimental outcomes. So, putting this all together, Disney Channel Movie and all, it seems that, ultimately, the question is:

Does AI pose benefits, specifically in the realm of banking compliance? The answer is likely yes.

There are many definitions of AI, but the Artificial Intelligence Act of 2020 defines AI as

“(3) ARTIFICIAL INTELLIGENCE.—The term “artificial intelligence” means a machine-based system that can, for a given set of human-defined objectives, make predictions, recommendations or decisions influencing real or virtual environments. Artificial intelligence systems use machine and human-based inputs to—

(A) perceive real and virtual environments;

(B) abstract such perceptions into models through analysis in an automated manner; and

(C) use model inference to formulate options for information or action.”

This means that these computers can be taught to analyze patterns, make recommendations, and operate like a human would in certain situations.

How does AI help in banking?

Well, let us look to the expert itself. When asking ChatGPT: “Can you tell me about AI and banking compliance?” ChatGPT rattled off five paragraphs of suggestions in mere seconds. It discusses the benefits and the detriments of AI specifically in the banking realm and it was relatively on point.

From a positive perspective, it discusses AI being beneficial for Bank Secrecy Act (“BSA”) concerns and automation, specifically detecting suspicious activity, fraud, and money laundering. Further, it discusses customer due diligence (“CDD”) concerns. ChatGPT suggests that the bank can use AI to better streamline CDD procedures and document verification.

So, even considering the AI Disney Channel mom-house, it seems that there are elements of this skill pattern that suggest AI may be more beneficial than humans. For example, AI is great for detecting patterns, identifying abnormalities, and large amounts of data quickly. This is great for detecting illegal activity, notifying banks of the need to file SARs or CTRs, and noticing discrepancies with documentations. These are skills that can be overwhelming or time consuming for humans, but AI can do quickly and efficiently.

From a negative perspective, ChatGPT suggested that AI may be detrimental regarding UDAAP, fair lending/ fair banking, and process oversight. These programs may essentially run themselves, which can be both a blessing and a curse. From a UDAAP and fair lending/fair banking perspective, these programs may evaluate customers in a way that could possibly create a disparate impact. Furthermore, with automation, this tends to decrease human alertness (think self-driving cars). If the programs are incorrect or the algorithms are wrong, then this may

create mass automation of incorrect data or information. If one setting or pattern is off, it may cost banks absorbent amounts of money and time to correct the errors. Therefore, even ChatGPT recognizes the need for human judgment and oversight to avoid some of these concerns.

How else can AI help banking?

Outside of BSA and automation, AI may be a valuable tool for other areas of banking, such as customer service. First, some banks are using AI to monitor customer service calls. A.I can be trained to help monitor the customer experience, such as customer’s attitude during the call, associate’s helpfulness, and customer satisfaction. Calls may be recorded for training purposes and AI can makes suggestions or offer guidance on how to better the customer experience.

Further, AI can be used to chat with customers, take calls, and help with other areas of potential customer service backlog and transfer customers to the appropriate individual if further assistance is required. For example, if a customer wants to check their balance, AI can assist and complete the call. If the customer wants to apply for a loan, AI can take the application information and then transfer the customer to a loan officer.

Ultimately, AI can be a great, cost-effective tool for banks to implement within compliance and other areas of banking. It can decrease employment cost or offset employee shortages. It may help accurately identify BSA issues and concerns. Lastly, it may be used for underwriting and evaluating applicants.

That said, the technology is not perfect and there is a need for human intervention and human interaction. When customers are taking out a loan for their first house or opening their first bank account, humans desire the affirmation that someone is watching out for them, which is what bank employees do best. When an individual is going to make one of the largest purchases of their lives, sometimes a handshake can go further than an algorithm.

Carol Ann Warren Associate General Counsel Compliance Alliance

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JOIN US RINGSIDE! BE CHAMPIONS OF THE INDUSTRY!

Since its inception, the Ohio Bankers League Annual Meeting has provided a place for industry leaders to gather learn, network and share among peers and with valued service providers. In 2023, we are pleased to expand this program into The Main Event. Please join us ringside this November as we offer learning tracks across eight areas of the bank, including Executives, Finance, Retail, Human Resources, Lending and more! Plus, we will elect officers and present awards to industry leaders, some of which are new this year. We will also find time to connect with each other at receptions, special events and the BankPac Silent Auction.

As bankers, we sometimes have to roll with the punches that come with a changing economy and regulatory environment. This grand event will help each of us go the distance as we strive to be champions within the industry and to remain competitive in today’s changing world.

See you soon!

Michael J.

President & CEO, Ohio Bankers League

WHO SHOULD ATTEND?

The

Adelman

“TO BE A GREAT CHAMPION YOU MUST BELIEVE YOU ARE THE BEST. IF YOU’RE NOT, PRETEND YOU ARE.”

– Muhammad Ali

Main Event is designed for c-suite executives and leaders across all areas of the institution – including commercial and mortgage/consumer lending, human resources, retail, marketing, finance and legal.

SCHEDULE AT A GLANCE

MONDAY, NOV. 6

2:30 - 4:30 PM

CEO Roundtables

Join in peer conversations with CEOs from like-sized institutions. Topics are based on banker feedback and led by OBL executives.

2:30 - 4:30 PM

Lessons in Leadership

Joe Micallef, Sales Strategist & Coach, Grow Up Sales

Find out how to get CLARITY, CONFIDENCE, CONSISTENCY and CULTURE during this enlightening discussion forum, as Joe offers insights on the value of each pillar and challenges attendees to share experiences from the past several years.

5 – 6:30 PM

Welcome Reception

Ding! Ding! Ding! Time to kick things off with a Welcome Reception at the 2023 OBL Main Event!

9 – 11 PM

OBL BankPac Silent Auction & Late-Night Reception

Join us for opportunity to contribute to Ohio BankPac while giving it your best shot to win! Prizes awarded to the highest bidder while everyone wins by participating.

TUESDAY, NOV. 7

8 – 9 AM

OBL BankServices Expo

Visit with more than 35 OBL service providers, play an Expo game and win valuable prizes!

9 – 10:15 AM

Welcome & Opening Keynote

Jim Marous, The Financial Brand

10:15 – 11 AM

OBL BankServices Expo

11 AM – 12 PM

Learning Tracks ROUND 1

Attend breakout sessions for Executives, Finance, Retail, Commercial Lending/Credit, Mortgage/Consumer, Marketing & HR/Employee Development

12 – 1:30 PM

Lunch, Annual Meeting & Awards

Celebrate 2023 as we elect officers and present awards.

1:30 – 2:15 PM

Keynote Session: Perspectives from the Fed

Michelle “Mikki” Bowman, Member, Board of Governors of the Federal Reserve System

2:15 – 2:45 PM

OBL BankServices Expo & Break

2:45 – 3:30 PM

Learning Tracks ROUND 2

Attend breakout sessions for Executives, Finance, Retail, Commercial Lending/Credit, Mortgage/Consumer, Marketing, HR/Employee Development & Legal

3:30 – 3:40 PM

Break

3:40 – 4:30 PM

Learning Tracks ROUND 3

Attend breakout sessions for Executives, Finance, Retail, Commercial Lending/Credit, Mortgage/Consumer, Marketing, HR/Employee Development & Legal

4:30 – 8 PM

Dinner on Your Own

8 – 10 PM

Cards, Cornhole & Cocktails

Enjoy this casual gathering at this late-night event, featuring euchre, cornhole and down time with program attendees. Sign up with or without a partner in advance or on site!

WEDNESDAY, NOV. 8

8 – 9:30 AM

Breakfast & Closing Keynote Session

Logan Mallory, Motivosity

9:30 – 9:45 AM

Break

9:45 – 10:45 AM

Learning Tracks ROUND 4

Attend breakout sessions for Executives, Finance, Retail, Commercial Lending/Credit, Mortgage/Consumer, Marketing, HR/Employee Development & Legal

10:45 – 11 AM

Break

11 AM – 12 PM

Learning Tracks ROUND 5

Attend breakout sessions for Executives, Finance, Retail, Commercial Lending/Credit, Mortgage/Consumer, Marketing, HR/Employee Development & Legal

12 – 2:30 PM

Legal Track Continues

LEARNING TRACKS

DI NG! DI NG! DI NG!

Every round of Learning Track Sessions will feature hot topics from industry experts! Scan the QR Code or visit the OBL website for complete details on Learning Tracks.

PLUS! LE GAL TRACK!

The 2023 OBL Main Event features a Legal Learning Track on November 7 & 8.

CLEs will be available and pre-registration is required.

GENERAL SESSIONS

OPENING KEYNOTE: Building a Future-Ready Organization During Times of Economic Uncertainty

Jim Marous, Co-Publisher, The Financial Brand

In a period of unprecedented change, digital transformation is a requirement for survival. The ability to innovate at speed and scale creates new opportunities for growth. But, success is predicated on leadership that is willing to embrace change, take risks and disrupt existing paradigms. Jim Marous, the co-publisher of The Financial Brand and host of the Banking Transformed podcast, will open the Main Event as he shares:

• What marketplace changes are redefining banking today and in the future

• How to stem silent attrition impacting all institutions

• Why third-party collaboration levels the competitive landscape

• How to leverage the power of data and insight democratization

Marous noted, “Existing banking business models must be reimagined for a digital marketplace that expects proactive, personalized recommendations that financial wellness across that support financial wellness across the entire customer journey.” Find out more at this high energy session that will challenge as it inspires.

LUNCH KEYNOTE: Perspectives from the Fed

Michelle “Mikki” Bowman, Member, Board of Governors of the Federal Reserve System

Join Gov. Mikki Bowman for comments and an engaging conversation regarding Federal Reserve perspectives, news and updates.

Gov. Bowman took office on November 26, 2018, to fill an unexpired term ending January 31, 2020. She was reappointed to the Board on January 23, 2020, and sworn in on January 30, 2020, for a term ending January 31, 2034. Prior to her appointment to the Board, Ms. Bowman served as the state bank commissioner of Kansas from January 2017 to November 2018. She also served as vice president of Farmers & Drovers Bank in Kansas from 2010 to 2017.

In addition to her experience in the banking industry, Gov. Bowman worked in Washington, D.C. for Senator Bob Dole of Kansas from 1995 to 1996 and served as a counsel to the U.S. House Committee on Transportation and Infrastructure and the Committee on Government Reform and Oversight between 1997 and 2002. She has also served as director of congressional and intergovernmental affairs at the Federal Emergency Management Agency; and as Deputy Assistant Secretary and policy advisor to Homeland Security Secretary Tom Ridge.

CLOSING KEYNOTE:

Tips for Upgrading Your Leader by Ted Lasso

Logan Mallory, VP of Marketing, Motivosity

Whether you are as obsessed with Ted Lasso as we are or not, this session is for you! Managers and our teams have the biggest influence on employee engagement. So what are you doing to transform your managers into leaders throughout your organization? How are you developing your management style to take care of each employee on your team or within your organization? Don’t Listen to us, listen to Ted Lasso. We don’t want to spoil too much, but here are the teasers for what we will be talking about:

• Everyone’s on the team

• Be a Goldfish

• Fix the water pressure

• Mentors are better than managers

• Be curious not judgmental

• Genuine appreciation above all else

Why listen to Ted Lasso? The Harvard Business Review said that “In organizations with low employee engagement scores, they experience 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time. Importantly, businesses with highly engaged employees enjoyed 100% more job applications.” We’ll discuss principles that can take you from manager to a mentor to a leader to create a highly engaged team.

Photo credit: Chris A. Williams

EXTRA SPECIAL EVENTS!

MONDAY, NOVEMBER 6

CEO Roundtables 2:30 - 4:30 PM

CEOs from OBL member banks are invited to join peer conversations. The groups will be broken down by asset size and will feature discussions led by OBL management team members. Topics will be determined in advance of the sessions. Ready to register? Contact Taylor Daniel at tdaniel@ohiobankersleague.com.

Asset Groups include:

$0 - $250mm

$250 - $500mm

$500 - $1b

$1b and Above

Lessons in Leadership 2:30 - 4:30 PM

Joe Micallef, Sales Strategist & Coach, Grow Up Sales, will help attendees find Clarity, Confidence, Consistency and Culture during this enlightening discussion forum, as Joe offers insights on the value of each pillar and challenges attendees to share experiences from the past several years.

Who Should Attend: This session is designed for all Main Event attendees who are not attending the CEO Roundtables. It is ideal for all learning track and OBL Forum members, as well as emerging leaders and service providers who are attending, exhibiting or sponsoring the event.

Welcome Reception 5 - 6:30 PM

Ding! Ding! Ding! All Main Event registrants are invited to join OBL BankServices, as well as sponsoring and exhibiting partners, for a lively welcome reception. Enjoy light hors d’oeuvres and complimentary drink tickets.

OBL BankPac Silent Auction & Late-Night Reception

9 - 11 PM

Join us for the opportunity to contribute to Ohio BankPac while giving it your best shot to win! Prizes awarded to the highest bidder while everyone wins by participating.

TUESDAY, NOVEMBER 7

Cards, Cornhole & Cocktails 8 - 10 PM

Unwind from the day’s events with fellow attendees. The evening reception will feature cards - cornhole and cocktails. Sign up with or without a partner - in advance or on site!

AI STILL NEEDS HUMANS:

HOW TO HARNESS THE POWER OF BOTH WITH THE RAPID GROWTH OF CYBERATTACKS, PEOPLE AND TECH MUST WORK TOGETHER TO PROTECT MODERN NETWORKS.

Monitoring logs and analyzing data is mind-numbing and time-consuming work; it’s a fast path to burnout. AI has taken over this work, offering organizations a fast and efficient way to monitor their systems for potential threats. According to a Security Intelligence article,1 AI has improved cybersecurity operations in the following ways:

• Earlier recognition of threats via pattern identification and anomaly detection

• More informed ability to analyze data and identify potential attack vectors

• Improved threat intelligence due to ability to mine data sources

• Elimination of repetitive tasks via automation and orchestration

AI still lacks full capabilities

Companies benefitting from incorporating AI in their cybersecurity programs still require human intervention for the same reasons Tesla’s “Full Self-Driving” capability still requires a fully attentive driver: the deep learning capabilities of AI, where an algorithm completely mimics the structure and function of the brain, are just not there yet.

From an accuracy perspective, we often forget that AI is as inherently biased as the humans who created it. When fed distorted datasets – especially when the dataset is small – the precision of AI suffers greatly.

Even more alarming is when faulty conclusions are drawn within industries where lives and livelihoods are at stake (read: healthcare and finance). One algorithmic error has the potential to produce the false negative that gets your organization breached. Assets and users can be tagged as business-critical or high-risk to aid with risk scoring, but there is little nuance beyond this weighting.

A model for AI and human coexistence

Thankfully, effective models for AI/human coexistence are available. Human-in-the-loop (HITL) reinforcement learning works like call centers – AI is confined to assist with only a handful of predetermined actions, beyond which the situation escalates to an analyst.2 AI does the heavy lifting when it comes to monitoring, alerting human analysts when a possible threat is detected. They can then address and resolve issues more efficiently.

The benefits speak for themselves. MIT researchers discovered that when HITL was included in a security system, detection rates more than tripled, and false positives were reduced fivefold when compared to an unsupervised security system.3

Cybersecurity foundations for AI with a human touch

Follow these recommendations when incorporating AI into your cybersecurity program:

1. Build a strong foundation. “If you’re not already doing something, you can’t automate it,” says John Pescatore,

Director of Merging Security Trends at SANS. Ensure the basics of your cybersecurity program are strong before entertaining the idea of AI.

2. Select use cases wisely. Pick the low-hanging fruit by opting for large, quality data sets with readily available subject matter experts that can train the algorithm well. Capgemini Research Institute recommends the following to start: malware detection, intrusion detection, risk scoring, fraud detection, and user/ machine behavior analytics.4

3. Deploy SOAR workflows. Security, orchestration, automation, and response (SOAR) tools allow analysts to implement automatic workflows with manual decision points where appropriate.

4. Educate cyber analysts on AI technology. It’s essential for your staff to understand basic machine learning concepts and how your specific AI tool functions before going live with any AI tool.

With the buzz that surrounds new AI technologies like ChatGPT, it’s easy to get carried away with all the good

AI could do for cybersecurity. But, like all things in this industry, the smartest course is often the most boring: balanced investments between the sacred triad of people, process, and technology are still critical.

Sources

1 Gerald Parham, “4 Ways AI Capabilities Transform Security,” Security Intelligence, August 25, 2022.

2 Alessandro Civati, “Human-in-the-loop Model – Why AI Needs Human Intervention,” July 5, 2022.

3 K. Veeramachaneni, I. Arnaldo, V. Korrapati, et al. “AI^2: Training a Big Data Machine to Defend,” 2016 IEEE 2nd International Conference on Big Data Security on Cloud (BigDataSecurity.

4 Reinventing Cybersecurity with Artificial Intelligence: The new frontier in digital security,” Capgemini Research Institute, 2019.

Loraine Laguerta Technical Writer SEI Sphere

OUR CORE DOES MORE

Turn complex, traditional banking into a digitally advanced and customer-centric experience.

Why choose COCC?

At its heart, COCC is a fintech provider with a collaborative approach delivering next gen solutions. Uniquely owned by our clients, we understand the distinctive experiences required to service a community.

ARTIFICIAL INTELLIGENCE IS SETTING A FUTURE COURSE FOR ATMS

It’s not a secret that the current economic climate has put a strain on financial institutions. While many are concerned about a looming recession, increases in bank branch closures pose a major threat to financial inclusion by creating more banking deserts throughout the country and leaving more and more Americans unbanked.

Banking deserts have been increasing for years, but this trend became more pronounced as a result of the pandemic and changed the ways customers engage with financial institutions. Now, as we face what many are predicting will be a recessionary environment in the second half of 2023, there is growing concern that access to banking services, and cash in general, could be further threatened.

While these trends are concerning, research commissioned by Diebold Nixdorf sheds light on how automation and technology advances can combat these trends while also address shifting consumer expectations and preferences around financial institutions and ATM functionality. The survey found that cash usage remained strong in 2022, and ATMs continue to drive customer acquisition and retention, with one in five millennials and Gen Xers becoming aware of a financial institution’s product offering or services via the ATM.

This has pushed financial institutions to acquire the tools to adapt and modernize their branches. With a focus

on technology-based models, financial institutions are acquiring the tools to not only operate with less staff, but also adapt to evolving consumer preferences, all while closing fewer branches.

Keeping ATMs in service is more important than ever, and advancements in artificial intelligence (AI) are unlocking new capabilities in ATM maintenance and upkeep. When ATMs are true Internet-of-things (IoT) devices, detailed technical data can be continuously collected from sensors and data points and analyzed within cloudcomputing platforms with the use of machine learning. This can help them identify and monitor the devices’ lifecycles, and even establish a precise personality profile for every single device operating in the field.

The outcome is that when a device fails, the most likely root cause of the incident can be automatically established within a matter of seconds without the need to send a technician onsite to diagnose the fault. An automated recommendation can be issued about the precise fix, the required level of skills and experience of the technician, the spare parts needed and the time the repair should take. As a result, repairs can be better planned and completed faster.

An AI-driven approach can also enable the shift from a reactive to a predictive service model where incidents can be preempted. By analyzing data patterns, trends, leading

indicators and other key data points, impending failures can be identified, so maintenance activities can be scheduled at a time of low customer usage to avoid an unplanned future outage and maximize the uptime of a device.

While increasing ATM uptime is a clear need for financial institutions, the Diebold Nixdorf-commissioned study also illustrates why implementing these services is so vital in today’s economic climate.

ATMs are the second-ranking criteria for consumers when selecting their primary financial institution. Monthly ATM withdrawals increased significantly in 2022, signaling a renewed focus on access to cash. More than 40% of consumers are still using tellers for simple transactions, suggesting there is an opportunity to migrate even more transactions to self-service. This migration will improve operating efficiencies and allow branch staff to focus on higher-value customer interactions and experiences.

At a time when being “always on” is critical to the success of a bank, those financial institutions that apply AI technology to their ATM fleets can ensure they are providing the best possible services to their customers. Better ATM functionality will keep ATMs in service where they already exist and offer an opportunity to drive down

costs for new operations in areas where access to cash is critically lacking.

With AI, financial institutions have the technology to be able to better prescribe solutions to problems that threaten to hinder ATM operations. By reducing the rate of ATM failure, they will be better positioned to address the pain points of today’s customers, combat concerns about financial inclusion and provide a service that is built to adapt and improve as economic conditions naturally evolve.

We are setting a new standard for ATM performance with a first-to-industry, scaled, comprehensive and proven solution, which leverages real-time connections with deployed devices across the globe and shifts the paradigm from reactive to truly predictive. Learn more about DN AllConnectSM Data Engine.

Joe Myers EVP of Global Banking Diebold Nixdorf

FOR unmatched industry insight, VISion matters

FORward VISion counts

We applaud that the dreams you finance begin with a vision of making a positive impact in the communities you serve. Our vision is helping make yours a reality. Whether you’re looking to stay compliant, manage risk, or grow strategically, our forward-thinking professionals can help you prepare for what’s next.

BRIDGING INDUSTRY FORCES AT THE 2023 IBA/OBL ANNUAL CONVENTION

More than 450 leaders and guests from the Ohio and Illinois banking industries gathered at the Fairmont Millennium Park in Chicago for the 2023 IBA/OBL Annual Convention. The result? A dynamic and engaging program that bridged industry forces and generated new relationships across state lines.

Attending bankers from both associations participated in lively CEO Roundtable Discussions, while eight valued partners led informative breakout sessions on topics such as Managing Risk Amid Rising Rates, Inflation & Economic Challenges; and Maximizing the Value of Your Digital Transformation. In addition, more than 60 valued service providers took part in the Marketplace, where receptions and special events were also held.

General sessions featured Acting Comptroller of the Currency Michael Hsu, as well as other leading experts, including Derek Thompson, marketing and economy writer for The Atlantic, and Jack Uldrich, author and futurist of global trends.

Jack’s closing keynote address, “Business as Unusual: How to Future-Proof Your Business in Transformational Times” took at a look at hot topics such as AI, blockchain, cybersecurity and data analytics. He told attendees that we will see one-thousand-fold change in the next decade – and we have to begin to prepare for it.

He told convention-goers to learn to embrace ambiguity as the future is incredibly ambiguous. He said, “The future is going to unfold multiple ways at one time. You have to hold that in your mind as leaders. You have to start paying attention to trends and look for the opportunities.”

Uldrich continued, “Where is the future value of your bank going to come from? Incremental change, yes. Yet the big opportunities come from the future, which is why you must think deeper, smarter, harder – and keep your mind open to what’s next.”

SAVE THE DATES FOR 2024!

The 2024 IBA/OBL Annual Convention will be held at the OMNI Resort Amelia Island, Florida, June 24-27. Reserve the dates on your calendar now and watch for news regarding registration and the hotel room block.

First State Bank’s Ellie Zint and Dianna Setty with Dan Iza of KASASA in The Marketplace.

Jim Caliendo of PWCampbell, OBL Endorsed Business Partner, presents one of eight breakout sessions held throughout the event.

OBL President & CEO Mike Adelman addresses attendees at the joint annual convention.

Guests enjoy a Riverboat Architectural Tour while in Chicago.

Tony Davis of Peoples State Bank and Jason Buckley of Titan Armored at the BankPac Silent Auction.

Lisa Robinson Shaw of WesBanco receives a signed book from opening keynote speaker Deanna Singh.

Supporters of the Ohio BankPac Silent Auction & Casino Night check out following the evening event.

Kendall Rieman of The Croghan Colonial Bank and Bill Daily of Riverside Bank of Dublin visit with IBA Chair Betsy Johnson of Solutions Bank.

THE POWER OF ARTIFICIAL INTELLIGENCE AND IN-BRANCH BANKING EXPERIENCES

Capturing the attention of visitors to your branch is critical in having them decide if they made the right choice for coming in and feeling compelled to spend time with a banker. In the era of learning through short videos on social media, matching that mantra should also be capturing their attention in the branch. A marketing department can try to figure out what is going to capture and keep customer’s attention, but leveraging artificial intelligence (AI) will drive more compelling recommendations and give the data behind the results. Here are a few benefits and considerations for utilizing AI to personalize marketing content on digital displays inside a bank branch.

Increased Customer Engagement: Personalized marketing content can be tailored to each individual customer's preferences and needs, making it more

relevant and engaging. This can lead to higher customer satisfaction and a more positive overall experience.

Improved Conversion Rates: By utilizing AI to analyze customer data and behavior, banks can display targeted and relevant content to customers, increasing the chances of converting them into customers or encouraging them to take desired actions, such as signing up for a new service or product.

Enhanced Customer Experience: Personalized marketing content can help create a more personalized and customer-centric atmosphere within the branch. It can make customers feel valued and understood, ultimately enhancing their overall experience with the bank.

Cost Efficiency: AI-powered personalization can optimize marketing campaigns by targeting specific customer segments with the most relevant content. This can help banks avoid wasting resources on generic and ineffective marketing efforts, leading to cost savings and improved return on investment.

Reaping the benefits from this new technology does come with some caution, and there are some important points to consider before implementing it in your branch.

Data Security and Privacy: Utilizing AI to personalize marketing content requires the collection of agnostic data, meaning generalized to information like gender, age, mood, and attention span. It is not customer specific, but the bank should still comply with relevant data protection regulations and implement robust security measures to safeguard against breaches and unauthorized access.

Accuracy and Bias: AI algorithms rely on accurate and unbiased data to make intelligent decisions. Banks need to ensure that the data used in personalization efforts is reliable and doesn't perpetuate biases or discrimination.

Customer Perception and Trust: Some customers may view personalized marketing as intrusive or invasive, raising concerns about privacy. Banks need to be transparent about their data collection and usage practices and communicate the benefits of personalization to build trust with customers.

Technical Challenges: Implementing AI to personalize marketing content requires infrastructure and expertise in AI technologies. Banks need to invest in the necessary technology and resources to effectively leverage AI for personalization.

Balancing Personalization and General Content: While personalization can be powerful, banks should also ensure that they maintain a balance between personalized content and general information to cater to a diverse customer base. Generating content that appeals to a wider audience is equally important.

Incorporating artificial intelligence into your bank branch's marketing strategy is a forward-looking move that can transform customer engagement and experience. By harnessing AI's capabilities to tailor content for individual preferences, banks can cultivate a more customercentric environment. This personalized approach not only heightens satisfaction but also elevates conversion rates, translating into tangible business growth. However, as with any technological integration, a cautious approach is

crucial. Safeguarding data security and privacy, mitigating bias, nurturing customer trust, and overcoming technical hurdles are paramount. Striking the right balance between personalized and general content ensures a comprehensive outreach strategy. As banks navigate this exciting realm of AI-powered personalization, they're poised to unlock enhanced customer interactions and drive sustainable success within their branches.

Cole Clougherty Vice President of Business Development LaMACCHIA GROUP

Kim Jankowski Client Solutions Director LaMACCHIA GROUP

Unleash the Full Potential of Collaboration

With IT Resource and GigTel, your bank can break barriers and innovate together.

Implementing collaboration for your bank can be simple and affordable from the desktop to the boardroom to message, meet, and call instantly. IT Resource provides comprehensive voice and messaging solutions through our sister company, GigTel, which eliminates expensive on-premise equipment and is easy to use.

Now is the time to re-imagine collaboration!

REGULATORY ADVOCACY: A MUST FOR OUR INDUSTRY

Our friends in the healthcare or nuclear power industries might disagree, but banks are easily the most heavily regulated businesses in America. After legislation has been passed establishing new regulations, it will take months or years to be fully enacted. In that time, the industry’s advocacy on the issue cannot stop. State and Federal regulators have broad authority to tailor regulation in ways that could be helpful or harmful for the industry and the communities we serve. Every new regulation is required to go through a notice and comment period where the general public can suggest changes to the proposed rule. The OBL regularly comments on pending regulation. Our feedback varies from suggesting specific tweaks to the regulation or advocating for full withdrawal of a rule altogether.

In addition to the regulatory comment letters, establishing working relationships with our regulators is essential. It allows the OBL to provide a functional feedback loop between our banks and the regulators. The OBL meets with all the regulatory agencies on either a monthly or quarterly basis. On top of those meetings every February during our Washington DC Fly-In, bankers can speak directly with the heads of our federal banking regulatory agencies. We regularly have meetings with FDIC Chairman Martin Gruenberg, Federal Reserve Governor Michelle Bowman, and senior staff at the OCC.

Recently the OBL hosted CFPB Director Rohit Chopra at the OBL offices. Bankers from across the state were able to express concern or seek clarification from Director Chopra on the harmful statements he has been pushing recently in the media. The OBL pressed the Director to tone down his rhetoric on junk fees as all it accomplishes

is pushing individuals out of the banking industry. Instead, the association suggested establishing a working relationship with banks and their associations to better discuss issues facing our industry.

Last year, Chopra announced a crackdown on so-called "junk fees," warning banks that surprise overdraft charges and other fees that customers cannot reasonably anticipate or avoid, likely violate the Consumer Financial Protection Act. The Director’s crusade against legal and fully disclosed fees was a

OBL Chair Brian Young of The Union Bank Company and Mike Adelman pose for a photo with Federal Reserve Governor, Michelle Bowman.

Ohio bankers pose for a photo with CFPB Director, Rohit Chopra during his visit to the OBL office.

significant topic of conversation. Chopra agreed he has caused confusion in the marketplace for the treatment of overdraft and NSF representment fees. He very clearly stated banks can, and should, charge an overdraft fee since it is essentially an extension of credit.

The final most pressing topic was the discussion of the implementation of Section 1071 of Dodd Frank, the new CFPB Small Business Data Collection rule. Bankers expressed concern that this rule will increase the costs of small businesses lending due to the significant compliance burden placed on smaller institutions. We advocated the CFPB should reconsider the activity threshold to ensure OBL’s smaller members can still compete for small business loans. Since the current rule is on pause until the Supreme Court rules on the constitutionally of the CFPB’s funding structure, we pressed the Director to rescind the rule for all banks and go back to the drawing board after the ruling.

Evan Kleymeyer Senior Vice President of Government and External Relations, Ohio Bankers League

ekleymeyer@ohiobankersleague.com

Mike Adelman engages in conversation with Chairman of the FDIC, Martin Gruenberg.

Interest Rate Risk and Investment Strategies Seminar

October 4, 2023 | Findlay, OH Findlay Country Club

In 2020, the global COVID pandemic set into motion a series of historically unprecedented economic policies that upended markets and financial institutions, as well as the global economy itself. Massive amounts of liquidity and stimulus by policymakers enabled a fast recovery, but financial institutions found themselves awash in excess liquidity needing to be put to work at historic lows in yield. With time, the explosion of reserves also triggered an inflationary impulse unlike anything seen in decades. The Fed has been scrambling to get back in front of events and regain control of inflation ever since. The resulting rate hikes and monetary policy tightening have been unprecedented in both speed and magnitude. Portfolio managers now find themselves with scarce liquidity and deep unrealized losses, not because of poor management or asset quality, but simply because of the enormous swing in liquidity.

This seminar will examine the challenges now faced by CEOs, CFOs, and investment officers who must navigate the next phase of these uncharted waters. Join us for an in-depth discussion of the following topics:

• Economic and Market Update — Review of current economic conditions and the outlook for growth, inflation, and interest rates

• The Fed’s Next Moves — Update on the rate outlook and likely next steps for Federal Reserve monetary policy

• Interest Rate Risk — How to ensure you are prepared for uncertain balance sheet challenges and a constantly changing regulatory focus

• Liquidity Risk Management — Tools and best practices for managing liquidity risk

• Investment Portfolio Strategies — Adapting your strategy and finding the best relative value for the rate environment

• MBS/CMO Market — Balancing prepayment and extension risk in a changing environment for mortgage securities

• Municipal Market Update — Thoughts and strategies on managing municipal credit risk and finding the best relative value

AGENDA

Wednesday, October 4

Breakfast 8:00 am

Seminar 8:30 am

Lunch 12:00 pm

Golf 1:00 pm

(Enjoy a round of golf on us)

WHO SHOULD ATTEND

Financial institutions’ CEOs, CFOs, investment officers, board members, and those who are directly or indirectly responsible for financial management functions will benefit from this seminar. There is no cost for this seminar.

For your convenience, register for the seminar online at GoBaker. com/ohio-seminar/. Call Skoshi Heron at 888.990.0010 for more information.

ARTIFICIAL INTELLIGENCE PAYMENT SCAMS - PROTECTING YOUR ACCOUNTHOLDERS FROM FRAUD

As the financial services industry zeros in on the powers and perils of Artificial Intelligence (AI) technology, much of the focus surrounds the risk of financial institution use of AI. Yet, as technology evolves, so do the tactics of criminals. AI has unfortunately become a powerful tool for fraudsters, allowing them to target both consumers and businesses. And AI-powered scams are becoming increasingly common, threatening the safety and wellbeing of your accountholders, your employees and your financial institution.

Understanding AI Payment Scams

AI payment scams can take various forms, from phone scams to phishing emails. The technology enables scammers to quickly analyze data from social media and other online platforms, helping them identify potential victims and create personalized scams that are difficult to distinguish from genuine communications.

Look Out for These Common AI-Powered Payment Scams:

Personalized Phishing Emails: Scammers use AI to craft highly personalized and convincing emails to trick recipients into revealing personal information, downloading malware or transferring money to fraudulent accounts.

Spoofed Websites: AI algorithms can manipulate search engine results to make spoofed websites appear at the top of search results. These fake websites closely resemble legitimate ones and are used to collect sensitive information from unsuspecting users.

Stock Market Manipulation: Scammers manipulate stock values using AI algorithms to deceive potential investors into buying stocks at inflated prices, leading to financial losses.

Deepfake Technology: Criminals use AI to create convincing videos or audio recordings that impersonate someone, such as company executives or government officials, to persuade victims into transferring money.

Protecting Your Financial Institution and Your Accountholders

Financial institution employees play a critical role in safeguarding accountholders and your financial institution from these scams. Here are some valuable tips to share with team members and your accountholders:

Be Cautious with Links and Attachments: Don't click on suspicious links or attachments unless you are certain about the sender's legitimacy. Consider calling them using a valid phone number to verify the message.

Verify Email Addresses: Check the sender's email address for legitimacy. Hover over the sender's name to see the actual email address and ensure it matches the company's official domain.

Implement Strong Security Measures: Encourage the use of unique passwords for all accounts and enable multifactor authentication to add an extra layer of security.

Be Skeptical of Unsolicited Communications: Be cautious about unsolicited phone calls or emails and to verify the authenticity of any requests before taking action.

Keep Software Up to Date: Regularly update software and apply patches to protect against potential vulnerabilities that fraudsters may exploit.

Educate Yourself and Others: Educate accountholders about common scams and encourage them to report suspicious activity.

Bank employees have the power to educate and protect your institution and accountholders from the evolving threats of AI payment scams. By sharing these tips and resources, you can empower account holders and team members to make informed decisions and stay safe in the digital world. Together, let's fight back against payment scams and ensure a secure banking experience for everyone.

EPCOR has a variety of fraud-focused videos to help you educate your accountholders about other types of payment scams available on YouTube (@EPCORPymnts). Visit epcor.org for a listing of educational events to help you keep a pulse on the payments industry. Stay vigilant, stay informed and stay safe out there!

Brandie Thacker, AAP Vice President, Communications & Member Support, EPCOR

OBL ENDORSES ABRIGO’S BAM+ AND FRAUD SOLUTIONS FINANCIAL CRIME PRODUCTS

The Ohio Bankers League (OBL) announced its endorsement of Abrigo’s BAM+ and Fraud Solutions financial crime products, aiming to assist its members in detecting fraud, managing alerts, and combatting money laundering.

In addition to Abrigo’s financial crime products, the OBL also extends its support to Abrigo’s Sageworks lending and credit software solutions and portfolio risk solutions. With a proven track record of enhancing credit analysis and creating more efficient loan origination processes, Abrigo helps community financial institutions thrive.

“OBL is pleased to include these financial crime products in its endorsed partnership with Abrigo,” said Michelle Crume of the Ohio Bankers League. “Abrigo is a valued business partner with services that can assist Ohio banks with maintaining compliance, fighting financial crime, and processing loans quickly.”

Currently trusted by more than 2,500 community financial institutions, Abrigo’s software plays a pivotal role in helping financial institutions maintain compliance requirements, automate critical processes, and make informed decisions based on data. Jay Blandford, CEO of Abrigo, emphasized the significance of gaining the recognition and trust of industry leaders like the

OBL, stating, “We are deeply honored to earn the acknowledgment of the Ohio Bankers League. Our shared objective is to empower community financial institutions by equipping them with the best possible tools for their success.”

Abrigo not only excels in software development but also offers advisory services and exceptional customer support. Moreover, they actively contribute to industry thought leadership by publishing insightful blog posts and articles.

About Abrigo

Abrigo is a leading provider of compliance, credit risk, lending, and asset/liability management solutions and services that help financial institutions thrive. Abrigo accelerates growth, increases client efficiency, and improves customer experience with an easy-to-use and expansive platform. We ensure customer success with our award-winning client service team, advisory expertise, and innovative technology. With a network of 2,400+ FIs, Abrigo offers unique opportunities for insightful peer benchmarks and best practices. Visit abrigo.com to learn more.

OBL BANKING CALENDAR

CREATING CONTENT WITH A CLICK: A HANDS-ON VIDEO WORKSHOP

October 4 (Virtual)

Popular instructor Beth Z, Your Nerdy Best Friend, returns to the OBL as she teaches bank marketers how to take videos for social media and marketing to the next level – all on a budget friendly bootstrap. In this workshop, attendees will learn a dozen easy tech tools to create amazing presentations while also honing storytelling and image-creation skills. The program will also introduce new AI text-toimage tools to evaluate which multimedia tools are best.

What do Beth Z fans have to say about past OBL workshops?

Beth Z is not only extremely knowledgeable in her realm; she is uniquely entertaining and dynamic with her engagement.

Jam-packed with useful info and loads of fun. Join attendees from the OBL and partner associations, including Indiana Bankers Association, Kentucky Bankers Association, Michigan Bankers Association, PA Bankers, West Virginia Bankers Association and Wisconsin Bankers Association.

Questions can be directed to Susan Poling Jones at spoling@ohiobankersleague.com.

BANK TECH CONFERENCE

October 5 (Virtual & In-Person/Chicago)

Help to move your organization forward via the 6th Annual BankTech Conference. Offered collaboratively by the OBL, Illinois, Indiana and Michigan Bankers Associations, this event will be available virtually and in-person at the Doubletree by Hilton Chicago in Oak Brook, IL.

Eric Geiger, chief technology officer, Federal Home Loan Bank of Chicago, will kick off the day, while attendees will later hear about Banking Ex Machina: Preparing for AI and Machine Learning with a panel from Barack Ferrazzano Financial Institutions.

A highlight of the day is an Innovators Showcase, where more than a dozen organizations will demonstrate products and services to help banks navigate this evolving landscape. Those attending in person will also benefit from networking breaks and activities.

The program, priced at just $99, is designed for executives and senior management from financial institutions in the Midwest, as well as those in the IT/Operations, Compliance and Retail arenas.

Questions? Contact Susan Poling Jones at spoling@ohiobankersleague.com.

AI ISSUES, EFFECTS & MORE ADDRESSED VIA WEBINARS

Live and OnDemand

Get your team up to speed on the latest AI issues, effects and more. Check the website for full details and registration for these live and OnDemand programs via the Graduate School of Banking-Madison, or as noted.

• Improving the Customer Experience with AI –Recorded Sept. 21

Learn how data insights can help banks improve customer experience and how finding a data and AI partner can make this transition possible, even for small and midsize banks.

• How can AI Help my Bank? – Oct. 19

Learn how your bank can initiate or accelerate your AI projects and ensure those projects are operationalized to deliver full value.

• Customer 360: Breaking Down Data Silos to Build a Consolidated View of Your Customer Accounts, Activities and Behaviors through Analytics and AI – Oct. 26

Learn of the opportunities an enhanced customer view can provide the bank, the challenges involved in getting there, and how the right partner can accelerate the development of an accurate customer 360 view that can deliver critical improvements in revenue growth, profitability and customer experience.

• Hacker Hour featuring AI with SBS CyberSecurity – Recorded August 8

• Risks & Rewards of AI in Banking – Presented by Carl Pry, OnCourse – Recorded July 31

This program discusses concerns and risks so that you can properly monitor and establish controls for technologies to best manage regulatory expectations.

Contact education@ohiobankersleague.com with questions or for registration assistance.

OBL COMMERCIAL CREDIT SCHOOLS

Essentials (November 28 & 29); NEW! Advanced Workshop (November 30 & December 1) – OBL Education Center

Popular instructor Mike Wear, loan portfolio management section leader at the Graduate School of Banking – Madison, returns to the OBL to facilitate two engaging commercial credit schools that are a must for your bank’s lending team.

Using real-life business case studies, the OBL Commercial Credit School (Nov. 28 & 29) provides a deeper understanding of credit analytics and applies a structured industry analysis tool. The school brings together core and advanced elements of business lending and credit evaluation, and new for 2023, will also feature problem loan workouts. Past students note the discussions, case studies and Mike’s desire to make learning interesting and fun as highlights of the program that is ideal for new and experienced commercial lenders, credit analysts, ag, retail and mortgage lenders, retail bankers and credit risk administration staff.

NEW! The OBL Advanced Commercial Credit Workshop (Nov. 30 & Dec. 1) is the next level of training for bankers with five plus years of experience. It is case driven, using pass-rated businesses with underlying issues that many bankers overlook. Attendees will participate in hands-on training with guidance on how to proceed; and will include a deeper drive into CRE, as well as share ideas on ways to underwrite different property types and loans.

Questions? Contact OBL Education Manager Sarah Husk at shusk@ohiobankersleague.com.

AROUND THE INDUSTRY

Millersburg, Ohio

Eddie Steiner, Chief Executive Officer of The Commercial & Savings Bank (CSB), recently announced the promotion of Brett Gallion to President, Chief Operations Officer/Chief Information Officer. Gallion has been an officer of the Bank since 2010 and has served as the Bank’s Executive Vice President since 2020 and ranking Operations and Information Officer since 2016.

“Brett’s confidence-inspiring leadership and track record of delivering stellar results make him uniquely qualified for the role of President of The Commercial and Savings Bank,” stated Steiner.

“We are pleased to be able to execute on our succession plan with this announcement and continue to build an outstanding team of leaders dedicated to CSB's vision of enduring greatness.”

44224, which opened in May, 2022. The loan production office offers mortgage and commercial loan products to residential and commercial customers in the Akron, Canton, and Cleveland markets.

Urmson is a 30-year veteran of the banking industry having been involved in all aspects of residential lending from management to origination. He has extensive experience in new home construction financing, working closely with builders and developers.

"I am excited to be a part of Andover Bank to help expand the Bank’s lending footprint and to introduce its unique product set to potential homeowners across northeast Ohio," added Urmson.

Conneaut, Ohio

Andover Bank is pleased to announce the recent hiring of Todd Urmson, Mortgage Loan Officer, to its mortgage lending team. Urmson will be based out of the Bank's loan production office at 3924 Clock Pointe Trail, Stow, Ohio

Warsaw Federal Savings and Loan

Cincinnati, Ohio

Christie Joslin has been named the President and CEO of Conneaut Savings Bank in Conneaut, Ohio as of July 2023. Christie has been with the bank since 2017 and has held the positions of Controller and Chief Financial Officer. Conneaut Savings Bank is approximately $83M in assets and has two branches in Northeastern Ohio.

Warsaw Federal Savings and Loan, an independent mutual bank affiliated with First Mutual Holding Co. (FMHC), announces the appointment of Robie K. Suggs as President and CEO. A lifelong Cincinnati-area resident and banking professional, Suggs will represent Warsaw Federal in the community and have ultimate responsibility for the bank's sales, operations, and financial performance.

Serving most recently as the Chief Lending Officer for Cincinnati Development Fund, Suggs brings substantial financial services experience to Warsaw Federal. Before that, served as Vice President of Strategic Partnerships and Vice President of Economic Development and Community Outreach for First Financial Bank. Suggs also held positions of increasing responsibility during her 20-year tenure at PNC.

“Robie’s proven success helping communities thrive aligns perfectly with our mutual bank mission. Her deep commitment to the organizations in our markets and her rich banking experience makes her a natural leader for Warsaw Federal," said Thomas J. Fraser, CEO of FMHC. “We welcome Robie to our banking family and look forward to the positive impact she will have on the customers, community, and Warsaw team members.”

“I’m thrilled to be joining Warsaw Federal, and I look forward to supporting the needs of our customers and community.”

Brett Gallion

Todd Urmson

Christie Joslin

Robie K. Suggs

Ohio Bankers Benefits Trust

COMING TOGETHER TO CONTROL BENEFIT COSTS

In today’s competitive marketplace, benefits have become as important as compensation when hiring or retaining the best and brightest. But health insurance is not inexpensive.

The Ohio Bankers Benefits Trust was developed in 1952 to mitigate health benefits costs by bringing bankers together.

When we harness the collective resources of Ohio’s banks and thrifts, everyone wins.

For more information about the OBL health plan options contact: OBBTCustomerService@ohiobankersleague.com

OHIO BANKERS BENEFITS TRUST

THE TOP TEN

1 FANNIE MAE PLANS TO CUT OFF SOME BANKS FROM SECONDARY MARKET SALES

Fannie Mae recently sent notice to several Ohio banks that their approved seller status will be terminated unless they increase their volume of sales to the enterprise.

2 CFPB DIRECTOR CHOPRA VISITS OBL

Today CFPB Director Rohit Chopra met with the OBL and a group of bankers from around the state to hear our industries issues.

3 U.S. DISTRICT COURT GRANTS INJUNCTION ON CFPB SECTION 1071 FINAL RULE

The Texas Bankers Association (TBA) and co-plaintiffs, Rio Bank of McAllen, Texas, and the American Bankers Association (ABA), have been successful in their motion to halt implementation of the Consumer Financial Protection Bureau’s (CFPB) Section 1071 Final Rule.

4 OBL PAST CHAIR, TOM FRASER, TO TESTIFY BEFORE THE SENATE BANKING COMMITTEE THIS THURSDAY

Last week, OBL Past Chair, Tom Fraser, CEO of First Mutual Holding Co. in Lakewood, Ohio, testified before the Senate Banking Committee about FDIC Insurance Reform. Tom fielded questions from several senators and was able to speak eloquently about the future of the Deposit Insurance Fund, special assessments,

In this quarterly feature, the OBL highlights the ten news articles that you have visited the most at www.ohiobankersleague.com.

consumer protections and potential future risks. Thank you, Tom, for being such a strong advocate for the industry here in Ohio.

5 OBL AND OTHER STATE BANKERS ASSOCIATIONS PUSH TO INCLUDE ALL BANKS IN 1071 RULING

The current ruling on 1071 only relieves members of the Texas Bankers Association, American Bankers Association and Rio Bank. However, OBL and all other State Bankers Associations are fighting to be included in the relief of the ruling.

6 OHIO’S BIENNIAL OPERATING BUDGET SIGNED INTO LAW MONDAY, KEY OBL ISSUES PRESENT IN FINAL TEXT, POTENTIALLY HARMFUL ISSUES OUT

After months of hard work and discussion, Governor DeWine signed the Biennial State Budget into law Monday just ahead of the extended deadline.

7 OBL GOVERNMENT RELATIONS TEAM PROVIDES 135TH GENERAL ASSEMBLY UPDATE

With the finalization of the Biennial Operating Budget, we have completed the first quarter of the 2023-2024 Ohio General Assembly. The OBL Government Relations Team has put together a recap and progress update report to provide information on what has happened during the first 6 months of the 135th GA.

8 NEW OHIO BUDGET BILL DELIVERS UPDATED ECONOMIC DEVELOPMENT INCENTIVES

A Client Alert from Vorys

On July 4, 2023, Governor Mike DeWine signed Amended Substitute House Bill 33 (H.B. 33 or the Budget Bill), which creates the biennial budget for state fiscal years (SFY) 2024-2025 (July 1, 2023-June 30, 2025). H.B. 33 delivers some new initiatives and some important changes to economic development in the State of Ohio through the Ohio Department of Development (ODOD). The General Assembly also enacted and amended important housing incentives through H.B. 33.

9 COMPTROLLER HSU TO OBL: DON’T EXPECT ANY SURPRISES Comptroller of the Currency Michael Hsu spoke at the OBL Convention last week, and assured banks they will not see any surprises out of their OCC exam teams in their upcoming exams.

10 OBL CONTINUES PUSHING KEY ISSUES AS LEGISLATURE HEADS INTO FINAL WEEKS OF THE BUDGET PROCESS

Governor DeWine, the House and Senate have all released their versions of the State Budget. As they head into Conference Committee, OBL continues to have important conversations and advocates for key industry issues.

At Vorys, we know how to handle all the complexities of the financial world. We also know how to be practical, straightforward and just get the job done. And we have developed a unique and effective interdisciplinary team approach to business that covers every facet of financial services in a cost-effective manner.

With 25 years of experience as a trusted partner for Ohio community banks, Banc Consulting Partners is the stable provider in BOLI design, analysis, compliance and plan administration.

And don’t just take our word for it. Ask the Ohio Bankers League, where we have been a reliable Endorsed Business Partner for the last 19 years. In fact, we have earned the trust of more Ohio community banks than any other firm in the country.

So when you want the best relationship for your BOLI portfolio and a firm that is dedicated to Ohio community banks, talk to Lou Moore at Banc Consulting Partners.