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Member News
Canton Housing Authority Announces the Start of Rehab Project
MarketWatch
(4-11-13)
In the coming months, the Canton Housing Authority will provide critical home repairs for 45 very low- to low-income homeowners in Canton, Mississippi. This initiative is funded by the Housing Authority, the Federal Home Loan Bank of Dallas, and CDBA member BankPlus. FHLB Dallas and BankPlus awarded the housing authority a $495,000 Affordable Housing Program (AHP) grant in 2012 to help fund the project. "I'm excited to work with the Canton Housing Authority to assist eligible households in Canton with needed home repairs," said BankPlus First Vice President and Director of Affordable Housing Mark Ouellette. "This is something we've discussed over the years and upon presenting the grant application in 2012, the Federal Home Loan Bank of Dallas decided to fully fund the request. I believe this collaboration will have a tremendous impact on many deserving families."
De Novo Banks Need a Niche
American Banker
(4-1-13)
Eighteen investors—many of them Amish—are planting the seeds for a new community bank outside Lancaster, PA. If the investors can convince regulators that the new institution will thrive, Bank of Bird-in-Hand would become the first de novo in the United States in more than two years. Though many are watching its progress with regulators closely, the hopeful startup is unlikely to see much company, at least over the next year, according to lawyers, consultants, and investment bankers. The regulatory and economic factors that froze de novo activity for the last few years remain in force. In addition, changes in technology and customer behavior could conspire to make the traditional startup a thing of the past—or at least a lot more difficult. Many attorneys and consultants feel the FDIC has been discouraging the formation of new banks since late 2008, preferring that investors plow money into existing institutions that need capital to survive. In 2009, the agency tightened oversight of startups, which have been rare in the years since. The country's last new bank, the $39 million-asset Start Community Bank in New Haven, CT, opened in the fourth quarter of 2010.
Of Interest
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Member News
United Bank Restructures; Promotes Three Senior-Level Executives
AL.com
(4-9-13)
Three senior-level officers with United Bank in Atmore have been promoted to newly created executive vice president positions.Gwen Braden will now serve as executive vice president and chief operations officer; Mike Vincent will serve as executive vice president and chief credit officer; and Casey Gay Zito will serve as executive vice president and chief retail officer. “As we continue our momentum and focus our vision beyond 2013, each will play a critical role in the direction of the bank and in shaping our future,” Robert R. Jones III, president and chief executive officer of United Bank, said of the promotions already approved by the bank’s board of directors.
Of Interest
Bailed Out Banks Haven't Met Goals of Small Business Lending Program, Report Says
Banks used billions from a small-business lending program to repay government bailout funds, rather than for its intended purpose — making more loans to mom-and-pop operations, according to a watchdog report released Tuesday. The Small Business Lending Fund dished out more than $4 billion to 332 community banks, credit unions, and community development financial institutions to lend to Main Street businesses. By signing up for the lending program, banks could convert their TARP obligations into a lower-interest loan and escape restrictions on executive compensation. But in return, the banks were supposed to increase their lending to small businesses. Instead, 132 TARP recipients participating in the small-business program used about $2.1 billion they were awarded to exit TARP, rather than increasing lending, according to the report from the TARP special inspector general. “For some TARP banks, SBLF turned out to be little more than a TARP exit strategy,” said Christy Romero, special inspector general for TARP.
Six Ways Banks Can Defeat Hackers and Reduce Data Breaches
When it comes to dealing with hackers and data breaches, small banks have more to lose than big banks: They face an uphill battle to win back customer...
From the Washington Post: "Banks used billions from a small-business lending program to repay government bailout funds, rather than for its intended purpose — making more loans to mom-and-pop operations, according to a watchdog report released Tuesday. The Small Business Lending Fund dished out more than $4 billion to 332 community banks, credit unions, and community development financial institutions to lend to Main Street businesses. By signing up for the lending program, banks could convert their TARP obligations into a lower-interest loan and escape restrictions on executive compensation. But in return, the banks were supposed to increase their lending to small businesses. Instead, 132 TARP recipients participating in the small-business program used about $2.1 billion they were awarded to exit TARP, rather than increasing lending, according to the report from the TARP special inspector general. 'For some TARP banks, SBLF turned out to be little more than a TARP exit strategy,' said Christy Romero, special inspector general for TARP."
On April 8, 2013 the membership of the Community Development Bankers Association submitted a comment letter to the CDFI Fund in response to the Community Development Financial Institution Fund’s (CDFI Fund) request for public comment on the Interim Final Rule implementing the CDFI Bond Guarantee Program (CBGP). The Interim Final Rule was published in the Federal Register on February 5, 2013. We thank the CDFI Fund for the opportunity to comment and urged the U.S. Department of Treasury to implement the program in a manner that enables the entire, diverse CDFI sector to use the program for the benefit of distressed communities across the country.
Our comments focused primarily on explaining how the CBGP presents an opportunity to enable CDFI banks to significantly expand provision of credit in Low-and Moderate-Income (LMI) communities given the program's design and a rapidly changing and restrictive bank regulatory environment. Among the recommendations, our highest priority is ensuring that the Use of Bond Proceeds and Secondary Loan Requirements are consistent with allowing CDFI banks to use proceeds as Tier 1 capital if approved by the Federal banking regulatory agencies. As such, we asked for the US Treasury’s and CDFI Fund’s support as we seek an exception to the Basel III rule for the CBGP. A second tier set of recommendations was focused on ensuring the CDFI Bond Program proactively mitigates potential conflicts with other regulatory rules that might otherwise prevent CDFI bank participation. A third tier set of recommendations focused on issues of general concern regarding the program's structure and requirements. Like our colleagues in other sectors of the CDFI industry, overall program fees and other costs are the greatest concern. The subsequent recommendations were listed in descending priority order in the letter.
Member News
United Bank Director Inducted into Atmore Area Hall of Fame
Atmore News
(4-3-13)
One can hardly talk about the recent history of the Poarch Band of Creek Indians without mentioning Eddie Tullis. He was deeply involved in the Tribe’s efforts to gain federal recognition. In addition to his work with the Tribe, Tullis served in the U.S. Navy and worked for Monsanto for more than 35 and a half years, retiring in 1991. He has been involved in almost every aspect of tribal government, as well as many areas of the community. His involvement in Indian affairs reaches to the national level. Additionally, he served on the United Bank Board of Directors. He will be inducted into the Hall of Fame in May.
BankPlus: On the Move
Clarion-Ledger
(3-30-13)
BankPlus welcomes several staff members: Jason Bounds has been promoted to assistant vice president and loan officer in the bank’s Picayune main office. A native of Picayune, Bounds is a graduate of Pearl River Community College and the University of Southern Mississippi. Uvonda McMurtrey has been hired as legal department manager and bank officer. McMurtrey has more than 30 years of experience in the legal field and was most recently employed with Jones, Walker, Waechter, Poitevent, Carrére & Denégre LLP. A native of Terry, McMurtrey attended Hinds Community College. Marcia Reed has been promoted to bank officer in the bank’s Dalton Street office. Reed has been with BankPlus four years as CreditPlus sales manager. She attended Bethel College and the University of Minnesota. She has experience in first-time home buyer training and credit counseling and formerly served on the board of the Mississippi Home Buyer Education Center. Nathan Lucas has been hired as trust officer in the bank’s Wealth Management Group. Lucas has more than five years of experience in wealth management and was most recently employed with Regions Corporate Trust. A native of Jackson, Lucas has a bachelor’s degree from Auburn University and a master of business administration from the University of Alabama-Birmingham and is a graduate of the University of Alabama School of Law.
Small Banks Developing Ways to Compete Against Payday Lenders
American Banker
(3-27-13)
More community banks are preparing to fight payday lenders...
The Technical Assistance Video Program is a series of educational videos designed to provide useful information to bank directors, officers and employees on areas of supervisory focus and regulatory changes.
New Director Education Series
The first release of videos provides information to new bank directors about their fiduciary role and responsibilities as well an overview of the FDIC’s Risk Management and Compliance Examination processes. These videos are available on the FDIC's YouTube channel.
Virtual Director's College Program
A second series of videos is a virtual version of the FDIC’s Director's College Program that regional offices deliver throughout the year. The initial training program will consist of six modules to be released by June 30, 2013.
Virtual Technical Assistance Program
A third group of videos to be released by year-end will provide technical training to bankers on a range of regulatory issues. The initial training program will consist of six modules.
Proposed Rulemaking Videos
Lastly, the FDIC will continue the model introduced as part of the capital rulemaking process to provide overviews and instruction in a variety of formats, including videos, for more complex rulemakings.
Member News
Final Date Set for Charles Street Bankruptcy Hearing
Bay State Banner
(3-22-13)
After a year of startling disclosures by Charles Street AME church officials, including an estimated $400,000 in misappropriated funds designated for a church pastoral program, U.S. bankruptcy Judge Frank Bailey set a final hearing date in the increasingly bitter trial pitting the historic church against OneUnited Bank. The April 12 confirmation hearing will determine whether the court will accept the church’s plan to repay nearly $5.2 million in loans to the nation’s largest black-owned bank as well as additional funds to outstanding creditors. Charles Street attorneys have argued that once the bankruptcy hearings are completed, the church can then finish building its Roxbury Renaissance Center and start generating money by holding wedding receptions and community meetings to repay its debts over a 30-year period. OneUnited attorneys have opposed such repayment plans in large part because of what they have discovered are significant problems with the church’s financial statements that are being used to determine the repayment plan.
Bank2 CEO and President Ross Hill to Give OBU's Minter Lecture
News-Star
(3-20-13)
Ross A. Hill, Founder and CEO of Bank2, will present Oklahoma Baptist University’s 2013 Minter Lectureship in Business, Leadership, and Christian Ministry on Monday, April 8, at 10 a.m. in Bailey Business Center’s Tulsa Royalties Auditorium. The community is invited to attend. The title of Hill’s lecture will be “Leadership Essentials for the 21st Century.” In the 10 years since he founded Bank2, Hill and his team have helped thousands of people and firmly established the institution as a national star in the banking industry. In 2009 and 2010 the American Banking Journal ranked Bank2 as the first and third community bank in the nation, respectively, as measured by the banking industry’s gold standard of return on equity. The Minter Lectureship in American Business Practice is intended to add a sound understanding of the business world to the educational experience of church ministry majors to broaden their ability to minister effectively. The Minter Lectureship was underwritten by 1940 OBU graduate Lloyd G. Minter of Bartlesville. The annual series began in 1991.
In an article entitled "Small Banks Developing Ways to Compete Against Payday Lenders," the American Banker featured CDBA member One PacificCoast Bank. The article states, "More community banks are preparing to fight payday lenders and technology upstarts for a bigger share of short-term, small-dollar loans. For smaller institutions such One PacificCoast Bank in Oakland, Calif., and National Bank & Trust of Sycamore in Illinois, the battle isn't about booking loans. Rather, the goal is to win back fee income that community banks have ceded to others in recent years."
The article continues to describe One PacificCoast's innovation, stating "One PacificCoast also has an alternative to paycheck advances. The $282 million-asset bank offers a service to employers that lets workers take out small-dollar loans."
Read the full coverage of these alternatives to payday loan products below.
Member News
Agreement with Highland Community Bank Paves Way for Launch of Generations Community Bank
Generations Community Bank
(3-20-13)
Generations Community Bancorp, Inc. has reached a definitive agreement with Highland Community Company for the acquisition of its subsidiary, Highland Community Bank. This transaction will enable Generations Community Bancorp to complete its goal of opening a minority-led and locally managed community bank, under the name of Generations Community Bank, in the Chicago South Side locations where Highland Community Bank operates today. Generations Community Bank expects to be certified as both a Community Development Financial Institution (CDFI) and a Minority Depository Institution (MDI). "The acquisition of Highland provides an entree for Generations Community Bank to expand access to credit and other financial services to businesses and individuals across the South Side. Many of these communities have been hit hardest by the recession and tightening of credit," said Matthew Roth, proposed president and CEO of Generations Community Bank. "Highland Community Bank has been a positive presence in the community for four decades and we intend to build upon that tradition, creating a seamless transition for Highland's loyal current customers as we seek to increase the flow of capital to both the commercial and consumer sectors in Auburn-Gresham and the broader South Side community."
CDBA Members Mentioned in NerdWallet's PayDay Alternatives Feature
NerdWallet
(3-18-13)
The article states that "through payday loan alternatives, credit-building loans or other short-term loan options,...
On March 19, 2013 the Community Development Bankers Association (CDBA) submitted formal comments to the Consumer Financial Protection Bureau (CFPB) in response to the Bureau’s proposed amendments to the Ability to Repay Standards under the Truth in Lending Act (Regulation Z), as published in the Federal Register on January 10, 2013.
In summary, CDBA supports the CFPB's recognition of the important contribution made by Community Development Financial Institutions (CDFIs) in serving underserved urban and rural markets. We fully appreciate the CFPB for recognizing the regulatory burden that could be imposed upon mission‐focused lenders. We urge the CFPB to proceed with the proposed exemption for CDFIs and other proposed exempted organizations from the Ability to Repay Standards under the Truth in Lending Act. CDBA believes the CFPB's proposed exemptions are a reasonable approach, which balance the protection of consumers with the need for an appropriate level of regulation of the mortgage market. While most CDFI banks are already exempt from the Ability to Repay Standards under other small or rural bank exemptions, not all meet the qualifications for these exemptions. All CDFIs are focused on serving the toughest most credit starved communities and should be exempt from the Ability to Repay Standards under the Truth in Lending Act. We urge the CFPB to be inclusive of all CDFIs under this exemption.
We do, however, urge the agency to address some drafting discrepancies that create confusion about how the CDFI exemption is to be applied. Specifically, the rule contains inconsistencies as to which CDFIs are covered by the proposed § 1026.43(a)(3)(v) exemption. On balance, it appears that the intent of the exemption is to apply to all organizations that are certified CDFIs. Yet, the language in some parts of the proposed rule are inclusive of all CDFIs, while others only reference a narrower group of “nonprofit” CDFIs or “nonprofit creditors.” To date, there are nearly 1,000 organizations that have been certified by the U.S. Department’s Community Development Financial Institutions (CDFI) Fund. While the large majority of those entities are nonprofit organizations, a significant number are for‐profit banks and for‐profit loan funds.
Read the full comment letter for the specific recommendations proposed by the Community Development Bankers Association.