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MID-CONTINENT BANKER (iSSN 0026-296X) The Financial Magazine of the Mississippi Valley & Southwest AUGUST, 1982 Rural Bank Invests In Its Community — See Page 44 000,000 THE ECONOMY BOOSTER ONE MILLION DOLLARS https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Is Proud To Announce Our Economy Booster Program WE BELIEVE SO STRONGLY IN OUR LOCAL COMMUNITIES, THAT WE WILL INVEST . . . ONE MILLION DOLLARS ($1 ,0 0 0 ,0 0 0 ) IN LOANS AT AN INCREDIBLE IDA COUNTY STATE BANK (Security With Satisfaction M E M B E R F D IC ONE MILLION DOLLARS The Ida County State Bank Liberty’s Remote Data Capture is MORE THAN cars, trucks and planes. It’s Electronic Transmission over phone lines, too. For L ib erty’s processing customers, ground and air transport of paper is being replaced by electronic transmission over phone lines at 4,800 characters per second. That means it takes no more than one minute to send 285,000 bits of inform ation about balances, checks, deposits, loan payments and changes of address. With special econom ical hardware installed in the correspondent bank, connected to L ib erty’s Data Center, all inform ation for processing is transm itted at the close of business each day. The updated file is returned to the bank before opening the next morning. No physical transport of items is necessary and the bank retains in-house possession of its own documents. Call L ib erty’s data people (405/231-7186) for the full story of “ remote data capture” — another evidence of how M iddle Am erica is moving and Liberty is leading the way. We Care About You LIBERTY THE BANK OF MID-AMERICA Liberty National Bank and Trust Company • P.O. Box 25848 Oklahoma City, Oklahoma 73125 • 405/231-7186 • Member FDIC MID-CONTINENT BANKER is published monthly by Commerce Publishing Co., 408 Olive, St. Louis, Mo. 63102, August, Vol. 78, No. 8. Controlled-circulation postage paid at St. Louis, Mo., and at additional mailing offices. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis CONDENSED STATEMENT OF CONDITION AS OF JUNE 30, 1982 RESOURCES Cash and Due from Banks............................................................................................... U. S. Treasury Securities................................................................................................. Obligations of States and Political Subdivisions.......................................................... Federal Reserve and Corporate Stock........................................................................... Federal Funds Sold and Securities Purchased Under Agreements to Resell........... Loans.................................................................................................................................. Less: Valuation Portion of the Reserve For Possible Loan Losses.......................... Bank Premises and Equipment....................................................................................... Other Real Estate............................................................................................................. Customers’ Acceptance Liability................................................................................... Accrued Income Receivable........................................................................................... Other Assets..................................................................................................................... TOTAL....................................................................................................................... LIABILITIES Deposits.................................................................................................................... Federal Funds Purchased, Securities Sold Under Agreements to Repurchase Acceptances Outstanding...................................................................................... Dividend Payable July 1, 1982............................................................................... Special Dividends Payable..................................................................................... Accrued Taxes, Interest and Expenses................................................................ Deferred Income Tax Portion of the Reserve For Possible Loan Losses.......................................................................................... TOTAL LIABILITIES....................................................................................... CAPITAL ACCOUNTS Capital Stock....................................................................................................... Surplus................................................................................................................. Undivided Profits................................................................................................ Capital Portion of Loan Loss and Securities Reserves, TOTAL CAPITAL ACCOUNTS............................... TOTAL...................................................................... https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis $ 254,325,248.97 529,062,519.92 57.477.066.06 1,509,294.88 55,900,000.00 1,068,180,663.80 9,482,097.12 1,058,698,566.68 16,446,527.16 6,181,711.22 326,620.48 30,169,072.10 11.042.477.07 $ 2,021,139,104.54 $ 1,534,884,963.44 263,560,000.00 326,620.48 5,347,680.00 2,158,296.94 29,807,612.59 _______ 732,027.20 $ 1,836,817,200.65 $ 2,800,000.00 47,200,000.00 132,665,866.47 1,656,037.42 $ 184,321,903.89 $ 2,021,139,104.54 CO RRESPO N D EN T Q U IZ 1. Who has the fastest-growing Correspondent Bank Department in the South? 2. Who was the first to offer seminars on new hanking regulations and laws featuring leading national advisors and government officials? 3. Who continues to offer those seminars and regular updates on how to maximize profits at no cost to correspondents? 4. Who offers correspondents special insurance programs at low group rates? 5. Who is big enough to handle every correspondent need, yet small enough to handle each one of them, one at a time, with expert personal attention? 6. Who gives you senior experience and expertise on everything.. .from transit, data processing, Visa and MasterCard, draft collection, investments, federal funds, safekeeping, credit assistance, loan participation, trust services, wire transfers and business referrals...to seasoned advice on advertising, marketing, personnel training and even the design and 4 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 Surefire wire Money management. It’s a m atter of transferring the right amount to the right account at the right time. It’s one of the things we do best at Commerce Bank. The money management specialists at Commerce deal in a large volume of transfers averaging about one billion dollars a day. We have handled as many as one thousand transfers in a single day. In a business where mil lions of dollars change hands each hour, you can’t afford a bank that makes mistakes. In some cases we’ll follow a 8 wire transfer up with a phone call to make sure that funds have been deposited to the proper account. And, if there is a problem, it is resolved quickly, usually within the same business day. Fast, accurate service from friendly professionals. We think it’s the surefire way to keep our #) Commerce Bank of Kansas City correspondents happy. (816) 234-2000 • 10th & Walnut • Kansas City, MO 64141 g% w y MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • jwi MEMBER FDIC 5 First Commerce Corporation and First National Bank o f Commerce New Orleans C O N S O LID A T E D S TA T E M E N T OF IN C O M E (In Thousands) INTEREST INCOME Interest and fees on loans and leases.............................. Interest on obligations of states and political subdivisions Interest on other investment securities ............................ Dividends on corporate stock............................................. Interest on short-term investments and bank deposits . .. Total interest incom e....................................................... INTEREST EXPENSE Interest on NOW account deposits.................................... Interest on savings deposits............................................... Interest on other consumer time deposits........................ Interest on time deposits of $100,000 and o v e r............... Interest on foreign branch time deposits.......................... Interest on short-term borrowings...................................... Interest on long-term debt ................................................. Total interest expense..................................................... Six Months Ended June 30, 1981 1982 $33,559 2,581 15,715 643 19,886 72,384 $32,284 2,293 17,681 857 22,148 75,263 578 2,435 5,463 15,937 1,721 24,079 663 50,876 OPERATING EXPENSE Salary expense............................................................................. Employee benefits ........................................................................ Total personnel expense.......................................................... Net occupancy expense .............................................................. Equipment expense...................................................................... Litigation settlement...................................................................... Other operating expense ............................................................ Total operating expense........................................................... 888 2,307 6,838 11,736 829 23,516 495 46,609 25,775 1,560 24,215 1,857 1,651 547 949 2,225 7,229 31,444 8,238 2,049 10,287 1.835 1,892 6,116 20,130 INCOME BEFORE INCOME TAX EXPENSE, SECURITIES TRANSACTIONS AND EXTRAORDINARY ITEM ..................... INCOME TAX EXPENSE ................................................................ 11,314 3,185 10,276 2,650 8,129 (5,528) 2,543 (2,985) 5,144 7,626 (11,626) 5,336 (6,290) $ 5,144 $ 2,404 NET INTEREST INCOME ..................................................... PROVISION FOR LOAN LO SSES....................................... NET INTEREST INCOME AFTER PROVISION FOR LOAN LOSSES.......................................................... OTHER INCOME Service charges on deposit accounts .............................. Credit card merchant discounts......................................... Computer services.............................................................. Trust department fe e s ......................................................... Other operating revenue..................................................... Total other incom e.......................................................... INCOME BEFORE SECURITIES TRANSACTIONS AND EXTRAORDINARY IT E M ............................................................ Investment securities transactions ............................................. Income tax effect ......................................................................... Net securities lo sse s................................................................ INCOME BEFORE EXTRAORDINARY ITEM .............................. EXTRAORDINARY IT E M ................................................................ NET INCO M E................................................................................... EARNINGS PER SHARE Primary Income before securities transactions and extraordinary item Income before extraordinary ite m ........................................... Net income ............................................................................... Fully diluted Income before securities transactions and extraordinary item Income before extraordinary ite m ........................................... Net income ............................................................................... WEIGHTED AVERAGE COMMON SHARES OUTSTANDING . . 6 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis $ $ $ $ $ $ 2.53 1.60 1.60 2.25 1.44 1.44 3,216 24,387 2,190 M e m b e r FDIC C O N S O LID A T E D B A LA N C E SHEET (In Thousands) June 30, ASSETS Cash and due from banks......................................................... Due from banks - t im e .............................................................. Investment securities: U.S. treasury securities ......................................................... Obligations of U.S. agencies and corporations................... Obligations of states and political subdivisions................... Other bonds, notes, debentures and corporate stock ....... Total investment securities (market value $287,785,000 and $297,722,000, respectively) .................................. Other short-term investm ents................................................... Loans and leases ...................................................................... Allowance for loan losses ..................................................... Unearned income .................................................................. Total net loans and leases ............................................... Bank premises and equipment................................................. Accrued interest on securities and loans ................................ Other assets ............................................................................... Total assets ........................................................................ 1982 $ 155,640 152,509 214,894 5,890 61,119 15,382 297,285 119,001 465,192 (12,713) (6,482) 445,997 18,606 19,994 7,237 $1,216,269 1981 $ 250,977 97,164 220,361 10,017 61,777 18,861 311,016 118,550 417,031 (10,269) (9,949) 396,813 14,327 18,528 _ 13,564 $1,220,939 22,197 1,573 1,584 564 882 1,540 6,143 LIABILITIES Deposits in domestic banking offices: Demand deposits ......................................... NOW account deposits ................................ Savings deposits........................................... Other consumer time d ep osits..................... Time deposits of $100,000 and o v e r........... 28,340 7,294 1,752 9,046 1.481 1.698 1,114 4.725 18,064 1,336 1,068 $ $ $ 2.51 0.44 0.79 $ $ $ 2.13 0.44 0.72 3,039 Foreign branch time deposits over $100,000 . Total deposits............................................. Short-term borrowings ...................................... Accrued interest payable.................................. Accounts payable and other accrued liabilities Long-term debt ................................................. Total liabilities ........................................... STOCKHOLDERS' EQUITY Common stock, $5 par value Authorized - 10,000,000 shares Issued - 3,282,898 and 2,910,049 shares, respectively Capital surplus.................................................................... Retained earnings.............................................................. Less - 57,910 and 61,078 shares of common stock in treasury, respectively, at c o s t.................................... Total stockholders' equity ...................................... Total liabilities and stockholders’ equity ............... $ 345,940 36,052 85,576 115,791 190,025 773,384 11,192 784,576 326,740 8,431 6,701 11,227 1,137,675 16,414 42,875 20,646 79,935 (1,341) 78,594 $1,21è,269 $ 447,742 26,464 89,816 98,945 _ 217,204 880,171 21,798 901,969 199,883 9,183 23,773 14,386 1,149,194 14,550 35,300 23,318 73,168 (1.423) 71l745 $1,220,939 These financial statements are preliminary unaudited figures, and are subject to adjustment which may or may not be material MID-CONTINENT BANKER for August, 1982 Hang up the phone on tim e-sharing costs and make one final phone call that w ill buy the definitive software package in A sset/L iab ility Management - The Baker Models1 • D eveloped by Dr. J a m e s V. Baker, noted author, lecturer and adviser • Inexpensive com pared to th e com petition • O perable on various m icrocom puters • Com pletely user-friendly • Training is included in the cost For m ore inform ation on T he B a k e r A sse t/L ia b ility Models,™ call (4 0 5 ) 2 3 5 -2 1 2 0 . O r m ail th e coupon below . Dr. Ja m e s V. B aker is P resident and Chief Executive Officer of Ja m e s B aker & Company. His book, A sset/Liability M anagem ent by ABA has been recognized as perhaps the m ost authoritative work on the subject. Yes, I w ould lik e to receive your sam p le b o o k let and ad d itio n al inform ation. N a m e ________________________________________ T itle _________________________________________ C o m p an y _____________________________________ S tre e t A d d re s s ________________________________ C ity /S ta te _________________________ Zip. P h o n e _____________________________ S end coupon to J a m e s B a k e r & Company, S u ite 1 0 5 0 , City C en ter B uilding, O klahom a City, OK 7 3 1 0 2 . JAM ES BA K ER &. COMPANY https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 30507-8A CONSOLIDATED BALANCE S H E E T-June 30,1982 Who’s built up more equity capital than any other financial institution in the tri-state area? (dollars in thousands) NBD BANCORP BOARDOF DIRECTORS Robert M. Surdam Chairman of the Board ASSETS The answer is easy. Its NBD Bancorp. As of June 30, 1982, our Total Sharehold ers’ Equity was more than $700 m illion. That’s more equity capital than any other financial institution in M ichigan, Indiana or O hio. O ur strong capital position means added protection for the deposi tors of NBD Banks. Our lead bank, National Bank of Detroit, was established nearly 50 years ago. Since then our e qu ity base — most of w hich has com e from earnings — has grow n consistently. W e’ve reinvested these earnings in the company, making it possible for us to provide more loans, make more investm ents and meet more of the financial needs of the businesses and individuals in the com m unities we serve. Today the NBD Bancorp family includes 18 banks with more than 200 branch locations.The same growth that has built our strong capital base has enabled us to pay out about 1/3 of our earnings to shareholders in the form of cash d ivi dends— dividends that have increased steadily over the past 15 years. And w e’ve consistently maintained high quality loan and investment portfolios.That’s the kind of growth that benefits both our depositors and our shareholders. For more information about NBD Bancorp, w rite to our C orporate Com m unications Department, or call (313) 225-2596. NBD Bancorp, Inc. is listed on the New York Stock Exchange (ticker symbol NBD). 957,963 Cash and Due From Banks...................................... $ Interest Bearing Deposits........................................ 2,453,878 Investment Securities— At Amortized Cost (Market value $1,124,530).................................... 1,351,196 Trading Account Assets— At Lower of Cost or Market (Market value $29,501)........................... 29,361 Money Market Investments..................................... 1,126,427 Loans: Commercial............................................................ 3,555,763 Real Estate— Construction................................... 26,101 Real Estate — M ortgage........................................ 1,220,398 417,227 Consumer............................................................... Foreign.................................................................... 646,708 5,866,197 Allowance For Loan Losses................................. (72,260) Unearned Income.................................................. (42,487) Total Loans.......................................................... 5,751,450 Lease Financing........................................................ 33,692 Premises and Equipment (at cost less 132,927 accumulated depreciation of $103,775)............. Customers' Liability on Acceptances..................... 456,214 Other Assets............................................................... 250,544 Total Assets.............................................. $12,543,652 Charles T. Fisher III President Joseph G. Conway Vice Chairm an of the Board Richard H. Cummings Vice Chairm an of the Board A. H. Aymond D irector and Form er Chairman C onsum ers Power Com pany Herbert H. Dow D irector and C orporate S e cretary The Dow Chem ical Com pany David K. Easlick P resident The M ichigan Bell Telephone Com pany Bernard M. Fauber Chairman of the Board K m a rt C orporation Robert W. Hartwell President C liffs E le ctric S e rvice Com pany LIABILITIES AND SHAREHOLDERS EQUITY Deposits: Demand................................................................... $2,122,230 Savings.................................................................... 1,451,032 Tim e......................................................................... 674,983 Certificates of Deposit.......................................... 1,107,721 Money Market Certificates................................... 1,677,555 Foreign O ffice ........................................................ 1,728,008 Total Deposits................................................ 8,761,529 Short-Term Borrowings............................................. 2,292,226 Liability on Acceptances.......................................... 456,214 186,946 Accrued Expenses and Sundry Liabilities............. Long-Term Debt......................................................... 124,677 Total Liabilities.............................................. 11,821,592 Shareholders' Equity: Preferred Stock— No Par Value; 1,000,000 Shares Authorized, None Issued.................. Common Stock— Par Value $6.25; 20,000,000 Shares Authorized, 12,265,747 Shares Issued........................................................................ 76,661 Capital Surplus........................................................... 183,659 Retained Earnings..................................................... 465,221 Accumulated Translation Adjustm ent................. (3,342) Less Treasury Stock at cost— 6,323 Shares. . . ._______(139) Total Shareholders' Equity............................. 722,060 Total Liabilities and Shareholders’ Equity.......................... $12,543,652 Assets carried at approximately $761,000,000 (including U.S. Treasury Securities carried at $30,000,000) were pledged at June 30, 1982 to secure public deposits (including deposits of $46,000,000 of the Treasurer, State of Michigan) and for other purposes required by law. Outstanding standby letters of credit at June 30, 1982, approxi mated $142,000,000. Joseph L. Hudson, Jr. Chairman The W ebber Foundations Richard Manoogian President M asco C orporation Agnes Mary Mansour, RSM President M ercy C o llege of D e troit Wade H. McCree, Jr. Lewis M. Sim es Professor of Law U n iversity of M ichigan Don T. McKone Chairm an of the Board Libbey-O w ens-F ord Com pany James H. McNeal, Jr. President The Budd Com pany Thomas A. Murphy D irector and Form er Chairman G eneral M otors C orporation Irving Rose Partner, Edward Rose & Sons Arthur R. Seder, Jr. Chairm an and President Am erican N atural Resources Com pany Robert W. Stewart Chairman of the Board Prim ark C orpo ration and M ichigan C o nsolidated Gas Company Peter W. Stroh President The Stroh B rew ery Com pany ADVISORY MEMBERS AFFILIATES National Bank of Detroit and its international banking and financing subsidiaries, International Bank of Detroit and National Bank of Detroit, Canada; NBD Commerce Bank, Lansing; NBD Port Huron Bank; NBD Troy Bank; NBD Dearborn Bank; Grand Valley National Bank, Grandville; First State Bank of Saginaw; NBD Portage Bank; Peoples Bank & Trust of Alpena; Farmers & Merchants National Bank in Benton Harbor; West Michigan Financial Corporation and its banking subsidiaries, The Cadillac State Bank, First National Bank of Evart and NBD Northwest Bank, Kalkaska; National Ann Arbor Corporation and its banking subsidiaries, National Bank and Trust Company of Ann Arbor and Monroe County Bank; The Roscommon State Bank; Wolverine State Bank, Sandusky; American Business Finance, Inc.; NBD Mortgage Company; NBD Insurance Company; NBD Financial Services of Florida, Inc.; Michigan Capital and Service, Inc; NBD Financial Services of Michigan, Inc. (All banks members FDIC) Martha W. Griffiths Partner, G riffith s & G riffith s John R. Hamann Form er President The D e troit Edison Com pany Walton A. Lewis Chairman of the Board Lewis & Thom pson Agency, Inc. Robert B. Semple D irector BASF A m erica C orporation BANCORP 611 Woodward Avenue, Detroit, Michigan 48226 8 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 Liberty Bank and Trust is a full service bank with $1 billion in assets and 36 branches. It was chartered in 1854. “To meet an increasing customer demand, we began issuing money orders for the first time in 1970. We used a national money order vendor. In 1976 we switched to Citicorp Remittance Service, because the CRS system gave us tight audit controls. It also offered a 4-part form check which was compatible with our systems, and displayed our institutional identity on the check. The switch to Citicorp Remittance Service gave Liberty — • Reduced back-office workload. • Reconcilement —branch by branch, item by item. • Better customer service —with toll-free number. • Immediate on-line item inquiry. • Stops that can be placed by phone (allowing for re-issue on the spot). • Quick and easy photocopies. The CRS service helped us im prove our branch profitability in this very competitive county. With their variable pricing options, we were able to select a price which best fit our operational and financial needs. We analyzed the available major services, and decided that CRS more than kept their promise. They took the work, and we took the credit.” Over 600 financial institutions are already using CRS’s innovative, hightech disbursement service. You, too, can reduce your back-office work-load, improve your customer service and increase your bottom line. Simply call 1-800-223-7522. Or write Citicorp Remittance Service^ Department 145 425 Park Avenue, 4th Floor, New York, NY 10197. Sincerely, Philip E. Hunter Senior Vice President CITICORP REMITTANCE SERVICE'” You take the credit. W e take the work. Citicorp Services, Incorporated A Subsidiary of Citicorp TM— A Service Mark of Citicorp https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis CITICORP© MID-CONTINENT BANKER The Financial Magazine of the Mississippi Valley & Southwest Volume 78, No. 8 August, 1982 FEATURES 21 PROBLEMS FACING FARMERS W hen it comes to planning estates 24 FINANCIAL FUTURES A tool for ag banks? 26 BANKING GROUP FORMED Purpose: to buy farm loans 34 BANK HAS HUGE EFFECT ON COMMUNITY Through thorough involvem ent program 36 IMPROVING DETERIORATING AREA A four-bank project 40 NEIGHBORHOOD REHABBING O ne bank’s philosophy 66 KENTUCKY CONVENTION PROGRAM National, state bankers to speak DEPARTMENTS 12 THE BANKING SCENE 16 FED ANSWERS QUESTIONS 18 BANKING WORLD REGIONAL MEETINGS 51 KANSAS 61 MISSOURI STATE NEWS 70 INDIANA 70 MISSISSIPPI 68 ARKANSAS 70 KENTUCKY 70 NEW MEXICO 69 ILLINOIS 70 LOUISIANA 68 ALABAMA 72 TENNESSEE 70 OKLAHOMA 72 TEXAS EDITORS Ralph B. Cox ....... Publisher Lawrence W. Colbert Assistant to the Publisher Rosemary McKelvey .. Editor Jim Fabian ___Senior Editor Eleanor Wainwright Pamela Walsch Assistant Editor Editorial Assistant MID-CONTINENT BANKER Editorial/Advertising Offices St. Louis, Mo., 408 Olive, 63102. Tel. 314/4215445; Ralph B. Cox, Publisher; Marge Bottiaux, Advertising Production Mgr. MID-CONTINENT BANKER is published monthly by Commerce Publishing Co., 408 Olive St., St. Louis, Mo. 63102. Printed by The Ovid Bell Press, Inc., Fulton, Mo. Controlled circulation postage paid at St. Louis, Mo., and at additional mailing offices. Subscription rates: Three years $27; two years $20; one year $12. Single copies, $2.50 each. Foreign subscriptions, 50% additional. 10 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Commerce Publications: American Agent & Bro ker, Club Management, Decor, Life Insurance Selling, Mid-Continent Banker, Mid-Western Banker and The Bank Board Letter. Officers: Donald H. Clark, chairman emeritus; Wesley H. Clark, president and chief executive officer; James T. Poor, executive vice president and secretary; Ralph B. Cox, first vice president and treasurer; Bernard A. Beggan, David A. Baetz, Lawrence W. Colbert and W illiam M. Humberg, vice presidents. Convention Calendar Aug. 18-27: Conference of State Bank Supervisors School for Senior Personnel, Norman, Okla., Uni versity of Oklahoma. Aug. 22-25: Independent Bankers Association of Amer ica Seminar/Workshop on the One-Bank Holding Company, San Francisco, San Francisco Hilton/ Tower. Aug. 22-Sept. 3: Conference of State Bank Supervisors Advanced School, Amherst, Mass., University of Massachusetts. Aug. 29-Sept. 3: Independent Bankers Association of America Seminar for Senior Bank Officers, Boston. Sept. 4-7: 50th Assembly for Bank Directors, Colorado Springs, Colo., the Broadmoor. Sept. 7-10: Bank Administration Institute Cash Man agem ent Conference, New Orleans, Fairm ont Hotel. Sept. 12-14: Kentucky Bankers Association Annual Convention, Louisville, Galt House. Sept. 12-15: ABA National Bank Card Convention, Miami, Fontainebleau Hotel. Sept. 12-15: ABA National Personnel Conference, Atlanta, Hyatt Regency Atlanta. Sept. 15-17: ABA 1982 Bank Planning Workshop, Den ver, Denver Marriott City Center. Sept. 19-21: Independent Bankers Association of America Commodity Marketing Seminar, Chicago, Bismarck Hotel. Sept. 19-22: National Association of Bank Women Annual Convention, Los Angeles, Los Angeles Bonaventure. Sept. 19-23: Bank Marketing Association Trust Market ing Conference, San Francisco, Fairmont Hotel. Sept. 19-Oct. 1: ABA National Installment Credit School, Norman, Okla., University of Oklahoma. Sept. 19-Oct. 1: Conference of State Bank Supervisors Intermediate School, Boulder, Colo., University of Colorado. Sept. 26-30: Consumer Bankers Association Annual Conference, Marco Beach, Fla., Marco Beach Hotel/ Villas. Sept. 26-Oct. 8: Conference of State Bank Supervisors Advanced School, DeKalb, 111., Northern Illinois University. Sept. 29-Oct. 1: ABA Risk & Insurance Management in Banking Seminar, Denver, Denver Marriott/City Center. Oct. 6-8: Dealer Bank Association Senior FundsManagement Roundtable/1982 Mid-Year Confer ence, Washington, D. C., Hyatt Regency on Capitol Hill. Oct. 9-15: ABA Graduate School of Bank Investments, Norman, Okla., University of Oklahoma. Oct. 9-15: ABA National School of Bank Investments, Norman, Okla., University of Oklahoma. Oct. 10-15: Independent Bankers Association of Amer ica Bank Executive-Development Seminar, Muncie, Ind., Ball State University. Oct. 16-19: ABA Trust Management School, Evanston, 111., Northwestern University. Oct. 16-20: ABA Annual Convention, Atlanta. Oct. 24-27: Bank Marketing Association Annual Con vention, Phoenix, Phoenix Civic Center. Oct. 24-27: Conference of State Bank Supervisors Seminar for Deputy Supervisors/Senior-Management Personnel, Boulder, Colo., University of Col orado. Oct. 24-29: ABA National Commercial Lending Gradu ate School, Norman, Okla., University of Oklahoma. Oct. 28-29: Dealer Bank Association Public Finance Seminar, Dallas, Fairmont Hotel. Oct. 31-Nov. 2: Independent Bankers Association of America Seminar/Workshop on One-Bank Holding Company, New Orleans, New Orleans Marriott Hotel. Oct. 31-Nov. 3: Robert Morris Associates Fall Confer ence, Bal Harbour, Fla. Nov. 2-5: Bank Administration Institute Mini-Micro Computers Conference, Dallas, Loew’s Anatole Hotel. Nov. 3-4: Consumer Bankers Association Most Com mon Violations Found in Consumer-Credit Ex aminations, Atlanta, Southern Conference Center. Nov. 3-5: ABA International Banking Conference, New York City, Grand Hyatt New York. Nov. 4-5: ABA International Personnel InformationExchange Group, New York City, Grand Hyatt New York. MID-CONTINENT BANKER for August, 1982 Does your correspondent bank make investments that bring the desired return? We d o overnight or over a decade. It’s a big job, staying attuned to all domestic and international money markets. It’s a job for experts who devote all their time to the task. Experts who have access to the latest com munications and computer equip ment. The experts in Mercantile’s Bond/lnvestment Department. No matter how long you want your in vestment capital tied up, we can pro vide a plan that suits your needs. Overnight Investments. Federal funds. Repurchase agreements. Reverse-repurchase agreements. Short-term Investm ents. US. Treasury bills. Agency obligations. Tax-free municipal notes. Commercial paper. Large certificates of deposit. Banker’s acceptances. And almost any other type of money market instrument. Longer-term Investments. U S. Treasury Bonds. Agency obligations. Tax-free municipals and other long term debt instruments. Safekeeping Services. The last thing you probably need is the inconven ience and risk of shipping certificates back and forth. Save that hassle by keeping your certificates in our vault: we’ll provide computer reports for your records. Just Plain Good Advice. No, we can’t make any final decisions for you. But we can help you make deci C orrespondent Banking Division M ercantile Trust Company N.A. St. Louis, MO (314) 425-2404 MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis sions wisely. By keeping you up-to-the minute on constantly-changing money and securities markets. That’s why we keep a service office on Wall Street. And why we’ve invested in computers. And keep access to the Federal Reserve Book Entry System. All these keep you informed and let us execute your buy/sell orders im mediately. They’re your best guaran tee of desired return. What’s more, Investment is just one of our correspondent services. So call a Mercantile Banker today. W e’re w ith you. M E R C nnT IIE B R fK 11 The Banking Scene By Dr. LEWIS E. DAVIDS Illinois Bankers Professor of Bank Management Southern Illinois University, Carbondale Financial Technology vs. Myopic Regulators alm ost 360-degree change in policy has taken place. W hile th e early dem ise of th e con cept of plastic deb it/cred it cards is not foreseen, some new technological d e v e lo p m e n ts p o in t to a sh iftin g in m o d u s o p e ra n d i. E x is tin g fu n d transm ission technology perm its read ing of voice patterns, scanning of fing erp rin ts by cathode tubes and other c o n firm in g te c h n iq u e s , su c h as e y e b a ll- s c a n n in g a n d p r e s s u r e sensitive signature reading. W hen any com bination of m ethods is used, the need for a plastic card for en try for a credit or d ebit transaction no longer exists. But m ore than that, we are seeing a recognition by regulatory agencies of th e necessity to perm it the financial W e are seeing a recognition segm ents of a regulated industry to by regulatory agencies of the com e out of the D ark Ages. It is possi necessity to perm it the finan ble that some of these regulators have tra v e le d a b ro a d to see how m u ch cial segments o f a regulated fu rth er advanced banking is in a n u m industry to come out o f the b e r of nations than it is in th e U. S. France is well on its way in th e u til Dark Ages. ization of w hat is called th e “sm art chip. ” W hile this plastic card looks like The situation is even m ore com pli a typical U. S.-style cred it/d eb it card, it has a greater am ount of electronic cated by th e fact th at jo in t deb it/cred it cards now are in place. Some joint flexibility. But th e “sm art c h ip ,” w ith cards are identified and identifiable as only a four-K or eight-K m em ory, probably will be replaced soon w ith d eb it or c re d it cards by th e casual chips w ith m any m ultiples of th e ex viewer, b u t some are not. isting K -m em ory factor. In addition, one m ust keep in m ind U n til now , G re e k b a n k e rs have the changing technological stru ctu re of retail gasoline sales. In a n u m b er of been considered com petent, b u t not at E uropean countries, th e typical gaso th e e d g e of e m e rg in g tech nology. line station is unm ann ed and is acti H ow ever, Bank of Thessalia in G reece has leapfrogged over m any banks by vated by an e le c tro n ic c re d it/d e b it installing thousands of video-text te r card. If such a d evelopm ent takes hold minals in business locations. Among in the U. S., as is likely, th e com pany th e services video-texts p e rm it are th a t e lim in a te d c re d it-c a rd service buying and selling currency, taking w ould be forced to w ork out som e loan applications and providing typical alternative system. Bankers w ith m em ories going back banking activities norm ally found at to the early 1930s recall that th e gaso hom e offices and branches. About the line industry was th e first m ajor d e only service it doesn’t provide is safe deposit. v e lo p e r o f s p e c ia l-p u rp o s e c r e d it cards. Thus, w ithin half a century, an Bank of Thessalia has taken a som e H E D E C IS IO N by a m ajor oil firm to discontinue its credit-card operation has in terestin g im plications for banking. It was stated that th e oil firm ’s c re d it-c a rd o p e ra tio n a d d e d about th re e cents p e r gallon to th e cost of gasoline. Thus, in theory, this com pany should be able to price its gaso line th ree cents low er than com peti tors who continue to offer credit-card plans. At a tim e w hen credit-card usage is increasing, one w o n d ers w h e th e r a two-price stru ctu re may develop, as has occurred in som e foreign countries — one for cash and another for charge purchases. O f course, th e latter w ould be m ore expensive to th e consum er. T 12 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis w hat different stance from some banks in the U. S. that have tried to build hom e-banking term in al system s. In effect, the G reek institution has estab lished thousands of branches in public bu sin ess locations, thus en su rin g a m uch g reater utilization of term inals than norm ally w ould be the case w ith A m erican hom e-banking program s. T he G reek bank leases its term inals to gro cery stores, gas stations and shopping centers. Leasors offer the s e rv ic e at no c o st to c u s to m e rs . H ow ever, the free charge to custom ers doesn’t m ean businesses will find the operation unprofitable. F or one thing, th e serv ice sh o u ld in c re a se traffic volum e. Perhaps the m ajor problem o f myopic regulators is their mind-set in failin g to recognize the fact that they lack the a b il ity to regulate effectively in to day's dynamic age o f technol ogyBut m ore than that, part of the sys tem consists of a revenue-producing advertising device that also provides inform ation about restaurants, hotels and transportation systems. T he G reek system seem s to have a lot m ore w orking for it than do its A m erican co u n terp arts. P art of th e dilem m a p reventing A m erican banks from offering such innovative services are regulations such as the Bank H old ing Com pany Act and Regulation Y, w hich rem ove some of the attractive ness of such devices, including dis pensing of public-interest advertising. Am erican bank H Cs are quite astute and no doubt will be able to circum ven t federal regulations through n u m erous techniques such as not ow n ing, b ut leasing, devices — or chang ing th e legal stru ctu re that inhibits MID-CONTINENT BANKER for August, 1982 vides coverage on installment loans in the You’re w eary of the prom ises-never-kept For your employees syndrom e. The here-today-gone-tom orrow event of the customer’s death or disability. ■"Tomorrow’s Income Plan (TIP), a taxaccount representative shuffle. The disappear ■"Total Obligation Protection (TOP) provides deferred income program for cash accumula ing product act. In short, you haven’t been u n lim ited coverage w ith a flexible life tion with guaranteed monthly payments upon satisfied with the results — and that’s fine insurance program designed to protect the with us. Because it gives us the opportunity to customer’s family and business from loan re retirement; payable under payroll deduction plan. show you what Acceleration can do. sponsibilities. ■"Personal Insurance Protection offers com Here’s a brief rundown on our product port *CreditGuard provides coverage for the out p etitiv e prem ium ra te s on autom obile, folio: standing balance of a VISA or MasterCard homeowner, condominium and tenants insur account in the event of your customer’s death ance. For your bank_______________________ or disability. ■"Collateral Protection Management Pro *IRA Completion is an insurance plan that pro Acceleration’s service satisfies even the most discriminating bankers. Isn’t it time you found gram protects your institution against losses vides disability and death benefits to your IRA out why? resulting from uninsured collateral, plus a account holders, thus assuring them that their management system that organizes and sim Acceleration Life IRA will be completed if they become disabled plifies insurance administration. Insurance Company or die. 475 Metro Place North ■"Mortgage Life Insurance to pay off a cus Dublin, Ohio 43017 For your customers tomer’s home mortgage in the event of death Specialists in financial products ■"Credit life and disability insurance pro or disability. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis SOMEPEOPLEARE NEVERSATISFIED IF YOU’RE ONE OF THEM, GIVE ACCELERATION A CALL. th eir use. Keep in m ind that one of A m erica’s largest banks had its spokesm an sug gest that m aybe it should give up its bank charter and obtain a ch arter sim i lar to those held by A m erican Express or M errill Lynch. If we look at recen t decisions by financial-institution reg ulators, such as those controlling cre d it unions, we find th e re has been sub stantial rem oval of restrictions on cre d it-u n io n -re la te d activities. W h e th e r this is d esirab le d e p e n d s p artly on w hose foot th e shoe is being tried. N ot only federal regulators can be criticized. Actions by some state re g ulators are m ind-boggling. In N ew Jersey, w here dozens of S&Ls already are in violation of reserv e re q u ire m ents and nine out of 10 have suffered losses and continue to operate in the red, th ere is strong political pressure to p rev en t com m ercial banks from tak ing over troubled S&Ls. M any politi cians ap p aren tly p re fe r S&Ls to go th ro u g h liq u id a tio n ra th e r th a n be absorbed by banks. The p receding is m entioned to m ake th e major point th at we do have ad vanced technology in the public in terest, technology th at would make for so u n d e r, safer and m ore p rofitable tran sactio n s, y et we find th a t such technology is being held up at b oth the For faster service on BANK CREDIT INSURANCE CALL THESE SPECIALISTS Harold E. Ball • Carl W. Buttenschon John E. King • M ilton G. Scarbrough 214 / 559-1173 @) f e d e r a l a n d s ta te le v e ls b y w ellin ten d ed , b u t m isguided, individuals and agencies. Regulations im posed by bank reg ulators p rev en t full utilization of ex isting technology. Regulations for the m ost part im pede productivity rath er than encourage it. P u rists m ay hold th a t A m erican banks shouldn’t provide com m ercials on b a n k in g te rm in a ls such as th e G reek bank does. The answ er may be for the bank not to own the term inals b u t to lease them from an advertising agency. The agency th en would con trol d evelopm ent of the public service th e term inals provide. P e rh a p s th e m a jo r p ro b le m of m yopic regulators is th eir m ind-set in failing to recognize the fact that they lack the ability to regulate effectively in today’s dynam ic age of technology. W hat has h ap pened to banks and o th er financial interm ediaries is that te c h n o lo g ic a l d e v e lo p m e n ts h av e m ade m any — probably most — reg ulations obsolete and co u n terproduc tive. Nonfinancial interm ediaries, being un reg u lated for the m ost part, have m oved into th e vacuum. Banks and o th e r financial institutions will find them difficult to dislodge. • • R ou n d u p Christmas Club a Corporation. R enee B re tt and M ike M cN ab have b een given ad d ed resp o n sibilities at this Easton, Pa.-based firm. Ms. B rett now is product m anager/checks and outlook envelopes and continues h er responsi b ilitie s for a d v e rtisin g /p u b lic re la tions. M r. M cN ab has b e e n m ade pro d u ct m anager/system s, m em b ers’ envelopes and passbooks, as well as Pull Service Bank Productions, Inc. H e had been product m anager/checks and check envelopes. Bankers Card Corp. K. Kay Ulwelling has been nam ed p resid en t of this Kan sas City firm, w hich provides m arket- INDUSTRIAL LIFE INSURANCE COMPANY P.0. Box 220998, Dallas, Texas 75222 /TQ M rr^A Q A member company of R p d i i h l i r F in p n r ip l R p r v ir p « ; I n r ULWELLING 14 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis McNAB BRETT ing and financial services to financial institutions throughout the M idwest. Bankers Card Corp. is a subsidiary of E lectronic F u nds Transfer Systems, In c ., of w hich Ms. Ulwelling is a direc tor. EFTS plans an electronic netw ork deploying autom ated teller m achines and point-of-sale term inals in retail locations in the g reater Kansas City area u n d er the nam e “U n itel.” Ms. Ulwelling will be responsible for ser vice support of “U nitel. ” K anney M arketing S ervices. T his Bohemia (Long Island), N. Y.-based firm has announced appointm ent of th ree sales personnel. A lbert J. Parten h eim er has b een nam ed vice p resi d en t, responsible for national sales m anagem ent. Before joining Kanney, he spent 10 years w ith W. M. D alton & Associates, N ew ton, Pa., w here he was senior vice p resid en t in charge of sales. Philip C. G ordon and R obert D ahlhausen also have joined K anney’s sales force, both com ing from W. M. Dalton. Infoware, Ltd. This recently form ed, N ashville-based firm is said by its orga nizers to be th e first of its kind, exclu sively devoted to researching, screen ing and m arketing high-quality desk top com puter software to financial in stitutions. It was founded by Allen H ardin, form erly vice p resid en t/E F T division, F in an cial In stitu tio n S er vices, Inc. (FISI), also in Nashville, and W ayne N y stro m , fo rm e r F IS I d ire c to r/p ro d u c t d ev elo p m en t. T he firm also announced that it has reached an agreem ent w ith A urora Systems, Madison, W is., to becom e A urora’s ex clusive m arketing agent for its M oney C en ter Accounting Program . Associates Commercial Corp. Allen A. Preble has been elected vice p resi den t of this Chicago-based company. H e will serve as m anager/m idw estern region for the firm ’s business loans di vision. Mr. P reble has m ore than 25 years of com m ercial-finance experi ence, serving most recently as Chicago region m anager, Security Pacific Busi ness C redit, Inc. Texas H eller W estern. R ichard L. Philson has b een appointed senior vice president of Texas H eller W estern, a full-service com m ercial-finance sub sidiary of W alter E. H eller W estern, Inc. Mr. Philson has responsibility for overall supervision of th e Texas H eller W estern op eratin g units, w hich in c lu d e h e a d q u a rte rs in D allas and offices in H ouston and San Antonio. Mr. Philson has held key posts in the c o m m ercial-fin an ce in d u s try since 1958. MID-CONTINENT BANKER for August, 1982 Promoting momentum in Correspondent Banking. M ercantile B ank is proud to announce the prom otion of Rob Ivey to Senior Vice P resident of C orrespondent Banking. In recognition of Mr. Iveys accom plishm ents at M ercantile, we feel we re not only gaining a valuable departm ent head,but also our correspondent b anks are gaining m om entum , https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis M ercantile National Bank at Dallas Dallas, Texas 75265 Member M ercantile Texas Corporation Member FDIC St. Joseph M arket Day Set fo r September 8 Fed Answers Reg Questions John W. Roshrugh, examiner in the St. Louis Fed’s consumer and community affairs depart ment, answers common questions about federal regulations affecting most banks. Information given here reflects Mr. Roshrugh s opinions, not necessarily those of the S t. Louis Fed or the Board of Governors. LIG IBILITY req u irem en ts for N O W accounts w ere announced on August 14, 1981, and becam e effective S eptem ber 16, 1981. The Federal R eserve continues to receive num erous questions con cerning th e eligibility of various nonprofit and governm ent organiza tions to m aintain such accounts. Regulation Q, Section 217.157, clarifies th e rules concerning the class of depositors eligible to m aintain N O W accounts at m em ber banks. A ttention should be d irected to subsections (c) and (d) of this interp retatio n for inform ation on th e req u irem en ts for nonprofit organizations and g overnm ent units, respectively, and are p rin ted here. (c) N onprofit O rganizations. (1) U nder th e Act, a nonprofit organization that is operated p ri marily for religious, philanthropic, charitable, educational or other similar purposes may m aintain a N O W account. The Board regards the following kinds of organizations as eligible for N O W accounts u n d er this standard if they are not operated for profit: (i) organizations described in section 501(c)(3) through (13), and (19) of th e In tern al R evenue C ode (26 U .S.C . (I.R .C . 1954) Section 501(3) through (13) and (19)); and (ii) hom eow ners and condom inium ow ners’ associations d e scribed in section 528 of th e In tern al R evenue C ode (26 U .S.C . (I.R .C . 1954) Section 528), including housing cooperative asso ciations th at perform sim ilar functions. (2) All organizations that are o p erated for profit are not eligible to m aintain NOW accounts at m em b er banks. (3) The following types of organizations described in the cited provisions of th e In tern al R evenue C ode are am ong those not eligible to m aintain N O W accounts: (i) credit unions and o th er m utual depository institutions d e scribed in Section 501(c)(14); (ii) m utual insurance com panies d escribed in Section 501(c)(15); (iii) crop financing organizations described in Section 501(c)(16); (iv) an organization created to function as part of a qualified group legal services plan d escribed in Section 501(c)(20); (v) farm ers’ cooperatives d escrib ed in Section 521; or (vi) political organizations d escribed in Section 527. (d) G overnm ental Units. U n d er th e Act, governm ental units general ly may not m aintain N O W accounts. The Board believes that some governm ental units are o p erated prim arily for philanthropic, educa tional or charitable purposes, and that such entities should be re garded as eligible to m aintain N O W accounts. F or exam ple, a gov ernm ental unit, regardless of form of organization, may m aintain a N O W account if th e funds are in th e nam e of or are used solely for schools, universities or colleges, libraries, hospitals or o ther educa tional or m edical facilities. It should be noted th at o th er supervisory agencies have adopted the same rules for th e ir institutions. E 16 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ST. JO S E P H , MO. — T he 26th annual m arket day, co-sponsored by F irst Stock Yards and First National banks, will be held on S eptem ber 8. Registration will begin in the lobby of F irst Stock Yards Bank at 9 a.m. M orning activities will include a tour of th e M issouri Valley W alnut Co. Luncheon at the H oof & H orn Steak H ouse will include a rep o rt on the cu r re n t day’s livestock m arket. The afternoon program will begin at 2 p.m . at th e St. Joseph C ountry Club. P rincipal sp eak er will be F ran k S. H o u g h , p ro fe sso r of eco n o m ics at G raceland College, Lam oni, la. His to p ic w ill be “ S elf W o rth vs. N et W orth. ” A panel discussion on various ag ricu ltu ral com m odities and price tre n d s will follow D r. H o u g h ’s re marks. A social hour and steak d in n er will conclude the event. Fellowships Established To H onor Cummings Tw o fe llo w sh ip s to th e S to n ie r G raduate School of Banking have been established to honor th e late John J. C um m ings Jr., Rhode Island banker who gave m ore than 20 years of service to the ABA. The fellowships w ere established by the ABA’s board of directors and the board of regents of Stonier. T he fellow ships will be aw arded each year, beginning in 1983, to two professional staff m em bers in the ex e c u tiv e or le g isla tiv e b ra n c h e s of federal or state governm ent. Those selected will atten d a two-week resi den t session of Stonier at R utgers U ni versity, New Brunswick, N. J. Mr. C um m ings served as chairm an of S to n ie r’s b o ard of re g e n ts from 1980-82. He also served as vice chair man of the ABA’s governm ent rela tions co u n cil and ch airm an of th e corporate planning executive com m it tee. Profit Im provem ent in B anking is a new brochure available at no cost from A rthur A ndersen & Co., which says it d etails a c o m p re h e n siv e p ro fit-im provem ent program to increase bank re v e n u e an d re d u c e costs. W rite : Com m unications D istribution, A rthur A ndersen & Co., 69 W. W ashington St., Chicago, IL 60602. MID-CONTINENT BANKER for August, 1982 Among every 100 auto loan borrowers, there are nine insurance delinquents. Yours? Statistical fact. Hidden in your loan portfolio, nine ordinary people — through simple negligence or whatever other reason — can rip your installment loan profitability to ribbons. Vendors Insurance Agency, VIA, was established to protect lenders against losses sustained if uninsured “ rolling collateral’’ assets are severely damaged or destroyed. Even more important, VIA’s “ watchdog” computer service keeps a continuous eye on your auto loan portfolio to make sure “ nine percenters” never hide in your files again. Weekly computer reviews (delivered to your installment loan department) keep you constantly aware of insurance delinquencies. Uninsured borrowers are notified and warned. If no appropriate action is taken, a Certificate of SingleInterest insurance is issued to the lender, costs chargeable to the borrower. It’s as simple as that. If the idea of keeping installment loan profit at optimum is important to you, call or write us. We’ll give you details immediately. VENDORS INSURANCE AGENCY Home Office: 55 E. Monroe Street Chicago, Illinois 60603 312/346-6400 VENDORS INSURANCE AGENCY IS A MEMBER COMPANY OF INTERSTATE NATIONAL CORPORATION ONE OF THE FIREMAN’S FUND INSURANCE COMPANIES MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 17 BANKING WORLD T rust, Baltim ore, was elected p re si dent, R obert M orris Associates, in the association’s annual election August 6. H e succeeds John D. M angels, p resi dent, R ainier National, Seattle. Jack R. C rigger, executive vice p resident, A m e ric a n N a tio n a l, C h a tta n o o g a , T e n n ., was elected first vice president. E le c te d second vice p re s id e n t was G lenhall E. Taylor Jr., executive vice p re s id e n t, W ells F argo Bank, San Francisco. W illiam H. D ougherty, vice ch air m an, S o u th east Banking C orp. and S o u th e a s t B ank, M iam i, has b e e n elected chairm an, Bank A dm inistra tion Institute. H e succeeds G eorge D. N o rto n , e x e c u tiv e vice p r e s id e n t/ cashier, P h ilad elp h ia N ational. T he new BAI chairm an-elect is R ayburn S. D ezem ber, chairm an/C E O , A m erican National, Bakersfield, Calif. E lected secretary /treasurer was John S. Poelker, p resid ent/chief financial officer, C itizens & S outhern G eorgia C orp., A tlanta. T h ese th re e officers, plus R o n ald G. B u rk e, BAI p re s id e n t, m ake up th e executive com m ittee of th e in stitu te’s board. D ouglas W . D od ge, executive vice p resid en t, M ercantile-Safe D eposit & W hen quick response is vital to your correspondent banking needs, Tnmkrust IÇt First of Fort W orth The First National Bank of Fort Worth »One Burnett Plaza, Fort Worth, Texas 76102 Phone (817) 390-6331 or Texas WATS Line (800) 772-5931 Member F.D.I.C. & F'irst United Bancorporation 18 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Janies F. Lordan, senior vice p resi dent, State S treet Bank, Boston, has b e e n e le c te d p r e s id e n t, N a tio n a l A utom ated C learinghouse Association (NACHA). In that post, he heads the e x e c u tiv e c o m m itte e a n d b o a rd . W. R obert M oore, senior vice p resi dent, Chem ical Bank, N ew York City, was NACHA president, 1981-82, and continues on the association’s execu tive com m ittee. O th er new ly elected NACHA officers are: vice p resid en t, J. R obert B rubaker, senior vice p resi d e n t, E q u ib a n k , P itts b u r g h , an d secretary/treasurer, G arry L. Singer, associate director for the NACHA sup p ort staff at the ABA s head q u arters in W ashington, D. C. M essrs. B rubaker and Singer also are on NACHA s ex ecutive com m ittee. James Rubenstein has joined the Bank M ark etin g A ssociation, Chicago, as director of editorial services. M ost re cently, he was m anaging editor, Bank L etter new sletter, a publication of In stitutional Investor, Inc. Before that, Mr. R ubenstein was M idw est B ureau chief, A m erican B anker. In his new post, he also is editor, B ank M arket ing, the BMA’s m onthly periodical. In ad d itio n , M r. R u b en stein will ed it o th er association new sletters and p u b lications in the com m unications divi sion, rep o rtin g to C harles B artling, vice president. Larry D. Wright, form erly vice president/m anager, lending division, F irst G alesburg (111.) National, has joined F irs t C ity B ank-A lm eda G en o a in H ouston as president. The bank is a subsidiary of F irst C ity Bancorp, of Texas, h ead q u artered in H ouston. Mr. W right had been w ith th e G alesburg bank since 1972 and, before that, spent six years w ith Irw in U nion Bank, Co lum bus, Ind. MID-CONTINENT BANKER for August, 1982 A full set of high-impact, top-quality prem to choose from. A selection to spark your imagi nation and fire up the sales you need for a really successful promotion. Look at “Christmas Cub” leading the way. He’s the focal point of our fabulous Christmas Club program. Build your club around him for “the beginning of fond memories.” Choose from scores of other appealing premiums, too, for year-round use, all contained (but bursting to be your star attraction) in this brand new Premium Collection. © 1982 Christmas Club a Corporation, Easton, PA https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis istmas Club representative, for your copy today. Better yet, call Renée rett, (800) 523-9334 New York, New Jersey, Maryland, Delaware; (800) 523-9440 all other states except Pennsylvania; (215) 258-6101 Penn sylvania residents. P.O. Box 20, Easton, PA 18042 a corporation The Original ™A service mark and trademark of Christmas Club a Corporation, Easton, PA https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Whatever your size. Whatever your needs, We have faced and solved your problem before. Many times. Let us put our experience to work for you. to Bank Building Corporation ' 130 H AM PTO N AVENUE ST LOUIS. MISSOURI 63*39 (314) 647-3800 ’C i 41, 1 mm IT i M m i Î . ik High-Priority Problems That Face Farmers In Planning Estates By Neil E. HarT I t’s im portant to w atch out for state gift IN C E en actm en t of th e Econom ic Recovery Tax Act of 1981, slip tax (in th e dozen states that have a state ping farm -com m odity p rices, risinggift tax) and possible recapture of in vestm en t tax credit. But at least the costs and softening land values have federal-gift-tax w orry has b een elim i b een at c e n te r stage. Less pressing nated. problem s have b een shun ted aside. • The new 100% federal-estate-tax But tim e continues to tick away. m arital deduction makes it possible to And some may pay a high price if death zero out federal-estate-tax liability if all should occur before estate plans have property is left to th e surviving spouse been reshaped to fit th e new rules. at death. T h at’s tru e even if the p ro p For fa rm couples renting erty is in jo in t tenancy or tenancy by th e entirety. their land to a tenant, e lig ib il B ut th e big p ro b lem still is th e ity fo r installment payment of f e d e r a l- e s ta te - ta x lia b ility at th e federal estate ta x is a m atter of second d eath unless there has been some planning before the fir s t death. the type o f lease in effect at F o r those w ith com bined estates of death. And increasingly, it's roughly $500,000 or m ore, it’s general the sec o n d death th a t's the ly a good idea to: (1) move to equal sized estates with tenancy in com m on more im portant. That's when and (2) leave at least part of the estate the big tax bite usually comes. in tru st w ith a life estate to the surviv ing spouse. At a m inim um , it’s usually In the paragraphs following, we look advantageous to do that at least to the at fo u r h ig h -p rio rity a re a s. T h ese e x te n t of th e unified c re d it in th e should receive planning attention as e s ta te o f th e firs t to d ie . T h a t’s soon as possible. $225,000 for deaths in 1982, rising to R eview p r o p e rty o w n ersh ip . F o r $600,000 for deaths after 1986. y ears, th e w ay p ro p e rty has b e e n F or those w ith larger estates, it pays ow ned — b etw een husband and wife to take an even closer look at how — has been a m atter of m ajor concern m uch pro p erty should be left to the in farm estate planning. The big p ro b surviving spouse o u trig h t and how lem has been jo in t tenancy (in some m uch in trust. states, it’s tenancy by th e entirety) R eview the will. T here are several w ith its right of survivorship. At the reasons wills draw n or last revised b e death of th e first co-ow ner, th e survi fore th e 1981 tax act should be re vor receives com plete ow nership of view ed now. th e property. • M any w ills lim it th e fe d e ra lT h e 1981 tax act m a d e s e v e ra l estate-tax m arital deduction — to the changes in this area: g re a te r of $250,000 or 50% of th e • F irs t, th e n ew fe d e ra l-g ift-ta x f e d e r a l- e s ta te - ta x a d ju s te d g ro ss rules make it possible to break up old estate. A few wills drafted before 1976 joint tenancies or tenancies by th e e n are even m ore restrictive — lim iting tirety w ith no federal-gift-tax lia b ility. th e m arital deduction to 50% of the adjusted gross estate. * Neil E . Harl is Charles F . Curtiss distin If it’s an advantage to have a larger guished professor in agriculture and pro m arital deduction, the will should be fessor of economics, Iowa State University, Ames. He also is a member o f the Iowa B ar. revised accordingly. Language calling S MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis for the “maximum m arital deduction m eans maximum u n d er the old law and not maximum u n d er the new law unless the will is revised or state law is am ended to change the result. Some may w ant to stru ctu re their wills to make it easy for the estate re p resen tativ e to elect Q -TIP — that s “qualified term in ab le-in terest p ro p e r ty. ” Basically, it’s a way to qualify a life M any wills lim it the fe d e rale sta te -ta x m a rita l deduction — to the g reater o f $ 2 5 0 ,0 0 0 or 5 0 % o f the federal-estatetax adjusted gross estate. A few wills d ra fte d before 1976 are even more restrictive — lim iting the m arital deduction to 5 0 % o f the adjusted gross estate. estate left to the surviving spouse for th e federal-estate-tax m arital d ed u c tion. It m eans the pro p erty ow ner can control the ultim ate disposition of the property. Traditionally, the surviving spouse has b een free to dispose of p ro p e rty qualifying for th e federalestate-tax m arital deduction. A good reason for using a tru st for Q -TIP arrangem ents: If p roperty is left in a legal life estate (not in trust), it appears the property isn’t eligible for special-use valuation at th e second death. T h e re ’s an am endm ent in the Technical C orrections Act to deal w ith th e problem , b u t it hasn’t passed yet. • M any wills use the term “adjusted gross estate’’ in specifying how m uch p ro perty is left to th e surviving spouse. T hat term was repealed in 1981 as part o f th e m a rita l-d e d u c tio n rev isio n . T herefore, wills should be revised to define the term (if it continues to be used in the will) unless th e state legis lature acts to provide a definition, as 21 Iowa has done. I n s ta lh n e n t p a y m e n t o f fe d e r a l estate tax. F or farm couples renting th eir land to a tenant, eligibility for installm ent paym ent of federal estate tax is a m atter of th e type of lease in effect at death. And increasingly, it’s th e second death th a t’s the m ore im portant. T hat’s w hen the big tax bite usually comes. To b e e lig ib le fo r th e 1 5 -y e a r stretch-out in paym ent — w ith 4% in te re st on the first $345,800 of federal estate tax less the unified credit — it’s Private Annuity Can Help Fanners Reduce Their Estate Taxes FA R M ER ’S biggest asset usually is his land, b u t the value of this asset can dw indle alarm ingly on his d eath because of estate taxes. In th e accom panying article, Neil E. H arl, C harles F. C urtiss distin guished professor in agriculture and professor of economics, Iowa State University, Ames, discusses four high-priority areas in estate planning that should be addressed by farm ers and th e ir spouses. In addition to suggestions m ade by Professor Harl, th ere is another device available to farm families who w ant to w hittle down th eir estate taxes. This device is called th e private annuity. A private annuity is an arran g em en t w hereby an individual sells property (farmland) to an o th er individual (usually a younger relative) in retu rn for periodic paym ents for th e rest of the seller’s life. The big estate-planning benefit of th e private annuity — according to the ag extension service of Texas A&M College and a n ew sletter published by W illiam S. F ry & Co., a D ayton, O ., CPA firm — is that as soon as the seller transfers p ro p erty for the annuity, he has given up all in terest in the property and, therefore, has elim inated estate taxes on his p ro p e rty . These annuities are called p riv ate” because the b uyer m ust not be in th e business of selling annuity contracts. F o r instance, an insurance com pany cannot be involved. The biggest problem for farm ers who use this estate-planning tool is that the paym ents for farm and ranch land m ust reflect the cu rren t fair-m arket value of th e land, age of th e seller and annuity-table interest rates. F or exam ple, for a seller who is about 60, annual paym ents need to be about 10% of th e p ro p erty value p e r year. Recause farm land often doesn t gen erate th at m uch n et incom e after taxes for th e p u rch aser to pay th e seller, m any people give up the idea of using private annuities. H ow ever, this device can work if only part of a farm is sold on a private-annuity basis. This is tru e particularly if the buy er is th e ten an t on o th er land ow ned by the seller. Incom e from the oth er land can be used to pay th e seller, and it’s possible to adjust rental rates from the o th er land so th e b u y er has ad equate funds to pay the seller. Any farm er considering a private annuity should consider, of course, its pros and cons: 1. If the seller lives beyond his life expectancy, total paym ents may be m ore than th e p ro p e rty ’s actual value. 2. No lien can be retain ed by the seller to guarantee periodic pay m ents. O therw ise, th e land w ould not be excluded from th e seller’s gross estate for estate-tax purposes. 3. If the b u y er should die before th e seller, the b u y er’s estate m ust continue to m ake the periodic paym ents. 4. If th e b uyer holds th e p ro p erty u ntil th e ow ner’s death, the b u y er’s incom e-tax basis in th e p ro p erty will be th e total annuity paym ents made. 5. F or th e seller, each annuity paym ent is part retu rn of basis, part capital gain and part ordinary incom e. T hese th ree categories should be com puted before a contract is m ade to see w hat incom e-tax effects would be for both b u y er and seller. As can be surm ised from th e above, nearly every private annuity is unique, and farm ers thinking of using this device should consult an attorney in setting one up. A 22 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis necessary to have an “in te re st in a closely held b u sin ess.” A cash re n t lease, even to a family m em b er as farm tenant, fails the test. It takes a cropshare or livestock-share lease coupled w ith substantial involvem ent in deci sion m aking u n d er the lease. Recent rulings indicate the involvem ent can be by the landow ner — or by an agent or em ployee of the landow ner. In one ruling, activities of a bank as agent for the landow ner w ere sufficient for eligi bility. That suggests the involvem ent could be by a farm m anager as agent of the landow ner. N ote that the determ ination of w hat is a closely held business is m ade in the instant before death — not five of the last eight years before death, for exam ple. And th e re ’s no re q u irem en t that the “business” be m aintained for a spe cified period after death — b u t disposi tion or w ithdraw als after death of half or m ore term inate installm ent re p o rt ing. The in terest in th e closely held busi ness m ust exceed 35% of the adjusted gross estate. T hat’s an o th er re q u ire m ent to keep in m ind in doing p re death planning. Special-use valuation o f land. Rules for special-use valuation of land for federal-estate-tax purposes pose dif fe re n t b u t e q u a lly im p o rta n t p re death-planning opportunities. Again, it’s usually the second death th a t’s the most im portant. T he m arital d ed u c tion and unified credit often will take care of the federal-estate-tax problem at the first death. In m ore than half th e cases, the wife is the second to die. Conditions of eli gibility for special-use valuation at the w ife’s d e a th , th e re fo re , sh o u ld be view ed as at least as im portant as at the husband s death. U nfortunately, m uch of the planning focuses only on the husband’s estate-planning problem s. H ere are the m ajor pre-d eath p ro b lem areas: • The “qualified-use” test requires that the d eced en t or a m em b er of the d eced en t’s family have an equity in terest in the farm operation. The test m ust be m et (1) at the tim e of death, (2) five or m ore of the last eight years b e fore death and (3) during th e recapture period after death (except for a twoyear grace period im m ediately after death). That m eans cash-rent leases to a family m em b er as ten an t are accept able in th e p re-d ea th p e rio d . T he ten an t has th e necessary eq u ity in terest in that case. T h e re ’s a different rule after death and cash-rent leases are not p erm itted during th e recapture p e rio d ex cep t d u rin g th e tw o-year grace period. (C ontinued on page 38) MID-CONTINENT BANKER for August, 1982 The long-term specialists in farm credit It takes a concerted effort to provide financing for American agriculture today. Farming is now agri-business, with a variety of credit needs. O ne of them is long-term financing.. .where the Land Bank has con centrated its efforts for more than 65 years. Long-term farm loans are our only business.. .loans to purchase land, make land improvements, construct farm hom es and new facilities... almost any long-range need. The Land Bank understands these needs because our owners and directors are farmers themselves. They help to plan and provide credit at the local level with more than 1200 Federal Land Bank Association offices across the country. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis But the farm credit picture includes more than long-term financing. And the people at the Land Bank are proud to work alongside others in the financial community who also serve the American farmer. We appreciate your cooperation in providing the capital to keep our agriculture strong. L7VNDBÄNK T he Land B ank The Federal Land Banks of: Louisville, KY 201 West Main 4 0 2 0 2 St. Louis, MO 1415 Olive 63103 Austin, TX 5 9 3 0 Middle Fiskville Rd. 787 5 2 Wichita, KS 151 North Main 6 7 2 0 2 23 Financial Futures: A Tool for Ag Banks? G R IC U LTU R A L RANKS trad i tionally have enjoyed a high d e gree oi insulation from m ovem ents in national in terest rates because of th eir localized deposit stru ctu re and stable operating enviro n m en t that have ch ar acterized th e en tire banking industry since the 1930s. H ow ever, says an arti cle in th e May issue of the Econom ic Review of th e Kansas C ity F ed , ag banks now face new challenges that transcend th e increased risk all banks are encountering in today’s m ore vola tile interest rate-environm ent. If a decision is made to use financial futures, an appraisal must be made o f the bank's c a p a b ility to implement and manage their use. T he article was w ritte n by M ark D r a b e n s to tt a n d A n n e O M a ra M cD onley of th e KC F e d ’s econom ic research staff. T hey p oint out th at rural financial m ark ets have b e e n tra n s form ed in recen t years by a com bina tion of two factors: First, deregulation of th e banking industry through th e D epository In stitutions D eregulation and M onetary C ontrol Act of 1980 has placed rural ag banks in m ore direct com petition for funds w ith urban banks and depository institutions. Second, rural savers have gained ac cess to a w ider assortm ent of savings in s tru m e n ts sin ce th e la te 1970s. Thus, ru ral co m m u n ity banks have b een u n d e r increasing p ressu re to re place th e ir n o n -in terest-b earin g d e m and deposits w ith higher-yielding d e p o s it a c c o u n ts, such as m o n ey m a rk e t c e rtific ate s. C o n se q u e n tly , these banks no longer hold a large pool of dem and deposits w ith w hich to insu late them selves against adverse m ove m ents in national in te re st rates. Ag banks, therefore, faced w ith increased com petition and integration of rural financial m arkets, are being affected significantly by volatile in te re st rates. W hat do Mr. D rab en sto tt and Ms. M cD onley suggest in th e ir article? T hat the financial-futures m arket is an effective way of reducing in terest-rate 24 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis risk. As they say in the article, financial futures have th eir roots in agriculturalco m m o d ity -fu tu res m ark ets. T hese m arkets evolved because of the need to reduce the risk associated w ith u n certain prices for future purchase or sale of a particular com m odity. An ag p ro d u cer can reduce the risk of price flu c tu a tio n s by h e d g in g , w hich is establishm ent of a position in the com m odity-futures m arket opposite from th at held in the cash m arket. Similarly, say th e authors, a bank may reduce the risk of adverse in terest-rate fluctua tio n s by h e d g in g in th e financialfutures m arket. Seven p ercen t of ag banks surveyed recently by the KC F ed currently use financial futures, and another 15% said th ey w ere planning to use the finan cial-futures m arket and had taken sig nificant p reparatory steps. According to the survey, financial futures are the least-used tool for m an aging in terest-rate risk, even among u ser banks. Instead of using financial futures, th e m ajority of ag banks sur veyed have responded to increased in terest-rate volatility by em ploying tra ditional risk-reducing techniques. The two m ost com m on m ethods used are v a r i a b l e - i n te r e s t- r a te loans as an a lte rn a tiv e to fix ed -rate loans and shortening m aturities of assets to m ore n e a r ly m a tc h th a t o f lia b ilitie s . A nother m ethod frequently em ployed is use of m arket in terest rates other than th e national prim e as benchm arks for adjusting loan rates. The survey also provides inform a tion on two m ajor issues of concern to b a n k in g : a c c o u n tin g tr e a tm e n t of financial futures and th e ir regulation. C u rre n t accounting guidelines appear to discourage use of financial futures because of th e d isru p tiv e effect on banks’ financial statem ents, and reg ulatory guidelines are not clearly d e fined w ith regard to the distinction b e tw een hedging and speculating. The authors point out that how each issue is resolved will have a lasting im pact on th e d eg ree to w hich banks adopt financial futures as a risk-m an agem ent tool. Because cu rren t users of financial futures ten d to be large banks, say Mr. D r a b e n s to tt a n d M s. M c D o n le y , th e re ’s a question as to w h eth er they are a suitable tool for rural ag banks. Survey responses indicate that despite th eir size, sm aller ag banks may b e come regular users of financial futures. N early three-fourths of nonuser banks replied that a b e tte r u n d erstanding of uses of financial-futures m arkets would m otivate them to seriously consider th eir use. This, continues th e article, suggests that m any small banks consid e r financial futures a viable tool, but simply lack the expertise to becom e Because c u rre n t users o f fin a n cia l futures tend to be large banks, there's a question as to whether they are a suit able tool fo r rural ag banks. involved. The large n u m b er of small ru ral banks a tte n d in g inform ational sem inars on financial futures fu rth er dem onstrates an attitu d e of develop ing in terest by these banks. T he KC F ed article contains this advice in determ ining w h eth er finan cial futures will be a suitable tool in m an ag in g in te r e s t- r a te risk: F irst, c o m p a re u se o f fin a n c ia l fu tu r e s against the effectiveness of traditional risk-m anagem ent tools. If a decision is m ade to use futures, an appraisal m ust be m ade of the bank’s capability to im p lem ent and m anage th eir use. A bank may find that a financial-futures p ro gram will place excessive tim e d e m ands on p ersonnel or that expertise is lacking to carry it out effectively. In this case, a sm aller bank may find em ploym ent of outside consulting se r vices to be a m ore efficient m eans of directing a hedging program . H ow ev er, the article w arns, the bank’s board still m ust take final responsibility for a hedging program . A lth o u g h th e KC F e d ’s su rv e y showed that few banks are using the futures m arket now, the authors p re dict that w ith th e uncertain econom y, “A gricultural banks, w ith th eir back ground in com m odity fu tu res, may tu rn increasingly to financial futures as an a p p r o p r ia te r is k -m a n a g e m e n t tool.” • • MID-CONTINENT BANKER for August, 1982 When your agricultural customers need additional help. We make things grow. Now and then, when you need help with your better agricultural customers, it’s nice to be lined up with the Rrst National Bank of Kansas City We’ve been lending money to farmers and the agricultural com munity for years and years. As a matter of fact, we have two officers who do nothing else. Sometimes, as much as you want to help make things grow for your customers, you need help doing it. That’s when you should con tact us. We can help you help. Call and ask for any of our correspondent officers. FIRST NATIONAL CharterBank K A N S A S C ITY 10TH AND BALTIMORE □ BOX 38 □ KANSAS CITY, MO 64183 □ (816) 221-2800 □ MEMBER FDIC MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 25 Banking Group Formed To Buy Farm Loans From Affiliated Banks N ag-service com pany has been - form ed to purchase agricultural loans from affiliated banks. I t’s called MABSCO A gricultural Services, Inc. (MASI). It is a subsidiary of MABSCO Bankers Service, w hich is ow ned by 13 state bankers’ associations re p re se n t ing 6,700 banks. The 13 sponsoring states are: A rkan sas, Illinois, Kansas, M issouri, O kla hom a, C o lo ra d o , Iow a, M ich ig an , M in n e s o ta , N e b ra s k a , N o rth an d South D akota and W isconsin. M A B S C O B a n k e rs S e rv ic e was form ed early this year to provide an in teg ra te d financial-service program for custom ers of MABSCO s m em b er banks. The program is called Financial M anagem ent Account, and its com po nents include bank, m oney-m arketfund and b ro k erag e accounts, bank lin e s of c r e d it a n d o th e r b a n k spo n so red p ro d u cts. M A BSCO d e veloped it in conjunction w ith F idelity M anagem ent G roup, Boston. MASI, its new subsidiary, started operation in m id-July with a lim ited testing program , w hich is p rojected into this O ctober. Two or th re e banks in each of the 13 states are taking part in the program , w hich is designed to w ork out p ro c e d u re s and fin e-tu n e policies. D uring th e pilot program , says Jim C. Potter, MASI s executive vice president, who is h e ad q u artered in Des M oines, la., a m arketing and educational program is being started for all banks in the MABSCO region. Mr. P otter em phasizes that w hen MASI buys loan participations from affiliated banks, the loans will have to m eet a reasonable standard of creditw orthiness and in no way are to be construed as distress loans or subpar. As Mr. P otter puts it, “W e propose to fill a need for overline and liquidity pressure and do not intend to becom e A 26 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis a T is k -tra n sfe r’-o rie n te d source of credit. Lonnie G. Doan, a newly elected d irector of MASI and executive vice presid en t, O lney (111.) Trust, also told M i d - C o n t i n e n t B a n k e r that MASI will handle only “first-class loans” b e cause th e program w on’t work if bad loans are made. MASI, continues Mr. P otter, essen tially is a service com pany in that it will purchase loan participations on behalf of the ultim ate credit institutions in accordance w ith contracturai g u ide lines. T hese guidelines will include specific credit criteria w orked out by MAS I s directors. Mr. P o tter says that each bank p ar ticipating in MASI will purchase capi ta l n o te s ra n g in g from $ 3 ,0 0 0 to $12,500, depending on the size of a bank’s deposits. W hen M ASI’s services are available to all participating banks by the late fall of 1982, according to Mr. Doan, MASI will buy participations in short- to in term ed iate-term operating and e q u ip m e n t loans o rig in ated by affiliated banks. “W e expect the com pany loan vol um e to exceed $100 million w ithin one year of operation and to increase sub stantially th e re a fter,” Mr. Doan p re dicts. Mr. Doan, who also heads the Illi nois Bankers Association’s agricultural division, sums up M ASI’s purpose like this: “Officials feel that the ag-service com pany will provide a new source of m oney for the agricultural segm ent of th e econom y and are enthusiastic in bringing this new service to the bank ing com m unity. The purpose from the beginning of the task-force study has been to ensure a steady and reasonably p riced supply of m oney for agricul tu r e .” • • MASI Officers/Directors William Crawford, president, First National, Frederick, Okla., was elected chairman of MABSCO Agricultural Services, Inc. (MASI) at its organizational meeting in Des Moines, la., May 13. Other officers chosen are: vice chairman, Harry Argue, executive director, North Dakota Bankers Association, Bismarck; president, Edward L. Tubbs, chairman, Maquoketa (la.) State; executive vice p resid en t, Jim C. P o tter, Des Moines, and secretary/treasurer, Leslie W. P eterson, president, Farmers State, Trimont, Minn. In addition to Messrs. Crawford, Argue, Tubbs and Peterson, the fol lowing w ere elected to MASI’s board: Waldo F. Mottaz, chairman/ president, State Bank, Hallsville, Mo.; Lonnie Farm er, chairman/ president, First State, Davidson, Okla.; Lonnie G. Doan, executive vice president, Olney (111.) Trust; Marlin D. Jackson, chairman/president, Security Bank, Paragould, Ark.; Greg LeGare, Bank of Osseo, Wis.; Bill Cook Jr., president, Be atrice (Neb.) National; A. Edwin Baur, senior vice president, First National, Kalamazoo, Mich., and Neil Milner, executive vice presi dent, Iowa Bankers Association, Des Moines. MID-CONTINENT BANKER for August, 1982 The tool to fix the future for tomorrow’s family farm The new seventh edition of Farm Estate and Business Planning answers all your tax and estate planning questions.. .and more! After the passage of the Economic Recovery Tax Act, no taxpayer was left unaffected. National agricultural law authority Neil E. Harl, was instrumental in rewriting many of the new laws affecting agriculture — from gift tax provisions to special use valuation of land. This seventh edition of Farm Estate and Business Planning contains a more thorough and detailed analysis of estate taxes and business for farms and ranches than ever before. All wills and documents will need to be reviewed this year to obtain maximum tax savings. Act now. We’re sure that you will be pleased with this new seventh edition. 400 pages, 5 Vi" x 8", softcover. Return the order form below with your remittance to: Agri Business Publications, 5520-G Touhy Avenue, Skokie, IL 60077. E state and T ax P la n n in g is a vital to o l o f th e total farm plan to d a y , b ecau se it insures th at there w ill be a fa m ily farm to m o rro w ! ORDER FORM for “ Farm Estate and Business Planning” by Neil E. Harl. 1-5 copies, each ......................................................$12.95 6-49copies, each ................................................... $11.75 50-99copies, each ................................................. $10.50 First lOOcopies......................................................$995.00 Larger quantity prices available upon request. PLEASE SHIP □ Enclosed is my check payable to Agri Business Publications Inc. Ship books postage paid. □ Bill me for book(s) plus $3.00 each for postage and handling. F.O .B. Skokie, IL Illinois residents add 6% U.S. Funds only. copies of book to: Name Institution Address__ C ity ____ State ____ Zip Clip and mail to: Farm Estate and Business Planning, 5520-G Touhy Avenue, Skokie, IL 60077. For additional information, phone 312-676-4060. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis D ID C 's N e w Short-Term A ccount Fails to Please Bank Groups The ABA, in a special edition of its H E ABA and In d e p e n d e n t Bank ers Association of A m erica (IBAA) B ankers N ews W eekly, dated July 6, said of th e new account: “I t’s ab u n have b een on opposite sides of the fence on some banking issues. H ow ev dantly clear that th e D ID C is unw ill er, both groups disapprove of th e June ing to fulfill its responsibility in blatant 29th action taken by th e D epository contradiction of the deregulatory p h i Institutions D eregulation C om m ittee losophy of the Reagan A dm inistration. (DIDC). At th at tim e, a new sh o rt The ball now is clearly in C ongress’ term account was authorized, to take court to resolve these inequities before additional dam age is done to this na effect S ep tem b er 1. T he account, prop o sed by D ID C tio n ’s c o m m u n itie s an d th e banks Chairm an D onald Regan, Secretary of trying to serve them . In th e m eantim e, the Treasury, has th ese essential fea th e securities industry continues to be tures: th e w inner at the expense of local com • A m in im u m $20,000 daily b al m unities and bo rro w ers.” ance, w ith th e in terest rate tied to the The ABA stressed that it now would 91-day T-bill rate for thrifts and 25 few er basis points for com m ercial banks. H ow ever, th e rate is to be red u ced to 'Remove Shackles' — CSBS the passbook rate if th e average bal ance falls below th e re q u ire d m ini W A S H IN G T O N , D. C. — A mum. “non-event” is how the Conference • A m aturity range of from seven to of State Bank Supervisors (CSBS) d e s c rib e s th e n ew s h o rt-te rm 31 days. account created June 29 by the D e • N ew d eposits p e rm itte d at any pository Institutions Deregulation tim e, b u t m ust be held in th e account Com mittee (DIDC). The account is for the full m aturity period. described in the accompanying arti • No sweeps allowed into or out of cle. the account. In a statem ent issued July 6 by • No th ird -p a rty tra n sa c tio n s al CSBS’s president, Michael D. E d lowed. w ards, su p erv iso r of b anking in • A penalty m ust be levied for early W a sh in g to n sta te , said, “ F rom w ithdraw al of funds. points of view of commercial banks and the states, the new certificate of • No loans to depositors to m eet th e deposit created by the D ID C is a req uired balance. non-event. It falls far short of being • The account cannot be used as col co m p etitiv e w ith m o n ey -m ark et lateral for a loan. mutual funds, and it certainly will • The account is nonnegotiable. not slow significantly the outflow of F D IC C hairm an W illiam Isaac, a funds from most states into a few D ID C m em ber, argued against Sec money-market cen ters.” retary R egan’s proposal, saying it was Mr. Edwards said this dilemma in e ffe c tiv e , a n d o ffe re d h is ow n facing an across-the-board federal solution can be solved by selective alternative “m oney-m arket acco u n t.” solutions at the state level. He then H ow ever, he was outvoted four to one pointed to his own state and to South and so becam e th e only d issen ter on D akota, w h ich a lre a d y have the com m ittee. approached the D ID C with initia Mr. Isaac’s proposed “m oney-m ar tives tailored to th e ir respective ket account’’ was a dereg u lated , no states’ needs, initiatives, he added, m atu rity account, w hich p e rm itte d that would not do violence to the unlim ited w ithdraw als, b u t only th re e safety and soundness of their thrifts. tra n sa c tio n s m o n th ly . In itia lly , he O ther states, he added, are contem plating similar initiatives, and many w o u ld h a v e s e t th e m in im u m at more would take steps best suited to $20,000, w ith the m inim um balance to their citizens’ needs if they thought be gradually red u ced to zero by O cto they had a chance to get D ID C b er 1, 1983. H e said his account was approval. needed because “it has liquidity” and “States are doing their p art,” he added th at Secretary R egan’s account concluded, “and ask the D ID C to w ould be “ in effectiv e b e c a u se th e remove the shackles now keeping m inim um is too high; th e rate is not state initiatives from serving their high enough, and it w on’t be com peti citizens.” tive because it has no liq u id ity .” T 28 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis seek legislative rem edies because the “D ID C no longer counts.” T he IBAA m aintains the D ID C “has p u t the gun to com m ercial banks’ head and cocked it.’ “ T he C o m m itte e ’s b la ta n tly d is c rim in a to ry a c tio n a g a in st b an k s, ch am p io n ed by T reasu ry S ecretary Regan, is governm ent irresponsibility at its w o rst,” charges IBAA P resident R obert M cCormick, p resident/C E O , Stillw ater (Okla.) National. “Banks are expected to agree to com pete against S&Ls, which are given com m ercial banking pow ers, b u t not the regula tory obligations banks m ust shoulder. In exchange, we are in structed to take on faith the D ID C ’s future adoption of a nonexistent instru m en t we re told w ill e n a b le us to co m p e te against m o n e y -m a rk e t m u tu a l fu n d s. T he D ID C hasn’t earned that faith. “Com m ercial banks are being m ade to pay for mistakes th e governm ent m ade in locking S&Ls into fixed-rate m ortgages and m ade to e n d u re the g o v ern m en t’s regulatory perm issive n e ss w ith m o n e y -m a rk e t m u tu a l funds. “Any claim the A dm inistration may have had to prom oting orderly d ereg ulation of the financial industry now has b e e n p ro v e d f r a u d u le n t,” th e IBAA h ead ob serv es. “ Politics has gained the u p p er hand over deregula tion. And it’s bad politics at that. ” • • 'H u rry U p' Bank Sign O rder Completed in Record Time “D ear Federal Sign. W e need 375 new signs in 30 days. And we need them installed at 50 locations. And we need old signs rem o v ed .” T hat was the gist of an o rder given to th e sign m anufacturer by In te rF irst C o r p ., D a lla s -b a s e d H C in m id M arch. The H C had ju st changed its nam e. To get the job done on tim e, F ederal Sign utilized 73 vehicles to accomplish both dism antling of old signs and in stallation of new signs. T hree of the firm ’s m ajor production facilities w ere pressed into service to m eet tim e re strictions. T he new signs w ere up by m idApril! U S Bankof Nashville Our examiners. At your service. U S Bank of Nashville offers a complete range of independent examinations, consultation on systems and procedures, and in vestigations of irregularities. Because we are bankers our selves, and because banks are the only businesses we examine, we are able to maintain rigorous, professional standards while allowing you to control the cost. Our examiners have been certified by the American Bankers Association Preferred Group Bonding Plan. That can make it easier for a bank to get insurance and may even mean lower premiums. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Ideas to Strengthen Farm Economy Submitted to Ag Dept, by ABA LIST of recom m endations and The ABA’s recom m endations are as policy co n sid eratio n s th a t th e follows: ABA believes can help im prove and • The ABA supports th e A dm inis strength en th e farm econom y and c e r tratio n ’s basic philosophy and the idea tain F arm ers H om e A d m inistration of a red u ced b u d g et for the Fm HA. (FmHA) program s has b een subm itted P ro g ram s th a t d u p lic a te coverages to A griculture Secretary John R. Block should be elim inated. by the ABA. • I n te r e s t rates on F m H A loans M eeting w ith Secretary Block re should not be subsidized because sub cently w ere M ichael E. Fitch, vice sidization causes a drain on th e overall p re s id e n t, W ells F arg o B ank, San federal budget. Rates on Fm H A direct Francisco, and Alan R. T ubbs, p resi loans should be based at the cost of dent, F irst C entral State, D eW itt, la., m o n ey to th e U. S. T re a su ry and executive-com m ittee m em bers of th e allow ed to float w ith th e T reasury’s ABA agricultural bankers division. cost of funds. G uaranteed loans should Secretary Block was told th at com be set at a m arket rate at which no mercial bankers are concerned about alternative direct-loan program would th eir farm custom ers and are eager to be available. work with the d ep artm en t and others • The ABA continues to support the from the private lending com m unity to transition from a disaster-loan program find solutions to farm ers’ problem s. to a se lf-su p p o rtin g cro p -in su ran ce A lthough bankers have not n oticed a program . The federal crop-insurance rash of bankruptcies or forced liquida program should be im p lem en ted ex tions, they are seeing an increase in peditiously and on a sound business the nu m b er of voluntary liquidations basis to cover all m ajor crops in every of farm operations. T he answ er is not agricultural county of th e U. S. m ore loans, b u t im proved incom e, th e • The Fm H A should not be a com bankers said. T hey also recom m ended p etito r of the private-lending sector, dev elo p m en t of foreign m arkets for b u t act as a len d er of last resort for U. S. farm com m odities. those who do not m eet credit stan A dards of the private-lending sector b u t who have a reasonable chance to suc ceed u n d er close supervision and ex ten d ed loan term s. • In addition, th e F m H A should work to elim inate abuses by farm ers taking advantage of certain subsidized loan p ro g ram s p rim a rily by e s ta b lishing stronger credit-elsew here stan dards. • The ABA encourages th e Fm H A to p ro v id e a g re a te r p ro p o rtio n of guaranteed loans. T hese loans w ould be utilized for borrow ers in a short term adverse econom ic situation, b u t who have a reasonable chance of suc cess. They can be serviced by privatecredit sources to help alleviate heavy d e m a n d s on u n d e r s ta f f e d c o u n ty Fm H A offices. • A graduation program to move farm operators who have succeeded in th e ir operations and are financially healthy from the Fm H A to th e priv ate lending sector is supported. This grad u a tio n p ro c e s s , h o w e v e r, n e e d s “stronger te e th ” to make certain those who can qualify for private credit are m oved to that sector. • To facilitate this graduation p ro cess, p riv ate len d ers are w illing to w ork w ith these farm operators on a guaranteed-loan basis during a transi tion period. • Realizing that m any Fm H A offices LENDERS WHO ARE CATTLE-FAX MEMBERS MEET THE CHALLENGE BY • knowing long-term projections. price trends and • keeping up with what’s going on in the cattle business. • knowing which stage of the cycle the industry is in. • knowing what opportunities their customers have and how to select the best ones. • having a source of accurate price information to value inventory. WE CAN HELP YOU MEET THE CHALLENGE AND MAKE SOUNDER LOANS. JOIN - 4 C H A lW ^ MTLE'MX The best cattle marketing information and analysis service available. FOR MORE INFORMATION ON HOW CATTLE-FAX CAN WORK FOR YOU CALL 1-800-525-6500, or write to P.O. Box 3947, Englewood, CO 80155 30 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 CORRESPONDENT BANKING. W H O HAS THE KEY TO PROFITABLY APPLYING YOUR IDLE FUNDS? At Fourth, correspondent banking is advanced, high-speed communications and computer technology. It’s rapid, smooth transactions when your needs are critical. It’s financial resources. For loan participations. For cash letter services. For quick check clear ances. It’s having the solid funding to ease your liquidity problems. It’s people. Specialists. Talented professionals who have insight through research on complex federal regulations. Who understand and recognize special needs. Who are committed to building personal, professional relationships. Correspondent banking. Intelligently applying, through research and technology, your investable funds to produce the maximum return for you. To us, it’s that simple. FOURTH NATIONAL THE FOURTH NATIONAL BANK OF TULSA 515 SOUTH BOULDER TULSA, OKLAHOMA 74103 (918) 587-9171 MEMBER FDIC MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis are understaffed, w hich delays loan processing for as m uch as six m onths, the ABA supports th e establishm ent of a c e rtifie d -len d e rs program for th e Fm H A along th e line of th e Small Business A dm inistration’s (SBA) certi fied com m ercial-lender program . The SBA p ro g ram takes into acco u n t a bank’s loan volum e, portfolio quality and perform ance w ith low loan losses. • T h e F m H A sh o u ld w ork w ith o th er lenders in a cooperative effort to simplify and standardize d o cum enta tion forms for the guaranteed-loan p ro gram. An ABA task force is w illing to w ork w ith th e Fm H A to brin g this about. • T he F m H A should stan d ard ize loan criteria u tilized by all districts and strive for uniform im plem entation of policies. • The Fm H A should be m ore flexi ble in establishing m ore realistic p ro cedures in respect to handling th e sale of assets, restru ctu ring d e b t and use of subordinations and assum ptions. • The banking com m unity realizes one way to stretch Fm H A resources is utilizatio n of su b o rd in atio n s d u rin g c ertain circum stances. T he agricul tural banking sector pledges its coop eration to assist by this m eans. • The banking com m unity as w ell as th e co o p erativ e farm c re d it system conduct credit and loan m anagem ent program s for th eir constituencies. The ABA encourages the Fm H A to pursue a strong training program for its p e r sonnel, w ith particular em phasis on coping w ith problem loans. • • Agricultural Finance From Lender's Viewpoint Is Subject of Book “ L en d in g to A g ricu ltu ra l E n te r p r is e s ,” by T hom as L. F rey and Robert H. Behrens. H ardcover, 475 pages, 1981, $30. Publisher: Bankers Publishing Co., 210 South St., Boston, MA 02111. A com prehensive handbook on agri cultural finance was published late last year. I t’s titled “L ending to Agricul tu ral E n te rp ris e s ,” and its authors, T h o m as L. F r e y a n d R o b e rt H. B ehrens, w rote it from the le n d e r’s point of view. They provide detailed discussions and pro ced u res on such subjects as: • How to analyze financial state m ents, calculate repaym ent capacity and stru cture loans to different types of farm, ranch and agribusiness opera tions. • W hat legal docum ents should be used in ag lending. • How to advise a borrow er on busi ness organization, insurance program s and retirem en t plans. T here are 36 pages of appendices w ith samples of everything from loan policies and legal docum ents to a b o r row ing base certificate. Tables and charts illustrate discussions of topics, w h ic h in c lu d e lo a n -a m o rtiz a tio n schedules, th e “lend-or-lease” deci sion and financing th e h edger in agri culture. A bibliography and index for locating topics quickly also are features of the book. Mr. F rey is professor of agricultural finance, U niversity of Illinois, and has B.S., M.S. and P h.D . degrees in agri cultural economics. H e also is a certi fied public accountant and accredited rural appraiser. Mr. B ehrens is vice president/senior loan officer, C om m ercial Bank, Cham paign, 111., and began his career in 1959 as a loan rep resen tativ e with the Production C red it Association. In 1965, Mr. B ehrens m oved to com m er cial banking, w here he has b een in charge of both com m ercial- and install m ent-loan operations and has w ritten policy and procedure manuals. H e also has w ritte n a book, “ C o m m e rc ia l Problem L oans,” published by Bank ers Publishing Co. Key Factors Revealed In Selecting a Bank M w (9/dhm4-x4- a ttc i The M onteleone is the newest old, full-service hotel, business m eeting and convention fa cility in the French Quarter: 600 Rooms • 16 M eeting Rooms • Two Restaurants • Three Bars • On Premises Parking • Our Roof-top Pool, Putting Green and Dukes’ Place (New O rleans’ internationally famous “ Dukes of D ixieland” perform 4 shows nightly) overlook the m ighty M ississippi River and French Quarter. „ For reservations call toll free 800/535-9595 32 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis F ree checking is the prim ary consid eration for selection of a financial in stitu tio n , acco rd in g to resu lts of a nationw ide survey by A. J. W ood R e search Corp. Availability of free checking was the single m ost frequently m entioned fac tor, considered im portant by five out of six respondents and rated as the single m ost im portant factor by m ore than one out of four respondents. In selecting an institution for a sav ings account, high in terest was by far th e key factor, considered im portant by about half the respondents. Low in terest rates on loans are the most im portant consideration in decid ing w here to borrow , w ith four out of five respondents rating them im por tant and m ore than two out of five con sidering them the single m ost im por tant factor. Each of these econom ic considera tions, how ever, pertains only to the individual service. O n an overall basis, friendly personnel, capable m anage m ent and safety/reliability are most im portant in selecting a financial in stitution. Physical location serves p ri marily as a screening device — if a bank is not adequately convenient, it will not even be considered. MID-CONTINENT BANKER for August, 1982 PICKOURPROS. Today’s fast-moving m arketplace offers m ore investm ent opportunities than ever before. But deciding which are the b e st for your bank can be a complicated business. If you’d like to uncomplicate your portfolio management, consider the services of Central Bank’s Investm ent Division. We’ll help you cap italize on opportunities as they happen, in a single area like m ar ket timing, or through com plete asset/liability m anagem ent. OF THE SOOTH Backed by a $2.4 billion corpo ration, our experienced m oney m anagers provide broad coverage of all m ajor m arkets, including municipal bonds, treasuries, govern ment agencies & all money m arket instruments. And in the Southeast, C entral is the bank with proven ability in structuring new municipal bond issues from sta rt to finish. So pick our pros. We’ll help plan your b e st investm ent strateg ies in a fast-moving m arketplace. And help you m ake fast, profitable decisions. CENTRAL BANKÉH In Alabama: 1-800-292-8534 ext. 3330 Alabama’s Largest Bank In the Southeast: 1-800-633-6573 ext. 3330 INVESTMENT SERVICES. ANOTHER GOOD REASON TO RANK AT CENTRAL. Member FDIC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Little Bank in Little Town in Big State Has Huge Effect on Its Community L T H O U G H people are used to hearing th at everything in the state of Texas is huge, th e com m unity of Booker, Tex., is an exception. It boasts only 1,200 persons and until re cently d id n ’t have a single grocery store. T he sam e m ight be said of F irst Bank, Booker’s only bank. W hen com pared with banks in H ouston and D al las, First Bank is p re tty small w ith $90 million in assets (although th a t’s not bad for a com m unity of 1,200!). But th ere is one thing about F irst Bank th at is huge — its service to Booker and the surrounding area. Glen E. Lem on, p resid en t/C E O at F irst Bank, has a philosophy that goes like this: The future of com m unity banking d epends on exactly how effec tive we are w ith our cu sto m ers.’ Mr. Lem on, who recently was elected vice presiden t of the Texas Bankers Asso ciation, is fully aw are th a t “th e r e ’s m ore business leaving our com m uni ties in th e form of m oney going to m oney-m arket m utual funds and o th er things than we can possibly conceive. I t’s up to us to exert th e effort to get it sto p p e d .” His m eth o d of accom plishing his goal for his bank is to d eterm in e w hat th e c u s to m e r of th e f u tu re re a lly wants. Mr. Lem on thinks this custom er will be looking for a bank that serves and cares for its com m unity. “H e ’s going to be looking for th e bank that utilizes every available opportunity to com pete in offering services th at will help his particular asset base grow. H e will want a bank th at expresses a sin cere and genuine in terest in him as a custom er personally.” A nd th at s th e kind of bank Mr. Lem on has in F irst Bank. The bank has $76 million in deposits, a loan portfolio of about $60 million — $15 million in installm ent loans and $12 million in agricultural loans. A nother $27 million is in the loan portfolio of th e bank’s agricultural credit corporation, which was set up to make it unnecessary for ag custom ers to be sent out of town to secure loan funds. Mr. L em on’s leadership in provid ing banking services for th e com m u n ity has re s u lte d in th e follow ing accom plishm ents: A 34 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • The bank led the way in renovat ing th e dow ntow n area of Booker. L oans at 5% sim p le in te re s t w ere offered, which brought th e bank a lot of publicity b ut few takers. According to Mr. Lem on, most m erchants had e n o u g h m o n e y in th e ir c h e c k in g accounts to rem odel th eir store fronts. “T hey ju st n eed ed a plan” to get it done, w hich the bank provided. • The bank sponsors an annual agri cultural tour to show off outstanding farm ing activities in the Booker area. • The bank is responsible for the tow n getting its only grocery store. It cam e to the attention of Mr. Lem on th at a young man w anted to retu rn to Booker to open a store, b u t he n eed ed financing. T he bank arranged for a Small Business A dm inistration loan. Now residents of Booker can grocery shop in town. • A nother SBA loan was arranged to e n a b le a bank cu sto m er to build a m eat-packing house, which has since becom e th e largest em ployer in Book er. • The bank's lobby has b een m ade into a social cen ter of sorts. E very day th e re is free coffee for custom ers and free popcorn every Friday. In addi tion, th e bank has facilities in its lobby for custom ers to check m arket prices and com m odity futures. • The bank supports an aggressive s tu d e n t-lo a n p rogram b ecau se Mr. Lem on feels such loans are good in vestm ents for the future of Booker and F irst Bank. The bank has m ade loans to G le n E. Lem o n , p re s./ C E O , First B a n k , B o oker, T e x ., told a b o u t h is b a n k 's co m m u n ity se rv ice a t rece n t a n n u a l co n ven tio n of A r k a n s a s B a n k e rs A s s o cia tio n . Mr. Lem on is v .p ., T e x a s B a n k ers A sso c ia tio n . alm ost 350 stu d en ts in th e past 15 years totaling about $750,000. All b ut four loans have been — or are being — repaid. • The bank doesn’t neglect its p e r sonnel. Two or th ree Saturday retreats are conducted annually to enable bank staffers to participate in planning for th e future. • O fficers m e e t at 7 a.m . ev ery M onday to discuss activities for the week in the bank and th e com m unity, such as those sponsored by churches and schools. After the officers m eet, th e e n tir e b a n k sta ff g a th e r s for a n n o u n cem en ts p rio r to th e b a n k ’s opening. • An organized program encourages outside directors to accom pany bank officers on visits to farm custom ers. Periodic visits are m ade to all bank custom ers by all m em bers of th e reg u lar board and the developm ent board. T h e b an k m a in ta in s a 2 4 -m e m b e r board of directors and a 22-m em ber developm ent board. • An annual m e e tin g is h eld for w om en who work at the bank. I t’s open to wives of bank personnel and direc tors, too. Topics d iscu ssed include banking in gen eral and th e role of w om en in banking in particular. • T he bank m aintains a m anage m ent-succession com m ittee com posed of eight outside directors divided into four two-m an team s. O nce a year, a team interview s each bank officer on a confidential basis seeking ideas, sug gestions and com plaints. The com m it tee makes a no-nam es rep o rt to the CEO . • Each C hristm as th e bank hosts a hospitality w eek that includes refresh m ents in the lobby and telepho ne calls by a bank em ployee to every custom er of the bank. Those called are w ished a M erry C h ristm a s, are th a n k e d for th eir business and are invited to stop by the bank for refreshm ents. • The bank has gained recognition th ro u g h c o n c e rts g iv en by its 36m em ber singing group, known as the Bank Notes. ’ M ore than 300 concerts have been given in six states in the past 12 years. These varied services prove that a small bank in a small town in a big state can do big things for its community! MID-CONTINENT BANKER for August, 1982 RepublicBank Dallas isn't limited by geographic bound aries. Today, our activities ex tend to every part of the coun try. And the leading activity that touches banks all over the country is our Financial Institutions Division. We have the services and the experience to meet every kind of correspond dent banking need. Our Financial Institutions Division has a full range of ser vices from cash management to bank financing and loan par ticipations. Last year, we bought and sold loans with over a thousand banks and handled over two million cash letter items daily. In our cor respondent relationship, we're more interested in the relation ship than in transactions alone. And we can tailor our services to meet your individual institu tional needs. Along with a full range of services, we match your needs with a group of top correspon dent professionals. They nave in-depth, up-to-the-minute in formation on money markets, economic trends, and current or proposed legislation that may affect the financial institutions City L im its ' mi a n c ffu tS S sal®, and acquisitions, iney know how to put together a pro ject from a stmctural to a legal standpoint, as well as how to create a solid non-credit pack age of services. At RepublicBank Dallas, you'll find the people and the services you expect from a correspondent institution, and you'll discover there is no limit to what we can do. RepublicBank Dallas We know no limits. Member FDIC MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 35 A goal for the second year is to com plete the necessary research and plan ning to sta rt a n eig h b o rh o o d -co m m e rc ia l-d is tric t re v ita liz a tio n p ro gram. W ork on the first house to be reh a b ilitated began Saturday, April 24, w ith an all-day “cleanup party. Bank officials pitched in w ith residents to rem ove boards from covered-up w in dows, pick up trash indoors and out and tear down a garage that couldn’t be saved. C om m unity C om m itm ent. In spite C D C , according to a C entral National of th e p re s e n t c o n d itio n of ta rg e t spokesperson. “In addition to m eeting the C om p houses, the C D C ’s sponsoring banks are co m m itted to striv in g to make tro ller’s re q u ire m e n ts,” says D onald C. Reed, C entral National vice presi affordable, p erm an en t financing avail d e n t and fu ll-tim e c o m m u n ity d e able to p o te n tia l b u y e rs. F o r this reason, th eir respective m ortgage d e v elo p m en t officer, “we believe this partm ents are taking p art in the selec local business/com m unity partnership tio n an d r e h a b ilita tio n d e c is io n rep resen ts a positive response to the making process. This also gives buyers P resid en t’s call for the private sector to reasonable p rio r assurance th at the assum e m ore of th e responsibilities traditionally held by the public sec houses, w hen com pleted, can support sufficient mortgages. to r.” Four-year data on area house-sales E q u ity F u n d in g . T h e B u ck ey eW oodland C D C is funded by the four volum e and prices indicate that, with participating banks through equity in careful control of costs, it will be possi vestm ents totaling $70,000, of which ble to sell the rehabilitated houses at prices sufficient to cover costs and C entral N ational’s share is $50,000. The oth er banks are BancOhio N ation m ake a sm all c o n trib u tio n to th e C D C ’s capital. al, Society National and Union C om A lthough capitalization has b een m erce. The new C D C will operate for prof p r o v id e d by th e fo u r b a n k s, th e it, but during its first th ree years, prof BW CD C truly is a com m unity orga its will be reinvested in the corpora nization. Its success will d ep en d not tion. Its goal for the first year is to only on financial support of the banks, a c q u ire a n d r e h a b ilita te fo u r d e b u t also on personal involvem ent of terio ratin g houses in a four-square- n eig h b o rh o o d resid en ts, businesses block targ et area and make them avail and civic organizations. To that end, the corporation’s board able for resale to com m unity residents. The target area was selected jointly by is stru ctu red to have in p u t from all th e banks and com m unity rep resen ta sectors. O f its 15 m em bers, six re p re sent participating banks; six are from tives. th e local com m unity and th ree from local g o v e rn m e n t. Focal m em b ers w ere recom m ended by the neighbor hood group to the stockholding banks for election. Board m em bers and officers w ere e le c te d at th e c o rp o ra tio n ’s initial organizational m eeting in February. O f th e five officers, th re e are from C entral National: Douglas E. Price, v ic e p r e s id e n t/m a n a g e r , b r a n c h b an k in g division, w ho was e le c te d chairm an; P reston K. G nagey, vice president/assistant controller, elected treasu rer, and Mr. Reed, elected ex ecutive director. The o th er two offi- A Four-Bank Project To Improve Area That's Deteriorating H E C o m m u n ity R e in v e stm e n t Act requires financial institutions to help m eet credit needs of th e ir com m unities. H ow ever, it d o esn ’t spell out how to do it. T h e r e f o r e , C e n tr a l N a tio n a l o f Cleveland, like m ost banks, has d e v eloped its own m eth o d s o v er th e years, helping w h erev er it can to re place com m unity confrontation with com m unity com m itm ent. T he b an k ’s m ost innovative com m unity program becam e reality last D ecem ber. In cooperation w ith th ree o th e r C le v e la n d b a n k s a n d th e Buckeye-W oodland C om m unity C on gress, a local n eig h b o rh o o d group, C entral N ational form ed the BuckeyeW oodland C om m unity D evelopm ent Corp. (CDC) in a d eteriorating neig h borhood on C leveland’s east side. It was ap p ro v e d in F e b ru a ry by th e C om ptroller of th e C urrency after a finding that th e C D C ’s activities would be “predom inantly civic, com m unity or public in n ature and not m erely p ri vate and en trep ren eu rial, ” as req u ired by the C o m ptroller’s In te rp re tiv e Rul ing 7.7480. Although it is th e 10th C D C to be approved since 1978, B uckeye-W ood land is th e n atio n ’s first m ulti-bank T B a n k e rs a n d local re sid e n ts co m b in e th e ir efforts to p u ll d o w n co n d e m n e d g a r a g e d u r in g c le a n u p p a r t y a t f ir s t h o u s e t a rg e t e d fo r r e h a b ilit a t io n b y B u ck e y e W o o d la n d C o m m u n it y D e v e lo p m e n t C o rp . Part of h o u se is v is ib le a t left. 36 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 T r u s tw o r th y . Third National’s Trust Division helps you help your custom ers As a banker, you’re well aware of the impor tance of maintaining strong personal relation ships with your depositors. So, when you’re asked for a service your bank is not yet ready to provide...like Personal Estate Planning, for example...offer ours. For any trust services beyond your own bank’s capabilities, get in touch with Third Na- j tional Bank in Nashville. Call Sonny Johnson, head of the Corre spondent Bank De- partment, or the representative who serves yoi area: Ish Smith or Ronny Lankford, East Ten nessee; Clarence Suiter, Middle Tennessee and Alabama; Roy Lawrence, West Tennessee Our Tennessee WATS is (800) 342- 8360. In neighboring states, dial (800) 251-8516. We can save you the expense of de veloping a full-service Trust De partment of your own while helping you to strengthen p sonal ties with your depos tors and remain competi tive in your community 1 THIRD NATIONAL BANI^ In Nashville Member F.D.I.C 3 * '- W. I. “Ish” Smith Vice-President https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cers — p resid en t and secretary — re p resent the com m unity. R epresenting the o th er banks on the board are Jerom e G. M cClain, vice presiden t, Society National; Bunn S. Rhea, assistant vice presid en t, BancOhio National, and R obert C. W ern er, vice president, Union C om m erce. R epresentatives of th e local com m unity include hom em akers, th e ow n er of a small d in er and th e p resid en t of a large auto dealership. T h ree C leve land councilm en re p re se n t th e public sector. T he board retain ed a local housing consultant, who had help ed select the four target houses, to train corporation s ta ff m e m b e rs in h o u s in g -re h a - "W e believe this local business/com m unity p a rtn e rs h ip represents a positive response to the President's call fo r the private sector to assume more o f the responsibilities tr a d i tio n a lly held by the public sec t o r / ; _______________________ bilitation techniques. T h ree com m it tees w ere form ed to help th e board and to help achieve even m ore w idespread com m unity involvem ent: com m unity advisory, m ade up of neighborhood residents, clergym en, educators and b u sin essp e o p le ; technical a dvisory, m ade up of v o lu n teer experts from such fields as m arketing, accounting, law and finance, and planning. Betting on B E T I. The corporation shares office space w ith th e Buckeye E v a lu atio n and T echnical In s titu te (BETI) in a building m ade available by th e auto-dealer board m em ber. B ETI, established by the B uckeye-W oodland C om m unity Congress early this year, is a nonprofit organization providing assistance w ith m arket research and n e ig h b o rh o o d -o u tre a c h p ro g ra m s. Eligible to receive tax-deductible con tributions and support from founda tions, BETI already has received such support from th e John Hay W hitney F oundation of N ew York City. C D C officials h o p e th a t, as skill levels of the BETI staff increase, they will assum e full responsibility for re hab-specification w riting, co ntractor selection, job supervision, etc. Also realizing the im portance of BET I’s activities to th e success of th e C D C ’s first-year plan, particip atin g banks have given financial and o th er aid, including donations of office furni tu re and eq u ip m en t and clerical su p port. Some Lessons L earned. Asked for som e in sid er tips of value to o th er 38 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis banks going the C D C route, C entral sary eith er to ren t the land to a m em N ational’s Mr. R eed says, “W e are b e r of the family as ten an t (with the fin d in g th e b u s in e s s o f a c q u irin g m a te ria l-p a rtic ip a tio n re q u ire m e n t vacant properties is a lot m ore difficult m et by the tenant) or to have a m ate than we expected. Some ow ners can’t ria l-p articip atio n crop or livestockbe located. Some properties belong to share lease to an unrelated tenant. s p e c u la to rs w ho w a n t o u tra g e o u s T here is a problem at the second prices. Some are ‘lost’ in governm ental death. mazes. O th er C D C s should be aware E x a m p le : H e n ry J o n e s r e tir e d of this and give it m ore attention in the M arch 1, 1979, from 40 years of farm planning stages than we d id .” ing and started receiving social secur M r. R eed adds th at su p p o rt of a ity benefits. The farm land was ren ted s tro n g , g ra s s -ro o ts n e ig h b o rh o o d to an u n related neighbor u n d er a non group is essential to success. m a te ria l p a r tic ip a tio n - c ro p - s h a r e “W ith o u t a strong stre e t club to lease. At Mr. Jones’ death in 1984, the w atch over an acquired property, you m aterial participation test w ould be will be rob bed blind or have to spend m et — m aterial participation for at so m uch m oney on fences, dogs and least five years of the last eight before alarm s that you’ll lose m oney on every retirem en t. If the land is left to his h o u se ,” he warns. “Extrem ely tight wife, M ary, w ho dies in 1986, the cost control is vital. As another exam q u e s tio n is w h e th e r th e m a te ria lple, it s easy to add so m any d esir participation test will be m et in h er ables’ to a house that it costs far m ore estate. As the law stands now, h er than it can be sold for.” estate is not likely to be eligible. H er Still, the mood at C entral National is estate m ust show m aterial participa optim istic, as is shown by this observa tion (by M ary or a m em b er of h er fami tion by Mr. Price: “Because the Buck- ly) or active m anagem ent (by Mary) for eye-W oodland area has relatively few five or m ore of the last eight years b e m ajor businesses and a declining hous fore h e r d eath . A p p aren tly , active ing stock, the C D C could make a sig m a n a g e m e n t by H e n ry from 1979 nificant co n trib u tio n tow ard an im through 1984 would not count as active proved quality of life for people living m an ag em en t for M rs. Jones at h e r th ere. W e as bankers m ust realize that death in 1986. M oreover, active m an one key to m aintaining neighborhoods agem ent by Mrs. Jones before 1984 in com m unities w here we do business doesn’t count because she was not a is to create financing opportunities for ‘surviving spouse” (which is req u ired low- and m oderate-incom e residents. ” for the active m anagem ent test) until 1984. T h e T e c h n ic a l C o rre c tio n s A ct w ould solve the problem by allowing m aterial p a rtic ip a tio n by a r e tire d Planning Estates s p o u s e (b e fo re r e tir e m e n t) to b e (C ontinued fr o m page 22) “tacked on” to active m anagem ent or m aterial participation by th e surviving spouse to qualify p ro perty for specialF o r leases to un related tenants b e use valuation in the surviving spouse’s fore death — and for all leases after estate. d eath — it takes a crop-share or live Conclusion. Decisions as to type of stock-share lease. It appears th at a lease and decisions ón w h eth er to sell non-m aterial-participation crop share or make a gift of pro p erty before death o r liv e sto c k -sh are lease m e e ts th e a re h ig h ly im p o r ta n t fo r e s t a t e qualified-use test. plan n in g purposes. T he m essage is • The “m aterial-participation test clear: Rules from the 1981 tax act cre req u ires th at the d eced en t or m em ber ated opportunities, b u t it takes plan of the d e c e d e n t’s family have partici ning to convert those o pportunities p ated m aterially in the operation for into reality. • • five or m ore of the last eight years b e fore th e earlier of retirem en t, disabil ity or death. F or a surviving spouse who in h erited qualified real property from a deceased spouse, “active m an Wells Fargo Credit Corp. Lance L. ag em en t” substitutes for m aterial p ar W eaver has b een nam ed vice -presiticipation. dent/corporate asset m anagem ent in T he m aterial-participation test thus this firm ’s Scottsdale, Ariz., head q u ar poses few, if any, problem s after re ters. H e joined th e com pany in 1981 as tire m e n t i f the m aterial-participation a product m anager. H e form erly was a req u irem en t was m et before retire consum er banking officer, M aryland m ent. Before retirem en t, it’s neces National, Baltimore. MID-CONTINENT BANKER for August, 1982 ien it comes to custom er preference other travelers cheques don’t stack up. In fact, they don’t even |ome close. In a recent national irvey, a majority of travelers [heque users said they want jVmerican Express® the next te they buy travelers cheques. Which isn’t surprising /hen you consider that only American Express offers five special services to help protect your customers’ vacation if their trav elers cheques are lost or stolen. We can help cancel lost credit cards, issue a temporary ID, and cash a personal check for up to $200. We even have a 24-Hour Travel Service Hotline if your customer needs help changing travel plans. And an Emergency Message Service if they want to send a message home. Combine all that with our 60,000 refund locations and nearly 1000 worldwide Travel Service Offices and you’ll see wfv most travelers cheque users feel American Express is the best bran So don’t settle for less. A majority of travelers cheque users want American Express. And if you don’t have them, they may sta asking around. Am erican Express Travelers Cheques A* $ £ 4; «A S r" % © o a <9 <9 i*rsf£i X ?A. y A https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis * A recent study shows that 64% of travelers cheque users want to buy American Express the next time they buy travelers cheques. © American Express Company 1982 Neighborhood Rehabbing: O ne Bank's Philosophy T rust, st. Louis, has m ade a substantial com m itm e n t to th e in n e r city and th e financing of its redevelo p m en t, said M e rc a n tile ’s ch airm an , D o n ald E. L asater, to a tte n d e e s at th e recen t C ities’ C ongress on Roads to Recov ery, held in Cleveland. A c c o rd in g to M r. L a s a te r , th e bank’s area of concentration has been the central core of St. Louis. Reasons for selecting that area include: • It offers a good m ixture of existing com m ercial and residential structures. • It provides good existing infra stru c tu re , in c lu d in g tra n s p o rta tio n networks to th e dow ntow n area. • It’s historically th e grow th corri dor of the city — the c en ter of the city ’s physical integrity. • It contains inexpensive acquisi tions due to blighting. • It addresses diversified m arkets, including residential and com m ercial uses. M ercantile T rust m ade its com m it m ent to th e redevelopm ent of the cen tral core area for th e following reasons, Mr. Lasater said: • M ercantile is th e largest bank in St. Louis and isn’t going to be moving; th erefo re , it m akes good econom ic sense to assist in th e red ev elo p m en t of areas surrounding th e bank. • A properly adm inistered program could be a good source of profitable lending opportunities. • As co m m ercial and re s id e n tia l areas are re d e v e lo p e d , th ey attract new business and individuals into the city and, therefore, increase th e bank’s potential custom er base. • U rban le n d in g h elp s th e bank com ply w ith various g o v e rn m e n ta l regulations, such as th e C om m unity R einvestm ent Act. Mr. L asater said th e bank’s strategy is to take a leadership role in each area in which red ev elo p m en t is going on; to act as a catalyst in each area; to identify leaders in the red ev elop m en t business and support them 100%; to stay in- M e r c a n t il e 40 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis D o n a ld E. L a s a t e r , C h ., M e rc a n t ile Trust, St. Lo u is, o u t lin e d h is b a n k ' s n e ig h b o rh o o d - re d e v e lo p m e n t p h ilo s o p h y a t recent C itie s' C o n g re s s on R o a d s to R eco very in C le v e la n d . public im provem ents such as streets, sidewalks and landscaping. It also p e r mits the use of o th er available assist ance, such as grants for exterior re n ovation. H e stressed that the key to success ful urban developm ent is to tailor d e velopm ent strategies to the peculiari ties of the existing stock, leadership, form ed in all areas and neighborhoods m arket and geographic characteristics of the city and identify th e leaders in and political environm ent of each area these areas; to becom e involved in the rath er than attem p t to im pose a solu process of city governm ent and b e tion on an area. com e familiar in the ways a local com Mr. Lasater described M ercantile’s m unity d evelopm ent agency works; to p a rtic ip a tio n in various re d e v e lo p consider a diversified redevelopm ent m ent projects in St. Louis: portfolio that includes large residential • Lafayette Square. The bank has and com m ercial projects as well as in * m ade hundreds of loans totaling m ore dividual rehab projects and projects of than $4 million since 1976 in this area not-for-profit groups. of once-elegant mansions that had d e He added that M ercantile T rust isn’t teriorated. P roperty values have risen afraid to be creative w ithin p ru d en t from the $500 that w ould purchase lending standards. alm ost any shell building in 1976 to Basic techniques and req u irem en ts m ore than $90,000 for rehabilitated for making sound redevelopm ent and hom es in 1980-81. construction loans in urban areas in • Soulard. M ercantile has financed clude the following, Mr. Lasater said: a nu m b er of hom e-ow ner rehabs in • Apply and follow all underw riting this neighborhood, b u t the largest im p ro c e d u re s norm ally u sed for con pact has been from financing a single struction lending. developer who renovates investm ent • Make every effort to d eterm in e p ro p e rty on a s c a tte re d -s ite basis. th e structural integrity of a building. Rentals have gone from an average of • Take a long, hard look at the loca $80-$ 100 p er m onth to from $250-$425 tion of th e proposed redevelopm ent. p er m onth in reh abbed structures. • Make sure, particularly in larger • H yde Park. M ercantile has made projects, that a strong general contrac or com m ited loans to rehab m ore than tor is handling the job. 60 units of Section 8 housing in this • Be su re th e b o rro w e r has th e neighborhood. M ercantile form ed a financial stability necessary to support com m unity developm ent corporation th e hidden pitfalls found in these types designed to stim ulate in terest in the of projects — pitfalls such as cost over neighborhood through a professional ru n s, c o n s tru c tio n delay s, slow er- m arketing, research and inform ation than-anticipated m arket acceptance. program . • Encourage the borrow er to use an • Pershing L a n d . W ith M ercantile’s a rc h ite c t who is sensitive to u rban financing assistance, about 1,000 re n t neighborhoods and experienced in re al units have been rehabbed; several d evelopm ent projects. form er apartm ent buildings have been W h e n e v e r possible, M r. L asater converted to condom inium s and 100 said, red ev elopm ent projects should duplex units are planned as the first be coordinated with the public sector. new subdivision w ithin the city in 50 This perm its the maximization of block years. C om m ercial developm ent also grant funds that can provide for off-site is underw ay. • • MID ■CONTINENT BANKER for August, 1982 AFTER 37 YEARS OF BANKING, I JUST TOLD MY BEST CUSTOMER TO GET HIS MONEY SOMEPLACE ELSE. Someplace else is Armco Industrial Credit Corporation. W h e n y o u r v a lu e d c u s to m e r s n e e d h ig h e r le n d in g lim its o r m o r e s p e c ia liz e d c re d it a r r a n g e m e n t s th a n y o u r b a n k c a n offer, th a t’s w h e n w e c a n h e lp . W e o ffer b a n k e r s a h a p p y a lte rn a tiv e to re fu s in g g o o d c u s to m e r s e x t e n d e d fin a n c in g . It’s c a lle d A IC C Participation Lending. S e c u r e d p a rtic ip a tio n le n d in g p r o g r a m s a re d e v e lo p e d b y AICC to b rid g e th e g a p s in n o r m a l fin a n c ia l s e rv ic e s y o u r b a n k o ffe rs c o m m e rc ia l c lie n ts. W ith AICC a s a p a rtn e r, y o u c a n offer: e x te n d e d le n d in g lim its, flexible fin a n c in g to k e e p p a c e w ith fa s t c u s to m e r s a le s g ro w th , fin a n c in g o f MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis c u s to m e r a c q u is itio n s , s e c u r e d e q u ip m e n t le n d in g , e v e n re c e iv a b le s a n d in v e n to ry fin a n c in g . A n d , b e s t o f all, y o u k e e p a g o o d c u s to m e r h a p p y a n d c o m in g b a c k for fu tu re b a n k in g n e e d s . F o r m o r e in fo rm a tio n , call o r w rite: A rm c o In d u stria l C re d it C o r p o r a tio n , D e p t. F C -4 3 2 , 2 8 0 0 R o c k c re e k , S u ite 6 0 4 , N o rth K a n s a s City, M isso u ri 6 4 1 1 7 . 8 1 6 /4 2 1 - 5 7 4 5 . ARMCO V ARMCO INDUSTRIAL CREDIT CORPORATION S ubsidiary o f A rm co Financial C orporation 41 New Twist to Corporate Giving Developed by American Express ORPORATE giving is som ething m ost banks are locked in to. Benefits include publicity for th e bank and im provem ent of th e b ank’s com m unity as a desirable place to live and conduct business. B ut re c e n t eco n o m ic c o n d itio n s have p u t th e sq u eeze on corporate profits and, often, on a bank’s ability to contribute to various civic organiza tions th a t d e p e n d on donations for th eir existence. This situation p ro m p te d m anage m ent of A m erican E xpress to com e up w ith a new angle on corporate giving — one that enhances the d onor’s b o t tom line rath er than reacting adversely on it. The concept is to donate a portion of a firm ’s increased profits due to new business gen erated by a cam paign to support one or m ore cultural or civic activities. F o r in sta n c e : A m erican E x p ress d o n ated m ore th an $100,000 to an organization th at runs M ount V ernon, hom e of th e n ation’s first P resident. And, in m aking th e public aware of its support for M ount V ernon, A m erican E x p re s s o r ig in a te d a s u b s ta n tia l am o u n t of a d v e rtisin g in th e local m edia that served to focus attention on M ount Vernon and its n eed for finan cial support, as well as for A m erican Express products. Early this year, A m erican Express announced w hat it te rm e d “a m ajor new pro g ram com bining m ark etin g w ith corporate philanthropy, designed to assist w orthy causes facing inflation ary costs and funding cutbacks.” The program provided custom ers of A m er ican Express w ith an opportunity to help raise funds for M ount V ernon by using th e ir A m erican Express cards or p u rch asin g A m erican E xpress tra v elers cheques. The firm announced that a donation would be given to M ount V ernon for each Am erican Express card transac tion taking place in th e W ashington, D. C., area for a th ree-m o n th period. “ T h e c o m p a n y e x p e c ts th a t W ash in g to n -area re sid e n ts, visitors and businesses will help A m erican Ex p ress raise consid erab ly m ore than $100,000 for M o u n t V e rn o n ,” said Louis V. G erstn er J r ., vice chairm an at American Express. “And we in ten d to support this effort w ith a substantial C 42 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis am ount of advertising, both for M ount V ernon and for Am erican Express. ’’ M a jo r b u s in e s s e s in th e a re a launched jo int prom otions in response to A m erican E xpress’ initiative. H e re ’s how the plan worked: T hree cents was donated each tim e an A m er ican Express card was used in the area; $2 was given for each resid en t whose application for a new A m erican Ex press card was approved during the campaign; 50 was donated every tim e A m erican Express travelers cheques w ere purchased. Ads announcing the program told th e public that contributions by A m e r-' ican Express would help keep down th e cost of public adm ission to M ount Vernon. “O ur donation will go tow ard f u r th e r d e v e lo p m e n t o f th e tw oc e n tu ry -o ld e sta te , u n til now su p po rted solely by adm ission charges to visitors and private contributions, with no governm ent funding of any k in d ,” Mr. G erstn er said. BE A PILLAR OF M OUNT VERNON. BUY SOME AMERICAN EXPRESS TRAVELERS CHEQUES. Take a long weekend in Nassau. This is an easy way for all of landmark of American history Visit old friends in London and us to salute General Washington And, while you travel, you Rome Or simply go to Baltimore on his 250th birthday. And to help might just make a little history for the day. support Mount Vfemon. a trreat yourself. Wherever you go. just be sure you take along some American Express’ Travelers Chequesthe travelers cheques known and accepted around the world. And when you ask for American Express Travelers Cheques at your local financial institution, you’ll also be answer ing some of the needs of Mount Vernon. Because from now to April 30,1982, when you buy American Express Travelers Cheques at any of the financial institutions listed here, American Express will donate 5c to Mount Vernon. Now 5c may sound like a modest amount, but when you multiply that by thousands of pur chases, you get a sum no one has to be modest about. A d p ro m o tes s a le s of A m e r ic a n E x p re ss t ra v e le r s c h e q u e s in W a s h in g t o n , 6 . C ., a r e a to su p p o rt M o u nt V e rn o n , h o m e of G e o rg e W a s h in g to n . A d lists a ll f in a n c ia l in stitu tio n s in a r e a s e llin g c h e q u e s . For t h r e e m o n th s , A m e r ic a n E x p re s s m a d e d o n a t io n to M o u n t V e r n o n w h e n e v e r ch e q u e s w e re so ld . O ne of the ads prom oting the p ro gram fe a tu re d th e nam es of ev ery financial institution in the W ashing ton, D. C ., m e tro p o lita n area th a t offered A m erican E xpress trav elers cheques. The catchy headline for the ad read: “Be a pillar of M ount V ernon. Buy some Am erican Express travelers ch eq u es.” “Giving by corporations is not a new p h e n o m e n o n ,” said W illia m M. M cCorm ick, president, A m erican Ex p ress C o n su m er Financial Services G roup. “H ow ever, A m erican Express was looking for new ways of co n trib u t ing to w orthw hile local enterprises, given the cutbacks in both private and public funding, and in view of escalat ing costs that affect nonprofit in stitu tions as m uch as com m ercial e n te r prises. The use of m arketing dollars by m ajor com panies to both support local causes and build businesses could be a m uch-needed new source of funding for w orthw hile causes of all k in d s.” T he success of A m erican E xpress’ c o r p o r a te - d o n a tio n p ro g ra m has p ro m p te d th e firm to conduct p ro grams in o th er areas of th e nation. T hree program s w ere conducted in Texas recently. O ne in H ouston n e tted $89,000 for th e T h eatre U n d er the S tars. T h e D allas B allet re c e iv e d $104,000 and the M useum of Art in San Antonio benefited by a $41,000 donation. Five program s w ere conducted in California, w ith the m ost successful r e sulting in a donation of $108,000 to the N eighborhood Arts Program /Festival in San Francisco. The donation en abled the festival to continue its opera tions. A m erican E x p re ss re c e n tly con cluded a program in St. Louis to assist th e Arts and E d u catio n C ouncil of G reater St. Louis. N ew spaper, m aga zine and TV ads explained the p ro g ram , c o m p le m e n te d by p o in t-o fpurchase advertising in restaurants, hotels, retail shops and d ep artm en t stores. A $65,000 donation resulted. In addition to th e types of new business m entioned earlier in this article, the St. Louis program included donations for d oing b u sin e ss w ith S h earso n / Am erican Express: a $1 contribution for each com m issionable transaction and $5 for every new account opened. MID-CONTINENT BANKER for August, 1982 We're blow ing our cover on w ire transfers All banks transfer money. But nobody talks about it. It’s one of those quiet, ignored sort of services. We think it’s time wire transfer got the limelight it deserves. Each year w e transfer up wards of 10 trillion dollars. So wire transfer is certainly important to us. And it’s important to you, too. Delayed transfers mean delays in your investments. Fast is what you want. And with us, you’ll get it. We can make transfers at supersonic speed. You may call it magic. We just call it progress. But actually it’s called electronic transfers. Not only are they faster, they’re more convenient. Instead of spending hours on the phone each day, you can authorize transfers in advance. T hey’ll be handled auto matically. Electronic transfers can minimize your aggravation while maximizing your - r— efficiency. Whether you choose the electronic mode of trans fer or the traditional phone or mail, you can be sure w e’re over-cautious about errors, absolute sticklers about " security. Call E. Gerald Gale at (312) 828-6781. And ask about wire transfer. We may not wear trenchcoats or carry cryptic decoders, but w e excel at this secret service. ' CONTINENTAL BANK 125th ANNIVERSARY C o n tin e n ta l Illinois N ational B a n k an d T ru s t C o m p a n y of C h ic ag o , 231 S o u th L aS alle S tre e t, C h ic ag o , Illinois 60693 A tlan ta • C h icag o • C le v elan d • D allas • D e n v e r • D etroit H o u sto n • Los A n g e le s • M in n eap o lis • N e w York S an F ra n c isc o • S eattle • W hite P la in s. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 43 M illio n -D o lla r Loan-Fund Sale Boosts Econom y o f Bank's A re a NE M IL L IO N dollars have been invested in th e econom y of Ida Grove, la., by Ida C ounty State. And the payoff for the b ank’s trad e area is expected to be about $5 million, con sidering retail-dollar turnover. The bank m ade its investm ent in an unusual m anner — it offered th e funds in the form of loans bearing a 10% rate! The program was launched early in F ebruary and was advertised to con tinue until the $1 million was spoken for, which was estim ated to be July 1. But so m any people in th e area saw the benefits of low -interest funds that the pot was com pletely em pty by early June. Jam es L ip to n , p r e s id e n t o f th e bank, says th e re w ere a few strings tied to the loan funds: B orrow ers had to be custom ers of th e bank and had to be credit worthy; funds had to be spent with m erchant-custom ers of th e bank; borrow ers had to provide th e bank w ith proof of purchase, and a down paym en t of 25% was re q u ire d (but item s purchased could be used as col lateral). The 10% rate was g u aranteed for one year. After th at tim e, it reverts to th e bank’s variable rate. Loan limits w ere $7,500 m axim um and $100 m ini mum and loans w ere in th e form of joint checks to b u y er and m erchant. Mr. Lipton launched th e program because “we w ere looking for a way to help stim ulate our own econom y, as well as to assist our individual custom ers and our retail-m erchant custom ers. “ W e h it on th is plan b ec a u se it helped both of those segm ents of our custom er base as well as contributing to th e overall benefit of our local econ om y.” At th e tim e the program was an nounced, Mr. Lipton com m ented that th e tim es m ight not be the b est for some people to be incurring debt, “b ut th e re are some w ho m ust purchase item s and goods regardless of c u rren t c o n d itio n s, so w e h o p e this h elps th e m .” H e added that the program was ex p ected to cost the bank about $75,000, b u t th e assistance it w ould provide the bank’s custom ers and the local econ om y “will pay off in the long run. ” H e said he considers the loan program to b e an in vestm ent in the future of Ida Grove. A bout 300 custom ers took out loans and th e funds w ere spent am ong 50 to 60 m erchant custom ers of the bank. Since Ida Grove is a farm ing com m unity, the m ajor portion of loans was farm re la te d . T h e la rg e s t a m o u n t ($324,865) was used to purchase feed and fertilizer. A nother $240,155 w ent tow ard th e purchase of autom obiles; $144,206 was used to buy livestock; alm ost $100,000 w ent for m achinery; $ 6 4 ,8 7 2 w as u s e d for h o m e -im p ro v e m e n t loans; $47,809 w en t for seed purchases; $38,572 for fuel and oil; $15,222 for furniture and appli ances and $29,034 for m iscellaneous item s. O ne car dealer was so thrilled with th e response to the program that he w rote Mr. Lipton a thank-you le tte r in w hich he stated the increased business has m ade it a pleasure to go to work in th e m orning. “W e feel our program has b een a trem endous success from the positive Just a p h o n e c a l l f jj aw ay. J ff N o w a itin g N o w o rry Available now throughout the Mid-Continent area. Other temporary facilities in various sizes. 44 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MPA SY STEM S^ 4120 Rio Bravo El Paso, Texas 79902 (915) 542-1345 or (915) 542-1461 A d a n n o u n ce d a v a ila b ilit y of $1 m illio n in lo a n fu n d s a t 1 0 % ra te to cu sto m e rs of Id a C o u n ty S ta te , Id a G ro v e , la . A ll fu n d s w e re co n tracted for w ith in fo u r m o n th s. reports we have received from m e r chants and custom ers alike,” Mr. L ip to n says. “T his p ro g ra m was ju s t another exam ple showing it does make a difference w here you b an k .” Ida C ounty State had about $50 m il lion in deposits at the end of 1981. I t’s one of two banks in the com m unity of Ida Grove. • • Toy Banks in Spotlight Toy b a n k s a re not a th in g of th e p a st! C h i ca g o C ity B a n k re ce n tly a s s e m b le d th is d is p la y of a n t iq u e a n d c o n te m p o ra r y toy b a n k s , so m e of w h ic h w e re co n trib u te d by e m p lo y e e s. C u sto m e rs w e r e a s k e d to se le ct th e m o st u n u s u a l b a n k . Th e b a n k e m p lo y e e d o n a tin g th e w in n in g toy re ce iv e d a p riz e . A t th e e x h ib it's co n clu sio n , cu sto m e rs p a r t ic ip a t in g in th e b a llo t in g w e re e lig ib le for a n a t-ra n d o m d r a w in g . MID-CONTINENT BANKER for August, 1982 Mr. Bank President, there are few things left that are easy to use, yet work so w ell. The Ecom computer system for banks is one. We call it total bank control. A computer system designed especially for banks, by bankers. With sophisticated reporting capabilities, yet ease of opera tion, all communications are in simple English. As an Authorized Digital Computer Distributor we can give u the best of two worlds: hardware from Digital Equipment Corporation, the leading manufacturer of interactive computer system s; and application software and services from Ecom Systems, Inc. Contact Dennis J. Davis, Ecom Systems, Inc., 2500 Mt. Moriah Road, Suite 245, Memphis, TN 38115, (901) 794-5501. e© N \ ECOM SYSTEMS. INCORPORATED AUTHORIZED J V: 1 COMPUTE? DISTRIBUTOR MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 45 Community Development: Does It Pay O ff for Banks ? T H O SE banks that are m ost active in local economic developm ent are very profitable,” says a H U D -funded study by the Council for N ortheast Econom ic Action, Boston, an independent, nonprofit research organization. Following is a collection of articles detailing how banks have been actively working w ithin their com m unities to develop projects, assist organizations with projects and m eet com m unity needs. Tourism Promoted W hat is th e to urist w orth to a com m unity? Ask any han k er located near Table Rock Lake or Lake of th e Ozarks (Mo.), and h e ’ll probably say, “H e ’s our best crop!” But to th e en tire state of M issouri or cities like St. Louis and Kansas City, the tourist dollar often is overlooked in favor of a new m anufacturing plant or an expansion of o th er industry. Richard Ford, p resid en t of C e n te rre Bank, St. Louis, stated recently that “tourism is m ore than a visitor com ing to town, eating in a restau ran t and staying in a hotel. All business benefits from a thriving tourism and travel in d u stry ,” he noted. T hat’s why his bank focused on to u r ism last year in its annual econom ic developm ent program . At th at tim e he stated: “Few people realize th at to u r ism ranks as one of M issouri’s top th ree in d u stries.” H e no ted th at travelers spent $3.9 billion in M issouri (1980), generated $117 m illion in state tax rev enues and $47 million in local tax re ceipts. As part of its annual econom ic p ro gram, C e n te rre Bank (formerly F irst N ational) b ro u g h t to g e th e r r e p r e sentatives of all facets of th e tourist industry to gain w idespread support of statew ide o p p o rtu n itie s afforded by the tourism industry. In one of its p re v io u s econom ic program s, C e n te rre Bank focused on p ort dev elo p m en t on th e St. Louis riverfront. St. Louis is second only to New O rleans in total econom ic activity as a M ississippi River port. 46 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Playlets for Louisville lower m edical and insurance costs, d e creased a b sen teeism and increased productivity and job satisfaction. T he w eek ’s activities c u lm in ated w ith the first annual corporate 6.2mile race, which attracted m ore than 300 runners. C ontinental Bank’s m edical direc tor, Dr. Joseph C. King, said, “W e are hosting this first-tim e event because we feel that em ployees involved in health-related program s are m ore fit, will ultim ately do a b e tte r job and also live lo nger.” C ow tow n Run Attracts 3,500 In v o lv e m e n t in th e a rts is im p o rta n t a t L o u is v ille 's L ib e rty N a t io n a l. T h e b a n k jo in ed in p a rtn e rsh ip w ith A cto rs T h e a tre th is y e a r to p ro d u ce th e "L ib e rty M in i F e st," a gro up of p la y le ts , e a c h fiv e to 10 m in u te s lon g , th a t w e r e p erfo rm ed a t m a n y lo c a tio n s th ro u g h o u t th e city in M a y . The p ro j ect p ro ved to be a n in n o v a t iv e w a y to in tro d u ce th e a t e r a rts to th e co m m u n ity . Pic tu red a re tw o a cto rs p e rfo rm in g on e of th e p la y le ts , to th e d e lig h t of Lib erty N a tio n a l's C h a ir m a n F ra n k B. H o w e r Jr. Toning the Muscles The first annual “C orporate-F itness W eek” was sponsored recently in C h i cago by C ontinental Bank. Displays and lectures on h ealth-related topics w ere held throughout the week. Sixteen o th er Chicago-area corpora tio n s p a rtic ip a te d in a ctiv ities d e sig n ed to p ro m o te th e con cep ts of health and fitness am ong em ployers and individuals. D u rin g th e w eek , b u sin e ss and h e a lth -re la te d agencies en co u rag ed individual and corporate participation in fitn e ss p ro g ra m s and p ro m o te d aw areness am ong healthy em ployees of th e tangible benefits, w hich include M a ra th o n s a re for r u n n e r s an d hanks are for money. So w hat’s a m ajor dow ntow n F o rt W o rth hank doing s p o n s o rin g o n e o f th e a r e a ’s to p m arathons? G enerating a lot of support for the com m unity, say officials at F o rt W orth N ational. The bank was one of the sp o n so rs o f th e a n n u a l C o w to w n M arathon and 10K Run early this year. The bank has been involved in th e run since its inception four years ago and involvem ent am ong bank personnel is alm ost total. E m ployee involvem ent is one of th e unexpected benefits the b a n k gain s from m a ra th o n s p o n sorship. M ore than 50 em ployee volunteers signed up to assist during this year’s race. They served as course m onitors, working registration booths and h elp ing in first-aid stations. Som e also served as volunteer com m ittee chair m en. As a sponsor, the bank helps pay for advertising, T-shirts, salaries for offduty police and the grand prize — a trip to the Boston M arathon. The bank values its exposure w ithin th e com m unity and across the country. “ O u r c o n trib u tio n is h elp in g m ake F o rt W orth a better-know n place and bringing outside people into the city ,” said a spokesperson. A bout 3,500 p ar ticipated in this year’s race, coming from every state in the U. S. (C ontinued on page 48) MID-CONTINENT BANKER for August, 1982 H O W T O W IN A T C A R D S. CHOOSE UNION FOR YOUR PARTNER. hy switch credit card partners? How about increased profitability, for openers? We offer substantial dis counts which, alone, should w arrant your im m ediate interest. But, that’s not all Union has to offer. W e’ll help set up your credit card program and advise you to any extent you desire, however, unlike relationships of this kind with other banks, you will be free to design and adm in istrate your program as you see fit. Additionally, Union will provide all supplies, W ' https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis brochures, plastics and sales training support. Many m ore profitable benefits to yourself and your custom ers are afforded by Union’s advanced credit card processing technology and superior data p ro cess ing capability. Call Ralph McMaster soon at 1-501-378-4322. And w e’ll put our cards on the table. Bears Cheer Kids Community Development (Continued) So Proudly They Wave A W o rth w h ile Fire? E n c o u ra g in g c itiz e n s to fly th e Am erican flag is a priority at Republic Bank, Tulsa. The bank recently kicked off its th ird annual “Fly Your Flag” cam paign by donating 25 U. S. flags to Tulsa nursin g hom es and a historic Betsy Ross flag to a local A m erican Re gion post. In addition to the new nylon 3x6foot flags, packets containing flag pins, “ I ’m p r o u d ” b u m p e r stic k e rs and booklets on U. S. p re sid e n ts w ere given to nursing hom e adm inistrators to take to th e ir residents. “ W e fe e l s tro n g ly th a t s e n io r citizens who are b ed rid d en should be able to take p art in flying our Am erican flag and appreciate as m uch as anyone th e tru e m eaning of p atrio tism ,” said bank P resid en t R. R. Bastian III, w hen th e flags w ere presen ted . A year ago, the bank donated 31 flags to Tulsa fire stations. Republic Bank donated the Betsy Ross flag to the A m erican Region po st’s perm an en t collection of historic flags. T he collection was on exhibit at th e bank for a m onth prior to th e F o u rth of July holiday. At first it was a disaster — w hen the historic W ort H otel b u rn ed in Jackson H ole, Wyo. — b u t th e fire may have b een a blessing in disguise! T he 40year-old hotel has b een restored, u p graded and now m eets c u rren t b u ild ing-code requirem ents. O riginal efforts to reconstruct the dam aged stru ctu re w ere frustrated by p e rs is te n t financing p roblem s un til F irst W yom ing Bank of Jackson H ole facilitated the purchase of $4.1 million of industrial rev enue bonds. Initially, hotel reconstruction was to cost $3.25 m illion, b u t as plans changed, the cost increased to $4.1 million. It was th en that F irst W yo m ing Bank and o th er affiliates of W yo m ing B ancorp., the state’s largest m ul tibank holding com pany, step p ed into th e picture. Now, in addition to having covered costs of th e hotel restoration, th e bond issue also provided for construction of a convention center. The c en ter and th e hotel now will attract m ore visitors to Jackson H ole as well as provide m eeting rooms for local organizations. M ilitary v e te ra n s will re m e m b e r th at old warning: “F ire in the hole!” Looks as though this tim e a fire in Jackson Hole paid off! Calling all Good Citizens Searching for a com m unity’s good citizens can be a form idable task, b u t w ith the help of various com m unity residents and officials, P lanters Bank, Salina, Kan., had no trouble com piling a roster of w orthy individuals as candi dates to receive its Good C itizenship awards for 1982. N om inations w ere solicited early in May by a selection com m ittee consist ing of representatives from th e m ayor’s office, a civic organization, th e local m edia and th e bank. T h ere was no shortage of w orthy nom inees nor of appreciative Salinans who took tim e to w rite nom inating letters. T he aw ard fu n d was e sta b lish e d through a $10,000 tru st fund co n trib u ted by th e bank in 1976. In te re st earned on th e fund is used for th e cash awards each year. The $1,500 available this year was divided th re e ways and w inners’ nam es w ere engraved on a com m em orative plaque honoring all recipients. The plaque hangs in the governm ent center. 48 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C h ild r e n p a t ie n t s a t t h r e e h o s p it a ls in O k la h o m a C it y w e r e c h e e re d b y th e a r r iv a l of six-foot te d d y b e a r g ifts e a r ly th is y e a r . Th e b e a rs w e r e d o n a te d b y Lib erty N a tio n a l, O k la h o m a C it y . T h e y h a d b e e n on d is p la y a t th e b a n k in co n n ectio n w ith a p re m iu m o ffer. S h o w n d e liv e r in g a b e a r to a h a p p y p a tie n t a re L a tricia H a rp e r (I.) a n d L in d a M oore, b a n k o ffice rs. Promoting Awareness “W hat I Plan to C o n trib u te to My C om m unity in My L ifetim e” was the am bitious title of 100 essays subm itted in a recen t com petition for high school seniors sponsored by Lincoln N ation al, F ort W ayne, In d ., in cooperation w ith a local radio station. Five finalists w ere selected, each re ceiving a $100 scholarship award. O ne of the five subsequently was aw arded a $2,500 scholarship. Purpose of th e com petition was to prom ote aw areness and scholarship in th e young people of the g reater F ort W ayne com m unity. Judging was by a panel of educators. Gathering the Yen How w ould your bank’s staff react to an influx of custom ers from a country halfway around the w orld — custom ers w hose m annerism s and custom s w ere alien to A m ericans? C hances are, m any em ployees w ouldn’t know how to act and the bank w ould run the risk of insulting its new -found custom ers. W hen M urfreesboro (Tenn.) Bank acquired a $25-million annual payroll account for a new Nissan auto plant being built in the area, it com m issioned a local farm er w hose wife is Japanese and who once w orked for th e State D ep artm en t in Japan to sensitize em ployees to Japanese customs. The bank also arranged hom e m ortgages for some of the 70 Nissan executives and supervisors who w ere overseeing the auto plan t’s con struction. The plant is located in Smyrna, T enn., b u t M urfreesboro Bank just h appened to have o p ened a branch that tu rn ed out to be the nearest bank to the plant site. It was a lucky break for the bank, adm its bank C hairm an Jack O. W eatherford, b u t subsequent moves by the bank to provide n eed ed financial services to Nissan personnel w ere based on sound planning. MID-CONTINENT BANKER for August, 1982 In vestm en t Services Since 1 8 9 0 UNDERWRITERS— DISTRIBUTORS— DEALERS S T I F E L , N I C O L A U S & COM PAN Y INCORPORATED MEMBERS NEW YORK STOCK EXCHANGE, INC. AMERICAN STOCK EXCHANGE, INC. MIDWEST STOCK EXCHANGE, INC. N ational H eadquarters: 500 North Broadw ay, St. Louis, Missouri (314) 342-2000. Private Wires to Tröster Singer Stevens Rothchild C o rp ., Jersey City and Asiel & C o ., New York City. CONTACT OUR OFFICE MOST CONVENIENT TO YOU: KANSAS CITY, MISSOURI OKLAHOM A CITY, OKLAHOM A 73102 Leawood Corporate Manor Bldg. 4701 College Blvd. Leawood, Kansas 6621 1 913-381-7181 Suite 130 Century Center 100 West Main Street 405-235-5700 ST. LOUIS, MISSOURI 63102 1924 South Utica 918-743-3361 500 N. Broadway 314-342-2000 LOUISVILLE, KEN TUCKY 40270 201 West Main St. 502-587-6053 TULSA, OKLAHOM A 74104 WICHITA, KAN SAS 67202 1 1 1 South Main 316-264-6321 ASHLAND • BROKEN ARROW • CHICAGO • CHICAGO HEIGHTS • CLAYTON • COLUMBUS • DENVER EL RENO • ENID • GREENWICH • KEOKUK • LAWTON • LEAWOOD • LIBERTY • LITTLE ROCK • LOUISVILLE MANHATTAN • MAYFIELD • MEMPHIS • MILWAUKEE • MOLINE • MT. VERNON • NORMAN OKLAHOMA CITY • OKLAHOMA CITY NORTHWEST • PAULS VALLEY • ST. LOUIS • SHAWNEE SPRINGFIELD • TULSA • WICHITA • YUKON Member SIPC MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 49 T h is is cW h e a t C o u n try ' Kansas has earned world-wide reputation as the producer of high yield quality wheat. Hutchinson National Bank and Trust Company has earned the reputation as the professionals in Correspondent Banking. So, when it comes to Grain Drafts, call the specialists at Hutchinson National Bank 77 50 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 Dl D C , Sales-Training Techniques O n Tap for Kansas Regional Meetings Six-Meeting Schedule Will Begin September 21 in Dodge City E D E R A L regulating bodies and sales techniques will be spotlight ed at next m o n th ’s regional m eetings of th e Kansas Bankers Association. Final program arrangem ents w ere not com p lete at presstim e. The m eetings will be held from S ep tem b er 21 to 29. Form at will be sim ilar to th at at last year’s m eetings. Each regional will b e gin w ith a county ag ricu ltu ral keybanker luncheon, beginning at 11:30 a.m . R egistration will begin at 1:15 p.m . and th e general sessions will run from 2 to 5:15 p.m . Regional vice presid en ts will p re side at th e C E O sessions. Principal topic at these sessions will be th e inac tion of federal regulators, specifically th e D epository Institutions D ereg u la tion C om m ittee (D ID C ). This body, established by C ongress to dereg u late banking, has b een severely criticized by bankers for not com ing up w ith products bankers can use to com pete w ith m oney-m arket funds. KB A P resi d en t John G. M cNay, p resid en t, City National, Pittsburg, is expected to take part in these sessions for C E O s. F Regional Calendar September 21 — Region Six —Dodge City — Dodge City Com munity College. September 22 — Region Five — Hays — Fanchon. September 23 — Region Three — Manhattan — Kansas State Stu dent Union. September 27 — Region Two — Chanute — Neosho County Com munity College. September 28 — Region Four — Wichita — Century II. September 29 — Region One — Lawrence — University of Kansas Student Union. T hree, Five and Six. Schedules, nam es of regional vice p residents and secretaries of the KBA regions are: Region One, S ep tem b er 29, after noon session and banquet, U niversity of Kansas S tudent Union, Law rence; regional VP, Jerry B redw ell, p re si d e n t, C o m m e rc ia l S ta te , B o n n e r Springs; regional secretary , D ennis M eyer, executive vice p resident, P at rons State, O lathe. T he m id d le -m a n a g e m en t and su pervisors’ session will b e p resid ed over by regional secretaries. A program will be p resen te d by H ay T raining C o., P h ila d e lp h ia , th a t w ill c o v er sales te c h n iq u e s for b a n k e rs, c u sto m e ro riented p roduct know ledge inform a tion and how to m ake effective b u si ness-developm ent calls. Following th e general sessions will be a refresh m en t break, th en the social hour, th en th e annual b an q u et. Ban q u et speakers will be N ew t H ielscher and R obert H enry. Both are hum orists w ith m essages. M r. H ie lsc h e r will speak at regions O ne, Two and F o u r and Mr. H enry will appear at regions MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Region Two, S ep tem b er 27, after noon session, N eosho C ounty C om m u n ity C o lleg e, b a n q u e t at V FW Hall, both in C hanute, regional VP, W . G. B odley, p re sid e n t, Bank of C om m erce; regional secretary, Paul Viets, p re sid e n t, C itizens N ational, Independence. Region Three, S ep tem b er 23, after noon session and b a n q u e t, Kansas State U niversity S tudent Union, M an hattan; regional VP, D avid Fow ler, president, F irst State, B urlingam e; re gional secretary, Jeffrey J. H olm es, president, Riley State. Region Four, S ep tem b er 28, after noon session and banquet, C en tu ry II, W ich ita; reg io n al VP, W. N ew ton M ale, c h a irm a n /p re s id e n t, P ra irie S tate, A ugusta; regional secretary , D on G rim ood, c h airm an /p resid en t, Segwick State. Region Five, S eptem ber 22, after noon session location to be announced, b an quet to be at the Fanchon, Hays; regional VP, Jean Noel Jr., chairm an/ president, F irst National, Glasco; re gional secretary, R. D. Jones, p resi dent, Farm ers National, O berlin. Region Six, S ep tem b er 21, after noon session, D odge C ity C om m unity DOUGLAS AND TOPEKA • WICHITA, KANSAS 67202 316-264- 5303 Member FDIC The Active Independent Bonk in Wichita 51 Regional Vice Presidents FOWLER BREDWELL BODLEY KANSAS ENERGY BEGINS WITH KANSAS BANKS. KSB&T can be your pipeline to energy financing. College, b an quet at H olidom e C on vention C enter, both in D odge City; regional VP, K eith Scott, president, V alley S ta te , S y ra c u se ; re g io n a l secretary, Boyd Mills, executive vice p resident, H om e State, Lewis. Jerry Bredwell, VP of Region One, e n te re d banking in O ctober, 1967, at R anchm art State (now F irst C o ntinen tal), O verland Park. H e joined C om m ercial S tate, B o n n e r S prings, as president, in M arch, 1977. H e also is C EO . W. G. Bodley, VP of Region Two, has been a banker since May, 1958, and has been at Bank of C om m erce, C hanute, since that tim e. H e began his career as vice presid en t and was nam ed chairm an in M arch of this year. The banking career of David Fow ler, VP for G roup T hree, goes back to 1943, w hen he jo in ed H om e State, A rc a d ia . H e b e c a m e an a s s is ta n t national bank exam iner in 1958 and joined M etcalf State, O verland Park, in 1962. H e was nam ed cashier/director at F irst State, B urlingam e, in 1964 and has been p resid en t/d irecto r since 1974. W. N ew ton M ale, VP for G roup Four, joined Boulevard State, W ichi ta, in 1953 to begin his banking career. H e joined Prairie State, Augusta, in 1960 as cashier, was nam ed presid en t in 1978 and chairm an this year. Jean Noel Jr., VP for Region Five, began his banking career w ith F irst National, Topeka, in 1970. H e joined F irst of Glasco in 1976 as executive vice president. K eith S. Scott, VP for Region Six, joined his presen t bank, Valley State, Syracuse, in 1958 as cashier. H e was nam ed p resident/C E O in 1971. • • M. Max Dickerson Dies Member FDIC KANSASSTATEBANK AND TRUSTCOMPANY 123 N. Market / Wichita, Ks. 67202 7(316)266-6600 52 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis M. M ax D ickerso n, 6 7 , v .p . a n d h e a d of th e c o r re s p o n d e n t b a n k in g d e p a rtm e n t, C o m m e rc ia l N a t'l, K a n s a s C it y , d ie d s u d d e n ly o f a h e a r t a t ta c k J u ly 6 . He jo in ed th e b a n k in 1 9 5 8 a fte r h a v in g been a co u n ty a g ric u ltu ra l a g e n t fo r S t e v e n s , L e a v e n w o rth a n d B ro w n C o u n tie s. H e w a s a d irecto r of th e 4-H F o u n d a tio n a n d a fo r m e r p re s., K a n s a s A s so c ia tio n of B a n k A g r i c u lt u r a l R e p r e s e n t a t iv e s . M r. D ick e rso n a lso w a s on th e b o a rd s of K e n d a ll S ta te , V a l l e y F a lls ; E d w a r d s v ille S t a t e ; H o x ie S ta te a n d D e c a tu r C o u n ty N a t'l, O b e rlin . H e w a s a m e m b e r of th e b o a rd of g o v ern ors of th e A g r ic u ltu r a l H a ll of F a m e in B o n n er S p rin g s. MID-CONTINENT BANKER for August, 1982 T h e . n e w B > o a r d W ill i~ e s t ~ y o u r in a n e r v e " th e s m in e a -fo r b a b a + f le R e g u la - f io n n k e r s 't h e ! — - f o r s u r v iv a l J u n g l e * Mow USED b T/ aopt th a n 3S0 IN MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 15 BANKS STA TES. 53 D em and fo r Financial Executives Rises Slightly in Second Q u a rte r LONGMIRE EM A N D for executives in the fin a n c ia l-s e rv ic e s in d u s trie s rose slightly to 28% of th e national ex ecutive dem and in the second q u a rte r of 1982, according to K orn/F erry In ternational’s 42nd quarterly National Index of E xecu tiv e V acancies. This represen ts an increase of 1% from last q u arter and an increase of 2% over the same q u arter last year. “T he d em and for financial execu tives in both th e E ast and th e W est is significant,” said W indle B. P riem , m anagin g d ire c to r o f K o rn /F e rry s financial services division. “Financial executives in such areas as corporate fin a n c e , m e r g e r s /a c q u is itio n s an d bond trading — areas th at are incom e generating — are in hig h er dem and than, for exam ple, loan officers. T here is also a n eed for corporate financial executives who are able to assess a cor p o r a tio n ’s fin a n c ia l p o s itio n a n d spending and to guide it carefully in recessionary tim e s.” N a tio n a lly , c o rp o ra tio n s s o u g h t C EO s at record levels during 1982’s second q uarter. C E O s accounted for 16% of total executive dem and, double th e 8% of the year-ago quarter. “Boards are m oving aggressively to p ro tect co rp o rate assets and profits during this recessionary p eriod by re moving executives who are not p e r forming and seeking proved top m an a g e r s ,” r e p o r te d L e s te r B. K orn, chairm an, K orn/Ferry. H e said th at a high rate of tu rn o v er in th e top ranks of U. S. corporations can be expected to continue over th e next q u arter, w ith many executive posts rem aining u n filled. T he N ational Index of E xecutive Vacancies is based on a q u arterly su r vey of K orn /F erry ’s 750 clients, said to be am ong th e nation’s largest corpora tions and nonprofit organizations such as universities and g o vernm ent agen cies. G eneral m anagers con tin u ed to be the executives m ost in dem and during D BflMKMflTIC* 2 4 - H o u r A u to m a te d T eller M a c h in e N e tw o rk ! K a n sa s’ Fastest G r o w in g ! 54 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis th e second q u arter, w ith 27% of the total, up from 25% for the same q u ar te r last year. G eneral m anagers h istor ically com pose the largest category of ex ecutives h ire d each q u a rte r, b u t m ore are recru ited during recession ary periods than during expansionary tim es, according to Mr. Korn. Financial executives w ere in second place w ith 17% of dem and, down from 23% in last year’s second quarter. D em and for m arketing and for sales executives slid from 21% last year to 16% in this y e a r’s second q u arter. “This tre n d indicates that m ost firms today are protecting cu rren t share of m arket while holding back on expan sion of new -product introductions and geographical ex p an sio n ,” M r. Korn stated. The intensely com petitive financial services industry sought th e greatest n u m b e r o f e x e c u tiv e s d u rin g th e second q u arter w ith 28% of dem and. This group, w hich includes com m er cial banks, insurance firms and b ro k er age com panies, is aggressively hiring senior executives to direct expanded product and m arketing activities, Mr. Korn said. And international banks are recruiting A m erican m anagers to en large th eir U. S. business. The E ast increased its lead in execu tive hiring during th e second q u arter w ith 36% of dem and, up from 32%. The W est also gained, going from 30% to 35% . T h e S o u th w e st re m a in e d stable at 11%. The M idw est dropped slightly, from 18% to 15%, w hile the S outheast suffered th e g reatest d e cline, sliding from 9% to 3%. • • John J. Mallon, p resid en t, H astco Engineering/C onstruction C o., Inc., has b een elected to the board of A dm ire Bank, Em poria. Eldon L. Green has jo in ed Iuka State as v ice p re s id e n t/lo a n officer. H e form erly was loan officer/security offic er, Peoples Bank, Pratt. CNB Robert H. Longmire has joined Kan sas C ity ’s C o m m ercial N atio n al as m arketing director. M ost recently, he rep resen ted sales/prom otion areas for Oceans of Fun, w here he m oved after serving in the m arketing d ep artm en t of W orlds of Fun. H e is a lifelong resi den t of Johnson County. Duane A. Lankard has been nam ed co rre sp o n d e n t bank re p re se n ta tiv e/ agricultural and co rrespondent bank ing, M erchants National, Topeka. H e was graduated cum laude w ith a B.S. in agricultural econom ics from Kansas State U niversity in May. Fidelity State, Topeka, has elected tw o new assistant cashiers — Ju n e B lush an d P h y llis G arb isch . M rs. Blush is teller supervisor at the main bank and in charge of th e C D function th ere. M rs. G arbisch is supervisor/ item processing departm ent. ATM Transactions Highest A t College-Campus Sites Do college cam puses m ake good sites for ATMs? According to the p eo ple at M arine M idland Bank, N ew York, they do. O f the 28 busiest ATMs in th e bank’s 115 m achines statew ide, 15 are in or adjacent to private or state educational institutions. T he b an k ’s m ark et surveys show that many students n ever use checks, preferring to use ATMs for w ithdraw ing or depositing m oney and keeping track of th eir balances, says Paul E. Ruch, executive vice p resid en t in the bank’s national retail banking division. The bank recently recorded its first one-m illion-transaction m onth in its ATM network. COMMERCIAL NATIONAL BANK Mike O'Leary 6TH & MINNESOTA AVENUE KANSAS CITY, KANSAS 66101 Member F.D.I.C. 913 371-0035 MID-CONTINENT BANKER for August, 1982 RUNNING AHEAD OF SCHEDULE. g SAILING IN "UNCHARTERED'WATERS. Sì:.. i r i l i The Fourth IT TheFourth IT TOMORROW HAS ARRIVED. T he evidence is everywhere. But it’s m ost apparent with the new attitude of your custom ers, as they look for additional expertise and new dim ensions in financial services. And if you d o n ’t m eet the challenge, others will try. B ecause the rewards are great and deregulation has m ade it an open ballgam e with form idable com petition. Including savings and loans, stock brokers, credit unions, finance com panies and even national retail chains. W ithout question, everybody wants a piece of the action. But you still have a leg up, because research shows that cu sto m ers continue to place their greatest confidence in a bank. But to stay ah ead you m ust stay up. And one clear way to incorporate the required technology, innovations and program s into your operations is a strong correspondent relationship with yocir f u t u r e the biggest, strongest bank in Kansas. is AT All it takes to put The Fourth to THE FOURTH work for you is a call to J o e Stout, Tom Potter, Wayne Becker or Pam Rubin. And do it quickly. Before today turns into yesterday. THE FOURTH NATIONAL BANK AND TRUST CO. WICHITA, KANSAS 67201 / (316) 261-4441 MEMBER FDIC MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 55 , In Gulfport Miss. 15-S to ry S tru ctu re O p e n e d ; N e w H o m e fo r H a n c o c k Bank H E TA LLEST stru ctu re b etw een New O rleans and M obile, Ala., and the tallest coastline building b e tw een Port A rthur, Tex., and Tam pa, L la., was op en ed in G ulfport, M iss., recently as th e new hom e and h ead quarters of Hancock Bank. The $ 15-million, 15-story O ne H an cock Plaza is located in th e h eart of d o w n to w n G u lfp o rt an d h o u se s a ground-level shopping area, banking fa c ilitie s a n d o ffices th r o u g h th e seventh floor, w ith nonbanking office space on th e u p p e r floors. The top floor is reserved for a restau ran t and private dining club. The building is constructed on pil ings driven to a d ep th of 100 feet. It stands 206 feet above ground level and covers a gross area of 249,200 square feet. M ore than 12,000 cubic yards of concrete and 1,280 tons of reinforcing steel w ere used in the su p erstru ctu re. The building contains 1,103 windows. Mexican trav ertin e m arble was used for walls and floors on th e first, second, third and seventh floors. Indicot brick, Italian m arb le strips and b lu e-ch ip T m arble terrazzo w ere used in the firstfloor mall area. O ne H ancock Plaza’s m any design features include an abstract outline of th e M ississippi G ulf coastline from Hancock C ounty to Jackson County. T h e d esig n is c a rrie d th em a tic a lly from an outside courtyard through a ground-floor lobby area. The first piling for the stru ctu re was d riv e n in Ju n e, 1979. T o p p in g -o u t c e re m o n ie s w ere h e ld in O cto b er, 1980. The bank began moving into the new building last N ovem ber and by th e end of D ecem ber all d epartm ents had been relocated from the bank’s for m e r e ig h t-s to ry h o m e to th e new building. H ollow ing re c e n t d ed icatio n and ribbon-cutting cerem onies, the bank building was open for guided tours, refreshm ents, souvenirs and registra tion for alm ost $10,000 in cash and m erchandise prizes that w ere aw arded d uring th e open-house event. O p e n -h o u se activities in clu d ed a free carnival w ith rides for children adjacent to the bank property, a series 15-sto ry H an co ck P la z a is s a id to b e t a lle s t b u ild in g b e tw e e n N e w O r le a n s a n d M o b ile , A la . P a rk -lik e a r e a fe a t u r e s p ool, b e n ch e s. 4 0 0 - c a r g a r a g e a d jo in s b u ild in g . of musical events, an art exhibit and contest, em ployees’ tours of the b u ild ing, an em ployee reception and tours for stockholders. D uring th e open-house w eekend, cash draw ings w ere held every five m inutes and m erchandise prizes w ere aw arded periodically. M e rc h a n d ise p rizes in c lu d e d 20 popcorn m achines, eight personal TV/ radio com binations, four ceiling fans, four microwave ovens and two boats. Awarding of a grand prize of an all ex pense-paid trip for two to e ith e r Mexico or Las Vegas climaxed the fes tivities. • • TO P: T e lle r lin e a t H a n co ck B a n k in H a n cock P la z a fe a t u r e s a rc h e d w in d o w s , m a r b le fix tu re s a n d floo r. V ie w is from th ird floo r le v e l d o w n to se co n d -flo o r-le v e l lo b b y. BO TTO M : G ro u n d - le v e l sh o p p in g p la z a p ro v id e s a cc e ss to e s c a la to rs th a t le a d to b a n k in g floor on se co n d le v e l. 56 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 ^< Ç É > Æ' ¿ 6 «V ? https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Federal Sign proudly presents its C R E D E N T IA L S The SELECTION OF THE RIGHT SIGN SUPPLIER is critical to— • Increase Customer Traffic. • Project Your Best Image. • Assure Enduring Quality. Federal Sign has the largest resources and ca p ab ilitie s to satisfy full signage needs. W hether fo r one location, a regional or national program. 0 ', RESPONSIBILITY: The nation’s premier sign company since 1901. 0 * , MOST FACILITIES: E " , FAMILIARITY WITH YOUR NEEDS: With its tens of thousands of successful signage programs, chances are Federal Sign has met challenges similar to yours and has the experience to find the best solution. Twelve strategically located manufactur ing, sales and service locations. 0 " , FULL LINE ELECTRONIC DISPLAY LINE: 0 " , LARGEST NUMBER OF SIGN PROFESSIONALS: Over 500 employees. BEST EQUIPPED: The industry’s largest fleet of companyowned service and installation vehicles. 0 * SUPERIOR DESIGN CAPABILITIES: Large design staff to interpret your needs and desires. Federal Sign produces and services its own fine line of electronic message sys tems and time and temperature displays. 0 * . IN-HOUSE LEASING PROGRAM: with its many benefits. For a free identification “ idea booklet,” write: Federal Sign 140 E. Tower Drive Burr Ridge, Illinois 60521 Or call Toll Free: 800-323-7431 PROFESSIONAL PLANNING: Comprehensive site survey as only Federal Sign can do it, with complete engineering and marketing criteria. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis FEDERAL SIGN Division Federal Signal Corporation Increase Is Noted In Placement of Grads O f Banking Institute ST. LO U IS — Fifty-tw o graduates of the In stitu te of B anking/Financial M arkets at th e B usiness School of W a s h in g to n U n iv e r s ity h e r e h a d accepted positions w ith 25 different financial institutions as of Ju n e 15. So reports Jess B. Yawitz, d irecto r of the institute. This figure, he says, com pares w ith 33 students last year. Am ong MBAs, 43% of the graduates jo in ed financial institutions. The com parable figure for undergradu ates is 48%. “W hile we have ex p erienced a large increase in total n u m b e r of students selecting financial in stitu tio n s,” P ro fessor Yawitz continues, “the fourfold increase in the u n d erg rad u ate area is particularly encouraging. According to Professor Yawitz, 41 financial institu tio n s in terv iew ed on cam pus this year. This was an increase of six over last year. H e points out that h e ’s quite p roud of th e diversity re p re sented by this group in term s of size, geography and type of institution. “ W e re q u ite p le a s e d w ith o u r p lacem en t e x p erien ce this year. In light of the fact th at we re now re c ru it ing a significant n u m b e r of students into the Business School because of the financial-institutions program , I have no doubt this strong placem en t record will co n tin u e.” The institu te was started in 1980, w ith 15 m ajor banking and financial institutions as sponsors. M ore have b e com e sponsors since then. T he insti tu te has a threefold purpose: 1. To strengthen ties b etw een W ashington U niversity and key banking and finan cial institutions across th e country. 2. To facilitate efforts by financial in stitu tions to attract first-rate graduates of W ashington U niversity and encourage and support research by th e Business School faculty. 3. To plan and prom ote periodic sem inars for p ractitioners in the broad areas of banking and finance. Bank's Letter of C redit Flelps In H istoric H otel Renovation O M M E R C IA L BANKS can play a pivotal role in financing urbanrevitalization projects by helping to secure tax-exem pt bond issues through issuance of letters of credit. So says A m erican D evelop m ent C orp., a Los A ngeles-based real estate developm ent firm. C W ith collateral provided by a bank’s le tte r of credit, Am erican D e velopm ent recently facilitated issuance of tax-free short-term revenue bonds through th e city of Springfield, 111., to provide approxim ately $4.9 m illion in construction financing for renovation of the historic St. Nicholas H otel. In th e renovation, th e 189-room hotel will be transform ed into a m ixed-use com plex of 94 rental apartm ents and m ore than 15,000 square feet of retail/office space. T he project is being done as part of an extensive d ow ntow n-redevelopm ent project in Springfield. New Faculty Appointment ST. L O U IS — D r. N ic h o la s D opuch of th e U niversity of Chicago will join the accounting faculty at W ash in g to n U n iv ersity ’s B usiness School beginning w ith th e 1983-84 school year. D u rin g 1982-83, he will co ntinue as a full-tim e faculty m em b er at th e U niversity of Chicago. H ow ever, as he has done in th re e of th e past four years, he again will d irect a series of research sem inars in accounting for W ashington U niversity. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis St. N ic h o la s H o tel, S p rin g fie ld , III., is b e in g re n o v a te d in t o a p a r t m e n t b u i l d i n g w it h r e t a il/ o f f ic e s p a c e th ro u g h p ro g ra m in v o lv in g issu a n c e of le tte r of cred it by bank. The nam e of th e bank involved in th e project has not been m ade public. “By providing collateral to help finance m ultifam ily-housing p ro je c ts,” says T. M ichael W iley, senior vice president/regional m anager, A m erican D evelopm ent C orp., “financial institutions have the oppor tunity to participate in a new way in the real-estate arena and serve as catalysts in exciting urb an -red ev elo p m en t pro jects.” As is being done in Springfield, he points out, com m ercial banks can help secure tax-exem pt bond issues by issuing letters of credit. W hile a local bank’s le tte r of credit w ould not suffice in obtaining a rating if the bank was not of sufficient size, says Mr. W iley, its “u n d e r w riting” of the project w ould allow a rated bank to “w rap” the local bank’s le tte r of credit w ith its own, thus obtaining the rating. Banks in m ajor m oney-m arket centers, like N ew York C ity and Chicago, he w ent on, are looking for the en d o rsem en t of th e local financial com m unity in m ost cases before agreeing to participate. W hen a bond issue is sold through a bank or investm ent banker, its proceeds then are escrow ed w ith th e tru stee for disbursem ent during construction. “This cooperative and creative approach involving the financial com m unity creates a viable, exciting developm ent, the effects of which may create a positive influence for years to co m e,” Mr. W iley points out. “W hen rehabilitation is involved, th e concept becom es even m ore beneficial as it results in preservation of architecturally and historically significant stru c tu re s.” 59 Quality. \bur key to success. When it comes to investments— long-term or short-term— you deserve the best. And you can get it. From a bank that stresses quality first. There really is such a place, you know. United Missouri Bank. Our Bond Department is in the business of offering high quality portfolio investments. You get the benefit of our years of ( j[i ' experience. And our outstanding track record for providing sound bond portfolio recommendations. Since the 1920’s, we’ve been here for you. And you know we’ll be around tomorrow. Adapting to a changing financial world. With consistently high standards. Call or write United Missouri Bank today. Because when success is your goal, there’s just no substitute B ond D e p a rtm e n t UNITED MISSOURI BANK of Kansas City, n.a. Member FDIC United we grow.Together. 10th and Grand, P.O. Box 226, Kansas City, Missouri 64141 • (816) 556-7200 60 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 No Regionais for Missouri Bankers; 'Fall Festivals' Planned Instead H E R E w o n ’t b e an y re g io n a l m e e tin g s in M isso u ri th is fall! H ow ever, th e re will be eight “fall fes tivals,” a nam e th e M issouri Bankers Sept. Association has given to w hat used to be the regionals. Sept. In registration m aterial sent out by the MBA, th e association describes th e Sept. revam ped series of m eetings in this way: Sept. “All the ex citem ent of a b rand-new p ro g ram to re p la c e M BA reg io n al m eetings . . . cocktail reception, free b eer, picnic fare and th e m ost extraor dinary e n te rta in m e n t program of its Sept. kind in th e world. Sept. D espite th e renam ing of th e region als, th ere will be a serious side in th e Sept. form of business m eetings in th e after noon preced in g each festival. D uring Sept. these m eetings, th e re will be a legisla tive session, d uring w hich a re p o rt will b e given on a study by two U niversity of M issouri/C olum bia staff m em bers T First Week 13 — Region 4 — Kansas City 14 — Region 3 — St. Joseph 15 — Region 2 — Chillicothe 16 — Region 1 — Kirks ville Second Week 20 — Region 7 — Springfield 21 — Region 6 — Sikeston 22 — Region 5 — St. Louis 23 — Region 8 — Jefferson City on how usury laws affect banking both from the standpoint of banks and con sum ers. The study has b een m ade by Drs. W alter Johnson and Adam G ehr. In addition, new regional officers will be elected d u ring the business m eetings. T he highlight of th e en tertain m en t will be concerts by Up W ith People, an energetic cast of musical perform ers who have sung before millions in m ore than 42 countries. T he cast provides uplifting family e n tertain m en t by p re senting a m edley of hit tunes, in tern a tional folk songs and original music. The 1982 edition of Up W ith People w ill f e a tu r e m u sic o f th e ’60s — M otown, surf music, hootennany and the Beatles — as well as favorites from th e “Roaring ’20s.” Up W ith People is a nonprofit e d u cational organization m ade up of stu dents from all over the w orld, ranging in age from 17 to 25. All races, religions % OFFICERS SouthSide National J. RICHARD FURRER President i? Chairm an o f the Board RICHARD J. TIEMEYER Executive Vice President WALTER C. HAMMERMEISTER Senior Vice President i? Cashier South Side National Bank 3606 Gravois Avenue St. Louis, Missouri 63116 314 776-7000 W ILLIAM E. MUHLKE Senior Vice President &■ A u d ito r Statement of C ondition, June 30, 1982 ALBIN F. OEHLER Vice President FRED BRINKOP, JR. Vice President RAYM O ND KNORPP Vice President LEON A. BREUNIG Vice President — Com mercial Loan O fficer ARTHUR L. JE A N N E T, JR. Vice President ir Personnel D irector CORT L. BICK T rust Officer WALTER E. GOEBEL A ssistant Vice President ALYCE L. SCOTT Assistant Vice President JOSEPH E. MAGER Personal Loan O fficer ¿r Assistant Vice President JAMES R. KOEHLER Personal Loan O fficer ir A ssistant Vice President G EO R G IA L. K IN G Personal Loan O fficer S ANDRA A. REMES Secretary to the Board MARl'LYN R. SAX Public A ffairs O fficer BERNICE M. M ANZER Safe Deposit O fficer DIRECTORS JOSEPH W . BEETZ WALTER E. COLLINS RALPH CRANCER, JR. HO W AR D F. ETLING CYRIL J. FURRER, JR. J. RICHARD FURRER JAMES E. GODFREY THO M AS J. HEJLEK CHARLES F. HERWIG EARLE J. KENNEDY, JR. RICHARD J. TIEMEYER EDWARD G . ZEISLER RESOURCES Cash and Due from B a n k s ................................................................$ U.S. G ovt. O bligations, Direct and G u a ra n te e d ...................... U.S. Agency B o n d s ............................................................................ Federal Reserve Bank Stock ........................................................... O bligations of State and Political Subdivisions ......................... Federal Funds Sold ............................................................................ Lo an s-G ro ss...................................................... 9 7 ,8 8 8 ,7 0 2 .8 9 Less Unearned D is c o u n t................................ 3 ,7 9 2 ,3 1 4 .7 9 Less Allowance fo r Possible Loan Losses 5 2 3 ,6 8 3 .6 0 Loans — N et ...................................................................................... Banking House and Parking Lot .................................................... Furniture, Fixtures and Safe Deposit V a u lt s ................................ O ther Resources ................................................................................. 8, 1 3 7,32 1.42 11, 0 1 8 ,4 5 8 .2 3 15, 2 2 4 ,5 3 5 .1 6 1 0 5 .0 0 0 . 00 10, 0 8 7 ,2 7 1 .3 4 1 / 5 0 0 .0 0 0 . 00 93, 5 7 2 .7 0 4 .5 0 2, 387.78 9.51 2 9 2 ,2 9 3 .3 2 2, 8 9 8 ,7 2 4 .4 5 $145 2 2 4 ,0 9 7 .9 3 LIABILITIES C apital .................................................................................................. $ 1, 200, 000.00 Surplus .................................................................................................. 2, 3 0 0 ,0 0 0 .0 0 Undivided P r o f it s ................................................................................. 6, 3 6 0 ,9 9 6 .0 9 Reserve fo r Taxes, Interest, etc......................................................... 2, 2 1 0 ,8 0 8 .0 6 Deposits ................................................................................................ 126, 2 0 5 ,5 2 7 .0 0 Demand D e p o s its .......................................... 2 0 ,0 9 2 ,7 8 3 .6 0 Time Deposits ............................................... 1 0 6 ,1 1 2 ,7 4 3 .4 0 Securities Sold Under Agreem ent to R e p u rc h a s e ...................... 3 9 0 8 ,8 6 5 .5 7 O ther L ia b ilitie s .................................................................................... 3, 03 7,90 1.21 Member Federal Deposit Insurance Corporation $145 2 2 4 ,0 9 7 .9 3 J MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 61 Up W ith P eo p le , m u sic a l p e rfo rm e rs, w ill be h ig h lig h t of " f a ll f e s t iv a ls " to be he ld in ste a d of re g io n a ls b y M is souri B a n k e rs A s so c ia tio n . G ro u p of y o u n g p eo p le w ill e n t e r ta in e a c h M B A reg io n n ex t m o n th . G ro u p is p ictu red a t G r e a t W a ll of C h in a . and econom ic backgrounds are re p re sented. They spend 11 m onths trav el ing all over th e w orld — an average of 35,000 miles. The original group was m M ISSO U R I'S BUSINESS DEVELOPMENT IS OUR BUSINESS by providing a source of credit not otherwise available to Mis souri industry. ★ ★ ★ ★ ★ ★ New Projects Expansion Operating Capital Counseling Participations Small Business Loans founded 12 years ago. A sid e from e n te r ta in m e n t (at 8 p.m .) by Up W ith People, each MBA fall festival will feature a cocktail re ception at 6 p.m . and d in n er at 7 p.m . The following bankers have served as MBA regional officers during the past year: Region One — D ale E. Van Huss, who e n te red banking in 1962 at Paris National and w ent to Bank of Lancas te r in 1976 as president. H e becam e p resident/chairm an/C E O in 1979. Region Two — Bob Stinson, a bank e r since 1964, w hen he joined Peoples Bank, M ercer. H e becam e assistant vice p resid en t in 1966 and executive vice presid en t in 1969. Region Three — John E. Karn, who was elected chairm an last spring of F irst Stock Yards Bank, St. Joseph, w hich he joined in 1960. H e becam e vice president/cashier in 1970, execu tive vice presid en t in 1975 and p resi d e n t in 1978. Region F o u r — G ene E. Irvin, who joined Adrian Bank in 1960, becam e assistant cashier in 1964 and chairm an/ p resid en t in 1975. Region Five — G len M. Kayser, Regional Vice Presidents Can we work together to benefit your community? For more information, contact: Jerry Stegall, Exec. Vice Pres. Phone — A C 314-635-0138 LASLEY SWINDLE IRVIN STINSON FIRST M ISSO URI DEVELOPMENT FINANCE CORPORATION 1411 Southwest Blvd. Suite B P.O. Drawer 1745 Jefferson C ity, Missouri 65102 62 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for August, 1982 w ho e n te re d banking in 1963 at F irst N ational (now C e n te rre Bank), St. L o u is. H e jo in e d C e n t e r r e B ank (formerly C itizens Bank), Pacific, in 1979 as president. Region Six — Larry D. Swindle, a b an k er since 1966, w hen he jo in ed National Bank of C om m erce, M em phis. H e w ent to Bank of K ennett (now C en terre Bank, K ennett) in 1968 as assistant vice president. H e was ad vanced to executive vice p resid en t in 1980. Region Seven — K. Adrian Lasley, who en tere d banking in 1954 at State Bank, Willow Springs, now M ercan tile Bank, W illow Springs. From 195967, he was w ith Farm ers State, Schell City; from 1967-68, F irst National, St. R o b e rt, a n d fro m 1968-71, F ir s t National, M alden. In 1971, Mr. Lasley rejoined the W illow Springs bank as c a sh ie r, b e c a m e vice p re s id e n t in 1972, executive vice p resid en t in 1975 and presid en t in 1978. Region E ig h t— Ruby M. H am lett, w hose first post was bookkeeper w hen she en tered banking in 1964 at Laddonia State. She advanced to assistant cash ier in 1974 and p re sid e n t/c h ie f operating officer in 1981. • • Two St. Louis banks — A m erican National and City Bank — are affiliat ing with the Kansas C ity-based m u lti b a n k H C , F ir s t N a tio n a l C h a r te r C o r p ., w h o se s h a r e h o ld e r s h a v e approved a nam e change to C harterC orp. The banks will form a base in St. Louis for th e H C , which curren tly has 24 affiliates across M issouri, including four in St. Louis C ounty. Gayle W. L ichtenstein continues as chairm an of A m erican N ational and C ity Bank, w hich will have no change in officers or directors. John L. W hite is president, A m erican National; N orm an J. Tice is p resident, City Bank. We support the Missouri Bankers Association and its regional meetings next month. W e’ll be attend ing our regional. Will you be at yours? Now, more than ever, is the time to use the tools made available to bankers by the MBA — tools such as the Com pliance Library. These tools help bankers keep abreast of the ever-changing regula tions affecting the industry! ...getting bigger to serve better Mini-Bank 9229 Natural Bridge Main Bank 8924 St. Charles Rd U nited M issouri, Kansas C ity, has announced these prom otions: to vice p re s id e n t/c o rp o ra te serv ices, G ary Foltz; to vice president/business d e velopm ent, P e te r N. Gabrovsky; to assistan t vice p re sid e n t/g e n e ral ad m inistration, R obert Stark; to assistant v ic e p r e s id e n t/b a n k c a r d d iv isio n , Thomas G. Atkins, and to assistant vice president/cash m anagem ent and book keeping division, co rrespondent b ank ing, W. Maxine Hahs. M erca n tile T ru st, St. L o u is, has p ro m o ted th e following to assistant vice presidents: Karl W. Ashm an, Alan L. P re sse y , M ic h e le M o ran Self, Jam es U. W rig h t, C h a rlo tte R eitz K rueger, Joan L. Machlis and M ary Sue McSwain. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis j*l__ Mini-Bank 3580 Woodson Rd. BANK & TRUST COMPANY T h e S o lid P la c e to B a n k 428-1000 8924 St. Charles Rd. • St. Louis, MO 63114 9229 Natural Bridge • St. Louis, MO 63134 3580 Woodson Road • St. Louis, mo 63114 63 First National Charter Corp., Kansas City, is changing its nam e to C harterCorp. In addition to approving this move, the H C ’s shareholders au th o rized the corporation to issue up to 1,000,000 shares of p referred stock, app ro v ed an in cen tiv e stock-option plan for key em ployees and ratified selection of A rthur Young & Co. as in d e p e n d e n t public accountants for C harterC orp. They also elected two new directors, M ichael G. F itt, C E O , E R C M a n a g e m e n t C o r p ., K ansas City, and W illiam A. Hall, assistant to th e presid en t, H allm ark Cards, Inc., Kansas City. Tw o St. L o u is -a re a b a n k s h a v e changed th eir nam es — C itizens Bank, U niversity City, to Royal Rank M idC ounty and W est Side National, G len dale, to Royal Bank W est Side N. A. The nam e changes w ere m ade to coor dinate efforts of both banks u n d er the sam e m u lti-b a n k -H C o w n e rs h ip , Royal Bancshares, Inc. Robert L. M atteson has joined F irst National, St. Charles, as vice presid e n t/cash ier. H e form erly was vice p resid en t/operating officer, Jefferson Rank, St. Louis. Municipal Bonds ( I x c iliS iv c lil Specializing in GENERAL MARKET BONDS Revenue a n d G eneral O bligation Your "Correspondent” for Municipal Bonds Investment Bankers • Municipal Bonds ONE TWENTY SEVEN WEST TENTH KANSAS CITY, MISSOURI 64105 (816) 221-4311 64 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Robert G. Becker has b een nam ed c h a irm a n /C E O , W oods M ill F o rty Bank, C hesterfield. T he bank is an affiliate of the m ulti-bank H C , Santa Ana Bancorp., based in St. Ann. Mr. Becker, who has been on the board of W oods Mill F orty Bank, previously had b een p resid en t, C en tu ry Baneshares and N orth St. Louis Trust. Suzanne E. D otson has b e e n p ro m oted to vice president/com m ercial lending, C en terre Bank, Kansas City. She joined the bank five years ago. Paul E. Rigby has advanced from assis tant vice presid en t to vice president, C e n te rre Bank, St. Louis. E le c te d assistant vice presidents w ere P en el ope A. Bogacki, form erly retail bank ing officer; D orthy M. Feigl, form erly in v e s tm e n t o p eratio n s officer, and Richard C. M essey, form erly bond in vestm ent officer. D ennis J. Sullivan has joined C en terre Bank as vice presi dent. H e form erly was staff vice p resi d e n t, C iticorp, N ew York City. In o th er news at C en terre Bank, W illiam K. Jones, vice p resid en t/in v estm en t banking, has been nam ed president, M idw est C hapter, Foreign Exchange T raders Association. Jonathan Kemper has joined Kansas C ity’s C om m erce Bank as vice president/m etropolitan division, com m er cial banking departm ent. F o r th e past th re e years, Mr. K em per has been a com m ercial banking officer at C iticorp (U. S. A.) in Chicago. H e m anaged accounts of m ajor national and m ulti n atio n al c o rp o ratio n s b ased in th e n orth central U. S. Boatm en’s N ational, St. Louis, has announced these appointm ents: Cal vin C. Cole was elected vice p resid en t in charge of corporate trust; Louis F. H erm ann was prom oted to assistant vice p re sid en t/cred it adm inistration; M au rice S. C h a n d le y was e le c te d a ssistan t vice p re sid e n t/o p e ra tio n s; Jeffrey A. H oltz was nam ed assistant tru st officer, and E arl J. W ard was m ade assistant cashier/retail banking. T h e b a n k ’s p a re n t H C , B o a tm e n ’s Bancshares, has a new director, T hom as P. Reidy, president. Thos. P. Reidy, Inc., H ouston. MID-CONTINENT BANKER for August, 1982 Belle-Bland Bank Closes Now. First National Bank h a sa new source of funds available for cattle and grain loans. BLA N D — D eposit liabilities of Belle-B land Bank, w hich was closed July 2, have b een assum ed by Eagle Bank of G asconade C ounty, a new ly ch artered hank. T he single office of th e closed bank re o p en ed July 6 as Eagle Bank of G asconade C ounty, and all depositors of th e closed bank autom atically becam e depositors of the assum ing bank. B elle-Bland Bank was closed by M issouri C om m issioner of F inance K e n n e th W . L ittle fie ld , an d th e F D IC was nam ed receiver. A ccord ing to Mr. L ittlefield, heavy loan losses re n d e re d th e bank insolvent. C om m 'l M arketing W orkshop Set by BMA fo r St. Louis How to build profits by m arketing to th e com m ercial sector will be the focus of th e 1982 co m m ercial m ark etin g w orkshop for com m unity bankers to be held S eptem b er 12-14 at th e Sheraton St. Louis H otel by the Bank M arketing Association. T he w orkshop will include 10 hours of working and idea-exchange sessions on such topics as officer-call program s, sales com pensation, sales tools and lo an p r o d u c ts . E m p h a s is w ill b e placed on specific m arketing m ethods rath er than theory. K ey n o ter will be Je rry S. W ayt, p r e s id e n t, C itiz e n s B a n k in g C o ., A nderson, In d ., wiio will speak on the im p o rta n c e of d e v elo p in g b u sin ess accounts in a com m unity bank, focus ing on th e areas of re sp o n sib ility , adm inistration, m easurem ent and lead generation in a com m ercial m arketing pro g ram . Also on th e program will be Larry Lanie, presid en t, G uaranty National, Tulsa, w hose subject will be "M oneyM a rk e t F u n d s /R e p u rc h a s e A g re e m e n ts,” and Bruce Alexander, assis tan t vice president/com m ercial len d ing officer, F irst National, B oulder, C o lo ., whose topic wall be “Loan P rod u c ts.” The best way to m anage th e rela tionship b etw een a com m unity bank and its m ajor co rrespondent will be analyzed by C harles R. Lefler, chair man, Lefler In v estm en t C o., Lincoln, N eb., and a th ree-h o u r sales-training clinic will be conducted that will be stru ctu red around an interactive for mat. FIRST AGCORP. m agricultural credit corporation that is a wholly owned, non-banking sub sidiary of First Midwest Bancorp., Inc. First Agcorp is another of the many correspondent services available through the First National Bank of St. Joseph. Just call John Kam, K £ ? or Where your success is a tradition. First National Bank St. Jo se p h , M is s o u ri 64502 C all: (816) 279-2721 A ffilia te of First M idw est Bancorp., Inc. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis M em ber F.D.I.C. 65 National, State Banking Leaders O n Tap for Kentucky Convention o f th e Convention Speakers n a tio n a l a n d s ta te b a n k in g scenes will p re se n t th e ir views at the 88th annual K entucky Bankers Asso ciation convention S ep tem b er 12-14 at Louisville’s G alt H ouse. P resen tin g th e national view point will be K entucky’s own W illiam M. Issac, F D IC chairm an; and W illiam H. K enn ed y Jr., ABA p re sid e n t-e le c t, and chairm an, N ational Bank of C om m erce, Pine Bluff, Ark. P resenting th e state view point will b e H arold Rogers, R epublican con KENNEDY ISSAC SMITH GERSTNER g ressm an re p r e s e n tin g K e n tu c k y ’s fifth district; and M orris R. Sm ith, to K e n tu c k y b a n k e rs on S u n d ay , S. Hanks, p resid en t, A nderson N a com m issioner, D ep a rtm e n t of Bank S ep tem b er 12. Registration will begin tional, L aw renceburg. ing and Securities, Frankfort. at 1 p.m . in th e third-floor lobby of the P hilip M orris co m m unity service A dding a c o m p e tito r’s v iew p o in t Galt H ouse. That evening, th e KBA awards will be p resen ted at th e annual will be Louis V. G e rstn e r Jr., vice w ill p r e s e n t its a n n u a l re c e p tio n , K entucky L u n ch eo n , follow ing th e ch a irm a n , A m erican E x p re ss C o ., w hich will be followed by a nitecap general session. New York City. party. The concurrent workshops, lasting A new feature at this year’s conven The first general session will begin about 90 m inutes each, will constitute tion will be two co n cu rren t w orkshops, at 9 a. m. on M onday, S ep tem b er 13. th e M onday afternoon program . one on m ini com puters and th e oth er S p e a k e rs at th a t s e ssio n w ill b e M onday evening’s activities will in on asset/liability m anagem ent. M essrs. Issac, Rogers and K ennedy. clude the 50-Year C lub and past presi The convention will open its doors Presiding will be KBA P resident Allan d e n ts ’ d in n ers, follow ed by an all convention dance. T uesday’s activities will begin w ith th e traditional country ham breakfast, follow ed by a p ro g ram of re m e m brance at 9:30, to be followed by the Presiding at the 88th annual conven chairm an/president, F arm ers D eposit s e c o n d g e n e ra l se ssio n at 10:15. tion of th e K entucky Bankers Associa Bank, E m inence. Mr. K eiser en tered Speakers at this session will include tio n in L ouisville w ill be Allan S. banking in 1954 as cashier at his p re s M essrs. G erstn er and Smith. C onven Hanks, 1981-82 KBA president, and e n t bank. H e has b een chairm an/presi tion reports also will be p resen ted and p resid e n t, A nderson National, Law d e n t since 1981. Kentucky m em bers of th e ABA will renceburg. Mr. H anks e n te re d bank m eet to elect a new m em ber to the KBA treasu rer for the past year has ing in 1948 at A nderson National. His b e e n B erks B row n, ex ecu tiv e vice governing council. first o fficer p o sitio n was a s s is ta n t p resid en t/cashier, S outhern D eposit A p re -b a n q u e t re c e p tio n will be cashier, w hich he attained in 1953. H e Bank, Russellville. Mr. Brown becam e held from 5:15 to 6:45 Tuesday ev en has been p resid en t of th e bank since a banker in 1965 at his p resen t bank. ing, to be followed by th e annual b an 1971. q u e t at 7 p.m . New officers will be H e sta rte d as assistant cashier, ad Serving as KBA p resid en t-elect for vanced to cashier in 1967, vice p resi in stalled . B an q u et sp eak er will be th e past year has been F. C. Keiser, d ent/cashier in 1968 and assum ed his G rady N utt, hum orist from the “H eeH aw ’ TV show. Mr. N utt now calls p re se n t title in 1974. K entucky his hom e. • • R e p r e s e n t a t iv e s Hanks to Preside at KBA Convention HANKS 66 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis BROWN KEISER C itiz e n s F id e lity , L o u isv ille , has prom oted E. Joseph H ughes from vice p re sid e n t to sen io r vice p re sid e n t/ corporate tru st and G ranville R. Beam and John P. Stengel from assistant vice presidents to vice presidents/inform ation services. E dw ard C. Sherm an Jr. has joined the bank as assistant vice president/inform ation services. MID-CONTINENT BANKER for August, 1982 B ank-S tru ctu re D isp u te Lingers in K entucky If such a breach occurs, the PBA will H E FA TE of a unified K entucky Bankers Association hangs in th e hire an executive director and the asso will expand into a full-service balance as the annual convention of thciation e tr a d e o rg a n iz a tio n , a c c o rd in g to banking trade group approaches. For the past few m onths, bankers H e rb e rt Sm ith, p resident, Am erican who support th e Progressive Bankers National, Bowling G reen, who serves Association (PBA) have given signals as PBA chairm an. Should th e re be a split, it’s expected that they will leave th e KBA if reform s are not in stitu te d before this year’s th a t so m e b a n k s w ill h o ld m e m a n n u a l m e e tin g . T h e re fo rm s r e berships in both associations, a posi quested by th e “rival’ trad e group in tion that Mr. B rum ley term s “costly.” H e says a basis for agreem ent was clude a unified position to work for m ultibank legislation in th e K entucky legislature and a change in th e KBA’s one-bank, one-vote rule. T he Progressive Bankers Associa tion is a formal association w ith a m em bership of 70 banks rep resen tin g about 75% of all deposits in K entucky banks. I t m a in ta in s a lo b b y is ts office in Frankfort, but, at this tim e, does not have a formal staff. P resid en t of th e PBA is Thom as R. Brum ley, chairm an/ and Planning president, F irst State, G reenville. M ore than one m eeting has been A B a n k Director's Manual h eld this su m m er b etw een th e two associations an d , acco rd in g to M r. Brum ley, the m eetings have resu lted in a “very positive” attitu d e. H e says PBA m em bers are in ag reem en t that it’s in the best in terest of th e banking industry in K entucky for bankers to be unified in one association; how ever, if a g r e e m e n t a b o u t th e tw o b a sic changes PBA m em bers call for is not 248 p g s. $2750 reached by convention tim e, th e re is a real possibility th at PBA m em bers will Every bank m ust know W H E R E w ithdraw from th e KBA and pursue it is going and HOW to get there! th eir aims u n d e r th e u m brella of the W hile m anagem ent should “ map PBA. T Budge*10?’ Forecasting the co urse,” directors should play a role in e s ta b lis h in g and im plem enting goals. This manual supplies directors with tools they need in order to steer bank policy in the best direc tion. Chapters discuss establishm ent-of-m ission sta te m e nts and goals, trace various stages of a p lanning process. A lso o utline s many external and internal factors that m ust be considered. Details Bank Security Seminar Scheduled O ct. 13-15 C L E V E L A N D — B a n k e rs w ho atten d the ABA’s bank security sem i n ar O c to b e r 13-15 at th e S heraton Hopkins A irport H otel h ere will be given a practical w orking know ledge of security-m anagem ent p rin cip les. Sem inar sessions will be focused on id en tify in g and co m b atin g areas of security exposure; planning security procedures to increase controls over robbery, check sw indles, em b ezzle m ent and o th er acts of em ployee in fidelity; crisis-m anagem ent-planning tech n iq u es for dealing w ith kidnap p in g , e x to rtio n and b o m b th re a ts ; security devices, insurance coverage and preparing a w ritten security p ro gram and planning security in new construction, selling security to m an agem ent and investigations and in te r rogation. NEW! Just Off The Press • For Management • For D irectors By Dr. Lewis E. Davids . . . A budgeting and plan ning manual to aid in giving direction to YOUR bank. H O W to perform fin an cia l p la n ning, HOW to plan for new ser vices. Explains boa rd ’s role in eco n o m ic fo re c a s tin g . D is c u s s e s basic approaches to gather and best ways to utilize data in form al planning. Form s and w orksheets are in cluded covering a vast array of planning aspects. Techniques uti lized by successful banks are in cluded; sources of inform ation are listed, along with a bibliography of references. Save! Send check with order. THE BANK BOARD LETTER 408 O live St., St. Louis, MO 63102 1 Copy @ $27.50 _________5 or more @ $24.00 ea: Budgeting, Forecasting and Planning N a m e .............. Bank S tr e e t.............. I City, State, Zip I Title .............. J MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis v achieved at the m ost recen t m eeting b etw een rep resen tativ es of th e two associations. Each group will be re porting to its association’s board on Au gust 6. At that tim e, it’s expected the PBA board will m ake a recom m enda tion as to w h eth er or not the basis for agreem ent is sufficient to avoid a split. The PBA was form ed last O ctober over the bank stru ctu re dispute. The w hole issue is one of “big banks versus small banks,” Mr. Sm ith says. I I 67 N ew s A b o u t B a n k s a n d B a n k e rs Alabama Mary G eorge Jordan W aite, ehairm an/president, F arm ers & M erchants Bank, C en tre, was honored recently for h e r 25 years of service to G irls’ State. Alabama G irls’ State, held on the cam pus of H u ntingdon College in M o n tg o m e ry , s p o tlig h te d M rs. W aite’s service at th e opening session, and the program for th e w eek was d e d icated to her. She was given a G irls’ State pin by Kay Ivey, G irls’ State director, and she received an orchid corsage from D r. Allen Jackson, H u n t ingdon College president. D uring the past 25 years, Mrs. W aite has b een counselor, d irecto r or chairm an. In addition, h e r two d aughters, B etty and D iane, w ere delegates to G irls’ State and also w ere selected to atten d G irls’ Nation. G irls’ State is sponsored by the A m erican Legion Auxiliary, and d ele gates live in a m ythical city, county and state w hile they learn about govern m ent. Ruth R ichardson Brock has b e e n nam ed to the advisory board of F arm ers & M erchants Bank, C en tre. She is a re tire d teacher. H e r grandfather, J. K. Richardson, was one of the bank’s organizers and its first president. H er parents, Mr. and Mrs. Mack R ichard son, w ere two of th e original stock holders, and Mrs. Brock and h e r hu s band, Dickson, also own stock in the bank. In o th er action, L u th er C h esnut has been nam ed m anager/loan officer at C edar Bluff Branch of F arm ers & M erchants Bank. H e was w ith C edar Bluff Bank many years. nam ed head of the com m ercial bank ing group. H e form erly m anaged the m ortgage banking division. Mr. Beard has been w ith th e bank since 1977. Young Bankers' Award John F. Beard Jr., senior vice p resi d ent, F irst National, M obile, has been Mary George Jordan Waite (I.), ch./pres., Farmers & Merchants Bank, Centre, pre sents the President's Award to Theresa Far rar, one of four school coordinators in Group Three of the Alabama Young Bank ers to win the award. The latter is given to school coordinators who have shown sub stantial increase from the prior year in number of contacts made with schools. The Alabama Young Bankers sponsor the eco nomic education program in elementary, middle and high schools and colleges. Mrs. Farrar has been school coordinator with her bank for two years, and last year she was chosen "Outstanding School Coordinator" for Group Three. Arkansas J. C. Vaughn Jr. has b een elected president, F irst Bank, Jonesboro. H e form erly was p resid en t, F irst N ation al, Paragould. H e is a graduate of the School of Banking of the South. Call Delmar Epton, Data Processing Officer; First Alabama Bank of Montgomery. For your correspondent needs, 2 0 5 / 8 3 2 - 8 4 6 5 . Personal Banking From Professionals. R rs t A la b a m a Bank / 68 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis of Montgomery na *MemberfDIC John W omack, assistant vice p resi dent, City National, F o rt Sm ith, has been elected p resid en t of the Young Bankers Section of the Arkansas Bank ers Association. New vice p resid en t is W illiam C. W isen er, assistant vice president, W arren Bank; secretary is H o lly E d d in s , a s s is ta n t c a s h ie r, W o rth e n B ank, L ittle R ock; an d tre a su re r is N eala W ilson, assistant vice president, F irst N ational Bank of Phillips C ounty, H elena. MID-CONTINENT BANKER for August, 1982 Ark.BA Staffer Appointed N a n c y N e ig h b o rs h a s b e e n appointed assistant d irec to r of th e Arkansas Bankers Association. She assists E xecutive D irecto r Bo C ur vili, coordinates th e Young B anker S ection and a d m in iste rs th e four banking schools sponsored by the Ark. BA. She also is in charge of office m a n a g e m e n t a n d a d m in is tr a te s several co m m ittees. She form erly was w ith C om m ercial N ational, L it tle Rock. Harris Trust, Chicago, has announced plans to m erge its national and m etro p olitan banking d ep a rtm e n ts into a single departm ent. The phased-in op eration will be com plete by the end of th e year. H eading the new banking d ep artm en t will be Ben T. Nelson, ex e c u tiv e vice p re s id e n t and fo rm er head of the m etropolitan banking d e p artm en t, and John A. Sivright, execu tive vice presid ent, form er head of the national banking departm ent. In o th er action, John C. S p ooner has b e e n elected assistant vice p resid en t and head of the hum an relations office. Continental Bank, Chicago, has p ro m oted the following to vice president: M ichael A. Smith, financial services; Chris A. Bowers, U. S. banking ser vices; F rank C. Reid, financial ser v ices; an d W illiam C. R uffin J r., g e n e ra l b a n k in g se rv ic e s. N am ed second vice presidents w ere Yona S. Worthen Bank, L ittle Rock, has p ro m oted Frank Boulton, G lenn H uselton and Paul Lawson to vice presidents and Daniel H uckabay, H elen M cM as te r and J. E. Rowe to assistant vice presidents. Illinois Michael W elgat has joined E lm h u rst National as vice p resid en t/tru st divi sio n . H e is r e s p o n s ib le for n ew business d ev elo p m en t and form erly was with W orth Bank and Michigan A venue Bank, Chicago. Charles J. Obie has been nam ed to the new post of d irector of m arketing at the Illin o is B a n k e rs A sso c ia tio n . H e form erly was d irector of m em b er and public relations. O th er staff changes include nam ing Thom as J. D am m rich, vice presiden t, m anager of th e associa tio n ’s headq u arters; Jam es W. Civik director of education to succeed Mr. D am m rich, and T erry A. Griffin d irec tor of banking organizations. Ben D. Mills Jr. has been appointed executive d irecto r/C E O of th e easy answ er system , an E F T system shared am ong th re e banks in Springfield and one in D ecatur. Mr. Mills form erly w as m a n a g e r of E F T s e rv ic e s for W orld C om p u ter C o rp ., B irm ingham , Mich. The easy answ er system becam e o p eratio n al in M ay, com bining th e Answer N etw ork operated by Springfield M arin e and Illinois N ational, Springfield; th e Easy System , o p er ated by F irst N ational, Springfield; and the A nytim e T eller System , o p e r ated by Citizens N ational, D ecatur. National Boulevard Bank, Chicago, has nam ed th re e new assistant vice presidents. Prom oted to that position was Breck Sw anquist. A ppointed to that position w ere R obert Jelen and Carl Jansen. Mr. Jelen form erly was w ith Talman H om e F ed eral Savings, Chicago; Mr. Jansen form erly was w ith Baird & W arner, Chicago realtor. MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Springfield Marine Bank ...bigger than most big-city banks. There are about 400 banks in the Chicago area. Only 8 of them are bigger than Springfield Marine Bank.* And that makes Marine Bank big enough to handle just about any correspondent bank need. In addition to size, Marine has financial sophistication that wears a smile. You don’t have to go to Chicago or St. Louis for cash letter services, or overline support on agricultural and commercial loans. You’ll find it all at Marine. Marine also has stability. We’re the oldest bank in Illinois. We’ve been here through the good times and the bad. We’ll be here for a long time to come. Put size, sophistication and stability to work for your bank. Call Don McNeely (217) 525-9717 or Mark Janiak (217) 525-9716. ‘ According to an announcem ent by the American Banker, S pringfield M arine Bank was the 9th largest in deposits in Illinois on December 31, 1981. S P R IN G F IE LD Marine Bank East Old State C apitol Plaza S pringfield, Illin o is 62701 (217) 525-9600 M em ber FDIC 69 Binder, Douglas K elner, F re d S. Wayland and B arbara A. W ilson in the financial services d ep artm en t; M ichael L. D eR untz, Leonard Lewicki, David G. M ekem son, Susan J. M ontgom ery, Jerom e V. Rasnak and Addie T. Ruey in th e o p eratio n s and m an ag em en t s e rv ic e s d e p a r tm e n t; M ic h a e l C. C le m e n t, p e r s o n n e l; C h r is to p h e r K w ie c in sk i a n d M ark J. M ick ey , c o rp o r a te fin a n c ia l s e rv ic e s ; a n d E d u a rd o M o n teagu d o and Paul C. Simms, personal banking services. State Bank Fails Farmers State Bank of Fulton County, Lewistown, has purchased the deposits of defunct Farmers State, Lewistown, from the FDIC, following closing in June of the latter institution by William C. Harris, Illi nois commissioner of banks and trust companies. Mr. Harris said depositors were not inconvenienced in any way by the action. Farmers State of Fulton County is a newly chartered institution. Negotiating G roup Named To Study Reunification O f Two Illinois Groups Officers of the Illinois Bankers Asso ciation (IBA) and Association for M od ern Banking in Illinois (AMBI) m et June 17 to discuss a m ethod by w hich negotiations could be u n d ertak en to unify th e two groups. All p re se n t ag reed th at a sincere effort should be u n d ertak en to reunify the Illinois banking in dustry u n d e r a full-service-banking trade association. To accom plish this, each association agreed to be re p rese n te d by a fivem e m b e r n e g o tia tin g te a m , w h ic h would be constructed along th e follow ing guidelines: 1. O n e in d iv id u a l w o u ld b e se le c te d from ea c h of five h o ld in g com pany regions. 2. Two of th e five p eo p le w ould come from banks u n d e r $100 m illion in total assets, two from banks in excess of $100 million in total assets and th e fifth individual u n restricted as to bank size. 3. The negotiating team w ould not include any c u rre n t officers of e ith e r association. 4. Each group w ould appoint one alternate m em b er w ho w ould atten d m eetings and be available should any of the five be unable to serve. The alternate w ould be u n restricted as to bank size. It was agreed th at th e negotiating group would begin m eeting soon at the call of W illiam C. H arris, com m ission70 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis e r of banks, as a nonvoting convener of th e com m ittee. T he negotiating group has a target deadline to re tu rn recom m endations to both associations’ lead ership no later than S eptem ber 15. U n til th e n , no p u b lic or in d u s try announcem ents will be m ade on the team ’s deliberations. O nce the rep o rt is approved by th e leadership of both associations, it will be review ed by the governing body of each and, at th eir option, the m em bership of th eir re spective associations. Both associations will bear equally th e e x p e n se s of th is re u n ific a tio n group. Robert C. Anthony has b een nam ed vice p re s id e n t/m a rk e tin g d ire c to r, Bank of New O rleans. H e form erly was vice president/m etropolitan business developm ent d ep artm en t at BNO. Indiana Martha Bates has b een prom oted to assistant cashier at Brookhaven Bank, w here she had been m anager, H igh land S quare B ranch, since A ugust, 1981. A. Lee Campbell has been prom oted to p re s id e n t/C E O , P e o p le ’s T ru st, Brookville, succeeding H arold Geis, who re tired July 1. M elvin H artm an was prom oted to executive vice presid e n t/tr u s t officer, Joyce Back was nam ed vice president/cashier/assistant tr u s t officer and G erald Lake was prom oted to vice p resident/senior loan officer. Richard W. Spears has b e e n p ro m oted to senior vice p resid en t at In d i ana National, Indianapolis. Also p ro m oted w ere Richard L. F rench, W il liam R. L ockw ood an d M o rris L. M aurer to first vice presidents; David G. King and M ichael K. P ritchard to vice presidents tru st officers; and L in da H. A ckerm ann, Rebecca L. H izer and Vicki S. W ood to assistant vice presidents. Diane L. Burch was prom oted to assis tan t vice p resid en t at Lincoln N ation al, F ort W ayne, recently. She joined th e bank in 1971. Kentucky First Security National, Lexington, has announced these prom otions: to vice p residents, L inda W. Critchfield, E ileen D. D urbin, D onald W. Kelly and D avid J. M ellen; to assistant vice presidents, Steven S. C am pbell and M ichael D. H arp er and to assistant cashiers, Sara C. M oon, Susie Stevens and M argaret L. W hitaker. Louisiana First National Bank of C om m erce, New O rleans, has joined th e Society for W o rldw ide In te rb a n k Financial T e le c o m m u n ic atio n (S W IFT ). T he netw ork, accessible only to m em ber institutions, is used for international m o n ey tra n sfe rs, fo reig n -ex ch an g e transactions and trade letter-of-credit operations. Hibernia National, New O rleans, has announced these prom otions: to vice president/m ain office division, Nelson Breve; to vice p resid en t/tru st division, James W. Byron J r .; to vice p resident/ m aritim e d ep artm en t, G erald P. Gil bert, and to vice p resident/energy d e partm ent, John J. Pribil. Mississippi The Fed has approved form ation of th e s e M ississippi b an k H C s: F irst B olivar C ap ital C o rp ., C le v e la n d , through acquisition of F irst N ational of Bolivar C ounty, C leveland; G ateway Capital C orp., H ernando, through ac quisition of H ernando Bank, and Colo nial Capital C orp., M antee, through acquisition of Bank of M antee. New Mexico F irst N a tio n a l, A lb u q u e rq u e , has nam ed L oren A. H agem eyer senior vice p r e s id e n t/c o m p tr o lle r . H e form erly was vice p resid en t at Midway National, St. Paul, M inn. Lou Ronquillo was prom oted to assistant vice president and Min L. G rant has joined the bank as a tru st officer. J. W esley Willis has been nam ed p re s ident of F irst National, Socorro. H e form erly was vice p resid en t at First State, Rio Rancho. Both banks are affiliates of B ank S e c u ritie s, In c ., A lbuquerque. Robert J. D yer has been appointed senior vice presid en t in charge of cor respondent banking at A m erican Bank o f C o m m e rc e , A lb u q u e r q u e . H e form erly was p re s id e n t of Security Bank, Ruidoso. G. G ene H erth el was appointed vice president. H e comes from M e tro N a tio n a l, D e n v e r. Michael J. Freitas was appointed assis tant vice p resid en t and G regory N. Moody was nam ed assistant cashier. Oklahoma Richard D. Smith has been appointed executive vice presid en t at Anadarko B ank. H e co m es fro m E x c h a n g e National, A rdm ore, w here he was vice president/com m ereial loan officer. MID-CONTINENT BANKER for August, 1982 Help Stamp Out Director Liability Risk With These Board-Related Manuals CORPORATE ETHICS . . . What Every D irector Should Know. $23.00 Society The Effective Board Audit is demanding more disclosure from all businesses, including banking. Thus, bankers literally are forced to re-exam ine policies on types of information that can be disclosed publicly. The board's disclosure policy can be a major factor in the public's judgment of a bank. The fact that a bank is willing to discuss . . . or make public . . . any of its actions will encourage high stan dards of conduct by the bank staff. This manual (over 200 pages) will help directors probe "grey” areas of business conduct so that directors can establish w ritten codes for their own bank. BOARD PO LICY ON RISK M A N A G E M ENT. $17.50 This 160-page manual provides the vital information a board needs to formulate a system to recog nize insurable and uninsurable risks and evaluate and provide fo r them. In cluded are an insurance guideline and checklists to identify and protect direc tors against various risks. Bonus fea ture: A model board policy of risk management adaptable to the unique situations at any bank. Every member of your bank's board should have a copy! $19 $17.50 Recently o ff the press! This revised and expanded manual enables directors to be a step ahead of bank regulators by providing current loan and credit poli cies of numerous well-managed banks. These policies, adaptable to any bank situation, can aid your bank in estab lishing broad guidelines for lending officers. Bonus feature: Loan policy of one of the nation's major banks, loaded with ideas for your bank! Remember: A written loan policy can protect direc tors from lawsuits arising from failure to establish sound lending policies! Order enough copies for all your direc tors! CO N FLICTS OF INTEREST. $12.00 (Third Edition) Conflicts of Interests presents everything directors and o ffi cers should know about the problem of "conflicts.” It gives examiners'views of directors' business relationships with the bank, examines ethical pitfalls in volving conflicts and details positive actions for reducing the potential for conflicts. Also included is the Comp troller's ruling on statements of busi ness interests and sample conflict-ofinterest policies in use by other banks which can be adapted by your board. Q U A N T IT Y PRICES Q U A N T IT Y PRICES 2 - 5 copies — $10.00 ea. 6 -1 0 copies — $9.50 ea. 2 - 5 copies — $10.00 ea. 6 - 1 0 copies — $9.50 ea. THE B A N K BOARD LETTER 408 Olive St., St. Louis, MO 63102 .........copies. .........copies. .........copies, .........copies, .........copies, Board Policy on Risk Management The Effective Board A udit Bank Board & Loan Policy Conflict of Interest Corporate Ethics Total Enclosed $ $ $ $ $ $ N a m e ......................................................................................... Title Bank................................................................................................... Street ................................................................................................. City, State, Z ip ................................................................................. (Please send check with order. In Missouri, add 4.6% tax.) m MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis $12 THE B A N K BO ARD A N D LO AN POLICY. $12.00 (Fourth Edition) Q U A N T IT Y PRICES 2 - 5 copies — $17.00 ea. 6 - 10 copies — $16.00 ea. BANK BOARD LOAN POLICY Q U A N T IT Y PRICES comprehensive information about the directors' audit function. It outlines board participation, selection of an audit committee and the magnitude of the audit. It provides guidelines for an audit committee, deals with social re sponsibility and gives insights on en gaging an outside auditor. It includes checklists for social responsibilities audits, audit engagement letters and bank audits. No director can afford to be w ithout a copy! For Director! and Officer! of Financial Institution! ^ RISK MANAGEMENT 2 - 5 copies — $15.50 ea. 6 - 10 copies — $14.50 ea. THE E FFE C TIVE BOARD A U D IT . $19.00 This 184-page manual provides What Every Director Should Know About Conflicts of Interest CORPORATE ETHICS Q U A N T IT Y PRICES 2 - 5 copies — $21.00 ea. 6 - 10 copies — $19.50 ea. $23 71 Data Processing Agreement Made by Fidelity, Okla. City Fidelity Bank, Oklahom a City, has sold its co rrespondent bank data p ro cessing business to E lectronic D ata Systems C orp., Dallas. The acquisi tion was effective last July 1. A spokesm an said th e 100 Oklahom a banks whose data processing services are involved in th e acquisition will continue to receive banking services as perform ed by satellite data centers in Lawton and M cAlester. A new satellite cen ter will be established in Oklahom a City. T h e O k lah o m a a c q u is itio n from Fideltiy will be linked into the nation w id e c o m m u n ic a tio n s n e tw o rk for c o m p u te r p ro c e ssin g at E le c tro n ic D ata System s’ data cen ter at R ichard son, Tex. Fourth National, Tulsa, has appointed Stephen A. M illigan vice p resid en t/ tru st officer, and prom oted Barbara B. Glass to assistant vice presid en t/p ersonnel, C athy Kunkel to assistant vice p re sid e n t/tru st officer and M. E liz abeth Snider to assistant vice president/audit. Linda L. M o o re, v ice p r e s id e n t, Liberty National, O klahom a City, re c e n tly b e c a m e th e first O klahom a woman to graduate from th e Stonier G raduate School of Banking at Rutgers U niv ersity . M rs. M oore g ra d u a te d w ith distinction, an honor bestow ed only on the top 20 graduates of the class of som e 340 can d id ates. H e r thesis, “A lternative M arketing S truc tu re s of M ulti-B ank H olding C om pan ies,” has been placed in th e Stonier library. Edward F. K eller, p resid en t, O klaho m a B an k ers A ssociation, has b e e n e le c te d c h a ir m a n /C E O , F o u r th National, Tulsa. H e form erly was w ith M erc a n tile Bank, T ulsa, w hich he joined in 1979 as p resident. H e b e cam e chairm an/C E O th e re in 1981. Mr. K eller has been a banker since 1963. Frank X. H enke III, who was F ourth o fT ulsa’s chairm an/C E O , con tinues in those posts at th e bank’s p a r e n t H C, F o u rth National C o rp ., Tulsa. 72 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Tennessee US B ank, N a sh v ille , has e le c te d W ayne E. G lenn, president, U nited Paperw orkers International Union, to its advisory board. Mr. G lenn is a vice p resid en t and m em ber of the execu tive council of the A FL-C IO as well as vice p resident of the industrial union d e p a rtm e n t of that organization. In o th er action, Sandra H ew itt has been nam ed vice president/m etropolitan di vision, and Rick Short has joined the bank as an assistant vice p resid en t/ com m ercial group. Third National, Nashville, has pro m oted E llen K em p to assistant vice p resid en t and L attie Brown, W eldon B. Kidd and C hristopher L. W hite to com m ercial officers. John B artlett and C laire Stew art w ere nam ed assistant com m ercial officers. Two HCs' Boards Approve Their Proposed Merger B oards of T h ird N ational C o rp ., N ashville, and A ncorp B ancshares, Inc., C hattanooga, have approved a m e r g e r a g r e e m e n t. S h a r e h o ld e r ap p ro v al w ill b e so u g h t in special m eetings, and regulatory approval also is required. U nder term s of th e agreem ent, as previously announced, Ancorp share holders w ould receive 1.18 shares of T hird National com m on stock for each share of Ancorp com m on stock held. T hird National w ould be th e surviving corporation, w ith assets totaling about $3 billion. It th en w ould becom e the state’s second-largest bank HC. The ag reem ent also calls for com bin ing senior-m anagem ent groups of the m erged com panies. C harles J. Kane, now chairm an/C E O , T hird National C orp., w ould continue in those posts. Scott L. Probasco Jr., now chairm an/ C E O of Ancorp, w ould becom e the m e rg e d firm ’s p re s id e n t. Jo h n E. S outhw ood, T h ird N ational C o rp .’s p resid en t, w ould be vice chairm an/ chairm an of the operating com m ittee. M anagem ents of A m erican N ation al, C hattanooga, and T hird National Charles J. Kane (r.), ch./CEO, Third Nat'l Corp., Nashville, and Scott L. Probasco Jr., ch./CEO, Ancorp Bancshares, Inc., Chatta nooga, are shown after signing merger agreement that has been approved by their respective boards. Bank, Nashville, and o ther bank affili ates in the m erged organization w ould be unchanged. Texas R iver Oaks B ank, H o u s to n , has nam ed R o b ert R. F ran k lin Jr. and M ichael K. R ich ard so n vice presidents/com m ercial loans. Mr. Franklin is new to the bank; Mr. Richardson form erly was an assistant vice p resi dent. Fort Worth National has prom oted Richard A. B everburg and Ronald P. Pollard to vice p residents and James M. M aroney to assistant vice p resi dent. M essrs. B everburg and Pollard are in c o rresp o n d en t cu sto m er se r vices; Mr. M aroney is m anager, cor respondent banking. F irst N a tio n a l, D a lla s, r e c e n tly changed its nam e to In te rF irst Bank Dallas, National Association. The bank is the lead in stitu tio n of In te rF irs t C o rp ., fo rm erly F irst In tern atio n al Bancshares. The bank had operated as F irst National since 1930. George Cason has b een nam ed assis ta n t tru st officer at F irst N ational, Amarillo. H e form erly was w ith RepublicBank G arland. First National, F o rt W orth, has ex panded its m anagem ent team . James R. Perry was elected chairm an/C E O , Jerry D. M inton was elected to the board and nam ed vice chairm an/chief adm inistrative officer, Ronald L. Par rish was e le c te d to th e b o ard and nam ed presid en t/ch ief banking officer and Paul Mason was elected chairm an/ executive com m ittee. H e form erly was board chairm an. Mr. P erry joined the bank as p re sid e n t in 1977 and was n am ed C E O in 1979; M r. M inton joined the bank in 1965; Mr. Parrish is new to the bank, com ing from Inter- MID-CONTINENT BANKER for August, 1982 Looking for a star in the east? Here are five If you're a banker in eastern O klahom a here are some people w orth knowing. They're First Correspondent Bankers w ho cover the eastern part o f the state. And do an exceptional job o f it. A large measure o f th e ir success can be attributed to their approach. An approach w hich centers around the crucial concept o f response time. When you need an answer today, you get it. This co m b in a tio n o f outstanding response tim e and financial resources unequalled in Oklahoma makes fo r an unbeatable correspondent relationship. So the next tim e you need upstream support, look fo r a First Correspondent Banker. He's The Source o f all your correspondent needs. L to R: Randy Burns, Banking O fficer Gary Embry, Assistant Vice President Kendall Hert, Vice President Steve Sims, Vice President Kevin Lynch, Banking O fficer MID-CONTINENT BANKER for August, 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 73 Index to Advertisers PERRY PARRISH MASON MINTON First, Beaum ont, w here he was chairm an/C E O ; Mr. Mason jo in ed th e bank in 1962 and had b een chairm an/C E O since 1971. H e also is chairm an/presid e n t/C E O , F irst U n ite d B an co rp ., paren t of F irst of F o rt W orth. Frost N a tio n a l, San A n to n io , has prom oted Larry Black and C. S. P lu m m e r Jr. to se n io r vice p re s id e n ts ; Raymond Burgess, W illiam H. F rost and D ean W alker to vice presidents; and Vangie Leal to assistant vice p re si dent. BANK POSITIONS SECOND OFFICER — Small suburban .............. $25K COMMERCIAL LOAN — #2, $90MM dept........... $38K EXEC. VICE PRES. — $40MM community bank $35K CASHIER — $30MM r u r a l...................................... S25K COMMERCIAL LOAN — $70MM s u b u rb a n ........ $30K AGRI LOAN — $20MM r u r a l.................................. $28K TRUST OFFICER — Small dept./rural ................ $20K REAL ESTATE — #2, $150MM b a n k .................. $30K INST. LOAN — $50MM Rocky Mtn. Bank .......... $20K John T. Cooney, executive vice president/senior tru st officer, Bank of the Southw est, H ouston, has b een elected chairm an, Texas Bankers Association tru st division. Karen J. Cole, senior vice p resid en t/tru st officer, In te rF irst Bank, H ouston, was elected first vice chairm an; John A. Wolf, executive vice p resid en t/tru st officer, F irst City National, Austin, was elected second vice chairm an; and W illiam J. Stokes, se n io r vice p r e s id e n t/tru s t officer, F irst National, Tem ple, was elected secretary-treasurer. M ercantile Bank, Dallas, has elected David C. H orn, Tyree B. M iller and S tephen C. O w en senior vice p resi dents. Randal L. R ipple was elected vice p re sid en t/o p eratio n s and Janet M u rp h ree was nam ed assistant vice president/funds m anagem ent. Joe C. T h o m p so n Jr. w as e le c te d to th e board. H e is executive vice p resident, S outhland C o rp ., convenience-store operator. Additional opportunities available for experienced bank ers. Forward resumé and salary requirements in confi dence to: TOM HAGAN & ASSOCIATES of KANSAS CITY P.O. Box 12346/2024 Swift North Kansas City, MO 64116 816/ 474-6874 SERVING THE BANKING INDUSTRY SINCE 1970 WANTED TO BUY One used modular building to accommodate Diebold ATM Model 910 machine. Building size approximately 10' X 12'. Contact: Michael D. Travelstead, President, DuQuoin State Bank, P.O. Box 468, DuQuoin, IL 62832. Phone (618) 542-2111. TH E T O T A L B A N K SYSTEM "designed for the commercial bank,, On-line Data Processing Providing Software Customized for Your Bank Computer Hardware Dedicated to Your Bank Data Processing Controlled by Your Bank Acceleration Life Insurance .................................. 13 Advertising Concepts, Inc....................................... 57 American Express Co. (Travelers C heques)........ 39 Armco Industrial Credit Corp.................................. 41 Baker & Co., Jam es................................................. 7 Bank-Aide, Inc........................................................ 74 Bank Board Letter ........................................ 67, 71 Bank Building Corp.................................................. 20 Boatmen’s National Bank, St. Louis ................. 75 Cattle-Fax .............................................................. 30 Centerre Bank, St. Louis ...................................... 76 Central Bank, B irm ingham ................................... 33 Christmas Club — A Corporation ....................... 19 Citicorp Remittance Service ............................... 9 Commerce Bank of Kansas City ......................... 5 Commercial National Bank, Kansas City, Kan. 54 Continental Bank, Chicago................................... 43 Ecom Systems, Inc................................................. 45 Farm Estate & Business Planning ..................... 27 Federal Land Bank, St. Louis ............................. 23 Federal Sign .......................................................... 58 First Alabama Bank, Montgomery....................... 68 First Missouri Development Finance Corp........... 62 First National Bank, Fort Worth ......................... 18 First National Bank, Kansas City ....................... 25 First National Bank, St. Joseph, Mo.................... 65 First National Bank of Commerce, New Orleans 6 First Oklahoma Bancorp......................................... 73 First Total Systems, Inc......................................... 74 Fourth National Bank, Tulsa ............................... 31 Fourth National Bank & Trust Co., Wichita . . . . 55 Hagan & Associates, Tom ................................... 74 Hutchinson National B a n k ................................... 50 Industrial Life Insurance Co.................................. 14 Kansas State Bank, Wichita ............................... 52 Liberty National Bank & Trust Co., Oklahoma City 2 Memphis Bank &Trust Co...................................... 4 Mercantile Bancorp., St. Louis ........................... 11 Mercantile National Bank, Dallas ....................... 15 Monteleone ............................................................ 32 MPA Systems, El Paso, Tex................................... 44 National Bank of D e tro it....................................... 8 RepublicBank, Dallas ........................................... 35 St. Johns Bank & Trust Co.................................... 63 Security National Bank, Kansas City, Kan........... 53 South Side National Bank, St. Louis ................. 61 Southwest National Bank, Wichita ..................... 51 Springfield Marine Bank, Springfield, III............. 69 Stifel, Nicolaus & Co., St. L o u is ......................... 49 Third National Bank, Nashville ........................... 37 Union National Bank, Little R o c k ....................... 47 United Missouri Bank, Kansas City ................... 60 United Southern Banks, Nashville ..................... 29 Vendors Insurance Agency ................................... 17 Whitney National Bank, New Orleans ................ 3 Zahner & Co............................................................ 64 Training Motivation equals Extra Profits plus Bankers face trends which re quire that productivity per em ployee be increased substantial ly! An investment in our training and m otivational system w ill lead to those EXTRA bottom-line profits. WRITE OR CALL FOR A CONFIDENTIAL PROPOSAL M ir © tî T o t a l S y s t e m s I n c . CBANJ^\1DE in c (303) 753-0295 1650 South Colorado B oulevard, Denver, Colorado 80222 Professional Bank Ctmsuhants a g ~ T » » y , ra v .. ■ 74 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis mm r t .vìs s t « - » irsssmr- «* « » ■ » ** « 734 West Port Plaza Suite 255 St. Louis, Missouri 63141 314 434-8899__________ | T MID-CONTINENT BANKER for August, 1982 Boatmen’s Ernie Hellmich Operations Assistance. Boatmen’s Correspondent Banking Officer Ernie Hellmich and J. D. Moss, President and Chief Executive Officer of Litchfield Bank and Trust Company. Whatever your correspondent needs, Boatmen’s has knowledgeable people to assist you. Call Ernie Hellmich. He can help. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C orrespondent Banking Division THE BOATMEN'S NATIONAL BANK O F ST. LOUIS 3 1 4 -4 2 5 -3 6 0 0 Member FDIC If industrychange has you inthe dark, we can help. Change. It’s everywhere in our industry today. Bringing with it problems w e ’ve never known. Challenges w e’ve never faced. And opportunities more bountiful than ever before. That’s why, now more than ever, a correspondent bank like Centerre is essential to your operation. You can count on us for the best possible availability on check collections, as well as speedy response to overline loan requests. And in addition to our traditional services, you can look to us fo r advice. On state-of-the-art technology. Industry legislation. New forms of com petition. And just about anything you need to know to help your customers. So if industry change has you in the dark, give us a call. At Centerre, we can help. CENTERRE RANK MidAmerica’s Bankers. One Centerre Plaza St. Louis, Mo. 63101 9th & Walnut Streets Kansas City, Mo. 64106 Member FDIC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis
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