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P • Vol. 17 No. 12 Des Moines, lowa Two Fed Banks Exam ine New Powers ® ^ w m 0 0 0 0 • Ed. Note: The Federal Reserve Banks of Minneapolis and Chicago issued separate studies last week on the potential impact on banks of being granted new powers by Congress. Their reports follow—first, the 9th Fed report from Minnea polis, followed by the 7th Fed report from Chicago: ANK holding companies face an increased risk of failure if B they are allowed to merge with securities and real estate firms, according to two economists at the Federal Reserve Bank of Min neapolis. Merging with life in surance firms, however, would have the opposite effect: reducing the likelihood of bank holding company (BHC) failures. In an article just published in the Bank's Quarterly Review, John H. Boyd and Stanley L. Graham address two arguments made by BHC expansion proponents: that risk to BHCs would decline because expan sion would diversify assets; and that increased profits would offset the adverse effects of risk. Except for mergers with life insurance firms, the report negates both views. According to the report, “mergers between BHCs and securities firms are likely to increase profitability. However, they are not likely to result in the reduced risk of failure m ..unti \ \; / .--- —T"-"l j % / V m https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis that advocates of such mergers have predicted. If anything, such mergers are likely to increase BHC risk. That conclusion about risk is also true for BHC mergers with real estate development and property/casualty insurance firms.” The report also challenges the claim that banks need expanded powers to remain competitive. There is no evidence that BHCs have been consistently less profitable than other financial firms, except for sec urities firms, the study says. In view of their findings, the economists warn policymakers to consider their conclusions: The fin dings on relative risk effects are, in themselves, potentially of great im portance for public policy. Policy makers should be aware that the risk implications of BHC-securities firm mergers, for example, appear to be quite different than those of BHC-life insurance mergers. And they should be more concerned about the former than the latter. * * * ANK holding company expan sion into most nonbank activi B ties, if limited to a 10 percent in vestments, would not increase bank risk significantly, states an article published in the Federal Reserve Bank of Chicago’s July/August issue of Economic Perspectives. Follow the arrow to M uni . Aim for your Firslier Bank when you professionals will give you the direction you need to enhance your portfolio with any investment from Municipal Bonds to U.S. Government Securities. C a ll u s t o d a y ! July 4,1988 The study, authored by Chicago Fed economists Elijah Brewer III, Diana Fortier, and Christine Pavel, found that “a very small investment in a few nonbank activities—in surance agents and brokers and pro perty and casualty and life in su ra n c e u n d e r w r itin g —w ould reduce risk.” The authors also determined that some currently permissible activi ties are actually riskier than imper missible ones. “ If the riskiness of permissible activities reflects the risk tolerance of regulators, then it can be argued that BHCs should be allowed to engage in all impermissible ac tivities that are less risky than per missible ones,” the economists state. Nonetheless, permitting new activities requires careful considera tion, the researchers emphasize. While a ten percent investment in most activities would not signifi cantly increase risk, a ten percent in vestment in securities increases BHC risk significantly. However, “securities activities are not as highly correlated with banking as are several other less risky ac tivities,” the research team notes. The less correlation an activity has with banking, the better it serves diversification goals. Evidence cited in the study does indeed suggest that “BHCs with above-average investments in non bank activities will have belowaverage risk. Investment in nonL in c o ln In Nebraska: 800-742-7462 Om aha In Nebraska: 800-642-9305 Outside Nebraska: 800-228-9175 Your FirsTier Team. Here to serve you well. F irs T ie rB a n k s Firslier Bank, N .A ., Lincoln and Firslier Bank, N .A ., O m a h a , M em bers F D IC preciates and is encouraged by cards from friends. They may be sent to him at his home address—3908 72nd Street, Des Moines 50322. Al’s wife, Sue, shares these cards with him at the hospital. Norwest Bank Des Moines, N.A. Call (515) 245-3131 or toll-free (800) 362-2514 NORMEST BANKS Member FDIC Teamwork: one of the reasons we’re first in Iowa. M ark Conway Richard Pedersen 10, 1988, stated: “Whereas, the Board has considered the complete record of the cause and merits of the application of Commercial Federal Savings and Loan Association, Omaha, Nebraska, dated March 31, 1987 for permission to establish an interstate de novo branch on a nonsupervisory basis in the State of Iowa; and “Whereas, it is determined that there is no legal authority to esta blish the interstate branch; “ It is hereby resolved, that the said application is hereby denied.” First National Bank of Council Bluffs, directly across the Missouri Iowa News River from Omaha, and the Iowa In The Federal Home Loan Bank dependent Bankers, had protested Board, in its order #80-471 of June the application and were represen ted in the hearings by Howard O. Hagen, Des Moines attorney. bank activities reduces BHC risk overall,” the Fed researchers com ment. Because the Fed currently has the ability to initiate cease-and-desist orders as well as other penalties if it feels an organization is operating in an unsafe and unsound manner, the mechanism for control is already in place. “Further restrictions, such as limits on the relative size of nonbank investments, may also be needed before BHCs are allowed to engage in new activities,” the authors con clude. □ AMES: Banks of Iowa, Inc., com pleted the purchase on June 28 of United Bank and Trust, Ames, from the latter’s parent, Great Mid-West Financial Company. United Bank and Trust had assets of $135 million, loans of $68 million, dep osits of $118 million and capital of $14 million on March 31. The Ames bank also has two offices in Ames and one in Gilbert. Dick Retz MNB Correspondent Banker Together We Can Accomplish Great Things Call 319-368-4806 or toll free 1-800-332-5991 DES MOINES: A1 Tinder, who retired two years ago as president of Iowa Bankers Insurance & Services, Inc., is in critical condition in Mercy Hospital here. He especially ap DES MOINES: Banks of Iowa, Inc.’s board of directors elected Larry L. Gilb, 45, as president, effec tive July 1. He succeeds to the posi tion held since March, 1979, by Holmes Foster, 61, who will con tinue as chief executive officer as well as assuming the new title of chairman. Mr. Gilb joined First Bank System in 1971, became presi dent of First Bank Duluth in 1981, and most recently has been senior vice president of FBS holding com pany and managing director of the northern Minnesota region of eight banks. Mr. Foster informed the board a year ago he wishes to retire at the age of 62. DUBUQUE: Second Vice President Marian R. Gehrig has been appoin ted manager of American Trust & Savings Bank’s Town Clock Plaza office. She has held several positions since joining the bank in 1965. JoAnn M. Martin has been appoin ted manager of the bank’s Key West office. She joined the bank in 1980. I Strength of \ Eastern J |ow a_J Ben Eilders Member FDIC m # t's easier to talk Iowa banking w ith people w ho live it — people like Ben Eilders and the correspon dent staff at Bankers Trust. Des Moines, IA # Nebraska News LINCOLN: Among recent promo tions at National Bank of Commerce was the naming of two vice presi dents. Gothard “Ole” Friesen is head of the dealer services depart ment of the consumer banking divi sion. He joined NBC in 1975. Steven R. Knapp is in the corporate bank ing division and joined the bank in 1986. OMAHA: Among recent promo tions at Douglas County Bank & Trust Co. was the naming of David L. Henricksen to vice president and a member of the management com mittee, in addition to his duties as information officer. Call 1-800-362-1688 or 515/245-2424. Digitized for Merchants FRASER National Bank if) Cedar Rapids. Iowa 52401 Member F D I C A BANKS OF IOWA BANK https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis # Senior Vice President 999 ■Ä Iowa Natural Heritage 1989 Calendar FOR * f * W . rs< line your bank advertising every day of every month. \ tv » V The Iowa Natural Heritage Foundation is ftlCS Mo producing a calendar highlighting the natural beauty and heritage of Iowa. The 1989 calendar will feature new photography with different scene each month. When ^ e n the size will be \ \ \ 1 / \ 12" x 20" which includes a 2 x 12 area to imprint your individual bank mime \ "T \ <*■* \ along with up to three Additional lines of copy. The Iowa Natural Heritage calendar an effective method to adveftfti your bank’s A service or product tcryour customers, while helping support the work ofVhelowa Natural Hei^tage Foundation. I For more information on prices call (515) 270-0402 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis or write to INHF1989Calendar •P.O. Box 3538 •Des Moines, IA 50322 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Now Available P SS o'"*»" SSSs..." *■»“' Ä S«-». 1988 Bank Directories Accurate, up-to-date information on every bank in the state, concerning: • Officers and Directors • Deposits, Loans, Assets and other figures • Other offices away from main bank • Addresses and phone numbers • Departments within the bank and their officers • Correspondent banks used NEW 1988 ED ITIO NS Yes! Nebraska — Nearly 200 pages. Iowa — Over 300 pages. Send me. copies of the 1988 edition of the IOW A Bank Directory at $14.00 per copy. Send me__________ copies of the 1988 edition of the N EB R A S K A Bank Directory at $9.00 per copy. Our check is enclosed for $ ______________ (add state tax: Iowa @ 4% Nebr. @ 4%) Company Name C O N V E N IE N T T O U S E .Jie s flat for reading or copying (pages 3Va ” x 6 V2 ”). Officer Name _ P.O. Box or Street Address City and State Orders shipped by return mail https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis -Zip Phone _____ Area Code NORTHWESTERN BANKER 1535 Linden St., Suite 201 515-244-8163 Des Moines, Iowa 50309 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis OVER 60% p OFALL BANKSINOURMARKETAREAARENOWINSURED BY THE KANSAS BANKERS SURETY COMPANY That’s Right. . . In the nine states we serve we have solved the bonding needs for 6 of every 10 banks. That's over 16.4% of all banks in the United States • THE REASONS. . . # SUPERIOR SERVICE MOST COMPETITIVE PREMIUMS REALISTIC UNDERWRITING PROMPT CLAIMS SERVICE IF YOU’RE NOT GETTING THE SAME FROM YOUR BONDING COMPANY... GIVE US A CALL - YOU’LL BE GLAD YOU DID. THE KANSAS BANKERS SURETY COMPANY DO NALD M . TOW LE President DAVID E. ABENDROTH Senior Vice President 611 Kansas Avenue P.O. Box 1654 Topeka, Kansas 66601 Phone 1-913-234-2631 FINANCIAL INSTITUTION BONDS, SAFE DEPOSITORY LIABILITY, CHECKS KITING FRAUD INDEMNIFICATION, DIRECTORS AND OFFICERS LEGAL DEFENSE AND LIMITED INDEMNITY POLICIES https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Serving the Heartland of America since 1909 OVER 60% OFAU BANKSINOURMARKETAREAARENOWINSURED «I BYTHE KANSAS BANKERS SURETY COMPANY That’s Right. . . In the nine states we serve we have solved the bonding needs for 6 of every 10 banks. That's over 16.4% of all banks In the United States THE REASONS. . . SUPERIOR SERVICE MOST COMPETITIVE PREMIUMS REALISTIC UNDERWRITING PROMPT CLAIMS SERVICE IF YOU’RE NOT GETTING THE SAME FROM YOUR BONDING COMPANY... GIVE US A CALL - YOU’LL BE GLAD YOU DID. THE KANSAS BANKERS SURETY COMPANY DAVID E. ABENDROTH Senior Vice President DONALD M . TOW LE President 611 Kansas Avenue P.O. Box 1654 Topeka, Kansas 66601 Phone 1-913-234-2631 FINANCIAL INSTITUTION BONDS, SAFE DEPOSITORY LIABILITY, CHECKS KITING FRAUD INDEMNIFICATION, DIRECTORS AND OFFICERS LEGAL DEFENSE AND LIMITED INDEMNITY POLICIES https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Serving the Minnesota News The Minnesota Metro AIB has announced seminars to be held in Ju ly at its office in Minneapolis. Dates md topics are: 13th—Negotiation: jfkills, Strategy, and Styles; 14th— [anagem ent and Supervisory Skills; 20th—Real Estate Documen tation. For more information, con tact Judy Clark at (612) 338-8482. MINNEAPOLIS: William J. Gabler, former director of housing development and finance with the Minneapolis Housing and Redevel opment Authority, has been pro moted to senior vice president and manager of the public finance divi sion of Norwest Investment Ser vices, Inc. He was vice president in charge of housing finance in the div ision. Mr. Gabler served with the A uthority from 1976-1979. He previously was assistant executive director of the Greater Minneapolis Metropolitan Housing Corproation and was project manager for the New York State Urban Develop ment Corporation. MINNEAPOLIS: Two new vice presidents have joined National Ci ty Bank. Jack J. Richter serves in ■the corporate development departlent and was formerly associated nth First Bank Minneapolis as assistant vice president in their cor porate banking area. Jo Ann R. Hinnenthal serves in the capital mar kets division. She most recently was associated with Criterion Funds as regional vice president. M IN N E A P O L IS : R o b e rt A. Amundson has joined FBS Informa tion Services as vice president and manager, trust conversion. He has served in various capacities at Nor west Bank Minneapolis and Nor west Technical Services, most recently with the latter as senior !vice president, payment operations. MINNEAPOLIS: FBS Mortgage Corporation announced June 27 that DOES YOUR BANK NEED AN INVESTMENT CENTER? Your benefits: • New high net worth customers • Added profit • Reduced deposit loss to competitors • Ability to offer complete financial services For information contact: IN V E S TM E N T it has acquired Caylor Financial Ser approval and is expected to be com vices of Wisconsin, Inc., a privately pleted by the end of the third held mortgage broker in the Mil quarter of 1988. waukee suburb of Brookfield. The company’s 11 employees will be re Wisconsin News tained in the transition. FBS Mort gage will establish a Wisconsin of BROWN DEER: First Bank Brown fice at the Brookfield location and Deer, formerly Brown Deer Bank, business will be conducted in the has expanded its small business len name of FBS Mortgage. Diana Kos- ding department with the addition tal, who was vice president and part of several new officers. Among them ner of Caylor Financial, will serve as is Marianne Jaehnke, vice president in the commercial lending division. branch manager. She joined the bank last year as a MINNEAPOLIS: Norwest Corpora tion has received final regulatory ap proval to acquire the $20 million assets Ranch National Bank of Scottsdale, Ariz., effective July 1. Illinois News CHICAGO: Leslie K. Lorenz has joined The Exchange National Bank as vice president and product manager in the cash management division. She will be responsible for the strategic direction of cash management products. Most recent ly, she was with Wells Fargo Bank as assistant vice president in cash management sales, and before that with Continental Bank of Chicago in cash management sales. CHICAGO: On June 22, Unibancorp, Inc. announced th at its stock holders approved the merger of the company with Old Kent Financial Corporation, a multi-bank holding company in Grand Rapids, Mich. The merger is subject to regulatory At Security National Bank, our minds are on meeting all your Correspondent Banking and Investment needs. We’re Security for you! Ron Kiel Linda Gocken Correspondent Banking Officer SECURITY N A TIO N A L RANK IN SIOUX CITY, IOWA. MEMBER F.D.I.C. Come to the Investment Specialists committed to quality. In these times of change and uncertainty, rely on the time-tested quality invest ment recommendations of the Investment Banking Division of United Missouri Bank. A Meeting Of The M inis. 712-277-6736 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 1-800-544-7113 First Dakota Building P .O . Box 2796 Bismarck, N D 58502 or P .O . Box 65697 West Des Moines, IA 50265 Investment Representative 712-277-6745 U N ITE D M ISSOURI BA N K Member FDIC of Kansas City, n.a. 10th & Grand • P.O. Box 226 Kansas City, Missouri 64141 • (816) 556-7200 4 vice president in retail banking, hav ing previously served at First Inter state Bank in West Allis. JANESVILLE: Richard J. Schmit has joined Valley Trust Company as a vice president. He is responsible for managing the employee benefits plan activities in the Janesville market. He previously was vice president of employee benefit plan sales for Norwest Bank in Des Moines, la. The Bank of Westminster, with total assets of about $6.7 million, was closed on June 22 and reopened June 23 as a branch of the assuming bank. First National will assume about $6.0 million in deposits, will purchase substantially all of the failed bank’s assets, and will pay the FDIC a premium of $76,021. WANT ADS— Rates are $5.00 per line per insertion. Add $5.00 for file letters per insertion. Identity of file letter advertisers cannot be revealed. NORTHWESTERN BANKER, 1535 Linden Suite 201, Des Moines, Iowa 50309. Phone 515/244-8163 Wyoming News CASPER: On June 17, Wyoming National Bancorporation announced an agreement with Systematics, Inc. of Little Rock, Ark. to open a new data processing service center in Casper to service the needs of all the nine Wyoming National Banks across the state. The center will in itially employ at least 15 people. Montana News Lynn D. Grobel, president of the First National Bank of Glasgow, was advanced to the presidency of the Montana Bankers Association recently at its annual convention. He succeeds James D. Bennett, president, First Citizens Bank, Bill ings. Ed Jasmin, president, Norwest Bank, Helena, is vice president of the association, and Dave Calahan, president, First Interstate Bank, Missoula, is treasurer. A full report and photos of the convention will ap pear in the August issue of the N o r th w ester n B a n k er . Colorado News DENVER: The following vice presidents were among recent ap pointments at United Bank of Denver: Robert F. Bardwell, Jr., consumer banking; Donald K. Dodge, investment banking; Joseph M. Ferri, William J. Lunsford and William P. McOmie, loan ad ministration; Kent L. Ownbey, asset m anagem ent services; LeRoy Payne, Jr., commercial banking, and Connie R. Steams, funds manage ment. WESTMINSTER: The FDIC has approved the assumption of the deposits and fully secured liabilities of The Bank of Westminster by First National Bank, Westminster. Serving bankers quietly and efficiently. CAPITAL PERSONNEL SERVICE 815 Office Park Rd., Suite 6 W est Des Moines, Iowa 50265 515-226-0510 FOR SALE R EC O NDITIO NED BRANDT Coin Sorters-Counters BRANDT Currency Counters New Warranty 402 - 571-5577 FOR S A L E POSITION AVAILABLE $22mm N. IA bank needs EVP AND SR. LOAN OFFICER. 5-10 years ag loan experience essential. Responsibilities include administration, documentation, compliance, supervision of staff and call program in loan area. Also various bank committees. Salary commensurate to experi ence. Contact File No. W NS c/o Northwestern Banker. (PA) A strong North Central Iowa bank has an opening for the NUMBER TWO position. Applicant should have had previous operations and lending experience as well as be community oriented. Contact File No. W M T c/o North western Banker. (PA) HIRING! Government jobs— your area. $15,000-$68,000. Call (602) 838-8885. Ext. 9397._______________________ (PA) LOAN OFFICER— Strong in ag, FmHA, work outs, documentation, with growth potential to sr. loan officer in $19MM bank in Nebraska county seat town of 1,000. Con tact File No. WNR c/o Northwestern Banker. (PA) CANDIDATES AVAILABLE BRANCH MANAGER Thrives in environment that offers challenge & opportuni ty. Creative mgr. who gets most out of self & people. Has made all types of loans, particularly capable in ag & comm’l. Nowhere in lending this person wouldn’t be com fortable. $30K. CREDIT ANALYST Written and oral skills above the rest. Polished profes sional with two years of credit analysis and very strong analytical background. Well versed in computer spread sheet analysis and has worked with some very large comm’l packages. $26K. AG LENDER Is your staff not performing up to par? Three year results oriented ag lender who thinks first and acts second. Wide range of abilities include cash flow knowledge, Fm H A’s and loan workout skills. Meets people well and makes customers feel comfortable. $28K. FOR FURTHER INFORMATION CONTACT KUFTT ROSENCRANTB DATA PROCESSING SYSTEM. TX Instruments Business System 300 including 1 Tl Business System 372A with 256K processor, 38MB fixed disk, 14.5 MB Vi” tape backup & terminal console. Also, 1 MC306 6-channel controller, 3-WySE WY50 CRTs, 2-TI model 880 printers with paper trays. Contact Chuck Watson, Central States Resources Corp., P.O. Box 250sGretna, NE 68028. (800) 228-8025. (FS) COL. GORDON E. TAYLOR Box 949 - Mason City, la. 50401 515/423-5242 Professional Auctioneer Real Estate Broker and Appraiser POSITIONS AVAILABLE VP (SR.CLO)— Near term promotion to manage comm’l dept.! Initial resp. incl. mgmt. 5 + yrs. comm’l lending exp. A & mktg. abilities req’d. Attractively located near T.C.s in a mid-sized college commty. Exc. promotional possibilities within holding co. Tomid-$40’s. Job #NW 352^|^k LOAN OFFICER— Profitable north central Minn, bank B adding mgmt. member. Resp. for comm’l consumer, R/E ag lending. Mgmt. structure will allow for exc. growth potential. 3 + yrs. diverse lending exp. req’d. Some opera tions resp. Salary dependent on exp. Job#NW3522 0 AG LOAN— Profitable SE Minn, bank attractively located adding loan off. to staff. 2 + yrs. bank ag lending exp. w/ dairy emph. req’d. Must have some FmHA exposure. Bank growing, very few workouts. Tomid-$20’s. Job#NW3523 CALL PAUL GENTZKO W OR BILL BENSON ROBERT HRLF OF M M NESOTA.M C. 3636 IDS Center Minneapolis, MN 55402 (612) 339-9001 ALL FEES COMPANY PAID 317 6th Ave, Ste. 650 Des Moines, IA 50309 (515) 244-4414 ALL FE E S CO M PAN Y PAID CANDIDATE AVAILABLE LOAN OFFICER. Employed at small bank for past year & worked at same bank full-time every summer during col lege. Has worked in all depts., primary duties in lending. Handles majority of ag loans (including farm inspections, cash flows & spread sheets) as well as consumer & small commercial loans (inventory, floor plans, customer calls), also handles cashier duties. Has completed first year of ag credit school. Excellent references. Interested in ad vancement opportunity & open to any midwestern loca tion. BA business management. $20,000. Fees paid by employers. Banking Careers, Ltd. 525 Merle Hay Tower Des Moines, IA 50310 (515) 832-1258 _________________ POSITIONS AVAILABLE TRUST MARKETING • large urban bank. Requires degree and trust experience. $35K REAL ESTATE LOAN - single family residential and secon dary market experience required. Proximity of major metro area. $40K LOAN REVIEW • large bank experienced required. Both junior and senior level positions available. $28-$40K COMMERCIAL LENDING • V.P. positions in urban and large suburban banks. Personal portfolios from $20MM to $50MM. $40 K BRANCH MANAGER - handle small business and con sumer credits. Med-size community affiliate of multibank holding company. $24K Additional listings for commercial lending and trust officers. Resume’ requested. TOM HAGAN & ASSOCIATES P.O. Box 12346/2024 Swift North Kansas City, MO 64116 816/474-6874 "Serving the Banking Industry Since 1970" Vol. 17 No. 12 Northwestern Banker Newsletter (USPS 873-300) is published weekly by the Northwestern Banker Company, 1535 Linden Street, Suite 201, Des Moines, Iowa 50309, (515) 244-8163. Subscriptions $1.00 per copy, $24.00 per year. Second class postage paid at Des Moines, Iowa. Address all mail subscriptions, changes of address (Form 3579), manuscripts to Northwestern Banker, 1535 Linden St., #201, Des Moines, Iowa 50309. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis A ^ w
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