December 19, 2012
Member News
Virginia Community Capital Finishes 2012 Strong with 3 Grants Virginia Community Capital (12-10-12)
Virginia Community Capital has received three national grants this past month to support its work in low-income communities and bolster ongoing job creation efforts. A $415,000 grant from the 2012 Bank Enterprise Award Program (BEA), offered through the U.S. Department of Treasury's Community Development Financial Institution Fund, will provide leverage for a wide range of projects across Virginia. This is VCC's fourth consecutive BEA award. $32,750 from the Create Jobs for USA Fund, a collaboration between Starbucks and the Opportunity Finance Network to spark job creation nationally, will combine with first round funding secured in 2011. $20,000 from the Wells Fargo NEXT Awards Program, supporting innovative CDFIs, will provide planning grant funds for the Healthy Foods initiative at VCC. "These grants increase our capacity to provide funding and technical advisory services for low-income communities across Virginia," offered Jane Henderson, VCC President and CEO. "We are especially pleased to see national organizations recognize our efforts and the importance of fellow CDFIs."
Of Interest
law, the FDIC surveys insured depository institutions
every two years to assess their efforts to bring individuals and families who have rarely, if ever, held a checking or a savings account at an insured depository institution, into the financial mainstream. Key recommendations for banks include: expand offerings of basic, low-cost checking and savings deposit accounts; offer additional transactions services to underserved households, including non-customers; enhance small-dollar loan product marketing; utilize partnerships with community organizations to promote checking and savings account ownership, and consider expanding retail strategies to build relationships with underbanked and unbanked consumers.
FDIC Releases Community Banking Study, Supervisory Initiatives
FDIC
(12-18-12)
The FDIC released the results of a study of community banking in the United States, as well as a series of supervisory and rulemaking measures relating to community banks, as the outcome of its yearlong Community Banking Initiative. The study suggests that the community banking sector can generate most of the capital it needs through retained earnings. However, there are two important caveats to this conclusion. First, the ability to generate capital internally depends on a healthy level of earnings. In periods where earnings have faltered, retained earnings have declined sharply or become negative, requiring more community banks to raise capital from external sources. Second, retained earnings can only be a sufficient source of capital if the asset base of the institution is not growing more rapidly than its earnings. Chapter 5 demonstrates how hundreds of community banks in relatively stable, high-performing lending specialties in 2000 pursued growth-oriented strategies centered on C&D and CRE lending that ultimately underperformed for many of them. Community banks with TruPS at the holding company level were almost twice as likely to undertake such a shift in strategy as those that did not use TruPS. The experience of community banks during the study period appears to indicate that maintaining a stable balance between growth and earnings has been the surest path to long-term viability.
Consumers Rate Small Banks Higher Than Big Ones News Tribune (12-16-12)
With the exception of JPMorgan Chase, big banks continue to fall out of favor with consumers. A report by the American Customer Satisfaction Index (ACSI) finds customers satisfaction with banks rose 2.7 percent this year, due almost entirely to satisfaction with small community banks. Small banks -- stable at an ACSI score of 79 -- continue to outclass large banks and capture market share because of it. “As more customers move from large banks to smaller banks and credit unions, the overall customer satisfaction level for banks goes up as a matter of mathematics,” said Claes Fornell, ACSI founder. “As the smaller banks do a better job with customers and therefore attract more of them, customer satisfaction for banks on the whole gets a boost.”
Senate Vote Deals Blow to TAG Extension
Reuters
(12-13-12)
Efforts by small banks to protect a financial crisis-era deposit insurance program suffered a significant setback on Thursday when a bill to extend the program failed to survive a procedural vote in the U.S. Senate. The Transaction Account Guarantee (TAG) program insures bank deposits above the $250,000 normally covered by the Federal Deposit Insurance Corp in checking accounts that do not collect interest. It is set to expire at the end of the year.
Lobbyists for small banks have argued that letting the program end would lead U.S. companies to pull funds from bank accounts and invest elsewhere, roiling community banks that are still grappling with the sluggish economic recovery. The bill, sponsored by Majority Leader Harry Reid, would have extended the program for two more years. But it failed to garner the 60 votes needed to overcome a procedural challenge raised by Republican senators. The blow means it is increasingly likely TAG will expire at the end of the year. Republican leaders in the U.S. House of Representatives have said the program should end. Bank lobbyists had hoped a strong Senate vote to extend the program would be enough to sway House leaders.
Jobs
FINANTA - Chief Financial Officer (Philadelphia, PA)
FINANTA, a micro- and small-business lender, is seeking a CFO. Responsibilities include accounting, lending and management of the loan portfolio, reporting and contract compliance, board and committee work, staff management, research, buisness and technical assistance, and information controls. The CFO will have at least five years of professional experience, including managing the finances and administration of non-profits or similar entities; experience creating and driving the analytic framework for planning and managing organizational change in a highly entrepreneurial organization, and a Bachelor’s degree in Business, Management, Finance or similar field. FINANTA is accepting resumes for this position until January 15, 2013. Full details available here.
Central Bank of Kansas City - Business Development Officer (Kansas City, MO)
The Business Development Officer (BDO) will develop and strengthen the commercial loan referral network, using leads to achieve loan goals. The BDO will be responsible for exploring and pursuing new markets for loan products, preliminarily analyzing loan requests, and preparing written overviews and recommendations for the proposal. A BDO also is responsible for following regulatory guidelines and compliance procedures when initiating potential loan discussions, including government community reinvestment guidelines. The BDO will report directly to the chief lending officer. Also a BDO preliminarily reviews a commercial borrower's financial data and determines the company's creditworthiness. He or she also verifies credit references and ensures that a borrower has sufficient cash levels to repay loans pertaining to new products and services. We are looking for a friendly, energetic person who has the qualifications and skills that match today’s opportunity. This position is responsible for developing commercial loan leads which meet established lending requirements and provide maximum profitability to the Bank with a minimal risk. All referrals for prospective customers will come from sources outside of bank personnel, directors, and customers. This candidate will need to be self motivated, organized, and a good time manager. Weekly reports of potential customer calling activity will be required. Full details available here.
The CDBA Newsflash is a service of the Community Development Bankers Association (CDBA). For more information on other members and the work of CDBA please visit www.cdbanks.org. Or write to us at: 1444 I. Street NW, Suite 201, Washington D.C., 20005 or info@cdbanks.org.
Contact Name: Dana Weinstein; weinsteind@pcgloanfund.org; 202-689-8935 x32
