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Vol. 13 No. 38 Des Moines, Iowa January 7,1985 9th Fed’s New Statistical Model Predicts— It expects the inflation rate to be between 3 and 3.5 percent in both years. The model indicates less un economic activity will decline during certainty about its inflation forecast one quarter over the next two years. than about real growth for 1985 and The model is relatively optimistic 1986. It estimates a l-in -2 chance about inflation over 1985 and 1986. that the inflation rate (measured by More Growth for Upper Midwest b o v e -a v e r a g e g ro w th A without an acceleration in infla tion is expected for the U.S. economy in 1985 and 1986, according to a new statistical model developed by Robert B. Litterman, senior econo mist at the Federal Reserve Bank of Minneapolis. Like all forecasts, though, this one is subject to much uncertainty. A special feature o f the new model, however, is its ability to quantify the uncertainty of its fore casts, he states. The model predicts that real growth—measured by the inflation adjusted gross national product (real GNP)—is likely to be near 3.7 percent in 1985 and 3.9 percent in 1986. These rates are slightly higher than the post-World War II average of 3.5 percent. The model expects the strongest growth in those parts of the econo my most likely to benefit from the recent decline in interest rates— such as the auto and housing indus tries and investment in plant and equipment. However, the model ex pects the trade deficit to continue to moderate growth somewhat. Despite the prediction of aboveaverage growth, the model indicates a high probability that actual growth in any given quarter could differ widely from its forecast. For example, the model estimates that there’s roughly a 3-in-4 chance that The New Model’s Forecasts for Growth, Inflation, and Unemployment* Growth (Real GNP) 0/ (Quarterly Percentage C hange at Annual Rate) ■"Most likely forecast surrounded by a range within which the variable is likely to fall 70 percent of the time, based on 1,000 simulations Sources: Forecast—Federal Reserve Bank of Minneapolis Basic Data—U.S. Departments of Commerce and Labor Call on the “Experienced Professionals” Ready to meet your correspondent needs. FIRST N A T IO N A L LIN C O LN 13th & M Streets, Lincoln, Nebraska 68501 A Firslier Company https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Member, F.D.I.C. 2 Professional ... Responsive... Call Mark Christen for any correspondent service. Call toll free (800) 622-7262 Valley National Bank ¡3 DES MOINES, IOWA 50304 A BANKS OF IOWA BANK Member FDIC the GNP deflator) will be between 2 4 percent in Montana, North Dako and 4 percent and only a l-in-16 ta, and South Dakota. chance that inflation will exceed 5 All economic forecasts are uncer percent in either of the next two tain, of course. Quantifying the un years. certainty as these new models can, Even though growth is expected however, is not possible with con to be above-average, the model pre ventional forecasting procedures, dicts only modest declines in the the Fed researchers say. civilian unemployment rate. The The forecasts of the new state rate is projected to decline only models depend on a forecast of con slightly from its October 1984 level tinued growth in the national econo of 7.4 percent to just above 7 per my which comes from a national cent throughout 1985 and 1986. The model also developed at the Fed. model’s uncertainty measure indi This U.S. model projects that non cates a 70 percent chance that the farm employment will grow between unemployment rate will be between 2.5 and 3 percent in 1985 and 1986. 6 and 8.5 percent over the next two The Minnesota model predicts years. that 1985-86 nonfarm growth in that The statistical approach of the state is most likely to match the Minneapolis Fed’s new model also growth predicted for the nation. allows it to predict the probability of Employment in Minnesota’s non future events. For instance, the farm industries is expected to in model predicts that the likelihood of crease at least 3.5 percent in both a recession in the next two years is years, somewhat more than employ about l-in-6 . ment nationally. Meanwhile, Minne The model’s forecasts, estimates sota’s nonfarm earned income and of uncertainty, and forecasting tech retail sales, adjusted for inflation, niques are described in several ar are projected to grow about 6 and 9 ticles in the Minneapolis Fed’s Quar percent, respectively, nearly the terly Review. same rates as their rapidly growing One of those companion articles national counterparts. describes how the Litterman model Wisconsin’s nonfarm growth is is used in conjunction with other 9th also expected to be close to the na Fed data to develop new statistical tion’s. The Wisconsin model pre models for the 9th District states of dicts that the state’s nonfarm em Minnesota, Wisconsin, South Dako ployment and earned income ad ta, North Dakota and Montana. The justed for inflation, will most likely five new statiscal models developed grow about 2.5 and 4.5 percent, re by researchers at the Minneapolis spectively, in both 1985 and 1986. Fed show that the nonfarm econo Growth in Wisconsin’s retail sales, mies of those five upper midwest adjusted for inflation, is projected to states are all likely to grow in 1985 accelerate between the two years, and 1986, but not all as fast as the from about 5.5 percent in 1985 to national economy. Again, these indi about 9 percent in 1986. M ost of vidual state models feature the abili these Wisconsin figures are not far ty to estimate how uncertain their below the corresponding figures in own forecasts are. the national forecast. The models say, for example, that The most likely growth forecasts in the next two years total employ for Montana, North Dakota, and ment in nonfarm industries has a 70 South Dakota are all somewhat alike percent chance of growing at an an and somewhat weaker than those for nual rate between about 1.5 and 4.5 Minnesota and Wisconsin. In both percent in Minnesota and Wisconsin 1985 and 1986, nonfarm employ and between about minus 1 and plus ment in these states is most likely to https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ABA Offers Bank Compliance Teleconference The American Bankers Associa tion, in cooperation with several state associations, will be offering the first of an annual series o f sym posiums on January 24 entitled, “ Bank Com pliance Sym posium 1985.” This video teleconference will provide compliance professionals with important information on re cent regulatory and legislative de velopments in the compliance arena. Panelists from banking, legal and regulatory professions will outline methods your bank can use to com ply with recent regulatory changes. Locations for the teleconference symposium are as follows: Iowa: Des Moines Area Community Col lege Conference Center, Ankeny. Minnesota: Radisson South, Bloomington. Illinois: Hyatt Lincolnwood, Chicago; Ramada Inn, Mount Vernon; Holiday Inn, Decatur. South Dakota: Holiday Inn City Centre, Sioux Falls. Colorado: Denver. For more information contact in dividual state banking associations. Iowa News Iowa Bankers Insurance and Ser vices will be conducting a Pension Compliance Seminar to be held Jan uary 16 at the Highlander Inn, Iowa City; January 30 at the Airport Hil ton Inn, Des Moines, and February 6 at the Carrollton Inn, Carroll. Fee for the seminar is $15. The agenda includes: Retirement Plans Today to begin the seminar at 10:30 a.m., followed by a noon lunch which is provided. A t 1:15 p.m. the semi nar resumes with IB A Revised Plan and at 3:00 will be questions and individual reviews. * * * 0 A Permanent Life Licensing School, which includes the general section, will be held January 28-29 at the office of Iowa Bankers Insur ance and Services at 104 East Lo cust Street in Des Moines. Insur ance licensing examinations can be taken on Wednesday, January 30. Registration will be accepted by mail only on a first-come, firstserved basis to room capacity, and must be received by January 21. f 9 • C E D A R R A P ID S : Richard E. “ Dick” Retz has been promoted to vice president in the correspondent banking division of Merchants National Bank. Mr. Retz joined Merchants in 1983 after ten years prior experience with Home State Bank at Jefferson. _ ^ DES MOINES: Charles H. Leibold has been promoted to vice president and trust officer in the trust division of Valley National Bank. Mr. Lei bold joined the bank in 1981 as trust officer. INDEPENDENCE: Dolph Leytze has been named executive vice presi dent of Farmers State Savings iBank. Currently vice president and a member of the board, Mr. Leytze also is vice president and a director of Fidelity Ban Corp, the bank’s holding company affiliate. Also an nounced at the bank was the ad vancement of Monte R. Cue, cashier, to vice president, and Malcolm G. Risk to vice president and cashier. Mr. Risk previously was a vice presi dent. Nebraska News I W ILBER: A t Saline State Bank in Wilber, David Stubbs has been pro moted from vice president to senior vice president, and A1 Skrabal has been advanced to vice president, ac cording to Harley Bergmeyer, presi dent. Mr. Stubbs has been with the bank four years and previously was a bank examiner. Mr. Skrabal will continue to serve as manager of Saline State Insurance Agency, Inc. Minnesota News LAKE CRYSTAL: Lake Crystal National Bank recently announced the election of Roger Schmeising as vice president and agricultural loan officer. Mr. Schmeising previously https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis was engaged in farming in the St. James area since 1959. Also an nounced were the following elec tions: Pat J. Crowley as assistant vice president; Mary Landkamer as cashier, and Gail Thompson as cus tomer service officer. Illinois News CHICAGO: Harris Bankcorp, Inc. and the First National Bank and Trust Company of Barrington have signed a letter o f intent under which Harris would acquire 100 percent of the Barrington bank’s stock for $32 million in cash. On September 30, 1984, First National Bank and Trust of Barrington had assets of $335 million and deposits of $304 million. The acquisition is subject to signing of a definitive agreement and regu latory approval. ROSCOE: Dale L. Blachford has been elected president and chief ex ecutive officer of First Bank of Roscoe, effective January 7. He began his banking career in 1976 at Belvidere National Bank and joined First Community National Bank of Rock ford in 1979. He was named vice president/cashier in January of 1984. Wisconsin News LA CROSSE: Robert W. Burg has joined Norwest Bank here as vice president of loan administration. He has served as legal counsel for the bank since 1978 and has been in pri vate practice with the law firm of Johns, Flaherty & Gillette, S.C. since 1976. SHAW ANO: John A. Hennessy has been elected president and chief ex ecutive, officer of Valley Bank here. He succeeds William Blythin, who has been elected chairman. Mr. Bly thin has served as president and CEO for nine years. Mr. Hennessy transferred to Valley Bank of Sha wano as executive vice president this past summer and previously was president of Valley Northern Bank, Appleton. ASK STAN FARMER to make MNB work for you. Toll free 1- 800 - 332-5991 Merchants A National Bank 1 5 1 Member F.D.I.C. A BANKS OF IOWA' BANK field joined First Bank System in 1973 at First Bank Huron. Most re cently he was elected president and chief operating officer of First Bank Aberdeen earlier this past year. Wyoming News JACKSON: A t First Wyoming Bank here, Ona Lee Kelley has been named senior vice president in charge of lending. A credit specialist with First Wyoming Bancorp since June, Ms. Kelley brings 18 years of bank ing experience to her new position. During her career she has served as president of banks in Chicago and Wisconsin. Montana News South Dakota News FORT BENTON: Harold A. Brown, senior vice president of First Bank Fort Benton, has been elected presi dent and managing officer of the bank. Mr. Brown has been with the bank since 1972. SIOUX FALLS: Gary L. Scofield has been elected president of the northeastern division of First Bank of South Dakota, according to David S. Birkeland, president and CEO. The northeastern division is comprised of First Banks in Aber deen, Redfield and Clark. Mr. Sco- SIDNEY: Diane G. Ford has been promoted to vice president and cash ier of Richland National Bank & Trust. She has been with the bank since 1973, when she joined the bank as a bookkeeper. She has also served as head bookkeeper, assistant cash ier and cashier. 4 Ag Banking Specialists Let us help with your career advancement or staffing needs. Call In confidence, without obligation. Employ ers pay our reasonable fee to hire the best. Financial Careers CEO for $25 million Iowa bank. Prefer experienced banker with college degree................................Salary $35,000 + CORRE&PONDENT OFFICER for major midwest bank. Prefer college grad, ag oriented, to travel Wisconsin or Illi nois ........................................................... Salary $35,000. COMMERCIAL LENDER for $600 million midwest bank. Must tie experienced in handling major credits and good at documentation..................................... Salary $40,000. NUMBER TWO person for $140 million bank. Must have loan experience in larger bank. Position leads to CEO . . . . ............................................................. .. 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Information on you will be kept confidential until you are inter ested in a specific position. Eighteen years of banking serving as President of rural and metropolitan banks enables me to match you, technically and personally, with the right bank ing environment. POSITIONS CURRENTLY AVAILABLE Missouri, Iowa Oklahoma, Kansas, Arkansas, Illinois, and Nebraska BRANCH MANAGER for bank located near major urban area. Requires 10 years experience. Prefer steady, wellrounded, ag-oriented banker with insurance licenses . . . . ................................................................... Salary $30,000. OPERATIONS OFFICER for community bank in western Il linois .......................................................... Salary $25,000. AG LENDER for community bank located in scenic area of eastern Iowa. Prefer college grad with ag experience . . . . ................................................................... Salary $30,000. AG LENDER for northern Iowa bank. Prefer college grad with one or two years experience. Must know documenta tion ........................................................Salary to $25,000. Write or call Malcolm Freeland or Cy Kirk in care of Freeland Financial Service, Inc., 1010 Equitable Bldg., Des Moines, Iowa 50309. Phone 515/282-6462. Employer pays reasonable fee. Many other opportunities now available. Immediate opening for COMMERCIAL LOAN OFFICER located in southeastern Minnesota. 1-3 years commercial experience. Please send resume and salary requirements to: President, Norwest Bank Faribault, N.A., P.O. Box 189, Faribault, Minnesota 55021. (PA) COMMERCIAL LOAN OFFICER—Seeking highly motiva ted, sales-oriented individual for excellent career oppor tunity with progressive bank. One to three years commer cial lending experience required. College degree prefer red. Excellent benefit package and good potential for ad vancement. Send resume and salary requirements to: Human Resources Officer, First Interstate Bank, P.O. Box 5010, Great Falls, MT 59403. (PA) cdfoCdex a n d cd ^ iio cia tz i Bank Consultants D onald PRESIDENT, $25mm bank, Agriculture oriented .. ...................................................$40,000 - $45,000 TRUST OFFICER for $70 million Iowa bank. Prefer lawyer with two or more years experience in handling trusts and esta tes.....................................................................Salary$30,000. AG LOAN OFFICER — Southeastern Minnesota. Immedi ate opening in $100 million bank to work with experienced ag lender in servicing large portfolio. Ag degree required. Salary open. Applicant should have 1 - 3 years ag lending experience. Send resume and salary requirements to: President, Norwest Bank Faribault, N.A., Faribault, Min nesota, 55021. (PA) COMMERCIAL LENDER, $60mm bank, 12,000 population................................. $35,000 - $40,000 #2 MAN, $35mm bank, small town $40,000 - $45,000 HEAD OF COMMERCIAL LENDING, $45mm bank Metro Suburb............................$40,000 - $45,000 HEAD OF OPERATIONS, $300mm Metro bank . . . ...................................................................OPEN AG LENDER with 5 or more years experience for southern Minnesota independent bank. Prefer college grad. Bank has no major loan problems.................................... Salary$35,000. AG LENDERS for PCA, to serve as managers in excellent farming areas. Offices do not have major problem loans. Prefer college grads with 3 or more years experience and farm background. Good documentation record is essential ............................................................... Salary to $30,000. P.O. 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Requires excellent docu mentation and analysis skills. $30K CEO - medium size Ag bank located in small northern Mis souri community. Previous administrative experience re quired. $40K Additional opportunities available in Midwestern States. TOM HAGAN & ASSOCIATES 2024 Swift - Box 12346 North Kansas City, MO 64116 816/474-6874 “ Serving the Banking Industry Since 1970” Vol. 13 No. 38 Northwestern Banker Newsletter (USPS 873-300) is published weekly by the Northwestern Banker Company, 306 Fif teenth Street, Des Moines, Iowa 50309, (515) 244-8163. Subscriptions $1.00 per copy, $18.00 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 # Supplement to Northwestern Banker Newsletter 1-7-85 _ There's no substitute for finely-tuned investments hen it comes to investm ents— long-term or short-term S lo th in g outperform s quality. And when it comes to quality, no one beats the outstanding track record of United M issouri’s Investm ent Banking Division. Sound bond portfolio recomm endations are our business. They have been since the 1920’s. You can rely on our ability to adapt in this changing financial world. Today and tomorrow, your bond portfolio w ill benefit from our consistently high standards. Call o r w rite United M issouri Bank today. W e’ve m astered the a rt o f quality. m Investment Banking Division UNITED MISSOURI BANK Member FDIC n.a. mm United we grow. Togethe ; IHi ... wÊÈÊÈÊÈÈÊÊmMm ■H Ag, ^ || Sas. ii.ïS ■ ■ ■ ■ |j ..... ......> ... J... ■ eï ■ ■ ■ iS ¡¡¡■i ■ WR https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis ... / . . . ' A HHM OnBM di ■HHHHHHHHHHHHHH ÄS la* H i IB m W B I • > ............ . m iIB S i m* la i es https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis
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