Independent Banker - July 2020 - 20

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related to investments in our community.
" I'm not talking about just donations, although we all
pride ourselves on what we do there, but investments in the
community for foundations for the future, leadership and
development programs, financial literacy programs, and not
just giving money to things like that, but being involved in
things like that. "
Considering the impact that community banks have
within the communities they serve, when contemplating
its role as an independent institution, Gullickson points
out that a community bank also must ask itself if it has an
unstated obligation to the community to remain independent.
In short, if it sells, will the needs of its community
continue to be met in the same way?
" [Our] leadership and employees live directly in the communities
we serve, which fosters a long-term commitment
and dedication to enhancing the vitality and health of our
local communities, " says Jenna Kesecker, executive vice
president and chief financial officer at $327 million-asset
Jefferson Security Bank in Shepherdstown, W.Va. " We
believe in our community and feel strongly that remaining
an independent community bank provides the best opportunity
for our neighbors and local businesses to thrive. "
By exploring management and board succession plans
and looking at them in light of potential pitfalls (see sidebar),
community banks can better prepare to maintain their
independence and prime themselves to remain facets of
Why it's important to have a Plan B
Remaining an independent
community bank means having
to navigate competition,
compliance and technology
costs, not to mention outof-the-blue
challenges like
COVID-19. Yet, while economic
and environmental restraints may
play a role in a community bank's
decision to sell, experts point to
the intersection of liquidity and
leadership as the biggest hurdle
community banks should plan for.
" It's important for familyheld
banks, as the board
worries about succession
planning, [to consider] how
the current generation is
" We believe ... that
remaining an
independent
community bank
provides the best opportunity
for our neighbors and local
businesses to thrive. "
-Jenna Kesecker, Jefferson Security Bank
their communities. And, armed with these strategies, no
matter the market fluctuations, unforeseen environmental
developments or shifts in technology, banks that strive to
remain independent can find the wherewithal to do so.
" While there have been many challenges we have faced
through the years, " Kesecker says, " there have been just as
many opportunities to embrace, which have allowed us to
stand strong in the communities we serve. "
Colleen Morrison is a writer in Maryland.
going to get some monetary
value out of its ownership
while still leaving ownership
to the next generation, " says
Charles Gullickson, a partner
of Davenport, Evans, Hurwitz &
Smith, LLP in Sioux Falls, S.D.
" You need to identify sources
other than just the capital of the
bank to monetize some portion
of ownership's current assets, so
they can have the cash and the
liquid assets they need for the
end of their years. "
In addition, it's imperative that
community banks plan far ahead
so life's challenges don't take
them by surprise.
From environmental concerns
to unexpected developments
within the institution,
community banks
need to be
resilient, and
resilience is
achieved by having
planned for a
Charles Gullickson
multitude of scenarios.
" It comes up from time to time
that a significant owner passes
away in some untimely fashion
and there just hasn't been enough
planning for how to generate
enough cash to take care of the
spouse, the kids and the federal
estate taxes, " Gullickson says.
20 Q ICBA Independent Banker Q July 2020
Independent Banker - July 2020

Table of Contents for the Digital Edition of Independent Banker - July 2020
