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(ISSN 002Ó-29ÓX) INCORPORATING MID-WESTERN BANKER SEPTEMBER, 1983 NORTHERN EDITION W illiam H. Kennedy Jr ABA President https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C. Robert Brenton ABA President-Elect CUSTOMIZED https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis YOUR data processing system should reflect YOU IT CAN YOUR BANK WE CAN YOUR CO M M UNITY YOU CAN The Total Bank System, an interactive real time system CUSTOMIZED FOR YOU First Total Systems In c Data Processing for the Financial Industry 1650 So. C olorado Blvd. • Denver, C o lo ra do 80222 • 303 753-0295 R emodeling F or R esults Successful remodeling takes more than just a “face lift! It is usually more demanding than new construction. Fitting a new design to an existing financial structure demands highly specialized skills in architectural design and space and function planning. It requires the ability to anticipate problems unique to your building. 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Richardson, Texas 75080 (214)934-5816 San Diego: 1347 Tavern Road Suite 8 Alpine, California 92001 (619) 445-6266 Convention Calendar MID-CONTINENT RANKER (Incorporating MID-WESTERN BANKER) Sept. 20-23: ABA National Bank Card Convention, Los Angeles, Bonaventure. Sept. 25-29: Consumer Bankers Association Annual Conference, Scottsdale, Ariz., Camelback Inn. Sept. 28-30: D ealer Bank Association Senior FundsManagement Boundtable, Boston. O ct. 2-8: ABA Management School for Corporate Bank ers, Evanston, 111., Northwestern University. O ct. 8-12: ABA Annual Convention, Honolulu, Hawaii. O ct. 9-15: ABA National Graduate Compliance School, Norman, Okla., University of Oklahoma. Oct. 10-12: Independent Bankers Association of Amer ica Advanced Commodity Marketing Seminar, Chi cago. O ct. 16-19: Bank Administration Institute Cash Man agement Conference, Boston, W estin Hotel. O ct. 19-21: D ealer Bank Association Operations Sem i nar, New York City, Vista International. O ct. 2 1 -2 2 : E q u ip m e n t-L e a s e Sem in ar, A tlanta, Peachtree Plaza. O ct. 23-25: ABA International Banking Conference, New York City, Grand Hyatt New York. O ct. 23-26: Bank Marketing Association Annual Con vention, Atlanta, Atlanta Hilton. O ct. 23-28: ABA National Commercial Lending Gradu ate School, Norman, Okla., University of Oklahoma. O ct. 30-Nov. 2: Robert Morris Associates Annual Fall Conference, San Francisco, Fairm ont Hotel. O ct. 31-Nov. 2: Conference of State Bank Supervisors, Federal Legislative C onference, Washington, D .C ., Mayflower Hotel. Nov. 2-5: Independent Bankers Association of Amer ica, Seminar/Workshop on One-Bank Holding Com pany, Hilton Head Island, S. C ., Hilton Head R e sort. Nov. 6-18: ABA National Commercial Lending School, Norman, Okla., University of Oklahoma. Nov. 9-11: Association o fBank Holding Companies Fall M eeting, Seattle, W estin Hotel. Nov. 9-11: D ealer Bank Association Public Finance Seminar, New Orleans. Nov. 13-16: ABA National Agricultural Bankers Con ference, Los Angeles, Bonaventure. Nov. 13-16: Bank A dm inistration Institu te Money Transfer Developments C onference, Boston, W estin Hotel. Nov. 13-16: Bank M arketing Association Corporate Business Developm ent Training Workshop, Orlan do, Fla., Orlando Marriott Inn. Nov. 13-17: Bank Marketing Association Trust M arket ing Conference, Dallas, Fairm ont Hotel. Nov. 27-D ec. 2: ABA National Commercial Lending G raduate School, N orman, O k la., U niversity of Oklahoma. D ec. 5-9: Bank Marketing Association Southeastern Essentials o fB a n k Marketing School, Athens, G a ., University of Georgia. D ec. 11-14: Bank Administration Institu te ATM/6National C onference, Atlanta, Hilton Hotel. Jan . 15-18: Bank Administration Institute PATH Con feren ce on Productivity, New Orleans, Sheraton Hotel. Jan. 20-21: Equipm ent-Lease Seminar, New Orleans, Marriott Hotel. Jan. 31-Feb. 3: ABA Insurance & Protection National Conference, San Francisco, Hyatt Regency Hotel. • A guide and supplement for evaluat ing the effectiveness of savings institu tions’ internal controls have been pub lished by Ernst & Whinney, interna tional accounting firm. Evaluating In ternal C ontrol — Savings Institutions: A Guide f o r M anagem ent an d D irec tors and Evaluating In tern al C ontrol — Savings Institutions: D ocum enta tion S u p p lem en t provide question naires, work papers, flow-charting in structions and forms for documenta tion and evaluation. They can be obtained from any Ernst & Whinney office. Volume 79, No. 9 IN THIS ISSUE 13 ABA CONVENTION PROGRAM Parade of speakers includes Ford , V olcker, W riston 18 ABA PRESIDENT RECAPS YEAR IN OFFICE W ithholding victory heads list o f accom plishm ents 24 LOAN-REVIEW COMMITTEE BENEFITS REPORTED A follow-up rep ort on this vital topic Financial Buyers Guide (BG /l-B G /24) BG/3 BG/4 BG/8 BG/16 CARNEGIE COURSES MOTIVATE BANK'S STAFF KEYS TO MEETING NONBANK COMPETITION HOW TO SEARCH FOR PERFECT PREMIUM VOLUNTEER WORK ENCOURAGED BY BANK 33 NEWS ABOUT BANKS/BANKERS M ergers, prom otions, reassignm ents reported 40 KEY TO COMMUNITY BANK SURVIVAL I t ’s adjustability, BA I survey shows 44 COMPETITION AFFECTS LIABILITY PRICING Causing som e banks to take risks 48 INVESTMENT COUNSELOR ASSISTS UP-SCALE RETIREES Service helps bank keep custom ers 52 SERVING THE NEW CUSTOMER A m arketing/comm unications p erspective MID-CONTINENT BANKER STAFF Ralph B. Cox, Publisher Lawrence W. Colbert, Vice President, Advertising Rosemary McKelvey, Editor Jim Fabian, Senior John L. Cleveland, Assistant to the Publisher Editor M ID -C O N T IN E N T BANKER E d ito rial/A d ve rtisin g Offices St. Louis, Mo., 408 Olive, 63102. Tel. 314/4215445; Ralph B. Cox, Publisher; Marge Bottiaux, Advertising Production Mgr. MID-CONTINENT BANKER is published monthly by Commerce Publishing Co., 408 Olive St., St. Louis, Mo. 63102. Printed by The Ovid Bell Press, Inc., Fulton, Mo. Controlled circulation postage paid at St. Louis, Mo., and at additional mailing offices. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis September, 1983 Subscription rates: Three years $27; two years $20; one year $12. Single copies, $2.50 each. Foreign subscriptions, 50% additional. Commerce Publications: American Agent & Bro ker, Club Management, Decor, Life Insurance Selling, Mid-Continent Banker and The Bank Board Letter. Officers: Donald H. Clark, chairman emeritus, Wesley H. Clark, president and chief executive officer; James T. Poor, executive vice president and secretary; Ralph B. Cox, first vice president and treasurer; Bernard A. Beggan, David A. Baetz, Lawrence W. Colbert and William M. Humberg, vice presidents. 5 The disadvantages of dealing with money markets, 6 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for September, 1983 Member FDIC © Bankers Trust Company. elim inated. Bankers Trust NoteLine: the stream top terminal or other communications options. You can transmit your issuing lined way to deal with money markets. instructions to our New York office instantly. Using existing forms of communica As your agents, we issue your CD, tion to deal with money markets leaves a draft or note on your behalf, mail you a lot of room for error. In today’s volatile, time sensitive markets, you need to have copy, arrange for physical delivery and track the instruments for you. As trans quick, comprehensive control of all aspects of your portfolio management, lo actions are entered, NoteLine monitors cally and nationally. That’s why Bankers and notifies you of input errors auto matically. You get a confirmation from Trust developed NoteLine—the fastest, us accepting total responsibility for most reliable way ever to utilize the issuance and delivery according to your money markets for your acceptances, CDs instructions. and commercial paper. With NoteLine you can stay con Bankers Trust NoteLine is a simple, stantly abreast of activity, outstandings automated program, which uses a desk MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis and interest expense. NoteLine is the only system that gives you a consolidated report on your positions. Or, this infor mation can be segregated by type of issue. Contact us today. Once you see how easy Bankers Trust NoteLine makes dealing with money markets, you’ll look forward to dealing with Bankers Trust. BankersTrust Company 280 Park Avenue, New York, N.Y. 10017 7 THE BANKING SCENE By Dr. LEWIS E. DAVIDS Illinois Bankers Professor of Bank Management Southern Illinois University, Carbondale T h e R ap id G ro w th o f A T M N e tw o rk s A u t o m a t ic te lle r m achines l (ATMs), introduced by New E n gland banks in 1969, had increased in number to 29,000 by the end of last year. A third were less than a year old. Those 29,000 ATMs in operation represent an average of two per U. S. bank, but, of course, ATM usage is concentrated at larger banks. New York’s Citicorp has several hundred. Particularly in smaller communi ties, ATMs installed thus far frequent ly have not had on-line capabilities, but there has been an exponential growth in ATM networking within the Commercial banks typically have had substantial limits on the number and location of their ATMs, while thrifts have not been so limited. last year or so. Today, there are at least 150 regional ATM networks — some with hundreds of machines tied into their systems — and seven national networks are expected to be operation al by the end of 1983. Outdated legislation admittedly has limited the growth of ATM networks in some parts of the nation, but the situa tion is changing rapidly. Nor are finan cial institutions the only agents of change. R etailers and travel-andentertainment companies have been quite active in prom oting ATM growth. The change in consumer attitudes toward credit and debit cards and ATMs has been dramatic. Most early marketing studies regarding credit cards were pessimistic that consumers would ever adapt to conducting busi ness via plastic cards. One study of a group of consumers who were sent un solicited credit cards showed that a siz able percentage did not intend to use them. A follow-up study a few months later, however, showed that many who 8 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis had initially said they would not use the cards had done so. Sim ilarly, ATM acceptan ce has been surprisingly rapid. As late as 1976, only 6.6% of the respondents in one survey said they had ever used an ATM. That percentage had shifted to 33% by the time a similar survey was conducted last November. Moreover, the demographic profile of the typical ATM user indicates that he/she tends to be younger, better educated and more affluent than the non-user. The legislative outlook regarding ATMs still is clouded, however. Amer ican Express has been allowed to in stall ATMs in major airports and other high-traffic areas around the nation. The savings and loan industry has not been handicapped by restrictive leg islation and theoretically thrifts could place ATMs anywhere. Commercial banks, on the other hand, typically have had substantial limitations on the number and locations of the ATMs they operate. A paradox exists. Although S&Ls have had more flexibility in installing ATMs, they have not used their advan tage effectively. This probably is due to the extremely poor earnings picture S&Ls have faced until recently and their need to focus on retrenchment rather than expansion. With the de cline in interest rates and substantial cash inflows to super NOW accounts, many S&Ls are reconsidering their attitudes toward ATMs. Whereas S&Ls want the ATM sys tems they join to be capable of han dling all of the different types of trans actions an ATM network can potential ly handle, some state banking associa tions have said they would not support permitting deposit and loan payments through ATMs. There probably are rational political reasons for taking such a stance. In fact, the board of one major state bankers association recent ly took a stand on restricting converted S&Ls to operating no more than the number of offices authorized under the state banking act. If the legislation supported by bank ers were to pass, however, an S&L could still convert to a federal thrift charter — as permitted under the Garn-St Germain legislation of 1982 — and bypass the conversion restriction. Examining history sometimes helps to put recent developments into per spective. Recall that in the 1950s when credit cards were just being adopted, the first step was non-shared cards issued by individual banks. Later, the cards issued by individual banks were "The number of ATM trans actions is expected to jump from 1.5 billion in 1981 to seven billion by 1985, accord ing to one study." consolidated into regional systems which, in turn, joined BankAmericard — now Visa — or MasterCard. Subse quently, banks were permitted to join both national systems and many did so. During the interest-rate peaks of the 1970s and the accompanying cost pressures on credit-card issuers, the cost of many services which previously had been offered to consumers for free were passed along. As a result, many bank customers who had carried both Visa and MasterCard decided they could get along with just one card. Doubts about the potential use con sumers would have for a nationwide ATM network have, in a similar man ner, cast doubts on the long-term potential of national networks. Oppo nents rightly have pointed out that much of the American population isn’t extremely mobile and would have lit tle use for an ATM system more than a short distance from home or office. An equally valid argument holds that the segment of the population that travels extensively either for business or plea- MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis !; Visa Travelers Cheques will be the second | V largest selling travelers cheque V** ® worldwide this year, with sales reaching ’ $7 billion. Issued in nine major currencies and sold in 156 countries, they are backed by a 24-hour refund service and other emergency services. Visa Travelers Cheques also carry the most accepted, most widely used name in the world for travel, entertainment, shopping, and cash. Prove it to yourself. Find out how you can sell the fastest growing travelers cheque in the world. Call Tom Gallagher or Jim Ryan at Visa. (415) 570-3628. You can do it. We'd like to help. sure is sufficient to guarantee the suc cess of national ATM networks. Regardless of which assessment ulti mately proves accurate, projections on the number of ATM transactions indi cate that we probably will continue to HAT MAY B E the most vigorous grass-roots effort in U.S. his see tremendous growth in ATMs put tory on the part of the citizenry to express its will to the federal in place over the next few years. The legislature ran its course with the signing of the withholding repeal bill number of ATM transactions is ex by President Reagan last month. pected to jump from 1.5 billion in 1981 The final weeks of the effort appeared to be toueh-and-go, with to seven billion by 1985, according to financial institutions poised on the brink of a precipice, not knowing one study. Checks still are the pre whether Congress would settle its differences in time to avoid missing ferred transaction medium, according the August 5th deadline set by the Treasury Department for the imple to the study, but ATM-transaction mentation of withholding. volume is growing at a much faster rate By wide margins of 392-18 in the House and 90-7 in the Senate, than check-transaction volume. Given legislators stamped their final approval on the compromised version of the dramatic increase in home compu H. R. 2973 as drafted by a House/Senate conference committee. The ters which can, with relative ease, ac votes reaffirmed congressional endorsement of repeal, which earlier cess ATMs, the seven-billion-transhad passed the House by 382-41 and the Senate by 86-4. actions estimate for 1985 may be on the The conference-committee agreement repeals the 1982 law and low side. strengthens taxpayer compliance. Under the committee’s final version, From a bank’s perspective, ATMs all payors of interest and dividends must (1) file 1099 forms with the offer overwhelming advantages. A Internal Revenue Service on machine-readable media beginning in single ATM typically is priced at be 1985 (there is a provision for a hardship exemption); (2) mail separate tween $20,000 and $40,000, depend standard 1099 forms to account holders and (3) have a separate mailing ing on the sophistication of the system. this year to check account holders’ taxpayer-identification numbers. When one compares that cost with sal The rate of backup withholding has been increased to 20% and backup ary and fringes of a human teller, not to withholding applies to taxpayers who underreport interest and dividend mention the around-the-clock availa income. Once commenced, backup withholding generally continues bility of the ATM, it’s easy to see why until the end of the calendar year in which the taxpayer corrects. more bankers are concluding that they Where the correction is made after October 15th, backup withhold must get ATMs with on-line capability ing will not terminate until the end of the calendar year following the in place. correction. A banker considering such a move The minimum notice period by the IRS is 120 days and at least four will not have to analyze all of the more notices are required during that period. Payors are accorded 30 days to than 150 regional networks operating commence backup withholding after notice to do so is received from the before deciding on the one best suited IRS. for his bank. The search can be con In general, the requirement that payors obtain sworn certificates fined to those networks operating in from payees as to their taxpayer-identification numbers and whether the region where the bank has branch they are subject to backup withholding apply only to accounts and es. But any search for an appropriate brokerage relationships opened after Decem ber 31, 1983. ATM network should be conducted in Liability equal to the amount required to be withheld will be imposed a rational and systematic manner. • • on payors who fail to backup withhold. The Treasury has been granted regulatory authority to permit payors not to withhold on interest or dividend payments that don’t exceed $10 annually. Seminars on Letters of Credit Penalties for failure to file information returns and to include correct Scheduled in Two Cities taxpayer-identification numbers are self-assessed and the maximum dollar limitations on such penalties have been deleted. The “reasonableSeminars on the use of commercial cause defense to both penalties has been replaced by a stricter “dueletters of credit and bankers accept diligence” defense. A due-diligence defense to the penalty for failure to ance will be offered this fall by the report a correct taxpayer-identification number is established by show School of International Finance. ing reliance on a payee’s certificate, in the case of accounts opened after Instructors will be vice presidents of next December 31, or by making annual requests for a correct taxpayermajor international banks who have identification number in the case of accounts opened prior to next been involved in managing letters-ofJanuary 1. credit departments for at least 10 years. Failure to report interest or dividend income reported by financial Chicago will be the site of two semi institutions to the IRS is presumptive of negligence. Taxpayers filing nars: one Septem ber 20-21 at the false certificates as to taxpayer-identification numbers or the applicabil ity of backup withholding are subject to $500 fines. Drake Hotel and the other November 1-2 at the Executive House. The New Financial institutions filing 50 returns or more annually after 1984 are York Sheraton is the location of an required to file interest and dividend information returns with the IRS October 11-13 seminar in New York on magnetic tape, but there is a hardship provision. City. Information returns furnished to payees are to be mailed under A brochure may be obtained by call separate cover and in official form, along with a notice that amounts ing 800-631-3098. reported are taxable and must be reported to the IRS. Backup withholding applies to amounts paid or credited after next December 31. Reagan Signs Withholding Repeal; Backup Withholding Begins in '84 W 10 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for September, 1983 Forget about losses when your Home Improvement Loans are protected by Insured Credit Services. Without question, losses are a major threat to your loan portfolio today. Even the best lender can incur a loss when a stable borrower suddenly becomes a victim of unemployment, divorce, disablement, or bankruptcy. Now, you can shelter your home improvement loans from all risks with the Insured Credit Services Loan Profit Program. Any loan that is deemed uncollectable is guaranteed to give you maximum yield. We’ll quickly and completely reimburse you for the unpaid principal plus interest and costs. In addition, we offer 28 years of underwriting and marketing expertise to assist in the evaluation and development of your home improvement loan portfolio. Insured Credit Services, Inc. is a wholly owned subsidiary of Old Republic International Corporation, the nation’s largest provider of consumer credit insurance coverages. If you want to forget about the threat of loss on home improvement lending and feel more secure about aggres sively pursuing this profitable market, please contact: William F. Schumann, President, Insured Credit Services, Inc.; 307 North Michigan Avenue; Chicago, Illinois 60601; (312) 621-9400. IN S U R E D C R E D IT S E R V IC E S / The <)rn>mal H om e E q u ity a n d H om e Im p ro v e m e n t L o an P rote ction Specialists. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 11 Renaissance Center, Detroit Why does a bank 20 miles from Detroit have its data processing done in Pittsburgh? "With Mellon Bank we went immediately to a system that was up to date— and stays up to date? Harold W. A llm acher Jr. Harold A llm acher is president of the F irs t N ational B an k in Mount Clem ens, one of nearly 2 0 0 banks in 16 states th a t use Mellon’s D atacen ter Services. "We were willing to pay a little more for Mellon’s Remote Job E n try system s because of the pay off,” says A llm ach er "The payoff has been fast start-u p , little or no https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis @ downtime, and a system th a t’s constantly updated to stay on top of changes in the industry. Others promise. Mellon delivers.” and competitive advantage in today’s demanding, rapidly changing financial services environm ent. Mellon w as one of the first banks to apply electronic system s to banking, in 1955, and we’ve been in the forefront of development ever since. A staff of m ore than 5 0 0 bankers who are data-processing professionals, supported by an annual development budget in excess of $ 4 0 million, ensures th at com m itm ent. Mellon’s D atacenter shares in those resources, giving its custom ers a distinct financial If you’re concerned about m ain taining cost-effectiveness while providing the new services th at staying competitive demands, compare your processing costs and capabilities with those provided by Mellon’s D atacen ter J u s t call Dick Meyer, vice presi dent, (412) 234-4861. Or write to him a t Mellon B ank, D atacenter Division, One Mellon B ank Center, Pittsburgh, PA 15258. Mellon Bank Bankers helping bankers compete. Parade of Speakers Engaged For ABA's H aw aiian Convention Former Pres. Ford, Fed's Volcker, Citicorp's Wriston Fiead List O RM ER U. S. President Gerald R. Ford, Fed eral Reserve Board C hairm an Paul V olcker, C iticorp Chairm an W alter B. W riston and Nobel Economist Milton Friedman will be featured speakers when the 1983 ABA convention convenes in Honolulu, October 8-12. Bankers are expected to jam the meeting rooms — not the beaches — for sessions on such vital topics as pric ing bank services, credit-risk manage ment, nonperforming loan disclosure and liquidity m anagem ent. “ No where, but at the ABA convention do bankers have such an excellent oppor tunity to exchange ideas and share in formation and experiences with their friends, business colleagues and lead ers in the financial and government arenas,” stated ABA President W il liam H. Kennedy Jr., chairman/CEO, National Bank of Com m erce, Pine Bluff, Ark. The island of Oahu will live up to its nickname, “the gathering place,” be ginning Friday, October 7, when reg istration opens at the Sheraton Waiki ki. Then the grand-opening ceremony, complete with Hawaiian entertain ment, will be held Saturday morning at the Hilton Hawaiian Village. This 20-acre complex also will be the site of the exhibit center for the con vention. More than 80 companies will display the newest hardware, soft ware, signs, premiums, employee uni forms, publications and other equip ment and supplies that the industry needs. Saturday morning’s agenda also will include concurrent sessions on Fed pricing, credit risk and disinflation, new technology for delivering con sumer services, the outlook for agri cultural banking and other timely sub jects. Workshops and special-interest sessions throughout the convention will be centered primarily in the Hil ton Hawaiian Village, with some held at the Sheraton Waikiki. Serving as the foundation for the afternoon’s program will be C om - F petitech, ABA’s monthly publication series analyzing techniques and tech nology that bankers need to know to compete in a deregulated environ ment. Among the C om petitech topics to be featured are increasing personnel productivity, taking advantage of the secondary-mortgage market and con trolling bankruptcy losses. The ABA fellowship gathering on Sunday (plus Monday’s and Tuesday’s general sessions) will be conducted in the dome-covered Arena at the Neal Blaisdell C en ter, which has been called “one of the finest examples of contemporary civic architecture in the country.” To be featured at the fel lowship gathering will be Hawaiian minister Rev. Abraham K. Akaka, who appeared at the 1978 ABA convention in Hawaii. Also performing will be the Hawaiian Symphony Orchestra and two Honolulu church choirs. Next on the program will be an open meeting of the ABA’s government re lations council, with House banking committee members Doug Barnard (D.-Ga.), Norman E. D ’Amours (D.N. H.), Stephen L. Neal (D.-N. C.) and Chalmers P. Wylie (R.-Ohio) and Senate banking committee member Alan J. Dixon (D .-111.). This was a heavily attended convention event last year in Atlanta. A series of banking workshops will be held that will focus on international banking opportunities, executiveincentive com pensation, potential new lines of business and credit-card fraud. Monday morning’s general session MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis will include addresses by U. S. Sen. Daniel K. Inouye (D.-Hawaii), ABA President William H. Kennedy Jr., Citicorp Chairman Walter B. Wriston, Federal Reserve Board Chairman Paul Volcker and Institute of International F in an ce M anaging D ire cto r-D e s ignate Andre de Fattre, currently a special representative of the World Bank. In the afternoon, Comptroller of the Currency C. Todd Conover and FD IC Chairman William M. Isaac will par ticipate in a discussion of banking de regulation and agency reorganization. This panel will be immediately fol lowed by three concurrent sessions with senior officials from the FD IC , Federal Reserve Board and the Office of the Comptroller of the Currency. Agency participants will be: Office of the Comptroller of the Currency — Brian Smith, chief counsel, H. Joe Sel by, senior deputy comptroller, opera tions, Doyle Arnold, senior deputy com p troller for policy/planning, M ichael M ancusi, senior deputy comptroller/national operations, Jim Boland, deputy comptroller/industry and public affairs; FD IC — Thomas Brooks, general counsel, James Sex ton, director, division of banking su pervision, Stanley C. Silverberg, d irector, division of research and strategic planning, and Margaret F. Egginton, deputy to the chairman; Federal Reserve Board — Michael Bradfield, general counsel, John E. Ryan, director, division of bank supervision/regulation, and Griffith F. Gar wood, deputy director, division of consumer/community affairs. Highlights of Tuesday’s general ses sion will be the election and installa tion of new ABA officers and addresses by Gerald Ford, Milton Friedman and ABA Executive Vice President Willis W. Alexander. Micro-computers, one of the most popular convention subjects last year, will be revisited on Tuesday afternoon. Attendees will learn how to evaluate and select a micro and how to use mi- 13 Convention Speakers at General Sessions CLYDE JORDAN JONES Daily Convention Schedule Friday, October 7 10:00 a.m. — Registration begins. Saturday, October 8 8:30 a.m. — Grand opening ceremonies. 9:00 a.m. — Exhibits, activity center, convention central open. 10:30 a.m. — Special-interest sessions and government-relations fea ture sessions. 1:30 p.m. — C om petitech sessions and special-stress series. 3:30 p.m. — Exhibits, activity center and convention central close. Sunday, October 9 9:00 a.m. — Fellowship program; exhibits, activity center and con vention central open. 10:30 a.m. — Governm ent-relations council m eeting and specialinterest sessions. 1:30 p.m. — Special stress series. 3:00 p.m. — Exhibits, activity center and convention central close. 6:00 p.m. — ABA reception “Hawaiian Rainbows.” Monday, October 10 7:30 a.m. — Special-interest sessions; exhibits, activity center and convention central open. 8:25 a.m. — Pre-session entertainment. 9:00 a.m. — General session. 1:30 p.m. — Government-relations feature session and special-stress series. 2:45 p.m. — Government relations dialogue with regulators. 3:30 p.m. — Exhibits, activity center and convention central close. Tuesday, October 11 7:30 a.m. — Special-interest sessions; exhibits, activity center and convention central open. 8:25 a.m. — Pre-session entertainment. 9:00 a.m. — General session. 1:30 p.m. — Micro-computer session; special-stress series. 2:15 p.m. — Micro-computer breakout sessions. 3:45 p.m. — Exhibit grand prizes. 4:00 p.m. — Exhibits, activity center and convention central close. 6:00 p.m. — ABA reception “Polynesian Nights.” Wednesday, October 12 8:30 a.m. — Economic outlook feature session. 10:30a.m . — Convention closes. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis PARRY cros to save time and money. On both Monday and Tuesday mornings early-bird sessions will be gin at 7:30 a.m. Subjects to be pre sented include variable-rate lending, strategic planning, sm all-business financing, utilizing bank service cor porations and new-product develop ment. Planned for Wednesday is a panel of some of the nation’s leading econo mists: David M. Jones, senior vice president/economist, Aubrey Lanston & Co., New York City; Jerry Jordan, former Reagan economic advisor and professor, Anderson Schools of Man agement, University of New Mexico, Albuquerque; and Robert T. Parry, chairman of the ABA s economic advi sory committee and executive vice president/chief economist, Security Pacific National, Los Angeles. Larry F. Clyde, chairman, ABA bank invest ments and funds management division and executive vice president, Crocker National, San Francisco, will serve as moderator. This year’s ABA receptions — a con vention tradition — will be held at the Hilton Hawaiian Village on Sunday evening and at the Sheraton Waikiki and Royal Hawaiian on Tuesday. For spouses, a series of programs on managing stress will be presented by clinical psychologist and syndicated columnist William D. Brown. Transportation between ABA con vention hotels and all ABA functions will be via one of the most extensive, modern, air-conditioned shuttle-bus systems ever engaged for a meeting of thi s size. It will be complimentary. MID-CONTINENT BANKER for September, 1983 “No one should be fooled by this year’s idyllic setting,’’ according to ABA President Kennedy. “This will be a no-nonsense, nuts-and-bolts conven tion from which attendees will benefit for years to com e.” • • President-Elect Candidate James G. Cairns Jr. is official candidate for ABA pres.-elect for 1983-'84. He is pres., Peoples Nat'l of Washington, Se attle. He joined that bank in 1962 and has been pres, since 1 9 7 9 . M r. C airns was selected as the ABA's official candi date last spring. His ca n d id a cy w as opposed by Charles W. McCoy, ch./CEO, Louisiana Nat'l, Baton Rouge. Special-Interest Sessions On Convention Agenda Numerous special-interest sessions are scheduled for four of the five days of the ABA convention in Honolulu. On Saturday, October 8, and Sunday, October 9, they will start at 10:30 a.m .; on Monday and Tuesday, October 10 and 11, they will begin at 7:30 a.m. Sessions set for Saturday will in clude credit risk and disinflation; agri cultural-banking outlook; consumergap management; the technological explosion: consumer delivery alterna tives; and in-home banking for the community bank. Sunday’s sessions will include chal lenging the nonbank competition; the great credit-card rip-off; executiveincentive compensation; international banking opportunities; and a series of new business-opportunity sessions on real-estate equity participations, dis count brokerages and insurance agen cies. On Monday topics to be addressed will include risk-m anagem ent; re sponding to the deregulated com munication industry; loan disclosure and the m edia; new -product de velopment; working with directors; variable-rate lending; and asset/liability management. Tuesday’s topics will include kidnap/hostage; sales force management; loan workouts; planning; bank service corporations vs. H Cs; challenging competitors in the upscale market; managing the information overload; and incentive compensation for bank personnel. Government-Relations Sessions Continuing Convention Topic OVERNM ENT relations will be featured at four special sessions during the ABA convention in Honolulu. The sessions will be held on Saturday, Sunday and Monday (October 8, 9 and 10). The Saturday session is titled “Banks and the Federal Reserve as Competitors in the Payments System.” Among featured panelists will be Doug Barnard Jr. (D.-Ga.), member of the House banking commit tee, and Kenneth A. McLean, minority staff director, Senate banking committee. An open government relations council meeting will be held on Sun day, immediately following the fellowship program. G GARN Featured speaker will be Sen. Jake Garn (R.-Utah), chairman, Senate banking committee. A discussion of legislative and regulatory issues of interest to bankers will be conducted by Mark W. Olson, chairman of the government relations council and president, Security State, Fergus Falls, Minn., and Hugh M. Chapman, vice chairman, government relations council and chairman, C&S National Bank of South Carolina, Columbia. ISAAC CONOVER Gerald M. Lowrie, executive director of the government relations division, will moderate a panel of banking committee members on the topic of legislation. Panelists will include Stephen L. Neal (D.-N. C.), Chalmers P. Wylie (R.-Ohio), Doug Barnard Jr. (D.-Ga.) and Norman E. D ’Amours (D.-N. H.) from the House banking committee, and Alan J. Dixon (D.-Ill.) from the Senate banking committee. The first government-relations feature session on Monday will spot light federal regulatory perspectives and will be introduced by ABA President William H. Kennedy Jr., chairman, National Bank of Com merce, Pine Bluff, Ark. ABA President-Elect Designate James G. Cairns Jr., will preside. He is chairman of the ABA’s task force on restructuring the federal financial regulatory agencies and president, Peoples Bank of Washington, Seattle. Featured speakers will be William M. Isaac, FD IC chairman, and C. Todd Conover, Comptroller of the Currency. The session will include dialogues with panels of representatives of the Fed, the FD IC and the Comptroller’s office. The final government-relations event (also on Monday) will be a workshop on how federal legislation affects banks, featuring James C. Sivon, chief counsel/minority staff director, House banking committee; Daniel M. Wall, staff director, Senate banking committee; and James C. Healey, assistant to the chairman, House ways and means committee. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis LOWRIE 15 ABA Officers for 1982-'83 JENKINS KENNEDY PIKE W illiam H. K ennedy J r . , ABA president, is chairman/ CEO, National Bank of Commerce, Pine Bluff, Ark. He joined the bank 25 years ago. He was chairman, ABA government relations council, in 1979-’80. C . R obert B renton, ABA president-elect, will step up to president during this year’s convention. He is president, Brenton Banks, Inc., Des Moines, la., and has been a banker since 1958. In 1969, he was elected to his present title at the HC. A lbert R. Pike, ABA treasurer (serving a second term), entered banking in 1939 at Central National, Cleveland. In 1955, he joined the former Lake National, now Bank One ALEXANDER BRENTON of Northeastern Ohio, Painesville, where he serves as chairman. Llewellyn Jen kin s, ABA council chairman and immediate past ABA president, is vice chairman, Manufacturers Hanover Trust, New York City. He joined its predecessor, the old Central Hanover Bank, in 1946, and became vice chairman/director in 1979. Willis A lexander has been ABA executive vice president since 1969. He joined the ABA as a full-time staffer im mediately after serving as ABA president. From 1947-’69, he was with Trenton (Mo.) Trust. He has been the bank’s chairman since 1974. Candidate for ABA Treasurer Candidate for ABA treas. for 1983-'84 is H a rry R. M itig u y , pres./CEO, Howard Bank, B u rling to n, V t. M r. M itig u y joined his bank in 1974 as pres./CEO/ dir. He is a former member of the ex ecutive council of the Vermont Bank ers Association and was chairman of the ABA communications council. ABA Convention Dates Honolulu has been a popular ABA convention city since 1969, when the association first ventured across the Pacific. The convention returned to the Aloha state in 1974 and 1978. Next year’s convention will be held in New York City and the fol lowing year will take it to New Orleans. 16 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Pay Interest on All Demand Accounts, DID C Recommends to Congress ONGRESS has been asked to authorize interest payments on all checking accounts by Treasury Secretary Donald T. Regan, acting as chairman of the Depository Institutions Deregulation Committee (DIDC). Mr. Regan wants Congress to give the D ID C authority to allow interest-rate payments on demand deposits of less than $2,500 at the NOW-account and automated-transfer-account ceiling of 51/4%. He in cluded draft legislation with his proposal. The D ID C ’s members voted to ask Congress to remove statutory prohibitions on interest payments at its meeting last June after it was decided that the committee itself did not have the authority to lift the prohibitions. Mr. Regan said the action was necessary in order to uphold the effectiveness of existing ceilings on passbook savings accounts and on NOW accounts of less than $2,500. He said that, at present, “many transactions balances earn close to a market return, implicitly or explic itly” and therefore cost implications for depository institutions of paying interest on the accounts “would be of a manageable size and largely temporary.” An ABA spokesman disagreed with the secretary and predicted that the banking industry probably would oppose the idea, citing existing upward pressure on bank costs that would be aggravated by the move. The spokesman admitted that the rate ceiling recommended by the DIDC would minimize the likely cost impact of interest payments. Should the measure become law, an adjustment of traditional prac tices regarding business checking accounts would likely occur, resulting in more costs to banks and more fees to customers. Thrifts are expected to support the proposal. C MID-CONTINENT BANKER for September, 1983 AS A DECISION MAKER, HAVE YOU EVER ASKED Are We Making Any Money . . . with these relationships? . . . with these products? . . . in these markets? . . . and, under what conditions? M ore and m ore bankers are asking these questions, only to find that their current systems are not responsive or flexible enough to provide ongoing answers to these questions as conditions change. In today’s environm ent, there is an increasing need to ask these questions regularly, so that profitability and perform ance targets are set and met. B y com bining data from various bank sources, L S C can provide a total picture o f profitability by relationship, product line, market segm ent, and calling officer on a P & L basis and a cost o f funds basis. O ver the past 3 years, L S C has developed a unique product, our A ccount Profitability M odel (A PM )® that can be easily installed by us and maintained by your staff. B y taking on the responsibility for installation, training o f your staff, and the initial analysis o f your data, L S C provides a com plete package o f support and service from installation through an ongoing maintenance program . F o r decision m akers, the need for this product has never been greater. Y o u can be answering these questions regularly in only a few months without a major capital expenditure. I f you would like m ore information on how L S C can help you answer these questions, call or write me directly — John H . Shain, President o f L S C . IM ew ood , Shain & C om pany Chosen fo r Performance 175 Strafford Avenue / Wayne, PA 19087 / Phone (215) 687-5467 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 17 A B A Pres. Kennedy Recaps Y ear in O ffice ITH HOLDING REPEA L was the major achieve # The confrontation we had with Senator Bob Dole ment of the ABA during the term of current ABA • certainly stands out. And, of course, I had a meeting President William H. Kennedy Jr. Mr. Kennedy, who took with the President that also was memorable but not partic over as ABA president last October in Atlanta, took on the ularly pleasing because it was a confrontation and you reins of the ABA just in time to participate vigorously in the never like to do that with the President of the United withholding-repeal effort. States. But as far as a personal highlight, I guess working The Arkansas banker (he’s chairman/CEO, National with the Banking Leadership Conference, which is a group Bank of Commerce, Pine Bluff, Ark.) will complete his of 400-and-some men and women leaders in banking who term as ABA president next month during the ABA con represent a cross section of banking throughout the nation. vention in Honolulu. This group sits down together and takes on the very Following is an interview with Mr. Kennedy. sensitive, tough issues confronting banking and ultimately develops a consensus that is truly representative of the * During your year as the ABA president, what entire industry. • would you consider to be the major achievements of the association? s During your extensive travels on behalf of the • ABA, what challenges did you find uppermost on . Withholding of course. I was delighted with the the minds of the bankers that you met? • results, naturally. But I also was delighted with the attitude of bankers all the way through the repeal cam # Well, in the short-term of course, it was the withpaign. Our repeal-of-withholding campaign showed that • holding issue that was paramount for a great part of when we are together on an issue as we were on this one, the year. The other really overriding issue is the matter of both emotionally and otherwise, we can have political suc deregulation and where we are going to be able to position cess. And if you don’t have that unity and you go to Con the commercial banking industry. gress with a divided mind you are not nearly so successful. * What specifics of deregulation did you keep hearThat, I think, was the primary lesson we learned from the • ing concerns about? withholding issue. We have to be together when we talk to politicians. # The fundamental concern of deregulation is how, In addition to withholding, the ABA has been educating • down the road, commercial banks are going to prof its members about the implications of deregulation in it. The industry is profitable at this particular point in time. preparation for next year. But there is a realization by bankers that there is a squeeze W Q A Q A A Q A Q * Are there any special moments in the past year that • stand out in your memory? on the interest-rate spread as a result of freeing up the liability side of the balance sheet. There is a concern that Mr. Kennedy was no stranger at W hite House during his term as ABA pres. Above, he confers w ith Pres. Reagan and Treas. Sec. Donald Regan about withholding of interest (Mr. Kennedy is fourth from camera on I.). Photo at I. shows Mr. Kennedy leading bankers from W hite House following "confrontation" with Presi dent Reagan. Earlier this year, Mr. Kennedy was ranked among nation's most influential bankers by U. S. News & World Report. (Photo at I. courtesy Washington Post; above photo is official White House photo.) 18 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for September, 1983 Instead of hiring experts of your own ••• ...hire our expertise. First National Bank of Louisville’s Correspondent Consulting Service offers your bank proven programs for much less than the cost of developing them yourself. Our Consulting Services for financial institutions can give you the added specialized strength you need without the financial headaches of staffing and developing programs on your own. Let’s say you’ve identified the need for a Customer Call Program. Working with you, we’ll pinpoint the market, provide needed marketing information, train your staff and create the marketing tools you need. You'll have a total program that’s tailored perfectly to help you take advantage of your bank’s opportunities. Backing your program—whether it’s credit administration, financial planning, personnel administration or marketing management stands the region’s largest and strongest bank. You can be confident that your program will reflect the latest and best thinking in bank expertise. So if you need additional strength in one of these areas, don’t make work for yourself. Make a phone call to Ken Reinhardt, Carolyn Raatz or your Account Officer and find out about First National Consulting Services. In Kentucky call 1-800-292-2272, in contiguous states, 1-800-626-6515. Put it to w ork for you. Member Federal Deposit Insurance Corporation. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Mr. Kennedy has spent a good deal of time testifying before congressional committees on topics relating to financial-institution industry. Here he testifies against attempt by Congress to bail out thrift institutions. we are able to earn money on the asset side. It’s too early to make a determination as to where that ought to be done. Bankers showed real interest in the Arthur Young study done for the ABA which indicated that insurance broker ages and real estate brokerages are two areas which would be appealing to banks of all sizes. But the basic concern is that we are not able to move in any direction because of regulations and we have to be free of that. • Looking back, would you do it all again? # Yes, I would certainly do it again. It has been a great • year for me as well as my wife, Marylena. We en A joyed the experience of meeting so many marvelous people and our industry is just full of that kind of folks. And, of course, traveling to as many places as I have this year has been exciting but it is the people who make it all worth while and the dedication that we all have in enhancing the commercial banking industry. And, also, maybe even more important is making the effort to do things that are right for our country. Being in the ABA has given me the opportun ity to do that and I have enjoyed every minute of it. * * * Reception honoring Mr. Kennedy following his installation as ABA pres, in Atlanta last year was given by Arkansas Bankers Association. Mr. Kennedy (2nd from I.) is greeted by Kenneth P. Wilson (I.), ch./CEO, First Jacksonville (Ark.) Bank. At r. is H. Charles "Bo" Carvill, Ark.BA exec, dir., greeting unidentified well-wisher. 20 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ILLIAM H. KENN EDY JR. is a native of Arkansas. His varied career includes service as an officer in the U. S. Marine Corps with service in World War II and spokesman for the Arkansas Power & Light Co. in the area of economic and industrial development. He joined National Bank of Commerce, Pine Bluff, in 1957 as vice president, was promoted to executive vice president in 1962, president/CEO in 1965 and chairman/ CEO in 1978. He is a past president of the Arkansas Bankers Associa tion and has held numerous other leadership positions in the Ark. BA. He has served the ABA as chairman of the economic education, government relations and legislative commit tees, member of the governing council, vice president for Arkansas and member of the executive committee. Service to the state of Arkansas includes director and president, Arkansas State Chamber of Commerce; director and president, Arkansas Basin Association; member of the board of trustees of the Midwest Research Institute; chair man, Arkansas Waterways Commission; chairman, Arkan sas State Council on Economic Education; and member, Arkansas Industrial Development Commission. • • W One of many duties of ABA pres, is speaking at state banker association conventions. Here, Mr. Kennedy visits with others on program at Michigan Bankers Association convention at Mack inac Island last June. From I.: Barry Asmus, educator/consultant; Leland B. Helms, v.-ch./CEO, Nat'l Bank Wyandotte-Taylor, Mich.; and Mr. Kennedy. MID-CONTINENT BANKER for September, 1983 MORE BULUNG BLOCKS FOR YOUR CUBITS'GROW TH COMMERCIAL CREDIT’S ASSET-BASED LENDING MAXIMIZES THEIR BORROWING POWER. Term and Package Loans Revolving Loans Acquisition Financing Short-term Unsecured Loans Factonng Sustaining your clients’ growth requires capital. Commercial Credit’s asset-based financing can help you pro vide them with the capital they need. Since 1912, Commercial Credit has helped growing businesses raise capital. Capital to build a company’s inventory. Capital to take advantage of supplier discounts. Capital to make acquisitions. What’s more, Commercial Credit Business Loans, Inc. offers uniquely qualified experts in the business financing field and a nationwide distribution network geared spe cifically to the needs of growing companies. So whether your clients are manufac turers, wholesalers, or service companies, call us. We’ll provide the money they need to build their business’ success. For more information, contact us at: (800) 638-1520 In Maryland call 332-3659. Offerings also available through the Control Data Business Centers. COMMERCIAL CREDIT BUSINESS LOANS, INC. a Control Data Company MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis H onolulu Beckons A B A M em bers By Mark S. Serepca, Assistant D irector, ABA Public Relations Division ITH IT S in tricate blend of seum, with exhibits ranging from rare Polynesian charm and cosmo historic Hawaiian artifacts to an ultra politan excitement, Honolulu, site of modern science center and planetar the 1983 ABA convention, is unlike ium; and Iolani Palace, the only royal any other city in the United States. palace under the U. S. flag. Where else can one ride an outrig A stay in Honolulu also should in ger canoe in the afternoon and dance at clude visits to landmarks outside the a glass-floored disco at night? Where city. Highlights of Oahu, the island on else can one visit a modern three which Honolulu is located, include: tiered shopping complex in the after Hanauma Bay, an underwater park; noon and see demonstrations of the the Blow Hole, a geyser in the volcanic hula, Tahitian shimmy and Maori slap lava; Kaneohe Bay, w here glassdances at night? bottom boat rides are offered; ByodoAnd the city has a diversity of sight In, a replica of a Japanese Buddhist seeing attractions that staggers the im temple; and Waimea Falls Park, con agination: the Honolulu Academy of taining an arboretum, a bird sanctu Arts, with extensive W estern and ary, hiking trails, picnic sites and offer O rien tal co llectio n s; the W aikiki ing hula and cliff-diving exhibitions. Aquarium, with brilliantly colored For the sportsperson, there are tropical fish and om inous-looking more than two dozen golf courses and sharks; the 100-year-old F alls of more than 75 public tennis courts and Clyde, the world’s only surviving full- 50 private courts in and around Hon rigged four-masted sailing ship; the olulu. In addition, one can deep-sea Queen Emma Museum, the restored fish for marlin and sailfish, hunt for summer home of the 19th century wild pigs and goats in the nearby Hawaiian ru ler; and C hinatow n, mountains, skin dive in Shark’s Cove, where everything from pastries to hike on dozens of trails, or swim, surf, pearl jewelry may be purchased. sail, hang-glide or even ice skate (at an There’s also Pearl Harbor, with a indoor rink, of course). museum and the U .S .S . Arizona For those whose interests lean more Memorial; Aloha Tower, Hawaii’s ver toward dining than diving, Honolulu sion of the Em pire State Building, offers numerous native delicacies such with spectacular views of the city and as the traditional luau (feast) special harbor; Castle Park, a nearby 16-acre ties, roast pig and poi, a thick paste amusem ent park; the Bishop Mu made from taro root. Local seafoods W H aw aiian hero is Kamehameha I, who united islands into one kingdom and founded mid-Pacific Kamehameha dynas ty. His statue stands in front of Judiciary Building in Honolulu's civic center. (Hawaii Visitors Bureau photo.) include mahimahi (dolphin), moi (mul let) and ahi (yellowfish tuna), and fresh tropical fruits like mangoes, papayas and pineapples abound. There’s even a native coffee — Kona. I f one doesn’t want to dine Ha waiian, however, the choice of cuisines includes American, British, Chinese, East Indian, French, Greek, Irish, Italian, Japanese, Korean, Mexican, Morroccan and Vietnamese. For the homesick, there are many familiar American fast-food outlets, too. The weather should be grand in October, with an average daily max imum temperature of 82 degrees F and an average daily minimum of 72. “Honolulu” means “fair haven,” and although the name is believed to refer specifically to the metropolis’ excellent harbor, the name certainly could apply to the entire city — an idyllic location for the ABA convention. • • Free hula show is given in the W aikiki area three times weekly, staged especially for camera fans by Kodak-Hawaii. Haw aiian, Samoan and Tahitian dances are performed. (Hawaii Visitors Bureau photo.) 22FRASER Digitized for https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for September, 1983 For a correspondent banking network with services in over 150 countries, look to BankofAmerica. Through a single Bank o f America International is so large, in America account, you can do fact, that based on deposits, it would rank as one o f the 50 largest banks business virtually anywhere in in the U.S. the world. Dealing with us, you dont need a In Asia, we have branches from different correspondent for every Japan to India. In Latin America and country With Bank o f America, you’ve the Caribbean, we stretch from Uru guay to Guatemala. In Europe and the got the world. B ank o f Am ericas global network Middle East, we cover 22 countries from Ireland to Pakistan. Plus, we have o f offices can provide a broad range o f correspondent sewices: from affiliates, subsidiaries and represen import-exportfin a n cin g a n d foreign tative offices around the world. Here in the United States, Bankexchange trading to special-purpose loans in local currency, letters o f credit, America International, our whollyowned subsidiary, gives you coast-to- marketable acceptances a n d more. coast service with 12 offices from New York to San Francisco. BankLook to the Leader.” BANK of AM ERICA Bank of America NT&SA • Member FDIC © Bankof America NT&SA 1982 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C o rre s p o n d e n t B an kin g S ervices M ore Loan-R eview Com m ittee Benefits Reported by Surveyed Institutions HE AUGUST issue included the results of a reader survey on the benefits of loan-review committees. A number of responses received after our press deadline are included in this follow-up report: F ir s t N a tio n a l, A r te s ia , N. M ., established a loan committee and — after a nationwide search — hired a loan administrator when it became apparent that the $ 130-million bank with a $60-m illio n loan portfolio needed increased loan supervision, according to C. Neal Johnson, presi dent. The loan committee is comprised of the CEO, president and five outside directors. The new loan administrator was hired as a senior vice president with supervisory control over the en tire lending function. He reports directly to the president. The loan comm ittee meets monthly with all officers present to review an array of loan-portfolio statistics. Each lending officer’s delinquency totals, a list of customers by degree of delinquency, a special credit-attention list and the officer’s charge-off list are reviewed at each meeting. Weekly loan officer meetings are held to review loan policies, trends and problems and to conduct educa tional sessions. While there is no formal loan-review process prior to making loans, loan officers consult informally with either the loan officer, president or CEO. Once a week, the president and the loan officer get together to discuss all lending-related m atters, including loan pricing. Despite a high delinquency rate, the bank is in better shape than its peers seem to be, thanks to the new system, Mr. Johnson says. First National has a four-to-one mix of com m ercial loans to consum er loans. Peoples Bank, Selma, A la., estab lished its loan-review committee in 1978. The com m ittee includes the president/CEO, executive vice presi dent and four directors. The credit officer attends meetings and loan offi cers and others meet with the commit- Loan Workout Aids Given EW , MORE PRODUCTIVE re expertise of the loan-workout group of sponses are “urgently needed” a larger correspondent bank. that attack underlying causes of non“For larger banks, those with assets performing loans and help to resurrect over $1 billion, part of the solution is to form its own internal workout group,” them as profitable assets, say James R. Johnson III, vice president, commer Messrs. Johnson and Marks say. “In cial asset management division, First smaller regional banks, this can be a "home-grown’ person with good credit National, Chicago, and Edwin A. Marks, president, Metier, Marks & and negotiations skills. Bankers who Associates, Chicago-based manage are negotiators and yet understand the tradeoffs required in restructuring ment-consulting firm. Their views appeared in a recent problem credits usually make good issue of C om m ercial Lending N ew slet workout specialists.” The workout specialist, sometimes te r , published by R o b ert M orris with the initial help of the former Associates. Nonperforming loans always have account officer, attempts to gain im been a burden to lenders, but today’s mediate insight into the company by portfolios of nonperform ers have taking the following steps, according to grown so large they threaten the sur Messrs. Johnson and Marks: • Making a cursory review of the vival of lending institutions, Messrs. Johnson and Marks assert. The best credit files, financial statements and response for smaller banks might be to other pertinent documents. • Interviewing all key members of retain legal counsel that has good con tacts with accountants, liquidators and the management team. • Analyzing the history and projeccollection agencies, they say. Smaller (C ontinued on page 46) banks also may consider calling on the N 24 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis tee as needed, says J. Clyde Walker Jr., credit officer of the $ 117-million bank. Each month, the committee reviews positions and changes in all larger lines of credit ($50,000 or more) established during the prior month. It reviews all loans of $10,000 or more and loan re views are presented from selected lines, including “trouble” lines and agricultural lines of credit. Past-due loan information also is reviewed and periodic updates are given on “trou ble” lines of credit. Charged-off loans are reviewed and recommended for board approval and authorizations are made for changes in loan status. The committee also approves unusual loan requests on a “need” basis. Security Bank, Mt. Vernon, III., an $ 1 15-million institution east of St. Louis, has had a loan-review program for about five years, according to Arthur Buesking, senior vice presi dent. Loan officers and representatives from the collection department make up the committee. Loan officers pre sent loan reviews to the committee prior to the time the bank’s position on each loan is determined. Top priority is given to large-dollar loans and those that are questionable or problems, Mr. Buesking says. Fol lowing each meeting, the decision on how to deal with affected clients is documented in each customer’s file. “We feel this process has been ben eficial to our loan officers so they are fully aware of substantial bank custom ers as well as potential problems with particular borrowers,” Mr. Buesking says. Industrial Bank, H ouston. A loanreview committee established by this $104-m illion bank in 1974 was re vamped in 1977 to make it more effec tive, says A. Glynn Slaydon, presi dent. The committee consists of all loan officers, the president, the execu tive vice president and the cashier. At weekly meetings, loan pricing, past-due loans and government reg ulations affecting lending are dis cussed. The meetings are especially helpful, says Mr. Slaydon, because the bank is located in two separate build ings and com m unication betw een lending officers would be difficult MID-CONTINENT BANKER for September, 1983 “WithFirstTktmwork,yourrelationship withFirstChkagoishtjustbankto banklfspartnertopartner’ “When you are a correspondent of First Chicago, it means having access to the vast resources of a money-center bank. It means having team s of specialists w orking together to deliver the kind of products your bank needs. And it means a partnership that supports instead of supplants. “You w on’t find a bank in the Midwest that’s organized to deliver its resources more effectively than First Chicago. You’ll w o rk w ith a relationship manager from our highly trained specialty team s—the Com munity Banking Team, the Illinois Team and the Midwest Team- -according to your specific needs. “When you’re a correspondent with First Chicago, w e w on’t ju st be w orking with yo u— w e ’ll be w orking fo r you. “ See how First Team work can w o rk fo r you. Call me, Neal Trogdon, at ( 312) 732-7780.” F irst Chicago Atlanta—Baiti more—Boston—Ch icago— Cleveland—Dal las—Denver — Houston—Los Angeles— Miami — New York—San Francisco— Washington, D.C. I l l FIRST CHICAGO vsjégp The First National Bankof Chicago S am ThomasM. King, Communil} 1Hanking IM ip H. y Britt, FIRST TEAMWORK WORKS © 1 9 8 3 The First National Bank o f Chicago. M em ber FD.I.C. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 25 Im agine building a new home for your bank w ith som eone a thousand m iles away from home. “ When you th in k about building, you naturally consider your own local resources firs t,” says Frank Etheridge, president of Perkins State Bank in Williston, Florida. “ We had capable firm s available, but we’d also heard about the fine plan-design-build reputation of HBE up in St. Louis. We decided to investigate.” “We found they knew a lot more about banks because they make this business a specialty at HBE.” “ The best word for it, I think, is professionalism. HBE really knows what makes banks tick. They work with so many they can tell you right away if an idea will work or if there’s a better way to do it altogether. That’s the kind of competence th a t can also save you from somebody else’s naive mistakes. Everybody can see i t — we even have contractors on our board, but we all became con vinced tha t HBE’s superior expertise made it the clear choice.” “The thousand miles vanished when we got HBE for neighbors right here in town.” “ When construction actually began, HBE immediately moved th e ir superintendent into our area. He was here for the entire time, working on a daily basis with local subcontractors. And it went so well, as a m atter of fact, tha t the entire project was com pleted almost sixty days ahead of schedule.” “They really have the people— in force.” “ Some organizations, despite th e ir reputation, can leave you w ith just a salesman to deal with. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis But HBE is fully staffed with architects, engineers, construc tion managers, and so on. And they’re always just a phone call away. Any tim e you want to talk to them, they’re all there under one roof—real professionals, on staff, who know what they’re talking about.” “We’re attracting more business, too.” “ HBE helped us increase our customer appeal by developing an entirely new and exciting image program. It embraced not only the concept of the building and the site, but a new logo and an entirely new corporate identity. When we moved in, we saw business increase by more than 50% the firs t year. That’s the kind of marketing insight you get from HBE.” You can put your full confidence in HBE. We can underline what Mr. Etheridge has said. HBE is determined to make every project work the way you want it to. Call or w rite me, Sally Eaton, right now at 314/ 567- 9000 . HBE Bank Facilities, 11330 Olive Street Road, St. Louis, Missouri 63141. 2 2 HBE B ank Facilities You can’t afford not to look at HBE https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Our new building is all we wanted it to be and more, thanks to HBE.” Frank Etheridge, president of Perkins State Bank, likes everything about his new HBEdeveloped facility at Williston, Florida. [PERKINS ISTATE BANK otherwise. The meetings also give loan officers an opportunity to familiarize themselves with customers besides their own, he adds. One of the most important functions the committee performs, however, is updating the bank’s credit information and required documentation, accord ing to Mr. Slaydon. C entral Bank o f the South, Birm ing ham , A la., has no formal loan-review committee, but in early 1982, the $2.6billion bank established a loan-review department that performs a similar function, says W. Jack Jam es Jr ., senior vice president. A random sam pling of loans below a specified dollar amount determined by the credit com mittee is conducted. Loans above the cutoff require a full review, including documentation, and a report on all loans determined to be substandard is forwarded to line managers as well as the responsible group executive offi cer. The credit committee is given a summary report on loan deficiencies once a month. The quality of credit has improved since implementation of the program, says Mr. James, although how much the program is directly responsible is still in doubt. The biggest benefit, he says, appears to be in the program’s ability to spot problem areas early, providing more time to find acceptable solutions. Victoria (Tex.) B an k. In early 1982, a loan and discount committee formed years earlier was converted to a loanreview committee, says Paul T. Brysch Jr., loan-review officer. Currently serving on the committee are all members of top management as well as the heads of the credit depart ment, loan-review department and the four lending departm ents. Im ple mentation of new loan-review proce dures has stimulated a great awareness of the credit worthiness and financial strength of debtors at the $571-million institution, according to Mr. Brysch. C itizens N ational, In d ep en d en ce, Kan., uses a rating system to deter mine the quality of existing loans, says James P. Kelly, vice president. Two weeks prior to the maturity date of a loan, the computer generates a notice that is mailed to the customer. The loan-review department — estab lished several months ago — uses this notice to trigger a review of the cus tomer’s file. If all necessary financial information is available, the loan is given a quality rating; otherwise, the necessary information is requested of the loan officer, who is expected to complete the file before the note ma tures in two weeks. Different rating systems are used for 28 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis agriculture, commercial and personal lines. Ratings assigned to each custom er file take into consideration different financial ratios and other general in formation about the customer. Files not completed within two weeks are turned over to the senior lending offi cer at the $70-million institution, who reviews the file and takes whatever ac tion he deems to be fit. While it is still too early to measure the success of the program, the files of 272 customers have been reviewed and there have been “real strides” in improving the documentation of ex isting loans, says Mr. Kelly. Officers also are becoming more detail con scious on the loans they make and an improvement in customer financial in formation in the files has been noticed, he says. In the first part of this article, pub lished in the August issue, the word “Plains” was inadvertently omitted from the title of Plains National Bank, Lubbock, Tex., whose presi dent, Tom Battin, submitted in formation about his bank’s loanreview program. We apologize for any inconvenience and/or embar rassment this omission may have caused. The Editors. F ourth National, W ichita, is a $556million institution with a loan-review committee nearly a decade old. There have been recent efforts to increase the staff so that more loans can be re viewed, according to Keith Gravel, vice president. The chairman of the committee is the senior loan officer. O thers who serve in clu de: the senior vice president in charge of the com m ercial-loan departm ent, four credit analysts, the manager of com mercial-loan operations (who serves as supervisor of credit-analyst person nel), the auditor and the in-house legal counsel. Four credit analysts review the financial statements of each account being analyzed as well as check the applicable documentation for each loan. Findings of the credit analysts are summarized in memorandum form and distributed to each committee member prior to a loan-review com mittee meeting. The committee meets biweekly and following the meeting, a second memorandum summarizing the committee’s observations and rec ommendations and a loan rating is pre pared on each account reviewed. The second memorandum and the loanreview memo are distributed to senior executives of both the bank and the holding company. W hile few “surprises” have been uncovered by the loan-review commit tee — a tribute to the performance of loan officers — the program has en couraged loan officers to correct docu mentation problems, and — in some cases — to restructure loans, says Mr. Gravel. First Bank, M ichigan C ity ,In d ., has a four-year-old loan-review committee which recently changed its meeting schedu le to m onthly rath er than quarterly due to the current state of the economy, says Jack Armstrong, vice president. The committee con sists of the loan-review officer and — on occasion — other officers who may have responsibility for a loan on the institution’s watch list. The committee is used primarily to pool experience and creativity in han dling problem situations, but the $179million institution has a policy of not advancing more money to a client on the watch list w ithout the prior approval of at least two members of the committee. Mr. Armstrong says the committee has helped to keep lines of com munication open in working out prob lem loans. Fidelity Bank, M inneapolis, an affil iation of seven banks with total assets of $300 million, developed a loanreview program in 1978 to avoid “sur prises” in the bank’s commercial and agricultural loan portfolio, says David Gilman, president. The review is completed by the loan officer with subsequent reviews by the bank manager and the corporate loanreview staff. Emphasis on simplicity without sacrificing thorough analysis of the most significant risk factors is the cornerstone on which the program is founded, Mr. Gilman says. The program has been successful, he says, because the banks have not been surprised during examinations by regulatory authorities and the transm ission of information about problem accounts is immediate, per mitting rapid remedial action, he says. Bank Launches Old-Fashioned 'Grow, Show and Sell' Fair First National, Libertyville, 111., launched an annual “Grow, Show and Sell” mini-fair recently. Participants 14 and older were en couraged to submit entries in the cate gories of flowers, fruits, vegetables and by-products (baked or canned goods). Winners in each category were en tered in a drawing for 12 cash prizes totalling $700. After the drawing, all entries and donations were sold to benefit a local charity. MID-CONTINENT BANKER for September, 1983 If a bank answers, hang up. As a correspondent of The Boulevard Bank, you don’t deal with a bank, you deal with a person — a professional correspondent banker. Each one is a senior Boulevard officer and each one is capable of making some seventy Boulevard banking services available to you and your customers. This unique Boulevard combination of “ big bank” service and personal attention involves four basic areas - Loan participations, Assets-Liability Management Services, Operational and Clearing Services and Management and Marketing Services. It also involves our day-to-day dedication to applying people and state-of-the-art technology in helping our correspondent customers meet the challenges and benefit from the opportunities of today’s and tomorrow’s economy. If you’d like to find out more about the Boulevard approach to correspondent banking, call (312) 836-6868. And talk to a person, not a bank. Earning your business every day. National Boulevard Bank of Chicago Boulevard Bank 410 N. M IC H IG AN AVE., C H IC A G O , IL 60611 ONE ILLINOIS CENTER (111 E. W acker), CHICAG O , IL 60601 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis (312) 836-6500 • MEMBER FDIC 29 Mortgages Will Be More Affordable, M G IC North-Central Survey Shows ONTINUED economic recovery loan refinances, which accounted for and a return to more reasonable 36% of all originations nationwide for in terest rates should mean that the first quarter of 1983, are, however, homeowners will be seeing more expected to slow as the year proceeds. stable, affordable mortgage plans than “The high rate and unique mortgage have been available during the past arrangem ents borrow ers accepted two years, according to the recently under the stress conditions of 1981 and released results of a semi-annual mar ’82 are gradually disappearing in to ket survey by Mortgage Guaranty In day’s mortgage market,” he explained. surance Corp. (MGIC). “Furthermore, the availability of more Conducted in May, the survey of affordable mortgage rates — at levels north-central mortgage lenders is the lower than those experienced during fourth in a series of studies that track the past two years — is expected to changes in the mortgage environment open the market to more potential and analyze vendor perceptions of the home buyers.” marketplace. The north central geo W hile borrowers will be able to graphic survey region included lend choose from a broad array of mortgage ers in Illin o is, W iscon sin , O hio, instruments, the fixed-rate mortgage Michigan, Indiana and Minnesota. and the ad ju stable-rate mortgage “The major findings show that re (ARM) are emerging as the prominent gional mortgage lenders are projecting loan plans for 1983. Today, more than a record increase in home-loan origina 30% of the north-central regional lend tions for 1983,” said Jack Reichert, ers plan to feature both instruments, senior vice p resid en t and north- supplemented by a mix of other mod central division manager of MGIC. ern loan offerings. “Lenders forecast a 74% increase in Survey findings show that the fixedmortgage-loan originations this year — rate mortgage is likely to dominate which is twice the increase originally loan originations, comprising 61% of projected for 1983 by this same group total lending — a 13 percentage-point in 1982.” increase from last fall. The ARM mort To meet this renewed demand for gage, in comparison, will continue to home financing, Mr. Reichert noted retain its approximate one-third mar that borrowers will see a shift in the ket share. types of mortgage plans offered by Mr. Reichert commented that loan lending institutions. Creative-financ ch a ra cte ristics of the ARM have ing techniques, popular during high changed to reflect consumer demand. interest-rate periods, are expected to Earlier MGIC surveys conducted dur fade into the background as traditional ing the sellers’ market of the past two fixed-rate and longer-term, consumer- years revealed regional lender prefer oriented, adjustable-rate mortgage ence for ARM instruments with annual plans become stronger. interest rate and payment adjustments High-interest-rate loans originated to correspond with the timing of typi over the past two years are being refi cal household compensation changes. nanced at current-rate levels. These The 1983 survey indicates that con C 7N. Money Bags Buy Direct from the Manufacturer • Night Deposit Bags • Individual Pocket Bags • Canvas Coin Bags • Zippered Wallets • Lead Seals Many sizes and styles available in a wide variety of colors and materials. FREE silk screening of name and logo with minimum order. FAST DELIVERY!!! Laacke & Joys Quality Since 1844 Bank Products Division P.0. Box 92912, Milwaukee, Wl 53202 PHONE (414) 271-7885 Ask for Bank Products 30 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis sumer concern about ARM payment uncertainty has forced mortgage lend ers to lengthen ARM adjustm ent periods, according to Mr. Reichert. Nearly half of all regional lenders now plan to delay rate and payment adjust ments until the two-year to three-year mark and even to four- and five-year intervals. “There is little doubt that this move to longer ARM periods is a conscious effort by north-central area lenders to balance consumer concerns regarding rate and payment volatility with their own lending risks,” he observed. Although the current interest-rate environment and lower levels of infla tion have eased the consumer afforda bility issue, reduced monthly pay ments often provide the necessary in centive for potential home buyers to enter the markets, Mr. Reichert con tinued. As a result, 43% of the lenders plan to discount the initial loan rate on ARM instruments. And the proportion of lenders who will permit negative amortization has declined from 54% two years ago to 13% today. In addition, a variety of modern mortgage instruments will be available to meet the specific loan needs of cer tain borrowers. Balloon mortgages, early ownership mortgages and gradu ated-payment mortgages — while de clining in overall market popularity — will continue to be made available to home buyers as customized alternative loan plans. Survey findings show that these three instrument types com bined will account for 11% of lending volume in 1983. “The regional mortgage finance market of the past few years — while often volatile and uncertain — has pro duced some positive results. It has ex panded perm anently the range of mortgage instruments available and the terms of those instruments to meet the specific loan needs of potential home b u yers,” Mr. R eichert con cluded. • • • Eighteen case histories of successful telemarketing campaigns are chroni cled in T elem arketing Cam paigns That W ork! published by McGraw-Hill. The author, Murray Roman, is chair man of a company that conducts tele marketing campaigns. • Guide to the M anufactured Housing Financing Com m unity contains the names, addresses, telephone numbers and lending-officer contacts of about 1,000 manufactured-housing lending institutions as well as a list of major manufactured-housing insurance com panies. For more information, contact David J. Leichey, Box 1981, Palm Springs, CA 92263. MID-CONTINENT BANKER for September, 1983 We turn on a dim e so you can turn a larger profit. W h en m oney is exp en sive, so is th e tim e funds are idle. T h a t’s w hy so m an y b an k s rely on N o rth ern T h ist B a n k for p rofit-en h an cin g corresp o n d en t serv ices. O ur exp er tis e in g e ttin g funds to work q uickly an d p ro fitab ly h a s earn ed u s th e rep u tatio n of being a p re m iere p ro ce sso r for co rresp o n d en t b an k s. In fa c t, in independent su rv ey s, T h e N o rth ern TVust co n siste n tly ran k s a m o n g th e top th ree ca s h m a n a g e m e n t providers in th e in d u stry. T h e la te s t in co m p u te r te c h n o lo g y a ssu re s ch eck collection an d safekeeping t h a t ’s a ccu ra te and fa s t. O ur C ashline B a la n ce R ep o rtin g S y ste m g iv es you elec https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis tro n ic a c ce ss to y o u r a cco u n t lo r m a x im u m flexib ility You ca n g et a fresh u p d ate every 15 m inutes if n e c e s s a ry — and m ove m oney w ithin h ou rs ra th e r th a n d ay s. A d d to our so p h isticated eq u ip m ent th e b e st in personal a tte n tio n and resp on siven ess, and you g e t N o rth ern T ru st’s ideal co m b in ation of q u ality and effi ciency. A ded icated staff of profes sionals a ssu res you personal a tte n tio n in all tra n sa ctio n s. W e’re also read y to a s s is t you in han d ling you r in v estm en ts. A n d ou r exp erien ced B on d D e p a rtm e n t rep resen tativ es are alw ays on hand to provide know ledgeable ad vice. W ith N o rth ern TVust B an k behind you, you ca n co u n t on b e tte r service for you r cu sto m ers. A n d a b e tte r b o tto m line for y ou r b ank. F o r m ore in form ation , c o n ta c t C u rtis E . Skinner, Senior Vice P resid en t, N o rth ern TVust B a n k , 50 S o u th L a S a lle S tre e t, C hicago, Illinois 6 0 6 7 5 . Tblephone: (312) 6 3 0 -6 0 0 0 . M em b er F .D .I.C . The more you want your bank to do, the more you need The Northern. N orthern TVust B an k Leave the snarls of Money O rder processing to the PaperTiger Your back office has enough to do processing all your daily proof items without having to get involved in the problems of your Money Orders. Money Orders are probably only a service item with you, not the meat of your business. They are our main business. Travelers Express (the Paper Tiger) has been in the funds transfer field for over 40 years. We’ll take over that back office workload and free your people for more cost-efficient work. 32 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis We supply drafts that are faster and simpler to issue; and do all the reconciling, tracing, storing, filing, payment stopping and handle all the other problems that occur daily. Find out more about how the Paper Tiger can help you lower your costs and reduce problems with Money Orders and Official Checks, too! He’ll work expressly for you. For more information call 1-800-328-5678 and ask for Gene Lewis. Travelers Expressly working for you. MID-CONTINENT BANKER for September, 1983 SECURITY New Design to Make Visa Cards More Secure IS A IN T E R N A T IO N A L has placed new security properties in a revised new design for all Visa cards in an attem pt to make the cards more secure. Properties being added to the card include a border of bank identi fication codes m icro-printed around the marks and security panel; a field of fin e -lin e p rin tin g in th e p ro d u ctidentification panel; the dove in flight, a trademark printed with ink visible only under ultra-violet light; and an em bossed security symbol. O ther new security precautions on the card are a printed replica of the bank-identification num ber above the em bossed num ber; either a hologram (three-dim ensional picture) or lens shaped print of the Visa dove, incorpo rated in a security panel covering the la st sev en d ig its o f th e a cc o u n t num ber; and coding, known only to V isa secu rity o fficers, that can be changed randomly as part of the pro duction process. All Visa cards will be converted to the new design which will include the Visa name, and blue, white and gold bands as identification of the world wide Visa payments system. The design also will feature a new product trademark to identify different types of Visa cards and a security sym bol in a panel placed vertically at the right side of the card. Each bank offering the Visa card will design the card face to feature its own identity and services. The design will incorporate Visa trademarks. “T h e se new ca rd -se cu rity prop erties will make Visa cards extrem ely difficult and hazardous to counterfeit, ” says D. W. Hock, president, Visa In ternational and C E O , Visa U .S.A . The security features and new de sign will be phased in with issuance of the Electron card later this year, and will be com pleted within three years, according to Visa. “The new design will allow us to place a security symbol directly over the last several digits of the em bossed account num ber, combating the most com m on form o f co u n terfeitin g — changing account num bers,” says Mr. Hock. The new card security properties are only part of Visa’s fraud-control program, he adds. “T h e long-term solution to card fraud and to the larger problem of credit loss is to electroni https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis the end of the year. In addition, Visa is: • Developing a low-cost audio re sponse term inal with Texas In stru m ents to brin g tran sactio n -au th o r ization service to the small retailer. • Developing technology for elec tronic signature v erification with a company formed by Visa and SR I In ternational. • Expanding its transaction-proc essing facilities and telecom m unica tions network to accommodate growth in volume of authorization inquiries. Two doves, one conspicuous and one near ly in v is ib le , are am on g n ew a n t i counterfeiting properties being incorpo rated in new Visa card design. Security features and new design w ill be phased in beginning early next year as part of threeyear changeover. cally identify each custom er as the per son authorized to present the card, to au thorize ev ery tran saction at the point of sale and to continue vigorous prosecution of fraud when it occurs. ” To that end, Visa m em bers have in stalled or ordered more than 35,000 point-of-sale dial terminals and Visa projects another 8 ,0 0 0 installations by House Subcommittee Passes Credit-Card Fraud Bill Legislation aimed at closing loophol es th a t p e rm it crim in a ls who fraudulently use credit cards and cred it-card account num bers to flourish has passed a subcom m ittee of the House banking com m ittee. The so-called “C redit Card Protec tion Act” would give the federal gov ernm ent jurisdiction over a wide range of credit-card abuses currently cov ered by a patchwork quilt of state laws. F ra u d u len t use o f c re d it cards or account numbers would be prohibited by federal law and possession of five or more illegally obtained cards or ac count numbers would becom e a fed er al criminal offense. Criminals have been able to escape prosecution for credit-card offenses by keeping the fraud attributable to any one card below the cu rren t $ 1 ,000 minimum. That would change under the new law. The $1,000 minimum would becom e cumulative so that any c r e d it-c a rd o ffe n se a m o u n tin g to $1,000 or more could be prosecuted under federal laws regardless of how many individual cards w ere involved. BAI Manual Offers Methods To Reduce ATM Security Risks A new manual, A T M S e c u r it y , de scribes the potential risks of automatic teller machines, from possible threats to custom er and employee safety to physical security of the equipment. Published by the Bank Administra tion Institute (BAI), the manual pre sents practical ways for banks to im ple m ent “effective programs to reduce the risk of injury, liability and financial lo ss,” says Richard M. M cCormick, chairman of the BA I’s security com mission. W ith certain exceptions, the draft of the bill passed by the House subcom m ittee on consumer affairs and coinage also would make it illegal for bu s inesses to reveal custom ers’ creditcard account numbers. A nother anti-fraud bill aim ed at stopping credit-card abuse currently is being considered by the Senate. The House and Senate may ultimately have to work out their differences in a con ference com m ittee if they end up pass ing different versions of the same leg islation. The Senate bill takes a differ ent approach to curbing credit-card abuse than the House bill does. The House banking com m ittee was expected to pass its version of the bill after the August recess and full House approval could com e as early as late Septem ber. M ajor credit-card companies gener ally have been supportive of legislation that would curb th e m ushroom ing credit-card abuse problem. Last year Visa lost $20 million on credit-card counterfeiting, up from $12,000 a de cade earlier. M asterCard says its total fraud and cou nterfeiting losses last year were $45 million. BG/1 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis N o m a tte r w h a t yo u r b u sin ess, th e e n v iro n m e n t o f th e 80 ’s w ill b e m o re c o m p e titiv e th a n e v e r Among your most critical decisions for the future will be your marketing plans. Quality signage is one of your most durable, cost-effective marketing investments. It identifies and projects your desired image. It motivates, day after day, year after year, attractively and emphatically. Since 1901, Federal Sign has been the nation’s premier designer and manufacturer of signs. Its resources, facilities and staff are unmatched in the industry. And it produces its own electronic message displays. Whether you’re considering a nationwide program or one location, don’t trust your signage to anyone less. Call Federal Sign. Chicago....................................(312)887-680I Dallas/Fort Worth___(817) 261 -234 Houston....................................(713)522-1601 Indianapolis.............................. (317)875-533: Kansas City........... . .(816) 861-4401 Knoxville...................(615)577-165: Louisville.................................. (502)499-022I Milwaukee................................ (414)374-740I National Sales............ (312) 887-688: San A n to n io ............. (512)341-822: St. Louis.................................... (314)371-2001 Division Federal Signal C orporation Bank U ses D a le C arn eg ie C o u rses To M otivate Staff to Produce Sales AVE YOU ever observed a highly motivated individual who was c o n s c ie n tio u s ab o u t paying compliments to others and thought, “He must have taken a Dale Carnegie course?” C a r n e g ie ’s “ How to W in F rien d s and In flu en ce P eo p le” p h ilo so p h y has b e e n used for y ears by a broad sp ectru m o f businesses to improve custom er and personal relations. But the banking industry still is “virgin territory” for Carnegie methods, claim s C e n tra l C o u n ties Bank President E lm er G. Grant, who gives the technique a lion’s share of credit for tripling his institu tio n ’s assets and expanding its offices from six to 16 during a twoyear period. Mr. Grant has used a variety of Carnegie courses and strategies to help move his bank, located in State C ollege, P a., from 926th place to 386th place in the list of largest banks in the country — and all in ju st a decade’s time. He says his bank is th e fastest growing fin a n cial in stitu tio n in a fivecounty area of central Pennsylva nia. H e began u tilizing C arnegie methods when he accepted the bank’s presidency in 1972. “I gave up a very secure and prestigious senior vice presidency at P itts b u rg h N a tio n a l,’’ h e says, to accept the challenge of building a strong regional bank. H e began with th e prem ise: F u ll-serv ice bankers need fulls e r v ic e tra in in g . B u t C e n tr a l Counties had no training program. So Mr. Grant initiated the Dale C arnegie courses becau se they “provided instant training without a waiting period .” T h e C a rn e g ie m a n a g e m e n t seminar was required “for our en tire management staff, from the president down to line m anagers,” he says. “Sessions w ere scheduled during nonbanking hours. W e learned to understand the impor tance of clearly defining the bank’s H https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis o b je c tiv e s ” and th e way each m em ber of our management team fit into those objectives. To d a te , 170 m a n a g e m e n tposition em ployees have taken the D ale C arnegie m anagem ent-by objective course. The program has enabled the bank to d ev elo p a le a d e rsh ip structure, says Mr. Grant, “one th a t has s u b s ta n c e , n o t ju s t theory. Not only do we define our objectives in writing, we report back quarterly in writing to see what we have accom plished to ward our goals. This strict routine or regimentation stimulates b etter personal discipline and account ability. “Every m em ber of our manage ment team knows what’s expected in te rm s o f p e rfo rm a n c e ,” he emphasizes. “Our branch mana gers no longer function by the seat of th eir pants, floundering and chang ing d ire ctio n ev ery day. • They know where they’re going, how and why. T here is a game plan and they have been a part of the strategy.” O f even g reater significance, stresses Mr. Grant, is that the bank’s more capable em ployees have risen to their potential.” As his managem ent team de veloped a structured leadership, Mr. Grant observed the need for all bank employees to learn more about customer relations and per sonal d evelopm ent. M ore than 3 0 0 C en tral County em ployees w ere given a Carnegie course desig n ed to im p ro v e h u m anrelations skills. All reported that th e ir self-con fid en ce im proved and they were able to form more productive and rewarding person al relationships. “O f special note was the amount o f appreciation expressed by mid dle-level p eop le,” says Mr. Grant. “They said the course made them fe e l that th e bank cares about th em .” E xperiencing measurable suc cess with the first two Carnegie programs, Mr. Grant decided to o ffe r a th ird — an e ffe c tiv e s p e a k in g -a n d -h u m a n -re la tio n s ( C o n t in u e d o n p a g e B G /1 0 ) Employees of Central Counties Bank, State College, Pa., participate in confidence boosting course staged at bank by Dale Carnegie & Associates, Inc. Bank has been utilizing Carnegie courses for several years. BG/3 N ew Products, C reative M arketing Keys to M eeting N onbank Com petition ^ ^ ^ ^ O M E 4 ,0 0 0 nonbank fi- ^ ^ n a n c ia l in stitu tio n s are competing with banks and thrifts. None of them existed five years ago. One of them has 856 branches nationwide and its name is Sears, Roebuck. ” These statements w ere used by M ic h a e l H ig g in s, p re s id e n t, Overland National, Grand Island, N eb., to set the stage for a discus sion of future banking products at a recent bank C E O conference. W e know com petition is going to be keen and we know what’s going to happen to our spreads tality to a custom er-orientation mentality. And these two m entali ties are as d iffe re n t from one another as selling horses is to sell ing je t aircraft as a means of trans portation.” M r. H iggins says th ere isn ’t anything bankers are going to be doing in the future that won’t be dramatically new and significantly changed from the way the indus try did things in the past. “W e must com pletely restructure our organizations to deliver our prod ucts and services from a basis of customer need rather than from a Bankers must realize th a t the new m arketing a tti tude recognizes th a t "w e've gone from a seller's m ar ket w here w e control everything to a buyers' m arket . . . from a product-orientation m en tality to a cus tom er-orientation m e n ta lity ." and m a rg in s ,” h e said. “ O ne alternative to m eet this challenge certainly is new products — pri marily new products that generate fee income. ” B u t, he said, new prod u cts alone a re n ’t enough to enable banks and thrifts to win the com petition race with nonbank finan cial institutions. Attitudes must be changed. By attitu d es, he m eans how bankers perceive th eir markets and how their markets perceive banks. “W e re going to have to change our marketing approach to one of customer orientation,” he said. “And that’s going to take a whole new group of people, peo ple with entirely different skills than those w e’ve used to com pete with in the last decad e.” Bankers must realize that the new m arketing attitu d e reco g nizes that “w e’ve gone from a sell e r’s market where we control ev erything to a buyers’ market. That means we’re going to have to go from a product-orientation men- BG/4 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis basis of what products we want to sell. ” The central focus must be on custom ers rather than products and bankers will have to listen to their customers so they can under stand customer concerns. “W e ll have to focus on their needs, not ju st on our ow n,” he said. “And if we don’t provide what our cus tomers want, one of those 4 ,000 nonbank institutions w ill!” He advised bankers to becom e creative and provide the products corporate customers need to sur vive, such as fixed-rate loans. And bankers should not take on the mentality that if products can’t be delivered as they w ere formerly, they ju st can’t be delivered at all. “W e will provide what the cus tomer wants or we ll lose an in credibly large piece of the busi ness we have today,” he said. He cited the gold card as an ex ample of a missed opportunity on the part of bankers. “W e had a 15-year jum p on our competitors, but it didn’t occur to us to ask the custom er if he was willing to pay a fairly substantial fee every year to have the benefits of a gold card. ” Discount brokerage is another example. “W hen fees w ere dereg ulated in the securities business, the banking industry should have entered the market in a big way b ecau se it was so far ahead of everyone else. I think we didn’t ju m p in p rim arily becau se we haven’t had to think creatively b e cause our industry really hasn’t been in a com petitive market b e fore. W e w ere in a regulated mar ket, and we were used to having regulators tell us what kind of products we had to offer.” The real purpose of contem po rary marketing is to identify and resolve customer needs, Mr. Hig gins said. He shared an example of this type of marketing at his bank. A m ajor meat-packing firm had moved to Grand Island and every financial institution in the area was in terested in getting the firm ’s business. “W e took the retailer approach to the firm ,” Mr. Higgins said. He knew th e firm planned to add about $9 million worth of addition al facilities at its site and to hire 400 new employees. The firm took over a packing plant that everyone had expected would be closed, saving 200 existing jobs. “W e m et weekly for about six weeks to determ ine how our bank could m eet that custom er’s need, ” M r. Higgins said. T he bankers came up with many ideas, some of which were unusual. O ne was to ask the firm if in formation on cattle-count data in the area would be helpful. “The firm hadn’t done that yet, so we took it upon ourselves to do it with the cooperation of our network of banks in the area,” Mr. Higgins said. The bankers asked the firm if it could organize a cattlem an’s tour of the firm’s main plant in another city. “W e took a couple of bus loads of key cattle feeders to the plant. W e knew our cattle feeders F is i F in a n c ia l in s t it u t io n S e r v ic e s In c . T h e nation’s leading financial institution marketing company; providing management, training, and marketing services to over 2,500 clients in 50 states. ________________ ac co u n t En h ancem ent prog ram s BUSINESS d evelo pm ent prog ram s Differentiate your product and add value to your customers’ transaction, savings, or investment ac counts. 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Proven programs include A ll Em ployee/All Service, X-Sell Sales Administration System, and President’ s Roundtable. D IS C O U N T B R O K E R A G E SERVICES The nation’ s premier video training and infor mation program is used by over 1,500 financial in stitutions. The FISI Video Network brings current, ongoing training to your employees and officers. Professionally produced videotape programs, writ ten support materials, and a video player/recorder machine are provided to Network subscribers. Depositor Investment Service is a discount broker age program with a difference. Your customers receive discount prices o f up to 73% on securities transactions and you receive 18% o f the gross brokerage commissions. Marketing support materials and videotape training are provided. A T M P R O D U C T S A N D SERVICES F lS I has the people and products to help you achieve A T M program success. Diversified A T M support services include professional consulting, turnkey card production and processing, proprie tary and customized marketing campaigns, and discounts on A T M equipment purchases. You con tract only for the specific services needed to maxi mize customer acceptance o f your 24-hour banking service. F IS I V ID E O T A P E T R A IN IN G N E T W O R K IR A D O U B LE S E C U R IT Y P L U S A n IR A enhancement program designed to differ entiate your account and attract and keep indi vidual retirement accounts. Program features include deposit-m atching accidental death insurance, common carrier coverage, and other customer benefits. IR A videotape seminar and marketing support materials are also provided. A sse t/ L ia b il it y M o n it o r Sy s t e m Funds management is made more effective and ef ficient with this microcomputer-based system. A / L Monitor provides you ability to price financial serv ices quickly and accurately for periods o f 1 day to 30 years. Software, hardware, and professional training included. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Financial Institution Services Inc. 49 Music Square West, P.O . Box 40726 Nashville, Tennessee 37204 W A TS : 800/251-2148 (National) 800/342-2109 (Tennessee) BG/5 could benefit from seeing the highquality feeding required by the firm ,” Mr. Higgins said. The bank offered to secure interim office space for use while the firm was reb u ild in g its plant. T h e ban k ers reasoned that the space was needed so the firm could interview and process the 400 new employees. The firm’s management was asked if it wanted the bank to prom ote the firm ’s name in Grand Island so local people would be made aware o f the firm’s product. T h e bank offered to featu re the firm’s b e e f as a deposit premium. “W e had a corral and freezers placed in the bank lobby and decorated the place with bales of hay. W e went through thousands of pounds of b e e f,” Mr. Hig gins said. The bankers asked the firm ’s man agement if it knew the firm’s market potential in the state and offered to help identify this market. The bank provided an 1 ,1 1 0 -p a g e co m p u ter printout of every b e e f consumer in the state and how much and what grade b e e f he/she consumed. “Instead of giving us 30 minutes of his time, as was his original restriction when we came to call, the president of the firm talked with us for four-and-ahalf h ou rs,” Mr. Higgins said. The firm’s usual procedure was to spread its accounts evenly around the banks in town, but, due to Overland National’s creative-marketing approach, the firm gave all of its business to that bank. The firm’s C E O was elected to the bank’s board a few months after the plant began operations in Grand Is land. “Identifying a custom er’s needs can c o m p le te ly tu rn a co rp o ra tio n around,” Mr. Higgins said. It’s essential that bank management anticipate the needs of its high-balance customers, Mr. Higgins said. His bank created a profile of three types of highbalance customers. The first type is the high-income up scale market, made up o f profession als. This market includes 25% of the nation’s high-income households and many individuals in this market have inherited wealth. “These people need tax and invest ment-planning services,” Mr. Higgins said. “They are extrem ely com petitive and they now work with brokerage houses and financial planners. They have higher-than-average interest in discount-brokerage services.” Type two is the retail middle-market cu stom er, w hich co n stitu tes about 45% o f th e total n u m b er o f highbalance cu sto m ers. M ost are twoincome families, are in the mid-’30s age bracket and have average house hold incomes from $25,000 to $50,000. They are convenience oriented and need a broad range of services, accord ing to Mr. Higgins. Retirees make up the largest portion of the third type of high-balance cus tomer. “These people are looking for security, safety and personal service. They are highly loyal and resistant to change and constitute a rapidly grow ing m arket,” Mr. Higgins said. H e r e ’s w hat th e h ig h -b a la n c e - • The Bond Bidder • The BondSwap Manager • The MicroBond Calculator • The Debt Service Calculator For Use with Apple or IBM Personal Computers BG/6 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis PIEDMONT SOFTWARE COMPANY 5200 PARK ROAD, SUITE 119 CHARLOTTE, NORTH CAROLINA 28209 704-527-0117 customer market wants, he said: • All-in-one monthly statements. • One-stop banking. • Equitable pricing of services. • Personal lines of credit, personal financial advice and personal insur ance. • T ra v e l and m e rc h a n d ise d is counts. • Preferred-custom er facilities. • Investm ent new sletters. • Professional seminars. • Discount-brokerage service. “If we don’t offer these services, we won’t get their business, ” Mr. Higgins said. “Bear in mind that these people want to handle all their financial mat ters — including insurance — in one place — their bank!” B an k ers d esirin g to co u rt highbalance customers should do the fol lowing, Mr. Higgins said: • E m p h a siz e o n e -o n -o n e r e la tionships. Train people to be account managers and deposit counsellors. • Identify a financial-delivery sys tem and determ ine what portion of it the bank can offer to its customers. • Find out what customers need in the area of financial counselling. Learn their objectives. Be prepared to offer ad vice in th e secu rities area, real estate, precious metals, tax shelters, deferred annuities, tax exempts, busi ness and investm ent opportunities and short-term traditional instruments. • Create a package of unique invest ment-advisory services that includes n ew sletters, tapes and audio-visual sy ste m s. O ffer it to d isco u n tbrokerage-service customers. • Offer a full line of insurance ser vices at either the bank or HC level. This is a major income-producing area. • Offer real estate services either at the bank or HC level. Mr. Higgins ad v ises th a t b an ks o ffe rin g firs tm ortgage financing do it with the understanding that the packages will be spun off into the secondary market. • Offer discount-brokerage service because it’s good for the customer, it offers product differentiation, lets the bank position itself in a market, offers u n lim ited cro ss-se ll o p portun ities, provides fee incom e and opens the door to “super-financial” relationships with customers. W hen considering any new bank product, M r. H iggins advises that bankers keep this advice in mind: “If my bank doesn’t provide the services the customer wants, one or more of the 4 ,0 0 0 nonbank financial institutions will provide it!” • • 1 2 3 4 5 O L D S T Y L E C O IN W R A P P E R A U T O M A T IC C O IN W R A P P E R Basic coin wrapper in extra strong kraft stock. Printed in 6 Amounts and denominations automatically indicated by different standard colors to d iffe re n tia te denominations. patented “ red bordered windows”. Amounts in windows Triple designation through colors, printing and letters. always in register. . . eliminates mistakes. Accommodates Tapered edges. all coins from lc to $1.00. 6 K W A R T E T C O IN W R A P P E R T U B U L A R C O IN W R A P P E R Wraps 4 denominations in half size packages. A miniature of Especially designed for machine filling . . . a real time-saver. the popular ‘‘Automatic Wrapper” . .. 25c in pennies, $1.00 in Packed flat. Instant patented "Pop Open” action with finger nickels, $2.50 in dimes, $5.00 in quarters. tip pressure. Denominations identified by color coding . . . 6 different standard colors. 7 F E D E R A L BfLL S T R A P Package contents clearly identified on faces and edges by R A IN B O W C O IN W R A P P E R color coded panels with inverted and reverse figures. Made Color coded for quick, easy identification. Red for pennies . . . of extra strong stock to assure unbroken deliveries. Only pure blue for nickels . .. green for dimes . . . to indicate quantity dextrine gumming used. and denominations . . . eliminates mistakes. Tapered edges. 8 C O L O R E D BIL L S T R A P D U Z IT A L L C O IN W R A P P E R Entire strap is color coded to identify denomination. Printed Extra wide .. . extra strong. Designed for areas where halves amount appears on top and bottom of package. Extra wide are wrapped in $20.00 packs .. . ‘‘ red bordered window for for marking and stamp ing. Extra strong stock for safe delivery ease of identification. Accommodates $20.00 in dollars, $20.00 and storage. Pure dextrine gumming. In halves. Tapered edges. B A N D IN G S T R A P S . . . . .. , Ideal for packing currency, deposit tickets, checks, etc.. .. do not break or deteriorate with age. Size 10 x % inches and made of strong brown K r a f t stock with gummed end for ease of sealing. Packed 1000 tc a carton. SEE YOUR DEALER OR SEND FOR FREE S A MP L E S T HE C. L. D O W N E Y C O M P A N Y https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • HANNIBAL, MISSOURI • DEPT. F BG/7 Searching for the Perfect Prem ium : G o o d Planning H elpful, Say Bankers H O R O U G H p lan n in g and careful premium selection are the keys to successful in-lieu-ofinterest promotions, say bank and thrift executives who have spon sored such programs. In search of the p erfect p re mium, financial institutions have tried everything from canoes to co m p u te rs. So m e banks and thrifts have been happy with their promotions; others haven’t. Pro motions that appear to have been the most successful are those that have been carefully planned and th o se th at fea tu re d p rem iu m s chosen for their attractiveness to the target market. Washington Federal Savings & L o a n , S tillw a te r, M in n ., was pleased with the results of a tripto-Scandanavia promotion it spon sored in F eb ru a ry , says Hank Sampson, vice president/marketing. T h e Scan d an av ian to u r marked the first time that W ash ington F e d e ra l had attem p ted such a promotion and there were the usual jitte rs associated with any new project, he confesses. “W e ended up with 24 people going on th e trip , w hich was enough to make the promotion worthwhile, Mr. Sampson says. He credits the success of the venture to its natural tie-in with the local com m unity, w hich is heavily Scandanavian and G er man. Anything with a Scandana vian or German them e is certain to be a “real grabber” in the Stillwa ter area, Mr. Sampson insists. In fact, another in -lieu -o f-in terest promotion is in the works, only this time the trip will be to G er many and Switzerland. To be successful, bank and thrift promotions must be well thought out, Mr. Sampson says. Accepting the offer of the “first salesman who walks through the door with a deal on pots and pans” can, in his opin ion, be a one-way ticket to failure. P rio r to jo in in g W ashington F ed era l, Mr. Sam pson had an T opportunity to plan several E u ro pean tours for a broadcasting firm he worked for. The expertise he acquired was useful in dealing with travel agents and the com plexities of planning a tour for a large group of people, he said. Gateway City Federal Savings, Fargo, N. D ., sponsored a mid w inter “Love B o at” cruise that also produced very satisfactory re sults, according to D arlene E ntringer, advertising/public rela tions d irecto r. F ifty-six people took the tour, 38 of whom had de posited $20,000 each on the prom ise of the trip and a 9% annual retu rn on th eir m oney for five years. Premium Spending Up Premium/incentive spending by banks and thrifts is expected to in crease 6.4% to $589,086,000 in 1983, according to the July, 1983, issue of Pre m ium /in centive Business maga zine. Last year, banks and thrifts posted a 7.8% increase over 1981 premium/ sales figures. Incentive travel repre sented 11.2% of the total premium/ incentive budget for banks and thrifts last year, according to the magazine, and incentive-travel spending is ex pected to increase by 11.2% this year. For Gateway City Federal, the Love Boat cruise was a logical com plem ent to a Caribbean cruise the thrift had sponsored earlier, according to Ms. Entringer. O f course, Fargo does get cold in the w inter, Ms. Entringer points out, so any warm-weather port is likely to be a good draw. A tie-in with a popular telev ision show o f the same name didn’t hurt, she adds. Many of Gateway City Fed eral’s customers are more than 55 years o f age and a large percentage are widows who fear taking long trips to exotic locations by themselves. Ms. Entringer says that those who take a G atew ay C ity F e d e ra lsponsored tour know they will be w a tch ed o v er th ro u g h o u t th e cruise. “W e try to see that they get ex tra-special a tten tio n ,” she says, “and it must work because our trips always are successful. ” An “Aloha” tour to Hawaii is planned for next winter and Ms. Entringer says that interest in the trip already is running high. The only problem was that Gateway City Federal was somewhat hesi tant to make an early com m itm ent to an interest rate for five years, given the uncertainty about the direction of rates. In addition to tours, computers have becom e popular in-lieu-ofinterest premiums for banks and thrifts. Two small banks in Champaign/Urbana, 111., joined forces earlier this year to offer a Kaypro II m icro -co m p u ter and accom panying software for purchase of a 30-m onth $7,500 C D . In addition to a computer, the depositor re ceived two hours of instruction from the com puter supplier. As the home o f the University of Illinois, Champaign/Urbana was the logical location to experim ent with m icro-com puters as a pre mium, says Richard Baker, presi dent of City Bank. He describes the local community as “extremely well educated, white collar and high tech. ” Seven computers were distributed as a result of the pro motion and that translated into more than $55,000 in new money brought into City Bank and its affiliate, M arket Place National. W hile Mr. Baker and Market Place National’s President Al Lutton naturally would have liked to place more computers, they say they achieved their objectives in getting a great deal of favorable publicity for their banks. Mr. Bak er was especially pleased with the high visibility the promotion pro vided. (C o n t in u e d o n p a g e B G /1 0 ) BG/8 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis HowMuchDrive-UpBusiness IsYourPneumatic System CostineYou? •I A u to v ey o r I l m e a n s tro u b le -fre e p e rfo r m a n c e ! W hen your drive-up system breaks dow n, can you be sure custom ers w ill take th e ir business inside, instead o f elsewhere? W h y take the risk? Bavis Autoveyor II® systems are virtually maintenance-free, averaging less than one service call per lane per year. Because the A u to ve yor II is co nve yor-driven, n o t p n e u matic, you w o n 't have to co n te n d w ith the a irflo w in te rru p tio n , m oisture b u ild -u p , or system overload tha t rob pneum atics o f th e ir fu n c tio n a l efficiency. A nd yo u r custom ers w o n 't e xperience the frustration and in co n ve nience o f a system th a t seems to be d o w n as m uch as it's w o rkin g . https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis The A u to ve yor II System carries yo u r cus tom ers' transactions from ve hicle to te lle r and back, safely and reliably - every tim e. So you can sit back and w atch the business flo w . To learn more about the Bavis way to prevent drive-up hold-ups, contact: B A V IS (513) 677-0500 BG/9 LUCO ( J < e r LU C/) h— COZ LULU O Milbank, SD Triangular free-standing display. «■~ *4 , Bethany, MO Corner mounted two-faced. Located in a well-traveled shopping mall, City Bank set up a display of the Kaypro II in a kiosk in the mall. If nothing else, the promotion showed that the kiosk is the best advertising billboard the bank could have, accord ing to Mr. Baker. Brazosport Bank, Freeport, T e x ., is a n o th e r in s titu tio n th a t has ex perim ented with com puters as p re miums. An $ 8 ,444 deposit in a 36month C D earned the investor an Ap ple He com puter as advance interest. There was no limit on the num ber of computers an individual might receive as long as a $8,444 deposit was made for each. Although the num ber of new de posits attracted by the promotion was not overwhelming, the talk it created in Brazosport was, according to Ranelle Sharp, marketing officer. “Many people called to ask for more informa tion, she says. “I think we reinforced our image as a progressive bank. ” O th er popular in -lieu -o f-in te rest prem iu m s are th o se w ith outdoor themes. Jam es W . M cLaughlin, presi dent of F irst Citizens National, New port, N. H ., says that careful premium selection and planning helped to pro d uce satisfactory re su lts d uring a promotion his bank sponsored that fea tured rifles, made locally, as the pre- HOW WILL YOU DECORATE THIS CHRISTMAS?? NOW IS NOT TOO EARLY TO ORDER FROM t . BRONNER’S' [CfouMmai jW xAaUm] Frankenmuth.MICH featuring INTERIOR & EXTERIOR CHRISTMAS & ALL-SEASONS DECORATIONS for Brainerd, MN Free-standing display. Our engineers will custom design a display to enhance the architecture of your building. Color drawing and quote at no cost. Call collect or write today — DAKTRONICS, INC. Box 128 Brookings, SD 57006 Ph. 605/692-6145 TOLL FREE 800/843-9879 DAKT RC ONICS (exc. AK, HI and SD) IN TELEX 29-5013 DAKTRONCS BKNG D BG/10 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis CITIES MALLS STREETS BUSINESSES BUILDING FRONTS SHOPPING CENTERS BANKS& INDUSTRIES PARKS and LAWNS For a catalog, write to: Bronner's 25 Christmas Lane, P.O. Box 176 FRANKENMUTH, MICHIGAN 48734 Phone 517 652-9931 mium. Many of his bank’s depositors are employed at the arms factory, Mr. McLaughlin points out, so there was more than ju st the allure of a finely crafted rifle to bring in deposits. Many participants obviously felt they were helping out the local econom y, he says. Mr. M cLaughlin spent at least a year in examining the legal complex ities of using rifles as premiums as well as in te re s t p rep a y m en t ru les that could have affected the promotion b e fore he made the decision to proceed. Although he refuses to discuss in spe cific terms how successful the program was, he says that all the planning and work was worthwhile. • • Carnegie Course (C o n t in u e d f r o m p a g e B G /3 ) course. All the bank’s managers were given the option of taking the course and Mr. Grant says that when he ex amined the performance of the 20 who com pleted it, he realized those indi viduals would progress more rapidly than others. O ne of the bank’s most successful endeavors was offering the Dale Car n egie cu sto m er-relation s course to area automobile dealers. “W e picked up the full co st,” says Mr. Grant, “and all we asked was for the salesmen to think of us when talking about financ ing with their custom ers.” Two hundred forty salesmen from four counties took the course, and dealer business increased 71% during the following year. Mr. Grant esti m ates that about one-third o f that growth was a result of the Dale Carne gie training, and the rest was due to his bank’s “aggressive stance. W e called regularly on dealers and expanded our base to several surrounding counties. W e ju st kept knocking on doors.” A typical reaction to the course was expressed by an area Dodge dealer: “Thank you, C en tral C ounties, for having the forethought and confidence to give your dealers something that will be meaningful for the rest of their business lives.” C entral C ounties’ staff has grown from 70 to 376 since Mr. Grant becam e its president. Its assets have increased from $72 million to $572 million. “Our five-year average return on assets is 1.05% com pared with our national peer group average of .88% , says Mr. Grant. He estimates that the bank has spent about 1% of its operating income on the Dale Carnegie program “and it has paid dividends to us, our customers and our shareholders.” • • Hot-Air Balloon Promotes Bank Name Change D em onstrating its conviction that the new spirit and pride surging across Michigan is not hot air and celebrating a change of name, F irst of America Bank C orp., headquartered in Kala mazoo, released thousands of heliumfilled balloons over the state recently. Lucky individuals who retrieved the balloons simultaneously released from the company’s 28 locations could claim prizes ranging from $1,000 in cash to F irst of America T-shirts. First of America’s corporate symbol, a hot-air balloon, hovered above the company’s Crosstown Branch in Kala mazoo during cerem onies marking the change of name. Form erly, F irst of America affiliates w ere known by a variety of names. Now all banks in the system will be known as F irst of Am er ica Bank of whatever community in which they are located and will have the same corporate logo. The F irst of America logo is highly visible on the side of the hot-air bal loon which various affiliates planned to use in special promotions throughout the summer. The balloon, says D aniel WHY STORE MONEY IN A WAREHOUSE? o s i’ Spend less money storing data print outs! Belm ont’s Special Financial Kit binds printouts neatly in rugged 18 lb. Kraft “ Durafiles.” The special SlideLock Binders allow easy insertion of additional data. When full, merely lock permanently with lock nuts and use the top mechanism again and again. Kit w ill accommodate 50 binders. Includes covers, 6” posts and slide-lock mechanisms. As low as 50<t each in quantities. For further inform ation, write or call: First of America employees released 1,000 h e liu m -fille d balloons sim ultaneously from each of HC's 28 locations during promotion. R. Smith, HC president, is a symbol of First of America’s b elie f that M ichi gan’s economy is rebounding. BELMONT PLASTICS P.O .Box 4465 Anaheim, CA 92803 (714)999-1012 Suppliers of specialty products to major banks for over 30 years. CUMMINS: The Innovators in Money Systems! New JetCount® Currency/Document Counters. The new Model CA-4050 JetCount® is designed for branch teller counting applications. Count accurately at rates of 1,000 documents per minute. The CA-4000 JetCount® counts at rates of 1,200 per minute and is ideally suited for heavy-duty curren cy, check and food stamp vault applications. CA CUMMINS Branch Sales and Service. An added plus behind its quality equipment is the Cummins direct Factory Branch Sales and Service Network. 56 offices stocked with machines and parts inventories and staffed with factory-trained sales and service professionals all of whom are Cummins employees. Write or call for more information or to arrange for a demonstra tion of Cummins JetCount® Currency Counters or JetSort® Coin Sorters, or automatic coinrollers or coin counter/packagers. Cummins Branch Offices in your area: C U M M IN S -A L L IS O N C O R P . Corporate Offices/Factory 891 Feehanville Drive Mt. Prospect, IL 60056 (312) 299-9550 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Consult local Yellow Pages (“Coin & Bill Counting & Wrapping Machines ) or call Cummins Hotline for Factory Branch Office nearest you: 312/635-5499. BG/11 Personal Selling C o m es O u t of C lo set A s 'W ay to G o ' in M arketing A p p ro ach I T ’S NOT U N U SU A L to hear of individuals “coming out o f the closet in regard to their personal preferences, but lately banks and thrifts have begun to “uncloset” th e ir approaches to aggressive marketing tactics. And personal selling appears to be the key factor in the success of these institutions. “Since banks and thrifts offer essentially the same products and ap p roach o th e r d is c ip lin e s o f marketing in similar ways, person al selling provides bankers with their most potent weapon in the s h o o t-o u t for c u sto m e rs and dent/CEO. Many customers seem to prefer dealing with a human teller, he said, and there are those who gen u in ely fe a r d e a lin g w ith a machine. His conclusion, based on research thus far, is that the bank has to begin a new advertis ing campaign to sell a percentage of the as yet unconvinced public on the advantages of ATMs. Obviously, it’s important for a financial institution — especially one w ith th e n am e F r ie n d ly National — to display a sunny dis position to the public. Friendly National tests how friendly its cus- "Since banks and thrifts offer essentially the same products and approach other disciplines of m arketing in sim ilar w ays, personal selling provides bankers w ith their most potent w eapon in the shoot-out for customers and accounts." accounts,” says Roy Alexander, author of the book S e c r e t s o f C lo s in g S a les. Although Mr. Alexander thinks financial institutions have a long way to go b efo re th ey can be term ed proficient in the art of per sonal selling, the following round up of examples o f such institu tions’ attempts at this relatively new type of marketing attest to the p ro b a b ility o f m o re o f th e ir brethren coming out of the closet of marketing neglect in the fore seeable future. Friendly National in Oklahoma City regularly surveys customers by telephone and mail to d eter mine attitudes toward various op tions the bank is considering. The surveys have been useful in iden tifying locations for future branch es and determ ining w hether those branches should be full service or limited service. The bank’s cus to m e r sam p ling also re v e a le d reasons why more customers are n ot u sing th e A TM n etw o rk , according to Jim D aniel, presi- BG/12 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis tom er-contact personnel are by sending out individuals disguised as custom ers to grade bankers’ performance. E ach em ployee is given an opportunity to see the grader’s evaluation of his/her p er formance and to discuss the eval uation with a supervisor. Shortly after the program was started, the bank began to hear from custom ers who said they had noticed that bank p e rso n n el see m ed to b e friendlier, Mr. D aniel said. D eterm in in g how the public p erceives the bank and testing new services prior to introduction is especially important in this era o f bank deregulation, according to D onald I. M en efee, presid ent, University Bank, G reen Bay, Wis. University Bank recently started using market sampling techniques Mr. M enefee honed in his pre banking days as a m anagem ent consultant. He claims the bank is increasing its sales-success ratio as a result. “W e go out to sample and find out what people really w ant,” he said. “In the past, bankers have d eveloped new products, then walked away and wondered why they didn’t sell.” Mr. M enefee said he refuses to fall into the trap of adding services to match the competition. Offer ing a smorgasbord of 27 different items, only a few of which are real ly in demand, is fruitless in his opinion. University Bank is nar rowing its offerings to those the public seems to want, he said. F in an cial institutions are b e coming more adept at identifying particular market segments for the serv ices they offer. A popular ta rg e t th e se days is th e highbalance or “up-scale” customer. At United Missouri Bank, Kan sas City, high-net-worth custom ers are directed to Leone Park’s personal financial planning divi sion where they are accorded VIP treatm ent. Mrs. Park, an execu tive vice president, said that “not long ago our personal bankers didn t recogn ize our m ore up scale custom ers.” She contends that custom ers with a high net worth have finan cial needs that go beyond those of the average customer. Selling new serv ices to such cu stom ers re quires people trained to cater to those needs, she said. H er fourperson staff of trained executives will treat up-scale customers to a meal in the bank’s executive din ing room or visit the client at home if need be. M rs. P a rk ’s d ep artm en t has generated $50 million in current and future fees which she attrib utes to the year-old, up-scale cus tom er program. She said she an ticipates an even more stunning success record in the second year of the program. In addition to the fees directly attributable to the up-scale cus tom er program, Mrs. Park said that interacting closely with up scale custom ers and probing to uncover hidden financial needs FOR YOUR D IRECTO RS - TO HELP THEM HELP YOU No. 51 BUDGETING, FORECASTING and PLANNING No. 220 — AN INVESTMENT GUIDE For the Bank Director Every bank must know W H E R E it is going and HOW to get there! M anage ment should “ map the co u rse ,” but directors should play a role in e stab lishing goals. T h is m anual su p p lie s d ire cto rs with tools they need to steer bank policy in the best direction. C hapters help directors estab lish “ m issio n s” statem ents, trace sta g e s of a plan ning process. D etails HOW to per form financial planning . . . how to plan for new se rvices . . . how to “ fo recast.” T ech n iq u e s used by s u c c e s s fu l banks are included, along with sour c e s of information and a bibliography of references. In this 192-page manual, the author d is c u s s e s the merits of directors paying clo se r attention to bank in vestm ent policies. Poorly thought-out-and-executed investm ent p o lic ie s can p lace a b a n k ’s c a p ita l in je o p a rd y , p ar ticularly when a bank is forced to liquidate investm ents during a period of rising interest rates. Should the board “ intrude” upon m anagem ent prerogatives of the C E O in the adm inistration of the invest ment portfolio? Not at all, sa y s the author. However, a written policy, c a r e fu lly stru c tu re d aro un d the bank’s deposit and loan “ mix,” can be comforting during rising or falling interest rates. A s an aid to m anagem ent and the board, the author presents numerous in v e stm e n t and po rtfo lio m a n a g e m e n t p o lic y s ta te m e n ts presently in use by recognized wellrun banks. Price — $29.50 2-5 copies $26.50 ea. 6-10 copies $25.00 ea. No. 101 DIRECTORS . . . Selection Qualifications, Evaluation and Retirement. T h is 42- page m anual an sw ers key q u estion s concerning director se le c tion, retention and retirement. Special section: the prospective director and how he should be expected to contri bute to the bank’s s u c c e s s . Includes a rating chart. Manual also co ntain s a section posing questions that a prospective director should ask him self before he a c c e p ts a bank board post. Another section d eals with the sen sitive nature of director retirement. Age can be a guide but not an over riding factor in this decision. Price — $24.00 2-5 copies $22.00 ea. 6-10 copies $21.00 ea. No. 230 — CONTRACTS WITH BANK EXECUTIVES In many banks, sa la rie s, bonuses and fringe benefits of top m anage ment are covered by contracts. S in ce many co ntracts extend for periods of five years they call for careful con sideration. This 48-page m anual d is c u s s e s the role of the board’s Com pensation Com m ittee in determining the nature of s u c h c o n t ra c t s . T h e au th o r su g g e sts that “ perform ance” can and should be the key in rewarding the executive. C h arts and w orksheets are included to help the comm ittee arrive at “ fair and equitable” pre requisites a s motivating factors for the bank executive. An aid to writing a NEW contract or in REV IEW IN G existing contracts. Price — $8.00 2-5 copies $7.00 ea. 6-10 copies $6.50 ea. No. 210 MAXIMIZING CORRESPONDENT BANK RELATIONSHIPS D irectors aren’t “ born correspon dent experts, but you can help them catch up in a hurry, and it’s profitable for you to do so. This 100-page manual covers all face ts of correspondent banking. C learin g s and float a n a ly sis . . . loan participations . . . lines of c r e d it . . . foreign exchange, etc. This manual also helps directors A P P R A ISE correspondent se rvices — to make certain you receive maximum service at a competitive price. The m anual also d is c u s s e s several federal regulations, including the con strain ts imposed on “ insider” bank lending by FIRA. A MUST for every bank director. Price — $14.00 Price — $10.00 2-5 copies $8.00 ea. 6-10 copies $7.50 ea. Please Send These Management Aids: 5 1 ___________ co pies $ ________________ 1 0 1 ___________ co pies $ ________________ 2 1 0 ___________ co pies $ ________________ 2 2 0 ___________ co pies $ ________________ Name _________________________ Bank _________________________ 2 3 0 ___________ co pies $ ________________ A d d ress ______________________ (In M issouri add 4.6% tax) 2-5 copies$12.00 ea. 6-10 copies$11.00 ea. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis The BANK BOARD LETTER 408 Olive Street St. Louis, MO 63102 Tax $ ________________ City ____________________________ TO T A L $ ________________ S t a t e _____________________ Zip _ sometimes results in a refreshing busi ness perspective leading to new profit opportunities. United Missouri is considering the addition of a new custom er service — the nature of which Mrs. Park did not wish revealed as yet — which was sug gested by one of the up-scale custom ers the personal financial planning di vision works with. The custom er came in with a problem that was somewhat beyond the realm of services the bank normally provides, but instead of offer ing m ere sympathy, a banker in the d ep a rtm e n t h ead ed by M rs. Park took a se e -w h a t-s h e -c o u ld -d o ap proach and came up with a solution. Impossible to read miniature confetti is the result when confidential material is destroyed by a powerful SEM Disintegrator. Tough enough to destroy unburst com puter output, crumpled paper, film on reels and fiche by the handful while automatically bagging and compact ing. One bag of SEM confetti equals five bags of shreds. For literature and sample call 800-225-9293 toll free. P U f l security engineered machinery 5 Walkup Drive, Westboro, Massachusetts 01581 (617) 366-1488 • Telex 951648 How a banker keeps borrowers going when he can’t say“yes' “I suggest BarclaysAmerican/ Business Credit.” Barclay8American/Bu8ines8 Credit, Inc. 1983 Your most solid source of loan business is from a healthy, growing customer. Yet there are times when a turndown is necessary. This is when Barclays American/ Business Credit can help, perhaps as no one else can. By analyzing your borrower’s accounts receivable, machinery and equipment, and inventory we can often discover asset values that may have been overlooked. When a customer requires fund ing for expansion, turnaround, acquisition or B a rd a v s refinancing we ATTIp n ^ l l can lend a hand, B usiness Credit either sol ely or An....... r jE s s m “ I * “ ™* in. Participation with you. C all 1-800-BARCLAY O ffices located nationw ide. Corporate H eadquarters: 111 Fou nders Plaza, E ast H artford, CT 0 6 108 BG/14 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis W orking with up-scale clients re quires that kind of results-oriented co n cern , said M rs. Park. Such an approach seems to work, she added, because h er departm ent “has more clients than we can handle.” Leader Federal Savings & Loan in M emphis is another institution that has reaped the rewards of an aggres sive calling program targeted at corpo rate and high-balance customers. The thrift identifies prospects through its own files, Dun & Bradstreet records and follo w -u p on d ire c t-m a il r e sponses, according to Art Holtman, vice president/director of retail mar keting. In con tactin g h ig h -b alan ce pros pects, Leader Fed eral’s three-person business-developm ent staff attempts to discover what services the prospect is currently using and what services will be needed. Just letting customers know the range of services Leader Federal offers can help stimulate busi ness, Mr. Holtman claims. Some pros pects are surprised to learn that the thrift offers a brokerage service, for example. Recruiting aggressive sales person nel for the business-developm ent de partment isn’t difficult, but the same can’t be said for all segments of the institution, he added. Some people within the association and its branches have responded well to sales training and sales-incentive programs, he said, but for others, adapting to an era re quiring a more aggressive sales ap proach has been traumatic. “Most of them w ere not hired in that mode, he said. “A lot of people come to work in an S& L because it’s a warm, fuzzy place to work. I f they w ere aggressive salesm en, they probably would be in another position. Leader Federal is planning to step up its telem arketing efforts and will train or hire aggressive sales people for that program, Mr. Holtman added. In an effort to stimulate more ag- gressiveness among its branch bank ers, Norwest Corp. this summer initi ated a program it’s calling “Operation Asset G row th.” Bankers are being en couraged to solicit business over the telephone and those who perform suc cessfully are rewarded with “O pera tion Asset Growth” T-shirts and publi cized in a new, system-wide new slet ter. The special T-shirts are not som e thing a banker could buy. “You have to earn o n e,” said Ted Novak, a manager in the retail banking division of Norwest’s Minneapolis headquarters. Many people have no concept of the range of things for which it’s possible to borrow from a bank, Mr. Novak said. To help correct that shortcoming, Nor west has written “canned” telephone solicitation messages that its bankers can use to promote loan services. The messages, Mr. Novak said, are digni fied, friendly and instructive. “W e don’t want to come across like aluminum-siding salesm en,” he said, “but we do want to call and tell people that we’re from Norwest Bank and we have money to len d .” The success stories are ju st begin ning to roll in. Mr. Novak cited the case of the loan-department personnel at the Sioux Falls, S. D ., branch who visited the local county courthouse and copied the names of everyone who had borrowed money at a rival institution 18 months earlier to purchase an auto mobile. Everyone on the list was contacted and reminded that interest rates had dropped and that it might be time to refinance. The result was a 40% suc cess rate and $150,000 in new loans generated within two weeks, accord ing to Al Hodgson, vice president/ com mercial-banking manager. Nor are auto loans the only targets at which N orw est’s Sioux Falls loan officers have taken aim. Almost any loan fi THE FINANCIAL BUYERS GUIDE is published semiannually by Commerce Publishing Co. 408 Olive St., St. Louis, M0 63102 314/421-5445 EDITORIAL STAFF Ralph B. Cox — Publisher Jim Fabian — Editor Rosemary McKelvey — Senior Editor Advertising Production Dept. Marge Bottiaux, Manager 408 Olive St., St. Louis, M0 63102 314/421-5445 Other Commerce Publications: Mid-Continent Banker, The Bank Board Letter, Amer ican Agent & Broker, Club Management, Decor and Life Insurance S e l l i n g . ____________ _________ https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • Sev eral aw ard-w inning financialinstitution promotional activities are among 60 case histories from more than 40 different industries included in an “Incentive Casebook published re cently by National Premium Sales E x ecutives (N PSE). Copies are available from N P SE , 1600 Route 22, Union, NJ 07083 at $39.50 each, postage paid. nanced when interest rates w ere high is fair game and Norwest is “aggres sively pursuing” all leads, said Mr. Hodgson. Norwest has branches in many communities throughout South Dakota, he said, and the potential is “trem endous.” Mr. Novak said that most of Nor west’s customers have yet to becom e aware of the company’s more aggres sive posture. It will be at least a year before the awareness starts to settle in. W ithin a few months, however, people will begin to realize that it’s unusual to get a call from a banker offering to lend money, he added. • • CREATE THE RIGHT IMAGE First N ationw ide Savings, Barclays Bank, American Savings and Loan, and Harbor Bank have ATMs that express their unique identities. Hyde Park expertise contributed to that in d ividuality w ith custom -designed ATM Support Systems. Every Hyde Park ATM Surround Panel is custom-made. And our design staff is able to create a total image w ith cano pies, service counters, kiosks and interior equipment. More clie n ts are First Interstate Bank, Golden State Sanwa Bank, First Federal Savings and Loan, Independence Bank, Pomona First Federal Savings and Loan, and Farmers and Merchants Bank. For literature and prices call co lle ct (213) 778-8479. Y D E 6820 Brynhurst Avenue Los Angeles, CA 90043 (213) 778-8479 *A R K rE T A L F A B , M C . The ATM Support Systems People BG/15 Bank Sponsors Program To Encourage Employees To D o V o lu n teer W o rk N IM P R O V E D quality of life for the people who live in its com munity is the goal of a communityinvolvement program now being spon sored by Union Planters C orp., parent of Union Planters National, Memphis. Inspired by governm ent cutbacks in social programs, the HC earlier this year put together an internal organiza tion that makes it attractive and easy for employees to do volunteer work in Memphis. O f course, many em ployees already w ere doing such work individually. However, UP wanted to organize all such efforts in a way that recognizes — and rewards — em ployees and, in cidentally, produces community good will for the bank. The UP program is called IM PA C T (In d ivid uals M aking P ro gress and Changing Tomorrow). To take part, an employee must devote a portion of his/ her time and talent to one or more of the city’s many charitable causes and com m unity projects. The em ployee can volunteer to help the sick, elderly or underprivileged, work on a project involving the arts, sports or education, on a telethon, make a speech or serve on a civic board. H ere’s the reward: As an IM PA C T mem ber, a UP em ployee may earn up to five extra vacation days a year. One point is awarded for every volunteer hour worked. An accumulation of 25 points constitutes an extra vacation day. T h e em p lo y ee also gets first chance (before other em ployees) at free passes and tickets to various com munity events as they are made avail able to the bank. In addition, special plaques and certificates are given IM P A C T m e m b e rs for o u tsta n d in g achievem ent, and each year’s most outstanding m em ber will receive spe cial recognition at IM P A C T’S annual awards feast. In addition, a p articip atin g em ployee may gain special recognition in U P ’s com pany publication, P ro file , and in IM PA C T’S monthly new sletter. A BG/16 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis T a k in g P a r t . Any in terested em ployee completes a short application form , and th e n m e m b e rs h ip is awarded on completion of one project. The em ployee may choose from among any of the bank-sponsored or bankendorsed community projects. Once an em p lo y ee is a cc e p te d , his/her membership is renewed annually on completion of 10 hours o f volunteer work during the calendar year. Among projects available for volun teer work are the M emphis in May B a r b e c u e , O k to b e r fe s t, A d o p t-aSchool, C otton C arnival, M arch of D im e s W alk and D a n n y T h om as Memphis G olf Classic. The program was kicked off January 27 with a 5:30 p. m. “Happy Volunteer Hour” at the Racquet Club. Similar hours are held every quarter at various locations throughout Shelby County. Sites could be bank branches, country clubs where Union Planters officers have memberships, etc. There are re freshments, and those attending have During kickoff speech that introduced Un ion Planters of Memphis' IMPACT volunteer program for employees, Richard A. Trippeer Jr., pres, of bank, holds up special license plate. Employees taking part in IM PACT received these plates for display on their cars. a chance to sign up for new projects and to exchange information with one another on what they are doing in volunteer work. These get-togethers also provide op portunities for em ployees to develop friendships with others outside their own departments or divisions. By the way, attendance at these hours counts one hour toward the required 10 hours for IM PA C T membership. Information on IM PA C T is dissemi nated primarily through the monthly n e w s le tte r , ca lle d IM P A C T -A GRAM. This new sletter lets people know about projects approved for the program, results of various drives in which employees participated and in formation on whom to call if an em ployee has any questions about the program. In b e tw e e n p u b lic a tio n o f th e m o n th ly n e w s le tte r, if so m eth in g com es up that needs attention im mediately — perhaps an em ergency drive of some kind — a project coordi nator for the proposal is chosen, and he/she goes over the project and then contacts IM P A C T m em bers to see w hether they would be interested in working on it. A weekly flyer update also gives in form ation on any p ro je c t n eed in g volunteers immediately. An em ployee working on his/her first volunteer project receives either a golf shirt or a white oxford cloth shirt (depending on what is appropriate for the type of activity in which the em ployee is involved). These shirts have the IM PA C T logo em broidered on the front, thus identifying their wearers and Union Planters and, as a brochure on IM PA C T says, “symbolizing the shared com m itm ent to the betterm ent of the city and county.” E a ch IM P A C T m em b er also re ceives a colorful (green and blue letters on a white background) license plate for the front of his/her car. Copy on the p la te read s, “ U nion P la n ters IM (C o n t in u e d o n p a g e B G /1 8 ) Four Fact-Filled Manuals for The Bank Director Every Director Should Have a Copy of Each One BOARD REPORTS . . . for The Bank Director $24.00 M o re e ffe c tiv e b o a rd m e e tin g s b e g in w it h e ffe c tiv e re p o rts . T h is 2 0 0 -p a g e m a n u a l w ill h e lp y o u d e te rm in e th e " q u a n t it y and q u a l it y " o f m o n th ly re p o rts needed b y d ire c to rs so th e y (a n d m a n a g e m e n t) can m a ke p ro p e r d e c is io n s . In c lu d e d are e x a m p le s o f re p o rts m o s t needed b y d ire c to rs w h o w a n t t o cre a te p o lic ie s t h a t lead t o p r u d e n t m a n a g e m e n t. C o n ta in s in fo r m a t io n o n m a n y to p ic s such as e ffe c tiv e re p o r tin g . . . re p o rts t o s h a re h o ld e rs. . . r e p o r t o f e x a m in a tio n . . . b a n k liq u id it y and c a p ita l a n a lysis. M a n u a l illu s tra te s v a rio u s fo rm a ts b o a rd re p o rts can ta k e . . . fr o m o ra l t o d e ta ile d g ra p h ic p re s e n ta tio n . A u t h o r : D r. L e w is E. D a vid s. PLANNING THE BOARD MEETING $8.00 T h is 6 4 -pa ge b o o k le t p ro v id e s som e w o r k a b le agenda, sug ge stion s f o r advan ce p la n n in g an d also lis ts ty p e s o f re p o rts a b o a rd s h o u ld rece ive m o n th ly and p e r io d ic a lly . I t e m p ha sizes th e need f o r in fo r m in g th e b o a rd as quickly and c o n c is e ly as po ssib le. C o n ta in s a c h a p te r o u t lin in g a " w o r k a b le " b o a rd m e e tin g , a n o th e r o n visu al aids f o r th e b o a rd m e e tin g . A ls o c o n ta in s a m o d e l f o r m in u te s o f th e b o a rd , p lu s sam p le fo rm s to c o m m u n ic a te sta tu s o f b a n k to th e b o a rd . A n e x c e lle n t " c o m p a n io n " t o BOARD REPORTS. A u t h o r : D r. L e w is E. D a vids. EFFECTIVE SHAREHOLDER MEETINGS $14.00 B e fo re y o u r n e x t s h a re h o ld e r m e e tin g , g e t re a d y f o r g a d flie s , a c tiv is ts and o th e rs w h o m a y be p la n n in g t o d is r u p t y o u r p ro g ra m . H e re 's h o w t o a n tic ip a te d a m a g in g in c id e n ts , p re p a re te s te d co u n te rm e a s u re s , t u r n p o te n tia l d isasters in to a p lu s f o r y o u r b a n k . D e ta ils in c lu d e h a n d lin g o f u n u su a l a c tio n s (such as re p la c in g a C E O ) — p o litic a l c o n tr ib u tio n s , law s and re g u la tio n s d ire c to rs m a y u n w it t in g ly b re a k , s to c k pu rcha ses, sales an d d isclo su re s, p r o x y p ro v is io n s , e tc . A c h e c k lis t o f m e e tin g d e ta ils . P ro m o tin g a tte n d a n c e . S to c k h o ld e r p ro p o s a ls . M a te ria ls to m a il. A g e n d a and p ro c e d u ra l ru le s .T h is b o o k is a t e s t e d " h o w - t o " o f A n n u a l M e e tin g s f r o m in c e p tio n t o fin a l re p o rts , in c lu d in g p e rs o n n e l re s p o n s ib le f o r each step . 9 6 pages o f " m u s t " re a d in g f o r c h a irm e n , d ire c to rs and o ffic e rs in v o lv e d . RESPONSIBILITIES OF BANK DIRECTORS $9.00 T h is b o o k is " r i g h t " f o r to d a y 's b a n k in g p ro b le m s . D u e t o th e e c o n o m ic in flu e n c e ba n ks have o n t h e ir c o m m u n itie s , th e ra p id g ro w th o f HCs and th e e v e r-g ro w in g " c o n s u m e r " m o v e m e n t, d ire c to rs m u s t k n o w w h a t is e x p e c te d o f th e m and th e ir b a n k in te rm s o f re s p o n s ib ilitie s t o d e p o s ito rs , s h a re h o ld e rs and th e p u b lic . T h is m a n u a l e xa m in e s re c e n t c o u r t d e c is io n s , in v e s tm e n t re tu r n , c o n t in u it y o f m anage m e n t, lo n g -ra n g e p la n n in g , e ffe c ts o f s tru c tu ra l changes o n c o m p e titio n , and m o re . A u t h o r : R a y m o n d V a n H o u tte , p re s id e n t, T o m p k in s C o u n ty T r u s t C o ., Ith ic a , N Y . The BANK BOARD Letter 408 Olive St., St. Louis, MO 63102 QUANTITY PRICES Board Reports Planning The Board Meeting 2 - 5 ....................... $22.00 ea. 2 -5 ....................................$7.00ea. 6 -1 0 ..................... $21.00 ea. 6 -1 0 ....................... $6.50 ea. Over 1 0 ..................$20.00 ea. Over 1 0 ................. $6.00 ea. Please send: ------- copies, Board Reports ------- copies, Planning Meeting ___ copies, Effective Shareholder Meetings $- ____ copies. Responsibilities of Directors $. ____ Total Enclosed $. Name & T it le _______________________________ Effective Shareholder Mtgs. Responsibilities of Directors 2 -5 ................................. $12.00 2 -5 ................................. $8.00 6-10............................ $11.00 6 -1 0 ................................. $7.00 Over 1 0 ..................... $10.00 Over 1 0 ....................... $6.50 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis B a n k _______________________________________ S tre e t________ C ity, State, Zip (Please send check w ith order. In Missouri, add 4.6% tax.) BG/17 BEEMAK MOLDED HOLDERS For point of purchase sales drafts, credit card appli cations and ad material. Free standing or wail mounted styles. Racks made from any holder with any number of pockets. BP200 Call our Toll Free number (800) 421-4393 Dozens o f shapes and sizes available. Silk screening i f desired. W rite fo r inform ation. SINC E 1951 B E E M A K MP L A S T IC S 7424 Santa Monica Boulevard Los Angeles, Ca. 90046 • (213) 876-1770 PA C T .” How’s the program doing? Accord ing to Nicky Schrein, assistant vice president/public relations manager, “The employee response to IM PA C T has ju st been phenomenal, and the timing couldn’t be better. There are so many groups that are crying for the kind of volunteers Union Planters now will be able to provide.” Ms. Schrein says about five to 10 employees request applications each week, and, as of this writing, 350 had volunteered their services. Ms. Schrein also points to some spe cific projects in which IM PA C T m em bers have worked. The first p ro ject under IM P A C T was carried out February 23. Twentyeight mem bers worked hard making phone calls and taking pledges for the Memphis Arts Council fund drive. In th a t one n ig h t, IM P A C T ra ised $4,415. According to the new sletter, this was more money than was raised by any other bank participating in the fund drive. On April 24, 100 volunteers from UP took part in the March of Dimes Walk America. The walk was 17 miles long, and IM PA C T volunteers turned in pledges totaling $5,000. Union Planters has had an Adopt-aSchool program for some tim e, and IM PACT Information Anyone interested in starting a program like IMPACT in his/her bank should contact: Nicky Schrein, assistant vice president/public rela tions manager, Union Planters Corp., P.O. Box 387, Memphis, TN 38147 (901/523-6736). Ms. Schrein says she will be happy to discuss the program with bankers in other cities. IM P A C T has g iv en it a b o o st. A lth ou g h th e v o lu n te e r prog ram didn’t start until the end of January, the school program last fall attracted plenty of UP employees. They knew IM PA C T was coming and wanted to work in the school project as their part in IM PACT. Under this program, UP employees work for a M emphis junior high school in fund-raising efforts (uni forms for teams, money for bands), as chairpersons of academic, athletic and music committees. As part of this school program, on M arch 25, 40 IM P A C T volunteers played in volleyball and basketball games to help raise money for the adopted school. IM PA C T volunteers raised $275 for the school. The program has attracted the atten- O VER 4,000 FIN A N CIA L IN STITU TIO N S C O A S T TO C O A ST , HAWAII & A LA SK A ARE RECEIVING ONE-DAY TURN-AROUND ON THEIR PAYMENT BOOK REQUEST T H A T ’S R IG H T ! Over 95% of the work coming into our o p e ratio n in B irm in g h a m , A la b a m a is completed and in the mail within one working day. Call or write us today. Ask about our company, our people and our service level. Let us meet with you to d iscu ss your payment book needs. We are the P A YM EN T BO O K SP EC IA LISTS. • • Installment or Mortgage Loans Superior MICR or OCR Print Quality • • Guaranteed Service Level With Penalty Extended Price Guarantee • We Specialize in Payment Books • Excellent Range of Product Options • Highest Level of Technical Expertise and Flexibility Data Transmission • FOR A D D IT IO N A L IN F O R M A T IO N Contact: G ary Aderhold, C D P Vice-President/Sales NATIONAL COMPUTER PRINT, INC. 1001 - 15th Way S.W. Birmingham, Alabama 35211 205/925-3592 PAYM ENT B O O K SPECIALISTS BG/18 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis © B A N K E R S TRU ST Installment Loan Coupon Book tion of M emphis media. UP rep re sentatives have appeared on local TV statio n s to d iscu ss IM P A C T , and newspapers also have devoted space to it. The project is run by an advisory board headed by Richard A. Trippeer Jr., president of the bank, and consist ing of five other staff m em bers, includ ing Ms. Schrein. This board evaluates com m unity needs, organizes volun te ers for p ro je c t in v o lv em en t and oversees IM P A C T ’S day-to-day ad ministration. Mr. Trippeer says one o f the reasons behind formation of IM PA C T is that the bank constantly is asked to furnish people for civic and charitable pro grams. W ith IM PA C T, Union Planters is doing it in organized fashion. In addition to sponsoring IM PA C T, Union Planters continues contributing money to events and causes, as it has done in the past. As Mr. T rip p eer puts it, “Union Planters always has been generous, but now we want to give even more than money. W e want to give people, m em bers of IM PA C T, whose work can make a difference in the com m unity.” — Rosemary McKelvey, senior edi tor. Akron Bank Targets Everyone During New Marketing Effort Centran Bank, Akron, is stressing the fact that it is a bank for everybody. The bank initiated a new marketing campaign recently. T h em e of the campaign, “E very body’s B ank,” is being emphasized in radio, TV and billboard advertising. T h e cam paign, says C E O Alan G. Brant, is designed to help Centran stand out amid the competition. “L e t’s face it, most of the products and services we re able to offer in a tightly controlled and regulated en vironm ent are at a parity with what our competitors are able to do or say,” Mr. B ra n t says. “To be su ccessful, it’s necessary to stand out from the com petition.” Centran is attempting to show the public that it tries to relate to its cus tom ers’ individual needs. “In short, we try to be ju st as excited about the young married couple who needs a crucial loan for a new home as we do about th e established businessm an who wishes to open a $25,000 moneymarket account,” Mr. Brant says. “The new campaign says simply and clearly that whoever you are, whatever you do, and w herever you are going, Centran Bank is interested in you,” notes Ron Campana, president of the advertising agency that developed the https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Grandma's Master® Iw erybody§ an! Fruit Cake® Whoever you are. Whatever you do, And wherever you're going., coday an d tomorrow. There’s really only one Akron bank that's right for every body. Centran Bank. We’re out to be everybody's bank. And we mean everybody. And we meanym. A lot of other banks spend a lot of time and money telling you just how great they arc. We're taking a different approach. \Xb at Centran want you to knowjust how great we thinkyrn are. And how much your business means to us. And how hard well work to get your business— and to keep it. Whatever you need from a bank, you’ll fi nd at Cc ntran. More service. More convenience. More people who really care about you. We think everybody in Akron is ready for everybody's bank... don’t you? FREE FRUIT CAKE SAMPLE Centran new them e for Centran. T he campaign was unveiled to more than 300 Centran employees at a spe cial breakfast meeting that featured a “live” presentation of the campaign music performed by 16 m em bers of the orchestra, the singers of the jingle and even a spontaneous au d ien ce wrap-up. FOCUS ON Grandma’s Master® Fruit Cake® is truly a fruit cake different from all other fruit cakes. Our fruit cake has no citrus peel, or heavy spices. Grandma’s Master® Fruit Cake® makes a wonderful Executive gift for the Holidays. A gift you will be proud to give. We do individual mailings or have special prices on larger orders. Write now for your free sample. Samples will be sent through December of 1983. GRANDMA’S MASTER® FRUIT CAKE® P.O. BOX 457 BEATRICE, NE 68310 (800) 228-4030 SERVICE SPEED PRIVACY EFFICIENCY Single Line Teller Service Complimentary Floor Plan Immediate Delivery Counter Brochure Racks • Many Designs Available • Custom Manufacturing — Quantity Discounts pm MANUFACTURERS INSTALLATIONS INDUSTRIES, INC. • Finest Quality—Fully Guaranteed 1400 TENNESSEE ST. SAN FRANCISCO 94107 415-641-1400 Send For Our Brochure Today BG/19 nate that resists stains. For more in fo rm a tio n , c ir c le 60 on R e a d e rResponse Card. New Products and Services • Harland. ColorCovers® is the name o f a new series of three-ring check binders with covers featuring a photo like finish. They’re available in four • Brandt. This firm has introduced a new model 879 currency scale, de signed to count and/or verify currency in conjunction with any Brandt cashsettlem ent system. The scale verifies full or half straps, at which time the sc e n e s — M illP o n d ® , M o u n tain V illa g e ® , C and y C o u n te r ® and Stream ers® . Each cover is protected with a w aterproof polyester film lami- NEW ÎS 2 CONSUM ER LENDING P O LIC Y T A Manual for Directors, Management and Lending Officers By Dr. Lewis E. Davids 200 Pages $25.00 Bank directors don’t get in volved in consumer lending, per se, but they do get involved in for mulating consumer-lending policy. In order to formulate such policy intelligently, they MUST be familiar with the broad scope of consumer lending as well as the pitfalls such lending can hold for a bank. Dramatic increases in personal bankruptcies call for new policies in the consumer-lending area. State usury laws are being revised or preempted by federal statutes. Existing “ rule of thumb” lending practices aren’t always valid in to day’s changing environment. This 208-page manual includes an array of consumer loan policies in force at various-sized banks, provides checklists of topics on in stallment-credit policy and proce dures and policy components; model application forms; an over view of the Federal Reserve’s con sumer regulations; the Federal Reserve Functional Cost Analysis of the installment-loan function; in stallment-loan department plans; consumer-credit terminology, and bibliography of reference mate rials on installment loans. Save! Send check with order. THE BANK BOARD LETTER 408 Olive St., St. Louis, MO 63102 1 Copy @ $25.00 _______ 5 or more @ $20.00 e a :________ Consumer Lending Policy system will indicate w hether the straps are correct or in error. The unit also counts cu rren cy, acting as a piece counter. For more information, circle 61 on Reader-Response Card. • Florida Software Services. This firm has introduced a new concept in data-collection procedures called In te grated Transaction M anagement Sys tem Extended (ITM S). The system offers bankers a degree of control over float and item flow, making item proc essing a profit-boosting aspect of daily banking operations. The system uses an electronic courier feature that auto m atically gen erates on-line reports from the bank at which the items are p ro c e s s e d , m in im iz in g d o cu m en t handling and delays and expenses associated with traditional courier ser vices. Operating on IB M hardware, ITM S permits a bank’s non-technical p e rso n n e l to c re a te and m aintain check-sort patterns, end points and statistical reports, on-line and without extensive training. For more informa tion, circle 62 on Reader-Response Card. • Littlewood, Shain & Co. This firm’s check-services model is available in a new micro-com puter version for use with the IB M PC-XT. The system is designed to stimulate the impact on bank profitability o f changes in the ch eck -clearin g environm ent. Banks can use the model to maximize funds availability while minimizing clearing costs and analyzing nearly every aspect of their check product. For more in fo rm a tio n , c ir c le 63 on R e a d e rResponse Card. N a m e .........................................................................................T i t l e ......................... • Cummins-Allison Corp. This firm Bank has a new CA-4050 JetC ount currency counter that counts up to 1,000 bills per minute. The unit was designed for use in the teller area or branch loca tion. The most commonly used batch .............................................................................................................................. S tre e t.............................................................................................................................. City, State, Zip ............................................................................................................ BG/20 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cial deposit bags and large deposit en velopes that ordinarily would be too large for a regular ATM deposit draw er. For more information, circle 67 on Reader-Response Card. • Omega has introduced the asset- amounts are preprogrammed into the unit, enabling an operator to call them up at any time by pressing the batch key. It features an automatic restart that automatically feeds bills into the machine when the previous count is removed from the stacker. F o r more in fo rm atio n , c irc le 64 on R ead erResponse Card. • Diebold. This firm has introduced conversion-cycle workshop, a sevensession training system that teaches cash flow and accounting skills from the commercial lender’s perspective. The system focuses on skills lenders need to “see behind the num bers” on b o rro w er-fin a n cia l sta tem e n ts, ac cording to Omega. It helps them learn how to track cash flow, evaluate finan cial-statem ent quality and make b etter commercial-loan decisions. The work shop is offered in in-bank and public, open-enrollm ent formats. Banks offer ing in-bank programs send trainers to w orkshop -lead er train in g sessions; o p e n -e n r o llm e n t w o rksh o p s are offered at selected locations across the nation. For more information, circle 68 on Reader-Response Card. th e D iebold T e lle r Assist Software (DTAS) package, which operates as an application program in an IB M 3600/ 4700 financial controller to support the D iebold TABS® T eller Assist cash dis penser. The package performs an in terface function betw een the cash dis p en ser and existing te ller term inal software and allows the dispenser to be shared by two operators concurrently via separate IB M terminals. For more in fo rm atio n , c irc le 65 on R ead erResponse Card. product is said to be an ideal gift for financial institutions to give to special customers during the holiday season. The fruit cake recipe was discovered in St. Louis in 1917 by two brothers whose father had brought it from G er many and hidden it away. Cakes con- Choose among 7 cart & wagon models Antique Popcorn W agons — the goodwill builders The proven p.r. tool. Sell it at your bank or S & L at 75% profit ...or give it away at 4C per serving. Contact Gold Medal, the nation’s leading manufac turer of funfood equipment, 1-800-543-0862. GOLD MEDAL PRODUCTS CO. 1861 Freeman Ave. Cincinnati, OH 45214 513-381-1313 • Actron, Inc. A new ATM monitor provides an in exp en siv e m eans of checking on the operation of an ATM at a location convenient to the person • Grandma’s Master Fruit Cake. This Workshop p articip an ts receive th ree volume set of materials. J G U ID E Y O U R C U ST O M ER S TO T H E FA S T E S T S E R V IC E A V A IL A B L E WITH responsible for its maintenance. The unit is 2" high x AVz wide x 5V4" deep. F or more information, circle 66 on Reader-Response Card. • ATM Network Management Corp. The SATM Systems Division has re introduced a subsystem product that en ables SATM System s to provide support for the D iebold Stand-Alone Securom atic After-Hours Depository. In sta lled next to a D ieb old TA BS ATM , the depository accepts commer https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C U ST O M ER S A U T O M A T IC A L L Y S IG N A L T H E IR A R R IV A L WITH DRIVE-IN ALERT Pleasant chime sounds when car passes over electronic detection area, alerting tellers who may be away from drive-in w indow . Customers receive fast service. Tellers operate more e ffic ie n tly . Also counts cars. Ilip, HIGH INTENSITY DRIVE-IN SIGNS AC TR O —LITE SIGNS im m ediately attract and direct drivers entering the fa c ility . The e xtraordinarily b rillia n t OPEN/CLOSED or RED /G REEN message even pierces direct sunlight. Stainless steel or statuary bronze finish. Easily installed and m aintained. Versatile m ounting. Im mediate delivery. Satisfaction Guaranteed! 1351 Jarvis Ave., Elk Grove Village, IL 60007 (312) 398-0633 BG/21 tain no citron, peel, prunes, other fill ers or heavy spices. M oisture comes from natural juices of fruits and nut- meats and other ingredients. For more information, circle 69 on Reader R e sponse Card. Bank's Photo-Restoration Service Results in Considerable Good Will T A T T E R E D photographs of great FR E E S an ta rings If you ’re con sid erin g a Ch ristm as giveaway item to spread good will during the 5 to 6 weeks before Ch ristm as, then our Santa Claus ring is worth investigating. It is molded in 3 colors, adjusts to fit any size finger and c o s t s only each. Minimum order is only 1 , 0 0 0 pieces. Also available are Red,White & Blue w h istles, Duck Calls, Old Fashioned Train whistles, Bubble Pipes, Trivets and E aster Bunny rings. Free brochure and samples on request. WILSON PREMIUM CORPORATION Box 30185 Memphis,TN 38130 Phone (9 0 1 )3 4 6 -8 8 0 3 grand m oth er and irrep la cea b le but yellowing news clippings w ere re stored to like-new quality, not at a photograph studio, but at a bank in Fort Oglethorpe, G a., during a recent promotion. The event brought in a “very satis factory ’ group o f more than 200 cus to m ers d uring its w eek -lo n g run, according to K en n eth C. W iggins, adm inistrative officer at F o rt O gle thorpe State. Mr. Wiggins calculated that the 200 people who showed up with damaged photographs and other similar priceless heirlooms to be re stored rep resen ted about a 6% re sponse to a letter the bank enclosed with custom ers’ monthly statements. The letter described the photographrestoration service and when it would be offered. Customers paid $59.95 for the original restoration work and then received a reprint — normally priced at $19.95 — at no additional charge. E xcept for the letter and some “inhouse” promotion of the service, there was no cost to the bank, according to Mr. Wiggins. The bank did not spon sor the event to derive income, but primarily for promotional purposes. C ustom ers had not yet receiv ed their restored photographs when Mr. Wiggins was interviewed, but he said that photograph restoration appeared Y o u r S p e c ia lis ts In F in a n c ia l A d v e rtisin g for 3 0 Y e a rs . F Q Q FINANCIAL ADVERTISING AGENCY 100 CRISLER AVENUE FORT MITCHELL, KENTUCKY 41017 606-331-4940 BG/22 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis to fill a legitim ate need and created considerable good will. Fort Oglethorpe State invited cus tomers to bring in any type o f photo graph they wanted restored. Even a torn and faded new spaper clipping could be restored and preserved in any size desired, the bank’s letter to its customers stated. The original photo graph was returned on the spot so there was no need for concern about damage or loss. Why restore old photos and docu ments? To preserve family roots. To bring back memories. These and other reasons are prompting individuals to have old clippings, documents and photos restored professionally. Land titles, marriage certificates, cracked photos — they all have more historical and sentimental value when restored. They can he framed or mounted and then hung on walls in clusters to create a “museum” for one’s home or office. A professional restorer can do wonders with a battered photo or document, making the item worthy of display — and keeping fond memories alive! F o rt O glethorp e State has spon sored other promotional events in the past. During one such event, the bank gave away art prints to its customers. This was the first tim e the bank had ever offered to restore photographs, according to Mr. Wiggins. Bob Brown & Associates of Chatta nooga, T en n ., did the work on the photographs. T h e com pany set up shop in the bank’s boardroom and didn t intrude on other business opera tions. W e hardly knew they were there, Mr. Wiggins said. W hile it would be difficult to place a dollar figure on the value o f the event to the bank, Mr. Wiggins is confident th e p ro m o tio n was b e n e fic ia l. W henever customers who took advan tage of the service look at their re stored heirlooms, it is possible they will recall the fact that the bank made the restoration possible. • • Help Stamp Out Director Liability Risk With These Board-Related Manuals CORPORATE ETHICS . . . What Every Director Should Know. $24.00 Society is demanding more disclosure from all businesses, including banking. Thus, bankers literally are forced to re-exam ine policies on types of information that can be disclosed publicly. The board's disclosure policy can be a major factor in the public's judgment of a bank. The fact that a bank is willing to discuss . . . or make public . . . any of its actions will encourage high stan dards of conduct by the bank staff. This manual (over 200 pages) will help directors probe "grey” areas of business conduct so that directors can establish written codes for their own bank. $24 What Every Director Should Know About Conflicts of Interest The Effective B o a rd Audit Ar D tnc-n mmd O ffice ./ Ftmmmeimi /in— «».i CORPORATE ETHICS BOARD By. RISK MANAGEMENT BANK BOARD $20 LOAN POLICY $18.50 B e --- QUANTITY PRICES 2 - 5 copies — $22.00 ea. 6-10 copies — $20.50 ea. BOARD POLICY ON RISK MANAGE MENT. $18.50. This 160-page manual provides the vital information a board needs to formulate a system to recog nize insurable and uninsurable risks and evaluate and provide for them. In cluded are an insurance guideline and checklists to identify and protect direc tors against various risks. Bonus fea ture: A model board policy of risk management adaptable to the unique situations at any bank. Every member of your bank's board should have a copy! QUANTITY PRICES 2 - 5 copies — $16.50 ea. 6 -10 copies — $15.50 ea. THE B THE BANK BOARD AND LOAN POLICY. $14.00 (Fourth Edition) Recently off the press! This revised and expanded manual enables directors to be a step ahead of bank regulators by providing current loan and credit poli cies of numerous well-managed banks. These policies, adaptable to any bank situation, can aid your bank in estab lishing broad guidelines for lending officers. Bonus feature: Loan policy of one of the nation's major banks, loaded with ideas for your bank! Remember: A written loan policy can protect direc tors from lawsuits arising from failure to establish sound lending policies! Order enough copies for all your direc tors! $14 CONFLICTS OF INTEREST. $14.00 (Third Edition) Conflicts of Interests presents everything directors and o ffi cers should know about the problem of "conflicts." It gives examiners'views of directors' business relationships with the bank, examines ethical pitfalls in volving conflicts and details positive actions for reducing the potential for conflicts. Also included is the Comp troller's ruling on statements of busi ness interests and sample conflict-ofinterest policies in use by other banks which can be adapted by your board. QUANTITY PRICES QUANTITY PRICES 2 - 5 copies — $12.00 ea. 6-10 copies — $11.50 ea. 2 - 5 copies — $12.00 ea. 6 -10 copies — $10.50 EFFECTIVE BOARD AUDIT. $20.00. This 184-page manual provides comprehensive information about the directors' audit function. It outlines board participation, selection of an audit committee and the magnitude of the audit. It provides guidelines for an audit committee, deals with social re sponsibility and gives insights on en gaging an outside auditor. It includes checklists for social responsibilities audits, audit engagement letters and bank audits. No director can afford to be without a copy! QUANTITY PRICES 2 - 5 copies — $18.00 ea. 6 -10 copies — $17.00 ea. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis THE BANK BOARD LETTER 408 Olive St., St. Louis, MO 63102 ........... co p ie s, B o a rd P o lic y o n R is k M a n a g e m e n t $ .............. ...........co p ie s, T h e E ffe c tiv e B o a rd A u d it $ .............. ...........co p ie s, B a n k B o a rd & L o a n P o lic y $ .............. ........... co p ie s, C o n f lic t o f In te re s t $ .............. ...........co p ie s, C o rp o ra te E th ic s T o ta l E n clo se d $ .............. $ ............. N a m e ...............................................................................................Title Bank.......................................................................................................... Street ....................................................................................................... City, State, Z ip ....................................................................................... (Please send check with order. In Missouri, add 4.6% tax.) BG/23 Systematics remote bankers have the line onbig bank DP https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Nationwide, de regulation and complex technological changes in the banking industry have created new, more intense competition. And for com munity bankers especially, a growing need for sophis ticated data processing has been created. Systematics Rem ote Services offers you the in dustry’s most comprehensive remote processing services at a competitive cost. You get the economies and efficiencies o f remote processing, plus the same proven Systematics services and software that have made us the nation’s largest and fastest growing bank data processing company. Systematics Rem ote Services gives you on-line access to banking’s most proven, flexible, and com prehensive set o f application software. We design our software. We maintain it. We update it So you can offer your customers the latest products and services. Plus, you get a company with the resources and experience to provide the data processing solutions you want for your bank. Systematics Rem ote Services. We can give you the line on big bank DP. Bank data processing is all we do. But we do it all. Facilities Management Software Services Remote Services ' ’ (*©*) a SYSTEMATICS, INC. 4001 Rodney Parham Little Rock, AR 72212-2496 (501)223-5100 A b o u t B a n k s & B a n k e rs ILLINOIS First Chicago to Acquire American National Corp. First Chicago Corp. has announced plans to acquire Am erican National Corp. from W alter E . H eller Interna tional Corp. American National Corp. owns American National Bank, C hica go’s fifth -larg est com m ercial bank. F irst of Chicago owns F irst National, Chicago’s second largest bank. The acquisition is expected to in crease F irst Chicago’s assets by $3 bil lion, to $38.8 billion. Plans call for American National to b e left intact and to be operated as a separate subsidiary of F irst Chicago. It will retain its name, staff and m arket ing thrust. A ccord ing to B arry F . Sullivan, chairman, F irst Chicago, the key in terreaction betw een the two firms will be at the strategic-planning level. He said he sees the combination as em phasizing the separate strengths of the two banks — F irst Chicago’s wholesale domestic and international lending op eratio n s, and A m erican N atio n al’s middlemarket penetration. As part of the purchase, F irst C hica go will acquire two suburban Chicago banks bought by American National Corp. as a result of foreclosures on debts owed by their previous owners. F irst Chicago paid $275 million for American National. David A. Kudo has been promoted to senior vice president/finance-division head at M erchandise National, C hica go. Mr. Kudo joined the bank as vice president-finance in Novem ber, 1981, having previously served as controller of W. N. Lane InterFinancial, Inc. Mary Anne Varland has joined First State Bank, Rockford, as marketing officer. H er duties involve advertising, customer service and marketing. Sears Bank, Chicago, has appointed Gordon Carlson as vice president of correspondent banking. Malvin A. Frischkorn, senior vice president/cashier, has retired from B elle v ille N ational. H e jo in ed the bank in 1949, was named an officer in 1962, vice president/cashier in 1977, and senior vice president/cashier in 1981. First National, B ellev ille, has pro m oted Thomas M. Blom e to co rre spondent banking officer. Previously, he had been consum er credit officer. He joined the bank in 1975. O ther promotions include: Owen M. Steinweg to vice president/data processing manager; E leanor M. Fohl to assistant vice presid ent responsible for IRA/ Keogh operations; Connie L. Knauss to assistant vice president/data proc essing and John Venarsky to consumer credit officer. Recently elected officers include: Kevin Fitzgerald, credit de partm ent manager; David Kelahan, assistant manager/credit card depart m e n t m a n a g er; B ra d K o e n e m a n , adm inistrative assistant; and Jam es Compton, consum er loan officer. C ontinental Bank, C h ica g o , has elected the following senior vice presi dents: John Bleveans, Jam es P. D ono hue, Steven G. Elliott, John N. Fix, Kevin Hallagan, R. Law rence Joh n son, John E. Neal, and D rew W aitley. Thomas S. Bagley was elected vice p r e s id e n t and P h ilip C . A dam s, W . Thomas B arnett and W illiam P. W asch le w ere nam ed second v ice presidents, all in the U. S. banking services department. In the financial services d epartm ent, W illiam Read was appointed vice president in capital markets; Richard C. Allen, second vice president in trade finance; and Richard J. Meliska, Catherine A. Schulze and MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Brenda C. Seliga, second vice presi dents in worldwide cash management. Gary W. Brown has been elected as sistant vice president/regional banking at Springfield M arine Bank. Previous ly he had been an assistant vice presi dent in commercial lending at Streator National. Harris Bankcorp., Inc., Chicago, has elected Daryl F. Grisham to its board. Mr. Grisham is president/CEO, Par ker House Sausage C o., Chicago. Drovers Bank, Chicago, has elected Thomas P. Carmody and Jam es M. Corkery vice presidents. Mr. Corkery has been with Drovers since 1979 as a credit analyst and later as a commercial lending officer. Mr. Carmody has been a commercial loan officer at both Main Bank of Chicago and Drovers Bank. INDIANA Rebecca J. Ravine, assistant vice pres id en t, Anthony W ayne Bank, F o rt W ayne, was among the winners of the National Association of Bank W omen, In c. (NABW ) education foundation scholarship award. The award is given annually to women bankers in each of the association’s nine regions. It covers registration, travel, room and board at any N A B W ed u ca tio n fou n d ation seminar. Terry J. Sanderson, CIA, auditor, In diana National, Indianapolis, has been elected central regional director of the Institute of Internal Auditors, Inc. Lincoln National, F o rt W ayne, has 33 p ro m o ted P h ilip B o n ah o o m and P. M ichael Schaub to assistant vice presidents. Mr. Bonahoom manages the W aynedale office and Mr. Schaub m anages two New H aven o ffices. Kevin W. G reiger has been promoted to trust marketing officer. David L. Fisher, vice president, Irwin Union, Columbus, has been promoted to senior trust officer. He has manage ment responsibility for the trust divi sion, inclu d ing op erations, in v est ments, tax and business development. MICHIGAN National Bank of Detroit has named Darrell L. Schlabach vice president in the eastern regional banking division. Named second vice presidents in other divisions w ere G regg D . W atkins, Richard O. M cG ee and V incent A. Vatalaro. New assistant vice p re si dents include John C. Carter, Jack E. M iller Jr., Kathryn M. Ritter, Jam es L. Imbeau, Francelle E. Fulton, Jo anne C. Schwartz, Richard L. H ennessy, Jam es D. P risk ey , W illiam S. Drawz, M ichael C. Kulwicki, Jam es B. Howbert, Claude R. Cornwell, Sandra K. Davis, Patrick P. Skiles, M argaret 34 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis R. C a rro ll, R o b e rt C . K u b e re k , Harold B. Benson, Robert V. Camp and Barbara T. Rende. M anufacturers Bank, D etro it, has p ro m o te d K e ith M . A lte n b u rg , C. Vance Borngesser, Douglas M. Kilbourne, Ronald F. Daum, Anthony.J. Polisano and Thomas E . Smith to vice presidents; named Marvin J. Elenbaas seco n d v ice p resid en t/ a cco u n tin g officer, and Mark W . Gilm er interna tional banking officer; and promoted Pamela Fahlund to marketing officer/ senior research analyst. W ayne W. Kring, senior vice president, retired last month after serving banking for 37 years. He had been officer-in-charge, Michigan banks division, since 1969. His successor is Patrick J. Callahan, who joined the bank as vice president recently. Michigan National Bank-North Met ro, Troy, has elected Alvin W ander to its board. He is senior vice president/ adm inistration and treasurer, Perry Drug Stores. Timothy M. Peters has been named president/C EO at F irst o f Am erica Bank-Bay Area, Sebewaing. He suc ceeds A. Edwin Baur, chairman/CEO, and Norman H. Schroeder, president, who have announced th e ir r e tir e m ents. M r. P eters jo in ed F irs t of America-M ichigan in 1961 and most recently was vice president/manager, Paw Paw Office. Dearborn Bank expects to com plete construction of a major renovation of its main office, com m ercial lending and branch banking areas within the Village Plaza soon. The renovation’s completion coincides with the bank’s 30th anniversary. MINNESOTA Loren D. Herbst, senior vice presi d ent, N orw est M idland, has b een elected president o f the M innesota chapter, R ob ert M orris Associates. E lected vice president was Robert L. Stehlik, president, F irst Bank Southdale. New secretary/treasurer is Phil lip J. Gallivan, senior vice president, F& M M arquette. E lected to the board were John F . Crinklaw, senior vice president, National City Bank, M in neapolis; Dale S. Hanson, executive vice president, F irst Bank St. Paul; and John C. Roise, senior vice presi dent, Norwest-Mankato. MID-CONTINENT BANKER for September, 1983 David E . Colburn, vice presid ent, Continental Illinois National, C hica go, has been given responsibility for the bank’s com m ercial lending in M in nesota and other nearby states, work ing out of the M inneapolis regional office. He has been with the bank for 24 years. Raymond D. Konz has joined Adrian State and its insurance agency. His prim ary duties are as an insurance salesman. First Bank Minneapolis has elected Gerald A. Kraut and Thomas E . Leary sen io r vice p re sid e n ts. M r. K raut heads a new capital markets/treasury group and joined the bank in 1973. Mr. Leary is head o f the cred it-ad m in istration departm ent and joined the bank in 1957. Promoted to vice presi d ents w ere F ran k lin L. B rosseau , Grant R. Christenson, Mary Ann Han sen and M ary E . K o essel. Newly promoted to assistant vice presidents were William J. Swanstrom, Karen M. Paris, Jeffrey F . F ig gatt, Nancy J. Johnson, Thomas H. Cherry, David G. Guimond, Susan L. D rake, Gary N. Ophaug, Jo Ann S. G elbm ann and Linda L. Gross. New to the bank are vice presidents W illiam R. Cook and John D. Gatzlaff. Richard B. Huart, Beth Ann D inndorf and Jack L. Haus er have joined the bank as assistant vice presidents. John W . Schwegal has been elected vice president, financial-institutions group, Norwest C orp., Minneapolis. He helps develop strategies and pro gram s for th e H C ’s fin a n c ia linstitution custom ers, including cor respondent banks. Oxford Properties owns the portion o f the block once occupied by Donald sons D epartm ent Store. Norwest has control over the portion of the block occupied by the building that housed Norwest Bank M inneapolis prior to the fire. OHIO AmeriTrust, Cleveland, has named Norwest Corp., Realty Firm To Develop CityrBlock Area Norwest Corp. has announced plans to develop an e n tire city block in downtown Minneapolis in partnership with Oxford Properties, In c., Denver. The proposed project would include a new building to replace the 54-yearold N o rth w e ste rn N a tio n a l B an k Building that was severely damaged by fire last Thanksgiving Day. The block is bounded by 6th and 7th streets, Nicollet Mall and M arquette Avenue. Although an architectural firm has not yet been selected, construction could begin in the fall of 1984, pro v id ed n ecessa ry a g ree m en ts have been negotiated. Stephen E. Kunk, a senior vice presi dent, head of the national division. He joined the bank in 1981 and had been in charge of the regional office in C in cinnati. John S. C h ristie has b een promoted to senior vice president, re gional corporate banking division, in cluding Columbus, Cincinnati, T ole do, Chicago and Dallas. He joined the bank in 1979 and had b een responsible for the Columbus region of the corpo rate banking division. BancOhio National, Colum bus, has elected Daniel K. Archer, R obert W. C o n n e ll, R onald L. M an n in g and Thomas B. M itchell vice presidents and Philip R. Behner, Gerald S. F al con and Dennis J. Zuchowski assistant vice presidents. Drovers Bank has ju st made discount brokerage available to its correspondent bank customers. This means fees generated for you, and substantial savings for your customers. And Drovers specialists can advise you how to market this new and valuable service in your area. Discount brokerage: another reason Drovers is one of the fastest growing correspondent banks in the midwest. Call Joh n Crotty or Kathy Hardy at 1-800-621-8991. In Illinois, 1-800-572-2498. Remember, fees for you, savings for your customer. And it all starts with a phone call to Drovers. e ? D ro v ers B a n k o f C hicag o 47th & Ashland Avenue, Chicago, IL 60609 •1-312-927-7000. MEMBER FEDERAL RESERVE SYSTEM AND FDIC MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 35 Huntington National, Columbus, has p ro m o ted D ia n e L. A lex a n d er, Jonathan H. Donaldson, Richard C. France Jr. and W. David Schwamberger to vice presidents and Thomas P. Grabenstatter, Carolyn K. Krieg, D ar rell C. Sanner and Lynn A. Stowe to assistant vice presidents. George S. Brookes has been named executive vice president at Huntington Bank of Northeast Ohio, C leve land. H e form erly was senior vice president and head of the central Ohio commercial-lending division at H unt ington National, Columbus. Frank S. Bozick, senior vice president, has suc ceeded Mr. Brookes. Central National, C lev e la n d , has electe d D avid J. W orthington and Leonard M. English vice presidents in th e O hio d iv isio n and f a c ilitie s adm inistration d epartm ent, resp ec tively. Mr. W orthington joined the bank in 1978; Mr. English in 1977. Ralph H. Lockwood, executive vice president, Huntington National, C o lumbus, has been re-e le cte d p resi d ent, C en tral R egional Autom ated Funds Transfer System, based in C ol umbus. The system serves 400 finan cial institutions in parts of Ohio and Kentucky. Banc One C o rp ., C o lu m b u s, has announced plans to buy Yegen Associ ates, In c., Paramus, N. J ., a consum er-loan production firm with 67 offices in 23 states. The firm specializes in auto, first and second mortgage, home improvement, marine, mobile home, recreational time sharing and aircraft lending, as well as auto leasing. New Bank Building Opened Marion Nemetz to senior vice president/operations, John Syndergaard to v ice p re sid e n t/ a g ricu ltu ra l lo an s, Monica Vomastic to vice president/finance and Lynette E ngel to cashier. American Exchange Bank, Madison, re cently held a ribbon-cutting ceremony to open its new West Bank building on Miner al Point Road in Madison. To observe the opening, the bank gave aw ay T-shirts, bal loons and other gifts and a prize drawing was held each day for almost two weeks. The 7,000-square-foot building features a cathedral ceiling and represents an invest ment of $1 million. John (Jay) Bengtson Jr. has join ed Citizens American Bank, G reen Bay, as vice president/personal banking, a new position. He formerly was with F irst Northern Savings & Loan and Kellogg Bank. Linda L. Bartelt has been promoted to v ice p resid ent/ m arketing d irecto r, Firstar C orp., Appleton. She has been associated with Firstar Bank Oshkosh and Firstar Bank Appleton. John C. Cumicek has b een named president, Firstar Bank Seymour, suc ceeding Philip C. Dahlman, who has retired. Mr. Cum icek joined Firstar in 1973 after service as a bank examiner. Bank Celebrates Anniversary Timothy R. Fitzwater has been named v ice p resid ent/ senior loan o fficer, N atio n al C ity B a n k , A kron. H e formerly was vice president, m etro politan division, National City Bank, C leveland . H e jo in e d th e bank in 1969. F&M Bank Menomonee Falls celebrated its 75th anniversary recently by giving hot-air balloon rides, using the bank's parking lot as a landing pad. 36 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Valley Bank, Shawano, has promoted M artha D ecker has b e e n n am ed general counsel for M idwestern Ban co, In c. Sh e rep rese n ts C om m on w ealth Bank, M ilw aukee; Bank of Fond du Lac, Bank of Spooner and B an k o f H ayw ard, all affilia tes o f Midwestern Banco. Citizens B a n co rp ., G re e n B ay, opened a new corporate office last month. The office, located at 801 E. W alnut Street, is headed by C. Alex Huck, regional senior vice president of the HC. Assisting Mr. Huck is Barry Jam es, a regional vice president for the HC. The Minneapolis Fed has approved the following applications for forma tion of one-bank HCs: Peoples Bancshares, Hayward, through acquisition o f Peoples National, Hayward, and Citizens Financial C orp., Fort Atkin son, through acquisition of Citizens State, Fort Atkinson. First, Chicago, Joins Cirrus: Completes National Coverage First National, Chicago, has joined the Cirrus System, national electronic banking network, as a principal m em ber. T h e bank is p ro v id ed w ith th e franchise to sign up any financial in stitution within Illinois as a correspon dent m em ber of Cirrus. According to Alex W . “P ete” Hart, chairman of Cirrus and executive vice president, F irst Interstate Bankcorp., Los Angeles, F irst of Chicago’s partic ipation com pletes the national cover age Cirrus has been seeking. Cirrus is owned and operated by the follo w in g b a n k s: M a n u fa ctu re rs Hanover, New York City; F irst In ter sta te, Los A n g eles; M ellon Bank, P ittsb u rg h ; N o rw est C o rp ., M in n ea p o lis; N B D B a n co rp , D e tr o it; M e rc a n tile T e x a s C o r p ., D a lla s; W a ch o v ia B a n k , W in s to n -S a le m , N .C .; A m e ritru s t/ C e n tra l T ru s t, Cleveland/Cincinnati; United Virginia Bank, Richmond; Sun Banks, Orlan do, F la.; BayBanks, Boston; and Trust Company of Georgia, Atlanta. In other action, G. Henry Mundt III has joined Cirrus as sales manager. He is responsible for expanding the network. He formerly was with Chase Manhattan, New York City, where he was vice p resid en t in the in d irect financial services group. MID-CONTINENT BANKER for September, 1983 V 1 ■* J Y 4U . - äi For \four Bank, Nothing Less W ill Do. Arrow Business Services offers you Kittinger, including the Georgian Series pictured here. And Baker, Gunlocke, Steelcase, Knoll...the who’s who of office furnishings. All the prestige names display their best in our Memphis showroom, complete with accessories, carpet, window and wallcovering. Arrow’s staff of ten experienced bank designers can make your bank a stunning and workable showcase from the executive offices to the customer, operations and data processing areas. Give us a call for a professional, costeffective proposal to meet your bank’s building and furnishings needs. We offer the best, and we know you expect nothing less. HRROI44 BUSINESS SERVICES, INC. p an affiliate of Memphis Bank & Trust 3050 Millbranch, Memphis, Tennessee 38116 901/345-9861 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 37 Small Community Bankers Develop Own Affordable Computer System P P E R M O ST in Kim W inchell’s able for our little bank.” Nor was he mind when he attended a bank enthralled with the o th er prospect er’s convention last year was investi open to him — going to an outside gating alternate com puter systems for vendor of com puter services. State Bank, Axtell, Kan., a $10 million “W e re a small, rural community institution where he is vice president. bank and w e’ve gotten used to doing all His search was not very promising. of our account processing in-house,” A system that would do everything he he says. “W e’ve never used a service wanted it to would cost in the neigh bureau and frankly, we didn’t want to borhood of $120,000 to $130,000. That start.” price, he says, “was totally unreason But Mr. W inchell had previous mi U BEFORE YOU BUILD A BANK, CALL A BANKER. Like Bob Hollis, President, First National Bank and Trust, Okmulgee, Oklahoma. He’ll tell you about The Bunce Corporation. Bunce just built his new bank. “ We wanted a bank that could grow with the city. We wanted high visibility, a bold architectural statement of faith in our community. We needed flexi bility for the most efficient use of employees. We certainly needed a single source to design, build and furnish our new bank. Bunce did just that. “ Bunce can be proud of this project. We are.’ ’ ^-7 / a /1 For a free brochure on “ How To Build The Best Possible Finamciat Building’’ call collect: Jeanne Price (314) 997-0300. In Texas, call collect: Sharon Hatchett (214) 387-3033. THE BUNCE CORPORATION 38 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cro-com puter experience and he was certain there ought to be a way of com ing up with an integrated system that would m eet the needs of a community bank at a price the bank could afford. He got together with other com munity bankers facing the same prob lem and founded Bankers Own Sys tems, In c., an association specializing in the developm ent of data-processing micro-computer hardware and bank er-designed software. Headquartered in W ellington, Kan., Bankers Own is currently serving community banks in the central Midwest. Bankers Own brought John Bissel, a 17-year veteran o f bank data proc essing, on board as president. After an in-depth culling process, North Star’s Horizon, a m icro-com puter marketed primarily to systems integrators like Bankers Own, was selected as the approved hardware. A comprehensive software package designed to m eet the needs of a small bank was developed. The list of available programs includes: g en era l le d g e r, savings, C D s and money market; demand deposit; loans, interest/dividend, withholding tax and asset/liability management. Mr. W inchell is among three midw estern bankers who have installed com plete Bankers Own systems and he professes great satisfaction with the results so far. State Bank purchased the m ulti-user package that sells for about $ 36,000. Single -user systems start at $23,000. The price includes all sy stem in s ta lla tio n s , co n v ersio n s, maintenance and personnel training. “I got into this for less than half what I thought I was going to have to pay,” Mr. W inchell says, “and it is working ju st the way we expected it to. ” Stan Neff, executive vice president, Citizens State, Utica, Kan., is in the process of converting to the Bankers Own System, and the results so far have been “su per,” he says. Citizens State has used off-premises computerservice bureaus in the past fairly exten sively but was forced to develop an in -h ou se cap ab ility w hen its dataprocessing supplier closed. Bankers Own system was attractive because of its price and com prehensiveness, Mr. N eff says. Software updating — to keep pro grams current with government reg ulations and other variables — are another bonus of the Bankers Own sys tem , Mr. W inchell says. W hile he says he hesitates to place limits on the capa bilities of the system, he adds that a bank somewhat larger than his own might have more volume than the sys tem can comfortably handle at pres ent. But the system is being improved. MID-CONTINENT BANKER for September, 1983 What should you look for in a discount brokerage service for your custom ers? Experience. Dependability. High Tech. Growth Potential. Marketing Expertise. Success. When you select a discount brokerage service for your customers, you’ll want it to give them the high level of service they associate with your institution. That’s why it pays to investigate the available services to see which offers the best assurance of satisfaction. Salem, Oregon. Our success, as measured by customer satisfaction and published trade volume figures, far exceeds that of our competitors. Or, just call Brenner Steed. The Brenner Steed Partner Plan is built on the qualities that made our business successful. Experience. Brenner Steed was established in 1976, shortly after the Securities and Exchange Commission did away with fixed brokerage commission rates. We’ve been the premier discount broker in our market area practically from the beginning, with a strong, steady growth that has made our profit position very comfortable. Dependability. Discount brokerage customers aren’t looking for research or advice. They demand dependable, accurate, correctly executed trade transaction service; and the faster the better. That’s what we’ve given our customers, and that’s why we’ve kept them. High tech. Today’s highly automated markets and exchanges are no place for manual-intensive brokerage firms. Brenner Steed from the beginning, has utilized advanced technology as the only sure means of the swift service customers demand. Growth potential. In 1982, Gnion Planters National Bank of Memphis bought Brenner Steed— the first such acquisition by a bank after the Glass-Stegall Act was successfully challenged. This has given us an unusual depth of capital backing, as well as the necessary insights needed to serve customers of financial institutions. These new capabilities, together with the opening of wide new markets, give us practically unlimited growth opportunity. Marketing expertise. From the beginning, Brenner Steed recognized the importance of marketing. Our carefully designed advertising, promotion and training programs have been a vital factor in our growth and success. Successful track record. Since late 1982, Brenner Steed has instituted brokerage services for financial institutions from Fort Lauderdale, Florida, to MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis What can Brenner Steed offer you that our competitors can’t? Most of them can offer you som e of the qualities outlined here. But only Brenner Steed can provide all of them. Example: The new services “created solely to serve banks and savings and loans” may match Brenner Steed in sensitivity to the needs of financial institutions. But they haven’t our all-important discount brokerage experience. Nor do they have the technology to deal directly in the markets and ex changes. And, obviously, they have no track record to give you any assurance of success. Example: The highpowered discount brokerage giants now offering service systems to financial institutions may match our technology and direct access to markets and exchanges. But, they have little understanding of the traditional high level of personal service your customers expect. Example: In the all-important areas of marketing, only Brenner Steed offers comprehensive, effective advertising, promotion and training programs to build your service into one that is satisfactory to your customers and a profit center for you. Ask Gs To Prove We’re Better. Call today, 800-238-7125, and ask for Michael Tierney. He’ll tell you more about the Brenner Steed Partner Plan and put you in touch with som e of the banks that are enjoying its profits. Then, let’s talk about a “Partnership.” CALL FOR FREE REPORT DISCOUNT BROKERAGE SERVICE FOR BANKS BRENNER STEED INC. DISCOUNT BROKERS MEMBER NASD. SIPC 6 0 7 7 Primacy Parkway, Suite 423, Memphis,TN 38119 901-761-2950 Toll Free 1-800-238-7125 39 A djustability Is Key to Bank Survival, Say C o m m unity Bankers in BAI Survey URVIVAL and profitability of com banks were selected through use of the munity banks depend largely on B A I’s “index of bank perform ance,” th e ir a b ility to a d ju st sw iftly tobased on condition and incom e state a c c e le r a tin g re g u la to ry c h a n g e s, ments required by the F D IC . Return according to a Bank Administration In on assets and return on equity are used stitute (BAI) analysis o f a survey of top as a criteria to determ ine the top 20% e x e c u tiv e s at th e n a tio n ’s b e s t in performance among the 6 ,5 0 0 banks performing community banks. the BAI includes in the asset range of “Handling the pressure exerted on $25 million to $175 million. community banks to profitably deploy A cco rd in g to th e su rv ey , h ighfunds they must purchase at premium performance community banks tend to rates will be critical in achieving sur consider certain of the following man v iv a l,” says Richard H. N eedham , agement strategies to be more impor director of the B A I’s C enter for High- ta n t to p ro fita b ility th an o th e rs . Performance Banking. Strategies included in the survey, plus S Strategic planning will become increasingly important in the successful operation of community banks. A key element in that planning will be effective asset/liability management, including varia b le -ra te loans, shorter maturities, loan pricing, spread/margin/gap manage ment and liability pricing. Executives surveyed indicated that strategic planning will b eco m e in creasingly important in the successful operation of community banks. A key elem ent in that planning, say the bank ers, will be effectiv e asset/liability management, including variable-rate loans, shorter maturities, loan pricing, spread/margin/gap m anagem ent and liability pricing. Control of non-interest expense also is cited as being of increasing impor tance as interest expense is expected to continue to mount. Improved person nel productivity and more efficient use of technological innovations as they becom e available will be needed to maintain profitability. On the revenue side, products must be priced carefully to build profits, while remaining com petitive in the marketplace. Mr. Needham notes that bankers feel strongly that “m arketing must come of age in the new regulatory en vironm ent. In creased com p etition, coupled with a more knowledgeable and demanding — but less loyal — consumer public, requires community banks to integrate marketing into all areas of management and operations, starting with the strategic plan.” P a rtic ip a tin g h ig h -p e rfo rm a n c e 40 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis some added by respondents, w ere re lated to profitability in the following order: • Asset/liability management, spe cifica lly v a ria b le -ra te loans, short m aturities, pricing of loans, spread/ margin/gap management, investments and pricing of liabilities. • Cost control, by means of m ini mum staff, training and development, low turnover and data processing. • Marketing, specifically custom erservice/relations, segmentation, sales/ business developm ent and community relations. • Quality and productivity of em ployees. • N on-interest income and pricing. • Low loan losses. • High loan demand. • L arg e p e rc e n ta g e o f lo w -co st funds. • Training. Strategic planning will be the man agem ent tool most critical to future p ro fitab ility , th e survey rev ealed . Through planning a bank can position itself to be a manager of change, rather than a victim of the changing environ ment. Planning is the process by which a bank evaluates its own position and determ ines how it can best turn mar- k et ch a lle n g e s into o p p o rtu n ities. Planning is crucial in selecting the combination of strategies that will be most effective in m eeting particular needs and objectives and providing the framework for these strategies. A sse t/ lia b ility m a n a g e m e n t b e comes more important in terms of ex pertise and internal agility without the protection o f Regulation Q, bankers reported. The balance sheet and the incom e statem ent becom e more in terrelated. The higher cost of acquir ing funds will exert more pressure on the bank for profitable deployment of funds, without undue exposure to risk. D ifferent areas of asset/liability man agem ent w ere named most often by high-perform ance bankers as being factors linked to their continued suc cess. As interest-rate risk becom es more o f a concern, flexibility appears to be one of the most desirable characteris tics in a bank’s asset/liability manage ment. Bankers surveyed favored vari able-rate loans and short maturities in loans and investments as a means to maintain this desired flexibility. How each bank choses to achieve this flex ibility will depend on its asset/liability mix, interest-rate sensitivity, loan de mand, the market rate of interest and its own strategic plan. A com puter model can aid most community banks in analyzing its situation and making prudent asset/liability decisions. As interest expense increases, com munity bankers must give more atten tion to th e con trol o f n o n -in terest costs. This was named specifically by more bankers than any other elem ent as being critical to continued profita bility. Improving productivity in both hu man resources and technology will be an effective way to control non-interest expense. The banks surveyed depend more on the management of human resources for improving productivity than on technological innovations. Since human resources are the sec ond greatest expense a bank incurs and because the success of a community bank depends greatly on its personnel (employees being the fourth highest in factors related to profitability by sur vey respondents), this is a valid area for MID-CONTINENT BANKER for September, 1983 C a p tu re th e g ro w in g 6 0 + m a rk e t fo r y o u r b a n k w it h Besides being am ong your bank’s most profitable accounts, senior citizens are one of its fastest-growing markets. Fact is, their numbers are growing tw ice as fast as the total U.S. population. So it’s obvious that winning a growing share of this 6 0 + market is im portant to your bank’s long-term success. And that’s precisely what H O R IZO N S 6 0 ™is designed to do. H O R IZO N S 6 0 ™is a com plete, ready-m ade senior citizens program with a proven record of success in attracting new bank customers and deposits from the 6 0 + population, as well as strengthening bonds with existing customers in that age group. Included are a well-organized travel tour program, quarterly newsletter, shop-by-mail service, accidental death insurance, car rental discounts, optional M edicare Supplem ent health insurance plan, all necessary advertising materials—in fact, everything you need to make your bank the market leader in your community. All at a fraction of the cost of developing it on your own. And these tangible dollar savings don’t even begin to take into account the savings in expensive bank m anagem ent time. W rite or phone us today for full details on H O R IZO N S 6 0 .™Sooner or later, one bank in your community is going to capture the major share of the 6 0 + market. Shouldn’t it be yours? P.O. Box 3 0 0 6 3 • St. Louis, MO 63119 • (314) 962-9310 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 41 concentration. Banks must evaluate technological innovation carefully in the future to determine if the initial cost will be offset by long-term produc tivity and marketing gains. Bank marketing must come of age in the deregulated environment. Highperformance community bankers re flected a somewhat fragmented view of bank marketing in the survey. Areas related to marketing were the third most frequently named elements con sidered critical to profitability. Faced with increased competition and a more knowledgeable, demand ing and less loyal consumer, commu nity banks must integrate marketing into all areas of management, starting with the strategic plan. source of income. Bankers surveyed exhibited a strong awareness of this need. The list of ways they plan to generate new fee income is intermi nable. If regulatory lim itations are re moved with regard to the types of ser vices a bank can offer, the potential for fee income will be broadened. More than half the bankers surveyed indi cated they expect to offer brokerage, insurance or money-market mutual funds, should restrictions be removed. The community bank must use caution in its effort to generate fee income from new, unfamiliar services. It could lose effectiveness by trying to be all things to all people and departing from the services it knows best. With the advent of deregulation, the era of free services has passed. The Bankers responding to the successful bank of the future will price BAI survey were asked their explicitly and for profit, evaluating these prices on a regular basis. Most of views on where their most se the banks surveyed have repriced the rious competition would come services most utilized within the past from during the next five years. two years. Several indicate plans to review prices on an annual basis. Almost two-thirds listed other It’s evident that the solution to com banks, 4 2 % listed S&Ls, 3 4 % munity-bank profitability isn’t simple, said Sears, 2 2 % listed Amer Mr. Needham says. However, the BAI study concludes that in order to sur ican Express, 1 8 . 5 % said vive and continue profitability without credit unions and 1 3 % listed the protection of Regulation Q, com munity banks must place strong em other sources. phasis on strategic planning, flexibility in asset/liability management and cost Relationship banking, long prac control. ticed at least to some degree by com Through strategic planning the bank munity banks, should be developed as analyzes its own situation and deter an effective way to bind customers to mines what combination of strategies the bank by multiple services. By the will work best for it at a particular time. high performers’ own self-evaluation, Through flexibility in asset/liability customer service and customer rela management, the bank is able to adjust tions are areas in which community to volatile interest rates and minimize banks excel. These are strengths that interest-rate risk. By controlling non can become powerful factors in ex interest expenses with increased pro panding and cementing customer rela ductivity of human resources and tech tionships. nology, the bank com pensates for Segmentation is another valid mar shrinking margins brought about by keting approach for community banks. deregulation. Almost half the banks surveyed seg These strategies will enable the m ent th eir m arkets. This means community bank of the future to adapt matching the most profitable segments to the changing environment, Mr. in the market to the things the bank Needham says. An anonymous quota does best for the most effective and tion, sometimes attributed to Charles profitable marketing approach. Darwin, says: “The species that sur M ore know ledgeable custom ers vives is not necessarily the largest, the force banks to have more knowledge strongest, or the most intelligent. The able employees. Almost half the banks species that survives is the one that is surveyed have formal training pro most adaptable to change.” • • grams in operations and different aspects of marketing. A well-trained staff will contribute to the success of relationship banking and also to total productivity, bankers reported. As interest margins shrink, com munity banks will, out of necessity, look more to fees from services as a 42 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Visa Commits $3.8 Million To Speed POS Expansion The Visa USA board of directors has authorized spending up to $3.8 million to expand telecommunications sup port of point-of-sale terminals, test second-generation new dial terminals as well as a Visa proprietary audio response terminal and establish a ser vice capability to install and service point-of-sale terminals. These developments are part of a Visa payments-system strategy to give our members the means to electroni cally authorize every individual trans action made with a Visa payment de vice,” said D. W. Hock, CEO, Visa USA and president, Visa Internation al. Currently, Visa members have in stalled some 35,000 dial terminals worldwide. Another 8 ,0 0 0 are ex pected by year-end. “Our objective is to electronically verify 80% of all Visa payment-system transactions in the U.S. by 1985, Mr. Hock said. Visa will develop telecommunica tions facilities serving both dial and leased-line terminals to enable mer chants in at least 50 major metropoli tan areas to get authorizations via local telephone lines. Through a contract with a national term inal-service vendor, Visa also will structure and test a program for the installation and maintenance of point-of-sale terminals. With this op tion, member banks can relegate the installation and service of terminals at their merchants to an organization under contract to Visa. The operation will be managed from a Visa service center in San Mateo, Calif. The tests will be fully compatible with V isa’s previously announced programs to test its new Electron card through a pilot point-of-sale program in the fourth quarter. The expanded telecommunications, new terminals and national terminal service facility comprise the first phase of a three-phased Visa merchant elec tronic delivery system expected to be completed in 1985. • McGraw-Hill has published Foreign Exchange and M oney M arkets, an ex panded version of the firm’s earlier Foreign Exchange M arkets, by Heinz Riehl and Rita M. Rodriguez. Subject matter ranges from selecting the most economic currency for borrowing and investing to operating under exchange controls to managing liquidity and liability positions. MID-CONTINENT BANKER for September, 1983 YOUR SURVIVAL MANUAL FOR THE 8 0 S At last! A clearly-written, com prehensive guide through the maze of modern banking, written by leading consultant Bob Sellers. Why have so many banks failed in re formation based upon his extensive ex perience and observation. cent times, while others continue to In Banking: The Age of Crisis and prosper? Opportunity, he talks frankly of take What new strategies and tools are overs, mergers, acquisitions, new many bankers already learning to use regulations, trust de successfully? i ------------------------------------1 p a rtm e n ts , c a p ita l Bob Sellers, foun Rush_______ copy(ies) of B a n k in g : The adequacy, cash man der of Banking Consul A g e o f C ris is a n d O p p o r tu n ity to: agement . . . in fact, tants of America, and NAME______________________ just about every topic Chairman of the Board ADDRESS___________________ affecting the tu rb u of First Southern Trust lent banking industry Company, has written today. many articles on bank STATE__________________ ZIP_______ If you have time to ing and has spoken Enclosed is a check or money order for $27.95 per book, postpaid. read only one book before banking and Mail to: B a n k in g : T h e A g e o f C ris is a n d O p p o r tu n ity this year, make it this academic groups. Now, Dept. MC, P.O.Box 1644 Washington, D.C. 20013 one. Order your copy in one book, he’s com piled a wealth of in- I___________________________________ I today. MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Study Says Com petition, N ot N eed, Affects C o m m unity Bank Liability Pricing I N D EPEN D EN T community banks are reacting more to competitive pressures than to their own funding needs in pricing liabilities in today’s market, a survey has revealed. The survey involved members of the Financial Services Roundtable (FSR) in Texas, Oklahoma and Illinois. FSR membership is made up of community banks that generally do not have access to cooperative data on industry trends, such as is available to members of larg er bank holding companies. FSR is in tended to be a clearing house for data that will help those banks compete in the increasingly competitive banking environment. J. Keith Hughey & Co., Houstonbased specialists in financial manage ment, coordinates the transfer of in formation within FSR and serves as manager of its activities. Mr. Hughey said that indication was reflected later in the survey when members were asked to rank 12 topics in order of their importance to banks in 1983. The clear winner was asset/ liability management. Using a weight ed scale such as is commonly used in sports balloting, A/L management accumulated 313 total points out of a possible 360, with about 43% of the respondents listing it as the most im portant. C redit quality, expense control, loan pricing, customer profitability and non-interest-income development all scored between 215 and 250 points. M anagem ent information/decision support systems, strategic planning, capital planning/capital adequacy, data processing, liquidity and marketing each scored betw een 110 and 180 points. Some banks are taking highly aggressive and some times questionable postures in courting money-market funds. As banking practices return to normal, bankers are expected to once again consider their yield curves when establishing rates. “The primary thrust of FSR is to help members compete in a dereg ulated banking c lim a te ,’’ K eith Hughey said. “Ultimately, we expect that the sharing of information be tween members will be helpful in ev erything from acquisition of dataprocessing systems and services to the evaluation of merger proposals.’ In the 11-part survey to compose community bank profile/liability pric ing, fully half the members indicated that local competition weighed heavily in their decisions as to the interest rates they pay on new money-market accounts. Weekly T-bill auctions were used by 46.66% as a major determin ing factor. Members were allowed to list more than one factor, since multi ple considerations often play a role in rate setting. “Interestingly enough,” Mr. Hugh ey said, “only about 7% indicated that prime was a consideration. As banks have become more comfortable with the new instruments, I believe we will see yield curves weighing heavily as a factor in setting in terest rates on money-market accounts.” 44 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis As a check against members’ balance betw een asset pricing and liability pricing, the survey asked respondents to list their prime rate for three signifi cant weeks: The week when moneymarket accounts were introduced (De cember 14-20); the week when super NOW accounts w ere introdu ced (January 5-11) and two months later. In December, “prime rates’ quoted ranged from a low of 11.50 to a high of 1 5 .2 5 . In Jan uary, the high had dropped 50 basis points to 14.75. In the first week in March, the low had dropped a full 100 basis points to 10.50, while the high had made a minor upward adjustment to 15. Throughout the period, however, the trend was downward, as indicated by the average prime rates among all banks surveyed. In the third week of December, it was 12.38. In early Janu ary, it dropped to 12.21 and by early March, the average was down to 11.47. “W hile F S R banks clearly were strongly influenced by national market rates, they showed a willingness to de part from those guidelines in order to address local c o m p e titio n ,” Mr. Hughey said. “There was less willing ness to depart from national rates on the liability side, however. We also were surprised to discover that the m ajority oi F S R m em bers closely tracked national rates on jumbo CDs, even though they frequently departed from national rates in other areas. “We can conclude that competition is stiffer on the rates banks charge for loans than on what they pay for de posits. That would tend to confirm our observation that competition shifted more toward the com m ercial area among all banks during the recent eco nomic downturn,” Mr. Hughey said. The survey also measured the im pact money-market accounts can have on community banks. By the first week in March, money-market checking accounts, as a percentage of total de posits, ranged from a low of 2/100ths of 1% to a high of 21% — all in only two months. The savings version was even more popular, ranging from a low of 1.17% of total deposits to a high of 24%. “Fortunately, the two highs did not come out of the same bank,” Mr. Hughey noted. “However, two banks did report that within a 75-day period, over 32% of one bank’s total deposits suddenly had become rate sensitive. To a large extent, penetration of these new accounts correlated to the level of interest rate offered and the education and business acumen of the customer base each bank served. “We found that virtually all banks in the survey experienced some deposit growth during the period from late December to early March. On aver age, growth ranged anywhere from about $2.5 million up to almost $14 million, largely attributable to new ac counts. “As a percentage of deposits, that would represent from 2% to more than 11%, all in a two-and-a-half-month period,” Mr. Hughey said. He pointed out that some contradic tion in results did occur. For instance, banks rated asset/liability manage ment as the single most important sub ject to them during the current year. Yet, less than 10% indicated it was fun damental to setting the yield curve of their jumbo CDs. “They don’t look at their own asset and liability sensitivity in terms of what CD maturities are in their best MID-CONTINENT BANKER for September, 1983 R ising to the Challenge! Huey J. Wilson Chairman of the Board W. J. "D ub" Noel President and Chief Executive Officer Charles Chiasson Sr. Vice President Operations Division and Data Processing Irwin Felps Vice President Investment Division Jack Carney Vice President and Manager Financial Institutions Services Dale Dupuy Vice President in Financial Institutions Services You can call it deregulation, un fair competition, technological de velopment, or survival. But the true challenge of the decade is achieving excellence in perform ance through people. That's the challenge! It always has been, it al ways will be. The challenge is universal. We must face it, and so must you. As an industry, a company and as in dividuals we must rise to the chal lenge of achieving excellence. There is no easy way out. No pat answ er. We achieve excellence only through committment, team work and endurance. Rising to the challenge every time . .. all the time. At A m erican Bank, we take excellence seriously. We believe it shows in the way we do business. We're told it shows in the quality of our service. We'd like the oppor tunity to show you. AM ERICAN BANK B E T T E R A N SW E R S. American Bank and Trust Company, PO Box 591 Baton Rouge, Louisiana 70821. Telephone (504) 292-0336 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 45 interest to acquire for the coming period. If you are very asset sensitive in the 0-60-day period, it would be wise to price short-term jumbo CDs a little higher than anyone else. That would attract more short-term de posits, thereby reducing the sensitiv ity mismatch.” Mr. Hughey said the problem with mirroring an upstream correspondent is that you are assuming his sensitivi ties duplicate yours. Those banks, he said, probably have set their yield curves to match their sensitivity, so it is mostly luck if the rate curve is appropriate to the bank’s circum stances, given the disparity between large and small banks in balance-sheet composition. The same is true of basing rates on local competition. That works well only when the two banks’ sensitivities are identical. In most cases, they aren’t, Mr. Hughey said. “Much of the increased emphasis on watching what the other guy is doing is to be expected during the early days of m oney-m arket c e rtifica te s. Some banks are taking highly aggressive and sometimes questionable postures in courting such deposits. As banking practices return to normal, we expect members to once again consider their yield curves when establishing rates,” Mr. Hughey said. • • T FORD 46 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Loan Workout (C ontinued fr o m page 24) M a r k e t in g T o p ic s t o Be F e a tu re d A t B M A C o n v e n tio n in A t la n t a HE BANKING industry’s chal lenge from nonbank competition as well as marketing’s orientation to ward bottom -line perform ance are areas to be highlighted at the Bank Marketing Association’s 68th annual convention to be held October 23-26 at the Atlanta Hilton. An estimated 2,000 bank-marketing professionals from around the world are expected to convene in Atlanta for the four-day conclave. Keynoting the conference will be Archie J. McGill Jr., former president of AT&T’s advanced information sys tems division, who recently joined Rothschild Ventures, Inc., a venturecapital subsidiary of the Wall Street investment banking firm, Rothschild, Inc., as president/CEO. Other convention speakers include R. A. M cK innon, vice p re sid en t marketing, Delta Air Lines, Atlanta; John Naisbitt, author of the b est selling book M egatrends; and Miles A. Nelson, director of marketing information/coinmunication, 3M Co., Min neapolis. Among the convention panel discus sions will be “Status Report: ATM National Networks,’ with D. Dale Browning, president, Plus System, able financial services. This year’s convention them e is “ M anaging for P ro fitab ility : The Marketing Challenge.” According to Robert Perdue, convention chairman and vice president, South Carolina National, Columbia, the theme was chosen to acknowledge the marketer’s increasing responsibility within the management team. Other subjects to be addressed include product-portfolio analysis, matching liabilities to assets and discount brokerage. • • Denver; Bruce A. Burchfield, presi dent, Cirrus System, Oakbrook, 111.; George J. Fesus, executive vice presi dent, MasterCard International, New York; and John O. Smith, director, ATM Network, Visa USA, San Fran cisco. Also planned for the convention are two special panels — one composed of presidents of Federal Reserve banks discussing economic, regulatory and pricing issues, and a second of promi nent bank-stock analysts who will view the outlook for bank profitability. Members of the Fed panel include William F. Ford, president, Atlanta Fed; E. Gerald Corrigan, president, Minneapolis Fed; and Anthony M. Solomon, New York Fed. Convention sessions are scheduled on numerous phases of bank market ing, including product development, pricing, sales development/management, positioning and distribution. Workshop sessions are designed to provide the new practitioner or experi enced bank professional with an opportunity to profit from the experi ence of others, to be better informed on current issues facing bank market ers and to become familiar with the process involved in developing profit- McGILL CORRIGAN tions of the company’s cash flows to determine if it has sufficient cash flow over the short term for absolute needs like payroll and insurance. • Determining if the company will be cash positive or negative in the near term and what the cash-flow opportu nities are to cover any anticipated shortfalls. “After this analysis, the workout specialist’s first goal is to develop strategies to stabilize the company’s operations. At this point, a more thor ough analysis usually is needed to assess existing management, deter mine strengths and weaknesses of the company and industry over a longerterm basis, encourage management to either do or review its long-term busi ness plan and decide if the bank is dealing with a viable business enter prise. The answer to the viability ques tion has a major impact on whether or not the credit becomes a workout or if it is liquidated.” The workout specialist may then turn into an operations consultant, say Messrs. Johnson and Marks, especially if the specialist has limited technical expertise in a given industry. A skilled operating consultant can recommend additions and modifications to turn around plans which can help transform “impossible dreams” into potential winners. “The seriou sness of the non perform ing loan e p id e m ic,” say Messrs. Johnson and Marks, “would seem to justify even the most radical measures. Yet, it is hardly radical to suggest that lenders, first, begin to re view non-performing loans and bor rowers from both financial and operat ing perspectives and, second, develop an aggressive policy of helping nonperforming borrowers assess their situations objectively in developing sound turnaround programs of accept able potential. ” • • MID-CONTINENT BANKER for September, 1983 An Im portant New Service For YOUR Full-Service Bank BUILD A NEW PROFIT CENTER FOR YOUR BANK, and add a vital new service with BANCVEST, a leader nation wide in discount brokerage services. BANCVEST was created just for banks, to provide a simple, low-cost discount brokerage program to add to your slate of full services. With BANCVEST, you can offer your customers securities trades with commissions discounted up to 70% and your bank benefits with one of the highest returns in the industry. When you choose BANCVEST, we will help you market your services with print ads and radio copy. Write today for details. BANCVEST - we’re designed for banks! 1 1 MAIL TO: BANCVEST 119 South 19th Street Rm. 200 Omaha, NE 68102 S ÎP C 1 1 NAMF. 1 TITLE 1 RANK NAME 1 ADDRESS 1 CITY STATE ZIP MCB 1 BV-102 Bancvest is a trade name owned by Ameritrade Inc., a registered Broker/Dealer and member of SIPC MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 47 C o m m unity Bank's Investm ent C o u n selo r Assists U p -Scale M issouri Retirees of investm ents, flexib ility and an ab ility to empathize with people were among the requirements for a newly created position of investment counselor in an up-scale custom er program — targeted at retirees — established by Centerre Bank, Branson, Mo., this year. Sue Call, the person selected to fill that position, considers herself a con duit for investment information that Centerre’s customers can tap at any time. Retirees comprise over half of the local population in Branson, and Cen terre has long considered them to be its primary target market segment, according to Smith W. Brookhart III, president/CEO. But Centerre has also become aware that in today’s more competitive arena, banks are not going to provide all the investment opportu nities people have available to them, Mr. Brookhart says. “Last fall we decided that if we can’t count on our up-scale customers keep ing their money in CDs, we’ve got to be in the position to become a conduit through which they place those other investments,’’ Mr. Brookhart explains. Whether the customer wants to in vest in T-bills, stocks, gold, Arabian horses — whatever, Centerre Branson intends to be available to provide in formation and assist the transaction — for a fee, of course, he says. Since many Branson residents have retired from jobs they held in larger communities, they are more knowl edgeable about investments than most small-community residents, Mrs. Call postulates. Yet she occasionally is amazed by how little some of her clients know. NOW accounts — as much as they have been advertised — are entirely foreign to a few, she says. Mrs. Call is no high-pressure sales woman. Her job is to be an adviser and confidante. “W e want her to build a trust and confidence so that her cus tomers feel comfortable coming to her and asking, ‘Sue, where do you think I should put my money for the next 30 days, 30 months?’ or whatever they say,” Mr. Brookhart says. C enterre Branson is planning to start its own brokerage service shortly, K n ow ledge 48 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Sue Call, investment counselor a t Cen terre Bank, Branson, Mo., considers her self a conduit for in vestm ent info rm a tion that bank cus tomers can tap at any time. but Mr. Brookhart stressed that the bank would not be advising customers which stocks to buy. Rather, Mrs. Call attempts to give the customer a range of choices that make sense and then completes transactions specified by the customer, he says. Since starting out with Centerre Branson 14 years ago, Mrs. Call has demonstrated an ability to work well with people. She moved up through the ranks to become a teller supervisor and later an assistant cashier. In the latter position, her duties included tracking the bank’s cash position and, in that capacity, she picked up quite a bit of investment knowledge. When she was selected for the in vestment-counselor post, Mrs. Call was sent to Centerre’s holding com pany in St. Louis where she had an opportunity to work alongside execu tives in the investment-banking divi sion. There, she learned of invest ments that she had not previously en countered while in Branson. She also attended the Whittle, Raddon, Motley & Hanks school for de posit counselors in Chicago. Many of the students attending classes with her, she discovered, were in a similar situation — working for a bank that was just starting an up-scale customer investment-counseling program. W hen she returned to Branson, Mrs. Call was asked to appear before the board and officers to explain what her new job entailed and what types of customers should be referred to her for advice. Centerre also ran a newspaper advertisem ent for the new invest ment-counseling service that featured Mrs. C all’s photograph, and radio spots were made using her voice, according to Mrs. Louola Hicks, Mrs. Call’s supervisor. A “first-class” en velope stuffer announcing Mrs. Call’s counseling service also was used, according to Mrs. Hicks, a vice presi dent in the m arketing and newaccounts department. Mrs. Call has been out of the train ing phase of the program and actively serving full time as an investment counselor for only a few months, Mrs. Hicks says, and it is still too early to assess what effect Mrs. Call’s efforts have had on deposits or transaction fees. Centerre is monitoring the pro gram, however, and the results so far look promising. Already, Centerre management is considering the addi tion of a second person to assist Mrs. Call in the event she gets so busy she can’t handle the workload. Other in vestment counselors will be added as needed. Clients with estate-planning prob lems are referred to trust officers from the St. Louis holding company who are “far better equipped” to handle prob lems of that nature, says Mrs. Call. She schedules appointments with trust officers from St. Louis who visit Bran son on a regular basis. Again, her role is that of passive information conduit rather than an active advocate of one investment path versus another. W hether the subject is T-bills or gold, Mrs. Call says she feels comfort able passing along the information the client can use to make intelligent in vestment decisions. Gold, in fact, is a popular investment choice with re tirees she advises, she says. They tend to be conservative by nature and gold appeals to their need for security. Of course, there have been predictions that gold prices are poised for a strong recovery after a prolonged decline, she adds. In addition to the more knowledge able clients Mrs. Call serves, there are others who need basic assistance, in cluding “some widows whose hus bands were very definitely the head of the family,” she says. “Some of them need help balancing th eir check books.” Dealing with such customers in an unpatronizing manner requires pa tience and understanding, says Mrs. MID-CONTINENT BANKER for September, 1983 O O O In a world filled with ° hardware and software... w e o ffe r O O O O O O O O H U tT lfin iU P IR E ' Som etim es the hum an side of banking is more perplexing than the com puter side. T h a t’s why the Hum an In te re st bank offers you Hum anware. Call us toll free (800) 322-2212. Give us the opportunity to show you how our Hum anware can m ake a big difference in your bank operation. Hum anware . . . people who have the exp ertise and com m itm ent to help you w ith everything from cash le tter processing to e sta te and tru st services. O O O O H um anw are . . . people you can count on for quick and concise answ ers to your banking questions. H um anware . . . people to help you sort out the correspondent or corporate services you need. O the Human Interest bank O Commercial National Bank of Peoria Member Midwest Financial Group, Inc O COMMERCIAL BANKING DIVISION 301 S.W. Adams Peoria, Illinois 61631 Phone: (309) 655-5000 O MEMBER F.D.I.C. O O O O O O O O O O O O O O O O O O O O O O O O O O O O Jan Kepple A rt Hippie MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Dorothy Newlin O 49 Call. Most of her clients still are in good health and their minds are sharp. A few, she is convinced, will never be persuaded to transfer funds out of their passbook accounts into investments with higher returns or superior tax advantages. “They’ve had their passbook ac counts for years and they feel comfort able with them ,” she says. Mrs. Call says she doesn’t feel it’s her job to pressure clients into making investm ent decisions even if they might ultimately be better off finan cially as a result. Like a good tour guide, she lists the range of possibili ties and relative advantages and dis advantages of each. The final decision, she says, is still the customer’s. — John L. Cleveland, assistant to the publisher. Douglas-Guardian WAREHOUSE CORPORATION Home Office P.O. BOX 52978, NEW ORLEANS, LA70152 (504) 523-5353 FmHA/ABA Task Force Formed to Streamline Farm-Lending Operation A special task force to work on stream lin in g the Farm ers Home Administration (FmHA) guaranteed farm-loan program has been formed, involving representatives from the FmHA and the agricultural bankers di vision of the ABA. Robert W. Ranger, senior vice pres- The second most impressive address in the nation’s capital. Continental service. Spacious rooms and suites. The Apple of Eve. The Green House. Quorum Lounge. Swimming atrium (in season). Underground shopping mall, parking and Metro stop. Close to government, business and every sightseeing attraction. For reservations, see your travel agent or call LRI, Inc. toll-free: 800-223-0888. (In New York State: 800-522-5455. In New York City only: (212) 841-1111.) ■ L O E W S IP L A Z A 480 L'Enfant Plaza, S.W., Washington, D.C. 20024, Tel.: (202) 484-1000. 50 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ident, Oneida National, Utica, N. Y., heads a team of five bankers who are meeting with FmHA representatives to develop plans to accelerate FmHA guaranteed farm-loan programs by creating an FmHA certified-lenders program. “The goal is to permit greater pri vate participation in FmHA lending and to speed loan service to farmers,” says W. D. W ilier, chairman, ABA agricultural bankers executive com mittee. “We believe an FmHA certi fied-lenders program will reduce the red tape and processing time for a guaranteed loan and encourage banks to participate to a greater degree. ” Mr. Wilier is executive vice president, D e corah (la.) State. The idea for an FmHA certifiedlenders program was broached early last year and a special ABA task force suggested that a certified -len d ers program be based on good bank per formance and that minimum volume requirements be avoided. Through a series of meetings with FmHA representatives, the ABA re commended to Agriculture Secretary John R. Block that a certified-lenders program be established that would qualify banks to handle any FmHAguaranteed farm loan referred to them. Certified lenders, or banking offi cials within those banks, would be knowledgeable and current on FmHA lending practices and policies so loans would be processed promptly and effi ciently. “This program will be a benefit to all participants — farmers, the FmHA and bankers,” says Mr. Wilier. “It has the potential for opening more lending for banks that qualify as certified lend ers as well as the potential for reducing the demand for direct government loans. “The program also could be of ben efit to the Administration by increas ing emphasis on placing FmHA’s loan functions into private lending institu tions and would improve the respon siveness of FmHA and banks in meet ing the needs of farm customers, ” he said. In addition to Mr. Ranger, the ABA team of bankers includes Fred W. Boren, vice president/agricultural rep resentative, National Bank, Pittsburg, Kan.; James R. Eatherly, chairman/ president, First National, Tonkawa, Okla.; Stanley A. Herren, vice presi dent, D eposit Guaranty National, Jackson, M iss.; and John O’Byrne, president, Cresco (la.) Union Savings Bank. Mr. Eatherly is a former chair man of the ABA agricultural bankers division. MID-CONTINENT BANKER for September, 1983 Every financial institution over $25 million should offer equipment leasing. We’ll show you how in two days. Leasing is highly profitable. A lease portfolio has a higher yield than a com mercial loan portfolio. And it’s a service that every bank and savings & loan over $25 million in assets will need to offer in the future to be competitive. By the 1990’s, economists predict that 80% of the country’s capital equipment will be under some form of Lease Agreement. That’s because leases conserve your clients’ working capital, permit 100%financing, and transfer risks of obsolescence to the lessor. We’re experts. First Lease and Equipment Consulting Corpora tion has the know-how and support capability to get you into the profitable leasing business. We have the experience and staff that give you confi dence in offering leasing services. It’s our business — helping financial institutions — so your success is our success. But your clients never need to know that you’re backed by our operations: analysis, accounting support, equipment evaluations, and access to our Guaranteed Residual Program. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Our two day seminar will show you how. At our seminar, in two days you and your officers get a clear understanding of the procedures and benefits of equipment leasing. You find out what it takes to get started and how to negotiate, docu ment and fund an equipment lease transaction. We show you how First Lease experience and service enhance your professionalism and reduce your risks. To reserve your place, call us at [502] 423-7730 or send for our seminar brochure. First Lease 420 Flurstbourne Lane Suite 202 & Equipment Consufting Corp. Louisville, KY 40222 onsulti N am e. Position. B a n k/S a vin g s & Loan. Mailing A d d re ss. C ity _ State. Telephone. Please have one of yo u r p ro fessionals co n ta ct me about Lease C onsulting and O perations Services. Please send m e a b ro ch u re on y o u r E g uipm ent Leasing S em inar: EH Sept. □ 16-17, Kansas City Oct. 21-22, Atlanta EH Jan. 20-21, New O rleans EH M arch 23-24, Nashville EH May 11-12, Louisville Serving the N ew C o nsu m er: A M arketing/Com m unications Perspective By Leonard L. Berry, Professor of Marketing, Texas A&M University, College Station, Tex. T H ERE ARE three increasingly im portant consumer orientations in America of particular interest to banks: • The “ get-m y -m on ey ’s-w orth ’’ consumer. • The “time-buying” consumer. • The “I-am -an-individual” con sumer. Many of your bank’s best customers have all three orientations. Virtually all of them have at least one. Each custom er orien tation req u ires an aggressive marketing and communica tions response. 'Get My Money's Worth' One outcome of the U. S .’s un stable, uncertain economic experi ences of the last 10 years — double digit inflation yesterday, double-digit unemployment today — is that mil lions of American consumers have be come “get-my-money’s-worth” con sumers. These consumers are v alu e co n scious; they are sh op p ers; they think in terms of total use cost (“What will this goods or service cost me over the total period I shall be making use of it?”), not just initial-acquisition cost. T h ese are consum ers who are buying Honda cars and Sony TV sets, who are patronizing discount and offprice retailers, who are buying generic groceries, self-service gasoline, selfassem bly furnitu re and discountbrokerage services. The key to understanding the “getmy-money’s-worth” consumer is to recognize that this consumer seeks the best value f o r the p rice paid, which does not necessarily mean buying the least expensive goods or services avail able. As Florence Skelly of Yankelovich, Skelly & White put it in a recent speech: “Value is ‘what I get, for what I pay.” ’ H ence, a “get-m y-m oney’sworth” consumer may buy unbranded facial tissues that cost less than branded ones and yet are not per ceived to be different materially in quality a n d buy a premium-priced Maytag dishwasher because of its reputation for quality. The central challenge posed to This article is taken from remarks made by Dr. Berry at a recent conference sponsored by the Bank Marketing Association. 52 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis banks by the “get-my-money’s-worth” consumer is that being a transaction/ savings in stitu tio n no longer is enough. “Get-my-money’s-worth” consum ers have learned to consider “tangi bles” — land, homes, collectibles — as an alternative or adjunct to financial instruments and have learned to “go for yield” when they do buy financial in stru m en ts. “ G et-m y -m on ey ’sworth” consumers want to get more fr o m their money when they hold it, not just more f o r their money when they spend it. Millions of “get-my-money ’s-worth” consumers today are investors, not savers! Banks will play a primary role in their investment lives only to the extent that banks become investors’ banks, shifting to a mind-set of “help ing consumers preserve or improve th e ir financial s tre n g th .’’ B an k m arketing and corporate-com m u nications professionals must play a leadership role in facilitating this shift to an investor’s bank, in making it hap pen. The key to being an investor’s bank is viewing co n su m er-liab ilities marketing in terms of marketing “cus tom -investm ent p o r tfo lio s ’ that pro vide varying parts of liquidity, con venience, return, tax sheltering and safety, depending on the specific re quirements and preferences of the in dividual consum er-investor. Some consumers will buy “portfolios” stress ing safety; others, portfolios empha sizing tax sheltering or maximumreturn potential. W hereas the transaction/savings bank focuses on marketing specific de posit services — individual retirement accounts, super NOWs — the inves tor’s bank sits down with the consumer investor and custom packages a port folio of instruments from its line of cash-m anagem ent, risk-free, riskincurring, tax-sheltering, trust and securities instruments. This leads to a second key element in being an investor’s bank. Many “get-my-money’s-worth” consumers need help managing their financial affairs. They need someone to help them put into motion a cohesive, in telligent financial program, someone to explain, to demystify, to present the pros and cons of alternative causes of action, someone to help, to turn to. Successfully providing financial planning/management services will n ot be an easy goal for banks to achieve. In most banks, staff expertise and systems needed for this type of service are not yet well developed. Nor are most banks properly orga nized. The trust department is one business; the retail bank is another, and there is a wall between the two. Turf problems tend to be formidable. Nevertheless, the potential of earn ing additional fee income and market ing a n eeded core service around which a client relationship can be built pro vides considerable incentive to banks for solving these problems and moving in the direction of helping consumers handle their financial affairs better. A principal way banks will be suc cessful in offering these services, in my view, will be to merge the retail-trust and retail-banking organizations and package financial planning, trust and other services in broad menus from which clients select those services de sired and pay only for those selected. It's important to understand the changing consumer, Dr. Berry says. "The fabric of banking in America is changing radically. This is a truly turbulent time for banking, a time when banking and other industries join to form a much broader, highly competitive financialservices industry. This is a time when everyone gets into everyone else's business. Old bank marketing and old bank public relations no longer are enough!" MID-CONTINENT BANKER for September, 1983 W ithout our help, here’s what your em ployees could retain after their securities exam s. There are a number of ways to study for the securities exams. Most involve cramming for the test, then forgetting virtually everything you learned. At Security Schools, we have a better way: Courses that provide a thorough knowledge of the subject— knowledge that your employees will retain and find useful long after the exams. We’re a complete professional licensing service, specializing in real estate, insurance, commodities, as well as securities. We’re the oldest service of our kind in the midwest. We’ll help you determine what licenses are necessary for your company’s growth. Then well make sure your employees are properly trained to participate in that growth. Our courses are thorough, professional, and highly memorable. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Our graduates enjoy an outstandingly high rate of testing success— 85% to 90% of our students pass the testrm their first attempt. And since our classes deal with actual business situations and concentrate on practical securities knowledge, your employees leave our school with the confidence they’ll need to tackle a challenging new job. Call Security Schools today for complete information and current class schedules. Find out how our securities knowledge can go to work for you. The License Prep People. £ | £ | V Security Schools, U l J l In c. Minneapolis — (612) 8 9 4 -6 5 0 0 Milwaukee— (414) 4 6 4 -9 0 4 0 Chicago — (312) 9 2 2 -4 2 6 2 ©1983 Security Schools, Inc. Many of the services would be fee based. These packages would be adminis tered by generalist personal bankers using micro-computer software that eliminates much of the labor intensive ness of financial planning. Generalist bankers would be backed up by a team of tax/investment specialists on call. The principal m arket target for these services would not be wealthy people whose com plex financialplanning needs might outstrip com puter software, but, rather, various middle-market segments; e .g ., dual career households, young profession als, middle-aged affluents, the pre retirement segment. In effect, personal bankers would bring directly to their clients all the resources and services of the bank. In stead of having to deal with different bank units for their different wants, clients would work through their per sonal bankers for such services as an initial comprehensive financial plan, annual financial “ch eck u p s,” taxpreparation services, loans and an in vestm ent portfolio of deposit/nondeposit instrum ents. The personal banker would be the one dealing with other units in the bank or, as needed, with subcontractors. A third element in being an inves tor s bank is provision of financial in formation and education to consumers in ways that go beyond personal, oneto-one delivery. Consumers tend to distinguish between financial counsel ing on the one hand and financial in formation and education on the other. Whereas financial counseling requires more personal means of delivery, financial information and education can be conveyed through a variety of sources, including the media. One of these days, bankers are going to realize that consumer education is a great marketing tool! In an industry characterized by considerable same ness among competitors, consum ereducation program m ing is a way for a bank to differen tiate; it’s a way to en hance a bank s image as a knowledge able source of financial information; it’s a way to demonstrate concern for the well-being of the community and its residents in a manner that reinforces the investor’s bank-positioning strat egy. Consumer education should be a priority activity in a bank’s corporatecommunications program. Advertising campaigns designed expressly to in form and ed u cate; ed u cationally oriented pamphlets available in bank ing offices; a bank-sponsored newslet ter or magazine on consumer/financial subjects; a telephone-based system 54 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis that allows consumers to listen to tapes on various financial topics; customeraccessed terminals in the banking office that provide information on banking services; m icro-com puter software — financial tutorials/simulations — that consumers can work through on their Apples, TRS-80s and IBMs. All these efforts would be of greater value to the “get-my-money’sworth” consumer an d do more for a bank’s image as an investor’s bank than much of the service-specific, salesoriented advertising that banks run regularly. T raditional cornerstones o f consum e r banking — storing, transferring and lending funds — are insufficient today for the bank an d consumer. Many get-my-money’s-worth” consumers are investors, and many near-bank competitors are investment houses! The only way for banks to compete is to become investment houses, too — through m arketing of custom erinvestment portfolios, through per sonal financial-planning services, through consum er-education pro gramming. 'Time-Buying' Consumer A nother significant consum er orientation is the “time-buying” con sumer. These consumers have insuffi cient time to do all the things they need and want to do. In America, there’s a growing sense that there simply is not enough time; there is a growing perception of time scarcity, of a “poverty of time. ” Time is a fixed resource; it is finite. There are 24 hours in a day, and if consumers want to spend more time on certain activities, a new career, more time with children or grandchildren, they must spend less time on other activi ties. The poverty of time is resulting in more consumer behavior designed to preserve it. Consumers with mealpreparation responsibilities are using microwave ovens, food processors and frozen foods. Evidence of time-saving consumer behaviour also shows up in the explosive growth in catalog retail ing, in use of autom atic te lle r machines, in births of personal errand services in some big cities. A priority in banking today is de velopment of “every w h ere” banks that preserve the time of time-buying con sumers rather than waste it. An any where bank is available w h ere and w h en the consum er wants to be served. It not only is easy to get to; it also is easy to get through. There are several key differences between an everywhere bank and a conventional branching bank. One dif ference is the everywhere bank does a better job aligning service-delivery costs with specific customer require ments of the moment. Various facili ties ranging in elaborateness, size and cost are available, depending on w h eth er the consu m er req u ires routine service and is interested in speed, timeliness and reliability, or re quires non-routine services and is in terested in privacy, comfort and exper tise. Another difference is that every where banks, even more so than con ventional branch systems, bring the bank to the customer. The everywhere bank delivers financial services where people already are — to their homes, offices, stores. The everywhere bank is everywhere! The everywhere bank delivers ser vices through a “h ub-and-spoke” approach rather than through a hubonly approach. In a hub-only approach most of a bank’s facilities are full ser vice. In a well-developed hub an d spoke system, cost-efficient spokes reach out to the marketplace, providing ultra convenience and limited services for the most routine transactions and good convenience and additional services for more specialized transactions. Fewer, more costly hubs provide less convenience, but maximum services for non-routine needs. Hubs also might be used by customers located near them and by customers who don’t care about convenience and want to do their banking at a full-service facility. The spokes m ight include offpremise ATMs, small auto-oriented branches with drive-in windows and ATMs, small, but plush, lim itedservice branches in luxury apartments or condominum com plexes, m ini branches in retail stores and malls and in-home banking. There seems to be a rather impor tant role for the corp o rate-com munications function in making the shift to everywhere banking, although it s not an obvious one. First, working together, corporate communications and marketing may be able to educate time-buying con sumers to do their banking more effi ciently. Assuring that the signage in banking offices does a good job com municating with customers so they will know what to do ; developing an ad program educating consumers on how to do their banking in a more timeefficient fashion; distributing to cus tomers a bank directory indicating which bank function should be con tacted for any type of non-routine mat ter (e.g., complaint, lost credit card, incorrect statement) — these are just a MID-CONTINENT BANKER for September, 1983 Rapid transit Speed. It’s the essential ingredient of intelligent m ovem ent of money. It’s also why m ore correspondents choose the rapid transit system at Com m erce. Our day starts with balance reporting at 5 :0 0 A.M. B y 9 :0 0 , w e’re on the phone with custom ers, advising them of how much money is immedi ately available for investment and how much is deferred. Same day available balance reporting coupled with timely information on previous day’s ending ledger balance enables correspondents to manage their funds position accurately and maximize profits. W hat’s m ore, we handle exception items, exceptionally fast. Other banks take weeks to get return item s back to you. Our unique post office box and special zip code allow us to handle these item s quicker. F a st turnaround on return items means less float as well as minimal risk of em barrassm ent and loss. In addition, we have a special problem-solving team for cash letter adjustments. Our Special Adjustment Staff (S.A.S.) pays quick attention to your problems. If an erro r has been made in the checks sent to us for clearing, this special team quickly catches the erro r and adjusts the correspondent for the proper amount. Large dollar adjustments receive immediate priority. Rapid transit at Com m erce adds up to the best availability schedule around. If you’d like to plug into our rapid transit system , call your Correspondent Banker f n m m p „p p R o t-ilr at C om m erce— now. V / \ ^ 0 1 1 1 1 1 1 C lv C f J d ll K No one knows the value of 01 Kansas City (816) 234-2000 • 10th & Walnut • Kansas City, MO 64141 time better than Com m erce. MEMBER FDIC MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 55 few of the steps that can be taken. Second, corporate communications can help gain acceptance of the bank’s electronic-banking program by effec tively representing the consumer’s in terest to management when it comes to such issues as security, privacy, fraud and adoption of user-friendly technology; by assuring that the bank provides consumers a “high-touch”response capability when a problem with the electronic banking system arises and by making sure bank em ployees are kept informed about the bank’s technology plans and are reas sured that machines will not lead to their being laid off. Third, corporate communications might be the impetus for establish ment of an interdepartment commit tee or task force in the bank charged with making banking easier and more time efficient for custom ers. One activity of this group might be an eval uation of existing bank-office operating procedures and policies with the objective of redesigning or eliminating those that cause unnecessary delays. In the 1980s, being an everywhere bank will be more crucial than ever before, but insufficient in and of itself. It will be more crucial because of the growing poverty of time. It will be in sufficient because there likely will be other competitors that are just as con venient. To not be ultra convenient inevitably will mean market-share loss. To be only convenient, to be ab sent other compelling reasons for cus tomers to patronize the bank also will mean market-share loss. 'I Am an Individual' Still another important consumer orientation is the “I-am-an-individual” customer. Responding to the growth of institutional bigness, depersonaliza tion and bureaucracy, a large number of consumers today are fiercely protec tive of their “individuality.” These consumers want to express their indi vidualness, want to be themselves, not somebody else, want to be treated as individuals, not as computer numbers. E x isten ce of the “I-am -an-individuaf consumer is fueling growth in goods and services that allow for ex pression of individual creativity; for ex ample, 35mm camera equipment. Existence of this kind of consumer First Corporate Trade Payment Processed by Bank Through N ACHA T HE NATION’S first inter-regional corporate trade payment (CTP), a new form of transaction designed to simplify and speed up fund and information transfer between companies, was processed recently by InterFirst, Dallas. Sears, Roebuck & Co. and Black & Decker were the two participants in the initial CTP. These firms and InterFirst were among a handful of corporations and banks that helped in the development of the CTP system. CTPs are processed through the National Automated Clearing House Association (NACHA) network. Sears initiated payment through InterFirst when payment informa tion on magnetic computer tape was received from the retailer’s accounts-payable department. InterFirst verified, edited and processed the information and sent it to the Dallas Fed. The Dallas Fed then verified the transaction and sent it to the Richmond (Va.) Fed, which transferred the information to its branch office in Baltimore. There, the settlement process was completed when the Baltimore branch notified Black & Decker’s bank, First National of Maryland, Baltimore. The system’s major advantage, say proponents, is the elimination of float. On the transfer date, settlement — in the form of immediately available funds — occurs simultaneously for all parties, thus eliminating float time in most Federal Reserve payment-system transactions. Although exact figures are unknown, some estimates place the aver age Fed float at about $2 billion annually. The Monetary Control Act of 1980 mandated that the Fed eliminate or price for float, but use of CPTs may help to eliminate the possibility of banks passing on float charges to customers. Support documentation for a payment is transferred along with the payment. Invoices, account records, or shipping information accompa nies the fund transfer, reducing paperwork volume, time lags and errors. CPT development began in 1980. It is based on programs used in the existing NACHA system. 56 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis has prompted retailing researchers to be optimistic about the future of spe cialty stores inasmuch as such stores tend to be particularly well suited to provide the customized and knowl edgeable personal service appropriate for certain lines of trade. For many service industries — banking included — the “I-am-anindividual consumer defines service quality in part by the extent to which the service is personalized and indi vidualized. W hat seem to be “little things” to a b a n k e r — recognizing cus tomers and referring to them by name, calling good customers rather than bouncing checks and sending little green slips in the mail, sending good customers a note from time to time thanking them for their business — turn out to be “big things” for “I-aman-individual” consumer. The challenge in banking is to trans form banks from order-taking institu tions that sell one or two services to customers over a short time to rela tionship banks that sell five or seven services to clients over a long period. Relationship banking emphasizes client retention and enhancement, not just new client acquisition, and the satisfaction of total financial-service needs, not just bits and pieces of these needs. In a sentence, relationship banking is attracting, maintaining and enhancing client relationships. In a relationship bank, servicing and selling existing clients are viewed to be ju st as important to long-term marketing success as acquiring new clients. Good service is necessary to retain relationships. Good selling is necessary to build them. The market ing mind-set is that the attraction of new clients merely is the fir s t step in the marketing process. Cementing the relationship, transforming indifferent customers into loyal clients — this is bank marketing, too. Banks are interested in relationship banking because of the economics of selling five services to one customer instead of one service to five customers and because it is wasteful to turn over customers constantly. At the same time, “I-am-an-individual” consumers are in terested in being served as clients, rather than as “faces in the crowd.” Herein lies the central task: organizational functions like marketing/corporate communications helping the bank to become proficient in the art of client banking. Recoming a relationship bank is not done easily. There must be a strategic approach in which at least five key ele ments are present and carefully coor dinated. F irst, the bank must becom e a MID-CONTINENT BANKER for September, 1983 The Smart Money is Heading to Atlanta 68th Annual Convention of the Bank Marketing Association The good news is, deregulation is going to make marketing people the heroes off the banking industry. The bad news is, heroes aren’t allowed to fail. Which means that marketing will not only be expected to make a greater contribution to bank profitability, it will also be held more accountable. That’s why the smart money is heading to Atlanta in October. To get a crash course on what marketing people can do to insure their own success and the success of their banks. It’s the 68th Annual Convention of the BMA, and the cynics among us are already calling it a survival course. Here are some of the highlights: ■ Presentations from non-banking executives who have fought the battle of deregulation. And won. Which gives us a chance to learn from them, instead of reinventing the wheel. FOR FULL DETA ILS CALL S H IR L E Y A N TE N U C C I AT (3 1 2 ) 7 8 2 -1 4 4 2 . t o BANK MARKETING ASSOCIATION 309 W. Washington St. Chicago, IL 60606 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ■ A fascinating analysis of the trends that are shaping our lives and our futures by John Naisbitt, author of the current best-seller MegaTrends. ■ For perhaps the first time in history, the presidents of three Federal Reserve Banks on the same podium, discussing the future of our industry from their unique perspective. ■ Workshop sessions developed along five different tracks. You can follow one track all the way through, or you can mix ’n match. ■ “ How To” sessions, which you’d expect, and “ Why To” sessions, which you might not expect. So, you can not only learn the nuts and bolts, you can also explain the concept to top management. And t BANK MARKETING ASSOCIATION that might be the most important thing you’ll ever learn. ■ We’ve left room for a red-hottopic session. Nobody knows what it’ll be about, but you can bet that by convention time the rumor mill or DIOC will have given us all something to talk about. ■ And, apropos to our Georgia convention site, we’ve put together a peach of a program on the social side. For you and your spouse. So, before you do anything else today, send in the attached response form for further information and a convention registration form. And join the smart money in Atlanta. Name_____________________________________________ ________ Title_________________________________________________— ------Institution_______________________________________ __________ Address_____________________________________________ ______ C ity__________________________________ State ____________ Zip Phone ( o )--------------------------------------------------- ------------------- segm enter institution, since it’s more practical to seek relationships with de finable market segments whose specif ic wants can be identified and then satisfied. Building genuine client rela tionships requires that a bank perform at a superior level, and this, in turn, requires a focusing of resources. Being a segmenter institution does not mean that a bank must close its doors to all customer-prospects falling outside the boundaries of a chosen market segment. Rather, it means the bank makes a strategic commitment to knowing far more about the wants of selected segments than do competing institutions and, using this in-depth knowledge, finding innovative ways to attract a “more than normal” share of business from these segments. Second, there must be a core service around which the relationship can be built. The ideal core service attracts new business by addressing important unmet needs of the market segment, cements the business through its qual ity and multiple component parts and enhances the relationship over time by providing a platform from which addi tional services can be sold. W ellexecuted financial-planning packages are especially promising in this regard. A third vital element is the account representative: someone the client can THE CITIZENS NATIONAL BANK OF DECATUR ILLINOIS’ LARGEST BANK DATA PROCESSOR »SERVING OVER 75 BANKS FROM DECATUR AND QUINCY CENTERS. A COMPLETE OFFERING OF APPLICATIONS — BOTH BATCH AND ON-LINE. ' SERVING OVER 145 BANKS WITH CORRESPONDENT AND/OR DATA SERVICES. SERVICE THAT IS CLOSE — FAST — AND PROFESSIONAL — BUT NOT ‘BIG CITY’! CALL US FOR PROMPT ATTENTION: 217/424-2202 BILL IRWIN — DATA SERVICE 217/424-2061 DALE P. ARNOLD — CORRESPONDENT 217/424-2037 JACK DOLAN — CORRESPONDENT 217/424-2063 DAVE WEBER — CORRESPONDENT Fa THE CITIZENS = * NATIONAL BANK OF DECATUR LAN D M AR K MALL DECATUR, ILLINOIS 6 2 5 2 5 W t'h t I w iJ it ù 'k e b M em ber F D IC turn to when the need for non-routine service arises. The account repre sentative is the liaison between the bank and client, the relationship bank er who knows the client’s require ments and who can satisfy them. The account representative provides the necessary high-touch response capa bility for there truly to be a “rela tionship. M achines alone cannot make relationships. Fourth, bank services need to be priced to provide incentives for clients to consolidate much or all their finan cial business with one institution. There are several approaches to rela tionship pricing. One is to discount loan rates or service fees to clients maintaining a certain level of business with the bank. A second approach is to make available certain “special” ser vices only to customers maintaining a certain level of business with the bank. Afifth element in relationship bank ing involves training an d educating bank personnel. Staff training and education are critical because staff competence is an essential ingredient in foregoing client relationships. No client wants a relationship with an in competent banker. Also, personnel the bank most wants to keep, person nel with intelligence, motivation and interpersonal skills to be good rela tionship officers, will be the ones who will most want to grow in their work, the ones who will want to develop their skills and knowledge continually. “I-am-an-individual” consumers are out there in the marketplace. A key in attracting, keeping and building their patronage is treating them like clients. We hear and read so much about the plight of the community bank in a de regulated era. What is overlooked in these discussions is that the wellmanaged community bank is well posi tioned to treat the “ I-am -an -individual” consumer as an individual. Perhaps, this is one of the main reasons there are hundreds of banks in Califor nia today rather than 10 or 20. C o n c lu s io n . “ G et-m y-m on ey’sworth,” “time-buying” and “I-am-anindividual” consum er orientations have far-reaching im plications for banking. As already mentioned, a sin gle consum er may have all three orientations. The same consumer may be investing in land, tax-free bonds and money-market instruments, be highly convenience oriented when it comes to routine transactions and in sist on individualized treatment when it’s a banker, not a bank machine, that is needed. Understanding this changing con sumer is important. The fabric of bank- 58 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis MID-CONTINENT BANKER for September, 1983 Nothing Reaches Your Financial M arket Like United States Banker Every banking institution with assets of $50,000,000 or more is covered. That’s 90% of the market. For a complete media file, return the coupon below or call Angela Moran at (203) 661-5000. Senior officers in commercial banks, savings & loan associations, mutual sav ings banks, insurance companies, credit unions, investment and finance firms all read United States Banker. The in-depth analysis of current financial issues makes U.S. Banker essential reading for these leading executives. Please send a complete media file on United States Banker to: Mid-C Name_________________________________________ Title ______ __________________________________ Company _____________________________________ Address _ _ ------------------------------------------------------City___________________ State________ Zip________ Tell your story in this authoritative editorial climate to a dynamic and recep tive audience. Why segment your adver tising effort when you can sell all the most important areas of your financial market in U.S. Banker? MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Telephone___________________________ _________ Return coupon to: United States Banker One River Road, Cos Cob, CT 06807 59 ing in America is changing radically. This is a truly turbulent time for bank ing, a time when banking and other industries join to form a much broader, highly competitive financial-services industry. This is a time when everyone gets into everyone else’s business. Old bank marketing and old bank public relations no longer are enough! Federated Investors, Inc., a large Pittsburgh based Financial Services Firm has current openings for Marketing Representatives in various regions throughout the United States. These individuals will introduce and service Cash Management Systems to Financial Institutions, in two different capacities. largest collection of barbed wire, which was on display in the bank’s lob by. Exhibited in the shape of trees, arrows, stars, bow ties and other un usual designs, the barbed-wire crea tions were mounted on English linen and exhibited in glass-encased oak shadow boxes. The collection represents a portion of 12,000 wires collected from more than 70 countries. “Barbed wire re flects American ingenuity at its best,” says Robert Campbell, exhibit owner. “It’s a bit of Americana that can be found in no other medium.” Asset Management Representatives In d e x to A dvertisers Cherry Creek Nat'l Employees 'Fenced In' During Show Did employees at Cherry Creek National, Denver, hum “Don’t Fence Me In” while taking care of bank busi ness this summer? It would have been appropriate since they were sur rounded for six weeks by the world’s BANKERS Candidates for these positions will have 3-5 years in Bank Portfolio Management. AgriCareers, Inc...................................................... American Bank & Trust Co., Baton Rouge, La .. American Bank Directory ..................................... Arrow Business Services, Inc................................ Trust Representatives • 62 45 60 37 Diana L. Fraser Bancvest Brokerage S ervice................................. 47 Bank Board L e tte r........................... 61, S/18, S/31 Bank Building Corp................................................... 3 Bank Earnings International ............................... 4 Bank Marketing Association................................. 57 Bank of America, San Francisco......................... 23 Bankers Trust Co., New York City ..................... 6-7 Banking Consultants of America ......................... 43 Boatmen's National Bank, St. Louis ................. 64 Brenner Steed Partner Plan ................................. 39 Bunce Corp.............................................................. 38 FEDERATED INVESTORS, INC. 421 SEVENTH AVENUE PITTSBURGH, PA 15219 Centerre Bank, St. L o u is ..................................... S /l Central Bank of the South, Birmingham, Ala. .. 32 Citizens National Bank, Decatur, III..................... 58 Cole-Taylor Financial G roup........................... 34-35 Trust candidates will have 3-5 years Asset Management in a Trust Department. We are looking for experienced banking professionals with excellent communication skills, professionalism and a willingness to travel. NASD Series 7 and Blue Sky registra tion helpful. These are salaried positions and we offer compensation commensurate with your experience. Please send resume and salary requirements in complete confi dence to: An Equal Opportunity Employer (C ontinued on page 62) Designed for the busy executive — The nation’s newest and most com prehensive Financial Institutions Directory is now available. McFadden’s new Savings Directory when combined with its American Bank Directory becomes a handy 3-volume directory of American Financial Institutions. Each listing contains: city, population, mailing address, memberships, phone numbers, top officers/titles, financial data and much more! COMPLETE DIRECTORY — American Financial Institutions — Yes, I want all the nation’s top financial institutions in one complete directory: □ Send m e ______ copies of the current AFI @ $165 ea. □ Enter standing order for each Spring AFI @ $133 ea. □ Enter standing order for each Spring AFI @ $116 ea. and stand ing order for Fall American Bank Directory @ $66 ea. (plus shipping and handling) SAVINGS DIRECTORY — American Savings Directory — Yes, I want to add this volume to my library to include savings and loans, mutual sav ings banks, major credit unions and money market funds. □ Send m e ______ copies of the current ASD @ $65 ea. □ Enter standing order for each Winter ASD @ $50 ea. □ Enter standing order for each Winter ASD @ $50 ea. and stand ing order for Fall American Bank Directory @ $83 ea. (plus shipping and handling) □ SEND ME MORE INFORMATION PLACE YOUR ORDER TODAY! Mail to: McFadden Business Publications, 6195 Crooked Creek Rd., Norcross, GA 30092. COMPANY NAME ADDRESS 60 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis STATE ZIP MID-CONTINENT BANKER for September, 1983 T h is F o u r- V o lu m e MARKETING LIBRARY Regular Price $55.00 NOW O N LY ^ O / . J U How to Plan, Organize and Conduct an Incentive Campaign . . . Mid-Continent Banker's newest how-to-do-it manual; a complete guide to procedure in evolving an effective in centive campaign to sell bank services and/or increase bank deposits; 96 pages, 16 illustrations; starts by telling you premium terms and the history of incentives, roams through such topics as trade area studies, tying in with cur rent events, getting new business from old customers, m oti vating staff members and concluding with a series of six case histories of actual bank promotions that obtained ex ceptional results. Regular Price: $ 1 4 .0 0 Profit-Building Ideas for Bank Christmas Promotions. This is NOT a Christmas Club book, although ONE chapter is devoted to Christmas savings promotion plans. Other chap ters: selling various bank services during the Holidays: using lobby decorations most effectively; helping children at Christmas; remembering employees in Christmas planning; using the "good w ill season" to build bank good w ill; get ting the most benefits from Holiday publicity; planning for the Holidays from mid-summer to New Year's. In 80 pages are packed tested Holiday ideas used by banks, big and small, from coast to coast. Regular Price: $ 1 0 .0 0 How to Plan, Organize & Conduct Bank Anniversaries. . . The complete guide to procedure when holding a formal opening, an open house, any kind of bank celebration; 166 pages, many illustrations; 12 chapters starting with "F irst Things F irst," ranging through "A dd a Little Pizazz and Oom-pah," concluding with " Expect the Unexpected"; eight appendices containing actual plans, budgets, programs used by banks in actual celebrations; a completely factual, step-by-step how-to-do-it book now in its second printing. Regular Price: $ 2 2 .0 0 M O N E Y B A C K G U A R A N T E E — If not c o m p le t e ly satisfied, retu rn w i t h i n 10 days f o r ful l ref u nd . r M, ID -C O N T IN E N T BANKER 408 Olive, St. Louis, Mo. 63102 Please send us books checked: copies, Bank Celebration Book @ $22.00 ea. copies, Bank Publicity Book @ $9.00 ea. copies, Planning an Incentive Campaign @ $14.00 ea. copies, Profit-Building Ideas for Xmas @ $10.00 ea. How to Write Bank Publicity and Get It Published. . . The complete guide to procedure in writing publicity releases and how to prepare them so that newspaper and magazine editors w ill use them; 61 pages; 12 chapters with titles such as " Constructing the News S tory," "Placing the News S tory," "Handling 'S ticky' Situations," "Dealing with News Media"; another completely factual, step-by-step how-todo-it manual. SEND ALL FOUR BOOKS AT THE LOW PRICE OF $37.50 [ ] Check enclosed.................................................................. ... . . . Nam e...................................................Title B a n k ............................................................ Street................ City, State, Zip (Check should accompany order. We pay postage and handling. I Missouri banks please include 4.6% sales tax.) Regular Price: $ 9 .0 0 MID-CONTINENT BANKER for September, 1983 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 61 INVENTIONS WANTED Inventions, ideas, new products wanted for presentation to industry and exhibition at national technology exposition. Call toll free 1-800-528-6050. Arizona, call 1-800-352-0458, extension 831 or write: IMI-MCB, 701 Smithfield, Pittsburgh, PA 15222. BANK POSITIONS Sr. Comm’l Loan ....................................... O perations.................................................. Agri-Loan .................................................... Real Estate Loan ...................................... Commercial L o a n ....................................... C a s h ie r........................................................ Corresp. Officer ........................................ C o n tro lle r.................................................... A gri-R e p...................................................... $45K $30K $28K $35K $35K $28K $38K $35K $24K All inquiries confidential. Resumé and salary re quirements requested. TOM HAGAN & ASSOCIATES of KANSAS CITY P.0. Box 12346/2024 Swift North Kansas City, MO 64116 8 1 6 /4 7 4 t6 8 7 4 SERVING THE BANKING INDUSTRY SINCE 1970 Commerce Bank, Kansas City............................... 55 Commercial Credit Business Loans, Inc.............. 21 Commercial National Bank, Kansas City, Kan. 35 Commercial National Bank, Peoria, III................. 49 Continental Bank, C hicago............................... S/15 County Tower Bancshares ................................... S/9 Deposit Guaranty National Bank, Jackson, Miss................................................... S/17 Douglas Guardian Warehouse Corp....................... 50 Federated Investors, Inc........................................ 60 Financial Placements ........................................... 62 First Alabama Bank, Montgomery, Ala............. S/30 First Lease & Equipment Consulting Corp........... 51 First National Bank, C hicago............................... 25 First National Bank of Commerce, New Orleans 29 First National Bank, Kansas City ................... S/19 First National Bank, Louisville ........................... 19 First National Bank, St. Joseph, Mo................. S/27 First National Bank, Shreveport ..................... S/21 First Oklahoma Bancorporation ......................... S/5 2 First Total Systems, Inc......................................... Fourth National Bank, Wichita ....................... S/29 Frost Bank, San Antonio, Tex............................... S/7 H B E Bank Facilities Corp.............................. 26-27 Hagan & Associates, Tom ................................... 62 Florizons 60 .......................................................... 41 Insured Credit Services, Inc.................................. 11 Laacke & Joys ...................................................... LeFebure Corp......................................................... Liberty National Bank, Oklahoma C ity ................ Littlewood, Sham & Co.......................................... Loews L’Enfant Plaza Hotel ................................. 30 63 2 17 50 Mellon Bank, P ittsburgh....................................... 12 Mercantile Bancorporation, St. L o u is .............. S/23 • CEO: One unit of a two-bank holding company needs person with 3-5 years current ag lending experience to service existing loans and develop business. Have second person to handle operations. Individual must be growth and marketing oriented. Excellent location. $30$40,000 salary and good growth potential. • Vice President needed in medium sized bank with $12 + million ag loan portfolio. Will work 85% in loans (on-farm inspections, cash flows, etc.) and 15% operations. Must have B.S. in Ag Business, strong farm background, accounting skills, sales personality and professional appearance. $20-$25,000 salary + excellent benefits. • President/Chief Operating Officer for large bank. Re quires top credentials and solid record of experience in loans, operations and P.R. as head of or second man in $30-$100 million bank. Must be currently employed and have long term record with no more than two banks. $50-$55,000. • Ag Loan Officer for $50 million bank with $10 million in ag loans. Will assume responsibility for ag loans, call pro grams, farm inspections, and new business develop ment. Requires 3 yrs. ag lending experience with bank, PCA, FLB, or FHA. $20-$30,000 + benefits. NATIONWIDE BDfl CAREERS, IN C I F in a n cia l P la c e m e n ts is b u ilt on a h isto ry o f stro n g re la tio n sh ip s b e tw e e n b a n k e rs a n d B a n k N e w s' p u b lica tio n s. Y o u can b e n e fit from th e se re la tio n sh ip s — p lu s th e m ore th a n 65 y ea rs o f b a n k -re la te d e x p e rien ce of th e se tw o m en — by u sin g ou r sp e cia liz ed e m p lo y m e n t serv ice. Call us! We can help find the right person or the right position. 816 421-7941 - Tom Cannon Associate FIN A N C IA L PLA C EM EN TS 912 Baltimore 62 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Travelers Express .................................................. 32 Union National Bank, Little Rock ................... S / ll United Missouri Bank, Kansas City ................... 31 United Oklahoma Bank, Oklahoma City ............ S/3 United States Banker ........................................... 59 Visa, U.S.A.............................................................. 9 Whitney National Bank, New O rleans.............. S/25 Financial Buyers Guide Index Actron, Inc........................................................ BG/21 Bank Board Letter .. BG/13, BG/17, BG/20, BG/23 Barclays American Business Credit .............. BG/14 Bavis & Associates, Inc., E. F........................... BG/9 Beemak Plastics ............................................ BG/18 Belmont Plastics ............................................. BG/11 Bronner’s Christmas Decorations ................. BG/10 Cummins-Allison Corp ................................... BG/11 Daktronics, Inc................................................. BG/10 Downey Co., C. L................................................ BG/7 Federal Sign ...................................................... BG/2 Financial Advertising Agency ....................... BG/22 Financial Institution Services, Inc.................... BG/5 Hyde Park Metalfab, Inc.................................. BG/15 National Computer Print, Inc.......................... BG/18 P M Ind ustrie s................................................ BG/19 Piedmont Software Co........................................ BG/6 Security Engineered Machinery ................... BG/14 Systematics, Inc............................................... BG/24 Wilson Premium Corporation......................... BG/22 AND THE ORIGINAL AGRICULTURAL RECRUITER Banking Career Specialists Mike Wall Manager Security Schools, Inc............................................. 53 Stern Brothers & Co............................................ S/26 FIELD SALES CONFIDENTIAL. Fees paid. Call for details: Jean: 712-779-3567 • Linda: 515-394-5827 Ag Banking Specialists • Massena, IA • New Hampton, IA — National Boulevard Bank, Chicago ..................... 29 Northern Trust Co., Chicago ............................... 31 Gold Medal Products........................................ BG/21 Grandma’s Master Fruit Cake ....................... BG/19 B A N K E R S N EED E D ' Midland Bank & Trust Co., M e m p h is.............. S/12 Missouri Encom, Inc........................................... S/32 a division of BANK NEWS Kansas City, MO 64105 MARKETING A leading provider of professional services to the financial services industry is seeking an exceptional professional to manage a regional office soon to be opened in Cincin nati. This individual will be re sponsible for marketing our prod ucts and services in a multi state area and maintaining liaison with our business base in this area. Qualified individuals will have at least five years experience selling and marketing to the banking in dustry, appropriate undergraduate degree, strong interpersonal and communications skills and the abil ity to operate independently. Ap proximately 40% travel will be re quired. Our preference is toward candidates residing in the Cincin nati metropolitan area. BOX 99-M, c/o Mid-Continent Banker 408 Olive St., St. Louis, MO 63102 MID-CONTINENT BANKER for September, 1983 Meet MAX He’s thrifty. He’s reliable. But best of all, he’s from LeFebure. Introducing MAX ...the best mechanical drive-up system available today. That’s because MAX is LeFebure bred and design engineered to save you money by staying on the job. Year after year. MAX is first cousin to the pneumatic Tel-Air systems the standard of the industry. Like Tel-Air, MAX comes with an excellent two-way continuous sound system. That’s no reason inexpensive has to mean cheap. MAX gives you something other mechanical systems don’t. LeFebure’s planning and service resources. The difference is a lasting https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis commitment to your satisfaction. Let your LeFebure Sales Engineer help you get better acquainted with MAX. Then compare him with others on the market. You’ll like the way he saves you money. i LeFEBURE I Division of Kidde. Inc ' KIDDE I | Cedar Rapids, Iowa 52406 Phone (319) 366-2771 j Rush FREE literature to me about MAX. My business card is attached. ' □ Have a LeFebure Sales Engineer contact me. j i j | B IN IDEAS 1S T From “Now” A cco u n ts to R egu la tio n In fo rm a tio n . . . Don Shay, Executive Vice President, University Bank o f Carbondale, with Russ Spaulding, Correspondent Banking Officer, Boatmen’s A B o a tm e n ’s C orrespondent B a n k e r ca n assist y o u . Call R uss S p aulding to d ay . 3 1 4 -4 2 5 -3 6 0 0 • O v e rlin e s Member FDIC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis • I n v e s t m e n t s • P r o c e s s in g • S to c k lo a n s • F e d e r a l F u n d s O p e ra tio n A s s is t a n c e • R e g u la t io n In fo r m a t io n • Correspondent Banking Division THE BOATMEN'S NATIONAL BANK O F ST. LOUIS 314 - 425-3600
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