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Vol. 11 No. 16 Des Moines, Iowa South Dakota Banks Prove Their Point! By BEN H A LLE R , JR. Editor and Publisher T HE MESSAGE that came from bank customers in South Dakota last week to the DIDC in Wash ington, D.C., was loud and clear: “ We want a fair return on our money and when we get it we prefer to keep our business in the local bank!“ That point was emphasized when three South Dakota banks challenged the federal regulators by taking ad vantage of a Super NOW account approved by the South Dakota Banking Board, which became effec tive Wednesday, July 28. The ac count has a minimum $5,000 depos it, but no regulated interest rate ceil ing. The first bank to break the ice was American State Bank of Pierre, in the state’s capital, which began offering the account July 28. The se cond was BankWest, N.A., also in Pierre, which offered it on Monday, August 2. The third bank to an nounce its plans was SunBank of South Dakota, Sioux Falls, which said it would offer the Super NOW August 9. American State Bank is a $9 mil lion deposit institution headed by James Kelly, president. He braved the regulator storm that had been threatened ahead of time by the Fed eral Reserve Bank of Minneapolis and the FDIC and began offering the Super NOW when the bank opened its doors July 28. Before the Fed got him to agree in a “ memo of understanding’ ’ to cease offering the account effective Monday, August 2, American State Bank opened sev en accounts totaling $113,000. The first three accounts, Mr. Kelly said, totaled $33,000 “ and the bulk of that came out of Money Market Funds,’ ’ he stated. Mr. Kelly said he was so busy after that with phone calls from Fed officials that he hadn’t had time to review the other four accounts and determine the source of funds. The seven accounts were opened the first three days. The Minne apolis Fed contacted him almost im mediately on Wednesday, July 28. He agreed to send Sheldon Azine, vice president and deputy general counsel, the American State’s dis closure document, contract and forms. Mr. Kelly received a letter July 30 from the Fed requesting him to cease offering the account. He re sponded on the phone by saying his bank counsel, who had been out of town until noon that day, needed time to review the regulations, the bank’s action and the Fed’s request. The Fed agreed to this and the bank opened no more acounts after that date. August 9,1982 The American State attorney ad vised Mr. Kelly of the potential loss of Fed membership and FDIC insur ance, as well as the potential for fi nancial penalties, loss of employ ment for the bank’s officers and loss of position for the directors. “ I called Sheldon Azine at the Fed and asked him what he could do to us,” Mr. Kelly recalled. Mr. Azine said the Fed could fine the bank $100 per ac count, per day, per officer, per bank, per director. For the seven accounts, this could total nearly $10,000 per day. Mr. Azine said the Fed was not considering loss of Fed membership arid doubted he could lose his FDIC coverage, Mr. Kelly recalls; how ever, the bank’s attorney said loss of insurance was still a possibility. “ I felt we had made our point,” Mr. Kelly emphasizes. “ We bankers have been trying to obey every one of these rules. There’s hardly a day you come to the office that you can’t be held technically in violation of some regulation. I never intended anyway to carry this to the point where we would be in violation of federal law. Our aim was to get the message back to those people in Washington. We could not get the DIDC to acknowledge we were here, but as soon as we ‘got out of line’ the force of federal government moved in fast.” Like many thousands of other banks, Mr. Kelly made reference to Treasury Secretary Donald Regan A S K STA N FA R M ER to make MNB work for you. Toll free: 1-800-332-5991 Merchants National Bank m Member F.D.I.C. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis A BANKS OF IOWA' BANK 2 Team w ork: O ne of the reasons we’re first in Iowa. Dorothea Wolfe Cyndi W atkins W ire Transfer An Affiliate of Northwest Bancorporation Member FDIC and his distinct conflict of interest in holding the post of chairman of the DIDC. “ I would have liked to have seen about 100 banks in South Dakota join us in doing the same thing on the first day (July 28),” Mr. Kelly stated. In line with the “ memo of under standing,” American State Bank converted the seven Super NOW ac counts to “ an account under ap plicable law.” In this case, they were converted to repos. The rate given the seven accounts on the Super NOW was 10.559%. The rate on the 14 day repos is 11%. American State has successfully offered repos for the past one and one-half years and has gathered $1.5 million from this source. “ They are not insured,” Mr. Kelly states, “ and they are cumber some, but our customers keep their money here at that rate once they are in the repo program. We have found we were competitive with the M M MFs within one-half percent. A ll our customers are looking for is a reasonable return, and 5*/4% today is not a reasonable return.” Charles Burke, president of BankWest, N.A., Pierre, said his bank began offering the Super NOW Monday, August 2, as it had stated it would. “ By noon that day,” he recalls, “ we had a letter from the Regional Administrator of National Banks out of Minneapolis, which had been mailed Friday. It said, ‘We understand you’re considering this,’ B anco Call (515) 245-3131 or toll-free (800) 362-25 14 then they listed all the penalties the Comptroller and Fed could impose. I responded to a phone call from the Comptroller’s office that afternoon and verbally agreed we would cease offering the plan that day.” BankWest opened nine accounts totaling $180,000. Like Mr. Kelly, Chuck Burke had a number of other customers call or stop him regarding the account, giving evidence of keen interest of customers in retaining their funds at the local level. American State called its plan the Money Market Account: With the agreement of the nine customers, the money was converted to Bank W est’s repo program, and continued under the name of Money Market Account. The Super NOW was ac cessible by check; the repo can be ac cessed by draft. The Super NO W re quired $5,000 as a minimum; the Money Market Account now re quires $3,000 minimum opening ac count and $500 in additions. The ac count draws 12% interest, the same as the original M M A (or Super NOW). BankWest had an ad scheduled in the afternoon Pierre newspaper ad vertising availability of the new Super NOW, urging people to open the new account on Tuesday. Those customers had to be told the plan was ordered withdrawn, but they could deposit funds in the repo ac count. An interesting sidelight was a phone call Mr. Burke received at 5 p.m. on Monday, August 2 as he was Single System Banking With Availability Availability of funds. . . availability of people. . . responsive to your needs. National Bank of Waterloo Waterloo, Iowa 50704 Member FDIC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis « V I Phone Bill Rickert at 1-800-772-2411. ready to leave the office. “ It was a man calling from north of San Fran cisco who said he had read in the Wall Street Journal about what we were trying to do here and sup ported us. He said he places money in banks and was tired of having a middle man. He had $50,000 to in vest. I thanked him and told him we had to discontinue the plan. ’ ’ □ # • Iowa News AM ES: Larry Wenzl of Des Moines heads a group that has contracted to purchase University Bank & Trust Co. here. The application to federal regulatory authorities is being pro cessed. Mr. Wenzl is chairman of Hawkeye Capital Bank & Trust, Des Moines. He recently purchased Panora State Bank and is awaiting final approval on that transaction. He also has banking interests in the cities of Galesburg and Girard, 111. DES M OINES: Kenneth M. Myers, chairman of United Central Bancshares, Inc., and chairman of United Central Bank of Des Moines, N.A., responded to a $3.1 million lawsuit against the two institutions by stating that the complaint “ contains both distortions and misstatements of fact.” The lawsuit was filed by University Bank & Trust Co., Ames. Its suit alleges several viola tions of securities laws in connection with two transactions in late 1981 and early 1982 made directly with United Central and one transaction apparently consummated directly with Gary Llwewllyn, who is under indictment for misappropriation of funds from the now defunct First National Bank of Humboldt. Mr. Myers said “ the transactions were usual and normal in the course of business and the facts at a trial will support that. We will conduct a vig orous defense.” HUM BOLDT: Robert P. Ritson, executive vice president of Citizens National Bank, Boone, has been named president of Hawkeye Bank and Trust of Humboldt, as of Au gust 2. Both banks are members of the Hawkeye Bancorporation. L A PORTE: An agreement has been reached for the merger of the La Porte City State Bank into Peoples Bank and Trust of Waterloo, with an office being retained in La Porte. The merger awaits approval from the Iowa department of banking and other regulatory authorities. No per sonnel changes are planned. # • • ® _ ^ ^ ^ ^ q £ f • • DATED: June 1,1982 DENOMINATION: $5,000 Both principal and seminannual Interest (June 1 and December 1, first coupon due December 1,1982) payable at the Office of the City Treasurer, Keokuk, Iowa. • IN THE OPINION OF COUNSEL INTEREST ON THESE BONDS IS EXEMPT FROM ALL PRESENT FEDERAL INCOME TAXES. MATURITIES $ 75,000 90,000 100,000 110,000 125,000 140,000 155,000 175,000 11.00% June 1, 1983 June 1, 1984 June 1, 1985 June 1, 1986 June 1, 1987 June 1, 1988 June 1, 1989 June 1, 1990 8.30 8.80 9.20 9.50 9.75 10.00 10.25 10.50 $ 195,000 10.70% June 1, 1991 10.70 $ 215,000 10.90% June 1,1992 10.90 $4,120,000 101/4% June 1, 2002* 10.25 ‘ Term Bonds: Callable June 1, 1992 at 100%. # “ Par payment at bondholders option (term bonds):-June 1, 1985. LEGALITY TO BE APPROVED BY AHLERS, COONEY, DORWEILER, HAYNIE & SMITH, ATTORNEYS DES MOINES, IOWA The City of Keokuk, a county seat of Lee County, is located on the Mississippi River in the southeasternmost section of Iowa, about 175 miles southeast of Des Moines and 240 miles southwest of Chicago. The City has served since its incorporation as the commercial, governmental, industrial, financial and transportation center for Lee County and the surrounding area. In addition to its prominence as a commercial and trading center, Keokuk and Lee County serve as the home of many local and national industries, including: Decker Manufacturing Co. (solar heater window heater and panels, curry combs and hog ringers); Foote Mineral Company (producers of ferrosilicon and high silicon silvery pig iron); Hubinger Co. (a Division of H.J. Heinz Co., processors of corn syrup and starch, corn gluton, feed and meal) and Henkel Corporation (formerly General Mills Chemicals; producers of wheat protein and starch). Transportation is provided by three railways, U.S. Highway 61 and ^ 218 and commercial airline service is provided in Burlington, thirty-five miles from Keokuk. There are three commercial banks with combined dew posits over $128,300,000 and one savings and loan association with total assets over $53,354,471. The current population is estimated at 13,536. The Series 1982 Bonds are being issued to refund outstanding Water Revenue Pledge Orders, which Water Revenue Pledge Orders had heretofore been issued and the proceeds therefrom used to defray the cost of necessary improvements and extensions to the Municipal Water Works Plant and System of the City. a SUMMARY OF FINANCIAL TRANSACTIONS Total Revenues • Total Expenses Net Revenues Coverage: Maximum Annual Principal &Interest Average Annual Principal &Interest 1981-82 Pro forma $2,097,848 1,010,756 1,087,092 _____________ PROJECTED 1982-83 1983-84 $2,216,635 $2,614,479 1,198,510 1,300,979 1,018,125 1,313,500 1.54x 1.62x 1.44x 1.52X 1984-85 $2,805,337 1,437,337 1,368,000 1.86x 1.96X The information contained herein is not guaranteed, but is derived from sources we deem reliable and is that on which our purchase of these bonds are based. Bonds of a particular m aturity may or may not still be available or may now be available at a price or yield different from that indicated above. Division of https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Hutton & Company Inc. 1.94X 2.04X https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Supplement to Northwestern Banker Newsletter 8-9-82 Actual Size: Flat 5 Vi x 7Vi, Folded 5 Vi x 3% Envelope 59/ie x 3% Full Color a ï » « ta* Greeting Cards Featuring Ybur Community r Please process the following order: □ 250 sets (10 cards and envelopes per set) $500.00 total. Attach 35 Millimeter Slide □ sets (10 cards and envelopes per set) 500 sets - $950.00, 1,000 sets - $1,800.00 here ! Wording for back side of card (limit to 25 words) Ship to: ATTN: _ Address C ity----- State □ check enclosed □ □ Please send sample card and envelope Zip send COD Northwestern Publishing Company https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 306 - 15th Street Des Moines, Iowa 50309 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 3 CALL ON THE “PERFORM ANCE TEAM ” where com m on transactions are handled uncomm only well. FIRST NATIONAL LINCOLN 13th & M Street • Lincoln, Nebraska 68501 • Member, F.D.I.C. ^ • W A V E R L Y : Jim Arens, senior vice president and cashier of The First National Bank of Waverly, has been named to succeed L.G. “ Jack” Hix as president. Mr. Hix has served as president since 1970. Mr. Arens started with the bank in 1958, be came cashier in 1964 and was pro moted to his most recent position in 1971. Nebraska News Two electronic banking terminals are in operation at the Nebraska State Fairgrounds through the rac• ing season, which concludes August 29, and the Nebraska State Fair, which will run from September 3-12. Placed there by National Bank of Commerce for the third straight ® year, the EFTs may be accessed by any of the 250,000 E FT cardholders in Nebraska who are attending the races or the fair. Gordon Shupe, in ^ charge of electronic banking at NBC, said the average cash with drawal in the previous two years at the races and the Fair was $32. In addition to offering E FT services to f all bank customers of NETS mem bers statewide, NBC will have a demonstrator available at each ter minal to explain how to use the machine, and hopefully generate ^ more interest in other Nebraskans becoming E FT card holders. ^ ^ G RAND ISLAN D : Dennis L. Barkely has been appointed vice president in loan administration of the Com mercial National Bank & Trust Company, according to E.J. Thayer, president. Mr. Barkely has been af filiated with the North Platte State Bank in its lending division for the past nine years. Minnesota News H O PKIN S: John D. McDonald has been elected vice president of credit adminstration at First Bank Hop kins. He has been with First Bank System since 1959, most recently as vice president in the commercial banking division at First Bank Min nehaha. joined the bank in 1980 with 20 years experience in banking and fi nance. Mr. Griffin will direct overall activities of corporate banking, con sumer banking, trust and financial institutions divisions. He started with the bank in 1981 after 14 years experience in banking and industry. North Dakota News Illinois News The North Dakota Bankers As sociation is co-sponsoring a series of eight late afternoon conferences for ag lenders from across North Dako ta in conjunction with the Extension Farm Management staff of the Co operative Extension Service at North Dakota State University. Each session will run from 3:008:00 p.m., with no registration fee, although individuals attending will be required to pay for their dinners. Questions about the sessions may be referred to Billy Rice, farm manage ment economist, NDSU, 701/237-7377. The schedule of dates follows: August 30, Ramada Inn, Williston; August 31, Holiday Inn, Dick inson; September 1, Town House, Bismarck; September 2, Holiday Inn, Fargo; September 7, Holiday Inn, Jamestown; September 8, Ramada Inn, Minot; September 9, A rt Clare Motel, Devils Lake, and September 10, Holiday Inn, Grand Forks. ELM HURST: Loren J. Clark and James W. Griffin have been pro moted to executive vice president, administration and financial ser vices, respectively. Mr. Clark will continue management of the asset/ liability division and will assume overall responsibility for controller and operations division as well. He FARGO: David Kjos has been ap pointed vice president of admini stration at First National Bank of Fargo, responsible for the opera tional and accounting areas of the bank. Prior to moving to Fargo, Mr. Kjos held the position of vice presi dent at the Northwestern State Bank of Dodge Center, Minnesota. M A N K A TO : A.C. Norland, chair man of Security State Bank of Man kato, has announced the election of Glenn M. Thompson as president, effective August 2. Mr. Thompson has been president and chief ex ecutive officer of the First State Bank of Waseca for the past six years. His banking career began in 1958 with the First National Bank of Minneapolis. W ASECA: First Bank Waseca re cently elected William G. Draeger president and managing officer, ef fective August 16. He succeeds Glenn M. Thompson who resigned to accept another position in Man kato. Mr. Draeger has been serving as president and managing officer of First Bank Lakefield since 1979, and began his banking career with First Bank System in 1950 at First Bank Austin. If you're asking a lot, (1 3 1 V | U The professionals at United Missouri Bank. j « Giving you what you need, w hen you need it. Dick Muir Larry Russell U N ITE D M ISSO URI BANK of Kansas C ity, n.a. Member FDIC __m w _____ ^ United w e grow.together. P.O. Box 226, 10th and G rand, Kansas City, M is s o u ri 64141 • (816) 556-7000 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Steve Panknin Jeff Goble Dave Dickens WANTADS Rates are $5.00 per line per insertion. Add $3.00 for file letters per insertion. Identity of file letter advertisers cannot be revealed. NORTHWESTERN BANKER 306 -1 5th Street Des Moines, Iowa 50309 Phone 515/244-8163 TIMETEMPERATURE • Steel Tubular Frame • Pole Optional • Remolt Control *2895 P.O. Box S63 Grand Island, Nebraska 68801 POSITIONS AVAILABLE (308)384-0111 All positions are in Missouri, Arkansas, Kansas or Oklahoma. Commercial Loan Officer, $70mm bank. $55,000 package. President, small rural bank. To $30,000 Correspondent, Commercial Lender. To $35,000 P O S IT IO N A V A I L A B L E Commercial Loan Officer, $30mm bank. To $35,000 Ag Lender, small bank. Open LEASING MANAGER—3 to 5 years in leasing business. President, $10mm bank. To $40,000 Degreed. Banking experience a plus. Send resume to: File President, $80mm bank. To $70,000 QBM, c/o Northwestern Banker. (PA) Controller, EVP, $70mm bank. To $50,000 Opening for OPERATIONS OFFICER with two-three years Ag Lender, $60mm bank. To $30,000 experience and desire to handle ag loans. Excellent oppor Commercial & Ag Lender, #2 Man, $50mm bank. To $35,000 tunity in $9 million expanding north central Iowa bank. Send resume and salary requirements to file QBO, c/o North President, CEO, $20mm bank. Open western Banker. (PA) Operations, some lending, $40mm bank. To $35,000 AGRICULTURAL LOAN OFFICER—2-3 years banking exCommercial Loan Officer, $25mm bank. To $35,000 perience. College grad. $60 million central Iowa bank. Eighteen years of banking serving as President of both Write file QBN, c/o Northwestern Banker. (PA) rural and metropolitan banks enables me to find the right Immediate opening In south central Nebraska. $25 million banking environment for you. I assure your confidentiality. bank. Applicant will manage installm ent loan department, Phone or send resume to: Don W. Schooler & Associates, and be responsible for compliance. W ill have opportunity 901 A. West Jackson, Ozark, Missouri 65721. Phone (417) to work into commercial and agricultural loans. Send 485-6020 (9am - 5pm). (417) 883-3713 (Evenings). salary history with resume. Write file QBQ, c/o North western Banker. (PA) DON" AND I "CHOOLER In 'ASSOCIATES "Successful Banking is Quality Personnel" BANKERS AVAILABLE Senior Ag Lender, age 35, ISU grad., currently number two man in $50 million community bank, seeks growth situa tion in progressive bank. File 202 Number Two Person, age 36, currently senior vice presi dent in charge of $28 m illio n lo a n portfolio in community bank. Ready to move up. File 303 Operations Person with real estate loan and student loan exp., former examiner. Age 28. Seeks new opportunity under $26,000 Ag Lender with ISU degree and PCA experience. Farm background. $16,000 Ag Lender with ISU degree and three years experience seeks job in central Iowa. Salary $25,000 CEO with outstanding track record in small community bank seeks new situation at under $35,000. Handles in vestments and ag loans. Installment Lender with solid bank experience, now employed, wants to join a progressive com munity bank. Salary range $24,000 Marketing Executive with extensive experience. Salary negotiable. Write or call Malcolm Freeland, Freeland Financial Services, Inc., 1032 Carriers Bldg., Des Moines, Iowa 50309. Phone 515/282-6462. Employer pays a reasonable fee. OPERATIONAL/PERSONNEL OFFICER—$45 m illion metro bank has opening for experienced operations and personnel officer. Challenging senior management posi tion with salary commensurate with experience. Write file QBP, c/o Northwestern Banker. (PA) SENIOR AUDITOR BANKING Excellent opportunity w ith a leading Iowa finan cial institution. Candidate must be degreed and have conditioned the public accounting examina tion. 2 years banking experience required. Growth opportunity in a professional and pleasant organ ization. Salary open. Good benefit package. For confidential consideration send qualifications in w riting w ith salary history to T.W. Textor. No fees. We are management retained. PERSONNEL INCORPORATED 2626 RUAN CENTER DES MOINES, IOWA 50309 FINANCIAL SPECIALIST IN THE TWIN CITIES AREA Call Brad Boe • 612/835-4466 7625 Metro Blvd., Suite 350 • Minneapolis, MN 55435 ^^M R EC R UII fcRS 300 Offices Nationwide The Search and Recruiting Specialists POSITIONS AVAILABLE AGRI LOAN—$25MM bank with m ajority of portfolio in agri credits. Prefer 5 yrs. or more bank experience and ag related degree. $25,000 COMMERCIAL LOAN—supervise lending function in $75MM bank. Opportunity to assume #2 spot. Knowledge of ag credits a plus. $38,000 POSITIONS AVAILABLE OPERATIONS—desire 5 yrs. experience in community bank of $30MM or more. Excellent opportunity for career advancement. Degree preferred. $26,000 CEO Positions for three upper midwest community banks ..................................................................................To $45,000 CASHIER—position is second officer in $25MM suburban bank. Any experience with lending helpful. $23,000 Commercial Lender for Colorado ski area bank Salary open. INSURANCE AGENT—well established agency with good earnings record. Manage insurance function and assist with some real estate credits. Nebraska licenses a plus. $ Open Instalment Lender w ith some commercial loan experience in com munity bank for bank in C o lo ra d o ................ $23,000 Leasing Manager to start and head up new leasing depart ment for major midwest b a n k ........................... Salary open. Ag Lender w ith two or more years experience w ith bank or Fed agency for southern Iowa b a n k ................... To $23,000 Ag Lender w ith two or more years experience for north west Iowa b a n k ......................................................To $24,000 REAL ESTATE LOAN—commercial real estate and con struction lending experience required for position in $100MM+ bank. $30,000 INSTALLMENT LOAN— handle installm ent loans and assist with agri credits for $40MM Rocky Mountain area bank. $20,000 Commercial Lender for major bank in northern Io w a ........ .............................................................................. Salary open. SENIOR COMMERCIAL LOAN—supervision of all lending activities in $80MM com munity bank. Prefer 7-10 yrs. ex perience in large bank. $40,000 CEO position for $200 m illion Upper Midwest b a n k .......... .............................................................................. Salary open. Additional positions available in midwestern states. All in quiries confidential. A resume' and salary history requested. Insurance Agent with bank experience for Nebraska bank. .............................................................................. Salary open. TOM HAGAN & ASSOCIATES of Kansas City Real Estate Lender for eastern Iowa bank .. .Salary open. Write or call Malcolm Freeland, Freeland Financial Ser vice, Inc., 1032 Carriers Bldg., Des Moines, Iowa 50309. Phone 515/282-6462. Employer pays a reasonable fee. 2024 Sw ift - Box 12346 North Kansas City, MO 64116 816/474-6874 “ Serving the Banking Industry Since 1970” Vol. 11 No. 16 Northwestern Banker Newsletter (USPS 873-300) is published weekly by the Northwestern Banker Company, 306 Fifteenth Street, Des Moines, Iowa 50309, (515) 244-8163. Subscriptions $1.00 per copy, $15.00 per year. Second class postage paid at Des Moines, Iowa. Address all mail subscriptions, changes of address (Form 3579), manuscripts, mail items to above address. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis
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