Ohio Bankers League 2012 Summer Magazine

summer

2012 issue

The Official Magazine of the Ohio Bankers League

LESSONS IN

LEADERSHIP OBL Joint Convention Memphis, Sept. 6-9

INSIDE THIS ISSUE

CHOICE OF CHARTERS CAREFUL DUE DILIGENCE IS KEY

HOW TO SYSTEMATIZE YOUR SALES CULTURE WITH SALES GURU ROXANNE EMMERICH

OBL CEO SYMPOSIUM IN PICTURES

Consultants to the Financial Industry

Y o u n g & As s o c i a t e s , I n c .

Strategic Planning Liquidity Planning Regulatory Assistance Stock Valuations Capital Markets Expansion & De Novo Bank Charters Internal Audit Information Technology Recruitment & Human Resources Lending & Loan Review Compliance Policy Development

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Contents A Comprehensive Resource for the Ohio Banking Industry

Other News

Features

4 Chairman’s Corner

6 Random Thoughts

27 Steps of the Statehouse

30 The Banker’s Calendar 45 Around the Industry

8 OBL CEO Symposium In Pictures

10 OBL Investment Partnership an Easy Cure for Broker-Dealer Headaches 12 How to Systematize Your Sales Culture 14 Managing Compliance Risk

CFPB Working on a Wide Range of Issues

16 Public Eye

OBL Fights for Industry’s Image in Media

18 Charter Choice 22 Lessons in Leadership

OBL/ILFI Joint Convention

32 Working Together is More Important Than Ever

34 Ombudsman Service Provides FDIC Batphone 36 Fraudulent Wire Transfers Continue to Plague Community Banks

38 What Starts in Vagueness, Stays in Vagueness 41 Ahead of the Curve

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chairman’s corner Industry Needs to Adapt, Be More Aggressive More than 150 years ago, Charles Darwin wrote his magnum opus, On the Origin of the Species. What he wrote back in the 1850s still holds true today: In order to survive and thrive you need to adapt to your environment.

This has never been truer for our banking industry. Sometimes it feels like we are being attacked by all sides – be it the regulators, Congress or the national press. If we are to thrive in these difficult times, it is essential to not only adapt, but also to educate our detractors.

It was in this spirit that I joined the OBL’s Mike Van Buskirk and Jeff Quayle, along with Andover Bank’s Marty Cole and KeyBank’s Bill Blake for a field hearing of the House Subcommittee on Financial Institutions and Consumer Credit in Cleveland earlier this year. The staff at the OBL work incredibly hard behind the scenes on our behalf, but nothing has more effect on our elected officials than when they hear from the folks working on the front lines. That’s you and me.

The hearing in Cleveland put the spotlight on something that’s very close to my heart, so testifying on it, while a bit nerve-wracking, came easy. Our elected officials wanted to hear how I thought regulatory developments have affected my ability to operate effectively.

Compliance Marty and I told them how many of us, already operating under wafer thin margins, have had to hire an extra person just to focus on compliance with the thousands pages of extra regulation brought about by Dodd-Frank. Not serving the customers, not helping our communities, just focusing on the details of compliance.

This kind of message resonates with our elected officials because they understand the important role community banks play in their constituencies.

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G. Courtney Haning OBL Chairman & Chairman, President & CEO, Peoples National Bank of New Lexington

Many successful small businesses in Ohio, including those that have grown to be large, started with a close call on a loan, made by a community bank which could say yes safely because it knew its customer very well.

Unfortunately, this ability to exercise good judgment based on local market knowledge is being threatened both by recent regulatory burdens heaped on banks

by Washington, and by Haning, with House Subcommittee on Financial Institutions inconsistent decisions and Consumer Credit Chairwoman Shelley Moore Capito made by our regulators. and Andover Bank’s Marty Cole Marty zeroed in on regulators and the exam process. “My bank great way to start one. The more aggressive examiner has an almost impossible job and persistent we are in developing today. The system is broken,” he said. relationships with our elected officials, the Citing a specific example, he added, better we all will be in the long run.

“One result of the mixed message Congress As an industry we are noted for sends the agencies is inconsistent messages managing risks, for being solid, small ‘c’ examiners give to banks. The regulators conservative and dependable. But times tell us to help our problem borrowers but have changed and as Darwin said, “If we then they classify performing loans because are to thrive in this new age, maybe we an appraisal shows lower collateral value.” have to adapt with them?”

Other Ways to Get Involved

Convention 2012

While going on the record in Congress is important, it’s not the only way to get involved and support the industry. Our political action committee, Ohio BankPac, is more critical than ever. If we don’t have the funds to support the candidates who support us, we are high and dry. Give Joe Rosato a call at OBL HQ and find out how your bank can conduct a PAC drive.

Host a meeting with your congressman or state legislator in your bank. Invite bankers from your county. Personal relationships make a difference and that’s a

I hope you plan to join me and our friends from the Illinois League of Financial Institutions at our 2012 Convention in Memphis. The home of Elvis promises to be a fun place, with another first rate schedule of speakers and events.

Melea Wachtman’s article on p.22 offers full details, but I can promise that once again you will find a great location and networking, along with a bunch of ideas you can take back and use in your bank right away. I hope to see you there.

4249 Easton Way, Suite 150 Columbus, Ohio 43219-6170 Fax (614) 340-7596

James Thurston, Editor Susan Poling, Features Association Staff Michael Adelman Vice President of State Government Relations madelman@ohiobankersleague.com | (614) 340-7616 Brenda Arnold, Products & Services Manager OBL BankServices barnold@ohiobankersleague.com | (614) 340-7620 Mike Baker, VP & Executive Director, OBL BankServices mbaker@ohiobankersleague.com | (614) 340-7600 Dan Conklin, Registrar dconklin@ohiobankersleague.com | (614) 340-7607 Michelle Crume, Vice President & Regional Director OBL/Infinex Partnership mcrume@ohiobankersleague.com | (614) 340-7622

OBL Golf Cl assic 2012 SEPT. 27 LITTLE TURTLE GOLF CLUB

Carol Halkias, Accounting Manager chalkias@ohiobankersleague.com | (614) 340-7604 Erin Husslein, Administrator Ohio Bankers Benefits Trust ehusslein@ohiobankersleague.com | (614) 340-7617 Julie Kiplinger, Manager of Professional Seminars & In-Bank Training jkiplinger@ohiobankersleague.com | (614) 340-7612

The OBL returns to Little Turtle Golf Club, host of several USGA Amateur Qualifying

Sue Leppert, Administrative Assistant sleppert@ohiobankersleague.com | (614) 340-7602

Tournaments, for the annual Golf Classic

Lynn Moore, Accounting Coordinator, Compliance Coordinator, OBL Compliance Services lmoore@ohiobankersleague.com | (614) 340-7618

on Sept. 27. The shotgun start event

Susan Poling, Education Manager spoling@ohiobankersleague.com | (614) 340-7611 Jeff Quayle, SVP & General Counsel jquayle@ohiobankersleague.com | (614) 340-7603 Joe Rosato, Government Relations Coordinator jrosato@ohiobankersleague.com | (614) 340-7605 Gary Sutter, Employee Benefits Manager, OBL BankServices gsutter@ohiobankersleague.com | (614) 340-7615

includes 18 holes of golf, a buffet luncheon, cocktails, dinner and an awards presentation immediately after the completion of play. Golfers may choose from two formats – play your own ball

James Thurston, Communications Manager jthurston@ohiobankersleague.com | (614) 340-7620

or scramble; and may register as a single

Mike Van Buskirk, President & CEO mvanbuskirk@ohiobankersleague.com (614) 340-7601

player; two players; or put together your

Melea Wachtman, Senior Vice President of Administration mwachtman@ohiobankersleague.com (614) 340-7606

own foursome. Contact Gary Sutter at 614-340-7615 for more details.

The Ohio Record is published quarterly by OBL BankServices. Member subscriptions may be purchased for $25 per year; Non-member subscriptions may be purchased for $50 per year.

POSTMASTER: Send address changes to Ohio Record at the address listed above.

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random thoughts You Can’t Complain if You’re Sitting on the Sidelines Humankind comes in many shapes and sizes; but we do share common experiences and traits. Irrational rules and behavior bedevil most of us (not just bankers) and most of us complain about it. What I write about today is what can be achieved by those bankers who do more than gripe.

Regulator Overkill Government seems particularly inclined to bless bankers with a great deal to complain about. Every working day you go through procedures and fill out forms that aren’t efficient and often aren’t very useful to anyone. That produces the byproduct of denying you time and flexibility you need to serve your customers and community. In general banking regulations do stem from good intentions; but almost always represent egregious overkill and far too often generate the famous “unintended consequence” which causes real damage.

In general government bureaucracies don’t listen well. I say this with affection as a former federal employee (when I was young and innocent). If you have tried to speak up, you probably found policy makers seemed deaf or at least very hard of hearing. The consequence is that many bankers, if they ever tried to speak up to start with, soon gave up. There is little time in banks today for tilting at windmills.

Fortunately for us all, a few bankers daily demonstrate a very high level of tolerance for frustration. They keep trying to make laws and rules better for themselves, their shareholders, and their customers. Most believe, as I have come to believe, that dogged persistence does work. Bankers like Court Haning (Peoples National Bank of New Lexington), Marty Cole (Andover Bank), Paul Reed (Farmers Bank and Savings Company, Pomeroy), Steve Wilson (LCNB National Bank, Lebanon), and Bill Blake (KeyBank, Cleveland) have testified over past months before

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Congressional and General Assembly banking committees. They came not just to point out problems but equipped with thoughtful ideas for solutions. And guess what? It looks like someone listened.

Progress that comes very slowly can give the appearance that progress is impossible; but in fact bankers’ actions are making a difference. If more would engage, I firmly believe meaningful progress would come faster and be much more pervasive.

“You are a community leader with real, practical insight into the conditions and needs in each of the congressional districts. We are effective because a constituent banker community and political activism gives us credibility.”

After a recent House Financial Services Committee field hearing in Cleveland, where some of the bankers mentioned above testified, Chairwoman MooreCapito passed a bill that would eliminate the need for external ATM signage (and the current vulnerability in Ohio and other states to ambulance chasing trial attorneys if the sign is damaged or missing). She has introduced another to significantly lessen exam burden.

A problem with a magazine column is time passes between writing and publication, so what at the moment is a current event may be old news by the time you read this. I literally just received a call from Washington that the full U.S. House just approved the ATM signage bill. If you heard wailing, it no doubt was ambulance chasing trial attorneys. The bill won most of the votes from the Ohio delegation. Why? Because bankers testified; other bankers who

Michael M. Van Buskirk President & CEO

had earlier taken time to get to know their Congressman, had calls answered and letters read. These bankers had all invested in getting to know their member of Congress. As a result, what they said was heard and believed.

When OBL staff goes to Washington, and OBL Senior Vice President Jeff Quayle is there as I write this, we are viewed as representing you by your congressmen. That is critically important. You are a community leader with real, practical insight into the conditions and needs in each of the congressional districts. We are effective because a constituent banker community and political activism gives us credibility.

When the ATM bill goes to the Senate, it will face a more difficult challenge but there too, I think we’ll win. In the Senate, both Ohio Senators Sherrod Brown and Rob Portman have co-sponsored an identical bill. Ohio bankers worked and worked to get their support.

While this individual bill itself won’t solve many problems, I hope the story does make the case for the tangible benefit to your bank and community of your getting to know your legislators and regulators well. I believe it also provides evidence that you should never, never stop trying to win better laws (or rules).

If you were one of those that called, wrote, or visited. “Thank you.” You are the reason we are winning this fight. If you didn’t, consider that we may not be able to win the next one without your help. And as my story continues, I’ll tell you that we are in the middle of another with real significance.

Community Bankers Earlier in July a half dozen lawyers who are foreclosure experts convened in the OBL offices, a step in a process triggered by an Ohio banker who refused to accept without a fight law and regulation that was working very poorly.

This banker was First Community

Bank of Whitehall’s Roger Blair. First Community, like many of your banks, is facing an unprecedented number of seriously delinquent residential and commercial mortgages. And those delinquent loans were stacking up in a foreclosure log jam in the Franklin County court system.

Roger took responsibility for the process of better educating the OBL staff so we had intimate insight into the foreclosure impediments that were leading to increased losses for lenders and harm to communities statewide.

He helped us put together our first meetings with foreclosure legal experts and later with a common pleas judge.

Other bankers like Tom Moore (First Federal Bank of Ohio in Galion) and John Malanowski (First Federal Savings and Loan Association of Lorain) helped us persuade Governor John Kasich to establish a Financial Industry Advisory Council, made up of bank CEOs, most of them from community banks. The Governor left it to the council to identify areas the state could most help stimulate economic recovery.

One working group, chaired by Tom, focused on judicial and legislative improvements to the foreclosure process. It developed ideas, then took a broad outline to the Governor.

Commerce Director David Goodman, who oversees state chartered financial institutions, backed the group’s request telling the Governor that Ohio home prices could not begin recovering until the state dealt effectively with the foreclosure backlog. The Governor told his staff to come back to him with recommendations. His staff turned to us to find and develop solutions.

the Governor to take to the General Assembly. Our input will provide the foundation for their work.

Banker credibility got the Governor’s attention. Banker expertise will help forge solutions.

Our role in that work is far from over. OBL will to continue to support the Governor’s office to help make sure that the legislative initiative really does create benefit for Ohio. And we have been asked to expand our focus to include the Supreme Court and its mediation program as well as to enlist Attorney General Michael DeWine’s help. Ultimately, we will have what I hope will be a national precedent

setting bill through the Ohio General Assembly. We’ll need your help.

You are Responsible for Your Government Let me conclude by suggesting a common moral to each of these stories - achieving good, efficient government is a responsibility of every banker.

Persistence in the face of innumerable obstacles will pay off. It’s not someone else’s responsibility to fight this fight. It is yours and mine.

Forge Solutions The committee’s rough draft fed into July’s meeting of foreclosure legal experts. Its work last month refined our recommendations and added others.

The suggestions formed the agenda of a working meeting yesterday with Goodman and John Minor, the top advisor to the Governor on bankingrelated issues. That meeting ended with a commitment by the Governor’s staff to come up with legislation for summer 2012

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IN PICTURES

CEO Symposium

Continues to Hit Mark

The 2012 OBL CEO Symposium continued to make its mark as the OBL’s premiere networking event of the year. More than 160 bankers, executives and regulators were part of the record-breaking crowd at the 10th annual program, May 17 & 18 at The Hilton Columbus at Easton. As OBL Board Chairman Court Haning said in his opening remarks, “If ever there was a time when we as bankers need to understand how to adapt to ongoing changes in regulation and the economy, now is that time. And you have made the right next step by attending this program.” Haning also serves as president The Peoples National Bank in New Lexington.

David Horsager, M.A., president & CEO, Horsager Leadership LLC, kicked off the program with the Eight Pillars of Trust. He reminded attendees to stay fresh, relevant and capable – and that the best ideas often come from each other. Bankers at this event agree – networking at this annual program is tops and not to be missed. As Joe Bunke, president, Cincinnati Federal Savings and Loan Association, “This program offers opportunities for not only a learning experience, but good interchange with peers, as well.”

A highlight to the closing keynote lunch was the surprise presentation of the Lifetime in Public Service Award. Retiring CEO David Hehman, Federal Home Loan Bank of Cincinnati, was only the third person in OBL history to receive the award. Presented by FHLB board member man Mike Melvin, president and CEO of Perpetual Federal Savings Bank in Urbana, the award was given to “a man who has made a significant difference in the economy of Ohio.” Melvin continued, “Dave is a very modest man. I’ve never heard him make a self serving statement. That is one of the motivations frankly for the OBL to present this award. We wanted to make a clear public statement commending an extraordinary career. While Dave will not make this claim, we and most observers believe the Federal Home Loan Bank of Cincinnati has been the best run of all the banks in the system during his tenure.”

Upon taking the podium, David remarked, “You got me! I am stunned!” And while he was “floored by the honor”, he said, “Thank you to the Ohio directors for the work you do.

Any successes the Federal Home Loan Bank has had is a direct result of a great staff – and is reflected in what the FHLB can help you do in your communities.”

CEO Symposium sessions also focused on best practices to increase revenue, as well as the latest regulatory updates during the popular Regulatory Panel Discussion. Bob Harlow, president, 1st National Bank, noted, “I picked up some actionable strategies that will improve our profitability.” And Lloyd Johnson, vice president, First State Bank, said, “The content was relevant in today’s environment; and networking opportunities were great.”

SAVE THE DATE! The 2013 OBL CEO Symposium will be held Wednesday & Thursday, May 8 & 9, 2013 at the Hilton Columbus at Easton.

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Susan Poling OBL Education Manager

THANK YOU TO CEO SYMPOSIUM SPONSORS: KEYNOTE SPONSOR

Banc Consulting Partners, EVENT SPONSORS

OBL BankServices BKD LLP Crowe Horwath Gardiner Allen DeRoberts Keefe, Bruyette & Woods Ohio Capital Corporation for Housing Plante Moran Young & Associates, Inc.

Doug Naylor, The First National Bank of Blanchester, talks with Gary Sutter, employee benefits manager for the Ohio Bankers League Benefits Trust

Affiliate Member Todd Taylor, Taylor Advisors, and Bick Weissenrieder, The Hocking Valley Bank

Roger Blair, First Community Bank, and Dan DeLawder, The Park National Bank, find time for some conversation on day one

The Arlington Bank’s Tom Westfall with OBL President & CEO Mike Van Buskirk

Opening presenter David Horsager, whose keynote address was sponsored by Banc Consulting Partners, signs a book for vice president Julie Paxon, North Valley Bank

Ever-valuable Regulatory Panel Discussion on day one provides opportunities for Q&A from top regulators. Pictured: Stephen Jenkins, Federal Reserve Bank of Cleveland; Bert Otto, OCC; Chuck Dolezal, ODFI; and Anthony Lowe, FDIC. OBL’s Jeff Quayle, who moderated the panel, and OBL Board Chairman Court Haning are also pictured.

More than 160 bankers and industry executives attended the 10th annual CEO Symposium at The Hilton

David Hehman, retiring CEO from Federal Home Loans Bank of Cincinnati, and Mike Melvin, Perpetual Federal Savings Bank, are all smiles after the Lifetime Public Service Award was presented for the third time in OBL history at the closing luncheon

summer summer 2011 Ohioas Record Federal Home Loan Bank staff and board 2012 members, well 9 as several members of the Hehman family surprised David (center) at the award presentation prior to the closing keynote

OBL Investment Partnership an Easy Cure for Broker-Dealer Headaches

At first glance, the reasons to not wade into the fast evolving broker-dealer market seem to outweigh the potential positives. Broker-dealer start-ups require effort and personnel. Set-up can be laborious and time-consuming. Compliance and the constant back-and-forth communication with FINRA is just one extra regulatory headache, and we all have enough of them, right?

That is where the OBL’s partnership with Infinex Financial Group comes in. More than 14 banks across the state now use Infinex’s services to avoid all of the common pitfalls associated with starting a broker dealer operation. Infinex -- and OBL staffer, investments pro Michelle Crume -- harness the experience, expertise and vast industry contacts of the Infinex network to empower banks on the investment side of the business.

Created in 1993 by community institutions in Connecticut, Infinex is owned and governed by community banks and state banking associations. The unique feature is what sets it apart from its competitors. Its programs are aimed specifically at community banks and their customers. In fact, community institutions are the firm’s only customers.

One of the partnership’s oldest clients is Athens-based Hocking Valley Bank. Ohio Record recently sat down with the bank’s Chairman & CEO Bick Weissenrieder to get his take on the Infinex difference.

James Thurston Editor

In addition to its separate investments area, Hocking Valley Bank has pioneered a new open concept branch experience without the formal teller line

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Ohio Record: Tell us a little bit about your relationship with Infinex and the role you played getting the partnership off the ground?

Bick Weissenrieder: While Infinex is endorsed by many state associations around the country, Ohio is unique because when we endorsed them back in 2005 we became an equity owner and that gave us a seat on Infinex’s board. I currently fill that seat, so the association is involved in the decision making process.

I was on the OBL BankServices board of directors when we negotiated the original deal, and the benefits of a broker dealer which was owned and run by community bankers and state banking associations were obvious.

Ohio Record: As the bank’s president, what makes the program stand out?

Weissenrieder: The Infinex difference allowed us to start up and begin to build a program, lose our rep and resume building our program again five months later. The Infinex model allowed us to maintain our existing client relationships while finding our next generation rep. It would be very hard to justify a start-up operation without Infinex. It is, after all, the bank’s reputation and its relationship with our customers that will serve as the core of the broker dealer’s client base.

If we don’t have a system in place to help us get over the inevitable bumps in the road we could jeopardize not only newly-begun investment relationships but

Schmadel has worked with Infinex to develop digital marketing campaigns to promote the program

Hocking Valley Bank is a pioneer of the OBL/Infinex partnership

long-standing bank relationships as well.

The Infinex model, and Michelle Crume particularly, have allowed us to build a program from nothing while mitigating the risks to the bank. We believe we need to be able to offer our customers credible investment products and services in order to protect our basic banking franchise.

With Infinex we can do that. Without Infinex the risk would almost certainly have been too great.

Ohio Record: Tell us a bit more about the role Crume plays?

Weissenrieder: When we were ‘between reps’ Michelle even came down to the bank to serve our customers as our ‘de-facto rep’ during the transition. You can’t put a premium on that kind of service and it’s a massive insurance policy for a start-up operation. Then having Michelle there to support the new rep was a huge benefit.

Ohio Record: How does the relationship work as far as your customers are concerned? Are there ever concerns regarding taking business away from the banking side?

Weissenrieder: All of our investment customers are also bank customers and we ensure our rep is representing Infinex the way HVB wants to be represented. When Michelle recruited Kenna, she found someone who was a sharp investment pro, but who could also talk the talk on the banking side.

Kenna works closely with our bankers so there have never been any concerns about taking business away from them.

It’s more about complementing each other

and deepening the existing customer relationships we have. Those customers were going somewhere for investment services before we partnered with Infinex, so we thought, “Why not bring them to us?”

After all, if they were getting their brokerdealer services elsewhere they were probably experiencing other banks and there was a risk of losing the relationship altogether at some stage down the road.

At the end of the day it’s about doing what’s best for the customer and we feel the partnership with Infinex plays a big role in that.

Ohio Record: Does Infinex’s training help in that area?

Weissenrieder: Yes, Infinex has done a lot of training with our front-line personnel to help them recognize where it makes sense for the customer to look at diversifying into products other than CDs or to refer them to Kenna.

Ohio Record: Has fee-income from the program met your expectations?

Weissenrieder: The economy has affected the investment business everywhere but considering the environment we’re in, we’re doing very well.

Ohio Record: Anything else you would like to add?

Weissenrieder: The kind of service you get from Infinex as a community bank is unparalleled. The larger firms out there might not give that kind of personalized service unless they were doing a huge number in terms of annual production. We are very happy with the partnership.

Hocking Valley Bank CEO Bick Weissenrieder joins the OBL’s Michelle Crume, Investment Rep Kenna Miller and HVB Marketing VP Donna Schmadel

The Infinex Difference The OBL’s partnership with Infinex to make investing simple, convenient and results-driven for member banks’ customers.

Infinex was formed by state banking associations and community banks and operated for the benefit of the participating banks. The OBL’s partnership with Infinex provides a successful working template to bring the worlds of banking, investments and insurance together while avoiding a competitive environment in which banks find themselves competing against their primary business partners.

Whether you are a self directed brokerage program or full service brokerage, insurance and financial planning services, this customized, turnkey program can ensure a successful, profitable business line is in place. Contact OBL VP/Infinex Regional Director Michelle Crume at (614) 340-7622 to find out more.

Securities offered through Infinex Investments, Inc. Member FINRA/SIPC

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HOW TO

Systematize Your Sales Culture Every financial institution has systems in place for balancing at the end of the day, processing loans, handling safe deposit boxes, and running the other fundamental aspects of their bank. Yet, most bankers have no system whatsoever for sales and planned growth—when these activities are also amongst the critical underpinnings of a well-run, well-managed institution.

Research done by our firm revealed that 95 percent to 98 percent of the rate inquires that came into banks and credit unions received no offer of help, but merely a quote of rates and an occasional “thank you for calling.” Additionally, new accounts people are lucky to get an order for a single product when they think that selling a checking account means showing a brochure and having the customer pick out a product. Even more rare is an attempt to become the only financial institution the customer needs by delving deeper into finding what other needs they may have.

Lenders are asked to make sales calls with little to no instruction on what they can do to dramatically improve the effectiveness of those calls. Lenders drop in at a prospect’s business and chat, have no process for the call, do not have a commitment objective for the call, do not record the call in a database for a

systematic personalized mailing or follow through, or apply other standard sales and marketing methods. When the lender moves to another job or position, there is no record of whom he or she has prospected, what services that prospect needed, where they currently do business, how interested they are or what their hot buttons are.

When putting together your sales system, understand that your first attempts will have long lasting results—so thinking about the information you need and how you will use it is critical.

Here are some issues you should consider prior to constructing a sales system:

Keep It Simple I often say the biggest detriment to my career is all the “stuff” I learned in graduate and undergraduate business school. You would think you would have to do logarithms and calculus to make it in business. In my years of being a commercial loan officer, stock broker and starting a bank or my own business, I have yet to have a problem stare me in the face where I said, “If only I could just apply more calculus!” The same holds true with many of the complex business models we spend time and money on—when the simplest things aren’t getting done. I’m

DON’T MISS ROXANNE EMMERICH AT THE OBL ANNUAL MEETING Join us in Columbus on Nov. 8. Keynote speaker Emmerich will give Ohio bankers the inside track on What Top Performing Banks “Get”: Five Steps that Transform Bank Results FAST.

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Roxanne Emmerich The Emmerich Group

always amazed when banks tell me they just spent $50,000 to $500,000 doing a marketing study. Imagine if they had spent that money training their people on how to turn inquiries into business instead.

Instead of focusing on the esoteric, how about picking the low fruit on the vine?

You may not sound as sophisticated at cocktail parties, but you’ll make much more money.

So in the hectic day, think what really needs to be done and do that only. The extras often are dropped as people get busy. An example of a simple system is that all rate inquiries will be asked at least two questions from a list of 10 well designed questions. All inquiries would be asked for their name and address so you can include them in your database. Offer them something in return. Code each entry in the database for future business potential with a choice of no more than 5 codes based on strict criteria. Send an immediate follow-up mailing piece that same day and a follow-up with a letter within one week.

Code for monthly, quarterly, or yearly follow-through based upon the quality of the lead.

Make It Sequential Understand that sequential systems get followed. Flow-chart a sequence for how a rate inquiry goes from initial call, to mail

piece, to referral to a financial consultant, to cross-selling, to thank you mailing following the opening of an account, to — finally —a 90-day, 7-step boding and upsell program.

Script Your Sales Presentations The ideal flow of a sales presentation is based on the psychology of the buying cycle. Realize that research shows buyers want information given to them in a certain order. If you go out of order, you risk losing the sale.

For instance, buyers want to feel a human connection before they want to proceed. Then they prefer to be questioned about their needs before they want to hear the shtick about how wonderful you are.

Discuss who you are as an organization before mentioning information about your products. Price shouldn’t enter into the conversation until the end and right before asking if they want to proceed.

Explain the fees, costs, rates. Even though you earned their trust, they still need to know the rates. The only difference

is that you went through five steps before we got there.

The only closing question anybody should ever have to ask is, “Do you have any other questions, or would you like to get started?” If you’ve done all the previous correctly, there is no need to manipulate someone with the slimy and manipulative closes that many sales courses teach like: The alternative close, “Would Monday or Tuesday be better for you.” Or the last chance close, “This rate changes next week. You better start now.” Customers are far too sophisticated to accept a used car sales approach from their financial institution.

Contrast this approach to the typical.

“Here’s our brochure. Waddaya want?”, that is the norm in financial consulting.

Create a System for Each Product or Service

deposit; and other standard sales situations.

Sales systems aren’t rocket science, but sometimes it seems it must be based on the number of financial institutions that are still letting well over 90 percent of their inquiries go on to the next call for rate because their people are not adequately educated to handle inquiries.

Why not sit down and create your sales systems today?

Roxanne Emmerich, CSP, CMC, CPAE has consulted with half of the top 5 percent performing banks and helps community banks incorporate highperformance internal cultures, profit-rich marketing systems and premium-priced sales processes.

Emmerich will present the keynote address at the Ohio Bankers League annual meeting covering the five steps that transform bank results in Columbus on Nov. 8. Available free to bank executives is Roxanne’s “The New Game Of Banking,” detailing the 15 essential rules of the game that will grow your bank with core deposits, A+ credits, and premium pricing. Visit http://EmmerichFinancial.com.

You should set up systems for phone rate inquires; commercial, consumer and mortgage loan inquires; officer calls; checking account inquires; certificates of

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MANAGING COMPLIANCE RISK

CFPB Working on a Wide Range of Issues Last issue we introduced the new player in the regulatory field, the Consumer Financial Protection Bureau, an agency with broad powers and little accountability.

As we discussed last time, the CFPB has a lot on its plate with responsibility for a number of the key federal consumer protection laws that were transferred from other agencies.

The agency hit the ground running last summer and has issued interim final rules, proposed rules, examination procedures, requests for comment, and more. Among this flood of issuances, a few stand out.

Unified Mortgage Disclosures One of the most challenging tasks put to the CFPB by the Dodd-Frank Act, which also created the agency, is to merge the disclosures required for mortgage loans by the Truth in Lending Act, implemented

by Regulation Z, and the Real Estate Settlement Procedures Act. The agencies formerly responsible for these rules, the Federal Reserve Board and the Department of Housing and Urban Development, had attempted to merge these disclosures several years ago.

However, those agencies concluded that statutory changes were needed first. The DFA ordered the CFPB to integrate these disclosures.

The CFPB has gone through several rounds of proposed disclosures, requests for comments on the models, consumer test groups, and so forth to arrive at a set of proposed disclosure forms. These are now out for comment, along with proposed rule changes to implement the new forms and to make some basic changes to how disclosed terms are calculated – such as to include pretty much all fees in the

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finance charge (and, thus, in the annual percentage rate).

Senior Financial Exploitation The DFA also requires the CFPB to facilitate the financial literacy of senior citizens, individuals aged 62 or older, on protection from unfair, deceptive, and abusive practices and on current and future financial choices.

Therefore, the CFPB’s Office for the Financial Protection of Older Americans is seeking information on consumer financial products and services, financial literacy efforts, and fraudulent or deceptive practices that impact the lives of older Americans and their families.

As part of its mandated functions, the Office for Older Americans will monitor certifications or designations of financial advisors who serve seniors and alert the Securities and Exchange Commission and state regulators of certifications or designations that are identified as unfair, deceptive, or abusive. The Office for Older Americans will also make legislative and regulatory recommendations to Congress on best practices for disseminating information to seniors regarding the legitimacy of certifications and designations, and methods through which a senior can identify the financial advisor most appropriate for the senior’s needs.

This office is also conducting research to identify best practices for educating seniors on personal finance management.

The Office for Older Americans intends to use this research to develop goals for programs that provide financial literacy and counseling to seniors.

To meet this responsibility, the CFPB is seeking comments in response to a

William J. Showalter, CRCM, CRP Senior Consultant; Young & Associates, Inc.; Kent, Ohio

series of questions grouped into various categories: • Evaluation of senior financial advisor certifications and designations • Providing financial advice and planning information to seniors • Senior certification and designation information sources • Financial literacy efforts, and • Financial exploitation of older Americans, including veterans of the Armed Forces

Consumer Use of Reverse Mortgages On another topic that impacts seniors more than other consumers, the DFA required the CFPB to conduct a study on reverse mortgage transactions, which it published in a June 2012 Report to Congress.

The CFPB also has authority to implement regulations on reverse mortgage transactions. Specifically, it has authority to implement federal consumer financial laws, including the TILA and RESPA, which already impose requirements on reverse mortgage transactions. Further, the DFA specifies that the CFPB’s regulations of reverse mortgage transactions may identify any practice as unfair, deceptive, or abusive, and may provide for an integrated disclosure

standard and model disclosures.

The study identified four major topics where the CFPB believes that additional research would help determine if additional consumer education or regulatory action is needed. The CFPB seeks information that will enable it to better understand and evaluate potential consumer protection issues raised by reverse mortgages and the shopping process, and asks for input from the public on the following reverse mortgage topics: • Factors influencing consumer decisions • Consumer use of reverse mortgage proceeds • Longer-term outcomes of reverse mortgages, and • Differences in market dynamics and business practices among the broker, correspondent, and retail channels

borrowers of private education loans (PELs).

Among other things, the act directs the ombudsman to “compile and analyze data on borrower complaints” regarding PELs and make appropriate recommendations to the CFPB Director, Treasury Secretary, Education Secretary, and Congress. In March 2012, the CFPB began accepting borrower complaints on PELs. To compile and analyze data on complaints processed through other mechanisms, the ombudsman seeks information on borrower complaints about PELs. The CFPB requests information from the public, related to PELs, from the following entities: • Institutions of higher education’s financial aid offices • State attorneys general • State and local banking and consumer protection agencies

Complaints from PEL Borrowers

• Borrower advocates and legal aid entities

The DFA established a Private Education Loan Ombudsman within the CFPB to provide timely assistance to

• Complaint resolution departments of lenders and servicers, and • Other interested parties

The CFPB is particularly interested in receiving comments that could bear on its analysis of data regarding borrower complaints. The CFPB is therefore interested in responses to a number of questions regarding the types and sources of complaints received, complaint outcomes, and complaint investigation and resolution mechanisms that are in place at schools, lenders, and other governing agencies.

The issues outlined here are just the tip of the iceberg of what the CFPB is working on. We will see many more requests for comment and other input, proposed and final rules, studies, and so forth from the “new kid” in Washington as time goes on.

William J. Showalter, CRCM, CRP is a Senior Consultant with Young & Associates, Inc. (www. younginc.com), with over 25 years experience in compliance consulting, advising and assisting financial institutions on consumer compliance and compliance management issues. He also develops and conducts compliance training programs for individual banks and their trade associations, and has authored or co-authored numerous compliance publications and articles. Bill can be reached at (330) 678-0524 or wshowalter@younginc.com.

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Public Eye

By James Thurston, Editor

OBL FIGHTS FOR INDUSTRY’S IMAGE IN MEDIA Image management has topped the agenda in the first half of 2012, as the OBL worked with journalists to counter misconceptions and defend attacks on banks in Ohio.

In a recent Financial Times Agenda article on the burdensome affects of Dodd-Frank, OBL President Mike Van Buskirk commented, “If you’re a huge organization, all of these requirements are still burdensome, but compare that to a small community bank How are they going to be able to keep up? Some of our banks have only 10 employees.”

In a Columbus Dispatch article on increasing regulatory costs and how they relate to banks’ income, OBL spokesman James Thurston commented, “When the cost of doing business has increased to the point we’ve seen today, it’s making the decision difficult to pass costs on or not.” Thurston added, “As revenues go up, costs are going up and the margins are getting squeezed.”

In a Columbus Business First article on Basel III mission creep, OBL President Mike Van Buskirk commented, “Obviously, adequate capital for community banks is important, but there was nothing in the crisis to suggest to me that there were inadequate capital requirements for community banks (in the first place).”

In a Crain’s Cleveland Business article discussing how Ohio banks are adding to commercial lending operations, OBL Communications Manager James Thurston commented, “Fifth Third is one of many banks, big and small, beefing up commercial lending teams. The banks are … anticipating continued improvement in the economy.”

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TAX PROPOSALS HIGH ON NEWS AGENDA The Governor’s bank tax proposals also dominated the news agenda for most of the quarter. But the issue was not clear cut and the OBL worked hard to ensure the press understood all of the nuances.

In a Cincinnati Enquirer article on Gov. Kasich’s tax proposals, OBL President & CEO Mike Van Buskirk noted that the existing tax code -- and the new proposals -- unfairly penalize mutuals. He commented, “Mutuals are typically required by regulators to hold more capital than stock companies. Ohio’s tax on capital ... penalizes banks with more capital. I’d like them to pick a ceiling, so they don’t penalize mutuals.”

In an American Banker article, Van Buskirk added, “We need to get this right, for sure. Naturally, we need to vet the language (in the bill) to make sure there are no unintended consequences.”

But the OBL was also able to put the spotlight on some of the positive things banks are doing every day to help customers. In a Dayton Daily News article on innovative banking practices, OBL Spokesman James Thurston referred to the move toward a more retailcentric customer experience, commenting, “As banks are looking for ways to make the banking experience more convenient for the customer, you are going to see more of this.” Thurston discussed how banks are improving customer relations by offering other services not traditionally associated with financial institutions, like investments and securities.

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Ce r t i fi e d P u b l i C ACCo u n tA n t s A n d Co n s u ltA n t s

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Choice of Charters One of the unique characteristics of the banking business is that bankers have choices when it comes to bank charters.

Choices between federal and state bank and thrift charters and choices regarding Federal Reserve membership have historically involved differences not only in powers, obligations, governance and products, but which and how many regulators oversee the institution and the direct and indirect cost and expense involved in that oversight. The concept of a “dual charter” system has been in place for a long time, and provides for choice, diversification and decentralization of authority and oversight among state and federal regulatory agencies. As noted in the FFIEC Statement on Regulatory Conversions issued on July 7, 2009 (FIL-40-2009), “financial institutions may choose to operate under the state or federal charter that best accommodates their legitimate business and strategic needs.”

While all institutions should periodically review whether their charter is appropriate for their current and prospective needs, with the demise of the Office of Thrift Supervision (OTS) effective July 21, 2011, it may be especially timely for banks and thrifts to consider the best type of charter for the activities they presently conduct or anticipate conducting in the future based, as noted, on their “…legitimate business and strategic needs”.

The Dodd-Frank Act transferred certain powers and duties of the OTS to other federal regulators effective July 21, 2011.

As a result, the Office of the Comptroller of the Currency (OCC) now has supervisory and rulemaking authority over federal thrifts and the Federal Reserve now has supervisory authority over savings and loan

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holding companies. OTS authority with respect to state thrifts was transferred to the FDIC. The Act does not eliminate the federal thrift charter.

A significant degree of uncertainty remains with regard to this transition, especially with respect to post-transition implementation and post-transition regulatory oversight. Irrespective of the technical “rules of engagement”, how thrifts perceive their treatment in the examination and enforcement process on a posttransition basis will provide a real indication of the actual impact on the operations of federal thrifts.

While the differences between charters may seem insignificant at first, they can and do result in different strategic organizational paths and operating environments for the institutions involved. Review and consideration of the most optimal operating charter for an institution should be a continual item for board consideration.

There is presently a virtual regulatory “moratorium” on de novo charters, and a formal “moratorium” on charter conversions was imposed by the FFIEC (FIL-40-2009) for proposals to convert charters when “… conversion requests are submitted while serious or material enforcement actions are pending … “.

Dodd-Frank formalized a prohibition on conversions, subject to certain limited exceptions, when an institution is subject to an enforcement action initiated by its primary federal regulator In all instances, institutions will encounter a de facto “moratorium” when the obvious intent is “regulatory arbitrage” reinforcing a “no place to hide” policy for troubled institutions.

An article in The American Banker

Jeffery E. Smith Partner, Vorys, Sater, Seymour & Pease LLP

(Editor at Large; Oct. 26, 2011) points out that there is a significant trend of conversions from federal to state charters in the community bank segment that has become evident over the past two decades, which appears to perhaps be accelerating. The article cites concerns regarding a banker-perceived “one-size-fits-all” approach by the OCC, and a perceived greater understanding of local conditions by state regulators. The article also cites a perceived banker preference for Federal Reserve membership and supervision as opposed to non-member status for state banks (which results in the FDIC being the primary federal regulator for supervision and examination purposes). In terms of overall aggregate assets under supervision, however, the national bank charter clearly leads.

Converting for the “right reason” is always the primary consideration.

“Regulator shopping” doesn’t fool anyone, especially the regulators. However, there are legitimate business and cost reasons to consider choice of charter, which can make a significant business difference to bankers and their shareholders. And sometimes, particularly after there have been significant and continuing relationship “issues”, it may make sense to change to gain a fresh perspective.

Please note that, for Ohio-chartered institutions, the following is subject to a general caveat that Ohio state bank and thrift laws and regulations are presently undergoing a comprehensive review and analysis through a project initiated by the ODFI, OBL and industry representatives. Goals of the project include simplification of the Ohio banking code, enhancing access to capital and appropriate business opportunities for Ohio charters, and elimination of most if not all statutory differences between state bank, thrift, and savings bank charters consistent with safe and sound operations of the institutions.

Natural and appropriate differences will likely remain with regard to organizational structures and governance rules between stock and mutual organizations, however certain complex and perhaps antiquated operating restrictions presently in place for thrifts and savings bank may be removed. In that light, there will likely be further important considerations for those currently in the thrift and/or savings bank business in the event that the statutory changes are adopted and implemented. The timeframe for finalization of the comprehensive recodification initiative is not definite at the present time.

So what’s available now and what are the differences?

1. STATE MEMBER BANKS The chartering entity for state member banks in Ohio is the Ohio Division of Financial Institutions (ODFI), a division of the Ohio Department of Commerce.

The ODFI charters and regulates Ohiochartered banks, savings banks and thrifts, and has some input and examination authority for matters involving bank holding companies that control Ohio-chartered banks. It also charters and regulates statechartered trust companies and has some regulatory authority with respect to outof-state trust companies operating in Ohio.

State-chartered banks can be “members” of the Federal Reserve, which requires investment in Fed stock in an amount equal to 3 percent of capital with another 3 percent on call. The Fed stock investment presently returns a 6 percent dividend. Being a “member” of the Federal Reserve System provides that the FRB is the “primary federal regulator” for state member banks, although certain FDIC rules also apply because all Ohio banks and thrifts are required to be FDIC-insured.

Therefore state member banks deal with two bank regulatory agencies (one state

and one federal) in their day-to-day business and examinations. Both the ODFI and their federal counterparts endeavor to coordinate examination processes to the greatest extent possible to attempt to minimize the burden on their institutions. State member institutions with holding companies have Fed supervision at both the bank and holding company levels.

In Ohio, it is worth noting that the ODFI combined bank and thrift examination staffs several years ago to provide uniform examination despite the underlying different types of charters. For the past seven years their examination staffs have been composed of a mix of both traditional thrift and traditional commercial examiners leading to a broader general understanding among all of the examiners with respect to the underlying business, operations and issues facing both types of charters.

Current law and regulation provides that the ODFI has important rule-making authority that can provide parity with OCC regulation and regulations of other states to provide competitive equality for Ohio-chartered financial institutions.

Generally, assessments by state regulators tend to be lower than their federal counterparts. In Ohio, annual assessments charged to state banks by the ODFI are presently around 40 percent of that charged to national banks by the OCC. Both have significant surcharges for 3, 4 and 5-rated institutions.

2. STATE NON-MEMBER BANKS Basically the same applies to state nonmember banks, except that their “primary federal regulator” for supervisory purposes is the FDIC. Most federal agencies strive for consistency in regulation through the FFIEC and other joint rule-making authorities. State non-member banks are examined by the ODFI and the FDIC. 3. NATIONAL BANKS The OCC is the chartering agency and “primary federal regulator” for national banks. National banks are “automatically” Fed member institutions by virtue of their charters. As a result, national banks are examined by a single federal agency. However, if a holding company is also involved, the Fed has examination responsibility for the holding company.

As FDIC-insured institutions, however, certain FDIC rules also apply. One of the

differences between national banks and state banks in the examination area is that the OCC can (and does) draw examination field staff from across the country that can sometimes result in more frequent changes in examination staff, which in turn can impact the ability of the examination staff to develop and retain an underlying knowledge and understanding of the particular institution, its management, customers, market and culture. Some argue that, as a result, the OCC has more of a “one-size-fits-all” approach, while others believe that the national scope provides a broad examination perspective so that OCC examiners can bring ideas and insights from other OCC districts to the banks they examine in Ohio.

4. FEDERAL THRIFTS With responsibility for enforcement of OTS rules and regulations having shifted to the OCC, there remain some questions as to the impact of retaining a federal thrift charter or electing to convert to a federal thrift charter. The OCC has been conducting workshops across the country in an effort to quell concerns voiced by some federal thrifts regarding the impact of the new regulatory structure and OCC examinations. Until more time passes to determine the long-term effect of this significant change, the impact of converting to a federal thrift charter remains somewhat uncertain.

5. STATE THRIFTS State savings associations are presently regulated by the ODFI in Ohio and, after July 21, 2011, the FDIC. Interestingly, the Act provides for the transfer of supervisory authority, but not rulemaking authority, to the FDIC. Rulemaking authority has been transferred to the OCC. The outcome is uncertain at the present time.

6. STATE SAVINGS BANKS State savings banks are somewhat unique charters that are a hybrid of state commercial banks and state thrifts. Holding companies can be either bank holding companies or thrift holding companies, depending on the business conducted by the savings bank.

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Choice of Charters has been changed from the OTS to the FDIC. In Ohio, the impact of the pending recodification initiative may also have a profound impact on charter choices with regard to state thrifts and savings banks.

7. STATE NON-MEMBER BANKS As noted previously, bank holding companies and financial holding companies will continue to be regulated by the Federal Reserve, as will thrift holding companies following elimination of the OTS. Mutuals and mutual holding companies have special considerations when it comes to conversion alternatives, but it is presently unclear with respect to mutual charters and mutual holding companies what changes may evolve. Formation of holding companies may provide activity and investment alternatives for institutions, as well as tax advantages in Ohio.

8. OHIO PARITY RULES

AND PREEMPTION Under current Ohio law, and as anticipated under the pending recodification initiative, the superintendent has authority to grant Ohio-chartered institutions the same or similar rights, powers and privileges as federally chartered institutions, state-chartered institutions from other states doing business in Ohio, and other financial services providers. Historic federal preemption rules and authority for national banks and federal thrifts are somewhat unclear at the present time as a result of Dodd-Frank, and institutions with significant non-Ohio lending activities will need to analyze the impact of a charter change on their banking activities, particularly in the consumer lending area.

9. TRUST POWERS Both Ohio and the OCC provide for the ability of banks and thrifts to exercise trust powers directly and/or through joint ventures, and both provide for the establishment of pure trust companies. Special rules apply to state savings banks.

10. OTHER NON-BANK ACTIVITIES Both Ohio and the OCC provide for limited ability of banks and thrifts to act as agent in the sale of insurance and securities

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products and to engage in limited real estate activities. Certain non-bank activities conducted by state banks and thrifts are subject to approval by the FDIC. Non-bank activities are also subject to “subject-matter jurisdiction” oversight by appropriate non-bank regulators, such as the Ohio Department of Insurance for insurance matters and the SEC and FINRA for securities activities.

Changing Charters Charter change considerations include direct and indirect costs and expenses of the conversion process, including legal and other professional fees, signage, document and stationary changes. Those considerations tend to be relatively minor, however, in light of considering what is the best charter alternative to accomplish the long-term goals of the institution.

Conversions can occur through a number of legal and regulatory mechanisms.

In all instances, the converting bank or thrift can expect a thorough “physical” by the proposed new chartering authority, in consultation with the current chartering authority, before acceptance.

A perceived disadvantage for federally chartered institutions considering converting to a state charter is that the bank will be examined by two agencies; the state and the Federal Reserve in the case of member banks, or the state and the FDIC in the case of non-member banks. However, institutions that have holding companies and choose Federal Reserve membership will still have only two regulators, the state and the Federal Reserve. In those instances, the Federal Reserve will substitute for the FDIC and the OCC/OTS in the event of a conversion, and the Federal Reserve is already involved due to the holding company relationship.

As noted previously, “functional” regulators, such as the SEC for securities activities and state insurance departments for insurance activities, will continue to have supervisory authority for certain non-bank activities under the Graham-Leach-Bliley Act, irrespective of the bank charter.

In all instances, institutions considering a charter change must carefully weigh

and consider these alternatives and the impact of the alternatives, and be certain to develop a viable business rationale to support their decision and document that process at the board level.

No “One Size Fits All” As with most such significant issues, while some of the considerations are similar there is no “one size fits all” in terms of the outcome. Institutions must consider which charter is right for their current and long-term strategic objectives, and which affords the institution and its constituencies the most favorable environment in which to operate and to reach their institutional goals. Converting institutions should expect a certain level of skepticism with regard to motivation if there are existing or pending problems (irrespective of whether there is an active enforcement action), and always a thorough examination by the new chartering agency before approval. Certainly direct cost is a factor, but so is accessibility, consistency, continuity, examiner quality and cooperation.

Each charter type has positives and negatives, and while one type of charter may have been appropriate at the time it was first adopted, perhaps times and situations have changed or are likely to change, making it prudent to conduct an examination of whether a charter change may be appropriate and beneficial. Some have adopted certain charters because management and/or the board had familiarity with that type of charter, but the situation may have changed due to any number of factors from growth and stock liquidity issues to personality issues with the examination and oversight staffs.

Careful and thorough consideration (and documentation) of the pros and cons of the various charter types should be undertaken by institutions and their boards in light of their current needs and business, and in light of their strategic direction, before deciding which charter best fits their business profile and strategic needs.

After more than 40 years in EFT, our commitment may be the only thing that hasn’t changed.

The EFT industry has undergone a remarkable metamorphosis since the late sixties. At Elan, we’ve been there from the beginning, pioneering products and solutions that make our clients more profitable. And while our approach has evolved, our ability to support your success has remained the same. With the strength and stability of U.S. Bank behind us plus the most seasoned professionals in the business, we simply do EFT better than anyone else. Put our success to work in your organization. To set up your informational meeting, contact us at 1.800.343.7064 or information@elanfs.com.

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OBL Joint Convention, Memphis, Sept. 6-9

LESSONS IN

LEADERSHIP Welcome to Being a thoughtful leader means looking both inward and outward for answers, whether you’re trying to address a general problem like surviving the recession or a smaller, specific one like setting competitive rates. It is a journey of discovery that comes through a deep understanding of yourself as well as a clear appreciation of the whole.

This Fall, more than 300 banking industry execs will travel to the venerable Peabody Hotel in Memphis for the annual joint convention of the Ohio Bankers League and the Illinois League of Financial Institutions. The “River City” will provide a spectacular and fun backdrop for lessons in leadership – individuals, companies and case studies from which participants can glean valuable insights. Join us and continue your leadership journey this Fall in Memphis for this unrivaled knowledge gathering and networking opportunity.

Melea Wachtman OBL Senior Vice President of Administration

CONVENTION SCHEDULE AT A GLANCE Thursday, September 6 11 a.m. – 5 p.m.

12 – 1:30 p.m.

1:45 – 4:45 p.m.

5 p.m.

5:30 – 6:30 p.m.

6:30 p.m.

Convention Registration Convention Kick-off Luncheon Concurrent Breakout Sessions Peabody Duck Procession Welcome Reception in the Exhibit Hall Financial Services Expo & Silent Auction Bidding Dinner on Your Own

Friday, September 7 7:30 – 8:30 a.m.

7:30 a.m. – Noon 8:30 – 10:30 a.m.

10:45 a.m. – Noon 9 a.m. - Noon 12 – 2 p.m.

2 – 9 p.m.

9 - 11 p.m.

Breakfast in the Exhibit Hall Financial Services Expo & Silent Auction Bidding Opening General Session Concurrent Breakout Sessions Spouse/Guest Program ILFI Annual Meeting or Lunch on Your Own Optional Activities & Dinner on Your Own Silent Auction & Desserts Reception

Saturday, September 8 7:30 – 8:30 a.m.

7:30 a.m. – Noon 8:30 – 9:45 a.m.

10 a.m. – Noon Noon – 7 p.m.

1 – 6 p.m.

5 p.m.

6:30 - 10 p.m.

Breakfast in the Exhibit Hall Financial Services Expo Concurrent Breakout Sessions General Session Optional Activities & Lunch on Your Own Joint Convention Golf Outing Mirimichi Championship Course Peabody Duck Procession Chairmen’s Reception & Closing Banquet

Sunday, September 9 – Convention Check-out

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CONVENTION

ABOUT OUR FEATURED SPEAKERS The Blind Side – Michael Oher’s Inspiring Journey Leigh Anne Tuohy It’s a true story that inspired a best-selling book and an academy winning film, The Blind Side. But it all began by chance, on a blustery November day in 2002 when Leigh Anne Tuohy took in a homeless Memphis teenager, who would find his calling and become a football superstar. The Tuohy family didn’t simply adopt Michael Oher, they engulfed him in familial love that has changed lives exponentially. So what led this wealthy wife of an entrepreneur to make a home for Michael Oher that couldn’t have been further from where he grew up? Learn what drives this inspirational matriarch of the Tuohy family and how she continues to motivate others through her New York Times bestseller, In a Heartbeat: Sharing the Power of Cheerful Giving, and The Making it Happen Foundation a charity she established to promote awareness, provide hope and improve standards of living for all the children fighting to survive in the invisible cracks in society.

Enterprise Risk Management: A Practical “CAMELS+ Based” Approach Scott Polakoff, Executive Managing Director, FinPro, Inc. ERM is the process of identifying measuring, monitoring and controlling all risks in a given entity. Many banks have some form of risk assessment, but the various risks are often modeled and analyzed in silos. ERM brings all of the risk assessments under one common umbrella, with one process and one model. Former senior bank regulator and a long-time industry friend Scott Polakoff takes a closer look at this holistic approach to risk management.

Next Generation Fraud Schemes: New Risks for Banks and their Customers Jack Vonder Heide, President, Technology Briefing Centers, Inc. 2011 brought high unemployment, a struggling economy and in increase in fraud. 2012 will bring unprecedented challenges as sophisticated new schemes target banks and their customers. In this informative session, technology guru Jack Vonder Heide discusses the very latest financial fraud techniques and the steps banks must take to minimize exposure and preserve shareholder value.

The Road to 2012 Mark Halperin, Senior Political Analyst, MSNBC and Time Magazine and Co-author, Game Change With a Republican House and a Democratic Senate, what is Obama’s legislative strategy for 2012? How do senior strategists in both parties see the political landscape and what lies ahead in the 2012 race for the White House? And how will all these story lines converge and interact tomorrow and in the future? Mark Halperin uses his more than 20 years of experience covering national politics and government to explain it all with insight, wit, insider knowledge and no punches pulled.

With an eye on what the latest political maneuvering means for big business, international relations, the American economy and the average citizen, Halperin weaves behind-the-scenes anecdotes about the top players in American politics with his trademark rigorous analysis of policy, politics and the media.

Inside the Beltway: A Washington Perspective Frank Keating, President & CEO, American Bankers Association Frank Keating is president and CEO of the American Bankers Association.

Keating became ABA’s president and CEO on January 1, 2011, following seven years of service as the president and CEO of the American Council of Life Insurers, and after serving two terms as Oklahoma’s 25th governor.

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SPECIAL EVENTS & OPTIONAL ACTIVITIES KICK-OFF LUNCHEON AND BREAKOUT SESSIONS Plan to take advantage of these additional learning opportunities. There are more breakout sessions offered than ever before.

CONVENTION KICK-OFF LUNCHEON Whatever Happened to High Performance?

Jack R. Salvetti, President, S.R. Snodgrass, A.C.

Spouse/Guest Program St. Jude - Finding Cures. Saving Children.

Friday, Sept. 7, 9 a.m. – Noon Celebrating its 50th anniversary this year, Memphis-based St. Jude Children’s Hospital is unlike any other pediatric treatment and research facility. Discoveries made here have completely changed how the world treats children with cancer and other catastrophic diseases. With research and patient care under one roof, St. Jude is where some of today’s most gifted researchers are able to do science more quickly. Join us as we go inside and explore first-hand this amazing facility.

CONCURRENT BREAKOUT SESSIONS Your Bank has Survived the Economic Crisis; Now Plan to Help Your Bank thrive in the “New Normal” Jim Kleinfelter, President & Senior Consultant, Young & Associates, Inc.

Raising Capital in this Environment – What Works; What Doesn’t; and How to Go About It Jerry Buckley and David Baris, Partners, BuckleySandler

Branch Purchase and Sale Transactions: A Primer for Bankers

Jeffery Smith, Partner, Vorys Sater Seymour & Pease Charles Crowley, Managing Director, Paragon Capital Group LLC

Rock ‘n’ Soul Museum & Gibson Guitar Factory Tour Friday, Sept. 7, 2 – 5 p.m. - $35 per person

Leadership & Succession Planning: A Model for Success

One of the few Smithsonian museums outside of Washington D.C., the Memphis Rock ‘n’ Soul Museum tells the story of musical pioneers who, for the love of music, overcame racial and socio-economic barriers to create the music that shook the entire world. Located just across the street is the Gibson Guitar Factory where you’ll get an intimate look as Gibson’s skilled Luthiers craft some of the finest guitars in the world.

Alan J. Kaplan, President & CEO, Kaplan & Associates, Inc.

Finding Balance in the Perfect Storm Steve Twersky, CPA, Senior Vice President, FTN Financial Capital Markets

IT Risk Management – Preparing for the OCC Bradley Fenster, Senior Risk & Compliance Manager, Compushare

Emerging Issues in Director Liability

Brent McCauley and Scott Porterfield, Partners, Barack Ferrazzano Financial Institutions and Litigation Group

Preparing for Your Next Regulatory Exam – Current Examiner Issues and How to Avoid/ Handle Problems Susan Zaunbrecher and Mike Dailey, Partners, Dinsmore & Shohl

New Technology Approaches to Bank Operations Dennis Moore, Solutions Specialist, COCC, Inc.

Sun Studio Tour Friday, Sept. 7, 2 – 3:30 p.m. - $45 per person In 1953, an 18-year-old Elvis Presley walked into this Memphis recording studio with a cheap guitar and a dream. Nervously,

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CONVENTION

he sang a demo song, failing to impress record producer Sam Phillips. A year later at this same studio he would record an old blues song that would launch his historical career. Truly the birthplace of Rock n Roll, the studio was restored to its original character in 1987 and today chronicles the legendary bluesmen who recorded their first records there.

Shhh . . . It’s a Silent Auction Friday, Sept. 7, 9 - 11 p.m.

Get ready to tap into the excitement and support the grassroots initiatives of Ohio BankPac and ILFIPEC. Auction items will be on display in the Financial Services Expo beginning Thursday with final bidding at the Dessert Reception on Friday. To donate an auction item contact: Jeff Quayle at (614) 340-7603 or jquayle@ohiobankersleague.com; or Jay Stevenson at (217) 522-5575 x212 or jstevenson@ilfi.org.

Convention Golf Outing Mirimichi Championship Course Saturday, Sept. 8, 1 p.m. (Shamble Format) $125 per person Owned by Justin Timberlake, Mirimichi is considered the most ecologically-friendly course in America. It was the first course in North, South or Central America to become Golf Environment Organization (GEO) Certified. Lunch will be provided for all registered golfers. Participation is limited; register early.

Through the Gates of Graceland Saturday, Sept. 8, 1 – 5 p.m. $75 per person More than 30 years after his death, experience life as Elvis did. Step inside Graceland Mansion and explore his 14-acre estate with an audio-guided tour featuring commentary and stories

by Elvis and his daughter Lisa Marie.

See where Elvis lived, relaxed and spent time with his friends and family.

Check out his amazing collection of trophies including gold and platinum albums, movie memorabilia, luxury cars, two private jets and more.

Closing Dinner Celebration Featuring Brad Birkedahl and the Burnin Love Band Saturday, Sept. 10, 6:30 – 10 p.m.

Enjoy dinner, dancing, entertainment and breathtaking views of downtown Memphis and the mighty Mississippi from the rooftop of The Peabody Hotel.

The Financial Services Expo Check out the latest in financial industry product and service providers at the Financial Services Expo on Thursday, Friday and Saturday. The Convention marketplace features more than 30 of the industry’s leading vendors. For information about exhibiting contact Mike Baker at (614) 340-7600 or mbaker@ohiobankersleague.com.

CONVENTION REGISTRATION Registration fees, which include all scheduled meeting and meal functions as noted on the Schedule at a Glance, are:

OBL/ILFI Members First Registrant Additional Registrant Spouse/Guest Children (18 & Under)

$650 $600 $350 $50

Non-Members Registrant Spouse/Guest

$1100 $575

Refund Policy Requests for refunds must be received in writing to the sponsoring association with whom you registered no later than Aug. 29, 2012. A $150 processing fee for each registrant will be withheld for requests prior to that date. Cancellations received after Aug. 29 will not be refunded.

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$2.25 BILLION

in private corporate equity investments

27,500

Units of affordable housing

Massillon Senior Massillon, Stark County

525

Developments and partnerships

Doan Classroom Apartments Cleveland, Cuyahoga County

Franklinton Senior Columbus, Franklin County

Weinland Park Homes Columbus, Franklin County

Elberon Senior Cincinnati, Hamilton County

Heritage View Homes Cleveland, Ohio

For more information contact Hal Keller, President or Jonathan Welty, Vice President 614.224.8446

Richwood Greene Richwood, Union County

88 East Broad Street, Suite 1800 Columbus, Ohio 43215 www.occh.org

OCCH is an Endorsed Business Partner Marion Rotary Towers Marion, Marion County

Almond Village Dayton, Montgomery County

summer 2012

Ohio Record

Village At Anna Dean Barberton, Summit County

26

From the

Steps of the Statehouse Michael J. Adelman Vice President of State Government Relations

Summer. Summer. Summer. Just like in local school yards this chant is now heard around the Statehouse. The General Assembly is out of Columbus and back home. They may be in recess until after the November election. Many have new district lines and know the importance of being visible in their communities.

2012 has brought one of the busiest six-month legislative sessions in memory. Though a lot of bills made it through the process earning the Governor’s signature, many didn’t.

Those bills will await the General Assembly’s return. The so-called “lame duck” session encompasses those weeks between the election and the start of a new General Assembly in January. Five weeks are currently scheduled. Some lame ducks have seen a flurry of activity because bills that run out of time have to start the process over in the New Year.

The dearth of lawmakers around the Statehouse can breed a quiet that is concerning for those who aren’t as close to the process. This lull is not a time to let up, though.

Plenty of work is at hand if priorities are to be seen through to their finish. Bankers will be served well by reaching out to elected officials over the intervening months to share your views on banks tax reform. The OBL is conducting legislative district meetings around the state and we welcome your participation advocating for the state level bill that is first and foremost on your mind.

Known as the Financial Institutions Tax Reform Bill, Sub. HB 510, reflects a significant change to the way banks and thrifts are taxed in Ohio. As you know, major reform doesn’t happen every day. Ohio’s method of taxing banks and thrifts has gone largely unchanged for decades since the current Corporation Franchise Tax on Financial Institutions was put in place. With the general corporate taxpayers shifting to the Commercial Activities Tax a halfdozen years ago, we knew our time would come. Many hoped it would be sooner than later.

Regulatory burdens, including state taxation, have been on the minds of bankers for too long. In 2009, the inequity of the existing tax structure was a primary topic of discussion for the OBL district meetings. We applaud Governor Kasich’s interest in reforming bank and thrift taxation. Sub. HB 510 became stand-alone legislation when the House of Representatives decided to break the tax-related provisions from the Mid-biennium Budget Review bill. Following a fourth committee hearing, Sub. HB 510 was referred to the full House where it received an overwhelmingly supportive bipartisan 75-23 vote.

The final House version of the bill included several changes that were the result of numerous meetings with stakeholders. The change receiving the most attention resulted in a decrease of the bill’s revenue target by $20 million. Despite its characterization in the media, this change is unrelated to the banks and thrifts. It pertains to dealers in intangibles that do not belong to a financial institution group. These are non-bank entities such as captive finance companies, brokerages and maybe even payday lenders. The House summer 2012

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chose to line up these non-banks with the Commercial Activities Tax or Insurance Premiums Tax as opposed to the Financial Institutions Tax. Yet, since the CAT has a significantly different base and much lower tax rate these entities might only generate $4 million rather than $20 million, according to the Ohio Department of Taxation.

It’s an apples-oranges comparison.

Another modification made by the House was the creation of a third bracket in the tax rate. The intent was to lessen the amount of a tax increase borne by approximately a dozen and a half large community and smaller regional banks. ODT estimated this amendment would decrease the estimated revenue by $7 million.

The OBL contended from the outset that the revenue target was overly optimistic and reflected a net tax increase on the industry. Banks and thrifts alone only accounted for approximately $179 million in 2010. And, that figure is unfairly high.

First, it reflects increased capital levels regulators have insisted on in recent years.

Second, it likely includes tax paid on TARP that has subsequently been paid back and is thereby no longer in the tax base.

Now Sub. HB 510 is in the Senate Ways & Means and Economic Development Committee. Heading into summer recess it received a third hearing. Proponent witnesses that testified in favor of the bill included officials from the Kasich Administration. I testified on behalf of the banking industry as did Steve Wilson – Chairman and CEO of LCNB National Bank. No other interests or opponents stepped forward to testify in Senate committee.

As the OBL continues to advocate for a more realistic revenue target that would still be a revenue neutral result for the State there is hope that a cap can be inserted so that the higher capitalized banks and thrifts (i.e. greater than 14 percent) are not penalized for retaining capital. There are other technical fixes that the House ran out of time to make that the Senate might choose to address as well.

You can help the industry make good use of the summer by meeting with your state legislators to ensure they have the facts regarding financial institutions tax reform.

Your local opinions go a long way in securing success on important industry issues.

TAX REFORM HIGHLIGHTS Ohio Department of Taxation’s goals: Create a new Financial Institutions Tax to replace the current Corporation Franchise Tax and Dealers in Intangibles Tax. • Revenue neutrality – target is $200 m • Reduce the complexity of compliance • Minimize tax planning Tax Base • “Market-based” approach calculated on a consolidated basis from federal filings.

• All deductions and exemptions would be eliminated.

• Most economic development tax credits would carry over to new tax.

• Current credit on exam assessments for state-chartered thrifts would be extended to state-chartered commercial banks.

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Apportionment • Switch from a three factor (property, payroll and sales) to a single factor of sales – gross receipts sitused to the benefit of Ohio.

Rate • Lower from current 13 mills (Financial Institutions) and 8 mills (Dealers in Intangibles).

• Proposed 8 mills for first $200 million of total equity capital; 4 mills between $200 million and $1.3 billion; and 2.5 mills for total equity capital in excess of $1.3 billion.

• There are two rate adjustment mechanisms in 2014 and 2016 in the event the revenue misses the revenue targets +/- 10%. New rates would be effective for 2015 and 2017.

Filing timing • Take effect in calendar year 2014 based on 12/31/13 filings.

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OUTSOURCING/CONSULTING GROUP • Analytical Loan Review • Internal Audit Services • Compliance Review Services • Anti-Money Laundering Reviews • Secondary Market Quality Control Loan Review • Holding Company Accounting • FRB Holding Company Reporting • Branch Feasibility Studies/Applications • ALLL Methodology Reviews • Regulatory Agreement Assistance

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SPECIALISTS IN FINANCIAL INSTITUTIONS 1205 WEAVER DRIVE GRANVILLE, OHIO 43023 (740) 321-1000 • (740) 321-1100 Website: www.ddbco.cpa.pro

Leadership.

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With innovative coverage designed for today’s banking environment, a unique profit-sharing opportunity, and underwriters and claims staff who provide expert service and focus on community banks, our program has been an industry leader for 25 years.

To learn about ABA insurance Services, call or have your agent call 800-274-5222 or visit abais.com.

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AUG. 3

OBL TRAINING CENTER

SEPT 14; AND AUG. 24 & OCT. 19 ONE OR TWO PART PROGRAMS

Senior Bank Management Training

2012 OBL Regulator Roundtable 2011 Program Sold Out! Register early for the 2012 Regulator Roundtable, designed to offer time to hear from examiners first hand, have an opportunity to ask questions ahead of time and/or during the meeting and to address the ongoing sea of regulatory changes. Also includes an opportunity to network and share best practices with others.

The FDIC, OCC and Federal Reserve Bank of Cleveland will participate. Afternoon session is available.

SEPT. 11 & 12

OBL TRAINING CENTER

Karl Kerschner and Michael Stultz, partners from OBL affiliate member Meyer & Kerschner, Ltd., will provide training at the OBL Training Center late this summer and early fall. Officer & Director Legal Issues Training (Sept. 14) provides a detailed overview of current topics that Ohio’s community banks face in the boardroom and the marketplace, including Bankruptcy Law for Bank Executives, Lender Liability Update and Fraud Protection. A second one or two-part series on Creditors’ Rights - Effective Collections, Advanced Asset Recovery & Complex Litigation (Aug. 24 & Oct. 19) will focus on such topics as Recovery Before the Loss, Recovery in Consumer Bankruptcy, Asset Protection in Consumer and Commercial Bankruptcy and Loan Workouts.

SEPT. 16 – 21

OBL TRAINING CENTER

OBL Bank Security Workshop Barry Thompson, C.R.C.M., leads this annual workshop which receives high marks each year. He has more than three decades of financial services industry experience, and it is no wonder attendees find his workshop “very educational” … “covering relevant content with real life experience.” Others have noted he does a “good job of mixing up the program content each year while keeping it interesting” and all benefit from his ability to engage the audience with “great interaction.”

2012 OBL Bank Management School Expose a rising or experienced banker to a wealth of ideas and banking concepts. This comprehensive and intensive one-year program includes courses on asset liability, uniform bank performance report, investments, and strategic planning and risks, as well as participation in an intensive bank simulation program led by banking veteran Bill Campbell, providing excellent training in a safe environment, while giving them a competitive edge for their career and your institution.

SEPT. 27

LITTLE TURTLE GOLF CLUB

OBL Golf Classic

Seminar Favorites Return Save the dates now for OBL tried and true one-day programs that are returning to the OBL Training Center early this fall. Barry Thompson will hold the annual Bank Security Workshops, with an opportunity to attend one or two days.

Jim Clarke will speak to ALM Updates, while PMC will cover the basics and advanced issues related to IRAs.

The OBL returns to Little Turtle Golf Club, host of several USGA Amateur Qualifying Tournaments, for the annual Golf Classic. The shotgun start event includes 18 holes of golf, a buffet luncheon, cocktails, dinner and an awards presentation immediately after the completion of play.

Golfers may choose from two formats – play your own ball or scramble; and may register as a single player; two players; or put together your own foursome. Contact Gary Sutter at 614-340-7615 with questions.

IRA Updates – Sept. 6 Bank Security Workshops – Sept. 11 & 12 Lenders Comprehensive Guide to Mortgage Loan Compliance – Sept. 25 & 26 ALM Update & Review Seminar – Oct. 9 BSA Basics – Oct. 17 For questions about these or other seminars to come, please call Julie Kiplinger at 614-340-7612 or watch the OBL Web site for details.

OCT. 1 – 5

OCT. 23 & 24

Community Bankers for Compliance School

Credit for Individuals: Consumer Lending Basics

Presented by Young & Associates, Inc., this week-long school at the OBL Training Center provides a detailed understanding of the major regulatory compliance regulations (including any updates) that are prominent in today’s community bank. The school will also give practical tools and strategies to those attending to help in applying this information when they return to their banks. The CBC School has been designed to provide maximum flexibility to the bank and is divided into 2 modules: Operations and Deposit Compliance; and Lending Compliance. Special pricing available for CBC Program members.

This two-day workshop focuses on the consumer credit process and use of consumer credit as a relationship development tool. It is designed to help attendees develop a better understanding of how consumer credit functions as an integral part of retail banking; deepen the comprehension of the managerial aspects of consumer credit operations; and to refine the administrative and human relations skills lenders will need to manage the assets of their banks and meet the credit needs of their customers.

OBL TRAINING CENTER

OBL TRAINING CENTER

SUMMER

Please see the OBL Web site for a complete listing of currently scheduled events or to sign up for the programs listed below.

Working Together is More Important than Ever

Jeff Quayle OBL Senior Vice President, General Counsel & Managing Director, Ohio Bankers Benefits Trust

Since the last edition of Ohio Record, there have been a number of events that have unfolded that will be a challenge for community banks. A great example is the most recent proposal from the CFPB which requires new disclosure forms for residential mortgage loans.

While reconciling the inconsistencies between RESPA and TILA should be welcome, did it really take 1,100 pages of regulation and supporting materials to do so?

Earlier this summer, the traditional safety and soundness regulators announced new rules for measuring bank capitalization. As expected, the levels of required capital will be going up and the formulae required to calculate those ratios will become more stringent.

What was a bit of a surprise is that the regulators went beyond Dodd-Frank by phasing out the use of trust preferred securities for community banks.

Only recently, it has become clear that the recent Visa/MasterCard merchants settlement will also impact community banks. Next year, as retailers implement new bargaining units or get systems in place to surcharge credit card customers, interchange rates will be reduced by 10 basis points. There is no protection for smaller card issuers.

Friends Our industry however is not without its friends and supporters, and there is certainly some good news from the first half of 2012. At our request, Ohio congressmen Steve Stivers (R-Columbus) and Jim Renacci (R- Wadsworth) were among congressional leaders who eased the cost of raising capital and doing business for community banks by expanding the exemptions from SEC registration requirements.

Both of Ohio’s U.S. senators have cosponsored the bipartisan bill intended to put a stop to the frivolous litigation that requires fee disclosure to non customers be provided both electronically and with a placard on the outside of the ATM. Since all of the financial service industry was speaking with one voice, that same legislation has already been unanimously approved by the House of Representatives-something that happens only very rarely in a bitter election year.

Lowering Health Care Costs Closer to home, your health trust, the Ohio Bankers Benefits Trust, has been implementing a number of steps to lower increases in healthcare costs. Several measures we have taken already have proven successful in lowering the cost of claims in 2012. Now we are embarking on a system-wide wellness program. Look for more details on this new approach in future OBL publications, but over time these programs can have a significant positive impact for community banks. Working together, we can lower costs by preventing heath problems from becoming health claims. More importantly, wellness programs have the potential for making our workforce more productive and help them lead longer, happier, healthier lives.

The common thread here is that all of these positive outcomes were the result of working together. Clearly, there will continue to be challenges for community banking.

Some of these will come from policymakers or industries that are hostile to bankers or the role we play in the economy. Other challenges will result from changes in technology or the overall economy. Whether it through working to get to a common agenda in government advocacy, or working collectively in products and services or professional education, we will only meet the challenges successfully if we continue to persevere and work together.

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Accuracy.

When it matters most.

Floodplain Consultants Inc. has been providing community banks with the most accurate flood zone determinations available for over 20 years. Endorsed by the Ohio Bankers League, Floodplain Consultants Inc. is the proven leader in accuracy, compliance, and customer satisfaction.

To learn more about reducing compliance problems and increasing borrower satisfaction, contact Mike Hines. - mhines@floodplain.com

Endorsed by summer 2012

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Ombudsman Service Provides FDIC Batphone Ombudsman Rich Schmalzer (left) with OBL Senior Vice President Jeff Quayle (center) and OBL President Mike Van Buskirk

James Thurston Editor

Ohio Record recently sat down with FDIC Ombudsman Rich Schmalzer to get the inside track on how this liaison service is helping bankers in the Chicago region.

Ohio Record: For OBL members who don’t know too much about the Office of the Ombudsman, could you elaborate a little bit on your mission and how bankers can use your services?

FDIC Ombudsman Rich Schmalzer: The FDIC Office of the Ombudsman was established in response to the U.S. Riegle Regulatory Improvement Act in 1994 to serve as a confidential, neutral and independent resource for individuals who have questions, concerns or complaints about the FDIC regulatory process.

Bankers need to keep two things in mind: One, we are an informal process and two, contacts with us are confidential up until the point we are asked to go outside of that confidentiality.

Ohio Record: Would you describe what you do as mediation?

Schmalzer: It’s really more of a liaison service. Not really a mediator but definitely a party that helps facilitate communication.

Ohio Record: Confidentiality is critical to the process. Can you talk about that in some more detail?

Schmalzer: If a bank wants to keep something private that is no problem at all. We will only bring others into the loop when the banker asks us to. In most of the cases the banker wants to have one-on-one discussions, whether it’s with the examiner or whether it’s with the regional office where we will not be an active participant. But our presence there can help clarify some of the points being brought up and help get around potential roadblocks.

Ohio Record: For bankers who might be reluctant to come to you, what can you say to ease their comfort level regarding possible fear of retribution further down the line?

Schmalzer: When you have many people in the FDIC chain of command who are aware of problem issues at a bank, the worst thing an examiner could do would be to take any action that could be perceived as retaliatory.

Ohio Record: Because it would be obvious?

Schmalzer: Yes, it would be obvious, and everyone’s antennas would be on alert after the initial issues were raised. From a career stand-point it would be a very unwise choice for an examiner to do something like that. If retaliation were to occur at all, it would be more likely in a situation where the original issue is subtle

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or ambiguous. Bankers who perceive their bank to be subject to retaliation by the examiners are encouraged to contact our office to discuss the matter confidentially.

Ohio Record: Is it better for a bank to approach you earlier in the process?

Schmalzer: It never hurts to be early, especially if a banker is looking for guidance on some of the possible options that might be on the table. Then we can decide if there are things that need to be discussed with an examiner or perhaps a field supervisor at an earlier stage.

As things get further into the process, it might make sense to take things to a higher level talking to people in the regional office in Chicago or perhaps look at the appeals process.

Ohio Record: With Dodd Frank and the increasing attention on banking, there is a lot of pressure on both regulators and bankers which has really put the regulatory environment under the spotlight and created some tension between bankers and regulators. Has this resulted in more bankers using your services in the last couple of years?

Schmalzer: We most definitely have had an uptick in terms of bankers using our office at a variety of levels. Much of it comes in through our 800 number (800-925-4618) and our e-mail system (ombudsman@fdic.gov), then there are also the banks that contact me directly.

Quite often they may have had direct contact with me, through an event at an organization like the OBL or other industry group. In certain states, the bankers could contact the association directly and the association will contact me on their behalf.

Ohio Record: Is there anything you would like to add?

Schmalzer: The important thing from our perspective is for bankers to realize that we are a confidential sounding board and that talking to us can make a positive difference.

Schmalzer can be reached at (312) 382-7587 or RSchmalzer@fdic.gov.

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Creative print is more than just ink on paper It’s about gaining Attention for your business It’s about stimulating

Interest in your products

It’s about creating Desire for your services That’s where Ohio Record comes in

To reach over 4,000 key banking decision-makers contact James Thurston at (614) 340-7621 or jthurston@ohiobankersleague.com.

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Fraudulent wire transfers continue to plague community banks Mike Read Marketing & Sales Manager ABA Insurance Services, OBL business partner

While much has been written about these criminal schemes and how to avoid them, bogus requests continue to be a source of loss. It is difficult to detect and impossible to prevent all fraudulent activity. Sometimes even the most benign event can be the start of a serious loss. However, there are steps that can be taken to mitigate fraudulent wire transfer losses.

1. EDUCATE YOUR FRONTLINE EMPLOYEES A bank’s best defense is to educate front line employees to be alert for suspicious or unusual activity. Staff should be trained to be proactive and recognize signs of possible criminal acts such as irregularities with cash deposits or unusual questions about bank security measures.

Remember, a frontline employee’s gut feeling is often correct. Encourage your staff to immediately bring anything out of the ordinary to a supervisor’s attention.

2. ENCOURAGE YOUR CUSTOMERS TO MONITOR ONLINE ACCOUNT ACTIVITY Also, encourage your customers to stay alert and monitor their account activity online. The odds of catching a problem early and preventing a possible loss increase significantly when account statements are viewed in real time. For those that do not utilize online banking, such as elderly customers, your branch personnel

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should make an extra effort to inform them to be vigilant and mindful of scams.

3. IMPLEMENT A CALL-BACK PROCEDURE All transfer requests should be subject to a strict call-back or similar verification procedure. Not only is this a best practice, most insurers require a call-back or other form of verification as a precedent to coverage once the transfer amount exceeds a certain threshold, which, sometimes, can be as low as the financial institution bond deductible.

Insurers also require a written agreement between the bank and customer which authorizes the bank to act upon voice, email or faxed wire transfer instructions.

During the call-back, bank personnel should be careful in how they phrase verification questions, especially since personal information is more accessible by criminals due to the advent of social media and other searchable databases. For example, it is better to ask a customer what street they live on rather than asking them if they live on Main Street.

4. REQUIRE ALL ADDRESS CHANGES BE COMPLETED IN PERSON Have your customer sign a change of address form and compare the signature to what you have on file. Do not honor changes that are received by phone or email.

Recently, a bank was victimized by a wire transfer scheme after a caller purporting to be a legitimate customer changed the address and phone on an account.

Shortly thereafter, a fraudulent wire transfer request was faxed to the bank. When the bank called the phone number on the account to verify the request, they unknowingly spoke to the criminal and not the legitimate account holder. The bank sent the wire and ultimately suffered a six-figure loss.

5. REVIEW THE ACCOUNT’S HISTORY CLOSELY Does the account have a history of wire transfers? Is the number of requests unusually high? Is a small locally owned business requesting a large wire that seems out of place?

In the well-publicized Experi-Metal v. Comerica Bank matter, Experi-Metal historically had very limited wire activity; then suddenly, had a flurry of 97 bogus requests within a 6½ hour period.

6. ALL WIRE TRANSFERS INVOLVING HELOCS DEMAND EXTRA ATTENTION Criminals target HELOC accounts for obvious reasons: the available line of credit can be significant and loan statements are not printed as frequently as deposit account statements.

7. MONITOR INTERNATIONAL REQUESTS VERY CLOSELY We recommend that all international requests have an additional layer of management approval or even a waiting period.

Thieves are often from foreign countries seeking to wire funds to accounts overseas–typically those in China or former Soviet Bloc countries. It is nearly impossible to recover funds once they are wired to a foreign bank.

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VAGUENESS WHAT STARTS IN VAGUENESS, STAYS IN VAGUENESS

Steve Pease Executive Coach & Consultant Pease Strategic Partners

Last August I was talking with a bank president who told me that one of his top executives, with 31 years of experience came to him and announced, “I just want you to know, we officially do not know if we are writing mortgages correctly anymore.” With the abundance of regulatory ambiguity (ironically coupled with mounting compliance pressure) the truth was they no longer knew what they knew. Not with certainty. The president and I discussed the good old days when change was the big challenge. We light-heartedly reminisced about the bygone era of not long ago when the challenge was to figure out, who moved our cheese. Remember?

The days of change have for many organizations and their leaders been replaced by days of uncertainty. Although change and uncertainty are related (they likely showed up at the same family reunion this past summer), there is a difference. Change can often be marked by tangible or visible events. Uncertainty is marked by a dis-ability to see/understand present conditions and future steps. The skills needed for leading in change become magnified (marked by magnificent need) when trying to lead in uncertainty.

When leading in change, the effective leader reaches out. When leading in uncertainty, the effective leader reaches in. In times of change people need information/communication. In times of uncertainty, people need clarity. And they’ll do just about anything to get clarity even if it means constructing a present state derived from conjecture. Most people don’t accept disequilibrium for themselves and being immersed in a constant state of vagueness is a powerful push factor on talent within the organization (not to mention it proves to be a chief productivity inhibitor).

Ability to Deliver Clarity The extraordinary leader leads others out of a state of vagueness intentionally. What starts in vagueness will indeed stay in vagueness without conscious and skilled leadership effort. Delivering clarity of understanding as well as clarity of expectation is the key to behaviorally beginning to rid the environment of vagueness.

Clarity of understanding A leader reaches in to another by helping those he/she leads understand how they are dealing with the prevailing uncertainty – by helping another identify their problem or

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unmet need(s). Helping another identify their role and reactions to some of uncertainty’s realities is clarity that is powerfully impactful. The biggest impediment to the leader in their effort to deliver clarity of understanding to those they lead is simply this: most leaders are fixers. When approached by a direct report who has a problem or issue, with usually nothing but the best of intentions, the fixer (leader) usually quickly offers opinion, suggestion or information in an attempt to fix the problem.

Although well-meant, the quicker fix keeps the other from coming up with the solution on their own. And sometimes the presenting issue or problem is not necessarily the authentic or real problem. In times of change and uncertainty emotions and dramatic interpretations of organizational events run higher than in times of more relative stability. The quick fix or rapid solution response by the leader may at times keep the other from clarity of understanding of the entire issue, including expressing their feelings about it. The

real issue remains unaddressed because discussions remain at the surface. The emotions that arise as a result of uncertainty go ignored at a time when more complete communication is needed for the stability of the individual and the business.

Clarity of expectations The effective leader also delivers much needed clarity by being specific about their own needs and expectations. The effective leader is able to articulate their thoughts, feelings and expectations in such a thorough, illustrative and commanding way that others become energized by their interactions with the leader. The leader is getting their own needs met by addressing issues and fixing what truly is theirs to fix.

Choosing neither to avoid nor attack, the emotionally intelligent deliverer of clear expectations is able to do so by choosing to address most issues or problems that arise.

It is a choice that the exceptional leader makes that benefit those who operate around him/her.

Most good people really do want to do a good job and as self-sufficient as they might be, they have an appetite for and an appreciation for solid leadership. The leader who is clear about their expectations is more likely to reduce uncertainty as their communication often helps others understand what to do next.

Up-skill Your People Fortunately there are platinum level leadership skills available to the organization to assist leaders to operate more effectively in times of uncertainty. People respond to a clear voice and to clear thinking. You can not only bet on it, but you can take it to the bank!

Over 16 years of executive coaching and leadership development experience in helping organizations liberate and elevate their leadership talent. Pease Strategic Partners works with many banks who know that their leaders make the difference in marketplace performance.

Steve Pease (727) 692-1029 steve@peasestrategicpartners.com www.peasestrategicpartners.com

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Boosting your Bottom Line

Ahead of the Curve Large-Dollar Relationships Are the Key to Banks’ Future Success Erich Buckenmaier Regional Director Promontory Interfinancial Network, LLC

The saying, “History repeats itself,” may have been first recorded in English in 1561, but it’s just as true today.

Back in the summer of 2008, just as the financial crisis was gathering steam, attracting core deposits was a priority. At that time, the median loan-to-deposit ratio for the largest banking companies was above 105 percent, showing an imbalance of loans exceeding deposit levels. These imbalances were not something new, but rather part of a larger trend starting in the 1990s that saw banks chase large-dollar deposits – indeed, nearly any size deposit – as growth in traditional deposit funding sources stagnated and failed to keep up with the increase in bank assets.

Today, with the economy still in the doldrums, many in the banking sector, flush with cash, find themselves doing what would have been unthinkable just a few years ago; they are discouraging – even actively turning away – deposits.

However, whether history repeats itself in the near- or long-term, some banks continue to focus on large-dollar

relationships. Let’s take a look at some of them.

Positioning for Long-Term Success While it may cost more in the short term, attracting multi-million-dollar relationships can help to build bank franchise value, provide cheaper funding to support loan growth when the economy rebounds, and offer a hedge for the future against higher cost of funds. The American Banker recently wrote that “Wells Fargo & Co.’s chief executive, John Stumpf, has a pretty clear message for those who think Wells should slam on the brakes of its rapid deposit growth – go jump in a lake.” It went on to quote Stumpf as stating, “We’re long-term thinkers and bringing on new relationships that happen to come with deposits. Fantastic. We’ll take all those we can take, even if it makes short-term results more challenging.”

Along those same lines, the American Banker cited Mooney and Webster Financial Corp.’s Chairman and CEO, James Smith, as talking about the importance of “deepening relationships with small-business and middle-market customers.”

Meanwhile, wsj.com shared that, “Greater New York City, for instance, boasts a deposit base just shy of $1 trillion, about two-thirds the size of the whole of Canada. TD Bank, one of the ten largest financial institutions in North America is

now fifth by deposits in that retail-banking market, with a 3.6 percent share. Mr. Clark [TD’s CEO] wants to be No. 3 in four or five years, without new acquisitions.”

Increasing Profitability Bringing in large-dollar deposits can increase bank profitability in a number of ways. For starters, it can help a bank to leverage fixed costs – for example, to spread per-customer acquisition and maintenance costs over a larger deposit base. As Bank Think, an American Banker publication, reported, “It’s no secret that a large number of traditional retail accounts do not generate a profit for the big banks – in particular, customers who hold small balances or do not purchase multiple products from the same institution.”

Industry estimates vary widely, suggesting anywhere from 25 percent to 75 percent of accounts either just break even or produce operating losses. This is probably why a number of banks are trying to win over larger business accounts and other large-balance clients. Are banks flush with cash really willing to do that? The Chicago Tribune reported, “It may be all the rage for Occupy-Wall-Street-types and others to take potshots at people with a high net worth, but those hefty balances add up to bigger bucks for the financial services industry…Chase believes that its privateclient business could generate as much as $1 billion in net income annually.

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Boosting your Bottom Line services firms, including Bank of America, PNC Bank, and even Discover Financial Services have recently introduced or bolstered products and services for wealthier clients.” Additionally, largedollar deposits can be used to develop close relationships – relationships that foster cross-selling opportunities at a time when cross-selling is so important to a bank’s bottom line. Terry McEvoy, a banking analyst with Oppenheimer & Company says that “banks are struggling to grow revenue” and that “selling more products to more customers is key.” And the American Banker recently reported that bankers believe that “selling more products to existing customers…would be crucial to earnings growth.” PNC Bank’s Chairman and CEO, Jim Rohr, says his bank is focused on adding new customers and cross-selling other banking services.

Cross-selling to new depositors will greatly help the bank’s bottom line. According to Rohr, “If we cross-sell new clients, we’ll see an almost $220 million increase. And we‘re going to do that.”

Tools for the Future Corporate cash holdings have grown by 59 percent since 2008, and the appetite for safe investments is expected to remain big. If history is any indication, now is the time for forward-thinking banks to position themselves competitively for the future by attracting profitable relationships and protecting their best customers. These goals can be achieved more easily with two great tools – CDARS® and ICS – available to OBL members through the Promontory Network.

By enabling banks to offer a return plus access to multi-million-dollar FDIC insurance, CDARS and ICS can help financial institutions to attract customers with six, seven, and eight figures to invest.

This means Promontory Network member banks can build deeper relationships with their best customers, as well as attract new, large-dollar clients.

Get ahead of the curve by calling OBL business partner Promontory’s Erich Buckenmaier at (866) 776 6426, ext. 3354 or emailing ebuckenmaier@promnetwork.com.

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Focus On… Remembering Tiney McComb 1943-2012 Ohio Banking Industry Loses Leader, Friend

Former OBL Chairman Tiney M. McComb passed away earlier this quarter.

McComb, former chairman and president of Heartland BancCorp, fulfilled a variety of leadership roles within the banking industry and local community. He was a former Cleveland Fed director, a member of the U.S. Small Business Administration’s Advisory Council and chaired the Ohio banking industry’s political action committee Ohio BankPac. In 1984, he was one of twelve bankers selected from around the nation to participate in a groundbreaking delegation to China to work on trade relations with Tiney M. McComb the U.S. “The greatest privilege of working for the OBL is the people we get to work for,” said OBL President & CEO Mike Van Buskirk. “Banking attracts ethical people committed to building lives and communities. I’ve been at this job a while now, and I’ve met some truly exceptional people. Ohio lost one of the best in Tiney McComb.”

James W. Everson, chairman, president and CEO of United Bancorp, Martins Ferry, added, “Tiney McComb was a man of vision who founded Heartland Bank in the mid-1980s and grew it into the fine organization it is today.” Everson preceded McComb as OBL chairman by one year and the two became good friends through their work with the association.

“He was the consummate community banker who dedicated himself not only to banking but also to community service,” Everson added.

Outside of banking, McComb was past president of the Ohio 4-H Foundation and was director emeritus for the Ohio Red Cross. He was also a noted inventor, and was a finalist for the Central Ohio Entrepreneur of the Year award in 1997.

William T. McConnell, chairman of the executive committee at Park National Bank, commented, “Tiney was one of my oldest friends in banking.

Throughout his long career, he faithfully served his several constituencies: his stockholders, his customers, his associates, and his community.”

Find Us on the Web Go to www.ohiobankersleague.com to catch up with the latest news as it happens in the Ohio banking community. View our calendar of events; get involved in online political grassroots campaigns; find a product or service; browse our banking news section; or enroll in the latest in banker education programs.

It’s all there.

Furthering the Banking Industry

ADVANCING CAREERS Visit the OBL Career Center, where we’re bringing Ohio’s banking community together.

Find local banking jobs, recruit qualified candidates and get connected!

OBL CAREER CENTER ohiobankersleague.com

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People, ideas and technology all working together.

It’s happening here. That’s how Fiserv is transforming the way financial services are delivered and meeting the financial services technology needs of more than 16,000 clients worldwide. With Fiserv, you have the power to give your customers what’s next, right now. The power within. getsolutions@fiserv.com 800-872-7882 www.fiserv.com

Payments

Processing Services Customer & Channel Management Risk & Compliance Insights & Optimization

© 2012 Fiserv, Inc. or its affiliates.

Coming together to tame benefit costs.

In today’s competitive marketplace, benefits have become as important as compensation when hiring or retaining the best OBLBut r2 012712 OH Bankers League Ohio Record Trim 7.375” x 4.75” and brightest. health insurance doesn’t come cheap.

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: Benefits Manager Gary Sutter or the Newest Member of the at 614-340-7615 or gsutter@ OBBT Team, Plan Administrator ohiobankersleague.com Erin Husslein at 614-340-7617 or ehusslein@ohiobankersleague.com

OHIO BANKERS BENEFITS TRUST 44

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Working for Banks and Bankers

BUCYRUS

NEWARK

WORTHINGTON

Sara Craig, AVP at The Farmers Citizens Bank recently completed the twelfth annual Human Resource Management School presented by the Graduate School of Sara Craig Banking at the University of Wisconsin-Madison.

Park National Corporation recently thanked James Cullers and William Phillips for their service on the Park board of directors.

Cullers, of Mount Vernon, is the sole proprietor of Mediation and Arbitration Services, and retired as a senior partner, attorney and general legal counsel at Zelkowitz, Barry & Cullers. He has served on Park’s board since 1997.

Phillips, of Zanesville, is the former chairman and CEO of Century National Bank and has served on Park’s board since 1990. He has nearly 50 years of uninterrupted service to Century National Bank, another of Park’s community banking divisions. He will remain a member of the advisory board for Century National Bank, where he currently serves as chairman of the Executive Committee.

Compliance outfit Community Bank Solutions, LLC recently merged with Bankers Bancshares, Inc., the parent company of Great Lakes Bankers Bank and F & M Credit Services, Inc. Charlotte Martin, president & CEO of GLBB, remarked, “Compliance services fit very well with our strategic vision of serving, preserving and promoting independent community banking. Tactically, it makes sense because our clients generally cannot afford to have full-time dedicated specialists in every critical area.”

GAHANNA G. Scott McComb, president, chairman & CEO, Heartland Bank, recently accepted the Graduate School of Banking’s invitation to serve a three-year term on G. Scott the GSB Banker Advisory McComb Board representing Ohio, beginning in August. McComb will succeed David Anderson, regional president, State Bank and Trust Co., Lima.

LEWIS CENTER The Delaware County Bank & Trust Company recently announced the addition Roger Lossing as the new senior vice president of wealth management. Lossing comes Roger Lossing to The Bank from the Wealth Management/ Trust Services Division of PNC Bank.

He has over three decades of experience advising individuals, corporate executives and closely held business owners in the areas of financial, estate and tax planning, investment management and personal trust administration. In addition to PNC Bank, Lossing previously served as a financial advisor for several other institutions including JP Morgan Chase, Ernst & Young LLP, Smith Barney and Deloitte.

OAK HARBOR Gary P. Macko, president and CEO of National Bank of Ohio, recently announced that Amy Eisenhour was promoted to senior vice president. Eisenhour joined the bank in March of 2011 and has more than 25 years of banking experience.

She started her career at Citizens Savings Bank in Pemberville where she was vice president and cashier. After Rurban Financial Corp. purchased Citizens Savings Bank, she moved over to the holding company as vice president of operations.

She was responsible for consolidating the operations of the four banks that Rurban owned at that time. In 1999, Eisenhour moved to RDSI Banking Systems, another division of Rurban, where she managed the Customer Service Department and then became a Client relations manager.

She was responsible for the relationship between RDSI Banking Systems and The National Bank of Oak Harbor, which made for a perfect transition when the bank hired her.

YOUNGSTOWN The Lakeland Foundation, a nonprofit organization that raises money for grants and scholarships for Lakeland Community College students was recently presented with a check for $1,500 from the Home Savings Charitable Foundation for annual support.

Tell Us About It Have an interesting story to tell, recent promotions, innovative program or other bank announcements? If it’s news you think we need to know… tell us about it. We’re interested in keeping up to date on the activities of our members. Please put the OBL Communications Department on your media mail or e-mail lists. Send your news to: James Thurston Editor, Ohio Record, jthurston@ohiobankersleague.com, 4249 Easton Way, Suite 150, Columbus, OH 43219-6170.

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Focus On… Standing Stone National Bank, Lancaster The board of directors of Standing Stone National Bank announced the following promotions: Jeff Beard was promoted to executive vice president, chief financial officer & cashier with the responsibilities of maximizing the bank’s operating performance and achieving its financial goals. Beard received a degree in business administration from Tiffin University and has his MBA from Capital University. Jeff Beard Beard is also a rotarian, and volunteers for various community committees and projects.

He resides in Fairfield County with his wife and three sons.

Tara Bartlett was promoted to assistant vice president and bank services officer.

Bartlett’s responsibilities include new account representative, on-line banking, daily management of the bank teller staff, and assisting the vice president branch administrator. Bartlett started her banking Tara Bartlett career with Standing Stone National Bank in 2001 and 2009. She volunteers for various community projects and resides in Fairfield County with her husband, two daughters, and one son.

Kristi Conaway was promoted to assistant vice president and operations officer with the responsibilities of the bank’s operations, accounting, and financial reporting. Conaway completed her associate degree in accounting at Ohio University. She volunteers for various community projects Kristi Conaway and resides in Hocking with her husband and daughter. Conaway began her banking career with the bank in 1999 and 2007.

Nichole McLaughlin was promoted to branch officer with the daily responsibilities of managing the bank’s North Branch location.

McLaughlin received her Associates from Columbus State Community College. She resides in Fairfield County with her husband Kristi Conaway and joined the bank in 2008.

Industry Accolade for Payments Guru Woessner Former OBL staffer Jerry Woessner was recognized for his contributions to the banking industry this quarter with EPCOR’s 2012 Marquis Award. Woessner, who retired in May, began his career as a field officer with OBL legacy organization the Ohio Bankers Association in 1972.

He became responsible for seminar programs, Ohio Schools of Banking and Consumer Credit and Bank marketing soon after joining the OBA. After leaving the OBA in 1995, Woessner served as an advocate for the Automated Clearing House as president of the Columbus Regional Automated Funds Transfer System. He was named Chief Executive Officer and President following the merger of CRAFTS and Mid-America Automated Payments System in 2001 which created Payments Central, and then President of EPCOR resulting from the merger of Payments Central and MidAmerica Payments Exchange in 2009.

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“I thank you all for your kind wishes and support over the past forty years,” said Woessner upon receiving the award at EPCOR’s annual conference. “The reason that EPCOR exists and thrives today is because of the people in this very room; it’s you. I commend you on your passion Jerry Woessner for your industry. I thank you for providing the support and leadership it needs to be effective. You truly are a remarkable group of people, and I will never forget you.”

Two Marquis Awards are presented annually by EPCOR in recognition of an individual or organization that exemplifies best practices in electronic payments implementation, expands awareness and utilization of ACH payments or contributes greatly to the mission of the Association.

THE SMALL BUSINESS LENDING FUND DIDN’T GET HERE ON ITS OWN. IT CAME WITH GUIDELINES. THERE WERE THE FORMAL GUIDELINES. THERE WERE THE INFORMAL GUIDELINES THAT EXPLAINED THE FORMAL GUIDELINES. AND THERE WAS A 30-DAY DEADLINE. SO, THERE WERE EMERGENCY SHAREHOLDER MEETINGS, AND DISCLOSURES AND NON-STANDARD PROXY STATEMENTS, AND CHANGES IN CHARTERS AND CORPORATE STRUCTURES. ALL TO MEET, YOU GUESSED IT, THE GUIDELINES. SO HOW DID WE HELP OUR FINANCIAL SERVICES CLIENTS MEET THOSE GUIDELINES, INCREASE LENDING TO SMALL BUSINESSES AND HELP COMMUNITIES GROW? WE FIGURED IT OUT.

Higher standards make better lawyers.® For more information on our work in financial services, visit vorys.com/financial.

Vorys, Sater, Seymour and Pease LLP 52 East Gay Street Columbus, Ohio 43215 summer 2012 Columbus Washington Cleveland Cincinnati Akron Houston

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When it comes to BOLI,

experience counts.

Getting the best possible return on your bank-owned life insurance isn’t easy. It takes wisdom, design and diligence. That’s why it takes experienced experts. Like Banc Consulting Partners.

With nearly 20 years’ experience, Banc Consulting Partners is the leader in BOLI design, analysis, compliance and plan service. We’re endorsed by the Ohio Bankers League and have earned the trust of more community banks than any other firm in the country.

So when you want the best for your BOLI portfolio and a meaningful, long-term relationship with the advisor who provides it, talk to an expert. Talk to Lou Moore at Banc Consulting Partners.

Because when it comes to BOLI, experience counts.

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MANAGING PRINCIPAL

440.356.8860 PHONE 216.789.8889 MOBILE 440.730.3131 FAX lmoore@yourbankpartner.com