Western Independent Banker - March/April 2009 - (Page 26)

continued from page 25 Please support the advertisers who helped make this publication possible. This evening’s events bear lessons that are consistent with some of the most important factors that private equity firms consider when evaluating non-control investments in banks during a stressed market. These lessons are: (1) emergencies always occur—it’s just a question of “when”; (2) make sure your contingency plans are up to date and that your team is regularly drilled and prepared to execute the contingency plans; and (3) when an emergency occurs, make additional preparations to withstand a worst-case scenario, whether you think it is necessary or not. You can never be over-prepared for an emergency and the severity is by definition unknown until it is over. A non-control private equity investor seeks to partner with current management to achieve its goals. By contrast, a control investor seeks to achieve their own goals, which may not be the same as those of management. Given this difference, non-control private equity investors must consider additional factors when evaluating a potential investment, especially given their lack of explicit control. First, investors want to ensure that management expects a credit or liquidity crisis to occur at any point in time, and management understands the risks embedded in its balance sheet. Banking is cyclical and only institutions that are prepared will survive the most severe crises. Does the bank have the proper risk management systems to identify problems before they arise, and specific strategies to avoid more serious problems? In today’s rapidly changing environment and ever more complex world of securities and derivatives, management needs to be nimble and flexible. Does the bank systematically review and improve its risk management systems as well as provide continuous risk management training? Just because asset problems have not occurred in 20 years does not mean that the risk management system purchased in 1988 is still suitable in today’s marketplace. The Only Solution For Your Processing Needs. To learn more, contact Todd Cline at 847-871-6005 or Todd.Cline@53.com EFT.53.com AT M C A R D P R O C E S S I N G | D E B I T C A R D P R O C E S S I N G | P O RT F O L I O M A N A G E M E N T C A R D P R O D U C T I O N | N E T W O R K G AT E WAY S E RV I C E S | AT M T E R M I N A L D R I V I N G C R E D I T C A R D P O RT F O L I O S E RV I C E S | C O R R E S P O N D E N T A N D C A S H L E T T E R S E RV I C E S 26 361695_Fifth.indd 1 www.wib.org Western Independent Banker 12/23/07 5:06:57 PM http://www.53.com http://www.wib.org

Table of Contents Feed for the Digital Edition of Western Independent Banker - March/April 2009

Western Independent Banker - March/April 2009 Contents A Message from the President & CEO Profitable Liquidity: Yes, You Can Non-Performing Assets: The Keep Versus Sell Decision Is BOLI the Way to Go? The Troubled Asset Relief Program and Its Eff ect on Executive Compensation TARP Money or Not, Secondary Offerings Belong in Your Plan 52nd Annual Conference Private Equity: Another Capital Option Strengthening Your Bank’s Bottom Line by Adapting to Difficult Times Managing Your Branch Network Capital Dealing with a Hard Insurance Market WIB Service Corporation Report WIB Calendar New Members Index of Advertisers Advertiser.com

Western Independent Banker - March/April 2009

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