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Vol.9N o. 3 May 12,1980 Des Moines, Iowa Capital Vital to Economic Growth HERE has been an increasing T disregard for capital in the Unit ed States, along with the fading of accountability in relationships in volving govern ment and the pri vate sector, ac cording to Henry Kaufman, gener al partner and member of the executive com- HENRY KAUFMAN mittee of Salomon Brothers, New York, international investm ent banking and market making firm. Speaking before an Economic Club of Chicago dinner, Mr. Kauf man said, “We have, I believe, a last-ditch opportunity to stop the tide and to strike a new balance be tween social and economic object ives.” Mr. Kaufman presented four ex amples of the growing disregard for capital in the United States: * Credit market debt growth is outstripping the market value of outstanding equities. The ratio of debt to equities was 2-to-l from the early 1950s to the mid-1960s. But since then this ratio has worsened to 3-to-l in the past five years. In dol lar terms, at the end of 1979, credit market debt totalled $4.2 trillion and equities $1.2 trillion—a vast $3 trillion gap. By contrast, in 1964, debt totaled $1 trillion and equities $634 billion. There are three points pertinent to this disregard for cap ital, he said. First, inflation has been facili tated by an accommodative attitude regarding the issuance of debt. Second, inflation, contrary to conventional views, inflicts damag ing blows to equity values. Third, the liberalization of finan cial arrangements and alarming debt growth suggest that quite a few creditors, in the legal sense, are actually stockholders, in the operat ional sense. • The Federal Governm ent’s growing role as a demander of credit. The net credit demands of the U.S. Treasury and Federal credit agen cies in the 1950s and 1960s account ed for only 6% of all demands fi nanced in the credit markets in the United States. This climbed to 14% in the 1970-74 period and 23 % in the 1975-79 years. This development is detrimental to capital because these borrowings increasingly have fi nanced comsumption through trans fer payments to the private sector, thereby absorbing resources that could have added significantly to permanent capital. Outlays for hu man resources now account for 53 % of Federal budget outlays compared to 43% in 1971 and 22% in 1956. In addition, there is substitution of Government debt for private debt. These Government financings or guarantees foster a false economic validity to projects that would not otherwise be acceptable to private creditors or investors. * The disregard for capital in business finance. For the first half of the post-World War II period, busi ness corporations were reasonably consistent in financing their growth. For every dollar of new debt, they added a dollar of equity through re tained earnings and new share issu ance. But since the mid-1960s, debt growth has risen sharply and equity growth has lagged far behind. In 1979, after eliminating the inflation factor in inventories, debt increased more than three times as fast as equity capital. * Sharp shift in the pattern of household savings and borrowings. In the two decades up until the mid1970s, the annual net increases in household savings exceeded the net growth in household borrowings by two to one on average. But there was an extraordinary reversal in the past three years, with household borrowings now exceeding savings. Stating that the task ahead is formidable, the Salomon Brothers partner declared that an incomes democracy must be re-defined and the best of economic democracy must re-instituted—“before it is too late.” In order to return to the path of sustainable economic growth, Mr. Kaufman stated: Don't gam ble when choosing a correspondent bonk. Com e to the professionals. For any correspondent bonking need . . . overline assistance, d a ta processing services, investm ent counseling . . . just g ive us a call. W e're the professionals w h o put the response in correspondent bonking. “C ” C entral N ational Bank & Trust Com pany DES MOINES • MEMBER FDIC • TOLL FREE NUMBER (800) 362-1615 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis C io. l - . L .¿¿k Æjjjiitío iS A Æ u tiç s g itti* ' Eddie A. Wolf, Sr. Vice President Invest in Growth 1-800-362-1688, toll-free in Iowa Jack Conner Investment Banking Department new proposed changes in size stand ards for small business. The stand ard would determine a firm’s eligi bility for SBA loans, government contracting and other programs. The four-state regional public hearing will be from 9:30 a.m. to 4 p. m. in room 140 of the Federal Office Building, 601 E. 12th St., Kansas City. Small business owners in Iowa, Kansas, Missouri and Ne braska may attend and present oral and written testimony. Iowa News Bankers! "gT ros t l Des Moines, Iowa 50304 Member FDIC, Federal Reserve System 1. The growth of government in economic and financial life must be reduced. Otherwise, policies will persist that support consumption instead of capital formation that is the underpinning for job opportun ity and economic growth. 2. Taxation policies must be re structured to encourage capital formation. Disincentives for invest ment in equity capital should be re moved. 3. Policies should be instituted to reassert the fiduciary roles of financ ial institutions. One way to achieve this objective is to set clearer guide lines for the capital adequacy of fi nancial institutions. 4. The vitality of American enter prise can only be preserved if man agements are continuously chal lenged in their entrepreneurial effort. One way to accomplish this is to improve the linkage between management and stockholders. SBA Schedules Hearing The U.S. Small Business Admin istration will hold a one-day, fact finding public hearing on Thursday, May 22, in Kansas City, Mo., to re ceive comments and facts on the Iowa’s new usury bill, H.F. 2492, has been signed by Governor Robert D. Ray and is in the process of being published and certified. The bill re moves interest rate ceilings on all ag, business and real estate loans, as well as personal loans above $35,000. The consumer credit rate on closed-end credit was increased from 15% to 21%. It remains at 18% and 15% on open-end credit. The rate for new car and mobile home loans was raised to 21% ceiling. The bill contains a threeyear sunset provision. H.F. 2486, the Ag Credit Corp. bill, permits these organizations to charge 4% above the prevailing FICB rate. The definition of “agri culture” was placed back in the code and defines it as limited to ag pro duction. S.F. 2243 also passed in the hours immediately before adjournment on May 3 of the 1980 Iowa legislature. This is the Young Farmers Guaran teed Loan Program. The Iowa Housing Finance Authority may issue $150 million in bonds; loans will be made to qualifying farmers with net assets of under $100,000 who cannot get a conventional loan elsewhere; maximum loan limit is $500,000, with a lid for depreciable property at $125,000; 90% of the loan to be guaranteed by FhM A , and remaining 10% by the bank at prevailing rate, with loans handled by bank same as other FhMA guar anteed transactions. DAVENPORT: Joseph A. Grubisich Jr. has been promoted from assistant vice president and trust officer to vice president and senior trust officer at the First Trust & Savings Bank here. He joined the bank in 1978. DES MOINES: Central National Bank & Trust Co. has received con sent from the regional administrator of national banks to locate CBCT units at 1500 22nd St., West Des Moines; Sixth Avenue and Univer sity, and Merle Hay Road and Douglas. FORT DODGE: The First National Bank has filed for permission from the regional administrator of na tional banks to locate CBCT units at two Fort Dodge locations. KEYSTONE: Robert G. Roese, executive vice president of the Keystone Savings Bank, has been elected president to succeed Roland A. Hellwig, who is retiring after 35 years of service to the bank. Nebraska News Jerry E. Roe, president, Bank of Bennington, was elected president of the Nebraska Bankers Associ ation during the 83rd annual con vention in Omaha last week. Named president-elect was William W. Cook Jr., president, Beatrice Na tional Bank & Trust Co., Beatrice. The fathers of both men are pastpresidents of the Nebraska Bankers Association. The most important piece of busi ness at the NBA convention was an nouncement of a Structure Task Force by President Roe, composed of representatives from the largest C A LL ON TH E “PERFO RM AN CE TEAM ” where com m on transactions are handed uncom m only well. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis FIRST NATIONAL LINCOLN 13th & M Street • Lincoln, Nebraska 68501 • Member, F.D.I.C. Carleton D. Beh Co. Supplement to Northwestern Banker Newsletter 5-12-80 Investment Bankers/Financial Consultants NEW ISSUE SALE DATE: MAY 6, 1980 $3,000,000 MOODY’S: A1 HAZELWOOD SCHOOL DISTRICT, MISSOURI (ST. LOUIS COUNTY) General Obligation School Bonds Dated: June 1,1980 Denomination: $5,000 Both principal and semiannual interest (March 1 and September 1, first coupon due on September 1, 1980) payable at a bank to be designated. IN THE OPINION OF COUNSEL INTEREST ON THESE BONDS IS EXEMPT FROM ALL PRESENT FEDERAL INCOME TAXES. MATURITIES $ 50,000 50,000 50,000 50,000 50,000 75,000 75,000 100,000 225,000 7.25% March 1,1981 March 1,1982 March 1,1983 March 1,1984 March 1,1985 March 1,1986 March 1,1987 March 1,1988 5.90% March 1,1989 5.60 5.65 5.70 5.75 5.75 5.80 5.85 5.90 $250,000 375,000 450,000 400,000 400,000 400,000 6.00% March 1,1990 March 1,1991 March 1,1992 6.10% Marchi, 1993 March 1,1994 6.20% March 1,1995 6.00 6.00 6.05 6.10 6.15 6.20 5.95 LEGALITY TO BE APPROVED BY CHARLES AND TRAUERNICHT, ATTORNEYS, ST. LOUIS, MISSOURI The Hazelwood School District is one of the largest suburban districts in Missouri. The District occupies the northern tip of St. Louis County. It is bounded on the north and west by the Missouri River, and on the east by the Mississippi River. The southern District line is just south of Interstate Highway 270. Among the industries maintaining facilities in the District are: Ford Motor Co.; Kroger Co.; Hussmann Refrigeration; Schnucks Markets; Crown-ZellerbackCorp.; Wagner Electric Co.; General Foods Corp.; Sears Roebuck & Co.; General Motors Corp.; Rexham Corp.; International Paper Co.; Emerson Electric Co.; and Central Hardware Co. Two major railroads pass through the School District. These bonds are being issued under Missouri Statutes for various general purposes in the School District. In the opinion of counsel, these bonds are legal and binding general obligations of the Hazelwood School District, Missouri, and all taxable property located therein is subject to the levy of sufficient taxes to pay the principal of and interest on the bonds without lim it as to rate or amount. FINANCIAL STATEMENT Actual and Assessed value taxable property, 1979 Net direct debt, including this issue Total direct and overlapping debt $449,883,290 29,081,786 47,560,786 Population, 1980 estimate: 118,000 Net direct debt per capita: $246.46 Total debt per capita: 403.06 Area: 49,920 acres Net direct debt per acre: 582.57 Total debt per acre: 952.74 Tax collections have approximated 96.96% of taxes levied for the last six years. We own and offer subject to prior sale and change in price and subject to our attorney’s approving opinion: 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 was based. Offered subject to prior sale and change in price. Des M oine s B u ilding • Des M oines, Iowa 50309 • 515-288-2152 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 607 M a rq u e tte Ave. • M in ne a p o lis, M in ne so ta 55402 • 612-332-8825 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Supplement to Northwestern Banker Newsletter 5-12-80 M 9*. ¥ How w ill you approach NOW Accounts? Alex Sheshunoff, President of Sheshunoff & Co., Ine. With a positive approach... if you attend the Alex Sheshunoff Sem inar sponsored by National Bank of Commerce On June 18, National Bank o f Commerce will continue its series of Sheshunoff seminars when it brings Alex Sheshunoff to Lincoln. Sheshunoff will speak on “Profitably Meeting The Challenge Of NOW Accounts.” This seminar will show you how to price, introduce, and implement NOW Accounts, as well as how to compete more effectively for profits in this area. In addition, you will receive the 1980 High Performance Planning Report that is individually prepared for your bank by Alex Sheshunoff. NBC believes in taking an aggressive approach to correspondent banking. That’s why we continue to bring you information you can use, like the Sheshunoff seminars. If you would like to attend the June 18th seminar, please contact the Correspondent Division o f National Bank o f Commerce. NBC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis N a tio n a l B ank of Commerce The Bank w ith th e P lu s Member FDIC NBC Center, 13th & O St., Lincoln, Nebraska 68508 Telephone (402) 472-4321, WATS 800-742-7317 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 3 Call our Bond Department For up-to-the-minute, accurate information Tom Steffens Terry Mercurio Jim McLaughlin Vice President Vice President Asst.Vice President Asst.Vice President Vice President Bond Representative 234-2462 234-2458 234-2673 234-2463 234-2674 Tony Paugoulatos 234-2647 C ommerce banks in the state and a cross sect ion of community banks, whose assignment is to find a workable plan to reconcile structure differ ences that will result in a legislative plan endorsed by all banks to tàke to the next legislature. It was also revealed during the convention that NETS is in negoti ation with MI COR for a renewal of the switch contract that expires November 1, and also is negotiating with the Iowa Transfer System operated through the Iowa Bankers Association. The prospect of operat ing NETS with ITS apparently is very attractive to Nebraska mem bers, since bankers in the two states cooperated very closely with each other when the two systems were 10th and Walnut originated several years ago. A technical problem of incompatibility of systems within First National Lincoln and National Bank of Com merce with the ITS switch would have to worked out. U.S. National Bank of Omaha and Omaha Nation al Bank, the other two NETS pro cessing banks, are compatible with ITS. BEATRICE: W. W. Cook Sr., chairman of Beatrice National Bank & Trust Co., is recuperating well at Methodist Hospital in Rochester, Minn., after undergoing abdominal surgery to repair an aneurism. He is expected to return home sometime this week to Beatrice where he may be reached at Box 100 at the bank, ZIP 68310. Illinois News ASK T E R R Y M A R T IN to make MNB work for you. Toll free 1- 800 - 332-5991 RI Merchants A National Bank 151 Member F.D.I.C. Â BANKS OF IOWA’ BANK https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis John Henderson ORLAND PARK: A permit to organize has been issued to the Bank of Orland Park to be located at 7450 W. 159th St. here. The state bank’s total capitalization of $1,750,000 would consist of $700,000 capital stock, $700,000 surplus and $350,000 reserve for operating expense. Organizers in clude Jack D. Davis, Beecher; Mar lene Groszek and Robert M. Geary, Frankfort, and Philip J. Levoy and Michael Halikias, Orland Park. PEORIA HEIGHTS: William C. Robinson has been promoted from executive vice president to presi dent of The Heights Bank. John Pearl continues as chairman of the board. Mr. Robinson joined the bank in 1978. Minnesota News ELK RIVER: James M. Simpson has been elected president of The Bank of Elk River replacing Thomas K. Wilson, interim president. Mr. Simpson was most recently presi dent of the United National Bank of Watertown, S.D. Rusty Reese (816) 234-2000 GRANITE FALLS: Wayne Kaspari has rejoined the Yellow Medi cine County Bank here. He was formerly president of the Citizens State Bank in Barrett, and now as sumes duties as vice president in charge of commercial and agricul tural loans at Granite Falls. LAKEFIELD: The First National Bank of Lakefield has received consent from the Minnesota Com merce Commission to convert to a state chartered bank. The bank, which has held a national charter since 1899, will be named First Trust Bank of Lakefield. MINNEAPOLIS: Jim Philpott has been elected president and chief executive officer of the St. Anthony National Bank. He joined the bank in 1976 and most recently served as executive vice president and cashier. Colorado News Donald A. Childears has been ap pointed executive manager of the Colorado Bankers Association. Mr. Childears has been assistant man ager of the CBA for several years and had been acting executive manager since the resignation several months ago of Jerry Scarboro. Wyoming News CHEYENNE: Daniel B. Clawson has joined the First Wyoming Bank, N.A.- Cheyenne as executive vice president. Formerly he was □ I would like to sell my majority bank stock. □ I would like to buy ma jority bank stock. Please Contact: J. Mason Henry Charles E. Walters Co., Inc. P.O. Box 1313, Omaha, Nebraska68101 Phone: (402)553-6400 SERVING PROFESSIONALLY Banking, Financial & Business Personnel Iowa and Nationwide CAPITAL PERSONNEL SERVICE 714 Central National Bldg. 515-283-2545 Des Moines, Iowa 50309 senior vice president and loan officer at the First Wyoming Bank, N. A.-Rawlins. Montana News BELT: Richard A. Browning has been appointed vice president of the Belt Valley Bank. He was formerly associated wiht the First National Bank of Great Falls. BUTTE: John C. Koppelman has joined the First National Bank, Anaconda-Butte, as an instalment loan officer. He was formerly em ployed by the Fourth Northwestern National Bank of Minneapolis. Insurance for Financial Institutions Automated Systems of Iowa, Inc. 301 N. Ankeny Blvd., Suite 220 Ankeny, la 50021 515-964-1358 WANT ADS Rates 50 cents per word per insertion. Ad $2 for file numbers. Identity of file number advertisers cannot be revealed. Payment in advance, please. NORTHWESTERN BANKER 306-15th St., Des Moines, Iowa 50309 WANTTOBUY Interested in purchasing used safety deposit boxes. Write file KBG, cl o Northwestern Banker. (WTB) Addressograph equipment. Send information to Box 607, Boone, IA 50036._____________________ (WTB) FOR SALE Two (2) rotary power check files. One 660 White pur chased new; one Dlebold reconditioned in 1976. Have been using both to date. $500 each FOB, York, NE. Contact Dale L. Adams at (402)362-7411.________(FS) Burroughs TT-102 electronic on-line teller machines, 1-3 years old. $1850 each (original cost $3400). Call (214) 757-7760._____________________________ (FS) Burroughs TR-102 electronic teller machines. Upgrad able to on-line; 2-3 years old. Guaranteed. Freight paid. $995 each (original cost $2100). Call (214) 757-7760.________ (FS) NCR 152-70 teller machines. Completely recondition ed; 15 days free trial. Guaranteed. Freight paid. $775 each. Call (214) 757-7760.____________________ (FS) NCR 1550 electronic teller machines. Guaranteed. Freight paid. $895 each. Call (214)757-7760._____ (FS) BANKERS PARTICIPATING Estate Appraisals Three years installment experience ................$14,000 Purchase of Collections Sale of Rare Coins Reliable and respected service for over 20 years Used by bankers throughout the midwest Ben E. Marienee Coins 913 Locust Des Moines, Iowa 50309 515-243-8064 POSITION AVAILABLE Cashier, BA and one year experience............ 15,000 Consumer Banker with large bank ................ 14,000 Farm Manager for large bank wants ag lending ..................... 16,000 Loan Officer with good operations experience ..................................................... 12,000 AVP & Trust Officer, has insurance lic e n s e s ........................................................... 18,000 Ag Lender, five years experience ..................$16,000 Heavy mortgage experience, VA/FH A / CONV ............................................................. Trust Officer, small bank experience ............ 17,500 AVP & Branch Manager, a generalist ............ 20,000 23,000 Commercial credit and loan experience, large b a n k ............................................................17,500 VP with solid experience in all areas ............ 23,000 VP/Real Estate Analyst fo r mortgage company ......................................................... 25,000 President in $22MM bank, wants larger b a n k ................................................................... 30,000 President, stable background, varied experience ..................................................... 35,000 ALL FEES PAID BY MANAGEMENT INSURANCE AGENCY MANAGER— Person with in surance agency manager experience, or experienced and fully licensed agent, as manager fo r agency in west central Minnesota. Long established agency with potential for sound growth located in county seat town, good trade center. Good starting salary and fringe benefits with incentive program. Reply to file KBF, c /o Northwestern Banker.______________ (PA) Loan officer, with agricultural lending experience, needed in $65 million bank near Iowa City. Contact John Hughes, President, H ills Bank & Trust Co., Hills, IA 52235; (319)679-2291._____________________(PA) Commercial Lending Officer, with minimum of three years strong commercial experience, to head depart ment. Send resume to Dale Thompson, P.O. Box 727, St. Cloud, MN 56301._______________________ (PA) BANK CONTROLLER WANTED: Controller for $60 m illion central Iowa bank with one-bank holding com pany and other operating entities. Prefer CPA with one to five years experience. Salary open depending upon experience and qualifications. Send resume to K.M.M ., B ox65133, West Des Moines, IA50265. (PA) If you are seeking a qualified officer for your bank, call Malcolm Freeland, president, Freeland Financial Service, Inc. at (515) 244-8163. Experienced people are available from $20,000 to $40,000. Employer pays _________________________ (PA) service fee. Installment Loan Officer to head department. Strong managerial opportunity. Call Brenton Bank, Cedar Rapids, (319)364-9135.______________________(PA) Junior Officers, with one to three years banking exper ience, wanted by community banks in upper midwest. Employer pays fee. Send resume in confidence to Malcolm Freeland, Freeland Financial Service, 306 15th Street, Des Moines, IA 50309. Phone (515) 244-8163._________________________________ (PA) BANKING CAREERS— If you are currently employed and wish to evaluate your career potential, my organi zation has openings in the $12,000 to $40,000 range in banks throughout the midwest. All position job orders No. 101-175 are employers paid. Call or write Jim Hogan, Dunhill, Suite 1135, 730 2nd Ave. S., Minneapolis, MN 55402; (612) 335-6451 ■_____________ (PA) AG BANKING CAREERS AG LENDING OFFICER. . .SEM inn. . . . $16-18,000 AG LOAN REP. . .O h io ..............................$25-30,000 COMMERCIAL. . .Iowa ............................$20-25,000 LOAN OFFICER. . . Iowa ..........................$15-20,000 LOAN OFFICER. . . W. Iowa ....................$15-18,000 CREDIT SUPERVISOR. . . O h io ................$17-21,000 Since 1968, banks and other ag-related employers have been paying us to find the personnel they need. For more information, give Linda (our banking spec ialist) a call today. LeasePlanJnc. 545 - 31st Street PARTIAL LIST OF AVAILABLE APPLICANTS Des Moines. Iowa 50312 R. L. “DICK” SELLON • P.D. “DUANE” DEVAULT ________________________ ______ (515)394-3145______________________ New Hampton, IA 50659 FOR FURTHER INFORMATION RESPOND IN CONFIDENCE TO: POSITIONS AVAILABLE SENIOR OPERATIONS—$125MM bank in medium-size community; 5-10 years solid bank operations background necessary................................................$30,000 COMMERCIAL LOAN — Suburban $30MM bank. Desire commercial loan and real estate lending experience...................... $28,000 CONTROLLER— Position available in $25MM rural bank. W ill consider 1-2 years gen eral bank experience and accounting degree..................................................... $16,000 CASHIER— Small rural bank located near college community. Prefer farm back ground and insurance licenses............$18,000 CHIEF FINANCIAL OFFICER—$250 MM sav ings and loan association needs senior officer, ideal candidate w ill have degree in finance, 5-10 years experience and be an effective communicator.................... 45K OPERATIONS/LENDING— Suburban bank in good growth area seeks officer with 2-3 years general banking. Primary duties include cashier function with secondary responsibilityforconsum erloan. . . . $20,000 JUNIOR OFFICER— Excellent opportunity to advance to second position in this rural Iowa bank. Operations experience de sired...................................................... $16,000 Opportunities available throughout the midwest for experienced junior and senior officers. Resume and salary history requested. TOM HAGAN & ASSOCIATES OF KANSAS CITY P.O. Box 12346 / 2024 Swift North Kansas City, Missouri 64116 Phone (816) 474-6874_____________ _____ ______________ _____________ Vol. 9 No. 3 Northwestern Banker Newsletter [USPS 873-300] is published weekly by the Northwestern Banker Company, 306 Fifteenth Street, Des Moines, Iowa 50309. Subscriptions 25 cents per copy, $8.00 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 Vrf
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