ABA Banking Journal - January/February 2016 - (Page 24)

>>> COMMUNITY ENGAGEMENT A PEER-TO-PEER Banking Investment Through the Financial Services Volunteer Corps, thousands of U.S. bankers are coaching emerging-market banking systems to maturity and growth. BY KERRY O'LEARY sk American bankers the underlying principles of their work and you will hear common themes: stimulating the economy, creating jobs, helping people succeed. Ask bankers in Kenya, Jordan or Albania, and you'll hear the same thing-but their financial environment is starkly different than that of the United States. The Financial Services Volunteer Corps-a 25-year-old nonprofit that connects banks and regulatory agencies in developing countries with partners and expertise in developed markets- has a mission to help countries like the ones mentioned above create and sustain stable financial frameworks and practices. FSVC sends volunteer experts in financial services to emerging markets around the world to carry out this mission. "My first experience with FSVC was as a volunteer," recalls Andy Spindler, FSVC's CEO. Then an SVP at the Federal Reserve Bank of New York, he journeyed to the former Yugoslavia during FSVC's infancy to help the country set up market-based financial systems after the fall of communism. "It was as if my entire career had been a prologue to giving this knowledge back," says Spindler, who has led the organization since 1993. To date, 24 ABA BANKING JOURNAL | JANUARY/FEBRUARY 2016 FSVC has leveraged nearly $90 million in funding from the U.S. government, private foundations and other sources- sending more than 8,500 experts on more than 2,700 missions in more than 35 countries to help build sound financial systems in emerging markets worldwide. Building these systems requires a back-to-basics approach. In developing countries with very few banks and histories of lending only to the wealthiest subset of the population, support for small-to-medium enterprises is often lacking. But these markets are key to long-term job creation, economic growth, healthy competition and innovation. As FSVC volunteers develop new policies and procedures for emerging markets around the globe, they draw from the fundamentals they learned back home in the United States. "The U.S. spirit of altruism is just as strong in the financial sector than any other sector in society," says Spindler. "And getting the banking sectors of these countries focused on strong, effective lending by providing the building blocks they need to do so is critically valuable." This was Dev Strischek's task in 2009 in Morocco. Strischek, SVP and senior credit policy officer at the Atlantabased SunTrust Banks, spent a week in Casablanca working under FSVC's direction with a primary bank ordered by the king of Morocco to establish new lines of business serving smaller commercial entities-a far-reaching objective for a country that had never before had such policies in place. "We were, in essence, systemizing the entire lending process, while working through the country's legal systems," explains Strischek. At the time, Moroccan banks had few if any customer credit histories, recording processes or even experience lending beyond a banker's kin. "Lenders had a personal knowledge of the borrower, but collateral was complicated," Strischek says. Strischek and FSVC started by teaching the bank how to implement an effective credit-approval process before moving to underwriting standards. This proved a challenge, since businesses lacked documented financials. The volunteer team's recommendations included understanding, budgeting and tracking the borrower's financial position. "Most of the teachings are really back to basics," explains Strischek. In Azerbaijan, located at the crossroads of Europe and Asia, an economic transition is happening as the country moves away from Russian influence and an oil-driven economy into a diverse, rapidly growing market. To aid in this transition, FSVC helped a private bank in the capital, Baku, home to a quarter

Table of Contents for the Digital Edition of ABA Banking Journal - January/February 2016

President's View
Picture This
Economic Outlook
Community Engagement
Cover Story: Train To Your Advantage
Filling The Trust Gap
Banking In The Sweet Spot
Safe Banking, Savvy Seniors
Human Resources
Agricultural Banking
Board Matters
ABA Compliance Center Inbox
Legal Briefs
From The States
Corporate Social Responsibility
Index of Advertisers

ABA Banking Journal - January/February 2016