ABA Banking Journal - December 2008 - (Page 22)

Community Banking Talk about current credit issues with veteran community bank lender Ed O’Leary at www.ababj.com Pass the Aspirin HEADACHE ONE Maintaining generosity in harder times he winter holiday season arrives, a time when many banks voluntarily, and by request, contribute time and money to deserving causes. Banks and customers are facing a tougher economy than in the past. “How is your bank approaching the needs of charitable groups this year?” we asked Aspirin prescribers in November. Remedy 3 Rheo A. Brouillard, president and CEO, Savings Institute Bank and Trust Co., Willimantic, Conn., $845.1 million-assets. There is increasing pressure on charitable dollars this year as state budgets are being reduced, unemployment increases, and regular donors are forced to reduce their level of giving. Since establishing SI Financial Group Foundation in 2004 we have distributed grants twice each year, in June and December. This past June, given the economy—in particular high gasoline prices and expected high heating oil prices—we reduced our level of giving. More funds were held for distribution in December in anticipation of making more and larger grants to help the food kitchens, the homeless shelters, and those entities that provide heating assistance. T capital improvement projects, the most recent being a major library expansion/renovation project that will help us better meet the demands of today’s education/information sharing challenge. We do not anticipate changing the way we respond to our communities’ requests for support. HEADACHE TWO Recruiting business lenders during a slump Remedy 1 Carolyn Mroz, president and CEO, Bay-Vanguard FSB, Baltimore, Md., $164 millionassets. With the holiday season just around the corner, we must consider how we can help in these troubled times. Since profitability and liquidity loom large, we must rethink how we can help those in need this season. Since we can’t donate large sums, we will try to help in other ways. This may include collecting canned goods from customers for holiday dinner gifts. We may also do a used clothing drive in our branches; the clothes can then be distributed through organizations like Salvation Army. We will also sell raffles for a local charity where the prize is a $100 gift certificate for a holiday meal. It is our way to play a small part in a larger cause. A year ago, many bankers told us that seasoned small business lenders could command top salaries at community banks. Bankers were talking about not only paying high salaries, but also signing bonuses. In the current environment, are small business lenders still in such demand? Or have circumstances brought some normality back? Remedy 4 Blair Hillyer, president and CEO, First National Bank, Dennison, Ohio, $167.7 million-assets. We have always supported area charities and not-for-profits. We have increased our donations some this year, mostly due to the fact that our profitability is up this year and will be down next year. We are expecting to cut back significantly in 2009. We have already notified some of our recipients of that fact. Remedy 1 Michael Magee, president and CEO, Independent Bank, Ionia, Mich., $3.2 billion. Overall the demand for good small business lenders remains strong but the economic environment has brought normality back. Downsizing at the large banks in Michigan has resulted in more commercial lending personnel being available and has had a stabilizing effect on salaries and signing bonuses. Thus I believe it is a good time for community banks to attract top talent. I do believe longer term that there will be a shortage of lenders who have had formal credit training programs at their banks. In the past, business development skills were valued more than credit skills and thus a number of the larger banks no longer offer credit training programs locally. As a result, hiring opportunities over the next year or so may be an unprecedented window for the community banks. Remedy 2 Albert Garrett, president and CEO, Robertson Banking Co., Demopolis, Ala., $232 millionassets. Although we do not expect to decrease our charitable giving this year (which takes place all during the year) we don’t plan to increase it in December either. Next year’s budget could possibly include a smaller allowance for charitable giving. Remedy 5 Marvin Hefti, chairman, First State Bank, Scottsbluff, Neb., $204.1 million-assets Our charitable giving tends to be spread throughout the year, with most contributions repetitive. We try to honor most requests and I believe we do well more than 90% of the time. Many of the requests we receive are for support of community events. Major donations tend to be for local 22 DECEMBER 2008/ABA BANKING JOURNAL Subscribe at www.ababj.com http://www.ababj.com//component/option,com_myblog/category,Talking Credit/Itemid,140/ http://www.savingsinstitute.com http://www.bayvanguard.com http://www.independentbank.com http://www.fnbdennison.com http://www.robertsonbanking.com http://www.fsbcentral.com http://www.ababj.com

Table of Contents for the Digital Edition of ABA Banking Journal - December 2008

ABA Banking Journal - December 2008
Contents
Editor’s Column
Cover Story
ABA Resources
ABA Chairman’s Position
Community Banking
Pass the Aspirin
The Bank that Hates "Customers"
"Ivan the Terrible"Wreaks Havoc, but Adds New Business Line
New Twist on Philanthropy:the "Second-Chance" Account
Risk Management
Tech Topics
Webnotes
Compliance Clinic
MailBox
Banker’s Mart
To Advertise/Index of Advertisers
The Economy

ABA Banking Journal - December 2008

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