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The Financial Magazine o f the Mississippi Valley <& Southwest
MAY

1, 1977

CONVENTION PREVIEWS: Alabama, AMBI, Missouri, Texas, Oklahoma, Kansas
1977: YEAR OF THE NATIONWIDE NOW ACCOUNT? Prominent Bankers Give Views
(see pages 25-36)

First National, Amarillo, Tex., to Dedicate New Complex May 22 (see page 48)

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Is your bank
interested in mare
Demand
Deposits?

Recently, M acklanburg-Duncan Com pany’s salaried
em p lo ye e s becam e th e firs t c o rp o ra te e m ployee s
in O klahom a to have th e ir p aychecks e le c tro n ic a lly
processed and d e p o site d d ire c tly to in d ividu al
bank ch e c k in g a c c o u n ts . . . w ith th e help o f Liberty.
T h is s e rv ic e m eans increased D em and D eposits
fo r us.
A n d w e can help yo u o ffe r th e sam e se rvice fo r
em p lo ye e s o f y o u r co m m e rcia l custom ers. D ire c t
pa yro ll d e p o s it u tilize s L ib e rty ’s E le c tro n ic Funds
T ransfer S E R V IC E S , and th e fa c ilitie s o f th e IVlidA m e ric a A u to m a te d C learing H ouse A s s o c ia tio n ...

tn ro u g h L ib e rty ’s C o rre sp o n d e n t D e p a rtm e n t.
F o r exam ple, w ith D ire c t D e p o sit Payroll se rvice ,
e m ployee s can be guarante ed th e ir pay w ill be
availab le in ch e ckin g o r savings accounts on tim e
. . . a ll th e tim e, even w hen th e y are o u t-o f-to w n
o r on vacation. T h e re is no chance fo r lost o r stolen
p a y c h e c k s .. .tim e consum ing g ro c e ry sto re visits
...a n d no need fo r th e e m p lo ye e to c a rry large
am ounts of cash.
To learn m ore a b out th is e x c itin g new o p p o rtu n ity
co n ta c t th e C o rre sp o n d e n t D e p a rtm e n t. . .

LIB ER T Y
THE BANK OF MID-AMERICA
Liberty National Bank and Trust Company/P. O. Box 25848/OkIahoma City 73125/Phone: 405/231 -6386/Member F.D.I.C.
MID-CONTINENT BANKER is published 13 times annually (two issues in May) at 403 Olive, St. Louis, Mo. 63102. May 1, Vol. 73, No. 5.
Second-Class postage paid at Fulton, Mo. Subscription: $10.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

When it cornes to D&O Protection,
more financial institutions
choose M GIC.

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MID-CONTINENT BANKER for May 1, 197 7

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Federal Reserve Bank of St. Louis

4. MGIC also provides every policyholder with
a quarterly copy of Counsel— an MGIC
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It is this unique combination that
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around money the finest is
1

5 OLD S T Y L E COIN W R A P P E R

A U T O M A T I C COIN W R A P P E R

2 T U B U L A R COIN W R A P P E R

E specially designed fo r m a chine fillin g . . . a real tim e-saver.
Packed fla t. In s ta n t patented “ Pop O pe n” action w ith fin g e r
tip pressure. D eno m ination s id e n tifie d by co lo r cod in g . . . 6
d iffe re n t standard colors.

Basic coin w rap per in extra stro n g k ra ft stock. P rinted in 6 f
d iffe re n t stan dard colors to d if f e r e n t ia t e d e nom ina tio ns.
T r ip le d e s ig n a tio n th r o u g h colors, p r in t in g and letters.
Tapered edges.

A m ou nts and de no m in a tio n s a u to m a tic a lly in d ic a te d by
patented “ re d bordered w in d o w s ” . A m o u n ts in w indow s
alw ays in re g is te r. . . elim in a te s m istakes. A ccom m odates
all coins fro m l c to $1.00.

R A I N B O W COIN W R A P P E R

7 F E D E R A L BILL S T R A P
Package con tents clearly id e n tifie d on faces and edges by
color coded panels w ith inverted and reverse figures. Made
o f extra s tro n g stock to assure unbroken deliveries. O nly pure
de xtrine g u m m in g used.

Color coded fo r quick, easy id e n tific a tio n . Red fo r pennies . . .
b lue fo r nickels . . . green fo r dim es . . . to indicate q u a n tity
and de n o m in a tio n s . . . elim in a te s m istakes. Tapered edges.

D U Z I T A L L COIN W R A P P E R
Extra w ide . . . extra strong. Designed fo r areas w here halves
are w rapped in $20.00 p a c k s . . ." r e d bordered w in d o w ” fo r
ease o f id e n tific a tio n . A ccom m odates $20.00 in dollars, $20.00
in halves. Tapered edges.

K W A R T E T COIN W R A P P E R
W raps 4 de no m in a tio n s in h a lf size packages. A m in ia tu re o f
th e p o pular "A u to m a tic W rapper” . . . 25c in pennies, $1.00 in
nickels, $2.50 in dim es, $5.00 in qu arte rs.

C O L O R E D BILL S T R A P
E ntire stra p is color coded to id e n tify de n o m in a tio n . Printed
a m o u n t appears on to p and bo tto m o f package. Extra w ide
fo r m a rking and stam ping. Extra stro ng s to c k fo rs a fe d e live ry
and storage. Pure dextrine g u m m in g .

9 BANDING S T R A P S

Ideal fo r packing currency, de p o sit ticke ts, checks, e tc .. . . do n o t break
o r d e teriorate w ith age. Size 10 x % inches and m ade o f stro ng brown
K ra ft stock w ith gum m ed end fo r ease o f sealing. Packed 1000 to a carton.

SEE

THE

C . L. D O W N E Y

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Federal Reserve Bank of St. Louis

YOUR

DEALER

COMPANY

SEND

FOR

FREE

• HANNIBAL,

SAMPLES

MISSOURI

D E P T . MC

MID-CONTINENT BANKER for May 1, 1977

Discussing coal production
in Williamsburg are Murphy
Brock, Liberty Vice President;
Hugh Steely, Chairman and
President of Farmer’s National
Jim McKenzie, Asst. Cashier
Liberty Bank; “Andy" Frost,
Owner of Woodbine Coal
Company; and John Lawson,
Vice President of
Farmer’s National.
MID-CONTINENT BANKER for May 1, 1 9 7 7

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Federal Reserve Bank of St. Louis

Liberty National Bank
and Trust Company of Louisville
5

M K1NENT BANKER

Convention Calendar

The Financial M agazine o f the M ississippi Va lley & Southw est

May 1, 1977

Volume 7 3 , No, 5
FEATURES
27 MID-CONTINENT-AREA BANKERS OPPOSE NOWs

Say customers will have to pay for them
40 SIMPLIFIED RESERVE REQUIREMENT COULD RAISE EARNINGS

Would minimize idle cash and maximize earning assets

Larry C. Hem pel

50 N O W ACCOUNTS FACE HEAVY FIRE FROM IBAA

Opposition voiced at recent convention
54 SECURITY N ATIO NAL BANK OPENS NEW BUILDING

Shows faith in downtown Kansas City, Kan.
60 BOATMEN'S BANK OPENS NEW K.C. HEADQUARTERS

* Seven-year growth record cited at opening
6s? ATTENDANCE JUMPS AT LOUISIANA B.A. CONVENTION

s Unity sought in support of EFT bill

]*m Fabian

CONVENTIONS
76 ALABAM A

83 MISSOURI

103 O K LA H O M A

79 AMBI

93 KANSAS

106 TEXAS

74 FIRST TIMERS

DEPARTMENTS
12 COM M UNITY INVOLVEMENT
14 SELLING/MARKETING

8 BANKING SCENE
II BANKING WORLD

16 EFTS
19 OPERATIONS

STATE NEWS
110 ALABAM A

NO ILLINOIS

110 ARKANSAS

112 IN D IAN A
112 NEW MEXICO

Editors
Ralph B. Cox
Editor & Publisher

Lawrence W. Colbert
Assistant to the Publisher

Rosemary McKelvey
Managing Editor

Jim Fabian
Associate Editor

Daniel H. Clark
Assistant Editor
Advertising Offices
St. Louis, Mo., 408 Olive, 63102, Tel. 314/
421-5445; Ralph B. Cox, P ublisher; Mar
garet Holz, A dvertising P roduction Mgr.
Milwaukee, Wis., 161 W. W isconsin Ave.,
53203, Tel. 414/276-3432; Torben Soren
sen, A dvertising Representative.

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Federal Reserve Bank of St. Louis

112 KENTUCKY
112 MISSISSIPPI
113 TENNESSEE

MID-CONTINENT BANKER is published
13 tim e s an nually (two issues In May)
by Commerce P ublishing Co. at 1201-05
B lu ff, Fulton, Mo. 65251. E ditorial, execu
tive and business offices, 408 Olive, St.
Louis, Mo. 63102. P rinted by The Ovid
Bell Press, Inc., Fulton, Mo. Second-class
postage paid a t Fulton, Mo.
S ubscription rates: Three years $21; tw o
years $16; one year $10. S ingle copies,
$1.50 each.
Commerce P ublications: Am erican Agent
& Broker, Club-M anagement, Decor, Life
Insurance S elling, M id-C ontinent Banker.
Mid-Western Banker, The Bank Board
Le tter and Program. Donald H. Clark,
cha irm an; Wesley H. Clark, president;
Johnson Poor, executive vice president
and secretary; Ralph B. Cox, firs t vice
president and treasurer; Bernard A. Beggan, W illia m M. Hum berg, James T. Poor
and Don J. Robertson, vice presidents;
Lawrence W. Colbert, assistant vice presi
dent.

May 12-15; 28th Assembly for Bank Directors,
Palm Beach, Fla., the Breakers.
May 14-18: Mississippi Bankers Association
Annual Convention, Biloxi, Broadwater
Beach/Biloxi Hilton.
May 15-16: ABA/Insurance Industry Confer
ence, Arlington, Va., Crystal City Marriott.
May 15-17: Tennessee Bankers Association An
nual Convention, Gatlinburg, Sheraton Hotel.
May 15-18: ABA National Operations/Automa
tion Conference, New Orleans, Hyatt Regen
cy.
May 15-18: Arkansas Bankers Association An
nual Convention, Hot Springs, Arlington
Hotel.
May 15-18: Bank Marketing Association Staff
Sales Training Workshop, Phoenix, Del
Webb’s Mountain Shadows Resort.
May 15-20: ABA National Commercial Lending
Graduate School, Norman, Okla., University
of Oklahoma.
May 15-20: ABA National Personnel School,
Pittsburgh, Marriott Inn.
May 15-20: Louisiana Banking School for Su
pervisory Training, Lafayette, University of
Southwestern Louisiana.
May 17-20: Bank Administration Institute Com
puter Performance Measurement Seminar f
New York City.
May 22-25: ABA National Conference on Real
Estate Finance, San Francisco, St. Francis
Hotel.
May 22-25: NABW Southern-SoutheasternSouth Central & Florida Regional Con
ference, Nashville, Hyatt Regency Hotel.
May 22-27: Bank Marketing Association Es
sentials of Bank Marketing Course, Boulder,
Colo., University of Colorado.
May 22-27 : Bank Marketing Association
School of Trust Business Development &
Marketing, Boulder, Colo., University of
Colorado.
May 22-28: Independent Bankers Association
of America Seminar for Senior Bank Of
ficers, Boston, Harvard Business School.
May 22-June 3: Bank Marketing Association
School of Bank Marketing, Boulder, Colo.,
University of Colorado.
May 23-27: Bank Administration Institute
EDP Auditing Introduction II Short Course,
Norman, Okla., University of Oklahoma.
May 25-27: Bank Administration Institute Es
tate Tax Planning Seminar, Memphis.
May 30-June 1: American Institute of Bank
ing Annual Convention, Phoenix, Hyatt
House.
June 2-3: Robert Morris Associates Com
mercial Loan Training Program: Content
and Methods Workshop, Washington, D. C.,
Key Bridge Marriott.
June 3-10: ABA National School of Bank In
vestments, Dallas, Southern Methodist Uni
versity.
June 5-7: Illinois Bankers Association Annual
Convention, Chicago, Palmer House.
June 5-17: ABA National Installment Credit
School, Boulder, Colo., University of Colo
rado.
June 7-10: Bank Administration Institute Op
erations Management I Short Course, Nor
man, Okla., University of Oklahoma.
June 8-10: Bank Administration Institute
Money Transfer Seminar. Chicago.
June 8-10: Association of Bank Holding Com
panies,
Annual
Convention,
Colorado
Springs. Colo., Broadmoor Hotel.
June 9-10: Robert Morris Associates Loan
Quality Control Workshop, Philadelphia,
Sheraton -Downtown.
June 9-10: Robert Morris Associates Loan
Quality Control Workshop, Philadelphia,
Sheraton -Downtown.
June 9-11: New Mexico Bankers Association
Annual Convention. Santa Fe. Hilton Inn.
June 9-12: National Association of Bank
Women Westem/Rocky Mountain Regional
Conference, Reno, Nev., Pioneer Inn.
June 12-15: Robert Morris Associates F i
nancial Statement Analysis Workshop, Bos
ton, Colonnade Hotel.
June 15-16: Indiana Bankers Association An
nual Convention, French Lick, French LickSheraton.
June 16-17: Robert Morris Associates Foreign
Credit Analysis Workshop, Chicago, Hyatt
Regency O’Hare.
June 20-22: National Association of Bank
Women Lake/Midwest/North Central Re
gional Conference, Indianapolis, Indian
apolis Marriott Inn.
June 22-24: Bank Administration Institute
Current Bank Tax Problems Seminar, Den
ver.

MID-CONTINENT BANKER fo r Mu' 1. 1977

You re looking for extra profits.
Our cash letter analysis can
uncover ’em .

It’s surprising how much
potential profit is buried under
slow paper.
That’s why we’ve developed
an effective action program to
help you get things moving.
Our program includes
computerized cash letter analysis
... plus practical methods
for improving proof operations
and check collection.
Start us digging for those
profits— call 314-425-2404.

We’re w ith you.

MERCRflTILE
B n rx

Mercantile Trust Company N.A. • (314) 425-2404 • St. Louis, Mo. • Member F.D.I.C.
MID-CONTINENT BANKER for May 1, 197 7

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Federal Reserve Bank of St. Louis

T h e B a n k in g S c e n e
By Dr. Lewis E. Davids
Hill Professor of Bank Management,
University of Missouri, Columbia

PAP— Its Evolution, Growing Acceptance
O SOME NONBANKERS, “PAP”
means any soft food for babies. To
women, the letters have an altogether
different connotation; to bankers, PAP
stands for Pre-Authorization of Pay
ment.
There is, in one context, a parallel
among the several uses of the acronym.
In the former use, it’s a product that
will be acceptable to an infant and pre
pares a child for more substantial and
less digestible nourishment; the second
meaning is a test one takes to detect
cancer.
The latter, financial concept of PAP
has had a most interesting history in the
United States. PAP could be related to
many areas, including accepted letters
of credit and other negotiable instru
ments, but in today’s economy its great
est impact has been on checks, bank
competition and the American public’s

from one postal station to a paper or
electronic clearing house, then through
the clearing house to the account of the
creditor.
The switch in its early days was by
use of a paper document. In more de
veloped countries the switch today is
done by electronic fund transfer (E F T )
and usually involves paperless entries.
While commercial banks outside the
U. S. have had experience with GIRO
systems, it is paradoxically interesting
that the initiative for such a system of
ten is not from commercial banks, but
from thrift institutions, postal or rail
road systems. In the U. S. much of the
initiative has come from a few major
life insurance, utility and telephone
companies. A few commercial banks,
however, have had PAPs for genera
tions. Often, bank regulators are igno
rant of such activities, or, if not ignorant,

"In some instances, our competitors have distinct ad vantag es . . .
in not being subject to the costly regulations bankers must bear
as their cross. . . . Food chains, dealing with necessities of life, are
likely to get a customer traffic-pattern that's conducive to cross
selling the grocery's 'bank services'; a bank's lobby traffic would
not be likely to generate sales of food, goods and related ser
vices."

willingness to—at least in part—switch
from the use of checks to PAP.
PAP in its various forms is related
more frequently to GIRO systems such
as are found in Europe and the Orient.
In those areas, the use of checking ac
counts by the bulk of the population is
not as common as in this country. A
growing society, postal system, mutual
bank, S&L, or—less commonly— com
mercial bank, often may operate a
GIRO system. Under such a system, the
institution is pre-authorized by its debt
or/customer to make certain periodic
payments on the request of the creditor.
That remittance simply may be a switch
of funds from a savings account to the
mortgage department collection section,
or it may involve a greater distance—

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Federal Reserve Bank of St. Louis

they either ignore them or prefer not
to prohibit or regulate a system that is
engaging in a modest effort at innova
tion.
In the early 1950s, for example, when
I was a newly employed professor of
banking at a good-sized but geographi
cally isolated college, one of my first
acts was to visit a well recommended
bank and open an account. The newaccount signature card of that bank
had a space for me to authorize the
institution to pay a number of likely
regular payments: the telephone com
pany, the garbage collector, the gas
company, electric utilities, principal, in
terest, escrow for taxes and insurance
on my home, etc.—I even could au
thorize insurance payments if I wished!

In the eight years that I was a cus
tomer of that bank, I enjoyed the ser
vice. But I can’t remember once hav
ing the slightest question or complaint
regarding how the bank or the creditors
handled my account. One of my col
leagues reported having a minor prob
lem with the bank about the payment
to the telephone company of an un
authorized collect call made by one of
his children’s friends, but an adjust
ment was made on his next statement.
Frankly, the bank could not be faulted
in its procedures for the initial com
plaint, although some saw the incident
as having made possible a situation that
otherwise would have been detected a
week or two in advance.
That college paid its staff, which
mostly was on a nine-month contract, in
12 equal payments because the school’s
experience had been that a number of
of its faculty members had such poor
control of their personal finances that
they didn’t budget properly to cover the
three months of summer recess. The
bank, in receiving the remissions from
the college during each of the three
summer months, expedited a more busi
nesslike payments program, helping
keep down the number of overdrawn
accounts and N SF checks, not to men
tion the elimination of the trauma of ac
count holders that accompanies such
incidents.
This incident is directly related to a
useful and effective development of a
PAP system: the bridging effect be
tween a short fall in income in a period
of seasonal variation and a systematic
approach to meeting the shortfall with
a viable technique. This concept in
volves a planned re-scheduling of a
credit item or a ch ec k deposit, while a
GIRO or debit approach is a re-schedul
ing of the date on which an account is
debited.
One of the problems of the past win
ter has been that with the dramatically
higher prices of fuel and energy, a sig
nificant portion of our population didn’t
have enough savings to meet such a
jump in living expenses. They were not
(Continued on p ag e 113)

MID-CONTINENT BANKER for May 1, 1977

WE SPEAK MONEY IN 90 COUNTRIES
Tariffs, customs and
import Letters of Credit are
some o f the special problems
you face when you’re dealing
with foreign suppliers.
Delays cost you
money so you can’t
afford to let the barriers
of different languages and
currencies slow you up.
That’s why we’ve
established correspondent
bank relationships in 90
countries. Since our
channels are set up in
most countries in advance,
we’re able to have
you doing
business
sooner.
We’ve
had an
International
Department

since 1945—before a lot of
H P banks even projected Kansas
City as a center of international
commerce. Quite naturally 31
years of experience have
helped us streamline proce
dures and in some cases even
rircumvent red tape. We’re
using what we’ve learned
about international busi
ness to keep international
business easier for you.
^
Last year we
Jm handled over $50
^ million in import
Letters of Credit and
that’s just one of the
services we provide.
Our International
| Department is truly
:omplete and, we
might add, good to
work with.
Hk
If you
H P like your
international
business easy, you’ll
like doing business with
United Missouri.

Ik
i UNITED MISSOURI BANK
1 OF KANSAS CITY, N.A.
10th & Grand

(816) 556-7000
Member FDIC

MID-CONTINENT BANKER for May I , 1977

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Federal Reserve Bank of St. Louis

our guarantee
is simple

Conventional methods of planning

normally involve three basic steps.
1. ) The preparation of expensive pre
liminary drawings by an architect;
2. ) your analysis of these plans; and
3. ) the acceptance of formal bids from
one or more general contractors.
Unfortunately, the price often turns out
to be far higher than the original
estimate. . . and you have four ways
to go: back up and start over again;
scrap the whole idea until later; com
promise your original plan by modifica
tion, or bite the bullet and pay the
higher costs. . . hoping of course,
that the final tab will not be even higher.
Bank Building Corporation has a better
way. When you work with us, we’ll

guarantee the total cost of your new
facility before you invest a penny in
expensive working drawings. And if the
completed cost exceeds the price we
guaranteed, you pay only a fraction of
the difference. Bank Building picks up
the rest. And if it costs less. . . you get
practically all of the savings!
There’s not another firm in your city or

in the country that can back up a cost
estimate with a guarantee like ours, and
the only reason we can do it is because
we’ve been in this business for 64 years,
and have planned, designed, and built or
remodeled more than 6,000 buildings.
Our preliminary presentation gives you
complete floor plans; outlines the full
Iscope of work, completion timetable, and
¡¡¡ materials; and color sketches to show
{ I what your facility will look like when
•_ completed . . . and a GUARANTEED
||COST ESTIMATE. We’ll be happy to
v discuss your next facility. We have a

Bank Building Corporation
1130 Hampton Ave.
St. Louis, MO. 63139

MC 577

Please send information about how
you can help build my business.
Name__

k Building
C orporation J L

T itle ___
F irm ___
Address.
C ity ___

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Federal Reserve Bank of St. Louis

I'Ve’ll build you a business.
S tate.

OFFICES: St Louis, Washington, D.C.; Hartford, Conn.;
Chicago, Atlanta, Dallas, Denver, San Francisco

NEWS OF THE

B A N K IN G W O R L D

FROST

BUSCH

• Tom C. Frost Jr., chairman,
FrostBank Corp. and Frost National,
San Antonio, Tex., was elected presi
dent, Association of Reserve City Bank
ers, at the group’s 66th annual meeting
in Phoenix last month. He succeeds
Gabriel Hauge, chairman, Manufac
turers Hanover Trust, New York City.
Richard D. Hill, chairman, First Na
tional, Boston, was elected vice presi
dent. Reelected treasurer was E. Nor
man Staub, vice chairman, Northern
Trust, Chicago.

McDo n n e l l

h es s io n

works within the banking industry to
provide women banking executives
with opportunities for career growth
and increased job satisfaction. The
foundation pioneered the design of a
baccalaureate degree in management
that enables employed women to earn
a degree without career interruption.
This program currently is available at
Simmons College, Boston; Florida State
University, Tallahassee; M u n d e le in
College, Chicago, and Pitzer College,
Claremont, Calif.

• First Union Bancorp., St. Louis,
has two new directors—August A.
Busch III, president and CEO, An
heuser-Busch, Inc., and Sanford N.
McDonnell, president and CEO, Mc
Donnell Douglas Corp., both of St.
Louis.

• Continental Bank, Chicago, has
announced the appointment of Robert J.
Fiddes as trust department representa
tive for the western states, with head
quarters in Los Angeles. Mr. Fiddes
serves in a liaison function between the
bank’s western states clients and its
trust department in Chicago. Adminis
tration of all trust accounts continues
to be handled in Chicago. However,
says Charles R. Hall, executive vice
president and head of Continental’s
trust and investment services, the bank
believes having a West Coast repre
sentative will give it a much closer
presence to its customers and will en
able it to expand on its commitment
to better serve non-Chicago trust ac
counts. Mr. Fiddes joined Continental’s
trust department in 1968.

Prestige
Programs Pay

• Jeanne Hession, senior trust officer
and associate counsel, Boston Safe De
posit & Trust Co., has been appointed
chairman of the board of trustees of
the National Association of Bank Wom
en’s Educational Foundation. She suc
ceeds Ruth I. Smith, executive vice
president, Tower State, Kansas City,
Kan., who resigned to become NABW’s
vice president. Chartered in 1973, the
foundation offers a broad-spectrum pro
fessional development program, which

Specialists in
□ Credit Life Insurance
□ Credit Disability Insurance
□ Personalized Claim Service
□ Sales Training by
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B

BANK LANE SIGNALS, PLAQUES
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AND LETTER-LITES
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L A K E SH O R E M A R K ER S
ERIE, PA. 16512
MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

200 West H iggins Road
S chaum burg Illin o is 60195
312 885 4500

U3.IFE

CREDIT LIFE Insurance Company

Golden Anniversary:

Group Honoring Lindbergh
Led by St. Louis Banker
St. Louis, which received inter
national fame 50 years ago when a
young aviator became the first person
to fly alone from New York to Paris,
will commemorate the event with a
giant celebration May 22. The aviator,
of course, was Charles A. Lindbergh,
and his monoplane was the “Spirit of
St. Louis.”
The celebration is being organized
by the Spirit of St. Louis 1927-1977,
whose president is Clarence C. Barks
dale, chairman and CEO, First Na
tional, St. Louis. This is a nonprofit
organization created by St. Louis-area
businessmen and civic leaders to cele
brate the 50th anniversary of the late
Mr. Lindbergh’s flight.
“Our celebration,” says Mr. Barks
dale, “is being held for all people with
fond memories of Lindbergh as the
world hero in 1927. We have a special
attachment to Lindbergh, and it is with
great pride that we are planning this
celebration. We hope that everyone
will accept our open invitation to come
to St. Louis and celebrate with us.”
The 50th-anniversary celebration is
being held in St. Louis because it was
there that young Lindbergh received
the financial and moral support he
needed to build his monoplane, christen
it the “Spirit of St. Louis” and fly it
alone to Paris on May 20-21, 1927.
The Sunday afternoon and evening
riverfront extravaganza, free to every
one, will be held from 5-9:15 p.m. It

C om m u n ity
In vol v e m e n t

C ha rle s A . L in d b e rg h is p ic tu re d in fr o n t o f
p la n e , " S p ir it o f St. L o u is ," in w h ic h he fle w
a lo n e fro m N e w Y o rk C ity to Paris in 1927.
H isto ric flig h t w ill be c o m m em o ra te d in St.
Louis th is m o n th w ith e n te rta in m e n t e x tr a v a
g a n z a on riv e r fr o n t. Plans a re b e in g m a d e
b y n o n p ro fit g ro u p h e a d e d b y C larence E.
B a rksd a le , ch. & CEO, First N a t'l, St. Louis.

Louis Aviation Award will be given to
an American whose life and career have
contributed significantly to the ad
vancement of flight.
Still another aspect of the 50th-anniversary observance of the Lindbergh
flight will be a four-month tour (JuneNovember) of 80 U. S. cities this year
by a replica of the “Spirit of St. Louis.”
The tour will retrace the route that
Lindbergh, who died in 1974, followed
into 48 states in 1927.
The replica, says Mr. Barksdale, will
be unveiled in St. Louis. The tour has
been made possible by a grant to the
Experimental Aircraft Association Foun
dation (EA A ), Hales Corners, Wis.,
from the Spirit of St. Louis 1927-1977.
Mr. Barksdale explains his group de
cided to make the tour possible as part
of a nationwide campaign to “demon
strate that there is a new spirit of St.
Louis.”

Think Snow?

‘Full Steam Ahead1Call

will include skydivers, aerobatics, a hot
Revives Town's Spirit
air-balloon ascension, wing walking and
other demonstrations of this nation’s
The winter’s lack of snow has
aviation progress. A 30-minute-long
brought about an attitude of pessimism
fireworks display will conclude th e,
among many citizens of Colorado ski
celebration, which is being produced
towns, and Steamboat Springs is no ex
by Famous-Barr Co., St. Louis depart
ception. The mild weather led to a tem
ment store.
porary closing of Steamboat’s ski area,
Another highlight of the anniversary but, thanks to Boutt County National’s
weekend will be a formal banquet for “Full Steam Ahead” campaign, much of
guests from the U. S. and France May that citizen-and-merchant glumness is
21 in the new St. Louis Gateway Con being replaced with a positive attitude.
vention & Exhibition Center. At the
As part of the bank’s campaign, “Full
banquet, the first annual Spirit of St.
Steam Ahead— Steamboat” posters and
buttons have been made available to
merchants, residents and tourists. Even
the community’s youngsters have been
Bank Sponsors Lindbergh Flight Competition
involved in the event. A coloring con
test was conducted to raise money for a
First National, St. Louis, is sponsoring an area-wide essay and model
local school that was destroyed by fire.
display competition in honor of the 50th anniversary of the late Charles A.
Has the campaign been effective?
Lindbergh’s historic transatlantic flight to Paris in the “Spirit of St. Louis.”
“Yes it has, and in unexpected ways,”
The essay contest is open to students in grades 3-12 in the bistate (Mis
says Routt County National President
souri and southern Illinois) area. They will be asked to write a 300-500Del Scott. “Mother Nature seems to
word essay on the theme, “What Did Charles A. Lindbergh’s 1927 Flight
Mean to the World?” Essay entries will be judged in three categories:
have picked up on the campaign, judg
grades 3-6, 7-9 and 10-12.
ing from our recent snowfall!”
The model airplane display contest is for students in grades 1-6. First
National is providing free plastic replicas of the “Spirit of St. Louis”
model airplane kits. Youngsters are asked to assemble the plane and dis
play it in a creative manner by placing the model in an appropriate setting,
on a display board, in a shadow box or diorama. Winners will be selected
on the basis of best display idea and execution and not the display cost
involved.
A panel of outside experts from the fields of aviation, art and creative
writing will judge the entries, with winners to be notified May 12. Winning
essays and model airplane displays will be exhibited in First National’s
lobby May 16-27.
First-, second- and third-place prizes will be awarded in each category,
with a total of 12 prizes. First-place, winners will receive $300 U. S. Series
E savings bonds; second-place winners will get $200 savings bonds, and
third-place winners will be given $100 savings bonds.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Pro S kier H a n k K a s h iw a (I.), p ro m in e n t citizen
o f S te a m b o a t S p rin g s, C olo ., jo in s Del Scott,
pres., R outt C o u n ty N a t'l, in b a n k 's "F u ll Steam
A h e a d — S te a m b o a t" c a m p a ig n
to
overcom e
c o m m u n ity 's w o e s b ro u g h t on b y n e a rly s n o w
less w in te r.

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w
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MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

S e llin g / M a r k e tin g
'Magic Mountain':

Bank's Anniversary Fete
Features Diamond Dig
The diamond anniversary celebration
of Roselle ( 111. ) State really lived up to
its name. Customers transacting busi
ness at the bank during the event were
offered a chance to “dig” for diamonds
in the bank’s “Magic Mountain Dia
mond Mine”!
The “diamond mine” actually was a
replica of a mountain and was on view
in the bank’s lobby. Besides the usual
array of peaks, valleys and so on, this
“mountain” sparkled with hundreds of
rhinestones, among which were 75 real
diamonds. In addition, eight specially
marked rhinestones entitled lucky “min
ers” to a free $75 savings account.
“Mining claims” were issued when
ever a customer made a transaction at
the bank—a deposit, withdrawal, loan

(Advertisement)

Concern for Wildlife
Is Big Business
When the people of Missouri passed
only one statewide tax in 1976, they
confirmed their determination to pre
serve our wilderness. Have you noticed
the number of TV spectaculars, radio
commentaries and the whole new indus
try of magazines, books and newspaper
features devoted entirely to this sub
ject? A concern for our environment is
rapidly becoming one of the most pow
erful voices in our nation.
Until now, there has been little an
advertiser could do to capitalize on this
deep commitment of all the people in
this country.
Just developed, though, is a weekly
series of eye-catching illustrated news
paper columns called, “Your Wilder
ness.” In these columns, offers of spe
cific bank services are combined with
interesting stories of the importance of
wildlife and intriguing puzzles— sure to
get response from readers.
This format, in similar series, has
been acclaimed by customers and bank
ers every time it has been used. “Your
Wilderness” columns, with an unusual
guarantee of readership, are now being
distributed as a syndicated service
through Country Press, Inc., City Bank
Bldg., Suite 301, Div. C, 4625 Lindell
Blvd., St. Louis, MO 63108. Write for
details and samples of this unique
means of creating improved community
involvement.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

C ustom ers o f Roselle (III.) S tate w e re g iv e n
chance to " m in e " fo r o ne o f 75 d ia m o n d s
a m o n g h u n d re d s o f rh in e sto ne s on b a n k 's lo b b y
d is p la y , " M a g ic M o u n ta in
D ia m o n d M in e ."
Here, a ssis ta n t rem oves stone selected b y
custom er.

bank offered a choice of two pounds of
Folger’s coffee or a set of four designer
“cactus” mugs free to each person who
opened a new savings account with
$100 or added that amount to an exist
ing savings account.
Although Chairman Mace Rubinstein
would not divulge the actual amount of
new business generated by the premium
promotion, he says it was “substantial.”
Also, the coffee outperformed the mugs
in popularity by a 2-to-l ratio.
The bank advertised the premiums in
newspapers in the metropolitan Chicago
area, and, according to Mr. Rubinstein,
these ads did a good job of bringing in
people.
River Scenes:

payment, etc. Customers then could
take the “claim” to “Diamond Pete,”
the mining operations supervisor, who
helped each customer stake a claim and
“assay” the stone selected.
The event was a huge success, says
a Roselle State spokesman. Approxi
mately 9,400 mining claims were proc
essed, and 9,300 rhinestones, all 75
diamonds and all eight $75 savings ac
counts were given away.

Mississippi Life Is Topic
Of Bank's A rt Exhibit
An art exhibit and watercolor lec
ture-demonstration by regional artist
James Godwin Scott have been spon
sored by First National, St. Louis.

A Topical Choice:

Bank Seeks New Business
W ith Free Coffee Premium
First State, Alsip, 111., came up with
an extremely topical premium early this
year—coffee. For about a month, the

P ictured w ith his w a te rc o lo r, "S t. Louis S h ip ,"
is a r tis t Jam es G o d w in Scott. The w o r k w a s
u n v e ile d d u rin g a th re e -w e e k e x h ib itio n o f
M r. Scott's w o rk s a t First N a t'l, St. Louis.

A free exhibition of Mr. Scott’s river
paintings was held in the bank’s main
lobby and included Mississippi River
memorabilia. In addition, the artist
held a painting demonstration in a lo
cal park. In that demonstration, he
showed how an artist selects from na
ture when attempting to make a crea
tive statement, choosing as his subject
an array of flowers provided by St.
Louis’ Shaw’s Botanical Garden.
The three-week in-bank showing
consisted of about 30 of Mr. Scott’s
best known watercolors depicting life
on the Mississippi River at St. Louis.
Many of the paintings were shown for
the first time.
MID-CONTINENT BANKER for May 1, 1977

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munity wide participation and recognition, beautifully
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What better way to relate to your community, create
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NAME

T T LE

FINANCIAL INSTITUTION.

w ^ m

CITY___________________________ STATE _ ^ g | ^ ^ p f i Z I P ____________

M Èm Ê

MID-CONTINENT BANKER for May 1 , 1 9 7 7

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

T M - A TRADEMARK AND SERVICE MARK OF RICHARD STEBBINS AND ASSOCIATES, INC.

EFTS

(Electronic Funds Transfer Systems]

Multi-Bank Electronic Network
Is Operational in Kentucky;
Originates in Louisville
L O U ISV IL L E —Kentucky’s first net
work of electronic banking services—
allowing consumers to use their person
al banking cards at other banks’ auto
matic teller facilities—has gone from
the planning to the operational stage.
Called Card Interchange, the net
work now includes three banks—First
National, Louisville; Second National,
Lexington, and Taylor County Bank,
Campbellsville. This spring, two others
will be added—Citizens State, Owens
boro, and Farmers Bank, Madisonville.
In addition, several other banks have
expressed interest in joining the net
work. A First of Louisville spokesman
says Card Interchange has the ultimate
capacity of linking Kentuckians to
some services of their hometown banks
from anywhere in the state.
The network was developed by First
of Louisville, which functions as the

A . Stevens M ile s (r.), pres., First N a t'l, Louis
v ille , a n d J. H. G ra ve s, pres., Second N a t'l,
L e x in g to n , p o in t to C ard In te rc h a n g e sym b o l
K e n tu ckia n s sh ou ld lo o k fo r w h e n n e e d in g 24h o u r b a n k in g a w a y fro m hom e. First o f Louis
v ille is d e v e lo p e r o f C a rd In te rc h a n g e n e tw o rk ,
a n d Second N a t'l is o ne o f firs t tw o K e n tu cky
b a n k s to jo in p ro g ra m .

“transmittal’ or “originating” bank.
The Card Interchange symbol appears
on all automatic tellers of all participat
ing banks, permitting customers to rec
ognize units at which they can do their
electronic banking while out of town.
The procedure customers use to
withdraw funds from participating
banks’ automatic tellers is identical to
that of their own bank’s automatic
tellers.
First
of
Louisville’s
president,
A. Stevens Miles, points out that, while
banking still is a long way from the
checkless society, this new network
overcomes a problem almost all Ken
tuckians have faced— obtaining cash
from their checking accounts at any
time of the day or night while out of
town. He foresees expanding the net
work’s services in the future to include
such additional services as deposits and
transfers of funds from one account to
another.

New Computer Services Offered
To Businesses by HC's Banks
ST. LO U IS— Mercantile Bancorp.,
bank HC headquartered here, last
month announced that all 28 of its
banks now offer three major new com
puter services to small and moderate
sized businesses throughout Missouri
and bordering states.
Mercantile is offering computer ser
vicing of accounts receivable, accounts
payable and general ledger accounts
in a joint program initiated with Auto
matic Data Processing, described as the
largest data processing system in the
country. This firm is headquartered in
New Jersey, with Missouri offices lo
cated in St. Louis and Kansas City.
“This is part of Mercantile’s continu
ing effort to provide complete capa
bilities to businesses with sales in the
$l-million-to-$ 10-million range, giving
them access to services not otherwise

FARMERS GRAIN AND LIVESTOCK

available without purchasing costly
electronic equipment,” says Jerry Gold
stein, a vice president of the HC’s lead
bank, Mercantile Trust, St. Louis. “By
putting their accounts receivable, ac
counts payable and general ledger ac
counts on a computer, these businesses
can achieve internal operating efficien
cies, reduce costs and improve their
levels of control.”
Mercantile already is marketing a
wide range of services for small busi
nesses, including cash management and
payroll servicing. Both Mercantile Trust
and ADP continue to market their own
payroll systems independently.

Visa Internat'l EFT System
Put in Operation April 4
SAN FRANCISCO— A global elec
tronic funds transfer system, said to be
the first of it kind, went into operation
April 4. Visa members in the U. S. and
16 other countries began interchanging
transaction data electronically through
a system operated by National BankAmericard, Inc. (N B I).
Called BASE II International, the
system initially links 20 card-processing
centers located overseas to the 96 cen
ters in this country. Through it, mem
ber banks transmit credit and debit in
formation for card-holder billings as
well as data for interchange settlements
among themselves.
Inauguration of the international net
work coincides with global adoption of
the Visa name to simplify and strength
en recognition worldwide. Overall, it
will reduce international clearing costs
for member banks to about a third of
current levels, estimates D. W. Hock,
president of NBI & Ibanco, Ltd., which
administers the Visa card system world
wide.
The new system will become fully
operational by July 1.

The Marketing Advisory Service

FGL Will Help You . . . 1 . Increase the volume of your loan portfolio.

2. Increase profitability and stability.
3. Develop credibility and leadership in the ag community. 4. Provide marketing expertise to your Clients.

GIVE FGL A CALL . . . (515) 223-2200
1200 35th Street, West Des Moines, Iowa 50265

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

^ MID-CONTINENT BANKER for May 1, 1977

“I’ve used every correspondent
service F irst N ational offers.
A nd after 35 years, success
has proven the wisdom o f i t ”
The Farm ers Bank of
Clinton, Missouri is a true
success story. A correspondent
relationship with First National
Bank of Kansas City has given
it valuable extra time and
expertise to concentrate on
serving its growing community.
Mr. and Mrs. Harry Finks, Jr.,
president and vice president,
know that size determines a
bank’s method of o p e r a tic r a s y ^ ^
Farm ers Bank has the advantage
o f a community where e a f l H j H
client and his business n e l m ^ " ™
are known intimately.
But the community is not
large enough to support a
computer and specialists for ,
just one bank’s daily needs.
Ten years ago, H arry Finks,
already established in full
correspondent relationship with
the First, was one of the first
to take advantage of our
computers and other related
specialized services.
F o r his dema^nd deposits,
savings acco u n t^ ai^ W ü ficates
of deposit, d^^SH M K ^pts
from the First save his people
time and help insure accuracy.
If your bank could benefit
from assistance with overline
loans, investments, transit
collection, bonds, international
services, trusts, cash manage
ment and other financial
services, call the professional
staff of the First National Bank
Correspondent Department. ' M
We take pride in the
success of the Finks and the
Farm ers Bank of Clinton. Our
correspondent banking tradition
has been built on help like this.
Why not put our Strong

tradition o f excellence to work
for your success.

Harry Finks, Jr., Puf^idéht

F armqp- Santi &?tHWon
WilliaÄO. w m j?vs($Ê Ê ïïm *Ë

’fo u r success is o u r trad itio n .

First
.
National

O r j l ^ l^of KANSAS CITY.
O d i UVMISSOURI
An Affiliate o f First National
Charter Corporation

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

. . .
m i/ Member FDIC

WeVc the hack office
for the front-runners o f
Am erican hanking.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

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MID-CONTINENT BANKER for May 1, 1977

O p e r a tio n s
Bank Can M o n ito r Rem ote Branches
W ith S tatew ide Security N etw ork
SEC U RITY NETW ORK linking all
of Maryland National’s branches
and facilities is being installed and will
go into statewide operation early in
1978.
Reputedly the world’s largest, this
$ 1-million, bank-owned p r o p r ie ta r y
branch-monitoring system—designed by
Mosler Safe Co., Hamilton, O.—will
protect more than 150 remote banking
locations. It will replace formerly leased
outside security services and will en
able the bank’s own security personnel
to monitor scheduled bank operations
and detect criminal or emergency situ
ations on an around-the-clock basis.
From the bank’s centrally located se
curity console, trained operators will
be able to identify accurately various
alarm indications and immediately initi
ate law-enforcement responses to situ
ations occurring in branches anywhere
from the tip of the eastern shore to the
mountains beyond Hagerstown.
According to Richard T. Davis, as
sistant vice president and head of the
bank’s security and protection depart
ment, this capability for rapid remote
reportings and reactions— even from
160 miles away— adds new dimensions
in protection for bank personnel and
customers, as well as for monies and
valuables on hand.
“One of the major advantages of this
new system,” says Mr. Davis, “is its
ability to furnish up to 10 different and

discriminating reportings from each
branch bank. We can tell immediately
what kind of situation exists, whether
it’s a holdup attempt or if someone’s
actually trying to burglarize a vault,
open a night depository or tamper with
our phone lines and alarm circuits. Day
or night, we can identify an unautho
rized or illegal entry, when a door’s left
unlocked or even know when our night
cleaning people enter or leave.
“And, because we can precisely dis
tinguish critical alarms, we can better
initiate the proper type of police re
sponse when necessary, with minimal
delay and far less opportunity for either
physical danger or property loss. So this
affords greater safety and protection at
every one of our facilities and, most
importantly, for everybody in them.
This modern branch-monitoring system
also virtually eliminates another bank
ing headache: calling out a valuable
police unit to answer a false alarm.”
M a ry la n d N a tio n a l’s e x te n s iv e
BRM -X branch-monitoring system uti
lizes modern multiplexing techniques
and equipment that transmit, receive
and report at millisecond speeds. It
consists of three major elements: the
regionally zoned and computer-assisted
display at the central console monitor;
a security transmitter at each remote
location and an advanced data-gathering telecommunications network. This
latter system, engineered with the close

This is s e cu rity console o f M o sle r BRM-X b ra n c h -m o n ito rin g system , w h ic h M a ry la n d N a t'l is
in s ta llin g in b ran ch e s across sta te . From th is c e n tra lly lo ca te d console, tra in e d o p e ra to rs w ill
be a b le to id e n tify a c c u ra te ly v a rio u s a la rm in d ic a tio n s a n d im m e d ia te ly a le r t la w -e n fo rc e m e n t
age n cie s to s itu a tio n s o ccu rrin g in b ran ch e s a n y w h e re in M a ry la n d .

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

cooperation of the Chesapeake & Po
tomac Telephone Co., features a new
“touch-dial” technique that enables the
console operator to initiate coded,
single-digit telephone connections to up
to 31 preselected numbers almost in
stantaneously.
In addition to the security that the
new system will provide, the bank also
cited flexibility and cost economies as
reasons for implementing the M osier
BRM -X remote monitoring system. In
recent years, the $2-billion-deposit
Maryland National has been opening
or acquiring an average of six new
branch locations annually. Now, antici
pated growth in any area can be ac
commodated easily because the new
security installation is expandable to
well over 250 separate locations. Oper
ations officers expect the bank-owned
system to pay for itself rapidly in terms
of more complete and uniform ad
ministrative control and reduced oper
ating, service and maintenance expendi
tures.
Mr. Davis also points out that the
bank’s new security network doubles
the information formerly transmitted
from remote locations and, with its ad
vanced communications system, can
offer an estimated 70% cost savings
over conventional reporting methods.
He also favors the new BRM -X system

because it interfaces with its own com
puter for routine branch-status anal
yses, personnel updates, event sum
maries, etc., but doesn’t depend on
computerization to maintain continu
ous protection. While teletypewriter
and CRT readouts usually will be avail
able immediately to security super
visors, the Mosler BRM -X system will
operate fully independently during any
computer or other power outage.
“When all 150 or more branch offices
and buildings are protected by this
statewide system next year,” Mr. Davis
says, “we feel we will have rounded
out a program of total security quite
consistent with Maryland National’s
forward attitude toward financial, em
ployee and customer responsibilities.”

Alabama Trust School July 17-23;
Open to Out-of-State Bankers
BIRMINGHAM— The fifth annual
session of the Alabama Trust School
will be held July 17-23 at Birmingham
Southern College here. The school,
which is open to banks in neighboring
states as well as those in Alabama, is
sponsored by the Alabama Bankers
Association’s Trust Division.
The three-year school consists of 39
hours of classroom instruction, aug
mented by special lectures and discus-

Mercantile Buys Tower
ST. LOUIS—Mercantile Trust last
month announced that it has pur
chased the interests of its joint-ven
ture partners in Mercantile Center
Associates, Crow, Pope & Land En
terprises of St. Louis.
“As a result of this action,” says
Mercantile’s chairman, Donald E.
Lasater, “Mercantile Trust Co. now
is the sole owner of both Mercantile
Center Associates, which holds title
to the Mercantile Tower and the ad
joining garage, and also of the Mer
cantile Center Redevelopment Corp.,
developers of the six-block, multi
use complex in downtown St. Louis.”
Amount and terms of the purchase
were not disclosed.

sion groups. Diplomas are issued on
completion of the third year.
Registration fee for each one-week
session is $200, which includes tuition,
room and board. Application forms and
registration fees must be submitted by
June li
For application forms and further
information, write: Coordinator, Ala
bama Trust School, P. O. Box A-6,
Birmingham Southern College, Bir
mingham, AL 35204.

How much new business
does your present
Christmas Club generate?
If your present Christmas Club isn’t attracting as many
new customers as you would like, maybe it’s outlived
its usefulness. If that’s the case, why not look into an
attractive and practical Christmas Club program from
Rand McNally. You’ll find that they have all the innova
tive ideas, materials and know-how needed to help
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C lu b ... including some cost-saving features you can’t
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A name you know,
a company you should know more about

Rand M9Nally
F inancial S ystem s D ivision
P.O. Box 7600 / Chicago, Illinois 60680 / (312) 267-6868
10 East 53rd Street / New York, New York 10022 / (212) 751-6300
206 Sansome Street / San Francisco, California 94104 / (415) 362-4834

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

Now! A new CLIC program
to help you minimize apartment and
commercial mortgage risk.
“Even on a clear day no one can
see forever”. . . that’s C L lC s new
back-to-basics approach to
Com m ercial Mortgage Insurance.

Four centuries ago, W illiam Shakespeare said, "What's past is
prologue." In modern terms, this means that experience of the
past usually leads to the beginning of something new.
At CLIC, we feel that phrase aptly describes what is now
occurring in the apartment and commercial lending industry.
The experiences of 1974 and 1975 clearly indicate that no
commercial mortgage loan is insulated from the cyclical
aberrations of the nation's economy and their effect on local
markets, no matter how prudent the lender and sound his
underwriting may be.
At CLIC, we have spent a full year studying and re-evaluating
the role of commercial loan insurance and the benefits it brings
to the lending industry. The result is a new program that allows
lenders to capitalize on CLIC's experience— to enjoy the higher
yield of commercial mortgage loan lending while minim izing
risk.
Full details are available in a simple booklet that is yours free.
Simply use the coupon below or call 800-558-9900,
Extension 6815. In Wisconsin 800-242-9275.

CUC

Commendai M ortgage Irtsuran«W ritten by Commercial Loan insurance Corporation
A M em ber o f th e MGIC Investm ent Corporation Family

Send for free booklet explaining the new C LIC program. Use the coupon below:
Please send me a copy of your brochure describing the new CLIC program.
Name____________________________________________________________
Title______________________ ________ ______________________________
Firm_____________________________________________________________
Address__________________ _________ ___________ __________ ________
City____________________________ State____________ Zip_____________

CLIC

Commercial Loan
Insurance Corporation

”

A mem ber of the
M G IC Investment C orporation Family
M G IC Plaza
Milwaukee, Wisconsin 53201

Telephone________________________________________________________

MID-CONTINENT BANKER for May 1, 1 9 7 7

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

You’ve got one good reason to consider
secured lending...

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

The most important reason, of
course, is profit. You don’t want to lose
your profitable customers or pros
pects should they require a secured
loan. But you can't ignore the fact that
secured lending diverts your time and
resources from your basic business
and, unless you nave a highly quali
fied staff, can become risky. However,
there’s a profitable and efficient way
to avoid these problems... participate
with Heller.
In a manner of speaking, our
staff will become your secured lend
ing department.They are not only
experts, they are the experts in
secured lending.. .the most experi
enced, and very likely, the best in the
business. With over a half-century in
the secured financing business, Heller
people pioneered many of the modern
lending techniques.
It’s with this experience that
Heller people today perform eight
essential functions necessary in ad
ministering your secured loan. While
your staff concentrates on your pri
mary banking business, Heller is
performing the following services to
protect your bank’s dollars.

\4
r
.
Reconciliation of
Agings.
Each month Heller determines which
of a borrower's invoices represent
eligible collateral. What differentiates
our operation is that we evaluate the
individual pieces of collateral in
terms of their "real dollar” value, as
opposed to computing their eligibility
through some calendar-orientea,
mathematical formula. Yet, our
approach is positive, keeping a deli
cate balance between your collateral
protection and accommodation to
your customer’s needs.

MID-CONTINENT BANKER for May 1, 1977

and a l least eight good reasons lo consider
participating with H ellec
Supplemental Loans.

Field Examinations.

To maximize your customer’s borrow
ing capacity, a secured loan may
include inventory and/or chattels
as well as accounts receivable.
But additional
controls are
needed. We
revolve
our in
ventory
loans

Field examiners conduct audits in the
borrower’s place of business at 90 to
120 day intervals. Each is Hellertraineef to rationalize the figures, as
well as balance them, and their
reports often highlight correctable
"conditions” before they become
serious problems. Your bank receives
copies of their
reports.

Processing.
control them daily, not
monthly. Our inventory analysts
understand "auction values, and
physically check beyond a book
keeper’s in-and-out tallies. Chattels are
evaluated by specialists in machinery
and equipment.

Verification.
Frequent telephone verification of
collateralized receivables checks
their authenticity, amount and terms.
This way, exceptions can be per
sonal ly and considerately resolved—
something computers can never be
taught to do.

Credit Administration.
Our account executives keep a com
plete up-to-the-minute picture of the
borrower’s financial position, care
fully following trends affecting col
lateral and operations.Typically this
continuous review leads to a reduction
in bad debt expense, as our record
demonstrates.

LegalWork.
While mindful of their obligation to
protect the legal positions of both
Heller and the bank participant, our
attorneys are also business-minded.
They seek ways to make a safe loan,
drawing upon their experience to
avoid qualifications that may sour
the dealings.

In fairness to your customer, it is
Heller’s policy to process disburse
ments or pay-downs respecting the
customer s loan on the day we receive
the collateral or payments. Our years
of experience permit instant atten
tion without undue risk.

More and
more banks
are entering
into secured
lending through
participations with
Heller. It's an extraor
dinary business relation
ship. Your customer's financial needs
are served. You keep your customer,
continuing to provide his normal
banking functions, while you generate
interest income from your portion of
the loan. And you have the comfort of
knowing Heller is protecting your
investment. Heller has lending
partnerships with banks of alfsizes—
from those with under $20 million in
deposits to many of the nation’s 25
largest banks. Find out what they’ve
found out about this marketable,
profitable lending concept. Call
Heller today.

HELLERS
Financial Services m m m

Liquidations.
Yes, occasionally they happen. What
follows is the complex ana demand
ing period called a “ workout','a time

MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

when only the specialized experience
of the lender and cool determination
to "see it out” can prevent a loss.
Heller’s record in handling these
situations, like our general expertise
in secured lending, is probably the
best in the business.

Walter E. Heller & Company 105 W. Adams St.,
Chicago, 111.60603 • New York • Boston
Philadelphia • Baltimore • Syracuse • Detroit
St. Louis • Charlotte • Kansas City • Denver
Atlanta • Miami • Birmingham • New Orleans
Houston • Dallas • Phoenix • Los Angeles
San Francisco • Portland • San Juan RR.

Heller services also available through
Heller Companies in Canada and twenty other
countries around the world.

Manufacturers Hanover
Cash Letter Express Services
speed up your cash flow.

advise you of date
and time of receipt,
confirm totals and
major return items
of the previous day.

Funds available
faster.
Manufacturers
Hanover has its own
ways to convert in
transit items into
cash—fast. Just as
we do it for our
selves, we do it for
our correspondents.
And we do it all —
sorting, bundling,
collecting and
crediting.

The Early Bird
delivers.
To beat traffic, we
use helicopters to
speed your checks
from the airport to
our processing
center. At our
. This gives
you more time
to meet the
deadline

for converting late
items into “g o o d ”
funds.

Control over
funds.

MHT does the work,
but you’re in full
control of your
funds at all times.
We provide daily
verifications via
bank wire or phone,

Low Costs.
Because we com
pute our Earnings
Credit Rate differ
ently from many
other New York City
banks, we keep
balance require
ments down. Thus
your net costs are
unusually low for
superior service.

For more details
and our latest avail
ability schedule,
contact our Cash
Letter specialist,
Ronald R. Pabian,
Manufacturers
Hanover, 350 Park
Avenue, New York,
N.Y. 10022.
(212) 350-4107.

MANUFACTURERS HANOVER
Member FD1C

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1 977

Sfage being set tor legislative action
On NOWs, interest payment on reserves

o v e r n i g h t , ¡t seems,
the question of payment of inter
est on some type of demand deposits
has moved to the front legislative burn
er in Washington, becoming a national
issue of concern to all bankers. Yet this
issue has been building impetus for
seven years or more.
The issue has many labels—“NOW
(negotiable order of withdrawal) ac
counts” and “interest-bearing consumer
transaction account” being the most
prominently mentioned. Regardless of
what these new types of accounts are
called, it’s clear that Congress intends
to make a major effort to legislate them
into existence nationwide—for both
banks and S&Ls—sometime this year.
As of this writing, neither the specifics
of such legislation, nor its possible
schedule, are known. While some ob
servers doubt that such a bill could
pass Congress at present, few believe
it could be held off indefinitely.
In the meantime, Fed Chairman
Arthur F. Burns has publicly declared
his preference for nationwide NOW ac
counts, combined with payment by the
Fed of interest on the required reserves
it holds. The American Bankers As
sociation, at a late-February meeting,
declared its intention to seek a con
structive solution to the question of
payment of interest on consumers’
transaction balances, rather than to
wage an all-out war of opposition to
any and all such proposals.
How have NOW accounts relatively
and suddenly changed from a New
England issue to a question concerning
bankers in every state? A review of
recent history underscores the trend—
hitherto often unnoticed by bankers
outside New England—toward some
sort of nationwide payment of interest
on transaction balances. As scrutiny of
the events listed below shows, the
erosion of prohibition of payment of
interest on demand deposits and a
trend toward the offering of third-party

lm o st

Special to MID-CONTINENT BANKER

payment services by thrift institutions
began slowly some years ago but has
accelerated ever since:
• In 1970, S&Ls were permitted to
make pre-authorized transfers from sav
ings accounts in payment of various
household-related expenses.
• In 1972, state-chartered mutual
savings banks (M SBs) in Massachu
setts were authorized to offer NOW ac
counts. A few months later, New
Hampshire followed suit.
• In 1974, Congress authorized all
depository institutions (except credit
unions) in Massachusetts and New
Hampshire to offer NOW accounts. In

States in which thrift institutions
may offer checking or NOW accounts

State

Connecticut MSB/S&L
MSB
Delaware
Illinois
MSB/S&L
Maine
MSB
Maryland
Massachusetts
CU
Nevada
New Hampshire
MSB
New Jersey
MSB/S&L
New York
N. Carolina CU
MSB/S&L*
Oregon
Pennsylvania
Rhode Island MSB/S&L/CU
CU
Utah
MSB
Vermont
Wisconsin
*

NOW or
NIN0W+
MSB/S&L
S&L+
MSB/S&L
MSB/S&L/CU
MSB/S&L

MSB+
MSB/S&L
MSB/S&L
S&L**+

Not effective yet
In litigation
+ Non-interest-bearing NOW acct.
MSB— Mutual savings bank
S&L— Savings & loan assn.
CU — Credit union
**

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Checking
Accounts

the same year, shareholders of money
market funds were allowed to write
drafts (or checks) against their ac
counts. Credit unions were granted au
thority to offer share-draft accounts, the
equivalent of NOW accounts or check
ing accounts that pay interest. Banks
were permitted to accept savings de
posits from state and local governments,
something the thrifts already were al
lowed to do.
• In 1975, banks were authorized to
transfer funds from savings accounts to
demand deposits by telephone order
(again, balancing powers already grant
ed to thrifts). Authority of S&Ls to
make pre-authorized transfers from sav
ings accounts was extended to cover
any type of payment, and similar au
thority was granted to banks. In the
same year, banks also were authorized
to offer savings accounts, to a maxi
mum of $150,000, to business firms.
• Finally, in 1976, Congress passed
legislation permitting NOW accounts
for all depository institutions (except
credit unions) in all six New England
states.
To summarize those events, NOW ac
counts were an invention of state legis
latures and regulators originally in
tended to benefit thrifts. Only later
were they expanded by Congress to
banks in an effort to balance the pow
ers of competing financial institutions
within the New England region.
Although debate on the question of
interest-bearing consumer transaction
accounts now is dominated by events
in Washington, it’s important to re
member that the origins of this national
debate go all the way back to statelevel competitive, regulatory and legis
lative initiatives. Such evolutionary pro
cesses have been described as “potboil
ing”—permitting new powers for statechartered institutions, which causes ex
tension of those powers to federal in
stitutions.
By the same token, potboiling be-

tween thrift institutions and banks also
has been effective. Either way, pot
boiling within a state or region can
quickly lead to pressures in adjoining
states or regions for similar changes.
Recent changes in New York help
illustrate the potboiling process even
more clearly:
• In May, 1974, several MSBs in
New York introduced “payment or
ders,” check-like instruments, and se
cured the State Banking Department’s
approval of the new service.
• A suit filed by the New York State
Bankers Association and three of its
members in July, 1974, resulted in a
court ruling that state law did not au
thorize MSBs to offer such services.
• The New York legislature, how
ever, enacted a law in 1976 to grant
demand-deposit powers to state-char
tered thrifts. In early April of this year,
Congress nearly passed, but finally re
jected, a move to grant checking-ac
count powers to federal S&Ls in New
York state.
Nevertheless, through potboiling and
an increasingly powerful combination
of competitive and political forces, in
terest on demand deposits undeniably
has become a national issue.
Certainly by 1976, it was clear that
payment of interest on some form of
checking accounts soon would become
a major national issue for bankers. Last
September, having found that interest
on demand deposits had become a
stumbling block for certain pieces of
legislation, leadership of both the
House and the Senate Banking com
mittees asked the Fed to conduct a
study of the probable impact of pay
ment of interest on demand deposits
and report back to the 95th Congress
by February 1 of this year.
The Fed’s staff study was completed
on schedule and forwarded to Con
gress. Although as of this writing the
Fed’s Board of Governors has made no
formal recommendation to Congress re
garding interest on demand deposits,
the Fed’s staff has been working with
the congressional staff on a possible
legislative package.
Among other things, the Fed staff
study reported that payment of interest
on demand deposits is likely to lead to
the pricing of bank services more near
ly in line with costs. (In that regard,
other studies have shown that the costs
of so-called free checking accounts
often equal 20% or more interest on
balances in those accounts.) The study
noted, too, that the ban on interest on
demand deposits has been eroded by
developments in financial markets al
ready described above.
The Fed staff predicted that such
payment of interest would temporarily
reduce bank earnings by 5 to 20% of
pretax earnings during the worst year

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

of a transition period. The impact of
such a change would be lessened some
what, the study said, if both banks and
thrifts nationwide could offer NOW
accounts only to individuals and non
profit organizations. (Since then, Chair
man Burns has said he would prefer
offering NOWs only to individuals.)
Banks with both relatively low earn
ings and relatively large amounts of
deposits that were potentially subject
to a switchover to NOW-account status
would encounter the most difficulty in
adjusting to removal of the prohibition
of payment of interest on demand de
posits, the Fed staff reported.
The study report suggested that pay
ment of interest on required reserves
held by the Fed could offset part of
the cost impact of nationwide imple
mentation of NOW accounts. And it
said there should be uniform reserve
requirements on such accounts, with all
those reserves held at the Fed. The
study also predicted that interest on
demand deposits would not have a sig
nificant effect on interest rates in credit
markets.
What does the future hold? At a
February leadership meeting, which in
cluded the ABA’s Governing Council,
Government Relations Council and the
leadership of all 50 state bankers as
sociations, the ABA rejected the con
cept of straight elimination of prohibi
tion of payment of interest on demand
deposits. However, the ABA did de-

clare its intention to search for a con
structive solution to the question of
payment of interest on consumers
transaction balances.
Will this issue ultimately be linked
to payment of interest by the Fed on
required reserves? Chairman Bums spe
cifically has stated that the two issues
must be considered together, but for
bankers it may be easier initially to ex
amine the two issues separately. The
ABA has described it this way: “Two
separate—but many-sided—issues con
front bankers: first, direct and open
payment of interest on a new class of de
mand-type deposits, theoretically bal
anced by realistic (and increased) service
charges; and second, payment of in
terest on Fed-held required reserves,
seen by some as a possible solution to
the Fed’s membership problem, by
others as a potential disruption of cor
respondent relationships.”
“For bankers, as for other groups
which would be affected by such legis
lation,” the ABA said, “the need now
is to seek to resolve divergent opinions
and arrive at some consensus— especial
ly in light of competitive inroads made
recently by nonbank financial institu
tions and organizations.”
In that connection, the ABA sched
uled a second leadership meeting for
late April to continue the process of
building an industry-wide consensus on
the question of payment of interest on
a new type of demand-deposit account.

Dem and-Deposit Interest Paym ent Im pact
Could Be Serious on Independent Banks
By CHARLES O. MADDOX JR.*
President
Peoples Bank
Winder, Ga.

NTEREST-generating
NOW
ac
counts could have the most serious
impact of any de
velopment in the
past 50 years on
the
manner
in
which our banks
are operated.
I have been in
contact with New
England
bankers
for over a year
and a half, secur
ing data on the
impact of demand-deposit interest.
Contrary to public assertions that the
experimental NOW account program
was having a minimal effect on com
mercial banks, I found that the impact

of payment of interest on demand de
posits was in direct proportion to the
percentage of demand deposits to total
deposits in each bank.
Where a large percentage of demand
money was rapidly converted from
personal checking accounts to NOWs,
the impact of the additional expense
to the bank approached disastrous pro
portions.
One New Hampshire banker, with
whom I discussed the detailed break
down of profit-and-loss, indicated a
drop in earnings of 52% from the pre
ceding year. This drop was directly at
tributable to interest payments on
NOWs.
Anyone feeling that demand-interest

* Mr. Maddox is immediate past
president, Independent Bankers Assn,
of America. This article is based on
remarks made by Mr. Maddox at the
recent IB AA convention in Washing
ton, D. C.

MID-CONTINENT BANKER for May 1, 1977

accounts will not have a material im
pact on their bank should multiply
their demand funds by 2% or 3%. In the
case of my bank, payment of interest
on demand funds at a 3% rate would
have resulted in a loss last year.
When considering the impact of in
terest on demand deposits, we must
realize that Congress can’t be primarily
concerned with whether we as inde
pendent community banks—or even
commercial banks as a whole—make
a profit. However, Congress should be
vitally concerned with the disastrous
results of the action it contemplates.
Interest on demand deposits would
trigger a great variety of problems, not
only for commercial banks, but for all
members of the financial community
offering NOW accounts.
History gives us a perfect example
of the problems brought about by in
terest paid on demand funds. In the
1920s, interest paid on such deposits
was 5%, 6% and 7%. If we are going to
take on this kind of expense, we would
be forced not only to change our loan

ratios, but to change the criteria used
in evaluating the quality of the loans
we make. With the dog-eat-dog ap
proach of everyone chasing after the
deposit bone, we soon would encounter
the same problem already showing up
in New England: Banks fully realize
it is unwise to pursue interest-paying
demand deposits but they are forced
to do so to maintain their deposit bases.
The second and most disturbing ele
ment about demand-deposit interest is
the lessening of liquidity it would
cause in our banks, both because of the
higher percentage of loans we would
be forced to make to cover the interest
payments and because of the poor loan
quality that would result. This would
create added problems for individual
banks and regulatory bodies.
A final detrimental effect of demand
interest would spring from the fact that
the increased costs must be absorbed
either by the banks or charged to the
consumer. If capital supplied by earn
ings became deficient in the judgment
of regulatory authorities, we would be

involved in an additional equity-capital
problem.
It’s estimated that an interest-rate
increase of between 2% and 3% must be
put into effect as a partial offset to the
added expense of demand deposit in
terest. One need only look at the size
of one’s average account to see that the
net result of such a move would be a
small return to the average checking
depositor. The lion’s share of the inter
est would go to large depositors. In
evitably, rates on all loans would go up
substantially.
During visits to Canada and En
gland, I discussed the impact of de
mand-deposit interest on the rates
bankers there must charge. In Canada
the savings rate is from 9% to 12/2% and
the rates charged customers range from
13% to 16%. In England a savings rate
of 12% to 15% is paid and charges to
customers run from 17% to 22%.
I am at a loss to understand those
who would take us down the same
road. * *

Mid-Continent-Area Bankers Oppose NOWs,
Say Customers W ill Have to Pay for Them
Chief executives of state associations present views
Demand-Deposit Interest
Objected to Strongly
By Missouri BA Pres.
Strong opposition to the proposal
that commercial banks could or should
pay interest on checking accounts
across the board is expressed by
Charles K. Richmond, president, Mis
souri Bankers Association, and vice
chairman, American National, St. Jo
seph, Mo. Mr. Richmond stresses the
fact that his views are personal and do
not represent those of the MBA, since
the association’s board has not formal
ly taken a position on the issue.
“I believe that paying interest on
checking accounts is an unsound bank
ing practice and I think banking’s ex
perience in the ’20s and early ’30s
testifies to that fact,” Mr. Richmond
said.
Staff economists on congressional
committees and some regulatory groups
and other professional economists seem
intent on building a case for payment
of interest on demand deposits, he said.
They write off the experience of the

past, sometimes in one brief paragraph,
explaining that the prohibition of inter
est on checking accounts in 1933 was
a trade-off to get federal deposit insur
ance approved.
“I have a strong feeling that most
bankers who were on the line back in
those days would be opposed to the
current trend. Maybe there are more
lessons to be remembered from that
period than are being mentioned now,”
he continued.
Another principal reason for Mr.
Richmond’s opposition to payment of
interest on demand deposits is the se
vere impact on bank earnings it would
have, Mr. Richmond said, particularly
for the smaller banks. He said it is be
ing suggested that the Fed pay interest
on reserve balances to help offset the
increased costs banks face when paying
demand-deposit interest, but that will
not help many small nonmember
banks.
“Raising service charges on checking
accounts to a figure more in line with
actual costs will help offset the new in
terest expense,” he said, “and also rais
ing loan rates could be a source of ad

MID-CONTINENT BANKER for May 1 , 1 9 7 7

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

ditional offsetting revenue. These de
velopments very likely would be to the
detriment of the small- to mediumbalance customer.”
Such a proposal would not help the
average consumer, he said, which
means it is ill-conceived. The affluent
customer will benefit from the interest
paid at the expense of the small- to
medium-balance customers whose aver
age collected balance might earn insig
nificant interest but whose service
charges might be increased significant

ly*

“This same customer is likely to be
an installment borrower where, again,
he might have to help pay the tab
through higher loan rates,” Mr. Rich
mond said. “A proposal that would so
drastically increase costs and reduce
profitability at a time when strengthen
ing capital and reserve accounts is be
ing strongly promoted by bank regula
tors seems to be in direct contradition
to the regulator’s stance.”
Mr. Richmond said he is sure there
are many banks without computerized
checking accounts. It occurs to him
that it would be a horrendous job to

"It is quite obvious that neither the mutual savings banks, S&Ls
nor the credit unions feel they should have to adhere to the
original purpose for which they were established."

handle interest on regular checking
accounts or NOW accounts if it were
done manually. Some of the banks lo
cated in areas where transportation to
a computer center is a problem could
find themselves in a difficult situation.
“As for the much publicized NOW
account,” he said, “it is basically
equivalent to an interest-bearing check
ing account with one significant differ
ence—the reserve requirement is low
er. I am opposed to nationwide NOW
accounts for the reasons stated above.
I would point out, however, that the
proposal under consideration, as I un
derstand it, provides only for house
hold accounts at an interest rate some
what less than the present maximum
of 5%. Also, the establishment of a
NOW account apparently requires cus
tomer initiative. The NOW account
would impact earnings to a lesser de
gree than across-the-board payment of
interest on demand deposits.”
The question usually arises who or
what is the force behind this NOW ac
count movement and the answer is
somewhat vague, Mr. Richmond said.
Mentioned for varying reasons are pro
fessional and congressional staff econo
mists, certain consumer advocates, the
Fed and large thrift institutions.
“I believe the overriding force is the
desire of the large thrifts to provide
third-party payment power to their cus
tomers and thereby try to increase their
share of the market,” he said. “It is
quite obvious that neither the mutual
savings banks, S&Ls nor the credit un
ions feel they should have to adhere
to the original purpose for which they
were established. They want to expand
into other financial areas without the
constraints imposed on banks while re
taining the advantages allowed them
initially.”
W e are being told by such promi
nent lawmakers in Washington as Sen
ator Thomas J. McIntyre (D.,N.H.)
that NOW accounts are inevitable, Mr.
Richmond said. Fed Chairman Arthur
Rurns has implied the same inevitabili

ty“I am not convinced that they are
or need be inevitable,” Mr. Richmond
said.
Mr. Richmond listed several alter
nate positions that the ARA has sug
gested:
• Oppose the payment of interest

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on checking accounts in any form, in
cluding NOW accounts.
• Oppose payment of interest on
demand deposits but support the
spread of NOW accounts.
• Support payment of interest on
government deposits only.
• Oppose payment of interest on
checking accounts, including NOW ac
counts, but support pre-authorized
transfers between demand and time
deposits.
• Support payment of interest on
checking accounts, including NOW ac
counts, only if interest is paid on re
serves kept in Fed banks.
• Support payment of interest on
checking accounts if interest limitations
are set at low levels and gradually in
creased only after it has been deter
mined that there has been no damage
to the industry.
• Support a gradual phase-in of in
terest on checking accounts only if in
terest is paid on reserves kept at the
Fed.
• Support payment of interest on
checking accounts only if all usury ceil
ings that affect commercial banks are
removed.
• Support payment of interest on
demand deposits in those areas where
NOW accounts are allowed.
“It behooves each of us as bankers
to give serious study to this entire
question including these alternatives,”
Mr. Richmond said. “Particularly, we
should try to make a determination as
to how our respective banks will be af
fected by the various proposals. Hope
fully, we will be able to make some
sound and practical decisions if called
upon to do so.”

Use NOW s as Trade-off
For Interest on Reserves,
Says Olda.B.A. Chairman
The proposal espoused by Fed
Chairman Arthur Burns relating to
commercial banks offering NOW ac
counts initially strikes Oklahoma bank
ers as being repulsive, said Tracy Kel
ly, chairman, Oklahoma Bankers Asso
ciation, and president and chairman,
American National, Bristow, Okla.
“When we look at the alternatives,
however,” he said, “it seems to be the
more propitious alternative for com

mercial banks to take.”
However, he continued, in order for
banks to maintain their share of the
market and continue to serve their
customers, certain trade-offs should be
made to make NOW accounts more
palatable.
First, the Fed should pay interest on
all of its reserve deposits from member
banks, he said. Second, the )i% dispari
ty in the interest rate enjoyed by thrifts
should be eliminated.
“W e are all in the same market for
consumer dollars,” he said. “In order
to survive and remain profitable, Okla
homa banks respectfully urge that the
interest rate differential be removed so
the free market can work.”
Mr. Kelly also thinks that, if NOW
accounts are implemented, they should
be phased in over at least a two-year
period, rather than being thrust on
banks.
Mr. Kelly said that Fed membership
for banks of under $100 million is of
minimal value, a fact evidenced by the
number of banks switching from na
tional to state charters.
But he said he was glad to note that
the Fed is probing ways of being more
serviceable and effective to its mem
bers. In recent months the Fed has en
gaged in some introspection and has
become more sensitive and responsive,
he said. The Fed should be more as
siduous in its efforts to please because
it is the “only game in town.”

Kentucky Bankers Opposed
To Demand Deposit Interest
And N O W Account Spread
Because of the predominance of rel
atively small banks in Kentucky, the
recommendation of the majority would
be for steadfast opposition to any
change of any kind with respect to the
payment of interest on demand de
posits or the admission of depository
thrift institutions into the checking ac
count business, said O. T. Dorton, pres
ident, Kentucky Bankers Association,
and
president,
Citizens
National,
Paintsville, Ky. '
“The principal factor to be consid
ered is suggested by the Fed impact
study on payment of interest on de
mand deposits,” Mr. Dorton said.
“There, the idea is expressed that the
transitional costs of converting to ex
plicit payment of interest on demand
deposits are likely to fall most heavily
on smaller banks.
“Smaller banks have, as the study
points out, a much larger proportion of
smaller household deposit accounts. It
is likely that cost increases will be
greater for such accounts.
“Therefore, smaller banks will ex-

MID-CONTINENT BANKER for May 1, 1977

perience larger earnings reductions than
larger banks and will probably expe
rience longer transitional problems.”
He said such would seem to be the
case for his $ 4 1-million-deposit bank,
where more than 60% of the demand
deposit accounts carry balances of less
than $500.
Many bankers and writers say that
by leaving things as they are, present
legislative trends favor the growth and
diversification of thrifts and credit
unions while leaving banks with tra
ditional powers and legislation that is
not current enough to enable banks to
cope with competition, he said.
“According to this argument, bank
ing legislation of a positive nature is a
must,” he said. “Failure to act in these
key areas, they say, means that banking
will stand still, while credit unions,
savings banks and S&Ls will continue
to gain powers that were once exclusive
to commercial banks.”
Most country bankers in Kentucky
are not confronted with intense credit
union competition and most Kentucky
S&Ls disavow much interest in NOWs
or checking account privileges, he said.
If a compromise or consensus to of
fer NOWs or payment of interest on
demand deposits becomes the predomi
nant point of view of the banking in
dustry, he continued, the issue must be
approached from the standpoint of
equality—equality in chartering and
capital requirements, in taxation of all
financial institutions, in regulation, in
interest paid to savings or checking cus
tomers, in branching and, in general,
in the services available to financial
customers.
Mr. Dorton said that, whatever
change is offered, it seems to open a
Pandora’s box of problems. Among
these is the question of giving or sell
ing services.
“If payment of interest is forced up
on the banking industry,” he said, “this
cost must be overcome by selling ser
vices.”
The services now given by banks to
their customers are tax-free, he said,
but would become taxable through the
payment of interest on demand deposits
or NOW accounts and the charging
for services necessitated by such a
change.
“It is undoubtedly true that we live
in a fast-changing society,” Mr. Dorton
said, “and certainly where change is
necessary in the banking industry, it
should be accomplished. But, the
American free enterprise system has
been well served by its banking system
and more consideration should be given
to the impact of piecemeal change as
contemplated by Congress.”

". . . thrifts will find a way . . . to offer transaction or checking
accounts in the same manner as credit unions have devised the
share-draft account for their members

Little Support Expressed
For Demand Acct. Interest
Among Texas Bankers
There is little or no support for in
terest-bearing checking accounts among
Texas bankers, from those representing
the largest banking houses to those rep
resenting the smallest, said S. R. Green
wood, president, Texas Bankers Associa
tion, and president, Temple National.
Whether or not the specific statutory
authority for all financial institutions to
offer interest-bearing checking accounts
could be accompanied by enough in
ducements to attract banker support is,
at best, doubtful, he said.
Proponents of a package of this kind
envision its key elements as including
the removal of the interest rate differ
ential on savings accounts and equal
reserve requirements, equal supervisory
burdens and equal tax treatment at
state and federal levels for all financial
institutions, he said.
“It is the view of the proponents on
the positive side,” Mr. Greenwood said,
“that bankers possess the qualifications,
experience and dedication to compete
well under conditions of substantial
equality. On the negative side, propo
nents argue that bankers simply do not
have sufficient influence in the long
run to prevent the eventual legislative
authorization to thrift institutions for
some type of interest-bearing transac
tion or checking account; that legisla
tion of that kind is inevitable.”
A companion argument is that thrift
institutions will find a way, even with
out specific legislative authority, to offer
transaction or checking accounts in the
same manner as credit unions have de
vised (with the help of banks) the sharedraft account for their members, he
said.
Mr. Greenwood questions whether a
substantially level playing field for all
financial institutions is achievable. Two
recent pronouncements have some bear
ing on this question, he said. One is the
announcement of the U. S. League of
Savings Associations’ legislative pro
gram calling for leaving the differential
intact in statutory form for the next
five and a half years. The other is the
blast issued by Senator Thomas J. Mc
Intyre (D.,N .H .) against the Fed for
removing the differential on IRA and
Keogh accounts, an action that clearly
was in the interest of a large number

MID-CONTINENT BANKER for May 1, 1 977

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of individuals who wish to save toward
their retirement.
Mr. Greenwood said that senators
William Proxmire (D.,Wis.) and Edward
W. Brooke (R.,Mass.) strongly urged
that the Fed not take such action be
cause it would be “most untimely” and
would “prove to be counterproductive
to the objective which we jointly share
to enact a modest legislative package”
to authorize nationwide NOW account
authority.
But, Mr. Greenwood said, it is the
words of Senator McIntyre that the
Board’s action is a “unilateral, specialinterest initiative on behalf of com
mercial banks which represents gross in
sensitivity to the interests of thrift in
stitutions” which are the most chilling
in terms of hoping for some degree of
fair play in the level-playing-field pack
age approach.
“If action on a matter as relatively
minor as letting banks pay the same
rate of interest as thrifts on small, in
dividual retirement accounts invokes
this kind of rhetoric from three of the
five members of the Senate Banking
Committee’s subcommittee on financial
institutions, what real hope is there for
balanced and basically fair legislation?
The view from my crystal ball indicates
virtually none,” he said.
Aside from political realities, Mr.
Greenwood said he has deep doubts
about the advisability of legislation that
would thrust all S&Ls, credit unions
and other thrifts into the demand-de
posit function. In years to come, he
said, the process of accumulating funds
by banks for financing the great variety
of economic needs of our communities
may be impaired by thrift “bank” activi
ties in acquiring demand deposit types
of accounts.
“Perhaps, through a Fed funds mech
anism or otherwise, banks could borrow
excess funds from the thrifts to satisfy
economic needs that are beyond their
lending scope,” Mr. Greenwood said,
“but how is the public interest served
by creating another middleman in the
financial intermediary process? Under
present conditions and laws, thrifts are
viable and thriving.”
Mr. Greenwood said there is no com
pelling reason to change a financial
structure that has worked well for dec
ades. He is more persuaded by the
philosophy of Bert Lance, director of
the office of the budget in Washington:
“If it ain’t broke, don’t fix it!”

Demand-Deposit Interest
Could Harm Small Banks,
Says III.B.A. President
Persuasive arguments about econom
ic efficiency and benefits to depositors
can be offered in support of the pro
posals for banks offering NOW ac
counts and the Fed paying interest on
reserves, said Ray G. Livasy, president,
Illinois Bankers Association, and presi
dent, Millikin National, Decatur, 111.
However, he added, a number of
banks, especially small- and mediumsize institutions, are likely to be adverse
ly affected, a point that has not re
ceived sufficient attention. He said that
the short-term transitional and—in
some cases—permanent costs to many
banks may be severe. The Illinois
Bankers Association feels an obligation
to raise reservations on behalf of its
members, he said.
“W e share in a fundamental com
mitment to a competitive, marketoriented financial system,” he said. “We
believe that many banking decisions
are made in an environment that close
ly resembles the classic textbook model
of a market economy. Thus, we support
developments that increase competi
tion, while avoiding excessive market
power for some institutions, for the
benefit of our customers, employees
and stockholders.
“It’s important to remind ourselves
that Congress and the states have de
cided that financial institutions have
a special relationship to depositors,” he
said, “and, accordingly, have construct
ed a legal and regulatory protective
framework. Thus, our present banking
system differs significantly from the
textbook model.”
Banks have developed a structure
of products, prices, competitive prac
tices and operating procedures on the
basis of competition within a structure
of laws and regulations, he said.
Over the years, numerous proposals
have been made to change parts of
this legal or regulatory structure on the
premise that change will increase com
petition, he added. Many of the pro
posed changes have initially appeared
to provide such benefits, but they often
fail to stand up under closer scrutiny
because the real world effects of a
change in the banking environment are
distributed in a different manner than
the simple, elementary theoretical
model a market-type economy would
indicate.
“A more sophisticated type of eco
nomic analysis that takes account of
the existence of legal and regulatory
constraints, participants with unequal
market power, differing rates of adjust
ment to change and other important

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Federal Reserve Bank of St. Louis

differences from the textbook economy
is likely to lead to a more complex as
sessment of benefits and costs and pro
vide a logical justification for a partisan
point of view,” he said.
He cited the great deal of interest
in re-examining the prohibition on pay
ment of explicit interest on demand de
posits. In addition, there is significant
pressure to expand NOW account priv
ileges to all banks. To round out the
package, the Fed is urged to pay inter
est on required reserves. The basic sup
porting arguments are that these
changes will improve the economic ef
ficiency of our financial system, lead
to a more efficient allocation of re

the more practical-minded advocates
have recognized some of these transi
tional problems and have suggested
that NOW accounts be limited to con
sumers and that the rate of interest
paid be fixed below market rates.”
The proposal to pay interest on re
serve balances is a far more complicat
ed subject, Mr. Livasy said. The argu
ments of economic efficiency and re
source allocation generally apply.
“Certainly, all banks that are Fed
members will benefit with earnings
from previously non-earning assets,
while federal government income will
be reduced,” he said. “The impact on
the corresponding banking network is

"Tfiere is considerable likelihood that a large number of banks
will be unable to make timely changes in their price structures
and thus will experience an extremely difficult transition period

sources and benefit consumers, firms
and government units.
Initially, Mr. Livasy said, these are
reasonable assumptions. Little has been
said about the fact that the distribution
of the costs and benefits of these
changes will not be uniform among all
banks.
“Banks are not permitted to pay in
terest on demand-deposit accounts,” he
said. “They do provide an implicit in
come on these deposits by providing
checking account and other bank ser
vices at less than full cost or at no
cost. Overall, the cost of these services
constitutes an important part of a bank’s
operating expenses. Many banks will
be able to make prompt adjustments
in their pricing structure to pay interest
on demand deposits while at the same
time assessing a service charge against
checking accounts and other types of
banking services. These banks enjoy
sufficient market power, geographical
location or customer mix so that the
adjustment can be made in a short
time period.”
There is considerable likelihood that
a large number of banks will be unable
to make timely changes in their price
structures and thus will experience an
extremely difficult transition period, he
said. Numerous other banks may never
be able to fully restructure their pric
ing and service mix. Thus, for a large
number of banks, and very likely small
and medium-size banks, the net impact
of the payment of interest on demand
deposits is likely to be higher operating
costs, lower earnings and possibly some
impairment of capital.
“NOW accounts can be subject to
the same analysis,” he continued.
“Many of the same arguments apply,
although in lesser magnitude. Some of

difficult to assess because it involves
the issue of the probability of banks
choosing to utilize Fed services as op
posed to correspondent bank services.
One principal benefit to the Fed is
likely to be a slowing or halting of
membership erosion.”
Mr. Livasy said the Illinois Bankers
Association has significant reservations
about the proposed changes in the pric
ing structure of deposits and introduc
tion of NOW accounts.
“W e feel that, on balance, the pro
posal to pay interest on required re
serves has important benefits in a broad
context,” he said. “W e recognize that
there are powerful forces generating
demands for these changes. W e are of
the view that an important segment of
the banking industry will be adversely
affected and that ultimately this will
have a harmful effect on many com
munities, consumers and business firms.”

One Objective of Thrifts
Is for Nationwide NOWs,
Says Kan.B.A. Pres.-Elect
The stage is definitely being set for
legislative action that would permit na
tionwide NOW accounts in all financial
institutions, said Elwood Marshall,
president-elect, Kansas Bankers Associ
ation, and president, Home National,
Eureka, Kan.
The ABA, at a joint meeting attend
ed by the Governing, Government Rela
tions and State Association Advisory
councils, accepted this concept con
tingent on the public being served by
having common rules apply to all finan-

MID-CONTINENT BANKER for May 1, 1977

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cial institutions authorized to offer such
transaction balances, he said.
“In my opinion,” he added, “the big
emphasis on the payment of interest
on transaction balances has been
brought about by actions on the part
of the thrift industry, which, it would
seem, is interested in obtaining a larger
market share of the consumer dollar
and possibly the investment dollar.”
This pressure by the thrift industry,
he said, which in some instances may
have gone beyond the intent of Con
gress in the assumption of powers, has
caused the Fed Board of Governors to
institute a staff study and this study
seems to provide authority for some of
the following assumptions:
• That commercial banks are pay
ing between
and 5% implicit inter
est on demand deposits at the present
time in the form of services performed
at less than cost and, in some cases,
through premium programs and other
gimmickry.
• That the implicit interest being
paid on demand deposits is not neces
sarily what the public wants done with
the earnings on demand-deposit bal
ances.
• That a free marketplace is the
only way resources can be allocated ef
ficiently. Thus the prohibition of inter
est on demand deposits is inefficient.
® That the Banking Act of 1933

was enacted in a crisis atmosphere
without formal hearings and that the
prohibition of interest on demand de
posits was predominately a trade-off
or compromise to permit enactment of
legislation requiring deposit insurance.
“I tend to agree with the results of
the various studies and the feeling that
some action to abolish the prohibition
of interest on demand deposits is in
evitable. And I believe that bankers
should take an active part in this move
ment in order to influence the direction
ultimately taken by legislators in an at
tempt to see that some measure of
equality in competition is obtained.”
Mr. Marshall said it would appear
that the NOW accounts recommended
by Fed Chairman Arthur Burns and
which are already authorized in some
states, would be the proper vehicle,
since it would then be possible for fi
nancial institutions to establish a sep
arate class of accounts on which service
charges could be established that
would reasonably offset the cost of
such service and on which a fair rate
of earnings could be allowed the con
sumer.
“Since the business community al
ready has found ways to keep all but
small transaction balances in interest
earning investments or accounts,” Mr.
Marshall said, “I tend to lean toward
giving business accounts and corpora-

CONSULTANTS TO F IN A N C IA L INSTITUTIO NS

—

tions the same privileges as individ
uals.”
There is a possibility that the Fed
sees the payment of interest on trans
action balances as being an advantage
in its favor in the power struggle going
on among regulatory agencies, he said.
“I believe the weakest financial in
stitutions and those with least strong
management will lead the parade to
‘give the bank away,’ ” he said. “Fail
ures will become commonplace. Bank
ownership will lose its attractiveness.
“On the other hand,” he continued,
“marginal checking account customers
will be forced out of the banking sys
tem and advantages will accrue to
larger bank customers at the expense
of smaller bank customers.”

Mississippi Bankers
Oppose Now Accounts;
Recommend More Study
Mississippi bankers are opposed to
the offering of NOW accounts because
they are not convinced that this type
of account serves the best interests of
the public. This is because they place
certain types of financial institutions
at a disadvantage vis-a-vis their compe
tition, according to John H. Mitchell
Jr., president, Mississippi Bankers As
sociation, and vice chairman, National
Bank of Commerce of Mississippi,
Starkville.
With regard to payment of interest
on reserve accounts by the Fed, Mr.
Mitchell’s personal opinion is that Mis
sissippi banking would support a rea
sonable return on reserves that are now
sterile, provided no adverse effect on
the management of the nation’s mone
tary policy would result.
“The larger question of payment of
interest on demand deposits should
certainly be researched and discussed
fully since there seems to be some
sentiment— at least in a few quarters—
to renew this practice after some 42
years,” he said.
“I must say that I am skeptical of a

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return to this practice and would have
to be convinced of its soundness before
I . . . could support such a move,” he
said. “W e do not have a closed mind
on the issue, but most of my fellow
bankers with whom I have visited on
the subject are yet to be convinced of
the soundness of a return to interestyielding checking accounts.”
Mr. Mitchell said there are several
reasons for this skepticism, some of
which pertain to the advisability of
blurring the demarcation of powers
among the various intermediary type
financial institutions. The point must
be made clearly, he said, that if banks

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are to begin paying interest on demand
deposits, they must make up the in
creased operating expense by generat
ing additional income, which most like
ly would have to come from increased
service charges on checking accounts.
Mr. Mitchell said it seems to him
that the smaller depositor would be
hurt more than the larger depositor
from increased service charges since
the amount of interest he may earn on
his interest-bearing checking account
would probably b e less than the
amount of service charge on the ac
count, particularly if it is a high-volume account A point to consider, he

continued, is that the interest earned
on checking accounts would be taxable.
Mr. Mitchell recommended that the
entire subject be studied extensively
by competent persons and groups be
fore any serious attempt is made by
Congress to permit these “significant
changes” in banking structure.

Demand-Account Interest
'Horrifies' Many Bankers,
Says La.B.A. Past Pres.
Checking accounts are difficult and
expensive to obtain in these highly
competitive times, and the cost of ad
ministering them rises with each pass
ing year. No wonder many bankers are
horrified at the thought of paying inter
est on demand deposits.
These are the thoughts of Donald
L. Delcambre, immediate past presi
dent, Louisiana Bankers Association,
and president, State National, New
Iberia, La.
“While the public may view the pay
ment of interest on checking accounts
as no more than fair,” he said, “I am
afraid they are being grossly misled by
elected officials who either know or
should know the facts in this situation.
“One simple fact is that bankers
must be allowed to make a profit if
they are to continue to provide the
public with the long list of financial
services our customers take for grant
ed,” he said. “If and when banks are
forced to provide interest-bearing
NOW accounts, or to pay interest on
demand deposits, the loss of revenue
will simply have to be made up from
some other sources.
“The public is going to have to re
turn the money it receives in interest
on NOW accounts or on checking ac
counts to the banking system through
the payment of higher service charges,
higher interest rates on loans, or
through some other means,” he said.
Mr. Delcambre said that the Fed has
proposed payment of interest on re
serves in response to pressure by bank
ers, who have long seen such payment
as no more than fair. “But now we are
being told that the government is will
ing to help make up losses we will in
cur through the payment of interest on
demand deposits by paying us interest
on our reserves,” he said.
Such a move on the Fed’s part will
take some of the pressure off bankers
to raise service charges and interest
rates, he continued, but it is a matter
of the Fed doing the right thing for the
wrong reason. If the payment of inter
est on reserves will be fair after we be
gin paying interest on demand ac
counts, he said, why hasn’t it been fair
all along? Or is it just that the Fed, in

MID-CONTINENT BANKER for May 1, 1977

Build some muscle into
your credit life protection!
W ith G lo b e L ife ’s c o m p le te p a c k a g e o f C re d it L ife p la n s ,
y o u ’ve g o t fu ll- s tr e n g th p r o te c tio n w e ig h e d iin y o u r fa v o r.
A n d G lo b e h a s s tr e n g th in re s e rv e , to o . . . a c a p ita l
s tr u c tu r e o f o v e r $ 5 0 m illio n a n d o v e r $ 2 .5 b illio n o f life
in s u r a n c e in fo r c e . . . c o a s t-to -c o a s t.

GLOBE

G lo b e L ife . . . a n a tio n a l le a d e r w ith m u s c le to re ly o n .

AND ACCIDENT
INSURANCE COMPANY
Oklahoma City
ASSETS IN EXCESS OF
$120 MILLION

MID-CONTINENT BANKER for May I, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

response to political pressure, is bend
ing over backwards to make this pill
a little more palatable for bankers?
“After all is said and done,” he said,
“so long as NOW accounts and interest
on demand accounts are plugged into
the system simultaneously throughout
the nation, as Fed Chairman Arthur
Burns proposes, I really don’t foresee
any long-range detrimental effect to the
commercial banking system. The only
ones who will be hurt will be our cus
tomers, because they will be the ones
who will be forced to pay the bill.”
He stated that the matter really is
more complicated than it seems. “Only
when we look way underneath the car
pet do we find the real reason for all
the noise,” he said. “The simple fact
is that the S&L folks want third-party
payment powers. S&Ls on the East
Coast were the originators of the NOW
concept and the idea of giving NOWs
to S&Ls nationwide at the same time
they are given to banks is understood.

“Meanwhile, S&Ls will go merrily
along offering a limited, highly profit
able list of services and basking in the
warm light of Regulation Q,” Mr. Delcambre said.
What are bankers going to do? he
asked. How can they hope to succeed
in a campaign aimed at halting the
payment of interest to the consumer on
his checking account?
“I ’m afraid the situation is nothing
short of hopeless,” he said. “We
stopped the S&Ls from gaining addi
tional powers without paying the fare
last year through brute force. But brute
force is never the long-range answer.
If you threaten it, it can work for you,
but in the political arena it can’t be
used over and over again successfully.
“I ’m afraid banking’s only hope of
halting the S&L incursion into our in
dustry will be to demand equality—
on rates paid on savings, regarding re
serves, taxes and services performed,”
he said.

Former Comptroller Sees Bank Reform
As M ain Challenge Facing Banking

OPICS covering marketing, assetliability management, regulation,
personnel management and E F T S were
discussed at United Bank of Denver’s
recent correspondent bank manage
ment conference. More than 200 bank
ers from eight Rocky Mountain region
states attended.
One speaker, James E. Smith, execu
tive vice president, First Chicago
Corp., and former Comptroller of the
Currency, said the main challenge he
sees coming is bank reform. If financial
reform moves in a genuinely balanced
manner, Mr. Smith believes bankers
should go along. He said that banking’s
success in stopping proposed financialindustry reforms in 1975-76 will not
happen again. His reasoning: There
were new banking committee leaders
in both the Senate and the House at
that time, but both have learned a lot
since then. Labor unions and the hous
ing construction industry were con
cerned that if thrifts received consum
er-banking powers, they would neglect
the building industry. However, this
separation of labor and home builders
from S&Ls will be mended, and then
the thrifts will continue their move to
ward powers they want. Finally, Con
gress, in the midst of an election year,
concerned itself only with what had to
be done.
According to Mr. Smith, there are
36

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Federal Reserve Bank of St. Louis

no good reasons why, ultimately, thrifts
won’t be allowed consumer banking
powers. He added that there also are
no sound reasons why the ceiling on
interest rates banks can pay on savings
accounts shouldn’t be removed.
Kent Glover, regional administrator
of national banks, 12th National Bank
Region, said the new examinationimplementation procedures were de
signed to allow fairer, more objective
examinations and will allow examiners
to be more concerned with the future
of the bank under examination rather
than its past or present. He advised
smaller banks to stress to their direc
tors the importance of having written
policies for their loans and investments.
Harry Bloom, Colorado banking

Anti-Crime Seminars
Four anti-crime seminars will be
sponsored this year by Mosier Safe
Co., Hamilton, O. Each will last two
days instead of one day, as did
previous seminars.
The seminars will be held as fol
lows: May 18-19, Washington,
D. C.; June 15-16, New Orleans;
October 12-13, Kansas City; and
November 16-17, San Francisco.
The 1977 programs have been
expanded to include presentations
on executive kidnap and hostage/
extortion by F B I special agents and
on the subject of bomb threats and
search by members of the U. S.
Army Bomb Disposal Unit. In ad
dition, a special morning session
will be devoted to an explanation
of the Bank Protection Act of 1968
as it relates to requirements of the
Insurance Services Office.
During the remainder of the two
days, experts will crack a safe on
stage, bum a hole through a sixinch-thick safe with a burning bar
and demonstrate electonic alarm de
fects of all but the most sophisti
cated systems. In addition, safes
that have been peeled, ripped,
core-drilled, punched and “water
bombed,” the latest MO (modus
operandi), will be displayed.
Information on the seminars may
be obtained by writing: Robert
Rosberg, Mosler, 1561 Grand Boule
vard, Hamilton, OH 45012.

commissioner, spoke on capital adequa
cy. He said that although federal and
state agencies differ in the formulas
they use for determining capital ade
quacy, he views as important the char
acter and ability of an institution’s
management, earnings and dividend
policies, its loan-loss experience, char
acter of the assets and availability of
secondary sources of liquidity.
In the session on “E F T S Update,”
Richard Watt, vice president, United
Banks Service Co., said that the Na
tional E F T Commission’s recommenda
tions are both pro-consumer and procompetitive. He said the commission
makes no distinction between kinds of
financial institutions and wants all to
be able to compete who want to do so.
Charles Sonnen, president, Mountain
States Bankcard Association, added
that retail E F T is the way in which
smaller banks will be able to compete
with large financial institutions, as both
will be able to offer consumers the
same purchasing power. # *

V is itin g d u rin g U n ite d B ank o f D en ve r's c o r
re s p o n d e n t b a n k m a n a g e m e n t confe ren ce a re
(I. to r.): Jam es B. G ro n s ta l, M e tro p o lita n S tate,
C om m erce C ity , C olo.; Stephen P. B a ltz, a .v .p .,
host b a n k ; O rre l D a n iel, L ittle to n (C olo.) N a t'l;
a n d R ichard A . K irk , pres., host b a n k .

MID-CONTINENT BANKER for May 1, 1977

"¥nir Claim Has Been Processed;
\bur Check Is In The M ail!”
Y es. Scarborough backs up its claim as “the bank insurance
people.” W e sell insurance to banks and when claims are
filed for losses . . . we handle them directly.
D irect claim processing means prompt attention, fast action
on your bank’s claim. Everything is handled with a minimum
of red tape.
A s bank insurance specialists, we understand the relatively
com plicated nature of bank risks. Our experienced claim
department is another reason for you to protect your bank
with insurance through Scarborough.

Scarborough
the bank insurance
people
Scarborough and Company 222 N. Dearborn Street • Chicago, Illinois 60601 *(3 1 2 )3 4 6 6 0 6 0
MID-CONTINENT BANKER for May 1, 1 977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Lance to Be in Spotlight
During Directors Assembly
A t Palm Beach May 12-15

We never
let you
down.
When you deal with
Christmas Club a Corpor
ation, you can count on
deliveries on time, as
promised. We’re the reliable
ones, with a 67-year old
reputation for dependability
and service. Call us toll free at
(800) 523-9440, anytime.

ch rasu roas

club
a corporation
P.O. Box 20
Easton, Pennsylvania 18042

RESULTS?
WE ARE SAVING
BANKS
18% to 31%
A YEAR IN
OPERATING
COSTS. . .
THAT’S WHY
OVER 200
BANKERS WILL
RECOMMEND US.
For detailed case histories,
call 214/ 241-9444 or write:

h jb
Howard J. Blender Company

2695 Villa Creek Drive
Suite 240
Dallas, Texas 75234
38

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

PALM BEACH, FLA .— The Breakers
will host the 28th Assembly for Bank
Directors May 1215. The event’s fea
tured guest speak
er will be Bert
Lance, d ir e c t o r ,
Office of Manage
ment and Budget,
Washington, D. C.
S p o n so re d b y
the Foundation of
the Southwestern
Graduate School of
LANCE
Banking, Southern
Methodist University, Dallas, the As
sembly also will spotlight a number of
dignitaries from the banking and busi
ness world, including: Kenneth A. Ran
dall, president and CEO, Conference
Board, New York City; Fed Governor
Philip E. Coldwell; George LeMaistre,
FD IC director; Eugene L. Swearingen,
chairman and CEO, Bank of Oklahoma,
Tulsa; and Will Mann Richardson, vice
chairman, Citizens First National,
Tyler, Tex.
In addition, a spouses’ program has
been planned.
For more information about the 28th
Assembly for Bank Directors, write the
Foundation, SMU Box 214, Dallas, TX
75275.

Letter
To
The
Editor
Dear Editor:
Just a minute! Let’s look at some
other comments on the subject of
“headhunter” personnel r e c r u it e r s ,
whose methods were described in an
article in the March issue.
First, the concept of headhunting
represents stealing from another em
ployer. Anyone who will steal fo r you
will likely steal from you. The process
of discussing desirable experience, etc.,
with various members of top manage
ment provides the headhunter with an
excellent file of qualifications for fu
ture use.
Second, the 25%-35% cost charged by
headhunters is usually over and above
out-of-pocket expenses. I charge a 10%
maximum fee, regardless of salary or

out-of-pocket expense. Most a g e n c ie s
charge from 10%-25%, depending on
salary.
Third, in the area of qualifications
of the searcher—does the headhunter
have experience as a banker? I believe
that it takes a former banker to know
a banker. Thus, an employment agency
staffed by former bankers can offer far
superior service.
Fourth, how stable will an employee
selected by a headhunter be? Anyone
attracted to a position because of sal
ary or title frequently finds his wife to
be unhappy in the new environment.
Will the headhunter consider the can
didate’s stability from the family stand
point?
An employment agency is not suc
cessful in its work unless it makes a
match that is suitable to all concerned.
I believe that to achieve mutual satis
faction, the employment agency work
ing to fill a bank position must be
staffed by former bankers.
Tom Hagan & Associates, North Kan
sas City, Mo.

RMA Schedules Workshop Series
On Real Estate Loan Assessment
Robert Morris Associates’ domestic
lending division has scheduled a work
shop series on “Value and Credit Assess
ment in Real Estate Lending.” Places
and times for the sessions will be
Hyatt Regency Cambridge, Boston,
May 12-13; St. Francis Hotel, San
Francisco, September 22-23; and The
Royal Orleans, New Orleans, November
17-18.
Registration is open to personnel
from all banks, but those from RMAmember banks will receive preference.
The series of two-day workshops has
been designed to help senior bankers
sharpen their awareness of factors that
make a sound real estate loan from
the standpoints of property values and
credit. The seminar is intended to pro
vide senior commercial lending officers
or loan administration officers with an
opportunity to review those aspects of
real estate that are essential to deter
mining the soundness of such credits;
the event is not designed to train bank
ers in making real estate loans.
Registration materials for the work
shops have been mailed to all RMA
members. The fee is $165 for member
banks and $210 for nonmembers. For
more information, write Cecelia Small,
Registrar, RMA Headquarters, 1432
Philadelphia National Bank Building,
Philadelphia, PA 19107.

MID-CONTINENT BANKER for May 1, 1977

Prudent M an' Rule M ust Be Followed
In Trust M a n a g e m e n t Expert W arns
ANK D IREC TO RS and officers who
manage trust funds and customer
portfolios must do it as if it were their
own investment, since they may be
liable for any losses, according to
Martin E. Lybecker, associate professor
of law, State University of New York,
Buffalo.
Writing in Counsel, the quarterly
publication of MGIC Indemnity Corp.,
Mr. Lybecker says that banks not only
must conform to restrictions set up by
the settlor, but must meet the legal
fiduciary standards of a “prudent man
in the conduct of his own affairs.” If
investment decisions fail to meet that
test, Mr. Lybecker writes, the institu
tion and its responsible directors and
officers may be surcharged for resultant
losses.
The State University expert says that
the major reason for federal and state
examination and review of investment
activities of financial institutions is to
assure depositors of continuing sol
vency. In addition, Mr. Lybecker states,
directors of banks are required by state
and federal law to conduct their own
internal investigations annually. But, he

notes, the number of cases where fi
nancial institutions have failed to fol
low the law is negligible.
“Officers and directors,” Mr. Ly
becker warns, “need to take a more
sophisticated approach to trust man
agement based on modern portfolio
theory and the total return concept.
The focus should be on the total re
turn of the portfolio over a period of
time, rather than on the specific gains
or losses on individual securities held
in a portfolio. By diversifying the num
ber and variety of instruments in a
portfolio when it comes to choosing in
dividual securities, overall risk may be
reduced.”
The benefit of using such procedures,
he adds, is that modern money man
agers can accept greater risks and pro
duce a larger total yield from an in
vestment portfolio than could any other
portfolio at any level of risk.
“Directors of financial institutions of
fering investment management services
must be alert to evolving perceptions
of the fiduciary duties of all persons
holding themselves out as investment
managers,” he says. “To properly an

ticipate new trends and requirements
in offering these services, directors
must carefully monitor developments in
their own fields an d in analogous areas
—such as the securities industry, brok
er-dealer and mutual funds.”
In conclusion, Mr. Lybecker warns
that “the fiduciary liability and rela
tionship is a role that federal regulators
and the courts take very seriously in
considering the appropriateness and
legality of action taken— either con
sciously or unconsciously—by financial
institutions.” * *
O rig in als:

Rockwell Pencil Drawings
Are 'Draw1for Bank
A collection of 34 original pencil
drawings by Norman Rockwell—on
loan from Massachusetts Mutual Life—
proved to be an excellent “drawing
card” for Frost National, San Antonio.
The collection, comprised of works com
missioned to illustrate a series of nation
al consumer advertisements from 19501964, was open to the public during
regular banking hours.
Besides giving a glimpse of fashions
of past decades, the collection conveyed
the familiar Rockwell themes of family
life, children, pets and everyday inci
dents.

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E S T A B LIS H E D 1935

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MID-CONTINENT BANKER for May 1, 1 9 7 7

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Federal Reserve Bank of St. Louis

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39

A Simplified Reserve Requirement
Could Increase Banks' Earnings
r e a t e r e a r n in g s po ten
t i a l through simplified reserves?

Many financial institutions, if they
were unencumbered by higher Federal
Reserve or state reserve requirements,
would manage cash assets so that idle
cash is minimized
and their mix of
earning assets maxi
mized. That’s what
led me—in writing
my Stonier Gradu
ate School of Bank
ing thesis, “A Sim
plified Structure of
Financial Cash Re
serves”—to seek a
simplified r e s e rv e
requirement.
Because my thesis research was
started while serving as a central bank
er, the thesis also considered the Fed’s
policymaking needs. My study included
sections that analyzed:
• A compromise stucture that meets
vested interests.
• Earning assets as reserves.
• How national banks would in
crease earning assets as painless Fed
members.
• How nonmember banks can cir
cumvent the evolution of forced, “idlebalance” reserve requirements.
• The demise of idle balances—rev
olutionary correspondent reactions.
In addition, I analyzed these national
stabilization objectives:
• Reversal of the problem trend in
shrinking Fed membership.
• Making reserve requirements a
fixed policy fulcrum.
• Making open market operations
more effective.
• Improving data gathering for pol
icy decisions.
• Increasing bank acquisition of
earning assets . . . a noninflationary fin
ancier of some public debt.
In my opinion, I have come up with
a workable compromise among many
vested interests. Individual institutions
would gain flexibility to decide their
reserve composition within lowered re
serve percentages. For monetary policy
aimed at stability, the only disincentive
to Fed membership (burdensome re
serves of non-earning assets) would be
ended, and improved success of na
tional policy would be likely.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

By LARRY C. HEMPEL
Assistant Vice President
Market Manager-Commercial
First National Bank
St. Louis
Table No. 1 on page 42 displays
rule-of-thumb percentages of cash re
serves and earning liquidity reserves
for operating cash managers. Purposes
for cash balances would be transactions
and acquisition of correspondent ser
vices. Because of the opportunity to
maximize the quantity and quality of
earning assets, increases in bottom-line
earnings would be likely. The rules-ofthumb gleaned are useful targets since
these banks’ earnings also were ana
lyzed.
From these sample banks, I focused
on random banks in Illinois, the only
state where nonmember banks face no
specific cash-reserve-requirement per
centage by state banking authorities.
Therefore, Illinois nonmember banks
have freedom to decide for themselves
a “prudent” level and composition of
cash and liquidity reserves.
These
nonmember
banks
have

LARRY C. HEMPEL was with
St. Louis’ Tower Grove Bank from
1975 until last month, when he
joined First National in St. Louis.
He was appointed to head corre
spondent activities at Tower Grove
Bank early in 1976, after having
been assistant to the president and
assistant vice president.
From 1973 to 1975, Mr. Hempel
was creative marketing program di
rector for Maritz of St. Louis, spe
cializing in financial institutions.
Before joining Maritz, Mr. Hem
pel was responsible— from 1967 to
1973— for several writing, planning
and speaking activities at the St.
Louis Fed. He was in its research
department from 1968 to 1971.
Mr. Hempel was graduated from
the Stonier Graduate School of
Banking at Rutgers University, New
Brunswick, N. J., and received his
bachelor of science degree from the
University of Missouri-Columbia and
his master’s degree in economics
from Washington University, St.
Louis.

proved—to regulators, stockholders, de
positors and other financial institutions
— that about 8% cash assets held against
deposits meets their needs for transac
tions, correspondent services and de
positor withdrawals. They chose this
moderated level of cash assets and have
thrived.
These unencumbered banks have set
a unique precedent, because time has
tested these nonmember banker de
cisions to hold only modest levels of
cash assets.
The 8% is a yardstick on which regu
latory expectations can be focused. In
dividual financial managers, facing dif
ferent market structures, different sizes
of institutions, unusual factors in a
marketplace or composition of liabil
ities, might choose to hold cash balances
additional to this new prudency per
centage.
Why not allow financial managers to
keep only a prudent composition of
liquidity reserves:
• If the liquidity requirement is a
yardstick gained from the time-tested,
successful experience of a cross-section
of bankers?
• If these banks’ earnings exceed
similar banks with higher mixes of
liquidity reserves?
Why not shift most assets except
vault cash into earning reserves:
• If monetary-policy effectiveness
would be sustained, probably enhanced?
• If most financial institutions would
gain the opportunity for increased earn
ings and returns to their depositors,
borrowers and stockholders?
• If the assets thereby switched
from Federal Reserve balances to cor
respondent balances by Fed members
would purchase the time and profes
sional expertise of the staff at the larger
correspondent bank to improve results
at the respondent bank?
Examples of actual banks whose non
earning assets exceed the proposed
yardstick are studied in Table No. 2
on page 42. As the last column shows,
each of these banks would gain the op
portunity for greater earnings by shift
ing cash assets into earning assets.
Whether this potential for extra earn
ings from the total portfolio is managed
effectively depends on many other fac
tors, including asset mix; risk propen
sities of a bank’s asset managers; lia-

MID-CONTINENT BANKER for May 1, 1977

STABILITY • STRENGTH • MANAGEMENT
These Are of Vital Importance
to Banks and Their Customers

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PAUL V. HELEIN
President

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JO H N D. CAULFIELD
Vice-President

JAMES W . FINGER
V.P. Mo.

JAMES O. MYERS
Resident V.P.
Kansas

DOUGLAS HELEIN
Field Representative

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MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

Phone 314 V E 2-2717
S E C U R IT Y B E N E F IT L IF E
IN SU R A N C E

COM PANY

TABLE I
Cash and Liquidity Balances
I 15 Randomly Selected Illinois & Missouri Banks
Total NonCorres.
Earning Cash* Balances

Cash
Items

Currency
Coin

FRB

U.S. Treas.

State &
Other

Total Treas.
& State

8.9%

16.5%

25.4%

Banks $IO-$25 Million Deposits
ILLINOIS
20 Nonmembers
20 Nonmembers
20 Members

8.1%
8.0%
9.9%

6.1%
6.2%
2.8%

•2%
.1%
.9%

1.6%
1.6%
1.7%

4.4%

9.6%
M .9%

7.2%
4.9%

.6%
•8%

1.8%
1.7%

4.3%

____
—

—

13.5%

15.6%

29.1%

H .3%
12.8%

20.1%
17.1%

31.4%
29.9%

—

4.6%

14.2%

18.7%

—

8.4%

26.4%

34.8%

9.2%

10.6%

19.8%

MISSOURI
20 Nonmembers
20 Members

____

Banks $l00-$500 Million
ILLINOIS
5 Nonmembers

10.3%

8.9%

5 Nonmembers

6.2%

5.2%

5 Nonmembers

8.6%

6.6%

•4%

.8%

Banks $25-$ 100 Million
— ■

1.0%

Banks $10 Million and Under
1.9%
—
.1%

* Much of this is earning, in light of correspondent or Federal Reserve services obtained.
Data gathered from source materials of Sheshunoff & Co., Austin, Tex., based on Report of Condition data.

bility mix; economic trends; competi bottom line depend on each banker’s
tive factors and internal, short-run con management “savvy” in handling these
straints which are outside the scope of risk assets. In other words, receiving
the freedom to keep an additional por
this study.
A pparent W indfalls Re-Exam ined.
tion of total assets in earning assets
The word w indfall is interpreted in
doesn’t guarantee acquisition of higher
widely different ways—from “unex earnings over the long run.
2. The actual experience of compar
pected good fortune” to “undeserved
gain.” Also, windfall has been used to ably sized Illinois member and non
describe the benefits that would accrue member bankers supports the above
to financial institutions if current re thinking. When earnings performance
was taken from a cross-section, “aver
serve requirements were to be reduced.
The potential chain of events at indi age” extra earnings were only modestly
vidual financial institutions, following higher. Particular banks maximized
their yields, minimized losses and add
implementation of prudency reserves,
ed useful earnings to the bottom line.
would not lead to anything approach
Skill and effectiveness were rewarded.
ing a windfall as defined above. Several
3. Such additions to earnings are not
considerations should be reviewed:
1.
With lower requirements for cash a windfall when each financial profes
assets, the portion of an institution’s sional must decide to assume risk in
assets in the earning category might in pursuit of these earnings. If Treasury
securities are purchased and then liqui
crease, but additional earnings on the

dated quickly to meet unexpected cash
demands, the net gain on these earning
assets would be negligible and some
times negative.
4. Lower cash ratios mean computa
tion of bank service prices would bear
a reduced, implicit tax derived from
legal cash holdings. So, for any given
level of total assets, marginal costs will
be lower after adoption of lower cash
ratios. To the extent that the financial
market is competitive, more or less of
this cost reduction will be passed on to
the customer.
5. To the degree this proposal allows
some management teams to increase
earnings, extra profits mean those in
stitutions have
greater protection
against loan losses and can expand
lending to finance capital for urgent
needs.
6. With added short-term invest-

TABLE II
Cash Positions and Potential Extra Earnings
Missouri Banks
December, 1974

Deposits
First of Camdenton
$24,909,000
Farmers Savings-Marshall 23,917,000
Hannibal N at'l
22,708,000
First of Bethany
14,770,000
First o f Lebanon
14,768,000
Citizens of Pacific
14,557,000

Total Cash
Assets
$2,752,000
3,993,000
3,606,000
1,307,000
2,538,000
1,710,000

Cash
Ratio

Cash Assets
W ith 8%
Cash Ratio

n .o %
16.7%
15.9%
8.8%
17.2%
I I . 7%

$1,992,720
1,913,360
1,816,640
1,181,600
1,181,440
1,164,560

Excess Cash Annual Extra
Earnings at 5%
Assets
$ 759,280
2,079,640
1,789,360
125,400
1,356,560
545,440

$ 37,964
103,982
89,468
6,270
67,828
27,272

Data gathered from source materials of Sheshunoff & Co., Austin, Tex., based on Report of Condition data.

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MID-CONTINENT BANKER for May jjj 1977

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MID-CONTINENT BANKER for May 1, 1977

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THE
PLUS
CROUP
43

ments, many institutions would have
the ability to buy more long-term debt,
supporting the capital needs of the
economy and particular sectors such as
agriculture.
Nonmember banks would circumvent
other, more stringent legislation that
would yield higher cash-asset percent
ages and narrow composition rules
(evolution of such legislation is prob
able, based on precedents in other de
veloped nations and on the active cur
rent stance of the House Banking Com
m ittee). To get around these rules,
nonmember banks would:
• Support establishing one accept
able percentage for all institutions across
the country, assuring unification at a de
sirable rule structure.
• Be able, in most states, to hold a
larger percentage of earning assets.
• Solidify long-run regulatory bound
aries conducive to increased earnings
through asset management.
Shrinking F e d M em bership. In 1947,
there were 1,918 state-chartered banks
in the Fed (13.5% of total commercial
banks ). State members were down to
1,072 as of December 31, 1974, or
7.4% of total commercial banks. With
almost every new bank that obtains a
state charter passing up Fed member
ship, the number of state-insured non
member banks is up by about 2,000
banks since 1947.
More importantly, the share of total
bank deposits held in member banks
has fallen to near 75%, and large banks
are pulling out of the Fed. Six banks
with more than $100 million in deposits
withdrew between 1960-71. Thirteen
banks withdrew in only two years be
tween 1972-73. And the departure con
tinues.
Bankers have explained reasons for
the exodus from the Fed. A 1970 study
summarized these reasons as an at
tempt to maximize net current operat
ing earnings. A review of about 80%
of the closed files of former state mem
ber banks revealed a remarkable sim
ilarity of reasons for withdrawal. While
the various replies reviewed were
couched in somewhat different lan
guages, the recurring reason almost in
variably was financial. The recurring
theme in the withdrawal letters was
that the value of the services (desired
or needed) from the Fed does not com
pensate for the loss of income resulting
from the maintenance of sterile reserve
balances.1
When a good product’s prices are
lowered, the natural, predictable re
sponse—according to the law of de
mand—is an increase in the quantity

1 Robert C. Burton, Exodus From the Fed
eral Reserve, Stonier Graduate School of
Banking, June, 1970, pp. 58-108.

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Federal Reserve Bank of St. Louis

demanded. Simultaneously, if the ben
efits and qualities of this product are
viewed as having value, the increase in
quantity demanded is highly likely.
Fed membership would become a
product fitting into the above scenario
if the alternative reserve framework
presented would be implemented. The
main disincentive to membership would
be eliminated. Membership would be
attractive. The benefits have value, and
costs would be greatly reduced.
Any subsequent movement by the
Fed to “offer” a signature card for
membership to institutions nationwide
would be an estimated success, although
we have no evidence to predict what
the exact behavioral response would be.
Belonging to the Fed would be no more
painful than the decision to form a
correspondent relationship with a larger
bank. Each institution would be ex
pected to keep sufficient balances to
compensate for the capitalized value
of the benefits received, such as item
processing and safekeeping. One could
take membership and then keep the
prudency-rule balan ce at a commercial
correspondent bank. The timeless bene
fit of membership— discount window as
lender of last resort—now would be a
benefit without the cost of large, idle
balances.
The essence of the value from pain
less membership lies in policymaking
benefits. Any improved success in mon
etary policy results would benefit over
200 million Americans by lowering in
flation, boosting employment, sustain
ing growth and raising living standards.
Painless membership would lead to:
• Most financial institutions helping
the central bank by reporting monetary
statistics weekly or monthly.
• Central bank decisions built on
more complete data reports.
• Far less unpredictability in re
serve expansion, historically caused by
shifts of deposits between member and
nonmember institutions.
• Highly predictable multipliers be
tween base-reserve injections and even
tual monetary expansion and growth of
total spending.
• Dependence by the central bank
on open market operations as the basic
tool of nationwide economic stabiliza
tion.
Equivalence among banks and con
trol over the money and credit supply
are the essential objectives sought by
the Fed through reserve requirements.
The structure I propose is consistent
with these objectives and would lead
to their attainment. It would:
• Set the required percentage at
the Illinois prudency level. This allows
the risk taker to stretch out, while the
risk averter pulls in, as he will any

way.2 On average for the nation, the
percentage of deposits in earning as
sets may not be higher. Individual
banks will stretch to maximize the op
portunity.
• Monitor maintenance of the 8%
yardstick as a primary tool of quanti
tative control over the banking system’s
cash base, as a fulcrum for controlling
total deposit creation.
• Install a 20% liquidity ratio to
overlap the 8% reserve (cash) ratio.
• Strengthen monetary policy in to
tal by a com prom ise framework, which
is: a. Acceptable to financial institu
tions. b. Acceptable to the Fed and
other regulators, c. Proved by actual ex
perience, d. Conducive to additional
benefits.
So with 8% required cash assets, of
which about 1/2% is vault cash, the lati
tude each banker would have to keep
over 6% at a correspondent bank doesn’t
harm the effectiveness of monetary
policy. A fulcrum still is present in the
1/2%, if not the full 8%. And since the
“pyramiding” of balances among cor
respondents would be predictable, the
Fed’s monetary managers would esti
mate a new multiplier to predict the
relationship between the high-powered
reserves and money supply.3 This mul
tiplier would be as predictable as the
other, behavior-affected variables pol
icymakers predict every day. Most im
portantly, the linkage would be tight
between reserves and total demand de
posits because reserve requirements
would be the same for all institutions.
Open market operations benefit be
cause: 1. The reserve base is derived
from accurate data. 2, Achievement of
related levels of money supply would
lead to predictable results in economic
activity. 3. Elimination of differential
reserves between member and non
member banks would end the unpre
dictability of to what extent deposits
can be supported by a given volume of
bank reserves. The linkage between
bank reserves and deposits would be
Achieving the objectives of monetary
policy depends primarily on the system’s
ability to control the availability of mem
ber bank reserves, rather than on a par
ticular average level of prescribed reserve
ratios. Required reserves can perform their
fulcrum function even when set at a rela
tively low level.” George Garvey, “Reform
of Reserve Requirements,” Monthly Re
view, Federal Reserve Bank of New York,
August, 1972, pp. 201-207.
8 “Assuming the composition of minimum
reserves is allowed in correspondent bal
ances, the multiplier would be larger and
for a while more unstable . . . but pat
terns of predictability would develop.”
“Toward More Uniform Reserve Require
ments,” Business Conditions, Federal Re
serve Bank of Chicago, March, 1974, pp.
3-12.

MID-CONTINENT BANKER for May 1, 1977

m
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To find out m ore about th e B .A .G . p rogram , ju st talk to you r
H arland S ales R ep resen tative.

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Federal Reserve Bank of St. Louis

W&\RiAND
P.O. Box 105250, Atlanta, Ga. 30348

increasingly predictable. 4. Policymak
ers’ decisions would be helped by re
duced uncertainty about the effects of
open market operations on bank de
posits, on cost and availability of loan
able funds and also on aggregate de
mand for goods and services.
With currently declining member
ship hindering chances of devising a
system for frequently tracking data
from all banks, the Fed’s policymaking
team is likely to miss targets for money
supply and economic activity. I’m sug
gesting a structure that generates a
unified financial system, with frequent
reporting of deposit data for monetary
policymaking. This would help the cen

tral bank influence the pace of eco
nomic activity toward stability.
With Fed membership logically at
tractive, financial institutions would
sign up as members across the financial
marketplace. Also, a comprehensive
brotherhood of every institution nation
wide would yield a long-sought net
work, a blanket of data-gathering out
posts—over 14,000 head-office com
mercial banks alone. Statistical reports
nonmember banks had submitted in
frequently to other supervisory author
ities would be received frequently.4
And, most importantly, reportings of
data would be systematized into an ag
gregative overview of national eco

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Your rrCorrespondent” for Municipal Bonds

nomic trends. Such an overview of
“what’s happening” would provide
many benefits to banks and to society
by enhancing central bank stabilization
results.
Com prom ise N eed ed . “The history
of endeavors to achieve a more equi
table and more defensible system of re
serve requirements and to reassess its
(their) role in relation to other instru
ments of monetary control is a good
example of the difficulty o f finding
practical solutions to com plex problem s,
of achieving a sufficiently broad ag ree
m ent w ithin th e system w hen the p rob
lem at han d has considerably different
regional aspects and of the interplay
between academic discussion and in
ternal system efforts.”5
It’s difficult to achieve agreement
when the problem at hand impacts
several power groups.
Political Rationales M ediated. “The
United States is the only major country
in which the central bank doesn’t have
the power to regulate reserves of de
pository institutions other than com
mercial banks, even though the bulk of
savings and other time deposits is kept
with these other institutions.
“In no other country is the effective
ness of the central bank limited by
making membership, and thus com
pliance with its reserve regulations,
voluntary for a significant element of
commercial banks.”6
The framework presented here for a
low-key, free-market system of 8% cash
reserves, 12% additional earning liquid
ity assets and expectations of sound
managerial prudency is, therefore, a
desirable option each financial profes
sional would be wise to consider. Be
sides circum venting less desirable man
dates by the Fed, this compromise may
substitute for the vested-interest pro
posals initiated by every group con
cerned with its sphere of power.
New reserve plans considered in the
past increased the reserve burden for
some portion of the marketplace. Many
current plans impact private financial
institutions in varying degrees, but im
posing a new cost or burden on some
group of people. When a group per
ceives a negative impact on itself, its
predictable response is to oppose the
idea. Therefore, power groups can fore
stall any proposal.
Power structures within the private
financial system are real and potent.
Just naming a few confirms their

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4 Ira Kaminow, “Falling Fed Membership
and Eroding Monetary Control: What Can
Be Done?,” Business Review, Federal Re
serve Bank of Philadelphia, June, 1974,
pp. 3-15.
6 Garvey, “Reform,” p. 204.
6 Garvey, “Reform,” p. 205.

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

strength: nonmember banks, indepen
dent bankers, S&Ls, credit unions,
mutual savings banks and housing and
mortgage market participants.
Summary.
I believe the strength of my proposal
comes from its value to each of these
power structures. It’s a step toward less
regulation and increased management
flexibility. Every financial institution
would benefit.
Equity is achieved among compet
ing financial institutions. Each would
meet intuitive levels of cash reserves.
The few who would disparage any pro
posal should be categorized by this
plan’s proponents and labeled for the
small portion of opinion they represent.
A banker’s objectives include attain
ing best earnings, working at improved
stability for depositors, borrowers, stock
holders, directors and the banker. Each
group benefits as results include better
earnings and stability. This simplified
change in reserve requirements would
increase the opportunities for higher re
turns on assets.
Both the 8% and 20% rules-of-thumb
meet Fed objectives; each yardstick is
no higher than what prudency would
choose, so financial managers would
support them; both yardsticks provide
management latitude to pursue in
creased earnings; the only significant
disincentive to Fed membership—
forced high levels of non-earning as
sets— would be ended; membership
would become attractive; widely ex
panded membership would evolve as
individual money managers logically
appraise the value of benefits at the
Fed and realize their costs as no long
er burdensome; widely expanded mem
bership would yield a data-gathering
network of helpful institutions; policy
making decisions would be helped
by timely information flows, and pol
icy actions would achieve stabilization
results closer to targeted goals, which
benefit every citizen and financial in
stitution.
An alternative framework of reserye
requirements must meet the needs of
society, the Fed and others as financial
market regulators, the Fed as monetary
policymaker, present member com
mercial banks, present nonmember
commercial banks and other financial
institutions. This structure focuses on
these simultaneous needs and, through
systematic compromise of unneeded
structures, yields a new plan. Its frame
work of percentages and asset compo
sition meets the multiple needs of the
many vested interests. And important
ly, every financial institution’s officers
would have an assured opportunity to
pursue added earnings within this
structure. Even for current, nonmem

impact is significant over the long run,
to the extent this structure prevents
congressional forcing of complexities on
all financial institutions.
The proposal extends the massive
contributions of several professionals,
writers who have sought similar modi
fications to cumbersome reserve re
quirements. Many have urged adoption
of uniform requirements toward some
existing regulation and often involved
costs for many institutions. One under
lying strength of my proposal is its
hard, persistent effort to develop a
workable compromise where costs are
circumvented. This proposal finds that

ber Illinois banks, the plan s earnings
MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

the unencumbered precedents set under
unique Illinois conditions have deliv
ered to the U. S. financial system—to
use or ignore— a simplified structure of
financial cash reserves benefiting Amer
icans and their money managers. • *

EDITOR’S NOTE: Information regard
ing a simplified reserve rule may be ob
tained by writing: Larry C. Hempel, As
sistant Vice President and Market Man
ager-Commercial, First National Bank,
Broadway, Locust, Olive and Sixth Streets,
St. Louis, MO 63166.

/ ,M/ [1 f1

\--------- 7

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Douglas man to you.

O n th e C over— U p p e r le ft: M irro re d tu n n e l le a d s fro m p a rk in g g a ra g e
to s k y lig h te d re m o te lo b b y a t First N a t'l, A m a rillo . U p p e r rig h t: Suble ve l o f b a n k 's n e w b u ild in g co n ta in s c e n tra l p o o l fe d b y " r a in m a k e r "
th a t e x te n d s th ro u g h a triu m o f b u ild in g . B o tto m (a n d a b o v e , th is p a g e ):

First N a tio n a l's n e w hom e is s itu a te d on a n g le on b lo c k -s q u a re site in
d o w n to w n A m a rillo . S tru ctu re fe a tu re s e a rth -to n e b ric k a n d b ro n z e c o lo re d glass, is a d o rn e d w ith s ty liz e d lo g o . P ro je ct's cost w a s $ 16 m illio n ,

Dedication Ceremonies Set for May 22
For First of Amarillo's New Complex
Governor to participate at opening
STRUCTURE uniquely suited to
the mood and features of the
Texas high plains will become the
home of First National of Amarillo late
this month.
Texas Governor Dolph Briscoe will
join bank officials and a number of
special guests in dedication ceremonies
for First National’s new banking house
on May 22. The dedication will mark
the conclusion of a construction effort
in progress for more than two years,
at a cost of $16 million.
First National’s new home is an ar
chitectural innovation for northwest
Texas. The banking house is not a
building, but rather a complex that ex
tends over three entire city blocks of
downtown Amarillo and portions of
two other blocks.
The complex contains 244,000 gross
square feet of banking and office space
and the architectural concept is hori
zontal to harmonize with the broad
plains of the Panhandle region.
The main building is a massive
sweep of earth-tone brick and bronzecolored glass, covering almost an entire
city block. Each of the six levels of
the main building is equivalent in floor
space to four floors of a conventional
high-rise office building.
The most celebrated feature in the
design of the main building is the
atrium, a 90-foot-square open area ex
tending through the center of the struc
ture to a rooftop skylight. On the main

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Federal Reserve Bank of St. Louis

level, the atrium is graced by 12 large
ficus trees, which remain green indoors
throughout the year, and by smaller
growing plants. All of the upper levels
overlook the garden-like scene created
by the sunlit atrium.
Suspended in the middle of the
atrium is a gleaming column of stain
less steel called “the rainmaker,” which
pours a continuous shower of water in
to a pool on the sub-level of the atrium.
The distinctive qualities of First Na
tional’s home are more than decorative;
they are also symbolic of the region
served by the bank. Interior and ex
terior hues are reminiscent of the col
oration of the land, the foundation of
so much of the Panhandle’s wealth.
The emphasis on sunlight inside the
building is a reminder of the bright
skies to which Panhandle residents are
accustomed. And the inclusion of
greenery and water in the interior de

G ene E d w a rd s is ch.
& pres., First N a t'l,
A m a rillo ,
w h ic h
he
jo in e d in 1949. He w a s
elected pres, in 1964,
CEO in 1969 a n d ch.
in 1975. He served as
pres., Texas B ankers
A s s o c ia tio n , in 197475.

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cor reflects the importance of those
commodities to people who live on the
plains.
The horizontal concept also permits
an unusually orderly and convenient
arrangement of bank services. All of
the bank departments used most by the
public are consolidated on the main
and sub-levels. Those two levels are
linked by an open stairwell in the
atrium, as well as by the four elevators
that serve all levels. The sub-level also
houses a restaurant and barbershop.
Commercial lending activities, execu
tive offices, board and staff meeting
rooms are situated on the second level,
and all of the functions involved in
bank administration and operations are
concentrated on the third level. The
trust department occupies a portion of
the fourth level, with the remainder of
that level leased to tenants. The fifth
level contains lease space and a dining
room for bank officials and guests.
Attention to convenience radiates
from the main building throughout the
entire complex. Two full city blocks
adjacent to the main building are de
voted to parking facilities, providing
space for more than 600 vehicles. Al
most half of those spaces are under
cover in a four-level parking garage.
An underground tunnel connects the
garage with the sub-level of the main
building, providing customer comfort
in all weather.
The parking building also houses one

MID-CONTINENT BANKER for May 1, 1977

T w e n ty -fo u r-h o u r b a n k in g service is a v a ila b le
a t First o f A m a r illo th ro u g h a n e le ctro n ic te lle r
a n d n ig h t d e p o s ito ry in g a ra g e lo b b y , a d
ja c e n t to m a in b u ild in g .

of three electronic tellers and a night
depository, accessible at all hours in a
secure, well-lighted lobby. The site of
the new structure is directly across the
street from First National’s two existing
motor banks.
The complex is unified not only by
the proximity of the facilities, but also
by appearance. There is a compatibility
in the exteriors of both the existing and
new buildings, and an extensive land
scaping effort has blended the separate
elements into an entity. More than 140
trees and 5,000 square yards of Ken
tucky bluegrass were planted around
the main building and parking area.
There are four varieties of trees—
Texas red oak, crab apple, yaupon and
purple-leaved plum—and 10 varieties
of shrubbery and ground cover.
Amid the aesthetic touches and con
veniences of the new banking house,
the practical considerations of operat
ing a bank have not been overlooked.
A sophisticated security network pro
tects all areas of the bank with such
features as a Mosler proprietary alarm
system, a radio communication system,
30 TV cameras and a central security
monitoring area on the sub-level. All
offices are served by a sound system
and a 10-station pneumatic tube system
provides easy transmittal of documents
between levels. A variable-volume
heating and air conditioning system en
sures energy-conserving indoor com
fort.
More than just a new landmark for
Amarillo, the First National complex
has become, to many Panhandle peo
ple, a symbol of economic confidence.
At the time the project was announced,
the bank’s directors said their decision
was substantially influenced by the
faith they have in the future of Amaril
lo and the Texas Panhandle. Later, at
the groundbreaking ceremony, Gene
Edwards, chairman and president of
the. bank, commented: “We are build
ing more than a banking house; we are
building confidence in the Panhandle.”
From the bank’s willingness to invest
in a new home, the people of the re
gion have gained a renewed enthusi

asm in the Panhandle’s prospects.
The example of confidence follows
a tradition established at the time of
the bank’s beginnings. Founded in
1889, before Amarillo was incorporat
ed, First National was one of the forces
that shaped the city’s first business dis
trict. Shortly after receiving its charter,
the bank built what was to be, for
many years, one of Amarillo’s most im
posing stone buildings. In the late
1940s, the bank constructed one of the
first modern office buildings in Amarillo
—which served as the bank’s home
until the completion of the new com
plex.
Now said to be the largest bank be
tween Denver and Fort Worth, First
National began 1977 with total de
posits of $345 million and loans of
more than $205 million. Assets are
more than $409 million. The list of
stockholders recently reached 1,000,
most of whom are residents of Amarillo
and the surrounding region. • •

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

M o s le r p r o p r ie ta r y a la rm system lo c a te d in suble v e l o f b a n k e na b le s s e c u rity office rs to m o n i
to r e n tire b u ild in g .

N in e ty -fo o t-s q u a re a triu m is fo c a l p o in t o f
b a n k 's in te rio r, fe a tu re s p o tte d tre e s, b ro n z e c o lo re d s k y lig h t a n d sta in less steel co lu m n ,
c a lle d " r a in m a k e r ."

OW Accounts
FHeavy F
At Independents’ Convention
p p o s it io n

to the spread of

now

O accounts (negotiable orders of
withdrawal) was unanimously voted in
a resolution at the Independent Bank
ers Association of America’s 47th an
nual convention in Washington, D. C.,
in March. This opposition also was
voiced in several speeches, including
that of outgoing IBAA P r e s id e n t
Charles O. Maddox Jr., president, Peo
ples Bank, Winder, Ga. His remarks ap
pear on page 26.
“To date,” says the IBAA resolution,
“data available from the New England
NOW experiment and federal studies
confirm IBAA’s fears that payment-ofinterest costs must be passed on to
those who can least afford increased
service charges and higher loan rates
necessary to pay for NOW-type ser
vices—namely, young families, low- and
moderate-income people and minori
ties.”
That view was echoed by Repre
sentative Butler Derrick (D .,S.C .),
main speaker at the final general ses
sion. “I fought NOW accounts on the
floor of the House in 1975,” he told the
IBAA, “and my position has not changed

E n jo yin g b re a k fa s t d u rin g IB A A c o n v e n tio n in
W a s h in g to n , D. C., a re M r. a n d M rs. H a ro ld
N y e a n d son, R on a ld . M r. N ye is v .p . & cash.,
First S tate, Round Lake, III.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

C ha rle s O . M a d d o x Jr. (I.), o u tg o in g IB A A
pres., is p ic tu re d w ith n e w a s s o c ia tio n officers
(I. to r.): Iv a n D. Fugate, 1st v .p .; Don O s tra n d ,
tre a s .; E d w a rd A . T ra u tz , pres.; a n d R aym ond
D. C a m p b e ll, 2 n d v .p .

one bit.” He cited a South Carolina
Bankers Association study, which fore
cast an adverse impact from the ac
counts, especially on the state’s small
and independent banks.
Congressman Derrick u rg e d th e
bankers to express their opposition to
NOWs with their congressmen, but to
formulate fallback positions should en
abling legislation pass. (Federal Re
serve Board Chairman Arthur Burns
has announced a stand in favor of na
tionwide NOW accounts.)
A panel comprised of senior House
and Senate Banking Committee staff
members drew heavy fire from the In
dependents for championing NOWs. A
House Banking Committee spokesman
noted a split was forming within the
industry as previously staunch opposi
tion to NOWs thaws among certain
banking sectors. He warned the Inde

M r. a n d M rs. John N o rth c u tt p re p a re to le a ve
a fte r fin is h in g b re a k fa s t d u rin g co n v e n tio n .
M r. N o rth c u tt is pres., A la m o (Tex.) B ank.

pendents that their association’s nega
tivism will isolate the association from
an industry mainstream that’s warming
toward reform. Former IBAA President
Fred T. Brooks, president, Merchants
State, Dallas, disavowed the negativist
label and said, “We were right on Reg
ulation J. W e were right on E F T and
were instrumental in getting the (E F T )
commission’s study underway. W e were
right on customer-bank communication
terminals (CBC Ts) and have been up
held in the Supreme Court on the is
sue. And we’re right on the McFadden
Act and share drafts now.”
Payment of interest on demand de
posits was discussed by Alex Sheshunoff, president, Sheshunoff & Co., Austin,
Tex. Taking a stand against the pro
posal, he asked his listeners to focus
on who will pick up the tab.
“First,” said Mr. Sheshunoff, “there
is no such thing as a Tree lunch’ or
Tree interest on demand deposits.’ The
tab will be higher interest rates on,
loans, higher service charges on check
ing accounts and, in the short run, re
duced bank profits.
“The effect and the bank’s response

P icture d a t IB A A c o n v e n tio n b re a k fa s t a re
H e n ry T a y lo r, pres., First S e cu rity B a n k, Is la n d ,
K y., M rs. T a y lo r a n d M rs .' M a rs h a ll Barnes.
M rs. Barnes is w ife o f pres., B e a ver D am (K y.)
D ep o sit B ank.

MID-CONTINENT BANKER for May I , 1977

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WANTS YOU TO
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we’ve been guaranteeing and servicing inventory collateral for over 50 years.
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how we can help you say
“Yes” but with caution
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SLT

WAREHOUSE COMPANY

P.0. Bo* 242. St. Louis, Mo. 63166 • 314/241-975 0 • Offices in Major Cities
NATIONWIDE COLLATERAL CONTROL SERVICES

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

will be the same for every bank in
America. . .
“The typical bank customer will end
up picking up the tab of this windfall
annuity to the few bank customers who
keep large amounts of deposits—cor
porations, wealthy individuals, etc.
“Second, the cost of banking for the
average American under 45 will go up
significantly. . . . “W e believe the mes
sage to your customers is very simple:
Tf you owe more than you keep in
your checking account, you will be
paying an additional interest charge al
most directly to the bank’s wealthiest
customers who keep big deposits in
their checking accounts. That’s h alf
the tab for this ‘free lunch.’ The other
half is increased service charges on
each check you write. Hence, if you
spend most of each paycheck paying
bills, your service charge per check is
going to increase, and most of that in
crease will go directly to the bank’s
big demand-deposit-account customers.
You will, of course, receive a small re
bate on your average balance.’
“That’s the effect on your average
customer.”
Mr. Sheshunoff also proposed taxexempt loans to small businesses similar
to municipal-bond income. He said
these new loans would have to meet
the following criteria: 1. They would
have to be new loans, not refinancing
of existing debt. 2. Only loans to small
business would qualify as defined by
Small Business Administration stan
dards. 3. Loans would be made only
at the prime rate. 4. Only a specific
portion of a bank’s assets or deposits
could be in these loans.
He foresees these advantages of such
loans: 1. The economic impact would
be felt quickly as the funds were put to
work. 2. The cost of money for these
small businesses now would be on a
par with their larger competitors. 3.
The return to the bank could compen
sate for the higher risk associated with
lending to small business. 4. The ad
ministrative cost would be nominal;
the loans simply would be segregated
for examination and tax purposes. 5.
With banks having the ability to reg
ulate the percent of their assets per
mitted in these loans, an important new
instrument of monetary policy would
be created that could be applied reg
ionally as well as nationally.
Remote service units (RSU s) now
being operated by federal S&Ls came
under fire at the IBAA convention.
Meyer Eisenberg, a Washington, D. C.,
attorney retained by the association,
said that the IBAA has filed suit against
the Federal Home Loan Bank Board
declaring its RSU regulation illegal.
According to Mr. Eisenberg, RSUs al
low federal S&Ls to offer the function
al equivalent of commercial-bank check

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Federal Reserve Bank of St. Louis

ing accounts, which pay interest, with
out the burden of meeting specific reg
ulatory requirements imposed on com
mercial banks.
“The IBAA suit,” continued Mr.
Eisenberg, “raises a legal cloud over
the RSU program, which points up the
very real possibility that the courts
will declare the savings & loans’ RSU
expansion illegal.”
He said the IBAA case probably will
be submitted for decision this fall to
the District of Columbia Federal Dis
trict Court.
In his report as IBAA president, Mr.
Maddox referred to the National Com
mission on Electronic Fund Transfers’
recent interim report, which, in es
sence, asks Congress not to construe
automatic tellers and terminal devices
as branches and to allow their exten
sion beyond state lines. Mr. Maddox
pointed out that the IBAA vigorously
opposes this approach, and its initial
position has been sustained by the U. S.
Supreme Court.
The association, he continued, has
not opposed E F T S development, but
has requested first, that there be guar
anteed right of access; second, that
E F T remain under state control; third,
that rates charged for utilization be
nondiscriminatory; and fourth, that
there be some type of public-utility
approach to help achieve standardiza
tion in technological developments. He
said the IBAA employed Peat, Mar
wick, Mitchell & Co. to prepare a study

Employee-Assistance Program
ST. LOUIS— First National has
announced an employee-assistance
program, which is designed to help
employees and their families resolve
any personal problems that might
affect their job performance. The
program is available to personnel at
the bank and at St. Louis Union
Trust Co.
“The goal of this new program,”
Clarence C. Barksdale, chairman,
First National, and Eugene F. W il
liams Jr., chairman, St. Louis Union
Trust, said in a letter to employees
and their families, “is to aid and re
tain valued employees whenever pos
sible by offering professional and con
fidential assistance to any employee
or family member experiencing a
personal problem which is getting
out of hand.”
To help develop the program, the
bank and trust company have con
tracted with Personal Performance
Consultants (P P C ), a St. Louis firm
specializing in employee-assistance
programs. Program coordinator is
Mitzi Chandler, head of the health
services department for the bank
and trust company.

dealing with the impact of E F T sys
tems, and that study was made avail
able to the commission.
Resolutions. Besides the resolution
opposing nationwide NOW accounts,
the IBAA, among other things:
• Reaffirmed its “strong opposition
to concentration of financial resources
through further geographical expansion
of branching.”
• Called for a national agricultural
policy that would assure “equity in the
marketplace, adequate energy to en
sure production, stability in the trans
portation sector and an environmental
policy fair to the farmer and to the
consumer.”
• Recommended that limitations on
farm-ownership loans made by the
Farmers Home Administration be raised
from $100,000 to $500,000 and on
farm-operating loans from $50,000 to
$500,000; for guaranteed loans, the
limit per borrower should be $500,000
for farm-operating loans and $500,000
for livestock loans, farm-ownership
loans and farm-operating loans, to be
written in such a manner as to make
them eligible for secondary marketing.
• Resolved to seek legislation to re
voke the Federal Trade Commission
regulation overruling the holder-in-duecourse rule in connection with loans
made for purchase of goods and ser
vices.
• Urged exemption of one-bank HCs
with banking assets of less than $50
million and nonbank assets of less than
$15 million from all provisions of the
Federal Bank Holding Company Act.
The association declared that the pres
ent act makes it “extremely difficult to
transfer a small bank from one inde
pendent owner to another where a
one-bank HC is involved in the trans
fer.”
• Asked that Fed regulations be
amended to prohibit multibank HCs
from achieving “secret takeovers” of
banks by means of tender offers.
• Called for extension of deposit in
terest-rate ceilings—Regulation Q— and
elimination of a provision in the law
permitting thrift institutions to pay %%
more for savings than commercial
banks can pay.
N ew Officers. Edward A. Trautz,
president, East Lansing (M ich.) State,
succeeded Mr. Maddox as IBAA presi
dent. Other new officers are: first vice
president, Ivan D. Fugate, chairman
and president, Western National, Den
ver; second vice president, Raymond D.
Campbell, president and CEO, Oberlin
(O .) Savings Bank Co.; and treasurer,
Don R. Ostrand, vice president and
head of the correspondent bank divi
sion, First National, Omaha.
The 1978 convention will be held
March 5-9 at the Diplomat Hotel,
Hollywood, Fla. • *

MID-CONTINENT BANKER for May 1, 1977

Cash or charge.
These two machines will make
shopping quicker and easier.

Point-of-sale term inals provide
immediate authorization and print
receipts automatically.

Transaction telephones make
authorizations quick and
convenient:

A new dimension of time-saving efficiency for bank cards is coming to the Via
system. Soon, point-of-sale terminals in Via Buy 'n Bank locations will not only
give you direct access to your bank account, but provide immediate authorization
for BankAmericard, Visa, and Master Charge as well. Plus print out a completed
bank card receipt automatically.
And at Check Guarantee locations, where Via makes checks as good as cash,
authorizations for these three charge cards can be handled quickly on our trans
action telephones.
These are services of The Fourth's new Kansas BankCard Center, which is
made up of hundreds of banks all across Kansas. It brings bank card operations for
thousands of merchants and tens of thousands of customers under one roof. And
it makes doing business quicker and easier for everybody.

For information, contact: (316) 261-4505.

TheFourth has all four.

TheFourth
A neighborhood bank
as big as Kansas itself.

Fourth National Bank & Trust Co.

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Wichita, Kansas 67202

This is n e w hom e o f S e cu rity N a t'l, Kansas C ity , K a n ., w h ic h held ope n house th e re A p r il 21-2 3 . V ie w
is fro m c o rn e r o f Seventh a n d A rm s tro n g , w ith e n tra n c e to n e w d riv e -u p b a n k a t le ft, A rm s tro n g
A v e n u e e n tra n ce in ce nte r a n d Seventh S treet e n tra n c e a t rig h t.

At Security Nat'l, Kansas City, Kan.:

Faith in Downtown Area
Illustrated W ith Opening
O f New Bank Building
AITH in its downtown or “Center
City” area was graphically affirmed
by Security National, Kansas City,
Kan., April 21-23, when the bank held
open house in its new home on the
southwest corner of Seventh Street and
Minnesota Avenue. The multimilliondollar, eight-floor contemporary struc
ture, containing 140,000 square feet
of floor area, joins a multilevel public
parking garage on the south. There’s
access to the latter building at various
levels of the bank building.
The new building is located at One
Security Plaza, west across Seventh
Street from the long-established loca
tion of Security National on the south
east corner of Seventh and Minnesota.
In announcing the opening of the
new quarters, President Gray Breidenthal said, “. . . Most of our employees
live in Kansas City, Kan., or Wyan
dotte County. Their commitment and
ours is to the future of this community.
. . . This new bank and office building
is our thanks for the growth that our
customers have brought us.
“Also, this is our firm suggestion to
others to invest in Center City.”
The garden (lower) level includes:
a four-station drive-up facility, with en
trance and exit on Armstrong Avenue;
the safe deposit department, with 12

This is S e cu rity N a t'l o f KCK's n e w lo b b y as
seen fro m in sid e gla ss custo m e r-se rvice e le
v a to r.

M o d u la r se a tin g u n its a re p la ce d in cu sto m e rlo u n g e a re a o f m a in lo b b y in n e w S e cu rity
N a t'l o f KCK b u ild in g . G lass cu sto m e r-se rvice
e le v a to r fro m w h ic h p h o to a b o v e w a s ta k e n
is lo c a te d a t rig h t.

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Federal Reserve Bank of St. Louis

booths and two conference rooms;
bond department; cash and securities
vaults; storage and utilities and em
ployees’ lounge and lunch rooms,
which can be used to accommodate
groups of up to 200 for meetings and
social events.
Principal public banking quarters are
on the street level, extending from
Armstrong Avenue to Minnesota Ave
nue, with entrances from Minnesota,
Seventh Street and Armstrong. Here
are located the following departments:
paying and receiving; discounts; state
ments; installment loans; correspondent
banking; commercial loans; real estate
and marketing. In addition, senior offi
cers have their offices here. The Minne
sota entrance also serves the office
building and is integrated with the
main banking lobby.
A mezzanine level accommodates
building services and banking areas
and also is connected to Level No. 4
of the municipal parking facility for
customer and tenant convenience. The
second floor is devoted principally
to the trust department; conference
rooms; boardroom; officers’ lounge; li
brary; dining rooms and areas for fu
ture expansion.
The third floor contains bookkeep
ing, proof and transit, cashier, auditor

MID-CONTINENT BANKER for May 1, 1977

MUNICIPAL BONDS
TAX EXEMPTION

The major attraction of state and municipal bonds is their ex
emption from the federal income tax. While income from cor
porate and other securities is subject to federal income taxes
ranging up to 70%, the interest on municipal bonds enjoys com
plete exemption from these levies. This means that each dollar
of income from municipal bonds is spendable— not just the re
mainder after the tax collector takes his due. Speculators are
not attracted to these securities because of this stable base.

K. R. ADAMS, Chairman of Board
JACK L. PERRY, President
NORMAN E. LEWIS, Vice-President, Secretary-Treasurer
ROBERT P. MILLER, Vice-President
GARY E. GREER, Vice-President
KAREN VAN VOORHEES, Cashier

PERRY, A D A M S & LE W IS SECURITIES, IN C .
•

In v e s tm e n t B a n k e rs

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

1012 Baltimore Ave. / Kansas City. Missouri 64105

| ^ Ofle^5/22f-4090

B o a rd ro o m in n e w S e cu rity N a t'l o f KCK b u ild in g is la rg e a n d
lo u n g e a re a as w e ll as tra d itio n a l ta b le a n d ch airs fo r d ire c to rs .

and computer operations. The fourth,
fifth and sixth floors, with 45,600
square feet of gross area, are for com
mercial rental occupancy. These floors
are served by two high-speed electric
elevators from the building lobby (off
Minnesota Avenue). The sixth floor is
designed to provide clear ceiling
heights of up to 11 feet, 6 inches for
special or exclusive types of tenant re
quirements.
The public banking areas on the

has c o m fo rta b le

garden and main levels and second
floor are served with a glass cab on a
hydraulic elevator to convey bank cus
tomers between these levels. All bankoccupied floors are served by an inhouse elevator for exclusive bank use
and security.
The structure is supported by intru
sion concrete piling extending to bed
rock; and the structural frame is fire
proofed structural steel with a fire
proofed metal and concrete electrified

B A N K IN G
CAREERS
Corporate Personnel Banking Division
offers a personalized and professional
service to the person seeking to ad
vance their career in the banking field.
For over 5 years we have served the
banking community from coast-to-coast
Through constant contact with leading
banks, we keep abreast of the current
employment situation. To you, the per
son seeking to further your career in
banking, this means a confidential job
search on a continuing basis. To the
bank, it means a reliable source to turn
to when seeking to fill a key position.
We currently have a number of excellent
career opportunities available in com
mercial, and trust banking. Salaries
range from $14,000 to $50,000, and
client banks assume all fee costs. If you
feel that now is the time to further youi
career then call or send your personal
resume to: Joe Kremer

D ata processing d e p a rtm e n t o f S ecurity N a t'l,
KCK, is lo ca te d on second flo o r o f b a n k 's n e w
q u a rte rs .

Autom obiles
Trucks
(2 ton or less)
Household Goods
Farm M achinery
M otorcycles

CORPORATE
PERSONNEL

I ANKI NG

floor system, providing maximum flexi
bility for electrical and telephone out
lets throughout the first through sixth
floors.
The building and bank lobby have
domestic travertine marble floors and
walls. The banking area has a custommade carpet throughout with accents
of ceramic tile at the tellers counter
and bank lobby elevator. Walls are
covered with off-white and gray vinyl.
Office walls are made of teakwood flexwood. Tellers counters, doors and desks
are of finished teakwood, and a rolling
grille separates the bank lobby from
the building lobby in off hours.
Floors two through six and the mez
zanine have a combination of carpet
and vinyl tile flooring and fire-resistant
gypsum dry wall partitions finished
with paint or vinyl wall covering. All
ceilings are acoustical tile with flushfluorescent lighting fixtures providing
100-foot-candle lighting.
The exterior design emphasizes the
vertical motif, terminating with an
apertured parapet of precast concrete,
bronze anodized aluminum window
frames, glazed and clear plate glass on
the first floor and bronze tinted glareand heat-reducing glass on all floors
above the first.
Because of the importance of energy
conservation and utilization of environ
mental resources, the new building is
served by an electric system that pro
vides year-round climate-control air
conditioning and supplemental directperimeter radiation for winter use.
The bank moved into its new home
March 4-6. • •

M o b ile Homes
RECREATIONAL VEHICLES
Snowm obiles
Boats and M otors
Travel Trailers
M o to r Homes

■M l

Division

1948-B S. Glenstone
Springfield, Missouri 65804
417-883-1212

EN CO

affiliate offices in principal cities
56

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1 977

Banks all over
the Southw est bank

^ \ o l l o C Republic National Bank is
O i l l ^ d l l d w B t h e major reason why. Dallas
itself has been a major factor in our growth in correspondent banking.
The city’s central location in the Southwest and its excellent distribution,
mail and transportation services make correspondent banking transactions
faster and much more efficient.
But there’s more to our
leadership in correspondent
banking than our location. Much
more. It’s an attitude of service.
For example, through Republic,
you can offer your customers a
full range of international banking
services. And be assured that
they will receive the quality of
service that you would provide
were you based in London or
Tokyo, or Hong Kong or in any
one of a number of other
strategic international
business centers.
That attitude extends to
each of our correspondent
banking services. You can take
advantage of our superb trust
department, yet maintain full
control of your customer’s
account. Your customers involved
with oil properties will especially
benefit from the services of our
highly respected petroleum and
minerals group.
Naturally, we can provide
virtually any banking service that
you and your customers may
need, from transaction services
to credit facilities.
In helping our correspondent banks grow, we’ve made Dallas the
correspondent banking center of the Southwest. And Republic National
Bank is Dallas.

Republic National Bank
is Dallas. M H
Member FDIC

MID-CONTINENT BANKER for May 1, 197 7

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Federal Reserve Bank of St. Louis

It’s go in g to be better than
“very g o o d ” in fa ct. It's go in g to be
super. A n d we can hardly wait.
W e re looking fo rw a rd to
seein g all o f our correspondent b a n k
in g friend s at the O ld H eid elb erg
Castle w hen the T ennessee
B a n k ers' A ssociation State

Butch Hagy

MID-CONTINENT BANKER for May 1, 1977

Convention m eets in G atlinburg on
M ay 1 5 -1 6 -1 7
W e believe it's g o in g to be one
o f the A sso cia tio ns best m eetings ever,
a n d all o f us will see all o f y o u there.
A c h tu n g ! O n e m ore thing

... have a scfe trip. A n d w e'll see
y o u at the C astle!

f l V First
A m erican
Nashville, Tennessee

Ross McClain

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Boatmen's Bank, Kansas City,
Opens New Headquarters Bldg.,
Cites 7-Year Growth Record
HEN Missouri bankers convene in
Kansas City this month for their
annual convention, they have an invita
tion from Boatmens Bank of KC to
visit its new headquarters building, lo
cated in City Center Square.
The bank formerly was called Balti
more Bank, but—on joining the St.
Louis-based bank HC Boatmens Bancshares, early last year—it took the
name Boatmen’s of KC to reflect the
new affiliation.
The pride the bank’s officers have
in the new quarters is matched by the
pride they have in Boatmen’s of KC’s
excellent growth record. Since 1969,
the bank has quintupled its total assets
for a 23% compound annual growth
rate. A bank spokesman points out that
fn 8% annual growth is the average in
Kansas City.
Boatmen’s total deposits have grown
from $32.8 million in 1969 to $108.3
million at year-end 1976. Loans have
shown a similar spurt, going from
$17.8 million to $76.2 million over the
same seven-year span. Percentage of
corporate loans to total loans has in
creased from 41% in 1969 to 75% today.
Total assets have quintupled, and prof
its have tripled.
The bankers at Boatmen’s of KC
initiated this climb by selecting two
major targets for their new-business ac
tivities— correspondent banks and new
growth companies. They started to
build a staff tailored to meet these po
tential customers’ needs and produced
a growth spurt in 1971, when C. Ted
McCarter, now president, was hired as
executive vice president and heir ap
parent to Walton Steele, then presi
dent. Mr. Steele and most of his officers
were facing retirement, and so the im
mediate need was to put together an
entirely new staff, which they did. Now
average age of the officers is 35.
In the correspondent-bank area, Mr.
McCarter explains his bank’s upstreamloan participations this way, “When a
banker calls us, if we know him and
feel he’s a good judge, we don’t send
someone down to pry among the appli
cant’s neighbors for information. We
trust the banker. W e’ll let him know
right away whether we’ll go in on the
deal.”

N e w hom e o f B o a tm e n 's B ank o f K ansas C ity
rises 26 stories to becom e th e la te s t a d d itio n
to c ity 's skylin e . B u ild in g is lo ca te d in C ity
C en te r Square.

In te re s tin g a n g le s a n d la rg e expa n se s o f glass
a re fe a tu re s o f n e w B o a tm e n's o f KC b u ild in g .

"T e lle rs is la n d " on m a in le ve l o f n e w B o a t
m e n's o f KC q u a rte rs can p ro v id e fa s t cus
to m e r service b y b e in g a b le to serve p a tro n s
on fo u r sides.

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Federal Reserve Bank of St. Louis

Downstream participations, he con
tinues, are assisted by the bank’s ag
gressive loan policy. “If a country
bank’s loan goes sour,” according to
Mr. McCarter, “and a city bank has
bought a participation credit in it,
legally it’s the country bank’s problem;
morally, it’s the city bank’s.”
Mr. McCarter says his bank has
built a network of quality relationships,
rather than going after quantity.
As for check-clearing services for
correspondent banks, Mr. McCarter
says Boatmen’s of KC has an advanced
computer system “only a phone call
and a cathode-ray tube away” at the
HC’s lead bank, Boatmen’s National
of St. Louis. To add to this service,
Boatmen’s of KC recently joined the
Federal Reserve System, as Mr. Mc
Carter points out, at a time when many
banks are dropping out of the Fed.
The bank’s 8% correspondent-de
posit/ total-deposit ratio may be ex
plained by the fact that three of its
top officers, including Mr. McCarter,
started out in correspondent banking.
They learned about the problems— and
opportunities—from country bankers
themselves.
The other area of major growth has
been Boatmen’s emphasis on loans to
entrepreneurs. Mr. McCarter says his
bank has achieved much of its growth
because it’s willing to listen to anyone’s
proposal and seems to have the ability
to recognize a good business idea when
it’s presented to the bank. He adds
that this growth wasn’t attained
through acquiring other banks and by
taking accounts away from other insti
tutions.
Boatmen’s of KC believes it has an
enviable track record and that it at
tained it by following the marketing
axiom, “Find out what people want
and give it to them.” * *
P icture d in n e w b u ild in g a re (I. to r.): Ilus
D avis, ch., B o a tm e n 's o f KC; D. Eugene O 'C o n
n er, e .v .p .; a n d C. Ted M c C a rte r, pres.

iu u i

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Our international involvement
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Federal Reserve Bank of St. Louis

helping to establish the first merchant
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New hotel, Superdome play host to 1,900 attendees
HEN ATTENDANCE at a state
bankers association convention
jumps 30% from one year to the next,
somebody must be doing something
right! That’s what happened at this
year’s 77th annual Louisiana Bankers
Association annual meeting, held in
New Orleans last month. More than
1,900 were on hand for the three-day
event.
Credit for the attendance figure leap
can be given to the LBA and its Baton
Rouge-headquartered staff for selecting
the spanking new Hyatt Regency Hotel
for its convention site, not to mention
the adjacent Superdome as the site of
the “Super Party,” the first official so
cial event of the convention.
Other factors responsible for the at
tendance record include a special busi
ness session geared to directors and a
50% increase in the number of exhibitors
showing their wares in the French
Market exhibition hall.
This was the first LBA convention
to be held in the early part of April.
The date was moved up in response to
the recently advanced opening date of
the Louisiana legislature, which began
its session this year on April 18. It’s
LBA policy to convene prior to the
opening of the state legislature so
banking can present a unified stance
to state solons.

By JIM FABIAN
Associate Editor

O u tg o in g LBA Pres. D on a ld L. D elca m b re , pres.,
S tate N a t'l, N e w Ib e ria , a t lectern d u rin g firs t
business session o f c o n v e n tio n w h e n he d e
liv e re d p re s id e n t's re p o rt.

And unity among bankers is espe
cially desirable this year, when the
LBA will be sponsoring an E F T bill in
the statehouse. During the convention,

N e w LBA officers w e re In s ta lle d a t co n v e n tio n . From I.: Pres. W a lte r B. S tu a rt III, v . ch.. First
N a t'l B a n k o f C om m erce, N e w O rle a n s ; Pres.-Elect Jam es G. B oyer, pres.. G u lf N a t'l, Lake
C h a rle s; Treas. John J. Doles Jr., pres., First S tate, P la in D e a lin g ; a n d EVP R ob e rt I. D id ie r Jr.,
B aton Rouge.

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the LBA legislative committee met to
recommend that the LBA board of di
rectors submit the committee’s E F T
bill draft to member CEOs for com
ment and/ or approval. According to
newly installed LBA President Walter
B. Stuart III, vice chairman, First Na
tional Bank of Commerce, New Or
leans, the LBA has until May 12 to file
the bill in the legislature. Prior to that
time, member CEOs are expected to
send their opinions of the bill to LBA
headquarters. “The LBA wants to
know which sections of the bill the
CEOs agree with as well as disagree
with,” Mr. Stuart said.
Mr. Stuart and the other new LBA
officers were installed at the conven
tion's closing banquet at the Hyatt
Regency on April 4. Serving with Mr.
Stuart are James G. Boyer, president,
Gulf National, Lake Charles—presi
dent-elect; and John J. Doles Jr., presi
dent, First State, Plain Dealing—trea
surer.
Elected to the LBA board for threeyear terms were Richard DuBois, ex
ecutive vice president, Gulf Coast
Bank, Abbeville; Crawford Bishop,
president, Bank of Gonzales; and Nor
man Gunn, senior vice president,
Rapides Bank, Alexandria.
Outgoing LBA President Donald L.
Delcambre, president, State National,
New Iberia, spoke during the first busi
ness session of the trials the association
has endured over the past year. Among
these were attempts to force the LBA
to abandon its traditional neutral posi
tion regarding bank structure change
in the state; the Baton Rouge E F T bill,
a complex issue supported by opposing
factions of well-meaning bankers; the
threat of suspension of bankers blanket
bond coverage in Louisiana by the
Surety Association of America; addi
tional federal regulations, especially
Regulation B; the closing of Interna
tional City Bank in New Orleans; the
issue of payment of interest on demand
deposits and the recommendation by
the Fed of NOW accounts on a nation
wide basis.
The LBA has faced and met each
of these problems, he said, winning
some and losing some. The association

MID-CONTINENT BANKER for May 1, 1977

By keeping in touch, your bank and the Whitney
can successfully work together. Now, as for
more than ninety years, the Whitney stands
ready to go to work with correspondent banks,
small and large, to achieve mutual progress.
It’s time for us to get to know each other better.
Correspond with us!
MID-CONTINENT BANKER for May 1, 1 9 7 7

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Federal Reserve Bank of St. Louis

LEFT: R aym o n d L. Bond, Bossier B ank, Bossier C ity ; Em bree K. E asterly,
C a p ita l B a n k, B a to n R ouge; W . B. D o n a ld Jr., J e ff Daviis Bank, Jen
nin g s. MIDDLE: R ichard Sale a n d M rs. Emma Fulle r, C o m m e rcia l N a t'l,

pspggH»B|

S h re v e p o rt; M rs. Hines; H erm a n H ines, D ep o sit G u a ra n ty N a t'l, Jackson
M iss. RIGHT: W . V a n S a lley, B ank o f Bernice; M rs. A ltic k ; Jam es A ltic k
C e n tra l B ank, M o n ro e .

■*.'*■+./*■+■/+

822*n
LEFT: W . W a rre n F uller, C om m e rcia l N a t'l, S h re v e p o rt; M rs. D ow les;
C a rre ll D ow les Jr., H om er N a t'l; M rs. B ro w n ; Dr. Jam es R. B ro w n ,
Ruston State. MIDDLE: Foursom e fro m N a t l A m e ric a n , N e w O rle a n s —
M ilto n Z e lle r (re ce n tly re tire d ); M rs. Z e lle r; Jack K ern; M rs. Kern.

continues to be deeply involved in find
ing solutions to the complex problems
that still face the state’s bankers.
Mr. Delcambre said that an E F T bill
is a “must” if the state’s banks are go
ing to compete effectively with thrifts.
He said the LBA has devised such a
bill, utilizing the input of bankers ex
pressing diverse viewpoints. As noted
earlier in this report, the bill will be in
troduced in the state legislature prior
to May 12.
Mr. Delcambre said the LBA is con

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Federal Reserve Bank of St. Louis

RIGHT: L. H. V id le r, B ank o f L o g a n s p o rt; Ed N o la n d , C om m e rcia l
S h re v e p o rt; K en ne th P ic k e rin g , sta te b a n k in g co m m issio n e r; M rs. F
in g .

sidering rewriting the Louisiana bank
ing code, but mast figure out how to
finance such a project first. He said the
code is antiquated and is in great need
of codification, at the very least. He
warned that, if some other group un
dertakes the revision job, banking
could suffer, since the group might not
be especially friendly to banking.
In the area of bankers blanket
bonds, Mr. Delcambre recommended
that the LBA work to make certain no
more big bank failures occur in the

B ankers
lik e
to
be
s u rro u n d e d b y w o m e n !
TOP: R e g is tra tio n Ch.
C ha rle s Foret is as
sisted b y Lin d a Eisw o r th (I.), N a t'l A m e r
ic a n ,
N ew
O rle a n s,
and
Frani
W h ittle ,
W h itn e y
N a t'l,
N ew
O rle a n s .
M r.
Foret
heads th e corres. d e p t,
at
N a t'l
A m e ric a n .
BOTTOM:
N ew
LBA
Pres. W a lte r B. S tu a rt
III is c o n g ra tu la te d b y
M a rs h a Bond (I.) a n d
D oris Rhodes (r.), b o th
o f B ank o f Z a c h a ry .
Second fro m I. is M rs.
S tu a rt.

state. He said it might be necessary to
organize a mutual bonding company
to handle BBB. The threat of organiz
ing such a firm could serve to deter
existing bonding companies from can
celing current BBB coverages in the
state.
He announced that marketing for
LAMACHA, the Louisiana-AlabamaMississippi Automated Clearing House
Association, is being assumed by LBA.
He urged banks that have not joined
the ACH yet to do so soon before
membership requirements change.
Mr. Delcambre is most concerned
about the movement to force banks to
pay interest on demand deposits. He
said that, a year ago, bankers were as
sured that such interest payments were
at least five years in the future. Now
they’re in the immediate future.
He said the Fed moved so fast in
this area because it had to do some
thing to curb the decline in member
ships; thus, it proposed a two-prong
program of paying member banks in
terest on their reserves at the Fed and
requiring member banks to pay interest
on demand deposits. He said the pro
posals are not in the best interest of
banking.
Another factor bringing on payment
of interest on demand deposits, he said,
is the fact that many banks have been
giving their services away free or at a
loss. The theory goes that payment of
interest on demand deposits will help
make up for the loss-leaders banks
have been offering their customers.
This is faulty reasoning, according to

MID-CONTINENT BANKER for May 1, 1977

First NBC knows what it means
cor*respond (k ô r 'i spond') v.i. 1: for a per
son, partnership, firm or corporation to carry
on business transactions with another at a
distance; esp: BANKING 2: to communicate
by letter, telegram or telephone, and, esp. at
First National Bank of Commerce, to com
municate on a personal level. Our corre
spondent banking officers understand all the
services you require and anticipate all your
needs. When you deal with us you know we
know the meaning of correspondent. For in
formation on First NBC’s correspondent
banking programs contact Doug Lore at
1/800/462-9511, within Louisiana, or 1/800/
535-9601, outside Louisiana.

F ir s t N a tio n a l B a n k o f C o m m e r c e
CORRESPONDENT BANKING DEPARTMENT

210 Baronne Street/New Orleans, Louisiana 70112/504-561-1473
Member FDIC
MID-CONTINENT BANKER for May 1, 197 7

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Federal Reserve Bank of St. Louis

Official greeters at bank-sponsored social events at LBA convention
included (from I.) Pat Willis, Fidelity Nat'l, Baton Rouge; Lawrence A.

Mr. Delcambre, because it would tend
to penalize banks without penalizing
thrifts. He said S&Ls could handle
NOW accounts at no charge to cus
tomers if they succeeded in getting a
1% reduction in the interest rate ceiling.
Mr. Delcambre cautioned Louisiana
bankers not to alter the LBA’s neutral
stance on bank structure because it
would result in a fractured organiza
tion. He called attention to the situa
tion in Illinois, where three state bank
ing associations compete with one
another. He advised his audience to do
nothing that would weaken the LBA,
since the association must present a

Merrigan and Jack A. Livaudais, Bank of New Orleans; and J. Clifford
Ourso Sr., American Bank, Baton Rouge.

Bankers should ask themselves what
their customers want and need in the
way of services. Then they should ask
themselves what their bank can offer
to meet the customer’s need. After that,
they should assess the competition and
ask what thrifts can offer customers of
banks.
Such questioning helps the ABA pre
pare itself to act instantly when a crisis
occurs, he said.
In the area of demand deposit inter
est, Mr. Milligan said such payments
will come to pass in the long run. In
the short run, he added, NOW ac
counts will be authorized for all finan-

ABA Pres.-Elect A. A.
"Bud"
Milligan
(I.)
chats with LBA officers
prior to opening of
business session. In
center is LBA Pres.Elect Walter B. Stuart
III, v. ch., First Nat'l
Bank of Commerce,
New Orleans, who de
livered invocation. At
r. is LBA Treas. George
S. Lensing, pres., Bank
of Dixie, Lake Provi
dence.

united front when facing the problems
of banking in Louisiana.
ABA President-Elect A. A. Milligan,
chairman, Bank of A. Levy, Oxnard,
Calif., was enthusiastically received by
the audience. He added to Mr. Delcambre’s theme by stating that the next
few years will be traumatic for bank
ing. Divisions are occurring in most
state banker associations, he said. He
predicted that the various banker asso
ciations in Illinois are going to be
“hanged one at a time” if they don’t
get together.
He said the ABA is attempting to
develop strategy to promote whatever
bankers want. He refuted the thought
that the ABA tells its members what
they want. The only way to achieve
consensus on what bankers want, he
added, is to be willing to compromise.
66

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Federal Reserve Bank of St. Louis

cial institutions, including credit un
ions. NOW account legislation is re
dundant, he added, but there has been
so much talk about it, and it has gath
ered so much momentum, that it can’t
be stopped. Yet there is a chance that
legislation might not pass right away.
The U. S. League of Savings Associa
tions is neutral on the issue, Mr. Milli
gan said. The S&Ls want others to push
for NOWs while they work hard to re
tain their one-quarter percent interest
differential.
Bankers should realize, he said, that
NOW accounts are strictly optional for
banks. He added that the bankers in
New England now wish they had made
a greater attempt to influence NOW
legislation when it was introduced.
They were so busy fighting it, they
neglected to foresee its passing. They

learned that a policy of boycott results
in cutting oneself out of policy forma
tion.
Mr. Milligan said banks are not
charging enough for bank services,
which, in effect, amounts to paying in
terest on demand deposits. He warned
that costs could engulf an unwary
banker. Services such as free checking
are extremely burdensome for some
banks, he said.
But there is some hope in the NOW
situation, he said. Due to the diverse
priorities of congressmen, the legisla
tion might be put off indefinitely.
Washington is on edge with its new
President, he added. Congress isn’t sure
what will and what will not please
President Carter, who seems to be
moving toward a pro-business position.
The President seems to be thinking
that increased business spending is nec
essary for economic stabilization, which
would tend to put a lid on soaring
government spending.
Mr. Milligan called attention to Sen
ate bill 77, which would permit a un
ion to call an election in a bank or
other place of business if it held cards
signed by 55% of the regular employees.
He called for the re-establishment of a
balance between labor and manage
ment and said bills like this one tend
to make management lose out in its
battle with labor.
He closed by saying that the ABA
believes that bankers should speak out
on all issues, not just those affecting
banking.
The second business session of the
convention was devoted to duties and
responsibilities of directors and new
examination procedures. Roy Jackson,
F D IC regional director, Memphis, was
the principal speaker. His remarks are
reprinted elsewhere in this issue.
Executive Vice President Bob Didier
Jr. announced that next year’s conven
tion will be held at the new Hilton
Hotel on the New Orleans riverfront.
The dates will be April 14-18. • •

MID-CONTINENT BANKER for May 1, 1977

These are
JOHNSON

“M I L L A R D

BAAS

M E N
■

JO S E P H F R A N C IS Q UIN LAN , JR .,

R O Y F. B A A S,

a young but seasoned BNO veteran,
joined BNO in 1971 and soon started
upward. An assistant vice president,
he has been manager of two of BNO’s
branch offices. A BS in finance from
UNO. Photography is a serious hobby
and he expects to use his cameras as
he travels picturesque Louisiana.

born in California, schooled in
Mississippi and New Orleans, with
major emphasis in universities on
banking and finance. He has since
attended LSU School of Banking and
the ABA Bank Card School at
University of Chicago. Married and
father of two. With his banking
experience and dedication, with
golf, hunting and fishing as
hobbies, he has great
requisites in Correspondent
Banking for value to you.

JA M E S O. JO H N SO N ,

BNO assistant VP, is a graduate of
“ Bear Bryant” university, holds a
bachelor’s degree in business, with
emphasis on sales and advertising. He
is a graduate of the School of Banking
of the South at LSU. So he has a broad
foundation for his banking ability and
proves it every day, to progressive
bankers in the Florida parishes, North
Louisiana, South Mississippi and
Alabama.
M ILLA RD W AGNON

is a banker’s banker. The most astute
bankers throughout this area find him
a rewarding friend and advisor. Long
on experience, young in vision and
thoroughly knowledgeable — that’s
the No. 1 Correspondent Banker,
Millard Wagnon.

B a n k e r s w ith I d e a s

BN ©

THE BAN K OF
N E W ORLEANS
AND TR U ST COMPANY

Member FD IC

C A LL: 1-800-462-9522 (Within Louisiana)
1-800-535-6760 (From Miss., Ala.,
Texas, Ark., Okla.)
MID-CONTINENT BANKER for May 1, 197 7

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Federal Reserve Bank of St. Louis

Louisiana Convention Speech

Directors Play Increasingly Important Role
In This Traumatic Period for Banking
E HAVE more-or-less emerged
from what has been described as
a traumatic period for our industry.
The recent recession has been de
scribed by some as the most severe
since the Great Depression of the
1930s.
I say “more-or-less emerged” because
the nature of the credits extended by
banks during this period are such as
to preclude quick recovery. Thus, al
though we are over a year and a half
past the low point of the recession, we
are still living with a rather long list
of problem banks. Not only do we have
a number of problem banks, which re
sult in my becoming acquainted with
directors involved in these banks, but
in 1976 we had the largest number
of bank failures— 16— since the early
1930s.
In a number of cases involving failed
banks, directors are finding themselves
involved with the FD IC , and in some
cases, with minority shareholders, in
defensive positions in lawsuits. And so,
it is appropriate that we discuss the
subject of directors’ responsibilities.
A good director is a highly ethical
individual who promotes the bank at
every opportunity; meets periodically
for an hour or so to review and express
an opinion—for the record—on trans
actions conducted since the previous
meeting, forgetting them afterwards;
evaluates the need for and provides
competent active management for the
bank; establishes, and polices adher
ence to, sound operating policies; car
ries the burden of seeing after the wel
fare of all the bank’s depositors;
subjects his personal fortunes to ex
posure for ill-considered deeds; and
does it all for peanuts.
The director is an essential part of
the business which has a unique im
pact upon the welfare of the public
and the economy. As a result, the job
of a bank director is not regarded in
the same light as that of a director of
any other kind of business. It has been
said of bank directors, “theirs is re
sponsibility which transcends the mere
protection of the stockholders’ invest
ment and becomes a public trust where
upon may depend the financial stability
and welfare of an entire community.”
Much has been written about the

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Federal Reserve Bank of St. Louis

By ROY E. JACKSON
FDIC Regional Director
Memphis
bank director and his ponderous re
sponsibilities, and many related opin
ions have been handed down by courts
attempting to address the issue. Per
haps we can consider the opinion of a
federal district court in Arkansas, in
the case of Rankin vs. Cooper. It ad
dresses essentially the same principles
contained in other opinions, but seems
to be something of a classic, being es
pecially clearly written.
Quoting from the court’s opinion:
“1. Directors are charged with the
duty of reasonable supervision over the
affairs of the bank. It is their duty to
use ordinary care and diligence in
ascertaining the condition of its busi
ness and to exercise reasonable control
and supervision over its affairs.
“2. They are not insurers or guar
antors of the fidelity and proper con
duct of the executive officers of the
bank, and they are not responsible for
losses resulting from their wrongful
acts or omissions, provided they have
exercised ordinary care in the discharge
of their own duties as directors.
“3. Ordinary care in this matter as
in other departments of the law means
that degree of care which ordinarily
prudent and diligent men would exer
cise under similar circumstances.”
In order for a director tp function

effectively, he or she has to show up.
Director absenteeism is a problem both
for the bank and the director himself.
If you are a director, and if actions
prejudicial to the bank’s welfare are
passed in your absence, it would be
well for you to be able to convince a
court that you made every possible ef
fort to be present.
Habitual absence, of course, would
affect your credibility. Asking a di
rector to resign due to irregular at
tendance is a difficult matter, especially
if he or she possesses compensating
strengths. It is better for a person to
serve in an advisory capacity if he is so
busy that the bank directorship is ig
nored. I would daresay that if there is
such a thing as “directors’ etiquette,”
it would call for such a director to offer
his resignation.
I am reminded of an entry in the
board minutes of one bank which went,
“It was moved by Director Green and
seconded by Director White that di
rectors’ fees be paid at the close of the
meeting instead of at the first.” I am
not suggesting that directors becoming
lost on their way to the washroom is
an area that merits any significant dis
cussion. This is the epitome of exhi
bition of lack of interest, but it can take
other forms, such as refusal to take part
in vital discussions or reduction of the
meeting to a bull session. A director
should make his presence felt. He
should be interested and he should be
inquisitive.
I recall the instance of one director
never voting in favor of anything.
There, in most cases, was no argument,
but when the vote was taken, this di
rector voted “no.” The fallacy of this
is obvious. This is not voting of con
science, it is simple contrariness, which
obviously would be of little conse
quence in a director’s liability suit. But
one important point should be made:
If a director feels a proposition is un
sound, he should express his views and
listen to the arguments. If the issue is
not resolved to his satisfaction, he
should exercise his right to vote against
the proposition, and he should be sure
that the negative vote is registered. As
is the case with all other essential bank
records, the minutes should be accurate,
and the board should see that any in-

MID-CONTINENT BANKER for May 1, 1 977

SECURITy
jC O R P O R flT IO n

Among exhibitors at convention were (from I.) Fred Scaggs and Harry
Kyle at Mosler booth; Joseph Montero III, Assumption Bank, Napoleonville, and Beril Bohrer at Bank Building Corp. booth; and quintet

manning Security Corp. booth: Joe Tierney, Bill Watkins, Mrs. Watkins,
Debbie Boese, Larry Grantham.

Exhibitors at LBA convention show off merchandise. From I.: Hugh Rooney at Diebold booth;
W. Merle Davis, American Bank, Baton Rouge, and Matt Libonati at Brandt booth; Mrs. Coco,
E. G. Coco and Marty Swift at LeFebure booth; and Marilyn Roberts with Mrs. Woodland and
Don L. Woodland at Creative Image booth. Mr. Woodland is asst, dir., School of Banking of
the South at LSU.

consistencies are corrected.
The active involvement of the board
in overseeing the bank’s operation is
becoming more important than ever.
The rules by which we play are be
coming increasingly difficult. Especially
critical is the selection of competent
officers upon which the board may rely.
The assistance and directions given
by the board must be responsive to the
complications arising in banking. The
board, in order to extend its influence
into the day-to-day operation of a bank,
must prescribe clear, workable policies.
I fail to see how a board can control
an operation, as it is sworn to do, with
out good lending and investment poli
cies. Otherwise, a director sees one sur
prise after another when reviewing
loans at board meetings. He or she also
is likely to see some surprises in reports
of examination.
There is an art to writing policy.
Basic to an effective policy is the aware
ness of the needs of the local com

munity. There seldom is a legitimate
reason to send a depositors’ funds out
side the trade area of the bank. Outof-area loans have been a common de
nominator in all too many bank fail
ures.
The bank’s written lending policy
should specifically address this subject.
L et’s discuss briefly the lending pol
icy of the bank. This policy should re
flect the types of collateral the bank
typically receives on its loans, specify
ing collateral margin requirements,
rates of interest to be applied based on
characteristics of the loan, the maxi
mum maturity on specified types of
collateral, individual lending limits for
the various officers, mechanics for ad
vance committee review of large and
unusual loans and other similar areas.
Also essential in writing loan policy is
a knowledge of the bank’s profit re
quirements. Otherwise, setting interest
rates would be highly inexact.
A loan policy should be useful. This

ST. M A R Y BAN K & TRUST CO .
FRANKLIN, LA.
S p e c ia l A t t e n t io n
to C o lle c t io n
a n d C a s h It e m s !
TO TAL RESO U R C ES
$ 2 2 M I L L IO N

|
'
■

ï
!

W . McKERALL O'NIELL, Pres.
DON T. CAFFERY, V.P.
EDMUND A. N A Q U IN ,
Vice President & Cashier

Top photo: Tom Welch visits with John W.
Holley, Ouchito Nat'l, Monroe, at Salem China
booth. Bottom photo: Rick Hudgens and John
Alford man Standard Life Insurance booth.

Specializing
in Louisiana and
Mississippi
Municipal Bonds

Hattier, Sanford
& Reynoir
IN V E S T M E N T

BA N KERS

Whitney Building, New Orleans, La. 70130
(504) 525-4171

Member F.D.I.C.

MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

implies it should be specific in the area
where strict guidance is needed. But it
should not laboriously attempt to cover
every imaginable situation; this would
cause the policy to be cumbersome and
less effective, not more effective.
Remember also that neither having
a law on the books nor having a written
loan policy is effective unless there is
follow-up and enforcement.
It is presumed that a director’s own
personal dealings with his bank will
be above board, both in rates charged
and in other terms. Granting of prefer
ential rates as a sort of hidden director’s
fee is not what a reasonable man would
consider fair and certainly should be
avoided. Directors should be paid an
equitable fee for their services and
should expect nothing further.
Another point of directors’ etiquette
is to avoid placing a personal matter
before the board when there is any
possibility that board approval of the
proposal would be in conflict with es
tablished policy. If any such possibility
exists, either remedy the deficiency be
fore presentation or try it out on an
other financial institution. It is not wise
to place other board members on the
spot on a personal matter. A good
board will reject an unacceptable pro
posal, even from a fellow board mem
ber. But this is not good for director
relations and, therefore, is not good for
the bank.
Among many individual interpreta
tions of the duties of bank directors,
the words “ordinary care and diligence”
seem to be a common thread. This
phrase is so easily understood that there
is no way to make it any clearer. But
in order to exercise ordinary care and
diligence, it must be assumed that the
director would make himself sufficiently
familiar with the operation of a bank
that he is aware of potential problem
areas.
It has been often said that no one is
perfect. This includes the bank director,
even though he may take every possi
ble avenue of familiarizing himself
with banks in general and with his own
bank. Therefore, in the usual course of
business, matters may slip by the cau
tious director.
Quoting further from the Arkansas
court opinion:
“6. Directors are not expected to
watch the routine of every day’s busi
ness, but they ought to have a general
knowledge of the manner in which the
bank’s business is conducted, and upon
what securities the larger lines of credit
are given and generally to know of and
give direction to the important and
general affairs of the bank.
“7. It is incumbent upon bank di
rectors in the exercise of ordinary pru
dence, and as a part of their duty of
general supervision, to cause an exam

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Federal Reserve Bank of St. Louis

ination of the condition and resources
of the bank to be made with reason
able frequency.”
Implicit in the court opinion is the
expectation that a director will not be
satisfied with the information he is re
ceiving and the opinions he is forming
based upon that information; rather,
he will create sources of information
for himself through periodic examina
tions and audits. Once received, audit
and examination reports—including reg
ulatory agency examination reports—
should be reviewed thoroughly and
acted on. These reports are conducted
for the benefit of the board in directing
the bank’s affairs in a safe and sound
manner.
The director should either act upon
or justify to himself why he should not
act upon recommendations made in
audit and examination reports. If there
is a lack of understanding of a recom
mendation or the need for the recom
mended action, ask questions of the
firm or agency preparing the report. It
is not always wise to rely solely on an
explanation from the executive officer
on whom the burden of implementation
of the recommendations would fall.
“5. If nothing has come to the (di
rector’s) knowledge to awaken suspi
cion that something is going wrong,
ordinary attention to the affairs of the
institution is sufficient. If, on the other
hand, directors know, or by the exer
cise of ordinary care, should have
known, any facts which would awaken
suspicion and put a prudent man on
his guard, then a degree of care com
mensurate with the evil to be avoided
is required, and a want of that care
makes him responsible. Directors can
not do justice to those who deal with
the bank if they shut their eyes to what
is going on around them.”
Reasonable men given identical in
formation often will arrive at vastly
different conclusions for several rea
sons, the most prominent of which is
a difference in philosophies. And we
can’t say that one is right and one is
wrong just because votes differ. If, how
ever, a director suspects the motives
of his colleagues or suspects that they
are simply hesitant to speak out against
a dominant board member, he could be
expected to take action even beyond a
negative vote. This action could even
take the form of a notification to the
appropriate regulatory bodies.
The background of the Arkansas case
is a suit against directors for lack of
ordinary care in performing official
duties. Lawsuits against directors are
not uncommon. Minority stockholders
occasionally feel wronged by directors
and seek legal redress against them.
Also, the FD IC as receiver of most
closed banks often finds cause to enter
suit against individual board members.

In many closed bank cases, the prob
lem can be traced to a disinterested,
lethargic board.
The corporation’s division of liqui
dation recently issued a statement con
cerning the role of management in
bank failures. A portion of the state
ment follows: “Generally speaking, di
rectors of closed banks . . . abandoned
their vital duties and functioned as
‘rubber stamp boards’ for the controlling
parties of the bank.”
There often is the feeling that the
bank owner is, in effect, spending his
own money, so why get in his way?
But this has nothing to do with the re
sponsibility to the bank’s depositors and
the degree of a director’s personal lia
bility. Even if the bank is 100% owned
by one entity, the director’s function is
not changed, nor is his legal liability
in the event of failure to discharge his
duties satisfactorily.
In instances where a bank is in se
vere trouble, it is not uncommon to find
an interested board. Its members ob
viously have not always been interest
ed, but became interested when the
situation deteriorated to a point of
questionable salvation. The degenera
tion of a bank into unsatisfactory status
is often an insidious proposition, fueled
by hesitancy of the board to take ac
tions that a prudent man would see as
absolutely imperative. Only when it is
too late do many boards act.
I have not sought to scare anyone
and I hope my words do not result in
a mass exodus from bank board rooms.
Rather, I hope I have merely en
couraged you to recognize your respon
sibility as bank directors— as well as
your liabilities. If nothing else is
achieved, perhaps you will at least be
challenged to participate in bank policy
decisions, to think, to judge. • •

■ GEORGE G. VATH has been elect
ed president, National American Bank,
New Orleans. He was formerly senior
executive vice president (since 1972)
and a director and permanent member
of the executive committee ( since
1975). He joined the bank in 1939 and
headed the business development, ad
vertising and public relations activities.

MID-CONTINENT BANKER for May 1, 1977

Louisiana Industrial Development
Tops $1 Billion for Third Year
By GILBERT C. LAGASSE
Secretary
Louisiana Department
Of Commerce
Baton Rouge

OR the third straight year, indus
trial investment in Louisiana topped
the $ 1-billion mark with $1,108,390,380 going into new. and expanded fa
cilities.
This investment reflected the loca
tion of 54 new manufacturing plants
and 319 expansions to existing facili
ties. These new plants and expansions
contributed $330,563,769 and $777,826,611, respectively, and generated
some 7,433 new, permanent jobs and
18,447 construction jobs.
Investment by category showed
petrochemicals and refining with $798,314,787; metals and machinery, $81,660,875; transportation, $43,845,400;
food products, $42,173,258; power
generation, $41,250,000; pulp and pa
per, $34,060,225; lumber and wood
products, $33,458,336; miscellaneous
products, $23,713,950; stone, clay,
glass and concrete, $6,068,597, and
textiles, $3,844,952.
The outlook for industrial growth in
1977 is for increased investment and
job creation. W e expect to surpass the
$ 1.5-billion investment mark and pos
sibly reach $2 billion. Several factors
will be responsible for this increased
economic growth.
The state has burgeoned into an im
portant marketplace for industrial and
consumer goods—something it was not
10 years ago. Geographically, Louisi
ana is located in the heart of the rapid
ly growing Sunbelt, which means prod
ucts manufactured in Louisiana can be
distributed quickly and economically
to an emerging lucrative southern
market.
One of the largest known contribu
tors to the state’s economic develop
ment in 1977 will be the construction
of the Louisiana Superport. LOOP has
recently received federal approval to
begin construction of a $900-million-

plus project scheduled for completion
in 1980. An estimated 16,250 jobs are
expected to be created directly and in
directly by the Superport in 1977
alone.
Additionally, the Superport is ex
pected to spur an estimated $4.5 bil
lion of new investment in refineries,
petrochemical plants and related indus
tries by the time the project is com
pleted.
Another significant factor in the
state’s economic development will be
reorganization of the Office of Com
merce and Industry under the Depart
ment of Commerce. The reorganization
will provide stronger and more attract
ive programs to a wide range of in
dustries.
The main thrust for the Department
of Commerce will come from the Office
of Commerce and Industry. Added
support will be provided by the Offices
of Financial Institutions and Insurance
Rating and a number of regulatory
agencies that also are a part of the De
partment of Commerce.
The Office of Financial Institutions
will provide input through its regula
tions of state banking associations, sav
ings banks, trust companies and home
stead and building and loan associa
tions; administration of the Louisiana
Savings & Loan Association Law, the
Louisiana Consumer Credit Law and
the Securities Commission.
The Department of Commerce will
act as a catalyst between the state’s
economic developers, economic devel
opment districts and communities in
their relationship with the industrial
trade and commercial investors.
Plans are being formulated to set
realistic and attainable objectives in the
area of jobs and investment. W e ex
pect 1977 to be a year of aggressive,
productive economic promotion and in
ducement. * *

WRITTEN
LOAN
POLICY
Every Bank Should
Have One!

"The Bank Board
And Loan Policy"
Provides the Information
Needed to Formulate
a Written Loan Policy
or Update an Existing One!
A must for banks, this 40-page manual
tells why all banks should have written
loan policies and how they can formu
late or update such policies to serve as
guides for lending officers and to help
protect the bank from making costly
commitments.
The manual presents the loan policies
of four well-managed banks and con
tains a rating formula for secured and
unsecured loans, conditional sales con
tracts, all mortgages, government and
municipal bonds and government agency
securities.
Topics spotlighted include:

• Conditional Sales Contracts
• A ll Mortgages
• Loans fo r Education
Also included are sections on who
should have lending authority, lending
procedures, loan limits, credit depart
ment responsibilities and loan examiner
responsibilities.
Can your bank afford to be without
this manual?
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The BANK BOARD Letter
408 O live St., Suite 505
St. Louis, MO 63102

MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

New Hyatt Regency Hotel
Site of LBA Convention

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Federal Reserve Bank of St. Louis

«®

SHINY new look awaited Louisiana bankers and their
spouses attending the 1977 Louisiana Bankers Associa
tion convention in New Orleans last month.
The convention moved to the brand new Hyatt Regency
Hotel, located adjacent to the Superdome. From April 1-4,
delegates roamed the halls of the largest hotel in the Hyatt
chain, the first high rise building in Poydras Plaza.
Highlights of the 1,250-room hotel include a pedestrian
concourse 60 feet wide extending through the hotel build
ing and leading to the Superdome. The concourse contains
numerous retail shops and boutiques. Typical of most Hyatt
hotels is the huge atrium, which extends 260 feet upward
from the third floor level and contains nearly five million
cubic feet of space. The atrium is described as a giant gar
den complete with plants, trees, cascading ivy and wallhugging glass elevators that disappear through the ceiling on
their way to the hotel’s revolving rooftop restaurant complex.
The base of the 24-story atrium contains a cocktail lounge,
an informal dining area, an entertainment lounge and a
restaurant. It also gives entrance to the grand ballroom and
exhibit hall.
The hotel’s ballroom seats 2,500 persons for banquets
and can be divided into eight smaller rooms for meetings.
Fifteen additional meeting and banquet rooms are located
one floor above the ballroom level.
The hotel includes 100 suites, of which 44 are equipped
for conferences and 4 6 with wet bars.
The exhibit hall contains more than 26,000 square feet of
space. An adjacent structure holds 350 cars and has a
swimming pool on its roof, plus a number of lanai-type
rooms.
Another unusual feature of the hotel’s atrium are space
frame windows that form the north and south walls of the
building. Each of the space frames is 50 feet wide and 200
feet tall. Each pane of glass is seven feét square, and is
mounted diagonally. The windows offer panoramic views
of the city to guests riding the glass elevators.
Services at the hotel include computerized registration
and check-out, reservations for local events, transportation,
medical and secretarial service, salons for personal shopping,
beverages, barbers and hairdressers, food and drink, recre
ation, entertainment, photography, catering, shoe repairs,
pet boarding, newsstand, drugstore and valet service.
A corps of women offer concierge (caretaker) service to
guests. The young women are known as “problem solvers”
and take pride in personally greeting every arrival at the
hotel. * *

TOP: View of Hyatt Regency, New Orleans, from Superdome. Center
panel is glass frame window 200 feet high, which forms side of 24story atrium. Atop building is revolving restaurant. LEFT: Glass ele
vators climb sides of atrium inside hotel. Atrium contains lounges,
restaurants.

MID-CONTINENT BANKER for May 1, 1977

Our portrait
produces
new customers
“Any banker in the country
loves to see prospects walk in
the d o o r— well th at’s what the
Olan Mills portrait program did
for us. We are very pleased.”
Tom Maxwell
President
Bank of Cannon County
Woodburry, Tenn.
S o m e m arketing e xp erts
claim it can ’t be done — that
is, for the prospect to co m e to
you rather than you going after
him.
Well we can show you howto
get them to com e in the door
by th e d roves. O ur bank
marketing program of giving
away F ree p ortraits (in
beautiful color) to cu stom ers
and p rospects has proved to
be one of the m o st successful
program s yet.
Here’s how it works. Olan
Mills representatives will work
out a schedule for your bank to
give away beautiful color
portraits to c u s to m e rs and
prosp ects. They will help you
plan, organize and advertise

the program. They will take the
pictures and send a follow-up
team to show proofs.
And the beauty of it all — it
doesn ’t c o s t the cu stom er a
dime. Your only obligation is a
nominal charge for advertising
materials.
Call us today. We’ll send a
representative to see you.

Additional information on
The Olan Mills Family Portrait
Plan is available from Olan
Mills Bank Marketing Division,
c /o J o e Trivett, 1 1 0 1 Carter
S tre e t, C h attan o o g a,
Tennessee 3 7 4 0 2 . Telephone
(615)622-5141.

Bank Marketing Division

MID-CONTINENT BANKER for May 1, 1 9 7 7

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Federal Reserve Bank of St. Louis

JOHNSON

McLEOD

COLEMAN

SUTTLE

RESSEGUIE

KIEFFER

JASPER

MATHIAS

C o n v e n t i o n 'F i r s t - T i m e r s '
These new faces will be rep
resenting

city-correspondent

banks at state conventions this
year.

Alabama Convention
• H. E . Johnson Jr. is senior vice
president and head of the correspon
dent department at Third National,
Nashville. He joined the bank in 1950
and was named senior vice president
earlier this year.
• Purser L. McLeod Jr. is an as
sistant cashier at First National, Bir
mingham. He joined the bank in 1972
and is an assistant branch manager.
• William E . Coleman is an assistant
vice president in the Main Office of
First National, Birmingham. He joined
the bank in 1968 after receiving an
MA from the University of Alabama.
• W. Gary Suttle is senior vice pres
ident, Alabama Bancorp., Birmingham.
He joined the HC in 1976, following
service with Vulcan Materials Co.,
Birmingham, as director of planning
and development.

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Federal Reserve Bank of St. Louis

ROY

AMBI Convention
• Roger W . Kieffer is an assistant
vice president at Harris Trust, Chicago.
He joined the bank in 1970 and is in
the banking department’s division F.
• Richard W. Resseguie is a senior
vice president in the banking depart
ment at Northern Trust, Chicago. He
joined the bank in 1956 and is in
charge of the national group.
• Daniel W . Jasper is an assistant
vice president at Mercantile Trust, St.
Louis. He has been with the bank since
1969 and heads division A of the cen
tral group.
• Robert J. Mathias is a banking of
ficer in division A of the Central group
at Mercantile Trust, St. Louis. He
joined the bank in 1974 as an analyst
in the operations improvement pro
gram.

Missouri Convention
• Steven McD. Campbell is a com
mercial banking officer in the regional
banking department at First National,
St. Louis. He joined the bank last year
following service with the State Depart
ment in Washington.
• Steven J. Roy is a commercial
banking officer in the regional banking
department at First National, St. Louis.

STRAIGHT

BROWN

He joined the bank in 1972 in the ED P
department.
• Phillip D. Straight is an assistant
vice president in division II of the busi
ness development department at United
Missouri Bank, Kansas City. He joined
the bank in 1973.
• Thomas J. Brown is a vice presi
dent at Commerce Bank, Kansas City.
He is manager, Missouri correspondent
division, and is a former vice president,
Commerce Bancshares. He joined the
bank last September.

Texas Convention
• Emily A. Schroeder is an official
assistant at Citibank, New York City,
and travels in New Mexico, Dallas and
East/West Texas with backup respon
sibility in Oklahoma.
• John V. N. McClure is a commer
cial banking officer in the banking de
partment at Northern Trust, Chicago.
He joined the bank in 1973 and serves
in the southwestern division.
• Michael T. Fleming is vice presi
dent in charge of national and metro
politan corporate accounts in the busi
ness development department of United
Missouri Bank, Kansas City. He joined
the bank in 1970.
• Robert J. Waller is with the cor
respondent department of First Na-

SCHROEDER

McCLURE

FLEMING|

MID-CONTINENT BANKER for May 1, 1977

WALLER

ANDERSON

DIERKS

tional, Oklahoma City. He joined the
bank in 1976 following service with
Republic National, Dallas.
• Thiers Y. Anderson is an assistant
vice president at First National, St.
Louis, which he joined last September,
following service with a trust company
in Maine.
• David A. Dierks is a vice presi
dent at First National, St. Louis. He
joined the bank in 1969 as a trainee
and transferred to the regional banking
division in 1971.
• Kenneth S. Franklin Jr. is a com
mercial banking officer at First Na
tional, St. Louis. He has been with the
bank since 1971 and has held his pres
ent title since 1973.

Oklahoma Convention
• Clyde V. Crutchmer is a represen
tative in the correspondent banking de
partment at Fourth National, Tulsa. He
is a former starting quarterback for the
University of Colorado football team.
• Thiers Y. Anderson joined First
National, St. Louis, last September. He
is an assistant vice president.
• David A. Dierks joined First Na
tional, St. Louis, in 1969 as a trainee
and transferred to the regional banking
division in 1971, where he is a vice
president.
• John V. N. McClure joined North
ern Trust, Chicago, in 1973. He serves
as a commercial banking officer in the
southwestern division of the banking
department.

LEWIS

WOLIN

CRUTCHMER

• Denzil E . Oswalt is an assistant
vice president in the regional banking
department at First National, Tulsa. He
joined the bank in 1971 and is a for
mer director of marketing for the bank
and First Tulsa Bancorp.
• Jerry W . Hopkins is an assistant
vice president at First National, Tulsa.
He is a former director of a field office
with Houston Bank for Cooperatives
and is new with First of Tulsa.
• Marc B. Wolin joined First Na
tional, Tulsa, recently after serving as
a senior assistant bank examiner for
the FD IC . He has attended the OB A
Commercial Intermediate School of
Banking.
• Donald E . Lewis is an account
officer at Citibank. New York City. He
has been with the bank for three years,
with previous experience in the risk
asset review area of the comptroller’s
division.
• Charles Q. (Charlie) Chandler IV
is a management trainee appointed to
special projects at First National,
Wichita. He became a full-timer at the
bank last August and his family has
been associated with the bank for four
generations.

Kansas Convention
• Denzil E . Oswalt joined First Na
tional, Tulsa, in 1971. He is now an
assistant vice president in the regional
banking department.

CHANDLER

MID-CONTINENT BANKER for May 1, 1 9 7 7

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Federal Reserve Bank of St. Louis

FRANKLIN

BRIXEY

OSWALT

HOPKINS

• Jerry W. Hopkins recently joined
First National, Tulsa, where he serves
as an assistant vice president. He was
formerly with Houston Bank for Co
operatives.
• Marc B. Wolin recently joined
First National, Tulsa, after three years
of service with the FD IC , where he
was a senior assistant bank examiner.
• D. Michael Brixey is an assistant
vice president in the correspondent di
vision at Commerce Bank, Kansas City,
which he joined recently. He travels in
southern Kansas.
• H. C. Bauman has been a vice
president in the correspondent division
of Commerce Bank, Kansas City, since
last November. He is manager of the
Kansas correspondent division and has
been with the bank since 1975.
• Stephan P. Blackburn is an as
sistant vice president in division II of
the business development department
at United Missouri Bank, Kansas City.
He joined the bank in 1973.
• Gregory R. Wartman is an as
sistant cashier in the correspondent di
vision at First National, Kansas City.
He joined the bank in 1975 after earn
ing an MBA from the University of
Kansas.
• Charles Q. (Charlie) Chandler IV
is a management trainee appointed to
special projects at First National,
Wichita. He became a full-timer at the
bank last August and his family has
been associated with the bank for four
generations.

BAUMAN

BLACKBURN

WARTMAN

Space Center to Host Ala. Bankers
As Association Returns to Huntsville
U TER SPACE will hold center stage
for at least a portion of the 84th
annual convention of the Alabama
Bankers Association, which convenes in
Huntsville May 4-6.
The social function on the first night
of the convention—a cocktail party—
will be held at the Alabama Space and
Rocket Center Museum, repository for
equipment used in many of the probes
into space made by the U. S.
The cocktail party will be hosted by
the following banks and HCs: American
National, Mobile; Bank of the South
east, Birmingham; Birmingham Trust
National; Central Bancshares of the
South; First Alabama Bancshares; First
Bancgroup—Alabama; First National,
Birmingham; First National, Dothan;
Southern National, Birmingham, South
land Bancorp.; and Union Bank, Mont
gomery.
The cocktail hour will be followed by
an international dinner and entertain
ment in the exhibition hall at the Von
Braun Civic Center, headquarters for
the convention.
The first general business session will
begin at the Civic Center at 9 :3 0 a.m.,
Thursday, May 5. Presiding will be
Robert H. Woodrow Jr., vice chairman,
Alabama Bancorp., Birmingham. On the
program are talks by Walt Weisman,
com m unications e x p e r t; P r e s id e n t
Woodrow’s address; and a talk about
associations in changing times by Hugh
McCahey of the U. S. Chamber of
Commerce, Washington, D. C. As part
of the session, Ernest F. Ladd Jr., ABA
state vice president, and chairman,
Southland Bancorp., Mobile, will con
duct a meeting of members of the ABA
to elect a member of the ABA Govern
ing Council to succeed Mr. Ladd, who
has held the office for the past two
years.
A concurrent program for women will
include a tour of a historic residential
district and a luncheon.

The social event for Thursday eve
ning includes cocktails and a sit-down
dinner at the Civic Center, followed by
the “Boots” Randolph Show and danc
ing.
The second general business session
will convene at 9 :3 0 a.m. on Friday,
May 6. Scheduled is a talk by Congress
man Richard Kelly from Florida, a
member of the House Committee on
Banking and Currency. He plans to
have some straight talk for bankers in
their participation in political activities.
Also on the program is a panel on credit
unions, moderated by John D. Chis
holm of Rochester, Minn. Panelists will
include Arthur Tonsmeire Jr., past presi
dent, U. S. Savings & Loan League, and
president, First Southern Savings, Mo
bile; and Marvin L. Fisher Jr., vice
president, Tioga State, Spencer, N. Y.,
the bank which was joined by the ABA
in a suit against share drafts.
The concluding activity of the con
vention will be the traditional luncheon
and election of officers, to be held at the
Hilton Hotel at 12:30.
Current Ala.BA officers serving with
Mr. Woodrow are Charles S. Snell,
president, Citizens National, Shawmut
—first vice president; and William H.
Mitchell, president, First National,
Florence— second vice president.
At the time Mr. Woodrow was in
stalled as Ala.BA president, he was
chairman and CEO, First National,
Birmingham. He has since become vice
chairman of First National’s parent HC,
Alabama Bancorp. He remains as a bank
director and trust committee chairman,
but devotes full time to his HC duties.
He joined First of Birmingham in 1947
in the trust department and was named
assistant trust officer and corporate trust
head three years later. He was elected
chairman of the bank and CEO in 1972.
Mr. Snell is a graduate of Auburn
University and served in the Alabama
public school system for 11 years prior

WOODROW

SNELL

MITCHELL

MORGAN

to joining his bank. He has served two
terms as a member of the Alabama
House of Representatives.
Mr. Mitchell has been president and
CEO of First of Florence since 1958
and a director since 1954. Prior to join
ing the bank, he was a partner in a
law firm. He attended Davidson College
and the University of Alabama and is
a director of the Alabama State Cham
ber of Commerce.
Convention chairman is W. Eugene
Morgan, chairman and CEO, First Ala
bama Bank, Huntsville. Committee
chairmen include Mrs. Joe M. Hinds Jr.,
First Alabama Bank—women’s enter
tainment; Richard E. Oliver, president,
American National— arrangement and
entertainment; Mario R. Bottesini, presi
dent, Bank of Huntsville—hotels; C. C.
Richardson, president, Peoples National
—sports; W. R. (Bill) Collins, presi
dent, Central Bank of Alabama—regis
tration; and Robert J. Blackwell, presi
dent, Henderson National—transporta
tion. • •

Ala.BA convention site is Von Braun Civic Center, $15-million sports-entertainment-exhibit complex in Huntsville.

mÊÊÊÊÊÊKBÊÊÊimÊÊÊÊÊmÊSÊBÊÊÊmÊaamÊÊKmmÊÊnÊammm

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Federal Reserve Bank of St. Louis

WÊÊËÊËÈM

This advertisement is neither an offer to sell nor a solicitation of offers to buy any of these securities.
The offering is made only by the Prospectus.
N EW ISSUE

March 25,1977

$350,000,000

CITICORP
8.45% Notes Due March 15, 2007

P r ic e 9 9 . 6 7
plus accrued interest from March IS, 1977

Copies of the Prospectus may be obtained from any of the several underwriters,
including the undersigned, only in States in which such underwriters are qualified
to act as dealers in securities and in which the Prospectus may legally be distributed.

The First Boston Corporation

Goldman, Sachs & Co.

Merrill Lynch, Pierce, Fenner & Smith
Incorporated

Salomon Brothers

Morgan Stanley & Co.
Incorporated

Blyth Eastman Dillon & Co.

Bache Halsey Stuart Inc.

Dillon, Read & Co. Inc.

Incorporated

Donaldson, Lufkin & Jenrette

Drexel Burnham & Co.

Hornblower & Weeks-Hemphill, Noyes

Securities Corporation

Incorporated

E. F. Hutton & Company Inc.
Kuhn Loeb & Co.

Keefe, Bruyette & Woods, Inc.

Lazard Frères & Co.

Lehman Brothers

Incorporated

Paine, Webber, Jackson & Curtis

Kidder, Peabody & Co.
Incorporated

Loeb Rhoades & Co. Inc.

Incorporated

Reynolds Securities Inc.

M. A. Schapiro & Co., Inc.

Incorporated

Smith Barney, Harris Upham & Co.

Warburg Paribas Becker Inc.

Wertheim & Co., Inc.

Incorporated

White, Weld & Co.

Dean W itter & Co.

Incorporated

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MID-CONTINENT BANKER fo r May 1, 1977

A M B I C o n v e n t io n
(A sso c ia tio n f o r IVIO d e
in Illinois)

r n

B an k in g

President

Chicago, May 4-6
Headquarters—Continental Plaza Hotel

PROGRAM
FIRST SESSION, May 5
SINCLAIR
AMBI Pres. Gerald Sinclair is e.v.p., Salem Nat'l, and
is a past pres., Tri-County Bankers Federation.

Vice President

2nd Vice Pres.

Welcome— GERALD SINCLAIR, AMRI president, and ex
ecutive vice president, Salem National.
Address—“The Current Challenge in Bank Profitability”—
JOHN GLEASON, senior vice president, Northern Trust,
Chicago.
Address—“The Comptroller of the Currency’s Consumer
Compliance Examination—What You Need to Know”—
JOHN CHIPOURAS, deputy director, consumer affairs di
vision, Comptroller of the Currency, Washington, D. C.

LUNCHEON SESSION
Address—“Where Do W e Stand in Washington?”— GERALD
M. LO W R IE, executive director, government relations,
American Bankers Association, Washington, D. C.

SECOND SESSION, May 5
HUMPHREY

SMITH

Robert C. Humphrey, AMBI v.p., is pres., State National,
Evanston, and serves in a number of capacities with a va
riety of other organizations. 2nd V.P. Loren M. Smith is
pres. & CEO, United Bank of III., Rockford, which he
joined in 1969. He w as formerly with State Bank,
Kirkland.

Address—“Striving for Management Excellence—Perform
ance Appraisal for Your Management Team”—DAVID E.
MAGUIRE, vice president, Continental Illinois National,
Chicago.
Address—“Trends in Officer Compensation”—JOHN E.
BALKCOM, consultant for executive compensation, Hew
itt Associates, Deerfield, 111.

THIRD SESSION, May 6
Treasurer

Chairman

Address—“Electronic Banking—Where Do W e Go From
Here?”—JAM ES E. SM ITH, executive vice president, First
Chicago Corp.
Panel—“How to Be Effective with Your Legislator”—P R E
SCOTT BLOOM and P H ILLIP ROCK, state senators; and
M ICHAEL BRADY and RICHARD L U F T , state repre
sentatives.
Annual Business Meeting and Legislative Update.

BONUS EVENT, May 6

BUNN

KASSING

AMBI Treas. Willard Bunn Jr. is ch. & CEO, Springfield Marine Bank, which he joined in 1935. He is
ch., Council for Branch Banking in III. Lester A. Kassing
is AMBI ch., and pres. & CEO, Jefferson Trust, Peoria.
He entered banking in 1958 with Indiana Bank, Ft.
Wayne.

MID-CONTINENT BAN KER fo r May 1, 1977

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Federal Reserve Bank of St. Louis

Address—“W hat You Need to Do to Become a High-Perform
ance Bank”—A LEX SH ESH UN OFF, president, Sheshunoff & Co., Austin, Tex.

AMBI Convention Theme:
Improving Bank Services;
Meeting Set for Chicago
CHICAGO—The fourth annual con
vention of the Association for Modern
Banking in Illinois will have as its
theme “Improving the Quality of Bank

Services in Illinois.” The convention
will be held at the Continental Plaza
Hotel in Chicago May 4-6.
The convention will open with a re
ception on Wednesday, May 4, spon
sored by the Chicago members of
AMBI. It will be held in the governor’s
suite of the Continental Plaza from
6:3 0 to 8:30.

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We salute the job AMBI has done since Its
Inception in 1973. It has made great strides.
May this fourth annual convention bring the
goals closer to attainment.

Union
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200 Collinsville Avenue
East St. Louis, Illinois
(618) 271-1000 398-4800

M EM B ER F.D .I.C.
80

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Federal Reserve Bank of St. Louis

Member
FDIC

On Thursday, May 5, the first formal
session of the convention will feature a
presentation by John Gleason, senior
vice president, Northern Trust, Chi
cago, entitled “The Current Challenge
in Bank Profitability.”
Capping out the morning portion of
the program will be John Chipouras,
deputy director for the consumer af
fairs division of the office of the Comp
troller of the Currency. Mr. Chipouras
will speak about the Comptroller’s con
sumer compliance examination.
“Where Do We Stand in Washing
ton?” is the title of the luncheon ad
dress to be delivered by Gerald M.
Lowrie, executive director, ABA gov
ernment relations. Scheduled for the
afternoon session is David E. Maguire,
vice president for corporate personnel
service, Continental Illinois National,
Chicago, speaking on “Striving for
Management Excellence— Performance
Appraisal for Your Management Team.”
Concluding the formal afternoon
program will be John E. Balkcom, con
sultant for executive compensation,
Hewitt Associates. His topic will be
“Trends in Officer Compensation.”
The session set for Friday, May 6,
will begin with “Electronic Banking,
Where Do W e Go From Here?” by
James E. Smith, executive vice presi
dent, First Chicago Corp. and former
Comptroller of the Currency. Next up
will be a panel on “How to Be E f
fective With Your Legislator” with
members of the Illinois general as
sembly offering their opinions.
Rounding out the Friday morning
agenda will be the AMBI annual busi
ness meeting and legislative update.
The afternoon will feature a bonus
event entitled “What You Need to Do
to Become a High-Performance Bank”
by Alex Sheshunoff, president, Sheshunoff & Co., Austin, Tex. Mr. Shesh
unoff will give each conference par
ticipant a statistical summary of each
participating bank’s performance, based
on FD IC call figures. Individual an
alysis will be available at the conclusion
of the session.
The annual banquet will be held
Thursday evening and will feature a
gourmet dinner followed by entertain
ment by the Life singing group.

■ RICHARD J. ACKERMANN, vice
president, Continental Bank, Chicago,
has been elected president, Association
of Primary Dealers in Government Se
curities. The association is made up of
the 34 firms recognized by the New
York Fed as primary dealers in U. S.
Treasury and government agency se
curities. Mr. Ackermann joined Conti
nental in 1959.
MID-CONTINENT BANKER fo r May 1, 1977

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banking serv ices, we’re
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can help you serve your custom ers more productively.
You know what your correspondent
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bank provides.
Check this list of First Chicago's com
prehensive services. See if there aren't
many ways we can work together more
productively.
Then call a correspondent banker at
First Chicago, (312) 732-4101, or write us.
DATA PROCESSING

Point-of-Sale Techniques
Bank Accounting Services
Bank Information Systems
Electronic Funds Transfers
CREDIT FACILITIES

Holding Company Lines of Credit
Participations: Upstream and Downstream
Intermediate Term Credit
Liquidity Lines of Credit
Commercial Finance Services: Inventory and
Receivable Financing
Corporate Financing Advisory Services
Leasing Activities and Analysis
Credit Information
Small Business Administration:
Loan Counsel
MANAGEMENT ASSISTANCE

Loan Portfolio Review Techniques
Economic Forecasting
Profit Planning and Forecasting
Marketing and Business Development Advice
Personnel Assistance
Operations Planning
Organization Planning

FOCUS: Lockbox Location Model
Visual Aids: Slides and Closed Circuit
TV Production
TRUST BANKING

Personal and Corporate Trust Services
Trust Investment Advisory Services
Monthly Investment Services
Stock Transfer and Shareholders Services
Dividend Reinvestment
PERSONAL BANKING ASSISTANCE

Bank Promotions
YES Card'“
BankAmericard®
Savings Programs
Automobile Leasing Program
Bank-At-Work/Direct Deposit Program
OPERATIONAL SERVICES

Cash Letter Clearings: End-Point &
Float Analyses
Coin and Currency
Collections
Money Transfer
Federal Reserve On-Line Settlement
Securities Custody
Security and Coupon Collection
Payroll Accounting
Student Loan Servicing
INVESTMENTS

Government Securities
Municipals
Federal Agency Securities
Federal Funds
Repurchase Agreements
Commercial Paper
Certificates of Deposit
Treasury Tax and Loan Accounts
Money Desk Reviews
Portfolio Analysis Services

SPECIAL CORRESPONDENT SERVICES

INTERNATIONAL BANKING

Annual Correspondent Conference
Account Referrals
Mini-conferences and Workshops,
Special Events Planning
Record Retention and Reconstruction
Cash Management Consulting: Collection,
Concentration, Disbursement and Control

Worldwide Locations
Merchant Banking
Money Market Instruments
Letters of Credit
Foreign Exchange Transactions
Transfers and Remittances
Ex-Im Financing

MEMBER FDIC

MID-CONTINENT BANKER fo r May 1, 1977

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Federal Reserve Bank of St. Louis

Central
to your needs

C entral Trust B ank

C entral M o to r B ank

Central Trust is constantly in tune with the growth of Central Missouri and stands
ready to serve all your correspondent needs with the best in modern banking.
We look forward to seeing you at the MBA convention in Kansas City, May 8-10.

F re d Rost, S enior Vice P resid en t
John M orris, S enior Vice P resid en t • Jim H e rfu rth , Senior Vice P resident
You have a friend at

THE CENTRALTRUST BANK
JEFFERSON CITY, MISSOURI 65101

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Federal Reserve Bank of St. Louis

Member Federal Deposit Insurance Corporation.
MID-CONTINENT BANKER fo r May 1, 1977

M is s o u r i C o n v e n t io n
President

Kansas City, May 8-10
Headquarters—Crown Center Hotel

PROGRAM
RICHMOND

FIRST SESSION, 2 p.m., May 9

Charles K. Richmond, MBA pres., is v. ch.,
American Nat'l, St. Joseph. He joined the
bank in 1946 and w as elected an officer in
1949. Prior to being named v. ch. last year, he
w as e.v.p.

Call to Order—DON V. THOMASON, convention chairman, and ex
ecutive vice president, United Missouri Bank, Kansas City.
Welcome— CHARLES B. W H E E L E R , mayor, Kansas City.
Remarks— CHARLES K. RICHMOND, MBA president, and vicechairman, American National Bank, St. Joseph.

Vice President

Reports.
Introduction of Regional Vice Presidents, Secretaries and Chairmen of
Standing and Special Committees.
Report of Committee on Nominations and Election of Officers.
Workshops and Round Table Discussions.
Adjournment.

SECOND SESSION, 9:30 a.m., May 10
ANDERSON
Mills H. Anderson is MBA v.p. He is pres. &
CEO, Bank of Carthage, which he joined
in 1946. He has been pres, since 1959. He has
chaired the governmental affairs and consumer
finance committees for MBA.

Treasurer

Call to Order— CHARLES K. RICHMOND.
Meeting of Missouri Members of the American Bankers Association—
A. R. NAUNHEIM, ABA state vice president, and president, Char
ter Bank of Overland.
Election of Member of Governing Council and Member and Alter
nate Member of Nominating Committee to Serve at 1977 ABA
Convention.
Address— RON NESSEN , press secretary to President Gerald R. Ford
and former NBC News Washington correspondent.
Announcement and Adjournment.

THIRD SESSION, 2 p.m., May 10
Address—JACK W . CARLSON, vice president, chief economist, U. S.
Chamber of Commerce, Washington, D. C.
Unfinished Business.
New Business.
Installation of Officers.
LEA

Adjournment.

Treas. of the MBA is Pat Lea, ch. & pres., First
Nat'l, Sikeston. He has been in banking since
1953 and has served MBA in the Junior
Bankers Section and on various committees. He
is a former pres, of Southeast Missouri
Bankers Institute.

MID-CONTINENT BANKER fo r May 1, 1977

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Federal Reserve Bank of St. Louis

Alexander, Nessen
Head Speaker List
At MBA Convention
KANSAS CITY—ABA Executive Vice
President Willis Alexander and President
Gerald R. Ford’s press secretary, Ron
Nessen, are slated to head the speaker’s
list at the Missouri
Rankers Association
convention to be
held May 8-10 at
the Crown Center
Hotel here.
Mr. Alexander is
a former
MBA
p r e s i d e n t (1960)
and is chairman,
Trenton Trust. He
was ABA president
ALEXANDER
in 1968.
The following schedule of events is
planned for the three-day meeting:
Sunday, M ay 8— Registration in the
Century Lounge, Crown Center Hotel,
from 2 to 6 p.m. and commercial ex
hibits in the Roanoke Foyer, Shawnee
Mission and Liberty rooms during the
same hours.
M onday, M ay 9—Golf tournament at
Brookridge Country Club, beginning at
7 :3 0 a.m. There will also be a tennis

tournament at the Woodside Racquet
Club.
Registration and exhibits will open
at 9 a.m. and the sergeants at arms
meeting will be held at 11 a.m. in the
Independence Room. The 50-Year Club
will meet at 11:30 a.m. for a reception
and luncheon in the Roanoke Room.
An activity for the women will in
clude a Designers Showhouse tour and
luncheon.
The first general business session will
begin at 2 p.m. in Centennial A and
will include a welcome, officer reports,
election of officers and a workshop/
round table discussion.
Round table discussion topics will in
clude proposed federal legislation and
regulation affecting commercial banks
and their competitors, Regulation B,
account profitability and costing of ser
vices for small- and medium-size banks
and NOW accounts.
A mixer and dance at 9 p.m. will cap
the day’s activities.
Tuesday, May 10—The second busi
ness session will begin at 9 a.m. and
will include the annual meeting of Mis
souri members of the ABA, conducted
by A. R. Naunheim, ABA state vice
president, and president, Charter Bank
of Overland.
Two addresses will follow, the first
by Jack W. Carlson, vice president and

chief economist for the U. S. Chamber
of Commerce in Washington, D. C.,
and the second by Mr. Nessen.
A luncheon will be held at noon that
will feature William C. Phelps, lieu
tenant governor of Missouri.
The final business session will begin
at 2 p.m. and will feature Mr. Alex
ander, whose talk is entitled “Another
Point of View.”
A cocktail party will begin at 6 p.m.,
followed by the traditional president’s
banquet at 7. Entertainment will be on
the program.

Thomason, Betz Plan Convention
As Chairman, Vice Chairman
This year’s Missouri Bankers Conven
tion is chaired by Don V. Thomason,
senior vice president, United Missouri
Bank, Kansas City. Vice chairman is

THOMASON

BETZ

Greetings to Our Banker Friends
at This Convention Season
FROM THE OFFICERS AND DIRECTORS
OF THE SOUTH SIDE NATIONAL BANK
O ffic e r s
G EO R G E J. HELEIN
President
J. RICHARD FURRER
Executive Vice President
H. WM. ROBERT
Vice President & Trust Officer
G EO R G E F. BENNER
Vice President
WALTER C . HAMMERMEISTER
Vice President & Cashier
ALBIN F. O EHLER
Vice President

RAYMOND E. KNORPP
Vice President
WALTER E. GO EBEL
Assistant Vice President
ROBERT C . WERKMEISTER
Assistant Vice President
LEON A. BREUNIG
Assistant Vice President
W ILLIAM E. MUHLKE
V.P. & Auditor
C A R O L S. ALEXANDER
Asst. V.P. & Sec'y to the Board

Walter E. Collins
Ralph Crancer, Jr.
Howard F. Etling

C . J. Furrer, Jr.
J. Richard Furrer
Thomas J. Hejlek
George J. Helein

ARTHUR L. JEANNET, JR.
Assistant Cashier
VERNON C . BETSCHART
Assistant Cashier
MARGUERITE CIBULKA
Safe Deposit Officer
A LY C E L. SCOTT
Asst. V.P.
JOSEPH E. M AGER
Personal Loan Officer
G EO R G IA KING
Pers. Loan Officer

D ir e c t o r s
Paul V. Helein
Charles F. Herwig
Edward C . Schneider
Edward Zeisler

RESOURCES OVER $98,000,000

South Side National Bank in St. Louis
GRAND AND GRAVOIS
ST. LOUIS, MISSOURI
Member Federal Deposit Insurance Corporation

J
84

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER fo r May 1, 1977

St. Louis County National Bank in
Clayton is the largest bank in
the County . . . 4th largest in all of
St. Louis.

services. But County National

This is the lead bank in County
National Bancorporation . . . a group
of four banks now looking to the
future with an eye on further
expansion.

matters. Security, reliability,

Today, many banks place their
emphasis on promotional type

always been. The kind of a bank we’ll
always be.

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Federal Reserve Bank of St. Louis

believes that thoughtful professional

The Thoughtful Banking Bank
— in Clayton.

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integrity. Those three words guide
our people and our policies.
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ST L O U IS

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Affiliates of First Midwest Bancorp

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Federal Reserve Bank of St. Louis

MEMBER F.D.I.C.

Charles S. Betz, vice president, First
National, St. Louis.
Serving as committee members are
Fred N. Coulson Jr., senior vice presi
dent, Commerce Bank, Kansas City;
George C. Dudley, senior vice presi
dent, First National, Kansas City; John
H. Obermann, president, MercantileCommerce Trust, St. Louis; Thomas L.
Palmer, vice president, Traders Na
tional, Kansas City; Robert V. Plummer,
vice president, Columbia Union Na
tional, Kansas City; and Melvin E.
Schroeder, vice president, Mercantile
Bank, Kansas City.

Crawford To Be First Timer
As New MBA Exec. V.P.
Robert W. Crawford, new executive
vice president of the Missouri Bankers
Association, will at
tend his first MBA
c o n v e n t i o n this
year when the as
sociation holds its
annual meeting at
Crown Center Ho
tel May 8-10.
Mr. Crawford as
sumed his duties
last February 1,
s u c c e e d i n g Felix
LeGrand, who had
served the association for a number of
years and who now is associated with
the MBA’s Voluntary Employees Ben
eficiary Association as administrator.
Mr. Crawford had been president
since 1973 of the Association of Gen
eral Merchandise Chains, Inc., Wash
ington, D. C., after starting as executive
vice president in 1971.
A native of Nevada, Mo., Mr. Craw
ford represented Vernon County as a
member of the Missouri House of Rep
resentatives from 1954-60, serving as
chairman of the S&L committee and the
interim committee on local government.
In 1959 he was named administrative
assistant to Governor James T. Blair Jr.
and in 1960 was appointed Missouri
Secretary of State to fill the unexpired
term of the late Walter H. Toberman.
From 1961 to 1971, he served as
president of the Missouri Retailers As
sociation. During his tenure he super
vised the merger of that association and
the Missouri Retailers Council, to ex
tend the association to 2,500 firms.
Mr. Crawford is a graduate of the
University of Missouri and a veteran of
the Korean War. He was twice cited for
meritorious service and was discharged
in 1953 as a first lieutenant. He is mar
ried and the father of two children.

MID-CONTINENT BANKER fo r May 1, 1977

W hile you're at
the convention.
Fred N. Coulson, Jr.

James M. Kemper, Jr.

Thomas J. Brown

John C. Messina

George W. Porter

Put us on your
m eeting list.
Look for these six men from Com m erce Bank at this year's
convention. They help keep banks of all sizes up-to-date on
investm ents, new methods and systems, regulations, trends and
everything involved in the changing pace of banking today.
Join them at the Missouri Bankers Convention on May 8-10.
l i i l

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Federal Reserve Bank of St. Louis

Member FDIC

S. K. 'Ken' Turner Is Nominee
For Missouri Bankers' Treasurer

Convention Greetings to the
MISSOURI BANKERS ASSOCIATION

The nominee for MBA treasurer this
year is S. K. “Ken” Turner, president,
First National, Kirksville.
Mr. Turner entered banking in 1947
at Citizens Bank, Shelbyville, as a
bookkeeper and was promoted to assist
ant cashier in 1950. In 1952, he became
cashier, Farmers Bank, Emden. In 1959,
Mr. Turner joined Laddonia State as
cashier, but left in 1961 to go to Stur
geon State as executive vice president.

We’re a community
bank . . . and proud
of the reliable service
we’ve provided since
1926. When you’re
in town, stop by to
see us.
Above: Our “new building” in 1929 cost $30,000 . . . was lauded as one
o f the most beautiful in St. Louis County. Our current main bank building
sits on the same foundation . . . still a hometown bank.

...bigger to
serve you better
B AN K & T R U S T CO.
8 9 2 4 St. Charles Road
St. Johns, Mo. 63114

In 1962, he was elected cashier, Mis
souri Bank, Kansas City. In 1967, he
became executive vice president of First
of Kirksville (formerly National Bank
of Kirksville) and advanced to president
in 1975. He has been a director of the
bank since 1968.
Mr. Turner served as president of the
Six-County Bankers Association in 1954.
Counties in the group are Marion, Mon
roe, Ralls, Pike, Shelby and Knox.
His community activities include be
ing chairman of the Cerebral Palsy
Telethon for the northeastern region of
Missouri for 1977 and a director of
Laughlin Osteopathic Hospital, Kirks
ville.
■ EU G EN E F. O RF has been named
vice president at the St. Louis Fed. He
is in charge of the personnel depart
ment and joined the bank in 1968.
■ R O BERT L. G U N TERT has been
elected assistant vice president and
manager, installment loan department,
at Country Club Bank, Kansas City.
■ R O BER T E. THOMAS, vice presi
dent in charge of bank relations at the
Kansas City Fed, has begun work as
a loaned executive with the Kansas
City office of the National Alliance of
Businessmen. He will be on loan for
the remainder of this year.

Our Mini-Bank provides
drive-in and walk-up service
at 9229 Natural Bridge.

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

■ GARY
Boatmen’s
president.
Veterans
Neb.

L. L E IF E R T has joined
Bank, Troy, as assistant vice
He was formerly with the
Administration in Lincoln.

■ REIN H O LD W. BORGMANN has
been elected a director of Missouri
State, St. Louis. He is vice president,
Missouri Savings, Clayton.
MID-CONTINENT BANKER fo r May 1, 1977

W hittle. Fisher to Speak
At Young Bankers Seminar
At Tan-Tar-A June 15-17

j.i. m a rtif co.
Business G ifts - Awards
Advertising Specialties
725 Bates
St. Louis, MO 63111
(314) 353-8337

LAKE O F TH E OZARKS—Jack W.
Whittle and John F . Fisher will be two
of the speakers at the Missouri Young
Bankers Seminar to be held at TanTar-A here June 15-17.
Mr. Whittle, chairman, Whittle
Group, Chicago, will speak June 15 on
“Marketing.” Mr. Fisher, vice presi
dent, City National, Columbus, O., will
discuss “Retail Banking and E F T ,” also
June 15. That same day, a case study
on lending, in which delegates will
take part, will be led by Robert A.
Frahm Jr., senior vice president, Mer
cantile Trust, St. Louis. Gerald R.
Sprang, president, American National,
St. Joseph, Mo., will talk on “The Bot
tom Line” on June 16. Also that day,
there will be rap sessions, free time and
the annual banquet. Speaker for the
latter will be Brad Laycock, Brad Laycock & Associates, Inc., Chicago.
The seminar will end June 17 with
talks by Arthur L. Mallory, chairman,
Missouri Department of Elementary
and Secondary Education, and Eugene
G. Bushman, legislative counsel, Mis
souri Bankers Association, Jefferson
City. In addition, there will be Young
Bankers’ committee reports.
Kenneth R. Tiemeyer, vice presi
dent, Colonial Bank, St. Louis County,
is chairman of the Young Bankers and
of its seminar program. A 1964 gradu
ate— with a commerce degree— of St.
Louis University, he has completed 21
hours of graduate work toward a mas-

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314-635-0138

FIRST NATIONAL BANK

&. TRUST COMPANY OF JOPLIN

Downtown/Southtown/Westown/Member FDIC
Member, First Community Bancorporation
WHITTLE

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

FISHER

ter s degree in finance at St. Louis Uni
versity Graduate School. After a fouryear stint in the Air Force as an officer,
Mr. Tiemeyer joined Colonial Bank in
1968 as a new business representative,
was promoted to assistant vice presi
dent-installment loans in 1969 and to
vice president-commercial loans in
1974. He also has attended several
banking schools and will be graduated
this year from the Graduate School of
Banking, University of Wisconsin.
The Young Bankers’ vice chairman
is Richard Adams, vice president, Bank
of Sikeston, which he joined in August,
1971, as assistant cashier/operations.

He advanced to assistant vice presi
dent/operations in January, 1974, and
was made vice president in charge of
operations the following December.
Mr. Adams entered banking 10 years
ago at First National, Sikeston, where
he was data processing manager. He
is a 1974 graduate of the School of
Banking of the South at Louisiana
State University, Baton Rouge.
■ GLENN A. LONG, vice president
and general manager, St. Joseph Stock
Yards, has been elected a director of
First Stock Yards Bank, St. Joseph.

■ JOHN S. PO ELK ER has been pro
moted from vice president to senior
vice president, Mercantile Trust, St.
Louis. He remains a vice president of
the bank’s HC, Mercantile Bancorp.,
and comptroller of both companies. Mr.
Poelker joined the bank as comptroller
in 1972. Before that, he was with Peat,
Marwick, Mitchell & Co. as manager,
management consulting department. In
other action, Mercantile Trust advanced
Joseph F . Dwyer Jr. and Lawrence F .
Loftus from assistant cashiers to assist
ant vice presidents, bond/ investment
department.

WOLFE

■ FLO RISSA N T BANK has elected
Elmer H. Wolfe to its board. Mr.
Wolfe is president of a North St. Louis
County feed and supply firm.

HOME OF MISSOURI’S FIRST STATE CAPITOL

See St. Charles First ! ! !

■ R O BER T D. O’LEARY has moved
up from assistant vice president to vice
president, First National, St. Louis. He
went there in 1971. The bank also pro
moted Jack J. Crawford from opera
tions officer to assistant vice president
and Robert P. DeRodes and Patricia
C. Mitchell from data processing offi
cers to assistant vice presidents.

The Place to Move Your
Home Business Industry
Assets in Excess
of
$56,000,000.00

F
FNB

ir s t

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B A N K

M em ber FDIC

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/

100

POELKER

M IS S O U R I

N O R T H M A I N , 5 th A N D F IR S T C A P IT A L

■ F IR S T NATIONAL, Kansas City,
has advanced Carter R. Harrison and
Steven E. Pohle from assistant trust of
ficers to trust officers. They both joined
the bank in 1974.

ELM A N D H A W TH O R N E

BAI Chapter Formed

C IT IZ EN S BANK
OF GRANT CITY
GRANT CITY, M 0.

W e’re looking forward to
seeing our friends at
the MBA convention in
Kansas City, May 8-10.
W. M. C. DAWSON
Chairm an

. . . with more than 96 years of
banking service.
90

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

JOHN P. DAWSON
President

The formation of the Northwest
Missouri Chapter of Bank Adminis
tration Institute has been announced.
The unit will serve banks in An
drew, Atchison, Gentry, Holt, Noda
way and Worth counties.
Chapter officers are: president—
Rex Hill, assistant vice president,
Citizens Bank, Grant City; vice
president— Larry Freeman,
vice
president, First National, Tarkio;
treasurer— Herbert Selby, vice presi
dent, Citzens State, Maryville; sec
retary— Charles Van Liere, assistant
vice president, First Community
State, Savannah.

MID-CONTINENT BANKER fo r May 1, 1 977

Security Training for Personnel
Seen as Key to Crime Problems
B R IA R C L IFF MANOR, N. Y.—
Bankers rate bad checks, holdups and
credit-card misdeeds—in that order—as
their top crime problems, but feel the
key to solving those problems lies in in
creased staff training on security mat
ters. That is a major finding of a 42page report by Burns Security Institute
called “National Survey on Bank Secur
ity.”
The Burns survey, which was con
ducted among 847 commercial and sav
ings banks, showed that 532 banks esti
mate that outsider crimes totaled $10,847,100, for an average loss of $20,390.
Bad checks were listed as a major prob
lem by 55 banks, or 66% of those sur
veyed; holdups— 129 banks or 15%; and
credit-card offenses— 114 banks or 14%.
Affecting fewer than 6% of the report
ing banks were crimes such as major
fraud, burglary and extortion, while 30%
of the respondent institutions reported
ly were unaffected by outsider crimes.
The fourth most far-reaching crime
reported by surveyed institutions was
internal theft, which involved 51 banks,
or 6%. Employee dishonesty cost 44
banks $209,400, a per-bank average of
$4,760.
Besides the most frequently men
tioned solution of better staff training,
also mentioned were stricter laws, bet
ter enforcement of security programs,
better criminal prosecutions, more
awareness of security problems by di
rectors and management, new surveil
lance cameras and better protective
equipment (such as “bullet proof” glass
and raised counters).
In the survey’s analysis, Burns notes
“a clue to where some of the fault may
lie” is in the need for more understand
ing and support from senior manage
ment.
For more information, write Burns
Security Institute, Briarcliff Manor,
N. Y. 10510.

W e ll see you at M.B.A. in Kansas City
May 8 - 1 0

A M ERICA N N ATIO N AL BAN K
BREN TW O O D BAN K
C ITY BAN K
Serving the St. Louis Area

Florissant Bank Has It from A to Z . . . Now
(borrowing from neighboring St. Louis1slogan)
The growing Florissant community demands more and more services
and now we're equipped to offer them. Our association with First
Union opens a whole range of services for our customers. Florissant
deserves it, and we can provide it— now!
Melvyn Moellering , Chairman & C .E .O .
Cyril A. Niehoff, President & C .O .O .
Dorothy C . Jasper, Assistant Vice President
Norbert W. Lohe, Executive Vice President
Rosa N. Smith, Assistant Vice President
Emma R. Scholl, Senior Vice President
Stephen Frank, Assistant Cashier
Roy F. Laramie, Vice President & Cashier
Dolores L. Biebel, Assistant Cashier
Lester H. Rosenkoetter, Vice President
Mary A. Hook, Assistant Cashier
Eugene J. Meyer, Assistant Vice President
Alice Geiser, Assistant Cashier
Carl W. Peters, Assistant Vice President

F lo r is s a n t B a n k
880 ST. FRANCOIS ST. & 13980 NEW HALLS FERRY RD.

Hometown Banks
Statewide Strength

FLORISSANT, M O.

Member of Federal Deposit Insurance Corporation

314-921-5300

■ MORGAN COUNTY BANK, Ver
sailles, has signed an affiliation agree
ment with Ameribanc, Inc., St. Joseph.

Our 86th Year Serving South St. Louis

SOUTHERN
COMMERCIAL
BANK

Daniel W. Woolley Dies
Daniel W. Woolley,
83, former v.p., Kan
sas City Fed, died
March 25. Mr. Woolley
joined the Fed in 1933,
advancing through the
ranks to v.p. in charge
of bank examinations
in 1941. He left the
Fed in 1960, joining
Columbia Union N a
tional,
Kansas
City,
where he served in
the correspondent division until his retirement
in 1970.

MID-CONTINENT BANKER fo r May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

5 5 1 5 SO U TH G R A N D BLVD.

7 2 0 1 SO U TH BROADWAY

ST. LOUIS, MISSOURI
3 1 4 /4 8 1 -6 8 0 0

Convenience Banking in S t Louis Since 1891

Member F.D.I.C.

BURY YOUR DELAYED
GRAIN DRAFT
COLLECTIONS
Our unique collection system gives
all banks immediate, one-day credit.
If you have a customer who ships grain through ■
Hutchinson, we have a collection system that can save yqu
time and money.
■
With an account relationship at the First, you can
eliminate float and stop losing the ability to invest funds.
A draft mailed right to us will be paid the day of
receipt. You won’t have to wait three days, four d aysH
or a week. Your funds will be available to invest,
usually the day after you’ve mailed your draft. ThinkJ
for a minute, how that will increase your bottom line j
at the end of a year!
To discuss how your bank can benefit
from this unique, one-day collection system, call
Gary Karrer at our New Correspondent Center^

(316)663-1521

First Notional Ben
of Hutchinson
Sherman and Main/Hutchinson, Kansas 675D1

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

K a n s a s C o n v e n t io n
Overland Park, May 11-13
Headquarters—Glenwood Manor Convention Center

PROGRAM
FIRST SESSION, 2:15 p.m., May 12 (Theater No. 2)Welcome— R. L. CUM LEY, convention chairman and senior vice presi
dent, Mission State.
Invocation.
Commentary by the President— FLO YD V. PINNICK, KBA president
and president, Grant County State, Ulysses.
50-Year Club Inductions— ELW OO D MARSHALL, KBA president-elect
and president, Home National, Eureka.
American Bankers Association Elections— L. W. STOLZER, ABA state
vice president and chairman and president, Union National, Manhat
tan.
Address—“Government: The Disease for Which It Pretends to Be the
Cure”—GEORG E F. W IL L , Washington, D. C., correspondent.
Presentation of the Arthur W. Kincade Award.

SECOND SESSION, 10 a.m., May 13 (Theater No. 2)
Installation of KBA Officers.
Presentation of New Regional Representatives.
Panel— “Where Are W e Going and How Fast?” M oderator: J. R EX
D UW E, chairman, ABA Governing Council, and chairman and presi
dent, Farmers State, Lucas. Panelists: R O BERT V. SHUMWAY, FD IC
regional director, St. Louis; JOHN R. BURT, regional administrator of
national banks, Kansas City; ROGER G U FFEY, president, Federal Re
serve, Kansas City; and EM ERY FAGER, Kansas bank commissioner,
Topeka.
Remarks—R O BERT F . BEN N ETT, governor of Kansas.

President

President-Elect

Treasurer

PINNICK

MARSHALL

STOSKOPF

Floyd V. Pinnick, KBA pres., has been
managing officer, Grant County State, Ulysses,
since 1953, holding the title of pres, there. He
originally joined the bank in 1931, but took
time out for government and army service.

KBA Pres.-Elect Elwood Marshall is pres.. Home
Nat'l, Eureka, where he is a third-generation
banker. He has worked there since his teens,
except for time spent at Bank of America, Los
Angeles, and in public accounting. He became
the bank's CEO in 1956.

MID-CONTINENT BANKER fo r May I , 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Duane M. Stoskopf, KBA treas., has been a
banker since 1963 and pres. & ch., Kendall
State, V alley Falls, since 1971. Besides working
for two other banks, he w as v.p./agricultural
loans and correspondent banking, Hutchinson
Nat'l, 1969-71.

Convention Entertainment
To Include Golf, Tennis.
Welcome 'Carnival' Party
The 1977 KBA convention theme is
“New Dimensions ’77— Council, Caba
ret, Carnival.” The meeting will be held
May 11-13 in the Convention Center of
Glenwood Manor in Overland Park. In
addition to the two general business
sessions, conventioneers will be invited
to several entertainment features.
On May 11, the men’s golf tourna
ment is scheduled at the Leawood
South Country Club and the Wolf
Creek and River Oaks Golf clubs. Buses
will start loading at 6 :3 0 a.m. at Glen
wood Manor, and the tournament will
begin an hour later. Golfers assigned to
Leawood South are asked to drive their
own cars.
Also on May 11, a tennis tournament
for men and women— doubles only—
will be held at the Kansas City Racquet
Club from 9 :3 0 a.m .-12:30 p.m. Players
will have a buffet luncheon.
The same day, there will be a lunch
eon, fashion show and shopping spree
for women. The fashion show—to be
presented by Stix, Baer & Fuller of St.
Louis, Kansas City and Springfield—
will follow the luncheon. Then, buses
will take the women to Johnson Coun
ty’s newest and biggest shopping cen
ter, Oak Park Mall.
A welcome “carnival” party will close
May 11th activities.
On May 12, there will be the govern
ing council breakfast and meeting.
Special luncheons that day will be
held for schools of banking, with John
E. Cleek, president, Johnson County
Community College, as the speaker;
Young Bank Officers of Kansas and the
50-Year Club.
That day, men and women conven
tioneers will be invited to the Nelson
Gallery-Atkins Museum in Kansas City
to view the “Sacred Circles” exhibit.
This is described as the most important

Johnson County bankers, who will be hosts to 1977 KBA convention, meet to plan activities for
annual meeting. Seated, I. to r., are: Dan Erwin and Ernest Wharton, MidAmerican Bank, Roeland
Park; Connie Long, Johnson County Nat'l, Prairie Village; R. W. Cumley, Mission State, gen'l
ch.; and L. A. Billings, Centennial Bank, Mission. Standing, I. to r., are: Arthur Chartrand, Kansas
National, Prairie Village; I. L. "Swede" Malm, National Fidelity Life, Kansas City, Mo.; Dennis
Meyer, Patrons State, Olathe; Dudley McElvain, Southgate Bank, Prairie Village; Ronald Pflumm,
Shawnee State; John Hofmann, Valley View State, Overland Park; Arthur Krebs, Southgate Bank,
Prairie Village; Norman Herrington, Olathe State; and Jack Larkin, Overland Park State.

collection of North American Indian art
ever exhibited anywhere. In Kansas
City for two months, the display con
sists of 850 objects, which took four
years to collect. It reflects a wide
diversity of Indian culture— geographi
cally strung from Alaska to Florida,
Maine to California. The exhibit repre
sents 2,000 years of North American
Indian artistic development.
The evening of May 12, a social hour
at 6 o’clock will precede the 7 o’clock
dinner. At 8 :30, entertainment is
planned—“Marilyn Maye in a Cabaret
Mood,” with music to the Big Band
sounds of Warren Durrett. Dancing is
planned from 10 to midnight.
The final day, May 13, will begin
with the men’s breakfast, with John
Erickson, president, Fellowship of
Christian Athletes, Kansas City, as the
speaker. Golf tournament prizes will be
awarded.
The convention will close with a
champagne luncheon May 13.

Is Your Correspondent Too Big To
Give You Close, Personal Service?
Southwest National is large enough to provide
correspondents with what they need, but small
enough to pay close, personal attention to your
needs.
.

C om m ittee chairm en. R. L. Cumley,
senior vice president, Mission State, is
general convention chairman. Chairmen
of the various committees are: facilities
an d transportation, Ernest M. Wharton
Jr., vice president, MidAmerican Bank,
Roeland Park; budget, Ronald Pflumm,
executive vice president, Shawnee State;
golf, L. A. Billings, senior vice presi
dent, Centennial Bank, Mission; regis
tration and housing, O. Arthur Krebs,
senior vice president, Southgate Bank,
Prairie Village; w elcom e party, Dennis
Meyer, -senior vice president, Patrons
State, Olathe; tennis, I. L. “Swede”
Malm, National Fidelity Life Insurance
Co., Kansas City, Mo.; publicity, Dan
Ervin, MidAmerican Bank, Roeland
Park;
Thursday night social/ ban qu et, Ben
jamin D. Craig, president, Metcalf State,
Overland Park; m en s breakfast, Nor
man Herrington, president, Olathe
State; YBO K luncheon, Ernest Yake,
vice president, Valley View State, Over
land Park; Thursday night entertain
ment, John Hofmann, president, Valley
View State, Overland Park; w om en s a c
tivities, Connie Long, vice president,
Johnson County National, Prairie Vil
lage; schools o f banking, Arthur Chart
rand, president, Kansas National, Prai
rie Village; 50-Year Club, John J. Lar
kin Jr., vice president, Overland Park
S t a t e ; and c h a m p a g n e l u n c h e o n ,
E. Dudley McElvain, senior vice presi
dent, Southgate Bank, Prairie Village.

JTHW EST
DOUGLAS AND TOPEKA • WICHITA, KANSAS 67202
316-264-5303
Member FDIC
94

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER fo r May 1, 1977

am -

1977 KBA
CONVENTION
May 11-13
Overland
Park!
W e 're Expectin' Y o u at the Co m m ercial
National Corral !
Renaissance Suite • Glenwood Manor!

Y'all Com e . . . A nytim e!

COMMERCIAL
NATIONAL
EL BANK

MID-CONTINENT BANKER fo r May 1, 197 7

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Hartley and Carr Are Nominees
For Pres.-Elect, Treasurer
W. C. “Dub” Hartley is the nominee
for president-elect of the Kansas Bank
ers Association, and Francis E. Carr is
the nominee for KBA treasurer.
Mr. Hartley entered banking in 1947
at American National, Baxter Springs,
where he now is chairman. He also is
president and a director of Miami
County National, Paola, and executive
vice president and a director, MidAmer
ican Bank, Shawnee Mission, both of
which he joined in 1959. From 1952-58,
he was with Commercial National, Kan
sas City (Kan.).
He is a 1956 graduate of the Gradu-

HARTLEY

ate School of Banking at the University
of Wisconsin and 1966 graduate of the
Institute for Financial Management at
Harvard University. In the KBA, Mr.
Hartley was chairman, Personnel Com
mission, 1956; and currently is chair
man, Federal Affairs Council. He has
served the ABA as a member of the
Government Relations Council and Ad
ministrative Committee.
Mr. Carr joined First National, Wich
ita, in 1948 and, in 1950, went to First
National, Wellington, where he now is
president and CEO. He is a director of
Caldwell State and First National, Med
ford, Okla. Mr. Carr is on the board of
the Kansas Bankers Surety Co. He is a
1961 graduate of the Graduate School
of Banking at the University of Wiscon
sin.
His two children are both in banking.
Sarah F. Carr is a credit analyst with
First National, Colorado Springs, Colo.
David M. Carr is assistant cashier, W il
mette (111.) Bank.
■ JAM ES O XLEY, formerly senior
loan officer, U. S. Small Business Ad
ministration, has joined United Amer
ican Bank, Hutchinson, as vice presi
dent, commercial loans. Prior to joining
the SBA, Mr. Oxley served for 12 years
with financial institutions in Wichita.

CARR

The competitive edge.
When your business plans to locate or expand in
Great Bend , we ask you to talk with our personable
officers who represent 2 0 0 years of financial ex
perience. Our competitive loan rates and quality

Convention Speakers

WILL

ERICKSON

George F. Will, Washington, D. C., correspon
dent, will speak at the KBA's first general con
vention session May 12 on "Government: The
Disease for Which It Pretends to Be the Cure."
John Erickson, president, Fellowship of Chris
tian Athletes, Kansas City, will speak at the
men's breakfast May 13.

■ NORTH PLAZA STA TE, Topeka,
has completed remodeling its Main Of
fice. The project consisted of reorganiz
ing space in the main lobby, drive-up
tellers area, loan and bookkeeping de
partments. A sit-down tellers station
was added for new accounts and spe
cial customer service. Also added were
several private loan offices. Space plan
ning and construction management
were provided by the Bunce Corp., St.
Louis.
M VAN B. NORRIS has been elected
president, Bank of Horton, succeeding
his mother, Mrs. Marguerite Norris,
who has been named chairman. For
rest R. Keener was promoted from vice
president and cashier to executive vice
president, Virginia Meerpohl was
raised from assistant cashier to cashier,
Marcia Williams was named assistant
cashier and A1 Wei ton was named loan
officer. Doreen Holsman was named
secretary to the board. Mr. Norris is
the third member of his family to head
the bank, which recently celebrated its
90th anniversary.

banking service are the result of sound management,
fust what you’re seeking.

Speaker Is Pulitzer Winner

S ta te S ^

a n i

Main Bank, 17th & Main
Westgate Bank, Broadway at K -96
Great Bend, Kansas
316-792-2521

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

George F. Will, a speaker on the
Kansas Bankers Association conven
tion program, has been awarded a
Pulitzer Prize in journalism for dis
tinguished commentary on a variety
of topics. He has been writing the
national column for the Washington
Post Writers Group since early 1974.
The column appears in 215 news
papers other than the Washington
Post. He also serves as the national
editor of National Review magazine,
writes a fortnightly column for
Newsweek and is a commentator on
the Post-Newsweek radio and TV
stations.
MID-CONTINENT BANKER fo r May 1, 1977

Lto R: Bill Webber, Chairman of the Board; Bob Fitzpatrick, Vice-President; Ken Domer,
Second Vice-President; Bob McDowell, Assistant Vice-President

Well make a trade with you:
Some food for thought
During the upcoming KBA Convention, well provide the food if
you'll provide the thoughts — thoughts on how we can better serve
your personal correspondent banking needs. Our goal has always
been to provide you with the very finest in correspondent banking
services, and in order to continue to do so we want you to keep us
informed of your needs.
So join us for "Brunch with the Bunch*" ... it's sure to be a beneficial
exchange.

w-,th the Bunch”
'R e f r e s h m e n t s , B u f f e t
T h u rsd ay , ^

A M t« ^ 5 4 5

*The entire Security Correspondent Team will be your hosts.
Joining those pictured above will be: President, Gray Breidenthal; Assistant to the President, Bob Domer; Executive VicePresident, Ramey Beachly; Senior Vice-President, Jay Breidenthal; Vice-President, John Peterson; and Vice-President, John
Macleod.

SECURITY
NATIONAL BANK
OF KANSAS CITY
One Security Plaza
Kansas City, Kansas 66117
Dial D ire ct— 913-281-3165

MID-CONTINENT BANKER for May 1, 197 7

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

Something to Smile About:

Dental Week Activities
Underwritten by Bank
If the young people of Topeka don’t
start having good dental checkups, it
won’t be the fault of that city’s First
National. The bank was the sole under
writer of activities held in Topeka dur
ing National Children’s Dental Health
Week earlier this year. In addition, the
bank distributed free toothbrush kits at
its three locations.
Demand for the kits was so great that
the 6,000 originally ordered by the

bank ran out, and First National had to
order 600 additional kits. Each kit con
tained a toothbrush, four “disclosing”
wafers (red tablets, which, when
chewed, reveal location of plaque on
teeth) and a dental-hygiene booklet.
According to First National’s vice presi
dent and director of marketing, Roger
H. Franzke, the kits were purchased
from a dental supply house at a cost
of 200-250 per kit.
The idea originated when area den
tists approached the bank to see if it,
along with other banks in Topeka,
would take part in a free toothbrush
program. Mr. Franzke told the dentists

National Children’s Dental Health Week
Sponsored by T o p e k a ’s

D ental S o ciety

February 6-12
TOPEKA'S FIRST NATIONAL BANK
Proudly supports this im portant event!

FIRST NATIONAL BANK O F TOPEKA

This n e w s p a p e r a d to ld Topeka re sid e nts a b o u t
fre e d e n ta l h y g ie n e k its a v a ila b le to a ll c h il
d re n in a re a fro m First N a t'l. D em a n d w a s so
g re a t th a t b a n k e x h a u s te d its o r ig in a l o rd e r o f
6,0 0 0 k its a n d h a d to o rd e r 600 m ore.

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that if they would allow his bank to
distribute the kits at its three locations
exclusively, First National would take
on the whole program and its related
costs. Naturally, says Mr. Franzke, the
dentists were enthusiastic.
Besides being distributed at the
bank’s locations, bank officers made spe
cial presentations of them to many so
cial agencies, including Head Start,
day care centers and the like.
Before the promotion started, bank
officers made personal calls on every
dentist in Topeka to acquaint them
with the program and to explain the
bank’s involvement in Children’s Dental
Health Week.
Mr. Franzke says First National used
its regular advertising budget and
schedules during the week to promote
the activities. In addition, the bank
handled all press and public relations
activities.
First National used newspaper, TV
and radio to advertise its participation
in National Children’s Dental Health
Week. Mr. Franzke was interviewed
about the bank’s program on TV, and
William A. Adkins Jr., the bank’s senior
vice president, was interviewed on a ra
dio program broadcast from a cafeteria.
■ MARK PLAZA STA TE, Overland
Park, has been purchased by a group
comprised of James H. Hentzen, Kan
sas City attorney; Terrence J. Holleron, Kansas City insurance executive;
GayIon M. Lawrence of Poplar Bluff,
Mo., and Bernard A. Hentzen, Wichita
contractor. No management changes
are expected, according to Sam Blasco,
president.

MID-CONTINENT BANKER for May 1, 1977

“I never forget
a face”

Jim Stanley

...you’ve heard people say
that — maybe you’ve said it
yourself. We hope you’ll also
remember our names: Jim
Stanley and Paul Richmond.

Paul Richmond

We’ll all be at the KBA in
Overland Park May 11-13.
We’d like to visit with you about
our P.M.S. (Portfolio
Management System). It’s our
computerized system to keep
your bond portfolio up-to-date.

Thanks.

FIR5T N
f.d.i.c.

First National Bank in W ichita

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Sometimes New \bdk
doesn’t know when to stop.
New York can be Tomato
Mornay for breakfast, Central
Park for lunch, eighty-seven
stories up for dinner and the
Jeffrey Ballet for dessert.
It can also be too much.
That’s why there’s a Barclay.
The Barclay is a small hotel
on the east side. (The lobby is

titty teet across, i ne big
Conference Room holds twenty
people.) The Barclay is quiet,
calm. It’s elegant without being
Stuffy, expensive without
being ridiculous.
Next time you’d like New
York to go on without you for a
while, remember The Barclay.

DICKERSON

DUWE

■ COM M ERCIAL NATIONAL, Kan
sas City, has elected J. Rex Duwe,
M. Max Dickerson and Laurence R.
Jones Jr. to its board. Mr. Duwe, chair
man of the ABA’s governing council,
is president and chairman, Farmers
State, Lucas; Traders State, Glen
Elder; and chairman, Sylvan State. Mr.
Dickerson is senior vice president and
a former advisory director at Commer
cial National as well as a director of
Hoxie State and Edwardsville State.
Mr. Jones is chairman and president,
Southern Royalty Corp., investment
management firm.

Hutchinson Data Center Banks
Join Via Network in Wichita

When enough New York's enough.
48th just off Park. (800) 221-2690. In New York State, (800) 522-6449.
In the city, 755-5900. Or call your corporate travel office or travel agent.

100

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Federal Reserve Bank of St. Louis

W ICHITA— Fourth National’s Via
Electronic Banking Network—intro
duced in this area in the fall of 1976—
has been joined by member banks of
Data Center, Inc. The latter is a coop
erative data processing center located
in Hutchinson, Kan. It’s owned by its
46 member banks, but handles data
processing for 54 banks in central and
western Kansas.
Fourth National also processes data
for about 70 banks, and the resultant
electronic-terminal network would be
one of the most extensive in the U. S.,
according to a Fourth National spokes
man.
With the addition of the Data Center
banks, Via membership now includes
59 participating banks. Via cards have
been issued to approximately 85,000
card holders to permit these bank cus
tomers to conduct routine banking
transactions 24 hours a day through
eight automated teller machines on the
premises of various participating banks,
19 point-of-sale terminals in nine
supermarkets and 25 check-guarantee
terminals in convenience stores and
gasoline stations. It’s anticipated that
by the end of this year, the Via net
work will include 175,000 card hold
ers, 27 ATMs and 135 POS and checkguarantee terminals.
MID-CONTINENT BANKER for May 1, 1 9 7 7

In v estm en t B a n k in g S in ce 1 8 9 0

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CONTACT OUR OFFICE MOST CONVENIENT TO YOU:
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O K L A H O M A CITY, OK 73102
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405-235-6601

ST. LOUIS, M O 63102
500 N. Broadway
314-342-2000

TULSA, O K 74120
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101

Left to right: Marvin Bray, C h a rles R ice, Dan Keating

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Member F.D.I.C.

102

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Federal Reserve Bank of St. Louis

1 1 ||

MID-CONTINENT BANKER for May 1, 1977

O k la h o m a C o n v e n t io n
Chairman

Tulsa, May 10-11
Headquarters—Sheraton Skyline Hotel

PROGRAM
KELLY
O B A ch. Tracy K e lly is pres. & ch., A m e rica n
N a t'l, B ris to w , a n d ch., C itizens S tate, O ke m a h .
He is d ir. & tre a s ., M id -A m e ric a A u to m a te d
C le a rin g House A ssn., K ansas C ity , a n d
serves on th e U. S. S m all Business
A d m in is tra tio n 's a d v is o ry council.

President-Elect

FIRST SESSION, 9 a.m., May 11
Call to Order—TRACY KELLY, chairman, Oklahoma Bankers As
sociation, and president and chairman, American National, Bristow,
and chairman, Citizens State, Okemah.
Introduction of New 50-Year Club Members.
Address—PH ILIP C. JACKSON JR., member, Board of Governors,
Federal Reserve System.
Chairman’s Message—TRACY KELLY.
Presentation of Service Awards.
Adjournment.

SECOND SESSION, 2 p.m., May 11

ALLISON
S e rvin g as O B A pres.-elect is W a lte r V.
A llis o n , ch. & CEO, First N a t'l, B a rtle s v ille .
He jo in e d th e b a n k in 1955 a n d served as
pres, fro m 1969 to 1976. He is a lso ch. &
CEO, First Bancshares, Inc.

Treasurer

Call to Order—TRACY KELLY.
Address—A. A. “BUD ” MILLIGAN, president-elect, American Bank
ers Association, and president, Bank of A. Levy, Oxnard, Calif.
Meeting of ABA Membership—FRANK G. K L IEW E R JR., ABA vice
president for Oklahoma, and president, Cordell National.
Installation of New President.
Message of New President—W A LTER V. ALLISON, chairman, First
National, Bartlesville.
Election of New President-Elect and Treasurer.
Adjournment.

Convention Speakers

ANDERSON
John V . A n d e rs o n , pres., First N a t'l, El Reno,
is O B A tre a s . He s ta rte d b a n k in g in 1947 a t
L ib e rty N a t'l, O k la h o m a C ity, a n d m o ved to
his p rese n t b a n k in 1973 as e .v.p . He
re ceive d th e O B A 's p re s id e n tia l a w a rd fo r
o u ts ta n d in g service in 1975.

MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

M ILLIG A N

KLIEWER

103

Abbreviated Program
Planned by Oklahomans
For Annual Convention

TH E m eeting place in

DALLAS
for any event :

conventions
sem inars
trade shows
sales m eetings
training classes
receptions
weddings
parties
dinner dances
42 individual meeting rooms accommodating 10 to
5000 persons . . . 365 modern, sound engineered,
tastefully decorated sleeping rooms and suites. . .
excellent dining room and coffee shop . . . lounge
and supper club . . . nightly dancing and entertain
ment . . . two large swimming pools. . . golf adjoin
ing . . . across from the fabulous NorthPark Shop
ping Center . . . 7 minutes from downtown Dallas
. . . Helicopter service . . . free parking for 1500
automobiles...................................................... .. .direct
Surtran bus service to and from Dallas/Fort Worth
Airport (7 A M - 11 PM).

TULSA—An abbreviated program is
on tap for this year’s Oklahoma Bankers
Association convention, to be held May
10-11 at the Sheraton Skyline Hotel,
Tulsa.
Both business sessions will be held
on Wednesday, May 11, which will
permit delegates to get home a day
earlier than usual. It is expected that
the new format will encourage in
creased attendance.
Tuesday’s business activities will be
devoted to the trust division, and the
annual banquet, featuring Red Skelton
this year, will be held Tuesday evening.
Heading the business session speak
ers’ list this year are Fed Governor
Philip C. Jackson and ABA PresidentElect A. A. “Bud” Milligan, president,
Bank of A. Levy, Oxnard, Calif.
Other highlights of the business ses
sions will be the chairman’s report,
given by Tracy Kelly, president and
chairman, American National, Bristow,
and chairman, Citizens State, Okemah.
Mr. Kelly will be standing in for Pat
Moore, who was elected OB A president
last year, but who resigned his post
late last year.
Others appearing on the program in
clude Frank G. Kliewer Jr., president,
Cordell National, who will conduct the
ABA portion of the meeting, and W al
ter V. Allison, chairman, First National,
Bartlesville, who is expected to assume
the vacant president’s post during the
convention.
■ P. C. LAUINGER has retired as
director, Bank of Oklahoma and BancOklahoma Corp., Tulsa. Succeeding
him as a bank director is his son, Philip
C. Lauinger Jr. The elder Mr. Lauinger
was named to the Bank of Oklahoma
board in 1942 and is chairman of Pe
troleum Publishing, Parker Drilling,
Derrick Publishing Co. and Texas MidContinent Oil & Gas Association. His
son is a director of Petroleum Publish
ing, Derrick Publishing, MAPCO, Inc.,
International Petroleum Exposition &
Congress and American Business Press,
Inc.

F o r R eservation s/In form ation

CALL CO LLECT
214 363-2431
-

o r t h P a r k in n
and C onvention C e n te r
9300 North Central Expressw ay
Dallas, T exas 75231
104

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Federal Reserve Bank of St. Louis

■ B IL L R. PEN DLETO N , assistant
vice president, has been promoted to
vice president, Fidelity Bank, Okla
homa City. He serves as portfolio ad
visory officer, investment division.
■ U N ITED BANK, Tulsa, has ad
vanced Dennis Neibling from assistant
vice president to vice president and
Martha Cravens from assistant cashier
to assistant vice president.
MID-CONTINENT BANKER for May 1, 1977

Investment ingenuity, information and the
insight you need to manage your
hank successfully.
Fidelity Bank Executive Vice President Jim
Baker and his staff . . . Ken Scoggins, Roy
Remmert, Steve Porter, Bill Pendleton, Doug
McQueen, Carl Holliday, Craig Stanley and
Terry M cFarland . .. are geared to provide
com plete investm ent advisory services to
help correspondents achieve m axim um
do
bottom line perform ance,
H H H |[
Contact th e professionals
a t Fidelity for assistance |H H h RT

and instant information
on today’s money
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Federal Reserve Bank of St. Louis

M rH I
BEE

Steve

The Bank of Excellence

Fidelity Bank
R obinson at Robert S. Kerr • O klahom a C ity • (405) 272-2087

Member F.D.I.C.

C o n v e n t io n
President

Dallas, May 8-10
Headquarters—Fairmont Hotel

PROGRAM
GREENWOOD
S. R. G re e n w o o d is TBA pres., a n d pres.,
Tem ple N a t'l, a n d In ve sto rs D ive rsifie d
D e v e lo p m e n t C orp ., Inc. He is im m e d ia te
p a s t ch., G o v e rn o r's State C om m itte e on
A g in g , a n d ch a irs th e TBA's n e w -fa c ilitie s ,
b u d g e t a n d s ta te -c o n v e n tio n -p la n n in g
com m ittees.

SUNDAY, MAY 8
10-11 a.m.— Committee Meetings.
10 a.m.-6 p.m.— Registration and Exhibits.
6-8 p.m.— Opening Night Reception and Buffet, Dallas Music Hall.

MONDAY, MAY 9
Vice President

9:3 0 a.m.— Opening Business Session, presided over by S. R. G REEN
WOOD, president, Texas Bankers Association, and president,
Temple National.
10 a.m.—Address—“Banking in 1977,” W. LIDDON M cPETERS,
president, American Bankers Association, and president, Security
Bank, Corinth, Miss.
10:30 a.m.—Address— “Prices, Profits and Productivity—Where Are
We Headed?” DR. C. JACKSON GRAYSON JR ., chairman, Amer
ican Productivity Center, Dallas.

CHILDERS
C harles L. C hild e rs, TBA v .p ., is pres., T yler
B a n k, w h ic h he jo in e d in 1957. He is a
fo rm e r e x a m in e r fo r th e D alla s Fed.

11 a.m.— National Bank Division Meeting with guest speaker H. JO E
SELBY, first deputy Comptroller of the Currency, “Changes in
Banking and Bank Supervision.”
11 a.m.— State Bank Division Meeting with guest speaker DANIEL
A. FLYNN, deputy commissioner of banking for Texas, “New Ex
amination Procedures.”
12:30 p.m.— Reception-Luncheon with guest speaker LIZ CARPEN
TER .
6-8:30 p.m.— Reception and Banquet.

Treasurer

8 :3 0 p.m.—Entertainment by BARBARA ED EN
FITC H Orchestra.

and the MAL

TUESDAY, MAY 10
9:3 0 a.m.— Business Session.
10 a.m.— Meeting of Texas Members of ABA— BOOKMAN P E TE R S,
ABA vice president for Texas, and president, City National, Bryan.
10:30 a.m.— Committee Reports.
11 a.m.—Address—L. FRANK PITTS, Pitts Oil Co., “Energy and
Politics.”
DUFFEY
TBA Treas. is R. M . D u ffe y Jr., ch., Pan
A m e rica n Bank, B ro w n s v ille . He is a fo rm e r
v . ch., TBA State D iv. a n d m e m be r, le g is la tiv e
com . He is ch., TBA D istrict II.

106

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

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Left to right: Brad Sledge, Steve Aycock, Leonard Magruder,
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Federal Reserve Bank of St. Louis

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MR

Varied Program Set
For TBA Convention
In Dallas May 8-10
DALLAS—A varied program of
events awaits those planning to attend
the 93rd annual Texas Bankers Associa
tion convention, scheduled for May
8-10 at the Fairmont Hotel, Dallas.
Departing from tradition this year,
there will be no special program for
spouses. Rather, spouses are encour
aged to attend the business sessions.
The main event for opening day,
May 8, is a reception and buffet at the
restored Dallas Music Hall, followed by
an hour-long “pop” concert by the
Dallas Symphony.
Monday evening’s entertainment in
cludes dinner at the Fairmont and a
show by Barbara Eden, singer and
dancer, and the Mai Fitch Orchestra.
Heading the speaker’s list this year
will be W. Liddon McPeters, ABA
president, and president, Security Bank,
Corinth, Miss. His topic will deal with
banking in 1977. Also set as a speaker

is Dr. C. Jackson Grayson Jr., chair
man, American Productivity Center,
Dallas, whose topic will be “Prices,
Profits and Productivity—Where Are
We Headed?”
Speaking at the national division
meeting will be H. Joe Selby, first
deputy Comptroller of the Currency,
whose topic will be “Changes in Bank
ing and Bank Supervision.” His coun
terpart at the state division meeting
will be Daniel A. Flynn, deputy com
missioner of banking for Texas, who
will discuss new examination proce
dures.
The Monday luncheon speaker will
be Liz Carpenter, assistant to Lady
Bird Johnson during the Johnson’s
White House years. She is now as
sociated with the Johnson Library at
the University of Texas in Austin.
Also set to speak before the conven
tion is L. Frank Pitts, owner of Pitts
Oil Co. His topic will be “Energy and
Politics.”
Program chairman is Charles L.
Childers, TBA vice president, and
president, Tyler Bank.

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

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Helping you is what correspondent
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MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

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109

NEWS
From the Mid-Continent Area
Alabama
■ THOMAS W. DIAMOND has joined
Farmers & Merchants Bank, Centre, as
vice president, loan department. He
spent three years at First National, Cedartown (formerly Liberty National),
and, in 1971, joined the state banking
department as an examiner. Last No
vember, Mr. Diamond was placed in
charge of planning examination pro
cedures for banks with several hundred
employees and numerous branches
whose assets range from $100 million to
$300 million.

■ F IR S T NATIONAL of Mobile’s
Oak Plaza Office has opened in tem
porary quarters at Moffat and Schillinger roads. The office houses facilities
for two tellers stations and a drive-up
station.

man, Worthen Bank, Little Rock, has
been elected to the board of First Ar
kansas Bankstock Corp. He joined
Worthen initially in 1966, left in 1972
and rejoined the bank in 1975 in his
present position.

Arkansas

■ JOHN ARNOLD has been named
district manager of the Little Rock Of
fice of SLT Warehouse Co., going there
from the firm’s Southern Division Office
in Memphis. SL T is headquartered in
St. Louis.

■ B IL L I. C RU TC H FIELD has been
elected president and CEO, First Na
tional, Mena, succeeding Robert L.
Stringer, who has resigned to accept
a senior management position with an
HC in Oklahoma. Mr. Crutchfield is the
former senior vice president and cashier
of First National, Hot Springs.
■ UNION BANK, Benton, has elected
the following local realtors as directors:
J. Fred Walton Jr., I. E. McCray Jr. and
Lilburn W. Carlisle.

D IA M O N D

AD AM S

■ N. Q. ADAMS has been elected
senior executive vice president and di
rector of First Bancgroup-Alabama,
Inc., Mobile. He joined the affiliate,
First National, Mobile, in 1951, ad
vancing to senior executive vice presi
dent in 1974. One year later, Mr.
Adams was named executive vice presi
dent of the HC.

■ CITIZEN S NATIONAL, Decatur,
has promoted Coleman Hutchins from
assistant vice president and trust offi
cer to vice president and trust officer,
Allan S. Penwell from commercial
banking officer to assistant vice presi
dent-commercial banking and Glenn
Ramey to installment loan officer. Mr.
Hutchins went to the bank in January,
1976, Mr. Penwell in 1974 and Mr.
Ramey in 1972.

New Banking Commissioner
TAYLOR

ARNO LD

■ R O BERT P. TAYLOR, vice chair-

WE SALUTE AMBI
O FFICERS

DIRECTORS

Harry E. Cruncleton, President
Kenneth W. Oesterle, Senior Vice President
A. Clay Williams, Senior Vice President
Elmer J. Arnold, Vice President
Quinten Spivey,

Lawrence E. Snyder, Chairman

SPRINGFIELD—William C. Har
ris of Pontiac has been appointed
commissioner of banks and trust
companies by Governor James R.
Thompson. His appointment took ef
fect May 1, and his yearly salary is
$30,000.
Mr. Harris served six years in the
Illinois House and 16 years in the
Senate before retiring from the Gen
eral Assembly last January.

Maurice E. Bone
Gerald L. Bratsch

Vice President & Trust Officer
Terry W. Schaefer,

Harry E. Cruncleton

Vice President

Kenneth G. Andres, Vice President
Charles E. Lynch, Vice President
Alice L. Gannon, Assistant Vice President

Lloyd C . Farquhar, Jr.
James R. Hayden

& Cashier

Charles P. Eckley, Assistant Vice President
Mary Jo Hanvey, Assistant Cashier
Helen C . Harriss, Assistant Cashier
Sharon L. Seibert, Assistant Cashier
Betty Evans, Assistant Cashier

Bank of

Robert E. McGlynn
Joseph N. Millard
Kenneth W . Oesterle

Belleville

B E TTE R
4800 W. Main St.
1300 North Belt West

Illinois

BANKING

Belleville, Illinois
Sw ansea, Illinois

HARROW SMITH COMPANY
U nion N a tio n a l B a n k B ld g .

Member FDIC

5 0 1 /3 7 4 -7 5 5 5

L ittle Rock, A rk a n s a s
J. E. WOMELDORFF, E xe cu tive V ice P resident
_______________________________________________

I io

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Federal Reserve Bank of St. Louis

MID-CONTINENT BANKER for May 1, 1977

the bank publication
for farm customers
• Serious answers to difficult financing questions facing
your customers
• 8 pages published quarterly in full color
• Personalized to your bank’s image
Recent topics:
Credit lines: what are the danger signals?
Land values, ownership and financing
Planning your financial statement
I.R.A. - H.R. 10 programs
Estate Tax reform
Hog facilities - what do they cost?

Farm Finance
c/o NORTHWESTERN BANKER
306 - 15th Street
Des Moines, Iowa 50309
515/244-8163

Tax planning in 1976
At no obligation, please send a sample copy with
prices and an order form.

Your farm customer is important.
Let him know it!

Name______________________________________
Bank_____ __________________________________
Address
City____

State.

Zip.

The spring issue is now available to order.
MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

Mississippi

Indiana

A 'M U S T'

■ D EPO SIT GUARANTY NATION
AL, Jackson, has promoted S. Reagan
Coleman Jr. and James S. McIntosh to
assistant vice presidents, Ruth BrinsonCraig to personnel officer, Larry Q.
Cantrell and Milton B. Weems Jr. to
assistant trust officers, Linda D. Gran
tham to branch officer and C. Douglas
McCain to credit card officer.

Economic, Tax Seminar Held

for Directors of
State-Chartered
Banks!

R ichard D oe rm e r (I.), p re s id e n t, In d ia n a B ank,
Ft. W a y n e , is sh o w n w e lc o m in g E lio t J a n e w a y ,
econ o m ist, to b a n k 's recent econom ic a n d ta x
se m in a r, a tte n d e d b y m o re th a n 6 50 lo c a l
businessm en. P urpose o f s e m in a r w a s to p ro
v id e in fo rm a tio n to e n a b le businessm en to
m a ke m o re e ffe c tiv e business ju d g m e n ts .

"Bank Shareholders'
Meeting Manual"
A 60-page book designed to enable
directors of state-chartered banks to
bring their operations up-to-date. It
was developed in recognition of several
new trends in business and society—
trends involving an increased sensitivity
of the public regarding conflicts-ofinterest; greater concern fo r minority
rights; greater demand fo r fu lle r dis
closure; data on control and ownership
and of related business interests, includ
ing voting of trust-held securities.
The book also provides a means fo r
state bank directors to modify pro
cedures to bring their banks into com
pliance with current state banking
statutes and regulations. Its use can
result in economies and efficiencies for
banks.
C a n Y o u r B a n k A f f o r d to b e
O u t-o f-D a te ?

PRICE:
$7.75 each
SEND YOUR ORDER AN D
CHECK (sorry, no billed orders)
TO THE PUBLISHER:

The BANK BOARD Letter
408 Olive St. (Suite 505)
St. Louis, Mo. 63102

112

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Federal Reserve Bank of St. Louis

■ AMERICAN
FL E T C H E R
NA
TIONAL, Indianapolis, has named the
following vice presidents: John W.
Eyler, Samuel A. Lasiter, Thomas J.
Meltzer and J. William Rice. Mr. Meltzer is also a trust officer and Mr. Rice
is also an investment officer. New as
sistant vice presidents are Robert A.
Fisher, Michael H. Johnson, Joseph N.
Lockhart, E. Louise Nahas, David L.
Petro, Gary W. Williams and C. Mi
chael Wright. Ronald M. Brown was
named assistant vice president and
trust officer. Walter B. Kirkwood, vice
president, is handling community and
legislative affairs for the bank.

Kentucky
■ L IB E R T Y NATIONAL, Louisville,
has promoted John M. Shaver III and
James M. McDonnell to the newly cre
ated positions of regional vice presi
dent/ branch administration. Mr. Shav
er manages the bank’s city branches
and Mr. McDonnell handles the county
branches. Roy F. Bary Jr. has succeed
ed Mr. Shaver as manager of the Main
Office. He is now senior lending officer,
branch banks. L. Thomas Edrington
Jr., vice president, has succeeded Mr.
Bary as manager of the bank’s largest
branch.
■ TH E F E D has approved a move by
Farmers Bancshares, Inc., Hardinsburg,
to become an HC through acquisition
of Farmers Bank, Hardinsburg, and to
engage as an agency in the sale of
credit life, accident-and-health and haz
ard insurance.

9 BARBARA MIZE has been named
president, Rightway Travel Agency,
Inc., a subsidiary of Deposit Guaranty
National, both of Jackson. Mrs. Mize
joined Rightway Travel in 1954.

New Mexico
■ L IB E R T Y NATIONAL, Lovington,
has announced the following promo
tions: to assistant cashiers—Phyllis
Barnes, Panda Turner and Joyce Drewry; to assistant trust officers—Dixie
Wise and Carolyn Goff; and to auditor
— Ginger McCaw.
■ JO E SHERMAN has joined Hot
Springs National, Truth or Conse
quences, as cashier. He formerly held
a similar position at Hale County State,
Plainview, Tex. In addition, Sadie Ren
fro has advanced to vice president at
Hot Springs National.
■ B E T T Y HODGE has been named
assistant yice president, First National,
Clovis, while the following promotions
also have been announced: Alana K.
Owens, to assistant cashier, and Betty
Moshier and Pierrette Stricklin, to bank
officers.

Norville Davis Dies
Norville E. Davis, 69, retired
banker and past president of the
New Mexico Bankers Association
died March 15 in Tucson, where he
had been living since 1971.
He served as vice president, First
State, Gallup, and held a similar
position at Grants First State.

MID-CONTINENT BANKER for May 1, 1977

Bank Sponsors Display
Of Minority Activities
■ SAM W. BARTHOLOM EW JR.,
senior vice president, First Amtenn
Corp., Nashville, has resigned to enter
private law practice. He joined the HC
in 1973 as director of corporate devel
opment in charge of bank acquisitions
and mergers. He subsequently served
as executive vice president and chief
operating officer, Guaranty Mortgage
Co. and senior vice president, market
ing, First American National Bank.
■ F IR S T AMERICAN BANK, Knox
ville, has promoted Heiskell Howard
and Larry E. Brown to assistant vice
presidents. Billie P. Eversole, vice
president, has assumed additional re
sponsibilities as coordinator of branch
activities. Mr. Howard joined the bank
in 1970; Mr. Brown was previously
with First American National, Nash
ville.
■ HAMILTON BANK, Johnson City,
has named Dan M. Laws III branch
manager, Janie Stout assistant cashier
and assistant branch manager and
Evelyn Williams assistant vice presi
dent. Mr. Laws joined the bank in
1971, Mrs. Stout in 1968 and Miss Wil
liams in 1946.
■ TH IRD NATIONAL, Nashville, has
promoted Lewis Howard to assistant
vice president from credit officer. He
joined the bank in 1973.

TV Program 'Tops'
WASHINGTON, D. C.—The ABA
reports that an hour-long CBS TV
special, “The Miracle Months,” at
tracted a larger audience and more
public response than any previous
program cosponsored by the associa
tion.
Televised March 16, the program
on human conception, gestation and
birth featured actual film of live em
bryos as well as mothers during
pregnancy and birth.
The program attracted about 30
million viewers, says Lee Gunder
son, chairman, ABA Communica
tions Council, and president, Bank
of Osceola, Wis. It received a 21.1%
rating, representing 33% of the TV
sets in use during the broadcast
hour, according to Mr. Gunderson.
Scores of phone calls and letters
were received as a result of the pro
gram, with virtually all the reaction
being highly favorable, he points
out.

“People Who Help” was the theme
of the display sponsored by First Amer
ican National, Nashville, at the city’s
Fifth Annual Black Cultural Heritage
Exposition held at the Municipal Audi
torium.
The four-panel photographic display
featured black businesses and entrepre
neurs that First American has helped
in recent years. Also featured in the
display were some of the bank’s black
employees who are involved in commu
nity activities.
During the event, First American’s
booth was manned by bank employees
who talked with visitors and answered
questions about bank services. More
than 65,000 people visited the exposi
tion.

Bank Sponsors Concert
By Local Youth Orchestra

(Continued from, p ag e 8)
—or are not— willing or able to have
credit accommodation through such
things as a bank credit card. A partial
solution to such a situation is a package
of financial accommodations and an
evening of the balance between cash
outgo and cash income. If a utility bill
is predicted—or likely—to be, for ex
ample, $1,200 a year but with very
high peaks of $200 or more in each
winter month and in the summer
months, it makes a lot of sense to level
off the payments each month at ap-

P P P P P P P

f f FOR THE
RIGHT MAN

“The Sound of Music Worldwide”
was the title of a concert performed by
the Barren River Area Youth Orchestra
and sponsored by Citizens National,
Bowling Green, Ky. The event was held
in Western Kentucky University’s Van
Meter Auditorium.
The program included music ranging
from compositions by Mozart to works
by Humperdinck. In addition, the
Bowling Green Community Chorus was
featured in several selections.
“The Sound of Music Worldwide”
was the second free concert sponsored
by Citizens National; in April, 1976,
the bank held a special bicentennial
concert, “The Sound of Music in Amer
ica.”

r
f f T f \ T f

THE
RIGHT JOB

f.P .O R

Novel ’Incentive Premium’
Is Donation to Charity
Depositors of Commercial National,
Peoria, 111., were able to take part in
a novel “premium” program. The
bank’s customers were given a chance
to decide to which charities Commer
cial National should make donations.
Each time a charitable organization’s
name was chosen by a qualified bank
depositor during a one-month period,
a $5 contribution was made to that or
ganization. A $500 bonus contribution
went to the American Cancer Society,
since its name was chosen most fre
quently by depositors. Other mostpicked organizations were the Heart
Association and the St. Jude Midwest
Affiliate; nearly 50% of the organizations
chosen by customers were Peoria-area
churches and related organizations.

MID-CONTINENT BANKER for May 1, 1977

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Federal Reserve Bank of St. Louis

PAP

fl*

. . . exe cu tiv e personnel ^
for banking, fin an ce
and related fields
contact

TOM CHENOWETH, A
1

m anager

p FINANCIAL?’
PLACEMENTS^'
/9Ì2 Baltimore,Kansas City, Mo.

—
1

M Si
113

proximately $100, taking the low-usage
months during spring and fall into con
sideration. True, this can and should be
budgeted for, but it is not done by a
significant portion of the public.
A similar analogy can be drawn for
insurance and auto expenses and for
monthly totals of grocery bills resulting
from a weekly, or more frequent, shop
ping pattern.
Many U. S. families still are making
periodic payments by check, but those
payments could be handled more effec
tively on a PAP electronic basis. Bank
ers are moving rather cautiously into
the mainstream of E F T via a number
of different vehicles, i.e. check guaran
tee cards, debit cards, use of “touchtone” systems to switch funds, etc.,

nology, often have fought the imple
mentation of PAP-EFT systems.
Recent studies by nonbank organiza
tions such as utilities and insurance
companies show that over nine out of
10 of those surveyed (which may not
be universally representative) would
recommend some limited type of PAP
system to their friends. The PAP sys
tem most favored related to pre-autho
rization of utility payments. Bank credit
card pre-authorizations of payment
(which, incidentally, I have used and
enjoyed for some time without experi
encing any adverse incidents) are ac
cepted by only 3% as systems that are
to be recommended or utilized.
If such fragmentary studies are rep
resentative, then I think it indicates

" N o w is the time for banks to educate customers— in a lowkeyed m anner— to the implications, advantages and disadvan
tages of pre-authorized paym ents."
while still relying in large part on paper
entries of an untruncated nature. It is
prudent that we do so for the present,
since errors involving an unwarranted
change in the payment mechanism can
be rather costly.
Banking’s competitors—the S&Ls and
the national chains of department and
food stores—have not been unaware of
the importance of obtaining the opti
mum position in any system that does
evolve. In some instances, our competi
tors have distinct advantages over banks
in not being subject to the costly regula
tions bankers must bear as their cross.
Banking’s competition also has a leg up
on banks in that products and services
they offer have a built-in mark up,
while banks have to pay for their
main ingredient (deposits) either with
actual interest or with implicit interest.
Food chains, dealing with necessities of
life, are likely to get a customer trafficpattern that’s conducive to cross selling
the grocery’s “bank services”; a bank’s
lobby traffic would not be likely to gen
erate sales of food, goods and related
services.
The enigma of marketing interpreta
tion. Some rather dated marketing sur
veys in this area have shown that, up
through the 1960s, our checking system
probably was doing a more satisfactory
job for American consumers than the
foreign GIRO systems were doing for
the nationals of their countries. Those
studies also revealed a puritanical op
position by substantial numbers of
Americans to switching from a well run
and proved checking paper-entry sys
tem, which the individual “controls,” to
one involving paper truncation and preauthorization of payments. Self-appoint
ed “consumerists,” rather than applaud
the additional benefits of PAP’s lower
costs and improved utilization of techI 14

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Federal Reserve Bank of St. Louis

that banks have a monumental task to
educate their debit- and credit-card
holders and other customers. Perhaps I
am biased; or perhaps I’m just more
conversant than those surveyed with
the advantages of PAP.
Another facet about studies related
to bank card use bothers me. Many of
the previous marketing studies on the
early introduction of bank credit cards
were widely off their marks concerning
market acceptance, rate of fraudulent
use and perception of the probability
of politically restrictive legislation
(which, interestingly, wound up accom
plishing the exact opposite of that
which its sponsors had indicated they
intended it to do).
Now is the time for banks to educate
customers—in a low-keyed manner—to
the implications, advantages and dis
advantages of PAP.
The other side of the coin is the cash
management opportunities PAP offers
to business firms receiving periodic pay
ments. In this area, PAP is equally in
need of support by way of education,
study and cooperative surveys to get a
better fix on this sector, in which banks
and their commercial customers have a
tremendous stake.
Santayana noted that those who
haven’t learned from the past are
doomed to repeat its errors. PAP is too
important to bankers to be left for
others to run with while bankers fight
among themselves.
Bankers, PAP is not soft food for
babies!
Perhaps we should subject ourselves,
as do prudent women, to a periodic
“PAP” test to determine whether or not
the time is right for banks and their cus
tomers to phase in pre-authorizations of
payments and the cash management
concepts that PAP generates. • *

•

Index to Advertisers

Aetna Business Credit ................................ 13
American Bank Directory .......................... 108
American National Bank, St. Louis ......... 91
Atlantic Envelope Co...................................... 19
Bank Board Letter .................................. 71, 112
Bank Building Corp......................................... 10
Bank of Belleville ......................................... 110
Bank of New Orleans .......
67
Bank of Oklahoma ......................................... 102
Bank of the Southwest, Houston ............. 109
Barclay, The .................................................... 100
Blender Co., Howard J.................................... 38
Boatmen’s National Bank, St. Louis ......... 33
Bradford .............................................................. 18
Brentwood (Mo.) Bank .................................... 91
Central Trust Bank, Jefferson City, Mo. .. 82
Christmas Club—A Corporation ................. 38
Citizens Bank, Grant City, Mo..................... 90
City Bank, St. Louis ...................................... 91
Commerce Bank, Kansas City ..................... 87
Commercial Nat’l Bank, Kansas City, Kan. 95
Corporate Personnel ..................................... 56
Country Press, Inc........................................... 14
Douglas Guardian Warehouse Corp............. 47
Downey Co., C. L.............................................
4
Dress-A-Doll & Design-A-Toy ....................... 15
Farmers Grain & Livestock Hedging Corp. 16
Fidelity Bank, Oklahoma City ..................... 105
Financial Placements .................................... 113
First American Nat’l Bank, Nashville .. . 58-59
First Boston Corp. .......................................... 77
First City National Bank, Houston ............. 61
First Missouri Development Finance Corp. 89
First National Bank, Chicago ....................... 81
First National Bank, Hutchinson, Kan. .. 92
First National Bank, Kansas City ............. 17
First National Bank, St. Charles, Mo................. 90
First National Bank, St. Joseph, Mo......... 86
First National Bank, St. Louis . ............. 116
First National Bank. Wichita
................. 99
First Nat’l Bank & Tr. Co., Alton, III......... 80
First Nat’l Bank & Tr. Co., Joplin, Mo. .. 89
First National Bank of Commerce,
New Orleans ................................................. 65
Florissant (Mo.) Bank ................................ 91
Fourth National Bank. Tulsa ..................... 31
Fourth Nat’l Bank & Tr. Co.. Wichita . . . 53
Frost National Bank, San Antonio ............. 107
Globe Life & Accident Insurance Co......... 35
Harland Co.. John H...................................... 45
Harrow Smith Co. ......................................... 110
Hattier, Sanford & Reynoir ........................ 69
Heller & Co.. Walter E................................ 22-23
Hibbard, O’Connor & Weeks, Inc............... 34
Hutchinson Nat’l Bank & Tr. Co................. 98
Illinois Bank Building Corp........................... 32
Industrial Life Insurance Co........................ 108
Insurance Enterprises, Inc............................ 41
Lake Shore Markers ..................................... 11
Liberty Nat’l Bank & Tr. Co., Louisville ..
5
Liberty Nat’l Bank & Tr. Co.,
Oklahoma City .............................................
2
MGIC—D & O Insurance ..............................
3
MGIC— Indemnity Corp.................................... 21
MPA Systems . ...
108
Manufacturers Hanover Trust Co............... 24
Marty Co., J. L. .
.......................... 89
Mercantile Bank, St. Louis ........................
7
Missouri Envelope Co..................................... 32
National Stock Yards National Bank . . . . 115
North Park Inn ............................................. 104
Northwestern Banker ................................... I l l
Olan Mills ........................................................ 73
Palumbo & Co., Inc., George ..................... 108
Perry, Adams & Lewis Securities, Inc......... 55
Plus Group ...................................................... 43
Rand McNally & Co........................................ 20
Republic National Bank, Dallas ................. 57
Ridgeway & Assoc., John W.......................... 89
SLT Warehouse Co........................................... 51
St. Johns (Mo.) Bank & Trust Co............... 88
St. Louis County National Bank ............... 85
St. Mary Bank & Tr. Co., Franklin, La. .. 69
Scarborough & Co........................................... 37
Security National Bank, Kansas City, Kan. 97
Security State Bank, Great Bend, Kan. .. 96
South Side National Bank, St. Louis ....... 84
Southern Commercial Bank, St. Louis . . . . 91
Southwest National Bank, Wichita ......... 94
Springfield (III.) Marine Bank ................... 78
Stifel, Nicolaus & Co., Inc............................ 101
Tri-Continental Leasing ................................ 39
Union Bank, East St. Louis ........................ 80
United Missouri Bank, Kansas City .........
9
U S Life Credit Life Insurance Co............. 11
van Wagenen Co., G. D.................................
56
Whitney National Bank, New Orleans . . . . 63
Zahner & Co..................................................... 46

MID-CONTINENT BANKER for May 1, 1977

https://fraser.stlouisfed.org
Federal Reserve Bank of St. Louis

On the job. Wherever they’re needed. Some will meet
you and greet you at your convention. Several will be
calling on banks in their ;territories. But others— with
authority to make decisions— will be back at the bank
ready to serve you r staff with j ust a cal I; to 618-2 71-6633.

How our bank can help your bank
grow with your farmers and ranchers.
The world’s appetite for food and fiber is getting bigger
all the time. So today’s demands for agricultural financing
may be more than you can handle with available funds.
First National Bank in St. Louis is ready to help
you and your customers.
With funds for operating and production loans,
machinery and equipment loans. With leasing
plans and exporting assistance.
Even investment and estate planning
to help them conserve their assets.
¿ ft*
You’ll find us easy to work with, and w
we’re staffed to respond quickly. Our
Agricultural Department is headed by
Neil Bergenthal, Vice-President, who
has 20 years of farm credit experience
in agribusiness and the U.S. Farm
Credit Administration.
Call Neil at (314) 342-6695. And
send for our new brochure, “The
Changed Nature of Agricultural
Financing.”
And grow with your farmers
and ranchers.

First National Bank
in St. Louis Wfc
HI Hi
Member FDIC

510 Locust, St. Louis, Mo. 63101

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Federal Reserve Bank of St. Louis

Full text of Mid-Continent Banker : The Financial Magazine of the Mississippi Valley and Southwest : May 1, 1977, Volume 73, No. 5

FRASER