Independent Banker - May 2019 - 55

where the community bank seeks out resources on changes
from vendors, regulators, training and other sources.
" We're not an early adopter [of CECL], so we're still
evaluating, " he says. " Part of the pressure is how do you
maintain momentum of increased lending and efficiency. "
Bonvechio says Community National Bank hasn't
brought on new consultants, relying on its longtime
asset-liability management consultant to ensure risks
align. " It might mean we spend a little more time with tax
advisors before year-end to be sure of all the new changes
in tax code and maybe even more time with external
auditors discussing accounting rules and changes we'll be
subject to as the year unfolds, " she adds.
The exception is CECL, she adds. " We have, in the past,
been able to do the allowance process and calculation
using our own internal spreadsheets. It was complex and
complicated, but it worked, and we understood it and
could defend it and communicate to outside auditors
and regulators, " says Bonvechio, who now uses more
sophisticated software and external consultants.
Quentin Leighty, CFO at First National Bank of Las
Animas, Colo., is among the 41 percent of community
bank CFO respondents who haven't changed their use of
automated accounting solutions. The $362 million-asset
Taking deposits
The increasing challenge of gathering deposits is
one area where the vast majority of CFOs agree.
Nearly 73 percent report the stronger economy
has made deposit-taking more difficult, even in
communities that tend to lag behind in economic
trends. About two-thirds (68 percent) believe
higher rates will lead to new risks that will require
the CFO's expertise.
The increase in rates and competition for
deposits has led leadership at First American
Bank to train staff on appropriate deposit
recommendations after years of low interest in
deposits over the past eight to 10 years.
" We have staff so new that they had never even
seen a rate cycle, " says Brett Mills, the bank's
executive vice president and CFO. First American
Bank is an exception, with southeast New
Mexico's successful oil industry keeping the bank
flush with deposits.
How has your use of outside experts
(such as third-party accounting advisors)
evolved as financial reporting has become
more complex?
Most community banks' funding sources
have been heavily affected by recent
economic stimulus that could result in a
return to more traditional, albeit higher,
rate levels. How do you think this will affect
the CFO role?
0.85%
6.50%
Use fewer outside
advisors when educating
senior management on
financial reporting
19.51%
Use greater frequency
of outside advisors
when educating senior
management on
financial reporting
33.33%
Slight increase of outside
advisors when educating
senior management on
financial reporting
68.38%
Higher rates will lead
to new risks present in
the organization
40.65%
Same frequency of
outside advisors when
educating senior
management on
financial reporting
23.08%
Higher rates will not affect
the financial reporting of
the organization
Higher rates will lead to fewer
risks present in the organization
7.69%
It will not affect me,
because I have been
through it before
independentbanker.org Q 55
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