View original document

The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.



New Officers for Iowa Bankers Association
Special Ag Section:
• Des Moines to Host ABA Ag Bankers Conference
• 10 Features of Agriculture in the Year 2000
• C EO of Failed Bank Reflects on the Basics
• Historic Charts Portray Ag Economy
• Banking on Farmer Mac
Federal Reserve Bank of St. Louis


^ 1 |1
Merchants National Bank investment S ervices*

One of the leading Investment Departments in
Iowa, MNB offers the following investment opportunities:

SECURITIES: For customers or bank portfolios, MNB purchases
and sells U.S. Treasury and Agency securities ■ Commercial
paper ■ MNB jumbo certificates of deposit ■ Other money market
instruments ■ Municipal bonds

KEEPING: Including the acceptance and payment of a wide
range of securities. MNB’s Investment Department also coordinates the timely payment of interest and principal on securities
held in safekeeping.


MNB BOND ACCOUNTING: The Warrington Investment System
provides correspondent banks with the necessary portfolio
reports and accounting records.

PUBLIC FUNDS PLEDGING: MNB acts as an approved custo­
dian for the pledging required to secure public funds deposits.

F or the right investment opportunities, call on
one of our MNB Representatives today.

Donna Lewis

Jeanne Whitehill

Diane Lucore

Joyce Mitchell

3 1 9 /3 6 8 - 4 2 3 0

3 1 9 /3 6 8 - 4 7 1 7

3 1 9 /3 6 8 - 4 2 4 6

3 1 9 /3 6 8 - 4 3 7 9

Security Purchases/Sales
Municipal Securities

Public Funds Pledging

Security Purchases/Sales
Bond Accounting

Security Purchases/Sales
Jumbo Certificates of Deposit

Merchants National Bank is i

Cedar Rapids, Iowa 52401
Federal Reserve Bank of St. Louis

Member F.D.I.C


* P Y o g r a i»





C e n t»

SS®»«**"’ „«*»«*,««*
^‘% a”í»ñtf»s“!ÍSí“»5>


m-atttis just °S P° Vor tuore

l ÖVtogr
g -s S S * -

v®as& ""*■*
* ts £ ?

t s KAembef

Federal Reserve Bank of St. Louis

** t



S ^ ^ Ä S A S O

“Ninetypercent of our
Investment Center dollars
come from outside our
deposit base...”
“To be a leader in our industry and provide
new services to our customers — it was this
philosophy that prompted Bismarck State Bank to
establish the very first Investment Center in June

T°m Gunderson,Jr., andKevin Dunnigan with
a client. GundersonandDunniganare two ot
the six brokers at Bismarckstate Bank.

of 1985.
“ For years, we stood by as our depositors withdrew
money — only to invest with brokerage houses, insurance companjes and other financial entities

in search of higher interest rates. In
most cases, bankers were afraid
of innovative ideas for fear they

might jeopardize their deposit base. Yet, the introduction of
the Investment Center has, infact, enhanced our deposit
base. Our research has concluded that90% of our
Investment Center dollars comefrom outside our
deposit base and only 10%from bank deposits. In
addition, the Investment Center personnel cross-sell their
customers on bank products and services.
“The Investment Center concept has far exceeded
our expectations in three areas: (1) the percentage of
funds we generated from outside our own deposit
base; (2) the internal growth of the Investment
Center, including the number of brokers we would
need; and (3) the growth and earning level of the
bank itself — the bottom line!
“ We highly recommend the Investment Centers
of America.” —

Myron Pfeifle

For more information on how to establish an
Investment Center in your bank, call or write today!

Investment Centers of America, Inc.
First Dakota Building *212 North 4th St. • Bismarck, ND 58501

TOLL-FREE: 1-800-544-7113
North Dakota: 1-800-732-2363)
Digitized for(In
Federal Reserve Bank of St. Louis

Myron Pfeifle, President/CEO



OCTOBER 1988 • 95th year •


No. 1501



O fficers of the Iowa Bankers A ssociatio n fo r 1988-89 are pictured on the front
cover of th is issue. They are iden tified w ith the IBA convention report on page 51.



Northwestern Banker sale announced

Merger w ith Commercial West to form Northwestern Financial Review


ABA ag bankers conference

Des M oines w ill be host November 13-16


Charts portray ag economy

H isto rical records trace trends in past decades


Agriculture in the year 2000

New Regulatory Compliance
Manual Issued by IBAA
The Independent Bankers Asso­
ciation of America has introduced a
comprehensive new reference manual
for bank regulatory compliance pro­
The "IBAA Compliance Deskbook,”
designed especially for community
banks, covers all aspects of regulatory
compliance and is packaged in an
easy -to-read , easy-to-use form at.
Among the regulations covered are:
• The Expedited Funds Availabil­
ity Act and Regulation CC;
• Truth in Lending — Regulation Z;
• The Bank Secrecy Act;
• Insider Lending — Regulation O;
• The Electronic Funds Transfer
Act — Regulation E; and
• The Community Reinvestment
Act — Regulation BB.
Special Compliance Action Plans at
the end of key chapters help guide
bank officers through the regulatory
compliance process.
Low-cost updates to the "IB A A
Compliance Deskbook” will also be
provided as bank regulatory changes
The price of the "IBAA Compliance
Deskbook” is $95 for association mem­
bers. For nonmembers the price is
$195. Banks purchasing two or more
copies receive a 15 percent discount.
Copies can be ordered by writing
to IBAA, RO. Box 267, Sauk Centre,
MN 56378, or by calling 1-800-IBASAUK.

Dr. Neil Harl lists ten features to look for


Failed bank CEO reflects

First Wisconsin Expands
With Purchase in Arizona

Paul Quam revisits basic banking concepts


Leveraged buyouts

Dr. Doug A ustin and associates relate pointers


M innesota
Twin C ities
Illin o is
W isconsin
South Dakota


North Dakota
M ontana


Iowa C onvention
Des M oines
Index of Advertisers

1535 Linden Street, Suite 201, Des Moines, Iowa 50309

Phone (515) 244-8163

Publisher & Editor

Associate Publisher

Associate Editor

Ben Haller, Jr.

Robert Cronin

Diane Nelson

No. 1501 Northwestern Banker (USPS 397-620) is published monthly by the Northwestern
Banker Company, 1535 Linden Street, Suite 201, Des Moines, Iowa 50309. Subscription
$2.00 per copy. $24 per year. Second Class postage paid at Des Moines, Iowa. POST­
MASTER: Send all address changes to Northwestern Banker, 1535 Linden Street, Suite
201, Des Moines, Iowa 50309.
Federal Reserve Bank of St. Louis

First Wisconsin Corporation, Mil­
waukee, Wis., recently announced
plans to make its first bank acquisi­
tion in Arizona in a move aimed at
enhancing services to First Wisconsin
trust customers in the Southwest. It
will purchase Metro Bancorp, Incorpo­
rated, a $70.3 million one-bank hold­
ing company, which owns Metropoli­
tan Bank headquartered in Phoenix.
Terms of the transaction were not
First Wisconsin Corporation opened
its first out-of-state trust office in
Florida last year and the growth of
that office has exceeded projections.
The trust department of the newly
acquired bank will be supported by
accounting, investment, marketing
and a wide range of other services
provided by units of First Wisconsin
Northwestern Banker, October, 1988


BICS Installs Unique Computerized
Recovery System to Avert Disaster
ANKS of Iowa Computer Services
(BICS), Cedar Rapids, la., a re­
gional banking service bureau, has
installed a unique computerized disas­
ter recovery system that reduces the
amount of time customers in six states
are without data processing services
in the event of a disaster.
According to BICS President and
Chief Executive Officer Brian Scott,
"contingency planning has been a key
function in the banking industry for
many years, but as more and more
computers are used to speed banking
operations, the need for speed in the
disaster recovery process has also
BICS processes electronic banking
transactions for 14 Banks o f Iowa
banks and 50 other banks in Iowa and
five other states.
These transactions include deposits
and withdrawals made to and from
more than 200 automated teller ma­
chines (ATMs), and point-of-sale ter­
minals. Entries can include mortgage,
commercial and installment loan pay­
ments, and the savings, checking, and
general ledger transactions entered in
about 1,800 computer terminals.


Large Volumes Handled

In addition, BICS handles the dayto-day transactions o f its affiliate
banks and their correspondents for a
d a ily a v e r a g e v o lu m e o f a b ou t
1 ,000,000 transactions.

According to Mr. Scott, BICS busi­
ness volume equates to that of a bank
with assets of more than $6.0 billion,
serving more than 200 locations and
over 3,000,000 accounts.
All of this data — from the banks
themselves and from ATMs — is trans­
mitted to the BICS service center via
private leased telephone lines connect­
ing the various sites throughout the
Since there are many situations
similar to this, banking officials have
worked for years to devise systems to
eliminate the chaos that could occur if
a natural or man-made disaster ren­
dered a service center like BICS in­
operative. Repairs might take days or
even weeks, so Mr. Scott says the goal
of Banks of Iowa and BICS is to get
their system operational as soon as
possible — measured in hours and

Profit Planning
Asset/Liability Management
Consumer »Compliance
Regulatory Compliance
Organizational Review
Other Consulting Services
— Ronald L. George, President
* Call to register for ALM Seminar in October.

Af Midwest Management Consultants
9140 West Dodge Road, Suite 270

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Omaha, Nebraska 68114 (402) 391-1344


Comptroller Requires Plan

A recent directive from the federal
office of the Controller of Currency
makes it clear that banks must have
plans for handling disasters that go
beyond traditional m agnetic tape
backups of daily transactions, an
emergency source of electrical power
and an occasional simulated disaster
To comply with Federal regulations,
banks and bank service centers like
BICS now must be able to return vir­
tually every area of a bank that relies
on electronic data and information to
almost full operating capacity — and
do it quickly.
In spite of the regulations, Comput­
ers In Banking magazine surveyed
banks last year and found that 30
percent had no disaster recovery plan.
And, of those banks which did have a
plan, on ly 28 percen t said they
thought their plans would work.

Service Loss Intolerable

According to Mr. Scott, "the ex­
tended loss of banking services to
consumers served by any major finan­
cial institution using BICS services is
just not acceptable for obvious reasons.
Every care must be taken first to avoid
man-made disasters, and second to re­
cover quickly from natural disasters.
"Furthermore, the courts are now
holding banks and individual direc­
tors of banks liable for losses caused by
negligence — including failure to have

Superior Performance Banking
Through Professional Consulting

appropriate plans in place to handle
the losses incurred as a result of data
processing failure,” he added.

US W E ST Provides System

The BICS disaster recovery system
relies on a network configuration ser­
vice from US WEST Communications
(formerly Northwestern Bell) to make
it work. The service called "Command
A Link” provides the electronic where­
withal to quickly — if not instanta­
neously — reconfigure the complex
web of data transmission lines that
make up the BICS service network.
Lynn Gipple, US WEST Communi­
cations spokesperson, says that Com­
mand A Link is "similar to a comput­
erized railroad stationmaster who,
when a bridge is out or traffic backed
up, reroutes trains on an alternate
"In the case of BICS, data transmis­
sions from, say, Council Bluffs or Des
Moines are routed through Command
A Link at the US WEST Communica­
tions headquarters in Des Moines and
then routed to another Command A
Link center in the Cedar Rapids US
WEST Communications offices.
"A t the sam e tim e, data from
Davenport or Sioux City might be
coming directly to the Cedar Rapids
US WEST Communications office. All
of the data entering the Cedar Rapids
facility is then routed to the BICS
"But,” Mr. Gipple says, "if a problem
develops anywhere in the system,
Command A Link is able to analyze
available circuits and reroute the





transmissions so they reach the BICS
center with no break in service.”
Additional Backup














In the event of a major disaster
affecting the BICS services center,
Command A Link can be operated 'off
site’ by BICS personnel.
Depending on the magnitude of the
disaster, the BICS disaster recovery
system might also use the specialized
facilities and services of COMDISCO
Disaster Recovery Services, Inc. of
Rosemont, 111.
COMDISCO is the largest organiza­
tion in the United States dedicated to
providing emergency and contingency
data processing services to companies
such as BICS.
Equipment at COMDISCO’s Rose­
mont headquarters — or at any of
seven remote facilities — duplicates
the data processing setup at BICS. "All
we have to do,” Mr. Scott says, "is tell
Command A Link to send information
that normally comes to Cedar Rapids
to Chicago instead.
"It only takes a matter of minutes —
a few hours at the most — for the
entire BICS system to be up and run­
ning in Rosemont. Our customers
might not even know there was a
Only System in Iowa

The arrangement between BICS,
US W E ST C om m u n ica tio n s and
COMDISCO is the only such disaster
recovery program now operating in
Iowa. According to Mr. Scott, it’s also
unusual because the Command A
Link portion of the network is in daily
operation and is, itself, backed up by
having similar systems both in Cedar
Rapids and Des Moines.
Mr. Scott says, "Because the US
WEST Communications Command A
Link system is handling many routine
operations on a day-to-day basis, we
don’t have to worry that we’ve install­
ed a piece of equipment that sits idle
most of the time, works fine during
occasional tests, and then fails in a
crunch. We know, because we’re using
it every day, that it won’t fail when we
need it the most.”
The new disaster recovery system
was a significant expense for BICS,
"But,” Mr. Scott says, "these costs are
minimal when you consider the risk of
a major computer disaster — millions
of dollars in daily transactions carried
out by Banks of Iowa and other banks,
businesses and the millions of individ­
ual customers we serve.” □
Federal Reserve Bank of St. Louis

LaSalle National Bank supports you. With more than half a
century of e x p e r ie n c e ... innovative p ro d u c ts... responsive
service... and deep commitment to the market.
Our goal is to help you enhance your overall performance.
LaSalle takes a consulting approach to correspondent banking,
working closely with you to develop strategies that improve prof­
its, growth and efficiency We offer individualized service and
comprehensive capabilities, including:
• multiple investment consulting
• credit and financial services
• global trade finance
• merger and acquisition financing
• trust, treasury and many other services
In addition, LaSalle ensures dependable, cost effective safe­
keeping, investments, loan overlines and the other standards of
correspondent banking.
As your Midwestern neighbor, we share your perspective and
regional loyalties. As a Chicago bank with international resources,
LaSalle can share money-center banking opportunities as well.
Through our affiliation with ABN Bank, a leading global institu­
tion, we offer many advantages well worth investigating.
Get acquainted with LaSalle’s Correspondent Bankers. Call
Wayne Bismark or Del Rogers at (312) 443-2769. Wayne, Del and the
LaSalle Correspondent Banking team will give you unbeatable
support—with better service, better products and better ideas.
LaSalle National Bank
135 South LaSalle Street
Chicago, Illinois 60603
Member FDIC
Member of the ABN/LASALLE group

Your Correspondent Banking Bridge
c 1988 LaSalle National Bank

Northwestern Banker, October, 1988


RM A Offers New Training
utilize the entire M E N T O R program
to provide consistent training for all
of its commercial lending relation­
ship managers and credit support
people, regardless of their location
within the organization. A s in­
terstate banking becomes more of a
reality, this consistency will become
a more valuable asset to an
“ But M E N T O R can be just as ef­
fective when used in a more selective
manner,” he added. “ For example,
banking training officers can select
a single course—or several courses—
to fill specific bank training needs
from any or all of the three M E N ­
TOR tracks.”


FTER years of research and
p la n n in g , R o b e rt M o rris
Associates recently launched M E N ­
TOR, a new and unique training pro­
gram designed to meet the needs of
commercial lending professionals at
all levels.
R M A is the national association
of bank loan and credit officers.
According to 1987-88 National
R M A President William H. Sayre,
the M E N T O R program was devel­
oped in response to the everincreasing training needs of R M A ’s
3,100 member financial institutions
nationwide. “ The primary purpose
of R M A is service to commercial len­
ding and credit professionals. And a
major part of this commitment is
training—from entry level through
senior management,” Mr. Sayre
noted. He is executive vice presi­
dent, Fidelcor, Inc. and Fidelity
Bank, Philadelphia.
Mr. Sayre said the M E N T O R
training system was designed to
meet two key attributes of today’s
bank training environment. One, the
training needs of banks and thrifts
have become increasingly complex
and, two, the training marketplace
has grown more sophisticated. “ The
M E N T O R concept is revolutionary
in that it is extremely comprehen­
sive while being totally flexible,” he
explained. “ This is what our
members have told us they want and
“ For example,” Mr. Sayre con­
tinued, “ a banking organization can

Three M E N T O R “ Tracks”
R M A ’s M E N T O R program is
composed of three tracks: analytical,
lending and management. The ana­
lytical track focuses on basic com­
mercial banking skills: financial ac­
counting, financial analysis, loan
documentation and professional
The lending track covers ad­
vanced credit analysis, advanced
lending and corporate finance, and
sales techniques for commercial len­
The management track gets into
the areas of sales management,
decision-making, human resources,
current management issues, and
similar topics of interest to seniorlevel commercial lenders.
Clarence R. Reed, R M A ’s execu­
tive vice president, stressed that

It'S 10 P.M.
D o You Know W here
Your Collateral Is?
Why send someone from your audit­
ing department thousands of miles to
check on inventory used as loan collat­
Instead, call us. An SLT professional
is always nearby to provide full inven­
tory control services or spot checks.
Our nationwide staff can also keep
track o f insurance policies, lease con­
tracts and other documents in borrow­
ers' possession.
For over 50 years, SLT has helped
banks reduce credit risks on collateral
loans. To find out how our proven,
computerized system can help you,
mail coupon or call 1-800-325-7118.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Please rush information about SLT services for
financial institutions.


SLT Warehouse Company
I J ) ljl

1015 Loc u st St reet
St. Louis, Missouri 63101

freedom of choice and flexibility are
at the heart of R M A ’s M E N T O R
program. “ M E N T O R can be used to
supplement programs already being
run by a bank. Or it can be used as
the foundation for a bank’s entire
commercial training program,” he
said. Mr. Reed also noted that there
are no long-term commitments or
contracts associated with the M E N ­
TOR program.
Since no two banks have exactly
the same training requirements,
R M A is offering many of the M E N ­
TOR courses in three flexible for­
1. In-bank training, taught and
administered by R M A ;
2. Open-enrollment, sponsored na­
tionally by R M A and offered at the
local level by R M A ’s chapters and
groups, or subchapters.
3. Taught and administered
directly by a bank using materials
purchased from R M A .
Each course is developed by ex­
perienced education and training
consultants under R M A ’s direct
supervision. Before it can become
part of the M E N T O R program, each
course is again reviewed by active
banking p ractition ers, te ste d ,
evaluated, and revised to ensure
that it meets its objectives and
banks’ training needs.
The final result is a sequence of
courses that cover the essential
skills commercial loan and credit of­
ficers must have to make a positive
contribution to their bank’s bottom
A number of M E N T O R courses
are available now; most of them con­
tain pre- and post-tests. Others cur­
rently are being developed. Those
available now are
• Financial Accounting
• Business Writing for Bankers
• Using Credit Information in
Risk Assessment
• Commercial Loan Documenta­
tion (available 9/1/88)
• Uniform Credit Analysis
• Advanced Lending and Cor­
porate Finance (available 9/12/88)
• Sales Techniques for Commer­
cial Lenders
• Sales Management for Com­
mercial Lenders
For more information about
M E N TO R , and to learn more about
the courses currently available, con­
tact R M A ’s Account Manager, c/o
the R M A N ational O ffice in
Philadelphia, (215) 665-2810.




Across The Desk from the Publisher






Dear Readers:
W e announced in the September 26 issue of our
Weekly Newsletter that the “ Northwestern Banker Is
Being Sold,” an announcement that was made by me
with greatly mixed emotions. This October, 1988 issue
of the N orthwestern B anker will conclude my
43-year career with this publication, a span of more
than four decades in one industry, with one company.
These years have been a genuine blessing for me
because they have afforded me the opportunity to
work in the publishing field that I love, with all of you
for whom I have the greatest respect and admiration,
and the added opportunity for my wife, Peggy, and me
to develop the deep and life-long friendships we enjoy
with so many of you.
Now, it’s time for this 69-year-old publisher to leave
behind the grueling 64 deadlines a year that must be
met with our magazine and newsletter, and to look
ahead to more personal projects that have been my
goal for some years—three small books of a personal
nature that won’t mean anything to anyone else ex­
cept, hopefully, family members, and some important
church work to which I ’d like to give the more solid ef­
fort it deserves. A s all of you know from your demanding day-to-day work schedules, one cannot climb
these personal mountains without properly disposing
of the responsibilities that brought us to this point.









W ith that in mind, we have concluded arrangements
to sell the N orthwestern B anker to Paul Blackburn
of Minneapolis. Paul is president and owner of Finan­
cial Communications, Inc., which owns Commercial
West weekly publication, of which he is publisher. He
is also publisher of the Commercial West Bank Direc­
tory. This sale to Paul Blackburn also will include our
Weekly Newsletter and the Iowa and Nebraska Bank
Paul Blackburn is a native of Jefferson, la., where he
was born July 13, 1948. He was graduated from the
Drake University College of Journalism in Des Moines
in 1972, and then moved to Minneapolis/St. Paul where
he had a successful career in marketing with several
business firms. His most recent position before purchasing Commercial West in 1987 was a seven-year
stint as director of marketing services for Deluxe
Check Printers, Inc., at its national headquarters in St.
W e think this sale is a very positive step for it will
combine the 94-year-old strength of the N orthwes­
tern B anker in its ten-state area with the nearly 90
years of similar readership enjoyed by Commercial
West in its area, that in some states overlaps with
ours. In this day when so many challenging changes
are occurring within the financial industry, this com­
bination of two well-known banking publications in the
upper midwest will afford the opportunity to give our
readers broader, more in-depth coverage of the fastmoving financial news. A t the same time, the younger
staffs on both publications can combine to bring our
several thousands of readers the personalized news
Federal Reserve Bank of St. Louis

that has been our trademark for nearly a century.
Feature articles and surveys that address the oppor­
tunities, the problems and the personalities that Eire of
interest to you bankers on the daily firing line will con­
tinue to be a hallmark of the merged publications.
Paul Blackburn has announced that he will drop the
Commercial West name, since it represents the desire
of the early owners to serve the news interests of all
lines of commerce and industry in its territory. He will
retain the N orthwestern part of our name to identify
the broad territory he wishes to serve, and the
magazine’s full, new name will be N orthwestern
Financial Review . This will allow the magazine to en­
compass the broadening scope of the present financial

Ben Haller, Jr.

Paul Blackburn

This merger will give the continuing magazine one
of the best, if not the best, paid circulation figures in
the nation among the regional banking publications. In
addition to the states of Iowa, Nebraska, Minnesota,
South Dakota, North Dakota, Montana, Wyoming,
Colorado, Illnois and Wisconsin in which the two
magazines circulate, Paul Blackburn recently added
the state of Michigan. When he asked my advice
recently about his opportunity to acquire the circula­
tion of the Michigan Investor I urged him to do so.
W ith this basis of states, N orthwestern F inancial
Review will serve the interests of commercial bankers
in a significant number of states.
A s it was with several other individuals and com­
panies who expressed their desire to acquire the
Northwestern B anker , my concern other than the
usual personal financial interest was two-fold: First to
make sure that our long-time loyal readers would be
well-served by the decision made, and second, that
every effort would be made to accommodate our employ­
ees into the staff of the acquiring organization. I can
honestly say, after visiting with Paul over the past
several months and reviewing his well thought-out
game plan for the future, that the continuing interests
of our Northwestern Banker readers will be in good
hands. In addition, all of our staff will join with Paul’s
staff to assure this continuity of service to you. Our
Des Moines office will be retained where it is now
A C R O SS T H E D E SK . . .
(Turn to page 70, please)
Northwestern Banker, October, 1988


United Missouri Bank
Makes Officer Promotions
United Missouri Bank of Kansas
City, N .A . has announced the pro­
motions of Jack E. Beets and J.
Robert Hardin to the positions of
senior vice president in the cor­
respondent banking division.



Mr. Beets services the corres­
pondent banks in southeast Kansas.
He joined United Missouri in 1947
as a clerk in the transit department
and has held positions of assistant
cashier, assistant vice president and
vice president in correspondent
banking. Mr. Beets has attended the
Graduate School of Banking at the
University of Wisconsin.
Mr. Hardin is responsible for
bank customers in the metropolitan


Can’t Pla e
Insurant e?

Kansas City area and sections of
Kansas. He joined United Missouri
in 1981 as an assistant vice presi­
dent. He previously was associated
with other local financial institu­
tions. He holds a bachelor’s degree
in economics and finance from Avila
College. He also has attended the
Graduate School of Banking in
Madison, W is.
Also in the commercial banking
division, James B. McLaughlin was
elected to vice president and Todd
E. Gaffney to commercial banking
officer. Mr. McLaughlin develops
and maintains commercial accounts
through the Plaza location. Mr. Gaff­
ney serves commercial customers in
the metropolitan Kansas City area.
The following promotions have
taken place in the trust department
of U M B :
Donald P. Edinger, Allen Klopp
and Mark P. Herman to senior vice
M r. Edinger
manages the per­
sonal trust and
probate division,
a d m in is t e r in g
trusts and es­
tates. He joined
UM City Bank
moved to U M B
in 1983. PreviD.P. EDINGER

Insure Your Ikmm wers
at the B< rs t Price


Volume Policies

* A iií¡luities, Variables,
^ F n iv e r s a l Life
B IL L S H E R M A N , C L U

Call (800) 821-5434
in Missouri (800) 892-5890
IA C Group, bank insurance
specialists since 1952.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Other trust appointments in­
Richard A . Caspermeyer to vice
president, administering personal
trusts and probate estates.
J. Michael Gulley to vice presi­
dent, managing the investment data
Lou Ann Bradshaw to trust in­
vestment officer and Bruce Schmidt
and Edward W . Williams to assis­
tant trust investment officers.
Melanie Graham Aim to trust of­
ficer and Lorri B. Willms to assis­
tant trust officer.
Nancy T. Reynolds to trust opera­
tions officer and Janet F. Clements
to assistant trust officer in the
security transfer department.
United Missouri Bank also an­
nounced these promotions in the
Bankcard Division:
Thomas G. Dage to vice president
and assistant manager, commercial
development area.
Michael E. Henderson to assis­
tant vice president and credit
manager, and Claudia D. Farrell to
assistant vice president and assis­
tant operations division manager.
Laura L. Davis to assistant
cashier, supervising the customer
service department and managing
the central records department.
Kelli S. Kimbrough to bankcard
officer developing new MasterCard
and Visa business in the metro area,
and Matthew R. Vawter to bankcard
officer, soliciting and servicing com­
mercial businesses in the Midwest.

Rocky Mountain Bank Note
Names New Vice President

IAC Broköif-.i»[üi^ vice:
*H ig h -r^sk Insurance

and an LL.B. from Emory Universi­



ously, he was a trust examiner for
the State of Missouri. He holds a
B A degree in Journalism and an
L L .B . from the University of
Mr. Klopp manages the admini­
strative area of the employee benefit
plan services. He joined U M B in
1981 after 26 years in the U.S. A r­
my, retiring as a Lt. Col. in 1975. He
holds a B A degree in Business A d ­
m in istra tio n from N o rth w e st
Missouri State University.
Mr. Herman manages the legal
staff of employee benefit plan ser­
vices. He has been with United
Missouri since 1984. He has a B A
degree from Vanderbilt University

Larry A. Dietz
has been p r o ­
moted to the post
of vice president
— general man­
ager of the Com­
p u t e r P r in t e d
P ro d u cts D iv i­
s io n o f R o c k y
M ountain Bank
N ote, D en ver,
C olo. The u n it
prints installment loan coupon books,
real estate mortgage books and credit
line check books for financial institu­
tions. In addition, Mr. Dietz serves as
general manager of the company’s
Pueblo operations, which consists of
commercial printing and office prod­
ucts sales.



10th Edition of Dr. Harl’s
Planning Book Is Published
The 10th edition of Dr. Neil E. Harl’s
"Farm Estate & Business Planning,” a
valuable reference manual to farmers,
a ccou n ta n ts, la w yers, in su ra n ce
agents and lenders, will be available
Oct. 15.
More than 150,000 copies of this
reference classic have been sold since
the first printing in 1973. This edition
features the latest changes in both
federal and state laws and regulations
affecting farms and farm estates.
Dr. Harl, a professor at Iowa State
University, Ames, is nationally recog­
nized for his expertise in economics
and agricultural law. He is the author
of more than 240 articles in legal and
economic journals and more than 525
articles in various farm and financial
publications. His advice is widely
sought in government, legal and eco­
nomic circles.
"The business of farming demands
business planning,” Harl says. "Estate
planning is needed to avoid fragmen­
tation and loss of capital.”
Some of the new topics Dr. Harl
covers in this 10th edition are compli­
ance on government payment limita­
tions, the tough corporate liquidation
rules, revised rules governing em­
ployee benefit plans, handling Conser­
vation Reserve Program payments,
cancellation and forgiveness of install­
ment payments, estate freezes and the
impacts of bankruptcy.
The 400-page book, published in soft
cover, may be ordered by sending
$24.95 to: Century Communications
Inc., 6201 Howard St., Niles, 111.

BMA Schedules National
Meeting in San Francisco
Bank Marketing Association will
hold its 1988 National Marketing
Conference entitled "Gateway to the
90’s: Your Bridge to the New World
of Financial Marketing,” Oct. 30 - Nov.
2 at the Hilton Square Hotel, San
BMA expects more than 2,000 fi­
nancial executives from across the
country and around the globe to attend
the world’s most prestigious financial
services marketing conference, now in
its 73rd year.
Attendees will hear what it truly
means to cope with difficulty and sur­
vive hardship when Charlie Plumb,
an ex-POW of the Vietnam War, kicks
off the conference. A native of Kansas
Federal Reserve Bank of St. Louis

City, Mr. Plumb is a former Navy
fighter pilot whose jet was shot down
while flying a cover mission over
North Vietnam in 1967. After his cap­
ture he spent six years locked in an
eigh t-by-eigh t foot prison cell in
Mr. Plumb distinguished him self
am ong fellow prisoners and was
awarded the Purple Heart and the
Silver Star. He is also the author of two
books, I ’m N o Hero and The Last
F o llow in g Mr. Plum b, keynote
speaker Martin L. Cohen, consultant,
lecturer, psychiatrist, and chairman/

CEO of Cohen Brown Management
Group, Los Angeles, will deliver a
motivating presentation on meeting
the challenges of the future.
BMA has tapped experts from with­
in and outside bank marketing to
speak at this year’s conference.
Presentations and panel discussions
will address a wide-ranging list of
topics facing financial marketers.
And, for its 21st year, BMA will
recognize financial institutions world­
wide for the most outstanding achieve­
ments in marketing and corporate
communications in its "Golden Coin
Awards” competition.

As part of the BICS 10-Point Service and Support System,
you get your very own executive account manager. One of these is
Anna Lee Scott. Her job is to make sure BICS gives your bank
state-of-the-art data processing...and more.
One way is with our management consulting service (point #6).
We put our minds to work for you so you can serve customers
better, operate more efficiently and keep ahead of your
To find out how the BICS 10-Point Service and Support
System can give you 100% support, 100% of the time, call
1-800-421-0059 or 1-800-332-5242 (in Iowa).

1 0 0 % SUPPORT.
1 0 0 % OF THE TIME.


a n

k in


4333 Edgewood Rd. N.E.
P.O. Box 1847
Cedar Rapids, Iowa 52406
A Banks o f Iowa subsidiary

Northwestern Banker, October, 1988


IBAA Asks Immediate Growth
Limit on Insolvent Thrifts
The Independent Bankers Associa­
tion of America has requested that the
Federal Home Loan Bank Board en­
force a growth limit for insolvent and
undercapitalized savings and loans
and to impose a cap on the interest
rates they pay on deposits.
Such a move by the Bank Board, the
regulator of the nation’s thrift indus­
try, "is urgently needed if the integrity
of our financial system is to be main­
tained,” IBAA President J.R. Nunn
said in a letter to Bank Board Chair­
man Danny Wall.
Mr. Nunn applauded the efforts of
Senate Banking Committee Chair­
man William Proxmire, D-Wis., and
Rep. Jim Leach, R-Iowa, to address the
problem of runaway insolvent thrifts
in Congress. Congressman Leach gave
details of his plan to impose such curbs
on failing thrifts when he addressed
the Iowa Independent Bankers at
their annual convention in July at
Lake Okoboji, la. It would require
thrifts with negative figures to reduce
their deposits on a formula basis tied
to the extent of their statement fig­
ures, and would then allow modest to

normal growth as thrifts regained
strength into positive figures up to 6%
equivalent capital.

Farmers Mutual Hail
Announces Promotions
William A. (Bill) Rutledge, secre­
tary of Farmers Mutual Hail Insur­
ance Company of Iowa, Des Moines,
has been elected senior vice president
and manager of the reinsurance de­
partment. He will continue his duties
as secretary of the firm.
Steven A. Rutledge, member of the
board of directors of Farmers Mutual
Hail, has been elected assistant vice
president and assistant manager of
the reinsurance department.
Founded in 1893, Farmers Mutual
Hail Insurance Company of Iowa pro-



Don't kno w w ho to ca ll for those
sp ecial m oving n e e d s?
CTS has been successfully serving the computer dealer/lessor & banking
industries since 1979. We provide a complete, worry-free, moving service
for ATMs & all D.P. equipment local or nationwide.
Our specialized moving services & discount program can save you valuable
time & money.

Padded air ride, van service (requires no special pre-packaging)
Air freight for smaller or time sensitive items
Nationwide packing
Storage arrangements

Call one of our courteous coordinators for a prompt quote and let CTS
handle it.

— 1-800-831-0030
- 712-673-2354
- 712-673-2683


107 M a in • P .O . B o x 2 9 8 • B re d a , IA 5 1 4 3 6

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

vides crop hail coverage in 13 midwestern states, poultry insurance in
32 states, and reinsurance interna­


Bank Building Corp. Names
New President and Chairman


The hoard of di­
rectors of Bank
Building Corporation has elected
a new president,
Roger M. Scott,
and a new chair­
man of the board,
Carl J. Weis.
Mr. Scott suc­
ceeds Mr. Weis
as president. Mr.
Weis, who has held the position of
president since 1976, and chief execu­
tive officer since 1983, will continue to
serve as chief executive officer.
Mr. Scott most recently was general
manager of the Reynolds Metal Company’s Building Products Group in
Richmond, Va. During 31 years with
Reynolds, his responsibilities included
sales, marketing, corporate planning
and management.
Bank Building Corporation is a St.
Louis-based design/ firm, specializing
in the Unified Facilities Development
process for financial institutions.
The firm is currently celebrating
75 years of service to the financial

Northern Trust Names New
Senior Vice President
At its meeting
last month, the
board of directors
of The Northern
Trust Company,
C h ic a g o ,
proved the nam­
ing of Richard B.
S t e b b in s as a
senior vice presi­
dent in corporate
finance. Mr. Steb­
bins is responsible for coordinating
Northern Trust’s efforts in developing
corporate finance, and expanding
mergers and acquisitions and private
placement activities in commercial
Prior to joining Northern Trust, Mr.
Stebbins was associated with First
National Bank of Chicago, Kidder
Peabody and m ost recently, with
Merrill Lynch Capital Markets where
he was managing director of its Midwest Financial Institutions Group.














o company, anywhere in the
United States, can do as much to
make your credit insurance
operations more profitable
and problem free
than North Central Life.
"America’s Number One Credit Insurance Service Organization”

North Central Life Insurance Company

In Minnesota call 800-792-1030.
All other states 800-328-9117.
Protection all ways
Federal Reserve Bank of St. Louis

Lindberghmade the
first solo non-stop
flight acrosstheAtlantic Ocean,
Oscarwas If born andUnited
Bank opened its
United Missouri announced Correspondent Banking
Services in ’27. It didn’t make national headlines. It did make
a difference.
Since then, United Missouri has helped hundreds of
banks improve their funds collection.
The bank has done it by building a large direct send net­
work. And, by offering all correspondent banking services
which only an experienced bank could offer.
As a result, United Missouri customers have collected
their funds faster and invested them faster.
dbday, United Missouri’s Correspondent Banking Divi­
sion still makes a difference. It can make a difference for you.
Call United Missouri Bank for your bank’s funds collection.
And, pick the proven performer.


of Kansas City, n.a.
P.O. Box 419226, Kansas City, Missouri 64141-6226
Federal Reserve Bank of St. Louis


Des Moines will host
ABA Ag Bankers Conference
at the

des M oiNEs^\arrioti
November 13-16
ES MOINES will be host to the 1988 American
Bankers Association National Agricultural Bankers
Conference, November 13-16, at the Marriott Hotel in
downtown Des Moines. Between 750 and 1,000 bankers
0 and spouses are expected to register for this important
Planning Committee Chairman Murray Lull, who is
also president of the Smith County State Bank and Trust
Company in Smith Center, Kan., stressed the central
HI location of Des Moines in the heart of the midwestern
farm states and its accessibility by auto travel from the
entire upper and lower midwest area of the nation. This
accessibility by the Interstate system and other major
highways should encourage banks to capitalize on such
# low-cost transportation by registering two or three offi­
cers from each bank.
"This conference will help agricultural bankers devise
the strategies they will need to meet any challenge in
today’s complex new era of ag banking,” Mr. Lull said. He
# added, "It will give bankers valuable insight since experts
bring the state of the industry to the conference.”
Sessions will include the latest information on legisla­
tive, regulatory and USDA programs affecting crops for
1988 and 1989. In addition, ag bankers will learn the
• latest techniques for handling farm loans which may have
to be rescheduled because of the dry weather.
The Iowa Bankers Association, through Executive Vice
President Neil Milner and Senior Vice President Wes
Ehrecke, have worked closely with ABA in scheduling the
• National Ag Bankers Conference into Des Moines. Mr.
Ehrecke said there are a number of interesting points and
dining/entertainment places in Des Moines for visitors
(see accompanying story).
With the theme, "Your Untapped Potential,” this year’s
® conference will help agricultural bankers cultivate new
business opportunities. For instance, sessions will include
the latest information on the new Farmer Mac, the
secondary market for agricultural mortgages and rural
housing. Experts in secondary market finance will focus
® on how banks can benefit by participating as an ori­
ginator, a pooler, or a purchaser of secondary market
Other profit opportunity sessions will include:



« F e e Income: a positive approach to fee collection and
the possibilities offered to banks under new laws;
• Farm Land Management: operational aspects of
farmland management and how banks can market
these services.


• Leasing: the operational aspects of leasing, staffing,
marketing and decision making;
Federal Reserve Bank of St. Louis

• Agri-business Lending: financing non-production ag­
ricultural business, the "typical” business operating
and capital cycle, and pro forma information;
• Beating the Competition: the vital role customer
service plays in a competitive market and how ser­
vice quality must be nurtured if banks are to survive;
• Madison Avenue Moves to the Country: How one of
the most successful marketing programs came about
and how the producer groups were convinced to
use it.
"In order to fully develop their untapped potential,
bankers must weed out the competition, improve their
customer base, refine their profit outlook and focus on
expanded powers from Congress to offer new products and
services,” Mr. Lull said. "At this conference,” he added,
"bankers will gain the techniques and strategies they
need to do just that.”
Veteran farm broadcaster Orion Samuelson will offer
his perspective on agriculture today, touching on subjects
ranging from weather-affected crops to exportation of
surplus crops. Mr. Samuelson is host of the "U.S. Farm
Report,” which is broadcast from WON Radio, Chicago.
The registration fee is $655 which is discounted to $525
for ABA members. For more information, contact ABA’s
Banker Education Network at 202/663-5430 or write the
Registration Coordinator, American Bankers Associa­
tion, 1120 Connecticut Avenue, N.W., Washington, D.C.
20036. The program follows:
Sunday, Novem ber 13
A .M .

9:00 to
7:30 p.m.
10:00Musical Fellowship


6:00 to
Opening Reception
After the reception, enjoy a relaxing dinner at an area
restaurant, or watch big-screen NFL football — Minne­
sota Vikings vs. Dallas Cowboys — at the Marriott
Monday, N ovem ber 14
A .M .

7:00 to
5:00 p.m.
Continental Breakfast
Opening General Session
Welcome and Opening Remarks — Murray
Northwestern Banker, October, 1988





Lull, 1988 Conference Chair and President,
Smith County State Bank and Trust Com­
pany, Smith Center, Kans.
Welcome to Iowa— Honorable Terry E. Branstad, Governor (invited).
"National Perspective on Agriculture — The
People’s Viewpoint” — Orion Samuelson, Vice
President, Agricultural Services Director,
WGN Radio, Chicago, 111.
"D om estic A g ricu ltu ra l P olicy — W hat
Should the Next Four Years Bring?” — Peter
C. Myers, Deputy Secretary, of Agriculture,
USDA (invited), Washington, D.C.
Coffee Break
General session continues.
"View From the Hill — The House Agricul­
ture Committee Perspective” — A member of
the House Ag Committee will bring you up to
date on proposed changes in agricultural leg­
islation and credit.
Concurrent Sessions
"Fee Income — Income for the Future” —
W illiam F. Staats, Professor o f Banking,
Louisiana State University, Baton Rouge, La.
"Farm Land Management — Earn Extra Dol­
lars With Your Agricultural Expertise” —
Gary P. Britt, Assistant Vice President,
Sovran Bank, N.A., Richmond, Va.
"Leasing — Give Your Customers and Your
Bank More Options” — Daniel J. Edinger,
President, Telemark, Inc., Syracuse, N.Y.
"Agri-business Lending: Financing Opportu­
nities for Banks”
Luncheon with Guest Speaker. "World Trade
Perspective — What’s Up for Agriculture
after GATT?” — Sen. Richard Lugar (R., Ind.).



Morning concurrent sessions repeated.
Refreshment break.
General session continues.
"How Commodity Market Trends Will Affect
You and Your Customers” — Wayne D. Pur­
cell, Professor of Agricultural Economics, Vir­


ginia Polytechnic Institute and State University, Blacksburg, Va.
"The Legal and Regulatory Environment —
Cautions, Concerns and Compliance”
Champagne Reception with Exhibitors
Reception hosted by Valley National Bank
(one block from Marriott).
Tuesday, Novem ber 15

A .M .

7:00 to
5:00 p.m.
Continental Breakfast with Exhibitors.
Exhibit Hall Open.
General Session.
"Beating the Competition — It’s Do or Die” —
David M. Kohl, Professor, Virginia Polytech­
nic Institute and State University, Blacks­
burg, Va.
"Legislative Update — From the Halls of
Congress to the Corridors of the USDA” —
Floyd E. Stoner, ABA Manager, Community
and Agricultural Banking, Government Rela­
tions, and Rusty Jesser, ABA Federal Legisla­
tive Representative.
Coffee Break with Exhibitors.
Concurrent Sessions.
"Establishing New Farmers” — Ms. Kelli
Evans, President, National Future Farmers
of America, Alexandria, Va.
"How Ag Bank Management Styles Differ —
Or Do They?” — Sanford Belden, Managing
Director, Minnesota First Bank, Minneapolis,
Minn., and Jay Godwin, President, First State
Bank of Canadian, Canadian, Tex.
"New Customers/Best Customers — How to
Have Your Cake and Eat it Too!” — Mike
Moebs. Chairman, Moebs $ervices. Wads­
worth, 111.
"FmHA Guaranteed Loans — The Secondary
Market and the Claims Process” — Honor­
able Vance L. Clark, Administrator, Farmers
Home Administration, USDA. Washington,

Spouses’ Program
Sunday, November 13
1:00 Musical fellowship service, Second Floor, Marriott Hotel.
2:00 Spouse Hospitality Center—Savery Hotel, Second Level.
3:00 Iowa’s Antiques—Gwen Znerold. Savery Hotel, Des
Moines Room.
4:00 Skywalk Walking Tour. Assemble Savery Hotel, Terrace
7:00 NFL TV Game—Marriott, Third Level.
Monday, November 14
7:30 Continental Breakfast—Savery Hotel, Second Level.
Tour buses leave Savery Hotel at Fourth Street entrance.
8:00 Amana Colonies—Nostalgic look backward at communal
living, farming; quaint shops, foods, antiques.
9:00 Discover Des Moines—Civic Center, Botanical Center,
Iowa State Capitol, Terrace Hill (Governor’s Mansion),
Hoyt Sherman House (1877 Victorian mansion) for lun­
5:00 Exhibits/Champagne Opening Reception—Marriott,
Third Level.
6:30 Reception—Valley National Bank, 6th & Walnut.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Tuesday, November 15
8:00 “ A Company Called You” —Savery Hotel, Terrace Room.
Noted Iowa psychologist Dr. Charlene Bell will present
dynamic session on lifestyles, stress and self­
9:45 “ Surviving Stress” —Savery Hotel, Room 308. Dr. Gary
Rosberg, well-known counselor and consultant in Des
Moines, conducts class on preventing and dealing with
9:45 Craft Session: Corn Husk Dolls—Savery Hotel, Des
Moines Room.
9:45 Craft Session: Quilting—Savery Hotel, Iowa Room.
12:30 “ Food, Fun and Fashion” —Younkers Department Store
Tea Room, 5th Floor.
5:15 Exhibit Hall Reception—Marriott, Third Level.
Wednesday, November 16
A.M. Hospitality Center opens.
10:00 Closing General Session—Marriott, Second Level.




Dining, Shopping Touring Guide


ANKERS and spouses attending the ABA Na­
tional Agricultural Credit Conference in Des
Moines will have a wide range of interesting tours,
dining places, and downtown and area shopping
stores and malls. The following is by no means a
complete list, but it represents some of the many
places enjoyed by visitors and residents alike. The
downtown enclosed skywalk system links all major
buildings in the event of inclement weather. The
telephone area code for the Des Moines and central
Iowa area is 515:

Downtown Restaurants
• Guido’s Restaurant, main floor Savery Hotel, 4th & Locust, 2841272. Elegant dining.
• Allies Restaurant and Quenelles Restaurant, Marriott Hotel, 7th &
Locust, 245-5500.
• Kaplan Hat Co., 307 Court Ave., 243-1414.1920’s motif; casual to
elegant dining.
• Spaghetti Works, 310 Court Ave., 243-2195. Italian and American
menus. Informal.
• Babe's Restaurant and bar, 417-6th Ave., 244-8319. Italian and
traditional. Informal.
Near Downtown
• The Imperial House Restaurant and Lounge, 1901 Ingersoll, 2439649. Fine dining.
• Noah’s Ark Restaurant and Lounge, 2400 Ingersoll, 288-2246.
Near Airport

Points of Interest:
• Living History Farms, 2600 N.W. 111 St., Urbandale, 278-5286. A
working farm showing Indian life, farming in 1800s with animals,
and farming with early steam power. Features 1880s town of
Walnut Hill, including bank, mercantile stores, professional offices,
church, blacksmith shop. Tours available. Admission charged.
• Iowa State University, 35 miles north of Des Moines. Includes Ag
College with extensive farms and livestock; College of Veterinary
Medicine; Bio-Tech Center.
• Pioneer Hi-Bred International, Inc. world headquarters, Johnston
(northwest Des Moines), 270-3497.
• State of Iowa Capitol Bldg. Tours daily.
• State of Iowa new Historical Bldg., East 6th & Locust.
• Court Avenue in downtown Des Moines. Numerous office
buildings, restaurants and shops restored to early Des Moines
• Valley Junction (West Des Moines). Two blocks of antique shops,
boutiques, ladies' specialty shops, The Dublin Door (authentic
Irish goods and clothing), old-fashioned ice cream parlor. Iowa’s
finest antique area.
• Terrace Hill — Governor’s Masion, 2300 Grand Ave. A classic
English-style architectural showpiece; five minutes from center of
downtown. For tour information call 281-3604.
Restaurants/ Lounges:
Downtown Clubs
If you are a member of a business club in your city, you may already
have reciprocal privileges with the three downtown private business
clubs that are open for lunch and dinner (closed Sunday). Call for
reservations to:
• Bohemian Club, Capital Square Bldg, ground floor, 4th & Locust,
• Des Moines Club, Ruan Center, 606 Grand Ave., top floor,
• Embassy Club, Financial Center, 666 Walnut St., top floor,




Luncheon with Guest Speaker.
"View From the Hill — The Senate Agricul­
tural Committee Perspective" — A member of
the Senate Ag Committee.
Morning Concurrent Sessions Repeated.
Afternoon Concurrent Sessions.
"Japanese Agriculture — Jane A. Wittmeyer,
Legislative Assistant for Idaho’s Senator
James McClure, Washington, D.C.
"Rural Development” — Honorable Roland R.
Vatour, Under Secretary for Small Commu­
nity and Rural Development, USD A Wash­
ington, D.C.
"Planning for the New Agriculture” — Spon­
sors o f the A B A Journal o f Agricultural
"Commodity Presidents Panel”
Federal Reserve Bank of St. Louis

• The Pier, 4555 Fleur Drive, 285-6996. Seafood, steaks, spirits.
• The Crystal Tree Restaurant and Lounge, 6111 Fleur Drive, 2872032. Fine dining, varied menu, extensive salad bar.
Outlying Areas
• West Des Moines has several restaurants offering traditional and
specialty menus, including Chinese restaurants and others, easily
accessible in 12-15 minutes via Interstate 235 from downtown.
• The Greenbrier Restaurant and Bar, 5810 Merle Hay Rd. (north
part of city), 253-0124. Excellent lounge, elegant dining.
Downtown Des Moines has extensive shops and boutiques in
enclosed skywalk system, as well as:
• Younkers Department Store, 7th & Walnut.
• Madeline Shepard Ltd., 314-6th Ave. High-class traditional and
high fashion clothes for women.
• J.C. Penney's Department Store, 500 Walnut St.
Outlying Areas
• The Silver Fox, 2725 Ingersoll Ave. High fashion.
• Dickinson's, 801 73rd St., West Des Moines (at 8th St. exit from
I-235 in West Des Moines).
• Reichardt’s Clothing, 847 42nd St. Fine apparel for men and
women (off 42nd St. exit from 235 in Des Moines).
• Town and Country, 855 42nd St. Women's apparel (by
• Valley West Mall, 35th & Westown Parkway, West Des Moines
(35th St. exit from I-235 in West Des Moines, turn north).
• Merle Hay Mall, Merle Hay Road & Douglas.
• Southridge Mall, S.E. 14th & Army Post Road.
Children’s Specialty Stores
Ideal for parents and grandparents!
• The Enchanted Cottage, 3811 Ingersoll.
• The Gingerbread Fashion House Ltd., 532 35th St.
• The Red Lollipop, 801 73rd St., West Des Moines (at 8th St. exit
from I-235 in West Des Dickinson’s above). □


Exhibit Hall open.
Refreshment break with exhibitors.
Afternoon con-current sessions repeated.
Exhibit Hall reception.
Wednesday, N ovem ber 16

A .M .

7 :00

Exhibit Hall open.
Continental Breakfast with Exhibitors
Concurrent sessions.
"Siskel & Ebert — Thumbs Up or Thumbs
Down on the Economy” — Dr. Barry L. Flinchbaugh. Extension State Leader, Kansas State
University, Manhattan, Kans., and Mark A.

(Turn to page 30, please)
Northwestern Banker, October, 1988


Historical charts portray
American ag economy
IL L IO N S of words have been written about the
severity of the early-to-mid ’80s farm recession
and the steps taken by state and federal legislators, as
well as lenders, to alleviate the terrible stress of that
phenomenon on all participants in agriculture. In an ef­
fort to visualize various facets of ag production and
the ag economy, we assembled these charts displaying
data based on United States Department of Agricul­
ture reports. They show historical trends for the
number of farms, number of people on those farms, the
size of farms, their production, gross and net income,
and the volume of ag exports and imports.
Figures and charts do not provide a full story or
complete answers, but the historical data in these
charts do portray dramatically the statistics that
underlie some of the problems experienced in this
decade and the direction in which agriculture may be
While the effect of the farm crunch was devastating
to many farmers and their bankers and small town


merchants, it seems to be a culmination of an evolu-*
tionary process that has been taking place for more
than 40 years; in fact, dating back to 1910. In the four
decades following W W I I we have seen a drastic
change in the nation’s social pattern. Am ong those
changes has been a noticeable reduction in the*
numbers of people remaining on farms. A s fewer young
people remained on farms, and older farmers retired,
the land was purchased in many cases by neighbors
who expanded their size as technological advances
made such expansion more feasible.
Into this 40-year evolutionary process of farm attri­
tion, resulting in fewer farmers operating larger
acreages, the adverse factors of spiraling input costs
and high interest rates were injected by double digit in­
flation. Those farmers who were part of the land acqui-*
sition process at that time were hurt badly; many
others were impacted by the adverse effects of high in­
put costs even though they had little or no debt.
During that traumatic period, hundreds of farmers
declared bankruptcy, sold off part of their land, or just
gave up and sold out for whatever they could get. Agri­
cultural lenders were hurt as well, with approximately

Table 1. Gross and net income from farming (including farm households), off-farm income, and total income of farm operator fami­
lies, 5-year averages 1910-39, annual 1986.



Gross income





net farm
-Million dollars

income of
farm operator

Total income
of farm

Net farm income
as percentage ofTotal



Source: USD A statistical reports.
1 Information not available prior to 1960
2 Based on the 1974 Census of Agriculture definition of a farm, which is sales of $1,000 or more and applies to 1975 and all following

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Table 2. Total Population and Farm Population in United States






Table 3. Farm Numbers and Average Acres Per Farm in U.S.

Farm Population
as Percent
of Total

al Total population April 1 for U.S.
Sources: “ Current Population Reports,” Bureau of the Census,





five dozen upper midwest banks being declared insol­
vent and sold off to another bank or, in a limited
number of cases, just liquidated. Climbing back has
been a slow process for many.
A n examination of the accompanying charts shows
how we have arrived at a reduced farming force work­
ing larger acreages, producing more, yet seemingly
earning less. Lower interest rates and lower production
costs the past few years have escalated net income.
Yet, with all the terrible human tragedy and pain
that accompanied the traumatic period of the ag reces­
sion of the 1980s, history will probably show that this
period merely represented a condensation or “ hurrying
up” of the inexorable process of fewer farmers and bigger acreages per farm that has been going on
throughout this century, especially in the past halfcentury.
The story cannot be told completely by charts, but
the ones that accompany this article present some in-


Number of Farms

Acres per Farm





Source: USDA.

teresting statistics that form part of the fabric of the
historical trends in American agriculture.
In Table 1, for example, the 1986 gross income from
farming of $159.5 billion is 20.6 times greater than it
was in 1910, 15 times greater than in the Depression
period of the ’30s, and about six times greater than at
the end of W W I I in 1945. However, this table shows,
among other things, that net farm income as a percen­
tage of gross income (last column) in 1910, 1935 and
1945 was consistently around the 50% mark . . . 51.2%
in 1910, 45.6% in 1935 and back up to 48.5% in 1945.
But from that modern-day high water mark of 1945,
net farm income as a percentage of gross farm income
has plunged almost continuously and was 23.5% in
1986. It was as low as 8.3% in 1983! In other words,
while gross farm income in 1986 was 20.6 times greater
than 1910, the net for 1986 was less than half of what it
was in 1910 (23.5%) as shown in the last column. Table
1 also shows that farm production expenses in 1986

Table 4. Historical Summary: Value of U.S. Foreign Trade and Trade Balance,
Calendar Years 1930-84
Year Agricul- Nonagritural




AgriTotal culturi
Dollars Percer
2,243 33
10,142 28
218,815 13
226,808 12
252,866 11

Year Agricul- Nonagritural




AgriTotal cultural
Dollars Percent
2,039 53
4,098 42
8,743 46

Year Agricul­ Nonagritural


- 1,114
+ 1,008
+ 2,142
+ 1,489
+ 12,566
+ 21,238
+ 19,472
+ 18,470
+ 9,073
+ 4,782
+ 8,239

+ 2,160
+ 4,942
+ 2,513
+ 4,854
+ 4,353
+ 3,710
+ 1,345
- 42,278
- 46,864
- 47,136
- 70,513

+ 1,393
+ 5,487
+ 1,399
+ 4,082
+ 5,361
+ 5,852
+ 2,834
+ 9,630
— 141,849
— 149,200

1/General imports prior to 1934: subsequently, imports for consumption.
Federal Reserve Bank of St. Louis

Northwestern Banker, October, 1988

were nearly ten times greater than what they were in
Table 2 shows that the United States population of
241.6 million in 1986 was 60% greater than the 1950
population of 151.3 million people. But, not surprising­
ly to those who have been close to the ag industry for
many years, the nation’s farm population decreased
from 23.048 million people in 1950 to 5.226 million in
1986. Column three in Table 2 dramatizes this by
showing that farm population in 1950 represented
15.2% of the nation’s total population, while in 1986
the farm population had plummeted to only 2. 2 % of
the total population—only one-seventh of what it was
36 years earlier!
Expressed another way, there was one farm person
in 1950 for every 6.56 persons in the total population.
By 1986 there was one farm person for every 46.2 per­
sons in the total population. This statistic alone testi­
fies to the great advances made in farming knowledge
and technology, as well as the admirable productivity
of the American farmer.
Table 3 offers additional evidence of a 40-year
change in American agriculture. The number of farms
dropped from 5,967,000 in 1945 to just 2,159,000
farms in 1988, a reduction to only 36.2% as many
farms as there were 40 years ago. Similarly, the acres
per farm have more than doubled from 200 acres in
1945 to 463 acres per farm today, or 2.3 times greater
than in 1945. The U S D A also records that the acres of
land in farming in the nation drops about 5 million
acres per year, mostly to urban sprawl, and in 1988
dropped to 998,692,000 acres, the first time ever below
the billion acre mark.
(A U S D A figure cited in the national news media in
August, 1988, reported that the number of farms now
has fallen below the 2 million mark.)
Table 4 displays the frustrating figures involved in
the nation’s exports, imports and troublesome
negative trade balance. U.S. agricultural exports at the
end of 1987 were $28,637 billion, more than 38 times
greater than the $747 million in ag exports of 1935. A g
imports increased to $20,398 billion at year-end 1987,
leaving the U .S. with a positive ag trade balance of
$8,239 billion. However, non-ag imports had ballooned
to $381,668 billion by 1987, compared to non-ag ex­
ports that year of just $224,229 billion, leaving the
U.S. with a trade balance deficit in non-ag trade of
minus $157,439 billion. A fter subtracting the

Table 5. U.S. Corn Production
Source USDA-10/1-9/30
Bushels (billions)
4.462 (9/1)
* PIK and drought
Table 7. U.S. Com’l Hog
Slaughter —Source USDA
Million Head


Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Table 8. U.S. Com’l Cattle
Slaughter—Source USDA
Million Head

favorable ag trade balance of $8,239 billion, that left
the total trade balance for 1987 at $149.2 billion, the
eighth straight year in the red.
Tables 5 and 6 show the dramatic increases in corn
and soybean production that produced the massive
surpluses of recent years, as well as the dramatic effect
on production of this year’s nationwide drought. The
surpluses that resulted from “ fence row to fence row’ ’
planting in many areas have not only been moderated
by the drought but also may be affected by the Conser­
vation Reserve Program that has idled approximately
40 million acres of land, much of it basically untillable
that had been pressed into service.
Tables 7 and 8 relate similar statistics for hog and
beef cattle marketing over the past 40 years.

IBAA Publishes Farmer Mac Booklet
he Independent Bankers Associa­
tion of America has published a
booklet outlining how Farmer Mac,
the secondary market for agricultural
real estate loans, will work and the
importance of the upcoming stock sub­
scription to capitalize it.
"Farmer Mac Facts” provides agri­
cultural community banks informa­
tion, in advance of the stock offering,
about the upcoming stock issue and
how they will be able to use Farmer
The booklet answers such questions
as: Why is community bank represen-

Table 6. U.S. Soybean
Production—Source USDA
Bushels (billions)
(records not kept)
(records not kept)

tation on the Mortgage Corporation
board of directors important? How is
the Mortgage Corporation common
stock structured? What are the Comp­
troller of the Currency, Federal Re­
serve Board, and the various individu­
al states saying about bank purchase
of stock?
Since the initial common stock offer­
ing for Farmer Mac will be issued for
subscriptions in October, the informa­
tion in "Farmer Mac Facts” is particu­
larly important for agricultural com­
munity banks.
Farmer Mac’s operations also are

reviewed. The bulletin describes a hy­
pothetical business relationship be­
tween the First State Bank of Commu­
nity, Iowa, (the loan originator) and
the John Doe com pany (the loan
pooler). An extensive question-andanswer section discusses how an agri­
cultural bank may profit from using
Farmer Mac and the ways that lend­
ing limits, bank reserves, supplemen­
tal lending to the farm borrower and
other banking practices are affected.
Copies of "Farmer Mac Facts” are
available by writing to the IBAA, PO.
Box 267, Sauk Centre, Minn. 56378, or
by calling 1-800-IBA-SAUK. □

T his bank cut processing costs 30%
with aT I com puter system.
W hen J. Sid Dinsdale decided that there
had to be a way his bank could operate
more effectively, he did the smart thing.
He turned to a TI computer Value-Added
Reseller (VAR) that specializes in bank­
ing financial system configuration
and software.
“W hen we committed to computeriz­
ing, we knew we’d save money by bring­
ing our processing in-house. We figured
the payback would take 30 months, but
with our TI system, we’re already well
ahead o f schedule.”

Now, all they have to do is upgrade
their software and add processing power
and terminals where appropriate.
A n easy transition.

Project Manager Steve Zey explains.
“Now our TI computer handles all the
transaction accounting in the bank.
Our transition to in-house processing
was smooth.
“Most of our people were using the sys­
tem within a few hours of installation.”

T I service and support won’t leave
you short.

Texas Instruments has been making and
marketing reliable computer systems for
almost 20 years and offers a coast-to-coast
network to back them.
C all 1 -8 0 0 -5 2 7 -3 5 0 0 .

Find out how your bank’s operations can
benefit from a TI computer system and a
TI reseller’s specialized bank accounting
software. Call the number above for the
TI reseller nearest you.

Investm ent protection you can take to
the bank.

Te x a s
In s t r u m e n t s

Protecting the bank’s computer invest­
ment was a key factor in their decision to
go with a TI system.

Federal Reserve Bank of St. Louis

6 9 6 9 G R O V E R STREET
O M A H A , N EBRASKA 6 8 1 0 6

402- 392-0151


Ten features likely to
characterize agriculture
in the year 2000
Written especially for
T he N o r th w e ste r n B a n k e r

Charles F. Curtiss
Distinguished Professor
Iowa State University
Am es, la.

Editor's Note: Dr. Harl is a nationally-known expert in
the areas of agricultural economics and law. He is
widely sought after as a speaker and writer on these
subjects and has been called upon many times to ad­
vise or testify before Congressional committees.
Recently, he presented a fact-filled, half-day seminaras
the opening morning session for the 1988 A g Credit
Conference hosted by the Nebraska Bankers Associa­
tion in Lincoln. A t that time, he gave a penetrating as­
sessment of United States and world agriculture in the
year 2000 and beyond— "That's only 12 years away!"
he stated. After the meeting, he agreed to prepare this
special summary.

1 • The family farm structure will continue to be the
predominant structural feature. A s the problem of too
much debt concentrated in too few hands recedes in im­
portance in the 1990s, and the problem of global over­
production comes to dominate agricultural policy to an
even greater degree than in the 1980s, pressure on
farm earnings will discourage outside investment in
agriculture, particularly in grain and oilseeds produc­
tion, with family farms that subsist on reduced rations

2 • Average farm size will continue to increase with
application of technologies already known and with ad­
ditional technologies expected to emerge in the 1990s
that boost average farm size.

3 « Farmland values are expected to be only modest­
ly higher in real terms (adjusted for inflation) because
of pressure to adjust excess resources out of agricul­
ture attributable to the capacity to overproduce on a
global basis.

4. Farm income is expected to be under continuing

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

pressure in the year 2000, again because of the capaci- _
ty to overproduce and because additional technology is 9
likely to be introduced that is output-increasing or
cost-decreasing or both.

Government intervention in U .S. agriculture i s ^
expected to recede from 1988 levels and to provide less
buoyancy to farm income in the year 2000.

6 * W ith government intervention receding, t h e ^
acreage of intertilled crops is expected to rise modestly
as some cropland shifts to grazing or other uses and
the use of land substitutes for manufactured inputs.
The amount of idled acreage is expected to decline with £
some cropland shifting to grazing.

7 « International-level competition in agricultural
products is expected to be intense as other countries £
gradually reduce the level of insulation of their farms
from competitive forces on a global basis.

3 • Input suppliers are expected to remain under con- f
tinuing pressure as economic and environmental forces
combine to reduce modestly the level of usage of
manufactured imports.


tJ • Concern about the impact of agricultural produc­

tion on the environment is expected to intensify with
curbs on the use of chemicals and commercial fer­
tilizers in the interests of reducing groundwater pollu­


'• For rural communities relying upon agricul­
ture as the principal economic activity, the level of eco­
nomic vitality is expected to continue to decline (
through the end of the century.





ig Hfference:




purchasing advan­


tages rarely available

fear in any

the local architect

b u i l d i n g

p ro g ram is

that assure you of

that runaway costs

highly competitive

will shatter budgets


and compromise your

estimators using a



tec h n o lo g y -d riv e n

bilities. Bank Building

estimating process,

Corporation virtually

with access to cur­

eliminates that risk.



rent, accurate labor
and materials cost

W e will give
best, most functional building

information from every con­

permitted by your budget...We

struction market in the country

will do it at a mutually agreed

you estim ates you

upon, guaranteed price. You

on, without fear of

won’t have to worry about
overruns. H o w can we

j surprises later in
the project. W e take cost con-

Experience. Careful

very seriously, providing a

The Unified Facilities

fort level you will appre-

ment system, with its

on it. Ask




and owner control. Special
Federal Reserve Bank of St. Louis



(EDITORS NOTE: In addition to his duties at Farmers
State Bank in Trimont, Les Peterson currently is working
with a financial industry group chosen by the Farmer Mac
Interim Board o f Directors to develop underwriting stan­
dards for the secondary market for agricultural real estate
and rural housing.)
HE SECONDARY MARKET for agricultural real
estate and rural housing has the potential to change
life for commercial banks. With that in mind, the Ameri­
can Bankers Association has been looking at this issue,
working to see its achievement as a legislative objective,
and now is intimately involved with developing the
workings of this secondary market known as Farmer
I would like to note a bit of the history of the ABA’s
involvement in this process. In 1981, ABA cited the need
for a source of fixed-rate credit for agricultural real estate.
The alternative sources, primarily the Farm Credit Sys­
tem, were only providing variable rates for financing
farmland. ABA formed a special Presidential Task Force
which put together an inter-industry coalition that in­
cluded the ABA, the Independent Bankers Association of
America, and the American Council of Life Insurance.
That coalition worked diligently from 1986 until Janu­
ary 6, 1988 (when the President signed Farmer Mac into
law), to bring about this secondary market.


W hat’s in Farm er M ac for Bankers

Now that Farmer Mac is law, what does it mean to a
banker like me? Without such a secondary market, I
cannot offer my farm customers fixed-rate loans to buy
farms. The Farm Credit System is the primary lender for
long-term loans to purchase real estate in my area and
that credit is either shorter-term (much less than 30
years) or adjustable rate.
I come from Trimont, Minn., a community of about
1,000 people. My bank serves an agricultural area of
about 30 miles in diameter. In the early 1980s I watched
as land values fell from roughly $4,000 per acre to about
$900 per acre.
The only credit available back then was adjustablerate. There simply was no long-term, fixed-rate mortgage
money to speak of. As a banker, I couldn’t do much about
it. I couldn’t get into the business of making long-term
loans, which meant I couldn’t provide what my customers
desperately needed.
The reason that other agricultural bankers and I could
not offer long-term fixed rate loans, and still cannot today,
is that our bank regulators, rightly, prohibited us from
acquiring short-term funds (as we do through deposits)
and lending them for long-term projects, such as buying
farmland. It is clear from the problems that the S & Ls
have today that a practice of borrowing short and lending
long can lead to trouble if interest rates suddenly spike
upward. With Farmer Mac as an alternative, I should be
able to make long-term loans without facing the problem
of holding them on my books and facing the risk of sharp
swings in interest rates.
H ow the M arket Will Work

Here’s how a secondary market works: once I sell a loan
to a pooler, he then packages it with other loans and sells it
to an investor. The investor assumes the interest rate risk.
Investors are the ones who gamble on the movement of

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Banking on
Farmer Mac#

Written especially for
T he N orthwestern B anker
Les Peterson

Farmers State Bank
Trimont, Minn.


interest rates over a long period of time. They make their
profit by anticipating successfully those movements and
getting a return on their securities for taking that risk.
As a banker I continue to service the loan, so I get to
make my relationship with my farm customer stronger on
a long-term basis. Also, I get to offer a product to the
farmer or rancher that he or she needs. I am another
source of credit for agricultural real estate or for rural
housing and, at the same time, I can offer long-term, fixed
rates in many cases. I have eliminated the risk that
farmer would have faced with a variable rate and I have
eliminated the interest rate risk I would have faced if I
kept the loan on my books.
Benefits for All Parties

Farmers face enough risk with volatile weather and
volatile food prices. They do not need the additional
interest rate risk that they now have with their variable
rate loans. Farmer Mac can provide an alternative to
those variable rate loans, thus reducing some of the
volatility in agricultural finance.
There is also a benefit from competition. The very
existence of Farmer Mac will increase competition and
that should be good for the farmers, ranchers, and even
bankers. I think Farmer Mac also will offer some market­
ing opportunities to agricultural banks which will, for the
first time, be able to offer a full, broad package of real
estate credit, short-term credit and an intermediate
credit, and do all of that at competitive rates.
H ow Banks Will Participate

People ask how various-sized banks will participate in
Farmer Mac. I believe that some small agricultural b a n k s#
will originate loans. I do not expect that all ag banks will
find it in their interest to participate; but those who have a
solid base of farm customers and competent loan officers
will find that they will be able to put together packages for
their farm customers that will benefit those farmers a n d #
be a profit center for the bank.



For regional banks that have an interest in agriculture,
they could both originate and pool loans if they are large
enough to get the kind of geographic and crop diversity
that will be required by the standards for pools of loans.
Some money center banks will probably decide to become
0 poolers and use their contacts with investors as a major
tool in selling the Farmer Mac securities.
In Trimont, I plan to be an originator, perhaps to become
a specialist in agricultural real estate and the secondary
market. The other agricultural banks may decide they
i|| simply want to participate enough to satisfy their custom­
ers’ demands. These banks may not want to develop the
expertise for loan documentation in-house and I expect
that some specialists will develop who can provide these
things. But for any of us as originators, the goal is to be
II able to provide a complete package of financial services for
our farm borrowers, including real estate financing.

“ Secondary markets can reduce the
• cost of mortgages by as much as half to
one percentage point from what they
would have been for a similar product.”
Two M ajor Questions

Two questions that I am asked frequently are, "What
will the cost be, and will Farmer Mac lower interest
^ rates?” Traditionally, secondary markets have lowered
interest rates over time. However, a fixed-rate mortgage
in Farmer Mac cannot be compared to anything that now
exists. Variable or adjustable rate mortgages will always
be lower. Therefore, it is not clear to me how we can
0 compare the cost of a secondary market that provides
fixed rate mortgages to the cost of the variable rates that
are now available.
In general, however, experts on this sort of thing
estimate that secondary markets can reduce the cost of
0 mortgages by as much as half to one percentage point
from what they would have been for a similar product
without the secondary market. But, I hasten to add, we
really don’t have much historical evidence or a reliable
way of determining what the cost of mortgages under
0 Farmer Mac will be at this point.
Pricing mechanisms won’t be determined, in full, until
after the underwriting standards are in place. Looking at
the marketplace, the securities paper in this secondary
market is going to have to be very, very good so that it can
0 meet triple-A standards and so that the interest rates are
beneficial to farmers. Again, using the housing residen­
tial markets as a model, we would expect that over time
both the base can be broadened, which would mean
accepting more average mortgages into the system, and
• that rates would come down.
Many of the details of Farm’er Mac and what the
secondary market offers agricultural banks of all sizes,
will be discussed at ABA’s National Agricultural Bankers
Conference, November 13-16, in Des Moines, In fact, I will
® appear on one of the panel sessions on this subject during
the conference.
A Num ber o f U nknowns

In conclusion, I want to stress that I am both excited by
• the prospects for this secondary market and somewhat
frightened by the enormity of the responsibility to partici-
Federal Reserve Bank of St. Louis

FARMER MAC Interim Board of Directors
Chairman: John R. Dahl* — North Dakota — Rancher
B. Dale Harrison — Ohio — Farm Credit System
Leslie G. Horsager — New Jersey — Commercial Insurance
Randall A. Killebrew — Illinois — Commercial Ag. Banker
Thomas H. Olson — Nebraska — Commercial Ag. Banker
James A. Pierson —- Massachusetts— Farm Credit System
Donald R. Rogge — Texas — Farm Credit System
Edward Charles Williamson, Jr.* — Georgia — Farmer
George Benston* — Georgia — Professor
‘ Nominated by President Reagan to permanent board.
Farmer Mac Chooses
Financial Advisor, Underwriter

The interim board of directors of Farmer Mac has
selected veteran Wall Street securities specialist
Henry D. Edelman to serve as its financial consul­
tant. Mr. Edelman serves as a first vice president
with the New York securities firm Paine Webber.
Mr. Edelman will be responsible for getting Farm­
er Mac up and running as the first step in developing
the secondary market for agricultural real estate
and rural housing mortgage loans.
As his first project, Mr. Edelman assisted the
interim board in its selection of the First Boston
Corporation to be the lead underwriter for the first
issuance of Farmer Mac voting stock. It is antici­
pated that the stock sale will take place during the
autumn. Farmer Mac will raise at least $20 million
in the initial capitalization.
Mr. Edelman also will assist the interim board in
organizing basic budget and accounting systems,
legal oversight and administrative functions. In
addition, he will act as liaison between the interim
board and industry groups as they develop under­
writing standards for the secondary market accep­
tance of agricultural real estate and rural housing
Prior to joining Paine Webber two years ago, Mr.
Edelman was an attorney and director of corporate
finance for General Motors. He served a brief stint in
the investment bank operation of Citibank. At
Paine Webber he oversees federal government fi­
nance. His duties there include assisting the Small
Business Administration and the Department of
Housing and Urban Development in selling portions
of their assets, which was part of President Reagan’s
government loan sales program.

pate in the development of it. We know so little about what
is possible and we must make decisions today that are
going to set up the framework that is being put in place to
provide the benefits that I outlined earlier. There are just
a great number of unknowns.
Pricing, loan documentation, appraisal standards, and
just what kind of relationships will develop between
borrowers, loan originators and poolers of these loans
remains to be seen. So, as I have said, I am excited by the
potential, and we have the model of housing secondary
markets to inspire us. However, there is a lot of work to do
and a lot of decisions that have yet to be made that will
determine just how this market is going to work for all of
us — for farmers, for ranchers and certainly for Les
Peterson, here in Trimont, Minn. □
Northwestern Banker, October, 1988


C EO of failed
Iowa country bank
reflects on the basics
Written especially for
T he N o r t h w e s t e r n B a n k e r

Sigourney, la.

N T H E COURSE of the next few paragraphs, I
would like to share with you several of the promi­
nent considerations highlighting my association with
the Hayesville Savings Bank over the course of the
last several years. The expectations of this article are
not that you will find any new secrets to prudent bank
management, but rather an opportunity to revisit and
appreciate basic banking concepts as they serve all
banking institutions and, in particular, yours.


The final act of closing the Hayesville Savings Bank
was based on its lack of capital and the ramifications
Regulators are very interested in capital from
several perspectives. Obviously, capital accounts
represent the buffer between FDIC continuing to
receive premiums from an institution and having a
loss, or payout, upon the closing of the institution. One
needs to remember constantly that FDIC is an in­
surance company, highly motivated toward limiting
its potential loss exposure. The adequacy of you
capital accounts most directly impacts that potential
loss exposure. F D IC ’s actions appear to be highly
motivated by the above discussed principle.
The willingness of stockholders or a community to
inject new capital into a capital deficient bank is
viewed as a measure of commitment. Returning a
stressed bank to full health does take cooperation
among all involved parties (regulators, stockholders,
management, and the community). All parties must
give and take in the correction process. Willing com­
mitment to inject needed capital would appear to go a
long way in the right direction toward winning the
needed considerations (such as time) necessary for
returning the bank to good health. The situation is
very parallel to one of a borrower who is unable to per­
form on schedule. Collateral position influences the
lender’s attitude greatly toward finding a workout
solution. Offering additional collateral, or not being
willing to grant additional collateral that the borrower
has available, will greatly impact the lender’s attitude
in resolving the problem between the two parties.
A s management, one must guard against taking the
funds provided by the equity accounts for granted. A s

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

a gentle reminder, one should calculate the earnings
generated at a conservative rate (Fed Fund rate) on
average equity and subtract it out of last year’s net
earnings. Doing this in many rural community banks
in recent years would have resulted in a negative
number, or in removing the majority of the year’s pro­
fit. This exercise once again highlights two critical
• First, we are reminded of how critical is the effi­
cient management of net interest spread and operating
• Second, this exercise emphasizes how difficult re­
capitalization by internally generated profit can
become for stressed institutions with greatly dimin­
ished capital accounts.
The concept of risk-based capital standards does ap­
pear to have real merit. A t its largest, Hayesville Sav­
ings bank had total assets of $52 million and was
capitalized at 10.5 percent. Hayesville has a popula­
tion of 80 people. The bank was located seven miles
from the county seat, which has a population of 2,600
people. The county in general is very rural and agricul­
tural. For all practical purposes, the total potential
market represented direct (farm operations) or indirect
(suppliers) dependency on one economic base. Risk
management through diversification in the loan port­
folio was greatly limited. Because of the risk inherent
in the loan portfolio, the degree of risk taken in other
areas (i.e. investments) had to be greatly restricted,
thus limiting income potential in these areas. This
situation also highlights the critical need for non­
interest (fee) income. In net, demographic (social
and/or economic) considerations make risk exposure
unique to each bank, because of the market it serves
and, thus, it would seem reasonable to expect that pru­
dent capital levels will vary accordingly.
In summarizing capital considerations, it would
seem fair to say that capital is to a bank what a heart is
to a body. Even if all else is fine, life cannot be sus­
tained in its absence, or its diminished capacity. W ith­
out sufficient capital, or prospect of same, banks can­
not anticipate a viable future.

Over the years, lenders have debated the merits and
demerits of cash flow versus collateral-based lending. £
In reality, most loans are made out of consideration to
both. A s part of this same discussion it must also be
granted that positive cash flows and earned worth are
not necessarily synonymous. W e much remind our­
selves constantly that principal repayment, for all #
practical purposes, is totally dependent on the realiza­
tion of after-tax profits (earned worth). None of us can
realistically expect to be able to successfully predict
future collateral values or profitability. This fact
would seem to highlight the need to document profit •

(Turn to page 30, please)
■ ABOUT THE AUTHOR— Paul M. Quam resides at Route 2, ®
Sigourney, la., and had served for the past several years as the
CEO of the Hayesville Savings Bank prior to its closing on March
10, 1988. Mr Quam was not an owner of the bank. He holds an
MBA degree with a double emphasis in marketing and finance.
Additionally, he has served as guest faculty to state and national- _
ly sponsored banking schools, as well as a speaker to state and ®
national bank conventions.



Leveraged buyouts
in the
banking industry

Special Reading for
Directors, Management



Asst. Vice President

Vice President



President and CEO
Austin Associates
Toledo, Ohio


This article was prepared as a part o f a monograph
submitted to the Herbert V. Prochnow Educational Foun<!||| dation o f the Graduate School o f Banking, The University
o f Wisconsin under a grant received by Austin Associates
in 1987. The authoris) acknowledge gratefully the finan­
cial and administrative assistance o f the Herbert V. Prochnow Educational Foundation for the development o f this
mill manuscript.
ERHAPS the biggest problem facing the board of
directors o f a commercial bank is the ownership
|| structure. Developing a shareholder base with desired
concentration, age and wealth characteristics is very
difficult. One tool which should not be overlooked when
analyzing shareholder structure is the leveraged buyout.
As this article will illustrate, the leveraged buyout has
|| become a common technique utilized by banks across the
United States and can provide many advantages to the
community, management, directors and shareholders of
commercial banks.



Leveraged Buyout Defined

Leveraged Buyout (LBO) has become a generic term
which encompasses many types of transactions. The
components which are consistently prevalent in LBO
transactions are: 1 ) borrowing of money to purchase a
ip business; 2 ) repayment of debt from the cash flow of the
acquired business, and 3) creation of equity ownership by
the reduction of the debt obligation over time.
A lthough the com ponents o f an LBO are fairly
straightforward, the means and methods by which the
(II end result is satisfied are numerous. Transactions which
are frequently termed as LB Os include: 1) the purchase of
Federal Reserve Bank of St. Louis

an affiliate bank from a large bank holding company by
an investor group; 2 ) purchase of an independent bank by
an investor group, and 3) the reorganization of a bank into
a bank holding company with some shareholders electing
to liquidate their investment. While each of these three
transactions is different in scope, they all have similar
characteristics. Money is borrowed to purchase the bank
and repaid through the cash flow of the bank’s operations.
The ability of an LBO to be successful is contingent
upon a few major factors.
• First, there must be a core group of investors or
shareholders which is loyal to the independence of the
commercial bank. Whether it be through the purchase of a
bank affiliate, or the reorganization of a bank to a holding
company, there must be enough individuals with an
interest in keeping their investment in the bank.
• Second, the bank must have a management staff
which is committed to the success of the bank. The most
common ingredient in a troubled bank is poor or disinter­
ested management. Investors’ money will be at great risk
if management is inept.
• Third, the commercial bank must have the earnings
capacity to repay the debt obligation. Certainly the man­
agement staff has a great deal of influence on the ability of
the commercial bank to make a profitable return. Still,
given a strong management staff and poor earnings, the
leveraged buyout will not be successful.
These three major components of a successful LBO are
discussed in more detail in the remainder of this article.
The Investor Group

The first step in the LBO process is the creation of a core
group of investors or shareholders willing to invest or
continue to invest in the bank. The number of investors in
the investor group can vary extensively. In general, the
smaller the investor group the better, since coordinating a
small group is more easily accomplished. Another advan­
tage of a small investor group is that securities disclosure
is generally less. This will be discussed in more detail
later in this article.
A major disadvantage to a smaller investor group is
that each member must contribute more money to meet
the required amount of capital. The Federal Reserve has
strict guidelines on the amount of capital which must be
invested by the group and the amount of debt which can be
used. Given the ability to repay the debt obligation
Northwestern Banker, October, 1988

through financial projections, the investor group can
borrow a maximum of 75% of the total purchase price. In
other words, the investor group must come up with 25% of
the purchase price in cash (or have a current investment
in the bank). The investors generally must have a signifi­
cant financial net worth and/or current income for ap­
proval by the lender and Federal Reserve.
The role of the investor group is slightly different when
the bank reorganizes into a bank holding company and
subsequently cashes out some shareholders. The investor
group most likely will consist of current shareholders and
possibly management.
Additional investors, if desired, will limit the amount of
debt which needs to be borrowed. This type o f internal
LBO can be used to ward off an offer for the bank, provide
liquidity to certain shareholders and/or help place stock
into younger shareholders’ hands. The major hurdle in
this type of LBO is the determination of the number of
shareholders which will elect to receive cash at a predeter­
mined price. Given a fairly profitable bank, a maximum of
usually two-thirds of the current shareholders could be
cashed out at a "reasonable price.” Using the two-thirds
scenario, the equity interest in the bank holding company
would be the remaining shareholders representing onethird of the shares outstanding. As with all LBOs, money
is borrowed by the holding company and used to cash out
the other shareholders.

“ A bank stock loan from correspon­
dent banks has become an attractive
asset for many regional banks.”
In any LBO transaction, the resulting ownership group
must be fully committed to the use of its funds. This
becomes even more evident given the Federal Reserve
guidelines on dividend payments to shareholders in an
LBO. The Federal Reserve maintains that no dividends
shall be paid to shareholders if the debt to equity ratio of
the organization is above 30%. For example, an LBO with
a 25% equity interest and 75% borrowed money has a debt
to equity ratio of 300% (75% divided by 25%). Exceptions
to restricting dividends may be granted if the repayment
of the debt using financial projections is promising.
Nevertheless, tying up investor’s funds without any cur­
rent income is a big obligation and one that should not be
taken lightly. Disinterested investors who demand liquid­
ity at a future point in time will only be a thorn in the side
of the organization. The investor group or resulting
shareholder base should be loyal to the independence of
the bank with personally sound financial conditions.
Bank Stock Loans

Another key element in an LBO is the successful
retention of a bank stock loan to finance the acquisition. A
correspondent bank, institutional investor or another
financial source should be contacted by the investor group
to apply for a loan commitment. A bank stock loan from
correspondent banks has become an attractive asset for
many regional banks. It is recommended that more than
one source be approached so that a competitive process is
used to realize the best terms. However, a commitment fee
often is charged to the investor group; therefore, a cost/
benefit analysis should be analyzed before applying to
every correspondent bank in the country.
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

“ Not to be overlooked in the entire
process is the application to the
appropriate agencies to gain approval •
of an LBO transaction.”
The potential loan source should be provided with
projections as to the repayment of the proposed debt over a
period of 10 to 15 years. Factors used in projecting the
feasibility of an LBO include the total purchase price for
the bank, the amount of debt incurred, the terms of the
debt and performance ratios of the bank. Areas to monitor
over the 12 years include the capital of the bank and the
debt-to-equity ratio of the holding company. It is recom­
mended that a professional independent advisor be re­
tained to support the investor group’s projections. It is a
fairly complicated process in financially structuring an
LBO, and it lends more support to the investor group’s
projections to get professional help.
In addition to the financial projections, the entire
biographical and financial history of the investor group
should be included with the package to the loan source.
The commercial lender often requires personal guaran­
tees as well as corporate guarantees for the bank stock
loans. This reinforces the belief that the investor group
should possess the financial strength to pay off the loan by
personal means in case the bank holding company is
unable to do so in any given year.






Application Process

Not to be overlooked in the entire process is the
application to the appropriate agencies to gain approval of
an LBO transaction. The major regulator in the process
will be the Federal Reserve Bank in the appropriate
region. The Federal Reserve is the lead regulator of bank
holding companies in the United States. Bank holding
companies must be in place or formed in an LBO in order
to borrow funds to purchase a commercial bank.
The application to the Federal Reserve most likely will
be in the form of an FR Y-l Application. Information
disclosed in this application includes a description of the
proposed transaction; information on the management of
the organization; the effect on the competition and the
convenience and needs of the communities and, most
importantly, a detailed analysis of the financial capacity
of the resulting holding company. This, generally, is the
same information that is provided to the commercial
lender and must meet the Federal Reserve guidelines
discussed previously. Typically, personal financial state­
ments, terms of the loan commitment and projections of
the bank to repay the debt are provided in the financial
information to the Federal Reserve.
The securities disclosures that are required in the
formation and issuance of holding company stock will
vary in complexity. Typically, LBOs of small community
banks will fall under some type of exemption. Either the
small dollar amount or the limited number of investors
will lessen the amount of disclosure. It is preferred that
the investor group be limited to 35 or under since inves­
tors over this amount generally will trigger SEC Regis­
tration under the 1933 Act. Limited disclosure will keep
the registration fees, proxy materials and securitiesoriented documentation at a minimum. The investor










group then can operate under the "Blue Sky” laws of the
individual states, which will lessen considerably the cost
involved with the registration and/or proxy solicitation.
One word of warning in this area is that the investor
group should not advertise publicly for investment in this
transaction. If considered a public offering, the SEC will
require a full-blown disclosure, which is extremely costly
and time-consuming.
The entire time involved with perfecting an LBO
transaction will obviously vary depending upon the com­
plexity of the transaction. However, it can be stated
generally that the formation of a holding company (if
necessary), retention of a loan commitment and Federal
Reserve approval can be gained within 5 to 9 months after
intiating discussion with investors. Although this time
period may not be suitable to certain shareholders needs,
it is certainly well within the scope o f typical transactions
involving sales of commercial banks.
Pitfalls o f an LBO








Loyalty of management and a core shareholder or
investor group, in addition to professional assistance in
application and financial projection processes, are the key
ingredients for a successful LBO. However, there are
other common pitfalls which may be addressed in transacting an LBO.
• Price To Be Paid For Bank — Whether it be an
acquisition of a multi-bank holding company affiliate or
reorganization, the price to be paid to current sharehold­
ers must be well thought out. It is recommended that a
valuation of the stock of the commercial bank be per­
formed by an independent appraiser. The investor group,
along with professional assistance, should factor in the
intangibles such as the market, the management and the
marketability of the stock, which may alter the financial
A purchase from a multi-bank holding company is done
typically on a competitive bid basis. The investor group is
at a disadvantage under this scenario, given that it is
competing with other bank holding companies with far
more financial resources. The investor group must bal­
ance a competitive bid with being able to finance the
• Conflicts o f Interest — Often members of the
investor group are currently directors or officers of the
bank to be purchased. These individuals must be very
careful to distance themselves from any "self interest
dealings” in the transaction. It is essential to confront any

Tom Smith Named President,
Graduate School of Banking
T hom as
Smith has been
named president
of the Graduate
School o f Bank­
ing at the Univer­
sity of WisconsinMadison and its
Prochnow Educa­
tio n a l F o u n d a ­
tion. Mr. Smith,
who is vice chair­
man o f Brenton Bank and Trust Com­
pany, Marshalltown, la., and a director
of Brenton Banks, Inc., has been a
Federal Reserve Bank of St. Louis

conflicting interest which may arise and take appropriate
steps to protect those persons. It is naturally suggested
that extensive documentation be kept to assure minimal
risk to these individuals.
• Optimistic Financial Projections — One major
problem with most investor groups is providing overly
optimistic financial projections. It is important, when
analyzing the feasibility of an LBO, to use reasonable and
slightly conservative projections since the commercial
lender and the Federal Reserve will do the same.
A dvantages o f an LBO

Although there are a number of obstacles to overcome
in the formation of an LBO, there are some major advan­
tages which can be gained from a successful completion.
• First, one of the major reasons why an LBO is
pursued is to keep the local identity of the commercial
bank. Given the support of management and the investor
group, this goal can be accomplished through an LBO.
The local economy and residents often benefit from hav­
ing a local independent bank present.
• The second advantage of an LBO is the opportunity
to provide management with a challenging opportunity to
run its own commercial bank. Whether it be buying an
affiliate of a bank holding company or preventing the sale,
the management staff will have the capability of an­
swering to themselves and not to a regional office.
• Third, an LBO can be a win-win situation for
shareholders cashing out and shareholders remaining.
Given a "fair price,” an LBO can meet the liquidity needs
of certain shareholders while the holding company can
provide a sound investment for shareholders electing to
remain. Further, given a profitable bank in addition to the
tax advantages of debt, the financial return to the investor
group could be substantial.
Sum mary

Boards of directors of commercial banks today face
issues of meeting shareholders liquidity needs, providing
an adequate rate of return to shareholders, and other
shareholder related problems. Often, when faced with
such difficult decisions, the board is uninformed as to all of
its options. The leveraged buyout can be attractive poten­
tially to all involved. This article has provided a general
background on the process, but every LBO has different
characteristics. It is recommmended that the board of
directors discuss the specific situation with professionals
to determine the feasibility of such a transaction. □

member of the school’s faculty for
25 years.
A former treasurer of the American
Bankers Association, and a national
president of the American Institute of
Banking, Mr. Smith is president-elect
of the Iowa Bankers Association. He
succeeds William H. Kennedy, chair­
man of the board, retired, National
Bank of Commerce, Pine Bluff, Ark.
Mr. Smith will serve a three-year
term as president of the School, which
is sponsored by the 16 state banking
associations in the Central States
Conference of State Bankers Asso­
The Graduate School of Banking
was founded in 1945 to provide high

quality, advance bank management
education. Over 15,000 bank officers
have com pleted the program and
many of these graduates now occupy
senior positions in banks across the
Richard I. Doolittle is executive di­
rector and CEO of the School and
Foundation, headquartered in Madi­
son, and James L. Pappas, dean of the
College of Business Administration,
University of South Florida, is aca­
demic dean.
The School’s faculty includes 140
bankers, attorneys, business execu­
tives, economists, and members of
university and college faculties.
Northwestern Banker, October, 1988

A G B A N K E R S CO N FER EN C E. . .
(Continued from page 16)

Edelman, Associate Professor and Public Poli­
cy Economist Iowa State University, Ames, la.
"Understanding the Changed Farm Credit
System” — Frank W. Naylor, Jr., Chairman,
Farm Credit Administration, McLean, Va.
"Breaking New Ground With Alternative
Enterprises for Agriculture” — Michael L.
Tramontina. Deputy Treasurer, Des Moines,
la. Peter A. Hermanson, President, National
Turkey Federation, Reston, Va. John F.
Rooney, Executive Director, Potato Growers of
Idaho, Blackfoot, Idaho. Carl Babler, Manag­
ing Partner, Lafayette Acres, Inc., Cuba City,
"Secondary Markets — the Stairway to Fulfil­
ling Future Borrower Needs” — Floyd E.
Stoner, ABA Manager, Community and Agri­
cultural Banking, Government Relations.
R E FLE C TS ON B A S IC S . . .
(Continued from page 26)
feasibility, and to be in a position to monitor same on a
timely basis. A t the same time, prudent lenders must
look at collateral considerations. One procedure that
appears to have merit, and is very feasible with the use
of a PC, is a spread, by category, of all collateral back­
ing loans. A s an example, ag lines might be categorized
by the following:
A . Real Estate
B. Machinery
C. Breeding Stock
D. Feeder Stock
E. Growing Crop
F. Inventoried Grain
G. Other
Armed with the totals of each category, and the
ratio between categories, the bank can have an objec­
tive awareness of its current risk exposure, with the
ever-changing values of various collateral categories,
and can make management decisions accordingly. A s
regards collateral, Hayesville Savings Bank was real
estate sensitive by a ratio of 271 over the next largest
collateral category.
Various functions of management are carried out in
the various tenses (past, present, future). This is hard­
ly a profound observation. Of relevance is the fact that

RMA Expands Outside
Sales Force
Two new account managers have
been added to Robert Morris Associ­
ates’ outside sales force, it was an­
nounced by Clarence R. Reed, execu­
tive vice president.
They are Anita M. Hill and Lillian
A. Gruhn. Ms. Hill, who is based in
RMA’s southeastern regional office at
690-21D Village Trace, Marietta, Ga.,
has the southeast and southwest as
her territory. Ms. Gruhn, who recently

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis



James E. Murray, author of ABA’s comprehen­
sive training manual on the secondary mar­
ket: Partner, Brown & Wood, Washington,
D.C. Leslie Peterson, President, Farmers
State Bank, Trimont, Minn.
Concurrent Sessions Repeated.
Coffee Break with Exhibitors.
Closing general session.
"Madison Avenue Moves to the Country” —
Robert A. Phinney, Director of Domestic &
International Advertising and Promotion,
California Raisin Advisory Board, Fresno, Ca.
"What’s Ahead for the 1989 A g Conference in
St. Louis?” — Nov. 12-15,1989.
"Aspire to Reach Higher” — Terry Bradshaw,
a four-time All-Pro NFL superstar who led the
Pittsburgh Steelers to four Super Bowl wins,
an actor, TV sportscaster, corporate represen­
tative and widely celebrated lecturer.
Adjournment. □





a given function must be conducted in the proper
tense. In particular, management of the loan portfolio
must be accomplished in the present tense. This
becomes increasingly so with the decline in capital ac- ®
counts and, thus, a diminished ability to take risk. E x ­
aminers evaluate loans in the present tense. In reality,
this is all they can do, as the present affords the most
definable picture of the credit (i.e. present performance
and present collateral values, versus future).
In short it takes great amounts of capital to justify
waiting to take action on non-performing lines, on the
basis that at some time in the future the profitability
and collateral value will return. During stable times a
bank conceivably can go out on the branch for a deser- ®
ving customer. During stressful times you can find
yourself out on the branch with many customers. W ith
the added load, the probability of breaking the branch
is greatly increased. Deteriorating credit lines must be
dealt with immediately. Not doing so accelerates the ®
transfer of risk from the borrowers (where it rightfully
belongs) to the lender, who ideally is not to be at risk.
Lastly, I would remind all of us that not all ex­
periences we are exposed to are pleasant, but all ex- ^
periences do afford us the opportunity to learn and ^
relearn useful concepts. A s initially stated, it is not an­
ticipated that this article will offer any new, profound
banking principles, but rather once again give us all an
opportunity to reflect on the merit of proven banking ^

opened a new RMA midwestern re­
gional office at 120 S. Riverside Plaza,
Suite 1785, Chicago, has the midwest
and west as her territory.

Promoted by Barclays
Philip F. Strauss, Jr. has been pro­
moted to group senior vice president
and manager of the Central Group in
the Business Finance Division of
BarclaysAmerican / Business Credit.
Mr. Strauss oversees business develop­
ment activities and administration of

loans in the 13 states which make up
the Division’s Central Group, Chicago.

RMA Sponsors Loan Review
Workshop in St. Louis


A one-day Loan Review Workshop
focusing on the function and manage­
ment of loan review will be held Octo- 0
ber 28 in St. Louis. The event is de­
signed for bankers with a minimum of
two years’ experience in loan review.
Individuals responsible for managing
the loan review function in small and %
medium-size banks will also benefit.


MICA President Calls for
Claims Arbitration Board
M ortgage lenders and insurers
should work together to establish a
claim s arbitration board to settle
claims disputes, William H. Lacy, pres­
ident o f the Mortgage Insurance Com­
panies of America (MICA), announced
Mr. Lacy called for the claims arbi­
tration board while speaking on a
panel at the National Council of Sav­
ings Institution’s 1988 National Mort­
gage Conference. MICA is the indus­
try trade association.
"Second, Mis are insurance compa­
nies, and we must enforce our policies
for the benefit of all policyholders. An
analogy would be your health insur­
ance. When you submit a claim, it
typically includes costs not covered
and in excess of the limits of your
policy. You get a check for the full
amount covered, but some of the costs
you have to pay yourself. MGIC paid
99.3 percent of our claims in full under
the terms o f our policy last year.”
Lacy told the group that the claims
dollars the private mortgage insur­
ance (MI) industry has paid to policy­
holders prove the need for mortgage
"Evidence of the risks (in mortgage
lending) can be seen in the claims paid
by mortgage insurers. For the first
25 years of its existence, the modern
private mortgage insurance industry
paid $500 million in claims. In the
last five years, claims paid jumped to
$5 billion.
Lacy said mortgage lenders will
continue to need the coverage pro­
vided by the MI industry.

1989 Session

at the University of Wisconsin-Madison
A Tradition With A New Vision.

The critical need for continuing professional education in
banking today is a given. Competition, deregulation, rapidly
changing technology and evolving customer services are
making increasing demands on bank managers. The Grad­
uate School of Banking has undergone significant changes
to meet these changing needs of bankers. The School’s cur­
riculum addresses directly, in innovative ways, the special
educational needs being created within banking today. And
it does so in the most cost effective way, about $100 per day,
including room and meals.

United Missouri Bancshares
to Buy Monroe City Bank




United Missouri Bancshares, Inc.,
Kansas City, has announced an agree­
ment to acquire Monroe City Bank.
The board of directors of Monroe City
Bank and shareholders owning a ma­
jority of the bank’s stock have agreed
to exchange their stock for stock of
United Missouri. The offer is contin­
gent upon the tender of 100 percent of
the stock and approvals by federal and
state regulatory agencies. The stock
offer is valued at $6.8 million.
Monroe City, population 2,600, is
located in the northeast region of the
state near Cannon Dam and Mark
Twain Reservoir. Founded in 1875,
Monroe City Bank has assets totaling
approximately $43 million.
Federal Reserve Bank of St. Louis

------------------------------------------------------CLIP AND MAIL FORM----------------------------------------------

122 West Washington Avenue
Madison, Wl 53703


Please send brochure and application form
Please have someone call re: more information

Your nam e________________________________________________________________
T itle _____________________________________________________________________
City, State, Z ip ____________________________________________________________

Northwestern Banker, October, 1988


Now, you need a correspondent
who knows all the ins and outs.
Not too many years ago interest rates were stable,
loan demand was strong and borrowers provided
a high quality loan portfolio. Overline assistance
was needed. Marquette Bank was there.
Today interest rates fluctuate, loan demand is
scft and making new loans is a very selective
process. Your investment portfolio now must pro­
vide more o f your bank’s income. Marquette Bank
is there.

Correspondent Bankers and Investment
Counselors teamed in a coordinated effort. People
w ho’ve proven their skills to our customers for
years. People who care about your business and
take the time to understand and execute your
investment philosophy.
If you’re looking for a bank with the experi­
ence to know all the ins and outs o f successful
banking, look to Marquette.

Correspondent Services Division/lnvestment Department

Correspondent Services 341-6561
MN Wats 800-862-1452
National Wats 800-328-8155
Federal Reserve Bank of St. Louis

Marquette Bank
Minneapolis Member FDIC

Investment Department

MN Wats 80C-642-7582
National Wais 800-328-8013

years in the correspondent bank
department, resigning as vice presi­
dent to accept the Fairmont Na­
tional appointment.
The First National Bank of
Jackson has $47 million in assets,
while The Fairmont National has
$37,312,000 in assets. The two
banks will be operated as separate
charters following regulatory ap­
proval. Jackson is 28 miles due west
of Fairmont in south central Min­
nesota, just above the Iowa line.

Community First Names
Region Manager
The board of directors of Com­
munity First M innesota Bankshares, Inc., headquartered in
Fargo, N. Dak., has appointed
David A . Lee to serve as region
manager for the Minnesota bank
holding company. Mr. Lee currently
serves as president and CEO and as
a director of American National
Bank of Little Falls, a Community
First affiliate. He will continue to
serve in those capacities. He has
been president of American Na­
tional since 1982.

Agreement Reached to Sell
*1 First National of Jackson







Robert M. Burnham, chairman
and president of The First National
Bank of Jackson, has announced
that an agreement has been reached
to see the majority stock in the bank
owned by the C.A. Burnham estate
to John E. Goodenow and James M.
Hongslo, subject to regulatory approval.
Mr. Goodenow is chairman of
Goodenow Bancorporation, head­
quartered in Spirit Lake, la. The
holding company’s principal bank is
W all Lake Savings Bank in Wall
Lake, la., of which Mr. Goodenow is
chairman, president and chief execu­
tive officer. Mr. Goodenow also is
chairman of Fairmont Bancorporation, which owns control of The
Fairmont National Bank in Fair­
Mr. Hongslo is chairman and
president of The Fairmont National
Bank, the position he assumed in
October, 1986. Prior to that time he
had been with the Security National
Bank in Sioux City, la., for 15 years
following his gratuation from the
University of South Dakota in Ver­
million. He served most of those
Federal Reserve Bank of St. Louis

Promoted in Pine City
Edward W . Palmer has been pro­
moted to president of Pine City
State Bank. He
has been with
the bank since
1983 and pre­
viously served
as executive vice
p resid en t and
cashier. Prior to
joining Pine City
State, he was
with First Bank
System, serving
at affiliate banks in North Dakota,
South Dakota, Montana and Min­

Winona Bank Forms
Leasing Subsidiary
The Merchants National Bank of
Winona has announced a major exsion of its opera­
tion s th rou gh
the formation of
a leasing subsi­
d ia r y .
H ead­
q u a r te r e d
B lo o m in g to n
and with an of­
fice in Winona,
Merchants Cap­
ital Resources,
Inc. will serve
Minnesota, western Wisconsin and
northern Iowa.
J. Roger Meier has been named
president of the leasing subsidiary.
He had been sales manager for Hub­
bard Leasing Company of Mankato,
and has also worked for ITT Indus­
trial Credit, St. Paul; Norwest Leas­
ing, Minneapolis, and the Omaha
National Bank.

Named in East Grand Forks
First Bank System has named
Daryl Evavold president of First
Bank East Grand Forks. In addition
to his new responsibilities, Mr.
Evavold will continue to serve as an

account executive in the client
Mr. Evavold began his career
with FBS in 1981 as a management
associate. In 1982 he was appointed
to commercial lending officer and in
1987 to account executive.

V.P. Named in Virginia
Gerald Johnson has been pro­
moted to vice president at First
Bank Minnesota, Virginia office. He
joined FBS in 1986 and serves as a
product group manager.

Promoted in St. Cloud
John E. Leisen, president of Zapp
Bank, St. Cloud, has announced the
promotion of Marci Axtm an to staff
accountant/investment coordinator.
She has been with the bank for one

Richfield Bank Sponsors
Seminar Series
Richfield Bank & Trust Co, Rich­
field, is sponsoring a series of four
seminars which will be presented by
Gumphrey Learning Centers, Inc.
for Attorneys, CPAs and Financial
Planners. The series began Septem­
ber 1 with “ Internal Trust Under­
standings.’ ’ Upcoming topics are
“ Trust Officers Duties and Working
with Life Underwriters’ ’ (December
1), “ Trusts and How They W ork’ ’
(February 23) and “ Case Study of
Living Trusts and Testamentary
Trusts’ ’ (April 13). The seminars
cost $30 each and are held from 6:00
to 10:15 p.m.

Sullivan Work Displayed
in Owatonna
An exhibition of the architectural
ornamentation of Louis Sullivan,
widely regarded as the most spec­
tacular and original art of its kind in
America, was presented in Owaton­
na September 13 through October 9.
The display was held at the
Owatonna Arts Center, about ten
blocks from one of the best pre­
served examples of a total Sullivan
architectural enterprise: the down­
town banking office of Norwest
Bank Owatonna.
The collection of Sullivan pieces
was salvaged from 28 different
buildings built between 1881 and
1919, m ostly in the Midwest.
Sullivan designed the Owatonna
bank in 1906 and it was completed
in 1908.
Northwestern Banker, October, 1988


First Bank System announced on
September 16 the appointment of 19
bank presidents and four business
line managers in the Twin Cities.
First Bank recently organized its
community banks into four Twin
Cities metro markets.
Norb Conzemius, president of
community banking for the St. Paul
East Metro Market, announced the
following appointments:
Craig Bollum, who is president of
First Bank, Payne Avenue.
Jerry Thole, who is president of
First Bank, Midway.
Patricia Crowns, who is president
of First Bank, Grand Avenue.
Jim Widen, who is president of
First Bank, Battle Creek.
Tom Madden, who is president of
First Bank, White Bear Lake. The
First Bank, Lakewood office also
reports to him.
Gary Woeltge, who is vice presi­
dent and manager of private bank­
ing and community business bank­
ing, First Bank, St. Paul.
Dianne Arnold, who is executive
vice president and manager of con­
sumer banking, First Bank, St.
Paul. Also reporting to her are the
Shoreview, Highland and Little
Canada offices.
Colleen McCoy, president of com­
munity banking for the Minneapolis
Central Market, announced these
Mark Ouradnik, who is president
of First Bank, St. Louis Park.
Linda White, who is president of
First Bank, W est Broadway. The St.
Anthony and Apache offices also
report to her.
Dave Zelinsky, who is president
of First Bank, Lake at 25th Avenue.
Also reporting to him is the Lake at
Bloomington Avenue office.
Ann Melendez, who is vice presi­
dent and manager of consumer
banking for First Bank, Minnea­
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis







Chuck Peterson, who is vice presi­ nounced recent promotions:
dent and manager of community
John Crenshaw and Kathlyn
business banking, First Bank, Min­ Kastner Slater were recently pro­
A vice president and manager of
private banking for First Bank, Min­
neapolis has not yet been named.
Neel Johnson, president of com­
munity banking for the South Metro
Market, announced the following ap­
pointments in his market:
Bruce Soma, who is president of
First Bank, Bloomington. Also
reporting to him are the W est
Bloomington and Lyndale offices.
Bob Stehlik, who is president of
First Bank, Edina, with offices at
50th and France and 70th and
Sandra Lipsey, who is president
of First Bank, Apple Valley.
Eric Iversen, who is president of
First Bank, Eagan.
Sandy Anderson, who is president
of First Bank, Burnsville.
Scott Hutton, who will become
president of First Bank, Eden
Prairie, which will include the
Suburban National Bank following
regulatory approval. He is currently
serving as the transition manager.
Dave Gilman, president of com­
munity banking for the North/West
M etro M arket, announced the
following appointments:
Paul Elsome, who is president of
F irst Bank, M innetonka. The
Ridgedale office also reports to him.
Gary Peterka, who is president of
First Bank, Hopkins.
Duane Ostlund, who is president
of First Bank, Robbinsdale.
Bill Stangler, who is president of
First Bank, Plymouth. Also repor­
ting to him is the Brooklyn Park of­
Kirby Scroggins, who is president
of First Bank, Northtown. The Coon
Rapids office also reports to him.

moted to vice presidents, mortgage
banking services in the special in­
dustries group. Mr. Crenshaw began
with FBS in 1964 and M s. Slater
came to FBS in 1984.
The loan portfolio management
group of FBS recently promoted
James Melville to vice president,
special loans real estate. He joined
FBS in 1985 and was an assistant
vice president.
Mark Paynter was promoted from
assistant vice president to vice
president, finance. He came to FBS
in 1980.
David Morem has been named
vice president of finance, metro com­
munity banking. He joined First
Banks in 1979.
The corporate banking group has
announced the promotions of Sally
Webber Centner and Terry Steen to
vice president, upper Midwest divi­
sion; David Draxler to vice presi­
dent, national division; Jeffrey Torrison to vice president, national
agribusiness; and Steven William
son to vice president, corporate
* * *
Norwest Corporation announced
on August 30 plans for a new bank­
ing office in Edina as part of a pro­
gram to expand its community
banking operations in the Twin
Cities suburbs.
The new facility, to be known as
the Edina office of Norwest Bank
Minnesota, N .A ., will be located at
5116 Vernon Avenue in a building
currently undergoing extensive
renovation. The new office was
scheduled to open for business on
September 19.
Dan Saklad, Norwest’s regional
president for Minnesota/Wisconsin,








said Norwest intends to expand its
community banking business in
other suburban communities with
either new banking offices or en­
larged quarters over the next six to
12 months.



Nelson D. Civello has been named
executive vice president and head of
FBS Capital Markets Group. He has
nearly 20 years of experience in
banking, investment banking and
public finance, most recently with
Marine Midland Capital Markets, a
division of Marine Midland Bank in
New York, where he was director
and deputy division executive of the
municipal securities division.
* * *
William M. Wingfield has been
promoted to senior vice president
and manager, trust securities pro­
cessing, for Securities Processing
Services, Inc., a subsidiary of First
Bank System.
He joined FBS in April of this
year from Wachovia Bank and
Trust, Winston-Salem, N.C., where
he was vice president of trust opera­
tions services. He has more than 15
years of bank and trust automation/operations experience.



Robert E. Leech has been pro­
moted to executive vice president of
First Trust. He most recently served
as senior vice president of the per­
sonal trust group of First Trust. In
his new position he will continue to
manage the personal trust group.
Prior to joining First Trust in
1985, Mr. Leech was president of
First Bank of South Dakota and
senior vice president of the trust
* * *
Midway National Bank, St. Paul,
has announced recent promotions.
Susan A . Hagen has been pro­
moted from commercial loan officer
to assistant vice president in the
commercial lending department. She
joined the bank in 1981, and has
served as loan administrator and
credit department manager. Prior to
coming to St. Paul, she was assis­
tant cashier and compliance officer
at the Bank of Buffalo Grove, 111.
John B. Hermanson has been pro­
moted to commercial lending officer.
He previously served as credit
department manager, also in the
commercial banking department. He
Federal Reserve Bank of St. Louis



joined the bank in 1984 as a credit
analyst, was appointed as officer
and credit department manager in
1986, and was subsequently as­
signed additional supervisory res­
ponsibilities for the bank’s loan
auditing section.
* * *
Marquette Insurance Group has
announced that four of its em­
ployees have purchased the property
and casualty division from the In­
surance Group. The new agency is
called M IG Insurance Brokers, Inc.
Marquette Insurance Group will
continue to offer life insurance,
employee benefits plans and other
financial serves products from its
new headquarters in the Piper Jaffray Building in Minneapolis. M IC
Insurance Brokers officially opened
for business on August 1 and will re­
main at 7401 Metro Boulevard in



stop payment service that allows
commercial customers to use their
office personal computers to stop
payment on a check and receive in­
stant binding printed confirmation
of the stop payment order.
Karl Ostby, vice president of cash
management for Norwest, said it is
the first on-line stop payment pro­
duct in the Upper Midwest. The
Norwest “ BankTIES Stop Pay”
system allows customers to request
a photocopy of a check which has
been paid. The system features
tiered pricing based on volume
breaks on the number of accounts a
business has and the number of stop
payment requests generated each
month per account.
Several Minnesota-based com­
panies participated in the design
and pilot use of the product, in­
cluding ID S Financial Services,
Inc., Blue Cross Blue Shield of Min­
nesota, and Target Stores.
Norwest Bank Minnesota has also
introduced a new software product
that enables corporate customers to
pay state taxes electronically in In­
diana through personal computers.
That state recently became the first
state to require electronic payment
of corporate taxes.
Norwest officials said they are the
first bank to provide a software
package that enables companies to


Norwest Banks have introduced a

(Turn to page 41, please)

In Northern Minnesota, Stanley
r > >- 1

Meet Stanley
Norwest’s Correspondent Banker for North­
ern Minnesota. When you have correspond­
ent banking needs, he’s a good person to
know. Stanley makes it his business to under­
stand the special needs of community banks.
And he wants to do business with you. Talk
© 1988 Norwest Banks

to Stanley about our complete line
of specialized correspondent banking
services. When it comes to correspondent
banking, he’s got you covered.

Member F D IC

Norwest Bank Minnesota, N .A .

Northwestern Banker, October, 1988

You’re looking at a big way First Banks
can help you make money A state-ofthe-art trading room that gives you instant
access to the largest bond inventory in
the Upper Midwest. So you can shop more
check more rates and returns,

©1988 First Bank System
Federal Reserve Bank of St. Louis

quickly spot trends and opportunities,
and precisely match investments to objectives. With First Banks’ unmatched
resources behind you, you can even share
in the benefits of large block buying without spending large sums of money

You can also see a few of our other
If you’re ready to make the most of
advantages: advisors who specialize in cor- your portfolio, call FBS Capital Markets at
respondent bank investing. Experts per(612) 343-1936. _
sonally committed to meeting your needs, We’re just
* p__.
following your lead, and making your
Members First Bank System
investments pay off.
Federal Reserve Bank of St. Louis

Members FDIC

Illinois Bank, where she was second
vice president and group marketing
Lori S. Stern is assistant vice
president in the cash management
sales department. She joins the
bank from Connecticut National
Bank in Hartford, where she was
relationship manager and assistant
vice president in the insurance in­
dustry department.
* * *

Joseph F. Tomasello has been
named president of Avenue Bank of
Elk Grove. He
joins the bank
fro m
P la in s Bank of Illinois,
fo r m e r ly D e s
Plaines National
Bank, where he
Ht Ä
m o st recently Í
served as senior
vice president of
the commercial
lending division.
Prior to joining PlainsBank, he
worked at the First National Bank
of Chicago as a commercial banking
* * *

H [H |


Arnold E. Davis has joined Am al­
gamated Trust & Savings Bank as
vice president in the marketing
department. Previously, he was vice
president and chief lending officer
for Illinois Service Federal Savings
and Loan Association in Chicago.
Prior to that, he was a vice president
at Continental Bank. A relationship
manager for municipalities and
labor unions in Continental’s public
funds division, Mr. Davis also
worked in the public finance division
of the bank.

Mr. Staples succeeds Daniel C.
Rohr, who has resigned to become
executive vice president and chief
credit officer at Columbia Savings
and Loan Association in Beverly
Hills, Calif.


Allen G. W olkey has been named
senior consultant for compliance ser­
vices at Financial Shares Corp. He
comes to the organization from the
Federal Reserve Bank of Chicago,
where he served most recently as
vice president of bank relations. He
(Turn to page 70, please)

Gerrie M. Smith has been ap­
pointed vice president in charge of
retail banking for the Affiliated
Bank Group, Inc. She previously
served as senior vice president and
cashier for the Affiliated Bank/
North Shore National. Prior to that,
she worked for Unity Savings/
Talman Home Federal Savings and
Credithrift of America.





Amalgamated Trust & Savings
has also announced that Timothy J.
Bresnahan and Elcosie Gresham
have been appointed to the bank’s
board of directors. Mr. Bresnahan is
business manager of Local Union
134 of the International Brother­
hood of Electrical Workers. Mr.
Gresham is president and business
agent of Local Union 241 of the
Amalgamated Transit Union.




Three new officers have joined
The Exchange National Bank of
Gordon L. Mason is vice president
in the bond department and will
manage the government trading
desk. He previously was with Rodman and Renshaw, where he was
vice president in charge of the
municipal trading and underwriting
Lynn M. Orawiec is vice president
and retail development manager.
She previously was with Continental

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

William L. Staples has been
named chief credit officer and chair­
man of the credit policy committee
of Continental Bank. He was respon­
sible for Continental’s credit risk
evaluation division from 1983 to
1985, before becoming head of the
money market distribution, public
finance and municipal securities
division. Since October 1987, he has
handled special assignments for the
bank’s credit risk management area.
He joined the bank in 1965 and has
held a number of commercial lending
positions in Chicago and New York






1st Natl. Collinsville and
UMB Banks To Merge
The boards of directors for First
National Bank of Collinsville and
U M B Bank of Illinois in Maryville
have elected to merge the two banks
into U M B First National Bank. The
merger was effective August 31.
Under the merger, the bank has
combined assets of almost $157
million. Its main office will be in Col­
linsville, with offices also in Mary­
ville and Caseyville, a total of four.
The board of the merged bank in­
cludes directors from the previous
banks’ boards. Gary Haskell will
serve as chairman and chief ex­
ecutive officer, with David Skiles as
president, Richard Dawdy as ex­
ecutive vice president, and Scott
Thomas as senior vice president.
The bank is an affiliate of United
Missouri Bancshares, Inc., a multi­
bank holdin g com pany head­
quartered in Kansas City, Mo.


management of operations at the
bank and its subsidiaries.
Mr. Troia will also continue as
vice p r e sid e n t/o p e ra tio n s and
treasurer of Valley Bancorporation.
He has been with the organization
for 19 years.

Goldman Elected NABW
Pres, for Fox Valley









First Wisconsin Announces
Acquisitions in Minnesota
On September 14, First W iscon­
sin Corporation completed the
acquisition of Century Bancorp,
Inc., a one-bank holding company in
Circle Pines, Minn. Terms of the
transaction were not disclosed.
Century Bancorp owns the $26
million Centennial Bank.
First Wisconsin has also announced that it has reached an
agreement to acquire the $160
million Stillwater Holding Com­
pany, headquartered in Stillwater,
Stillwater Holding Company has
controlling interest in the $120
million First National Bank of Still­
water. Through its ownership of
Hugo Bancorporation, Inc., a onebank holding company, it also owns
the $40 million First State Bank of
Hugo, based in Hugo. Terms of the
transaction, which involved an exchange of stock, were not disclosed.
In addition to its main office in
Stillwater, the First National Bank
of Stillwater has two branch offices,
one in Stillwater and one in Lakeland. The First State Bank of Hugo
has a branch office in Lino Lakes.
No staff changes are anticipated.
Upon completion of this acquisi­
tion, expected during the first
quarter of 1989, First Wisconsin will
have purchased a total of nine banks
in Minnesota with 26 locations and
over $850 million in assets.

Named in Madison
Sal A. Troia has been named
senior vice president of Valley Bank,
• Madison. He will assume respon­
sibility for the overall direction and
Federal Reserve Bank of St. Louis

Kristine Schulz Goldman, cor­
porate legal administrator and com­
pliance officer with Valley Bancor­
poration, Appleton, has been elected
president of the Fox Valley Group of
the National Association of Bank
Women, Inc.
M s. Goldman was awarded in
1986 for “ Outstanding Contribu­
tions to the Department of Legal
Administration.” She was recently
asked by the FDIC Washington of­
fice to be guest speaker for a com­
pliance seminar.

Promoted in Sun Prairie
Robert J. Maly has been named
computer operations officer at
Valley System, Inc.’s Sun Prairie
location. He has been associated
with Valley for six years, most
recently as computer operations

Meet Bill Meyer,
Norwest’s Corre­
spondent Banker
for Wisconsin. When you have correspon­
dent banking needs, he’s a good person to
know. Bill makes it his business to under­
stand the special needs of community
banks. And he wants to do business with
© 1988 Norwest Banks

Two new appointments have been
announced in the data control
department. Jane Mathweg and
John Montgomery have been named
data control supervisors. M s.
M athw eg was employed since
March, 1987 as a balancing clerk.
Mr. Montgomery has been with
Valley for ten months, most recently
at the Valley Bank on Monona

Valley Offers Next Day
Deposit Availability
Valley Banks is offering next day
deposit availability at its 88 loca­
tions. Nearly all checks deposited at
the Valley banks will be available for
withdrawal the next business day,
with a few exceptions determined on
a case-by-case basis.
Federal regulations now require
next day access for certain items
such as cash deposits, electronic
transfers, and deposits of U.S.
Government checks. “ The regula­
tion was written to protect con­
sumers and businesses from having
their funds held for an excessively
long period,” said Sal A . Troia, vice
president/operations and treasurer
for Valley Banks. “ But really it is
not as pro-consumer as Valley’s own
practice of next day availability.”

you. Talk to Bill about
our complete line of specialized correspon­
dent banking services. When it comes
to correspondent banking, he’s got you


Member F D IC

Norwest Bank Minnesota, N .A .

Northwestern Banker, October, 1988

Luverne Hammerstrom, Cashier
Carol Crawford, Assistant Cashier
Drew Anderson, William R. Lennon
and George Hanson.
The bank has assets of $25.6
million and deposits of $ 21.2 million.
No staff changes are anticipated.

Promoted in Sioux Falls


Timothy Hamel has been pro­
moted to vice president, trust, at
First Bank of South Dakota, Sioux
Falls. He joined FBS in 1984 and
most recently served as an assistant •
vice president and corporate trust

Britton Bank Fails

Named in Huron

Added in Mitchell

The Marshall County Bank in
Britton was closed August 19. Its
deposits were assumed by First Na­
tional Bank of Beresford. The bank
had deposits of $9.6 million and
assets of $10.5 million.
The failed bank’s offices in Brit­
ton and Veblen are now branches of
First National of Beresford.

Farmers & Merchants Bank of
Huron has named Ronald R. Jenkins
executive vice
p resid en t and
commercial len­
ding officer. He
is a 24 year
veteran of bank­
ing. Mr. Jenkins
m o st recently
was president of
Trust and Sav­
ings Bank in
Mitchell, also serving as a director
of that bank until 1985. He retired
from banking in 1985 to become in­
volved in Mitchell Community acti­
vities, primarily in the area of physi­
cian recruitment.

Harlan Nielsen has joined the
Mitchell staff of Norwest Bank
South Dakota as mortgage loan
originator/personal banker. Since
1981, Mr. Nielsen has been with 0
Century 21, Koupal and Anton, Inc.
He has been an associate broker
since 1984.

Canton Bank Sold
Local officers and directors have
purchased controlling interest in
Farmers State Bank of Canton. The
bank had been owned by three local
Purchasing the bank were Chair­
man Elmer Anderson, President
Bruce Anderson, Vice President


# ^

Community First Announces
Managem ent Changes
The board of directors of Com­
munity First National Bank of Wahpeton has elected Ronald K. Strand
president and chief executive officer
and a director of the bank. William
M . Sanger has resigned those offices
but will continue to serve as chair­
man of the bank.
Mr. Sanger has resigned to accept
the position of vice president of cor-

porate relations for Community
First North Dakota Bankshares,
Inc., Fargo. He will continue to be a
shareholder of the bank and con­
tinue to serve as a director of the
bank holding company. He joined
the Wahpeton bank in 1964 and has
served as president since 1971.
Mr. Strand has resigned as presi­
dent and chief executive officer of
Norwest Bank of North Dakota—
Wahpeton to accept the position at
Community First. He had served as
president of the Norwest bank since
1985. From 1983 to 1985 he was
senior vice president of Norwest
Bank—Jamestown. He began his
bank ing career at N orth w est
Bank—Moorhead, Minn, in 1973.
In addition to his positions in
Wahpeton, Mr. Strand has been ap­
pointed region manager from the
Community First North Dakota
Holding company.

Minot Bank to Remodel


Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

First Bank Minot has announced
plans to spend $500,000 remodeling
its building at 17 First Avenue
Southwest in downtown Minot. The
project has already commenced.
The 25 year old bank will remodel
all three floors with new ceilings,
lighting and furniture. The drive-in

Dakotah Declares Dividend
Rodney Fouberg, chairman of the
board of Dacotah Bank Holding Co.,
announced recently that the board
has declared a three percent stock
dividend in lieu of its semi-annual
cash dividend. The stock dividend
will be paid on September 27 to
shareholders of record on September





teller window will also be modified.
Upon completion of the project,
First Insurance, a bank affiliate, will
move its offices to the second floor O
of the bank building.

Pfeifle Elected ICBND Pres.
Myron Pfeifle, president of Bis­
marck State Bank, was elected
president of the
Banks of North
Dakota during
their recent an­
nual convention.
The conven­
tion was held at
the K irk w ood
M otor Inn in
Bism arck, and
attended by 300 bankers, their
spouses, and associate members.
Mr. Pfeifle has been with the
Bismarck State Bank since 1978,
when he was hired as vice president.
He was promoted to executive vice
president and CEO in 1980 and
president and CEO in 1982.
Between 1975 and 1978, Mr. Pfei­
fle was vice president of the Elk
N O R TH D A K O T A N E W S . . .
(Turn to page 47, please)

J. Henry Schoenewise, Rhonda J.
Bryant and Margaret A . Colbert
were named asset management of­
ficer, operations officer and invest­
ment officer, respectively.

United Banks Elects S.V.P.

United Bank of Denver
Announces Promotions

A number of promotions have
been announced recently by United
Bank of Denver:
Robert A . Brown, portfolio
manager in asset management ser0 vices, has been named vice presi­
dent. He recently joined the bank.
Brad L. Meuli, who joined the
bank last year, was also promoted to
vice president. He works in regional
II corporate banking.
Named assistant vice presidents
were Christopher B. Johns, asset
management services; Brian J.
Baker, special assets; Barry B.
II Chesnut, manager of general ac­
counting and regulatory reporting;
Kip H ughes, m anager of the
women’s banking center, and Gary
B. Lutz, cash management.
Named commercial banking of­
ficers were M . Elizabeth Hummel,
Lisa L. Montgomery, Bruce W .
Panter, Henry S. Romaine Jr.,
Carolyn L. Salmans, Randall J.
II Schmidt, John M . Varnell, Melinda
A. Yarborough and Marlain E.

II (Continued from page 35)
initiate an automatic clearing house
tax credit electronically through a
PC. The new program is an add-on to
|| the BankTIES program.
* * *

Susan K. Koonsman has been
elected senior vice p r e s id e n thuman resources
at United Banks
of Colorado. She
has been with
U nited B an ks
since April 30,
1987, when the
merger of Uni­
ted and IntraW est Financial
Corporation was
fin a lize d . She
became vice president— human
resources in early 1988.
M s. Koonsman spent ten years
with the Manville Corporation
before moving to The First National
Bank of Denver in 1981.

Pres. Named in Durango
John A . Marvel has been named
president and chief executive officer
of The First National Bank of
Durango. He is a former chief ex­
ecutive officer of the First National
Bank of Alamosa, and more recently
was president of the Montana Bank
of Bozeman, Mont. He has been with
The First National Bank of Durango
since September, 1987.

provides project planning, design,
art production and communications
services, audio-visual support ser­
vices and video production services.
It also operates an art production
studio and manages the company’s
graphics identification standards.
* * *

Norwest Corporation has named

Patrick M. Redmond to a new posi0 tion as creative
art director for
its in-house art
an d
d e s ig n
group. He had
0 been operating
his own consul­
t in g
fir m ,
P a tr ic k
R ed­
m ond D esig n .
<pThe a rt and
d e s ig n g ro u p

Federal Reserve Bank of St. Louis

Marquette Bank Minneapolis has
announced the addition of two of­
ficers to its staff.
William Endres joins the bank’s
loan administration division as as­
sistant vice president. Previously,
he was a member of the liquidation
division for the FDIC. Prior to that,
he held various management posi­
tions at several Minnesota banks in­
cluding Pope County State Bank of
Glenwood, State Bank and Trust

MBA Meets to Discuss
Bank Structure Proposal
A t a recent meeting of the M on­
tana Bankers Association board of
directors, a draft of proposed
changes in bank structure was
Said M B A President Lynn Grobel, “ W e are working on a bank
structure proposal that will improve
services to the consumer and help
Montana’s economy.” According to
Mr. Grobel, a number of changes in
the proposal, such as allowing banks
to merge and consolidate plus pro­
vide banking facilities in com­
munities not now served by banks,
are being considered.
In response to an economic con­
sultants report to the Governor’s
Council on Economic Development,
Mr. Grobel said, “ Montana bankers
are also concerned about archaic
banking laws holding us back from
providing competitive financial ser­
vices to all Montanans. Our asso­
ciation will try to modernize bank
laws and regulations in the 1989
Legislature for everyone’s benefit.”

Co. of New Ulm, Roseville State
Bank, and First Bank in St. Paul.
Mike Sexton joins the bank
business services group as assistant
vice president. M ost recently, he
was the vice president of finance and
adminstration at Hoffman Electric
Company. Prior to that, he was an
assistant vice president at First
Bank Minneapolis.
* * *

Marquette Bank Minneapolis’s
main bank at 6th and Marquette has
been chosen as the location for bank
scenes filmed for the CBS Entertain­
ment movie, “ The Comeback.”
Filming in the lobby, skyway, and
on the marble staircase of the bank
took place on August 23. The movie
stars Robert Urich.
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis


200 Attend Ag Credit Conference
By B E N H A L L E R , JR.









N E X C E L L E N T turnout of 200
registrants for the 1988 A g
Credit Conference sponsored by the
Nebraska Bankers Association Sep­
tember 1 and 2 at the Lincoln Hilton
Hotel was a substantial increase
over the 1987 attendance. The annual A g Credit Conference is hosted
by the N B A Lending Committee, of
which Ken Ward, senior vice presi­
dent and cashier of Cornhusker
Bank in Lincoln, is chairman. He
was assisted in moderating the
business sessions by two of the
other 15 committeemen—Mike Ja­
cobson, senior vice president, Na­
tional Bank of Commerce, Lincoln,
and Richard Nelson, vice president,
Farmers State Bank & Trust Co. of
Two men were honored with
plaques at the first day luncheon for
their numerous contributions to
agribusiness at the state and na­
tional level. They were U.S. Trade
Representative Clayton Yeutter and
Kirk Jamison, Nebraska director for
the Farmers Home Administration.
N B A President Harley Bergmeyer,
president of Saline State Bank,
Wilber, presented the awards.
He cited Mr. Jamison for “ his
willingness to go to bat for
Nebraska farmers and ranchers to
make F m H A programs work as they
were intended,” mentioning speci­
fically Mr. Jamison’s excellent work


in establishing the F m H A ’s A p ­
proved Lender Program in Neb­
raska. The Cornhusker state leads
the nation in lender participation in
the Approved Lender Program.
Ambassador Yeutter, who could
not be present, was chosen as co­
recipient because of his remarkable
success in negotiating export agree­
ments that have significantly im­
proved the federal export picture,
especially for ag commodities. A m ­
bassador Yeutter is a native of
Eustis, Neb., and is a graduate of
the University of Nebraska in Lin­
coln, where he received a Ph.D. in ag
economics and a law degree.
Dr. Neil Harl, the Charles F. Cur­
tiss Distinguished Professor of
Economics at Iowa State Universi­
ty, Ames, presented a five-part
seminar that ran throughout the
first morning session. His talks
looked at U .S. Agriculture in a
World Setting, Government Farm
Programs, Lender Liability: Pro­
blems and Pointers, and Develop­
ments in Agricultural Real Estate
To strengthen U .S. agriculture,
Dr. Harl said, the short-term need is
for the government “ to provide ad­
justment assistance. In the long­
term we must increase demand
sharply or reduce production. One of
our most promising solutions to our
over-production is encouraging in­
creased food consumption in non-ag
countries.” This can be accom­
plished, he added, “ by helping them
to do what they do best by utilizing

their low-cost labor to produce
goods for export so they will have
money to import from u s.”
Dr. Harl used extensive slides and
charts to illustrate all of his discus­
sions. Throughout the latter part of
his remarks he referred to the future
of agriculture and the positive and
negative factors that could affect it
by the year 2000— “ and that’s only
12 years aw ay!” To outline his pro­
jections for our readers, Dr. Harl
prepared the special summary that
appears in the feature section of this
issue outlining ten factors to con­
sider for agriculture in the year 2000
A .D .
Thomas H. Olson, president of
Lisco State Bank in Lisco., Neb.,
spoke in his capacity as one of the
nine appointed members to the in­
terim board of the Federal Agricul­
tural Mortgage Corporation. That
corporation, known now as Farmer
Mac, was contained in H.R. 3030,
the Agricultural Credit A ct of 1987,
which was signed into law January
6, 1988 by President Reagan. That
was known primarily as the Farm
Credit System rescue bill, but con­
tained Title V II creating the secon­
dary market for long-term ag real
estate loans and allows banks and
other financial institutions equal ac­
cess to the market.

LEFT— Kirk Jamison, FmHA state director for Nebraska, and his wife, Trula, admire the plaque given to Kirk by the NBA in recognition of
his numerous contributions to the State of Nebraska. With them are, from left: NBA Pres. Harley Bergmeyer, pres., Saline State, Wilber;
NBA Lending Comm. Chmn. Ken Ward, sr. v.p. and cash., Cornhusker Bank, Lincoln, and NBA Exec. V.P. Stan Matzke. RIGHT— Two of the
prominent guest speakers at the Ag Credit Conference were Thomas H. Olson (left), pres., Lisco State Bank and past pres, of IBAA, and Dr.
w Neil Harl (third from left), the Charles F. Curtiss Distinguished Professor at Iowa State University, Ames. They are pictured with Mr.
Bergmeyer and Mr. Matzke.
Federal Reserve Bank of St. Louis

Northwestern Banker, October, 1988


Nebraska News

LEFT—Three Nebraska bankers who had a big hand in the creation of the idea for Farmer Mac when they served together on the
ABA/IBAA Joint Task Force to look at lending alternatives for bank ag lenders were, from left: Tom Olson, pres., Lisco State and past p r e s #
of IBAA; Mel Adams, chmn. & pres, of Adams Bank & Trust, Ogallala, and C.G. Kelly Holthus, pres., First Natl., York, pres.-elect of the ABA.
Mr. Adams and Mr. Holthus also are past presidents of the NBA. RIGHT—Commodity speaker Richard A. Brock (left), pres, of Brock
Associates, Milwaukee, visits with NBA Lending Committee member Mike Jacobson, sr. v.p. Natl. Bank of Commerce, Lincoln, who pre­
sided at final session.

Mr. Olson reported action of his
subcommittee that met in Denver
August 26 to hear presentations
made by 11 investment firms bid­
ding to handle the $20 million stock
sale scheduled to be offered in Oc­
tober. He said “ A B A and the IB A A
have worked hard together to assure
that as broad a range of banks as
possible may participate in purchase
of this stock.” He said it appears
likely it will be offered in increments
at least as low as $5,000 to en­
courage widespread bank participa­
tion. “ This is a real positive step for
community banks to expand their
ag real estate loans by accessing na­
tional markets through Farmer
M ac,” he stated.
Rusty Jesser, federal legislative
representative for the American
Bankers Association in Washing­
ton, D.C., presented the “ Washing­
ton Legislative Issues/Up and Down
the H ill.” This centered on another
look at Chapter 12, the Farm Credit
rescue bill and the Secondary
M arket that resulted, drought
legislation, mediation laws, and
other current banking legislation
under study.
Frank W . Naylor, Jr., chairman of
the Farm Credit Administration in
McLean, Va., who is responsible for
regulating and overseeing the Farm
Credit System, recalled the 1971
legislation revamping the FCS.
“ One side said loans to be made
should be at 75 percent of the
agricultural business value of that
property. The other side merely had
a higher number. It wound up being
80 percent of appraised value. If it
had been 75 percent of the business
value, look at how many problems
we would have avoided!”

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Registrants and spouses were
taken by bus to the U N L Center at
the University of Nebraska In­
stitute of Agricultural and Natural
Resources. Professors from the A g
College made five concurrent presen­
tations from which guests could
select the one they wished to attend.
Following a banquet at the facility,
Dr. Irv Omtvedt, vice chancellor for
Agriculture & Natural Resources,
was the speaker.
The entire program the second
morning was devoted to “ Commodi­
ty Prices—Making Decisions in Dif­
ficult Times,” and presented by
Richard A . Brock, president of
Brock Associates in Milwaukee,
W is. Mr. Brock is widely-known and
respected by farmers and bankers
alike for his thorough, accurate
reports that serve as guides for
thousands of his readers. He used
extensive charts to discuss com­
modity prices, the tools needed by
producers to market their crops, the
tim ing that is necessary, the
banker’s role in advising on a
farmer’s marketing programs, and
developing the consistent marketing
plan itself. A few of the comments
offered by Mr. Brock follow:
“ Even with the worst drought
ever we’ve only hit $3.40 per bushel
on the corn, showing that the
30-year cycle is still valid.”
“ Keep the stock market in
perspective. Between 1965 and 1985
it moved only between 700 and
1,000. Now, people think 2,700 is the
norm and cry when it ranges bet­
ween 1,900 and 2,100. It was 1,250
in 1 98 5!”
“ The bond market is about ready
to make a move to the upside. I
think we’ll see bonds in six months

trading at par. W hy? The Fed thinks#
it will control inflation. The dif­
ference between inflation rate of 4
and the prime at 10 means the real
cost of money is 6 . It can come down
now. The bond market today is t e l l #
ing us it’s going higher. It was up
IV2 last Friday.”
The 1988 A g Credit Conference
concluded with a noon luncheon and
an address given by Tom Osborne,#
head football coach for the Universi­
ty of Nebraska. After giving a short
assessment of his team ’s opening
victory over Texas A & M and a brief
review of key players on the 1988#
team, Mr. Osborne said “ The one
true thing that lasts, and is most im­
portant in each person’s life, is
character. It is the main thing and
all else fades away. Building#
character is made up of several com­
“ 1. Discipline—Learning, study­
ing and doing over and over again

University of Nebraska head football coach
Tom Osborne (seated left) is pictured with
NBA Pres. Harley Bergmeyer (right) and pro­
gram speaker Rusty Jesser, ABA federsd^

legislative repr., Washington, D.C.


A p ow erfu l, m o d e m , top-of-the-line electronic data processing system is not beyond your reach,
regardless o f the size o f your institution.
W e have one for you. T w o, in fact.
First National Bank o f O m aha’s Information Processing System is as versatile, efficient and pow erful
as y ou ’ ll find anywhere. A n d it’s available to you. D ozen s o f banks are already linked with us electronically
to receive the full com petitive benefits o f this state-of-the-art service.
O u r In-H ouse P rocessing System , established in your institution, is fu lly controlled by your management
and functions on your timetable. Staff time is conserved, overhead reduced, processing costs stabilized
and services im proved. It’s designed for optim um efficiency in financial institutions o f varying sizes and
O u r E D P services are your m ost affordable and valuable option. Give us a call; we need to talk.
M ichael J. D o o le y • National M arketing D irector • First National Bank o f Om aha
O n e First National Center • O m aha, Nebraska 68102 • (402) 341-0500


firs! n a tio n a l b a n k
of omaha
one first national center
omaha, nebraska 68102
Federal Reserve Bank of St. Louis

what needs to be done, and to the
best of one’s ability.
“ 2. Perseverance—This attribute
is highly important. More than 125
years ago a young man’s fiancee
died shortly before they were to be
married. He grieved a long time; he
suffered by going bankrupt in two
businesses; he was defeated a halfdozen times when he first ran for of­
fice. But he had perseverance and
Abraham Lincoln became our 16th
president. He showed that it’s not
that you fail, it’s how one reacts to
“ 3. Teamwork—There are two
kinds of players. The first asks,
‘W h a t’s in it for me? How much per­
sonal attention and glory is in it for
m e?’ The second kind is a team
player who asks only, ‘W hat can I
contribute to be better to help the
team?’ Happiness as a member of
the team depends on your stance
toward life.
“ 4. Loyalty —W e tell our players,
‘If this place is not what you want,
see us and talk about it. If you have
a beef with a teammate, talk it out.
If we can’t get things straightened
out, then you’d be better off some­
place else and we’ll help you to the
extent we can.’
“ 5. Be multi-dimensional—Learn
about the rest of the world besides
athletics. Learn about life. W e ’re
physical, mental and spiritual be­
ings and we need a balanced life.
One-dimensional people can’t cope
with adversity such as an injury, or
personal problems such as divorce.
That’s why we have chapel each
Saturday morning, so our players
have a feeling for this important
dimension of their lives. You need
balance in your lives, as well, besides
banking, farming or other business
The meeting concluded following
the luncheon.

The following promotions were
recently announced by Norwest
Bank Nebraska:
J a c k A y r e s was named senior vice
president of development. He began
his banking career in Manhattan,
Kan., in 1971. In 1982 he moved to
the Tri-County Bank and Trust in
Bellevue and was chairman of the
board and president there until
1985. He then became chairman of
the board and president of the Bank
of Bellevue, and held that position
until joining Norwest in May.
J o h n C. P e a r s o n has been named
vice president in the commercial real
estate department. He began his
banking career in Wichita, Kan., and
moved to Omaha in 1985 to work as
vice president in a savings bank. In
1986 he became a vice president and
manager of a mortgage corporation.

Elected in Plainview
Roger D. Synovec has been
elected president of Plainview Na­
tional Bank of Plainview. He joined
the bank in 1972 and has held the
positions of vice president and ag
loan officer, senior vice president,
and most recently, executive vice
president and chief loan officer. He
succeeds Eldon R. Fox, who was
with the bank over 25 years.
Merle D. Johansen was elected
senior vice president of the bank. He
joined Plainview National in 1980 as
vice president.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis



T h o m a s J . B e h m e r is an assistant
vice president in the ag department
at the Norwest Bank Nebraska in
Hastings. His financial career began
in 1986 when he began working for
Farm Credit Services as an assistant
vice president in the special assets
division. He joined the Federal Land
Bank Association in 1979 as a loan
officer and branch manager.
L a u r e n c e R a y n o r began working
in the trust department of Norwest
Bank Nebraska’s downtown Omaha
bank in April. He formerly served as
a high school teacher and counselor
and as an account executive for an
investment firm.
* * *





C h r is t in e M . C a r p in o
has been
named vice president and director of #
marketing and sales for American
National Bank of Omaha. She most
recently served as field marketing
manager for Godfather’s Pizza. She
was director— strategic planning for #
Data Documents from 1983 to 1986
and worked in corporate finance and
strategic planning for Enron Corp.
from 1979 to 1983.
* * *

A ‘ ‘ Gala Family Fun N ite” was
sponsored by Douglas County Bank
& Trust Co. on Saturday, September
17 at Rosenblatt Stadium. Entitled £
“ Together, L et’s Dream,” the event
featured vocal and band music and a
fireworks display. Bank customers
were invited to attend the fun night
for free.





Norwest Bank Nebraska, N .A .
recently displayed the work of sculp­
tor M a t t P la c z e k in the lobby at the £
bank at 20th and Farnam.


Union Bank and Trust Company,
(§ Lincoln, has received FDIC ap­
proval to merge with the Pawnee
County Bank, Pawnee City. The
Pawnee County Bank will be
operated as a branch of Union Bank
<9 and Trust. No staff changes are anti­
* * *

Elected in Kearney
M ary C. Thaut was elected
cashier of First National Bank and
Igi Trust Company
of Kearney at a
recent meeting
of the board of
directors. M s.
0 » Thaut was for­
merly assistant
vice president of
operations at Ci­
N a t io n a l
4 ) Bank in H a s­
tings. Previous
to that, she was employed by the U n­
ited Bank of Greeley, Greeley, Colo.

Name Changes Announced

Bailey Lewis & Associates, a
Nebraska-based advertising, mar­
keting and public relations firm with
offices in Lincoln and Omaha, has
been chosen as the agency of record
for the Nebraska Higher Education
Loan Program, Inc. (NEBHELP)
and the Nebraska Student Loan Pro­
gram, Inc. (NSLP).

(Continued from page 40)
Valley State Bank in Larimore. He
began his banking career with the
Farmers and Merchants Bank in
Aberdeen, S. Dak., in 1970.
Mr. Pfeifle has served for several
years on the ICBN D Executive
Council, and as chairman of the
association’s General Services Com­
mittee. He serves on the Banking
Services Committee of the Indepen­
dent Bankers A s s o c ia tio n of
America, is a member of the Na­
tional Community Banker Advisory
Board for the American Bankers
Association, and has been active in
the Bismarck Chamber of Com­
merce. He is also active in civic and
church organizations.
Other officers of the IC BN D are:
P re sid e n t-E le c t— Terry M cN e a ,
president, Farmers & Merchants
Bank, Hatton, and Vice President—
James Goetz, president, State Bank
of Oliver County, Center.

Abbott Bank Group has an­
nounced that ten banks in the group
have changed their names to “ The
Abbott Bank.” The banks will re­
main under separate charters.
Banks changing their names in­
clude the Guardian State Bank and
NDBA Group Officer
41 Trust Co., Alliance; the Bridgeport
State Bank; the Bank of Chadron; Candidates Announced
Gordon State Bank; the Bank of
The Nominating Committees of
Hyannis; the Bank of Hemingford; the four N D B A Groups indicated
the Bank of Mullen; the Merriman plans to present the following slates
O Bank, the Bank of Valentine, and of candidates for group officer posi­
Citizens State Bank of Thedford.
tions at the meetings which were
Federal Reserve Bank of St. Louis

held the week of September 26:
Northeast Group: President—
Peter K. McKenzie, vice president,
Lam b’s Bank of Michigan City. Vice
President—Terry Rime, president,
Farmers & Merchants Bank, Langdon. Secretary/T reasu rer— M ike
Granlund, vice president, Northwood State Bank.
Northwest Group: P re sid e n tWilliam C. Parker, vice president,
First American Bank, Rugby. Vice
P resident— Zinie Peterson, ex­
ecutive vice president, Lakeside
State Bank, New Town. Secretary/
Treasurer— Frank Keogh, senior
vice president, American State
Bank, Williston.
Southwest Group: President—
Ronald Braseth, president, First Na­
tional B an k, H e ttin g e r. V ice
President— Gerald Wilier, president,
Kirkwood Bank & Trust Co., Bis­
marck. Secretary/Treasurer— Delores Maier, vice president, Security
State Bank, New Salem.
Southeast Group: R.J. Klinkhammer, president, First American
Bank, Casselton. Vice President—
Steve Dahlstrom, vice president,
Farmers & Merchants Bank of
Valley City. Secretary/Treasurer—
Jerry Woods, president, First Bank
of North Dakota—Fargo.
Additional nominations will be ac­
cepted from the floor during the
group meetings. The four newlyelected group Vice Presidents and
the S o u th e a s t G r o u p ’ s new
Secretary/T reasurer will begin
three-year terms on the N D B A E x ­
ecutive Council following the 1989

American Natl. Honors
ICBND with Tree Plantings
To commemorate the contribu­
tion made by independent communi­
ty banks to the growth and vitality
of North Dakota, American Na­
tional Bank of St. Paul, Minn., has
donated 106 tree seedlings to the
North Dakota State Park Board for
planting in the new Cross Ranch
State Park project.
The presentation was made on
September 8 at the annual conven­
tion of the Independent Community
Banks of North Dakota by Craig
Mueller, assistant vice president of
American. The gift was related to
the convention theme, “ Our Roots
Run Deep.’ ’ The 106 seedlings were
meant to represent the 106 members
of the ICBN D.
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

v .


-*« •





■": V Ä > » . :>CSS ^ < vs> T w . :.< /'- <:.







* , *.<-.

Here To Serve You Well

*»rN ¿v 1



'H .


Firslier Bank Omaha and Firslier Bank Lincoln are a
dominant financial force throughout the heartland. We
know this area and its people. That’s why we're the
institutions to turn to for help with your own needs, or
when serving the needs of your customers.
As a member of the $2 billion Firslier Financial group,
we offer the experience, expertise and financial strength
that few can match. And we mean business for those
we serve.
Count on your FirsTier Team to serve you well.

F irs T ie r B an ks
Federal Reserve Bank of St. Louis



In Nebraska: 800-642-9305
Outside Nebraska: 800-228-9175

In Nebraska: 800-742-7462

FirsTier Bank, N.A., Omaha and FirsTier Bank, N.A., Lincoln, Members FDIC

When you're doing things right, there's
no reason to change. That's why, for 71
years, Bankers Trust has not changed things
that are important to our customers:
• We have not changed our first priority —
providing our customers the very best
service possible.
• We are still locally owned. And that means
we care about local Iowa customers.
• We are still doing business on the same
downtown block where we first opened
our doors.

• And, in 71 years, we have never changed
our name.
For almost three-quarters of a century, peo­
ple have been able to rely on Bankers Trust.
We've earned our reputation for service and
stability, and we're proud of our good name.
We've helped local businesses grow —
many have become major corporations.
And we've helped generations of people —
individuals like yourself — to achieve their
personal financial goals.
That's a record in Des Moines that nobody
— nobody — can match.

Member FDIC
Federal Reserve Bank of St. Louis

the IB A structure, Dale C. Froehlich, president and CEO of Ankeny
State Bank in Ankeny, also was elec­
ted in the August mail ballot as
treasurer-elect, a position created to
give more continuity to the increas­
ingly important job as treasurer.
Neil Milner continues as execu­
tive vice president and CEO of the
IB A professional staff in Des
Moines headquarters.

Sunday Business Meetings

OFFICERS of the Iowa Bankers Association for 1988-89 are, left to right: Immed. Past
Pres.— Clair J. Lensing, pres., Farmers State, Marion; Exec. V.P.— Neil Milner, Des Moines;
Pres.— Donald E. Snyder, pres., Manufacturers Bank & Trust, Forest City; Treas.— Thomas
t|| B. Gronstal, pres., Carroll County State, and Pres.-Elect— Thomas R. Smith, vice chmn.,
Brenton B&T, Marshalltown.

Don Snyder Named IBA President

Associate Editor

Associate Publisher



W E L C O M E R A IN fell during

r \ , the Iowa Bankers Association
convention last month, giving
registrants further reason for their
upbeat mood. Speakers gave en4IHcouraging talks about the continu­
ing economic recovery in Iowa and
the Midwest, although looking over

their shoulders at the earlier part of
the 1980s and adding a touch of cau­
tion to their comments.
Donald E. Snyder, president and
chief executive officer of the
Manufacturers Bank and Trust in
Forest City moved up to the IB A
presidency, succeeding Clair J. Lensing, president and CEO of Farmers
State Bank in Marion. The new
president-elect, named by mail
ballot by IB A members in August,
is Thomas R. Smith, vice chairman
of Brenton Bank and Trust in M ar­
shalltown. Continuing as treasurer
for the second year of his two-year
term is Thomas B. Gronstal, presi­
dent and CEO of Carroll County
State Bank, Carroll. Although he
does not have officer status within

The annual business meetings for
the Iowa Bankers Association, Iowa
Bankers Insurance and Services and
members of the American Bankers
Association were held Sunday after­
In his report to the IB A member­
ship, Executive Vice President Neil
Milner said I B A ’s long-range plan
was set in motion five years ago and
is being reviewed constantly by the
board of directors. “ The board has
now put in place a strategic plan for
the future,” he said, “ not just a
technical document, but a living
document. It has built-in, meas­
urable criteria to monitor the plan’s
progress, to make sure it is keeping
pace and performing for the mem­
bers.” On the legislative front, Mr.
Milner said feedback from Iowa
House and Senate legislative leaders
indicates that when they are asked
by various groups how to do a better
job, the elected representatives say,
“ Go talk to the Iowa Bankers A sso ­
Mr. Milner said there is an expan­
ding interest in BankPac, which now
has exceeded 1987 participation but
is still short of the level of several
years ago. “ However,” he added,
“ we have turned the trend line up­
ward again.” He said IB A members
soon will receive a new personnel

LEFT— United Missouri Bank of Kansas City hosted their annual dinner during the IBA Convention. Enjoying themselves were, from left:
Mark Bailey, a.v.p., host bank; Jack Rigler, pres., Central State, Muscatine, and his wife, June; Carlene and Patrick Moehn, pres., Commer# cial Savings, Carroll, and Jeff Gobel, v.p., host bank. RIGHT— Also present were, from left: Max Larson, pres., First Natl., Sioux City; Dick
Muir, v.p., host bank, with Sheryl and Duane Prill, chmn., Pleasantville State.
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis


Iowa News

LEFT— Present at the Merchants National Bank hospitality suite were, from left: David Neuhaus, pres., Fairfax State Sav.; Jerry Trudo,
v.p.; Bob Louvar, v.p., both with host bank, and Bill Talen, chmn. & pres., Farmers Sav. B&T, Traer & Vinton. RIGHT— Taking part in the
Banks of Iowa reception were, from left: Larry Gilb, pres., host bank; Terry Martin, v.p., Merchants Natl., Cedar Rapids, and his wife, Dixie;
Jim McConnell, chmn. & pres., Somers Sav., and his wife, Susan, and Jim MacLean, v.p., Valley Natl., Des Moines.

LEFT— First Bank Minneapolis hosted a luncheon during the convention. Taking part were, from left: Al Highum, v.p., host bank; Al Maser,
chmn. First Natl., Lemars; Ken Bezdicek, v.p., and Dewey Senneseth, v.p., both with First Bank Mpls. RIGHT— Cole Taylor Bank/Drovers
held its luncheon during the IBA Convention. Guests included Bill Boehm, pres., Tama State; Vaughn Hartzell, rtrd., Mechanicsville Tr. & •
Sav., and Max Roy, sr. v.p., host bank.

manual, as well as a catalogue of all
services and products available
through the IB A .
Gerald F. Lapke, retiring chair­
man of IB IS and president of the
Shelby County State Bank in
Harlan, introduced the other ten
members of the IB IS board. The
new chairman will be Norman D.
Skadburg, president at First State
Bank in Webster City. The new
member of the IB IS board is Paul H.
Johnson, the IB A representative on
the board. He is president and CEO
of Iowa State Bank, Algona.
IB IS President Frank Gleeson
said, “ 1988 was a good year. W e in­
creased business by 18 percent to
$2.3 million in premiums.” Mr.
Gleeson gave a review of each divi­
sion of IB IS and noted progress in
each of them.
Russell S. Howard, A B A state
vice president for Iowa and chair­
man of Mahaska Investment Co.,
Oskaloosa, conducted the brief A B A
meeting. Named to succeed J. Bruce
Meriwether, president of First Na­
tional Bank, Dubuque, to a two-year
term as an A B A Leadership Con­
ference delegate was Clair J. Lensing, now immediate past president
of IB A .

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Monday General Session
The morning session of the con­
vention began in traditional fashion
with a tribute to outgoing IB A
President Clair Lensing. Mr. Lensing’s positive attitudes about bank­
ing and how they are reflected in his
selection of the “ C-O-O-P” theme
were related during the presenta­
First speaker for the morning was
Dr. John G. Stoessinger, professor
of international affairs, Trinity
University, who explored present
economic conditions and the future
of the American economy in the
light of international relations.
Dr. Stoessinger expressed his
amazement at improved relations
with the Soviet Union, and advised
bankers to take advantage of a new
market: “ A lot of bankers will be go­
ing to Russia to look for business.”
Possibly even greater oppor­
tunities are opening up in China. Dr.
Stoessinger said, “ W e are talking
about one-fifth of the human race
turning from communism to capi­
talism. ’ ’ He warned bankers that the
Chinese are very slow and deliberate
in their dealings, a fact often
discouraging to Americans and ad­
vantageous to the patient Japanese.

“ Do not become provincial,” he ad­
vised. “ You want to get in on the
ground floor before the rest of th e #
pack catches on.”
A s for the Japanese, Dr. Stoess­
inger expressed deep concern about
their influence over the American
economy. “ W e [the U.S.] h a v e #
become a fire sale for the Japanese
for the last three to four years,” he
said. He foresaw the October, 1987
stock market crash and considers
the main factor to be the sudden#
boycott on American bonds by the
Japanese, who previously had been
heavy investors. “ Twenty-five per­
cent of our American standard of liv­
ing is borrowed Japanese funds,” h e #
Dr. Stoessinger then compared
the attributes of Japanese and
American students, crediting them
with discipline and c rea tiv ity ,#
respectively. “ The secret to success
is to combine creativity and dis­
cipline,” he said. “ Those who do will
control the market.”
Dr. Stoessinger closed by relating#
the saga of his youth, when he
escaped the Holocaust in Europe on­
ly to be captured in Russia and sent
to the Gulag. He subsequently fled
to Japan, where he was witness to #

Iowa News


LEFT— Davenport Bank & Trust hosted a convention-wide breakfast and participants included Jim Figge, off. of pres., host bank; Bob
Sierk, pres., First Natl., la. City; Stan Barber, chmn., Wellman Sav., and Michael Bauer, 1st v.p., host bank. RIGHT— Pete VanSistine, Valley
Systems, Inc. and Gary Stevenson, right, v.p., First Natl., Sioux City, visit in the exhibit hall.

LEFT—Visiting at the IBIS, Inc. exhibit were, from left: Max Kiernan, pres., Alton Sav.; Ron Meyer, v.p., IBIS, Inc.; Larry Gilie, v.p., IBIS, Inc.;
(||Oan Jessen, exec, v.p., Farmers Sav., Weaver; Bill Carr, v.p., IBIS, Inc.; John Fagerland, pres., Maquoketa State, and Jim Jensen, v.p., IBIS,
Inc. RIGHT— Guests at the Midwest Management Consultants exhibit were, from left: Kevin Harding, farm repr., and Ralph Wollenhaupt,
pres., both with First Natl., Fontanelle; Janel and Bob Neville, v.p., Midwest Mgmt., Omaha, and Gene Young, v.p. & cash., Treynor State.

LEFT—Showing their wares at the Office Concepts, Ltd. exhibit were, left: Dick Bremicker and Ross Schoonover, with guest banker,
center, Steve Land, v.p., Security Sav., Farnhamville. RIGHT— Visiting at the Modern Banking Systems, Inc. exhibit were, from left: Gil
Baehler, MBS, Inc.; Gary Schoeni, pres., Farmers & Traders Svgs., Douds, and Mike Reynolds, reg. sales mgr., MBS, Inc., Omaha.

LEFT—At the Laser Pro exhibit were, from left: Royal Nold, sr. v.p., Iowa St., Algona; Doug Wall, Century Systems, Des Moines; Dave Windle, CFI Bankers Services, Portland, Ore.; Curt Gressman, cash., Polk City Sav., and Gary Livesay, v.p., IBIS, Inc./Laser Pro. RIGHT— Tak­
i n g part in one of the many concurrent sessions were, from left: Chuck Bonsteel, Steve Porter and Jim Wolf, all with James Baker & Co,
Oklahoma City. They spoke on “Theories of Investment Portfolio Management.”
Federal Reserve Bank of St. Louis

Northwestern Banker, October, 1988


Iowa News

LEFT—Displaying their wares at the National Bank of Waterloo exhibit were, from left: Tom McDermott, sr.v.p.; Judy DeGroote, v.p., both
with National Bank of Waterloo, and Eileen Thompson, a.v.p., Peoples T&S, Indianola. RIGHT— Visiting at the Investment Centers of
America exhibit were, left: Larry Tweed, sales rep., Bismarck, N.D., and Dean Conrad, v.p. & cash., First T&S, Remsen.

LEFT—At the Evergreen Systems, Inc. of Omaha display were, from left: Dave Stochl, v.p., Omaha; Gary Todd, exec, v.p., and Steve Bloomquist, asst, cash., both with Peoples Natl., Columbus Junction, and Lee Meyer, Omaha. RIGHT— Visiting at the Banking Careers, Ltd. ex­
hibit were, from left: (front) Jean Eden, owner, Des Moines, and Sandi Garner, Webster City, with their guests, from left: (back) Norm Skadburg, pres., and Jeff Plagge, exec, v.p., both with First State, Webster City.

the conflagrations at Hiroshima and
Nagasaki, and made his way at last
to Shanghai, China. There an
A m e r ic a n o ffic e r from Iow a
befriended him and assisted him in
gaining entrance to Grinnell College
in his home state. Dr. Stoessinger’s
ode to the value of freedom as it
abounds in America earned him a
standing ovation from the moved
Next on the agenda was A B A
President Charles Pistor, who urged
bankers to “ stay involved with pas­
sion” in the fight to get expanded
powers for banks.
Mr. Pistor also brought up the
soon-to-be-released A B A task force
report on the FSLIC problem. He
said that solving the problem will
surely require taxpayer assistance,
and also expressed that whatever
the eventual solution, it will involve
banks. “ I cannot stress enough that
this is a bank problem,” he told his
Rounding out the morning ses­
sion was Thomas W . Faranda of
Faranda & Associates, who ad­
dressed the topic “ Ten Com
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

mitments to Excellence in Growing
Your Banking Business Profitably.”
His ten recommended commitments
are to the customer; to creative
thinking; to an entrepreneur/intrepreneur environment; to effective
leadership; to consultation; to
dialogue; to culture, mission and
values; to peak performance; to
management and self development,
and to achieving excellence.
Concurrent Sessions
During Monday afternoon, con­
vention attendees were able to at­
tend two of the concurrent sessions.
“ Economic Development— Tap­
ping the State’s Resources” was
presented by a panel of experts
moderated by M yrt Levin, executive
director, Iowa Business Council,
Des Moines.
Assistance for new businesses
was discussed by Jack Bailey, direc­
tor, Iowa Area Development Group,
W est Des Moines. He gave informa­
tion on the use of tax increment
financing, the Sm all Business
Development Centers, and the Iowa
Business Growth Company.

Leonard C. Goldman, director,
ISU Research Park in Ames, gave a
presentation on research parks and
incubators. He urged banks to in­
vest in these programs in spite H
their risk because of their necessity
if Iowa is to benefit economically
from advances in research.
Bruce Gerleman, president of the
International Trade Center of Iov^l
in Des Moines, described how the
Trade Center assists the efforts of
Iowa communities and businesses to
reach markets overseas.
Jude Conway, adm inistrator
Division of Finance Authority,
Department of Economic Develop­
ment, Des Moines, shared with the
audience the work of the Bureau of
Business Assistance. The BureM
creates jobs and provides loans, loan
guarantees and grants to assist
One of the more popular concuxrent sessions was presented 1^
David Miles, managing director for
Investors Management Group, Ltd.,
Des Moines. Mr. M iles’ presenta­
tion, “ O pportunities in BankSponsored Brokerage,” encourag™

"Kirk Gross
Company gave
usthe unique
image we were
looking for."..

and w e are
very pleased
w ith the re­
sults. The
creative de­
J. Bruce Meriwether/President
sign of our
First National Bank of Dubuque
teller line
and the whole facility has given us
a bank w e're proud of."
Kirk Gross Company offers a
complete turn-key package all the
w ay from feasibility studies and site
selection through installation of all
your furnishings and bank equip­
ment. We have the full time staff of
architects and interior design spe­
cialists to create the functional envi­
ronment you are looking for.
Kirk Gross Company has built
or remodeled over 1 million square
feet of financial facilities in Iowa.
For creative solutions from start to
finish, Kirk Gross Company can
handle the project — w ith quality
all the w ay
For more information, call or
w rite The Kirk Gross Company
4015 Alexandra Drive, PO. Box
2097, Waterloo, IA 50704. Phone:
(319) 234-6641.
Federal Reserve Bank of St. Louis


Iowa News

LEFT—At the First Interstate exhibit were, from left: Jeff Sims, a.v.p., Des Moines; Kris Ausborn, v.p., Iowa T&S, Emmetsburg; Sid Jones,
exec, v.p., Home State, Jefferson, and Randy Steig, v.p., First Interstate, Des Moines. RIGHT— Displaying their information during the con­
vention were, left: Michael Hopson, v.p., Des Moines, and Douglas Austin, pres. & c.e.o., Austin Associates, Toledo, Oh.

LEFT—“ Puttin’ around” at the BIOS Banking System exhibit were, from left: Milt Hennick,, Cedar Rapids; Charles E. Walsh, v.p., F a rm e ry
& Merchants, Burlington; Randy Johnson, Cedar Rapids, and Lisa Walsh, a.v.p., also with F&M in Burlington. RIGHT— Roy Wingers, left®
talks with a banker about Bank Building Corp., St. Louis.

bankers to learn the ins and outs of
bank-sponsored brokerage and how
to generate profits.
Mr. Miles said, “ A bank-spon­
sored brokerage is a creative ap­
proach to controlling customer
assets by providing alternatives to
traditional bank products and ser­
vices within the bank itself.” He
also said that bank-sponsored
brokerage helps enhance the image
of the bank, retain customer assets
and generate fee income.
Mr. Miles said that, first of all,
the brokerage operation “ must fit
with your bank’s overall strategy
and have one hundred percent sup­
port from the top.” Secondly, a
survey should be taken to determine
the services your customers want.
Third, the bank should establish
clear objectives and define its ap­
proach as either defensive or as a
profit center.
Other concurrent sessions offered
were “ Coping W ith Change” with
consultant Dr. Charlene Bell;
“ Theories of Investment Portfolio
Management” with representatives
of James Baker and Co., Oklahoma
City; a Laser Pro demonstration by
Gary Livesay of IB IS; “ Retirement

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Benefits for Your Employees” ; and
“ A Passion for Customers” video­
tape by author Tom Peters.
On Monday night a reception was
held in the exhibit hall, after which
receptions were held in the bank lob­
bies of First Interstate Bank,
Norwest Bank and Valley Bank in
downtown Des Moines. A number of
private dinner parties followed, then
registrants were invited to the Presi­
dent’s Dance at the elegant, new
Iowa State Historical Museum
where guests could inspect the
facilities and dance to the Big Band
sound of an excellent orchestra that
played till midnight.
Tuesday A g Breakfast
The Tuesday morning A g Break­
fast session was marred by the in­
ability of the scheduled speaker to
arrive because of weather complica­
tions along his route to Des Moines.
Ambassador Clayton Yeutter, the
U.S. Trade Representative, was
rerouted by the airlines and couldn’t
be located the morning of the break­
fast. Teleconference lines were
quickly installed as a backstop, but
when it became apparent Am bassa­
dor Yeutter couldn’t be found, IB A
staff executives Neil Milner and

W es Ehrecke showed their ingenui­
ty by quickly arranging during the#
breakfast hour with several promi­
nent guests to share the platform for
an impromptu panel discussion.
They responded graciously and were
given a warm reception by the la r g #
audience. Taking part were: Lt. Gov.
Jo Anne Zimmerman; Iowa Secre­
tary of Agriculture Dale Cochran;
Iowa F m H A Director Bob Pirn, and
Robert Furleigh, A SC S state ex®
ecutive director. Moderating the
panel was Don Muhm, the wellknown and highly-respected farm
editor for many years of The Des
Moines Register.
Mr. Cochran quickly reviewed the
effects of the ag recession of recent
years. He said Iowa lost 11,000 far­
mers, 275 implement dealers (thre
per county!); 137,000 people left thi
state, and 40 banks were closed. He
added, “ Now, I have had to spend 80
percent of my time on the drought.
W e formed a Task Force of 32 to
people who have been looking a
how to help farmers get through the
worst of it. M ost of our efforts and
suggestions wound up being im­
plemented by U SD A Secretary
Lyng or being enacted into law by


Iowa News


More Pictures from
Iowa Bankers Convention


Final convention speaker Carl Pohlad (center), pres., Marquette
Bank Minneapolis, is picutred with, from left: Jock Stevenson,
©pres., First T&S, Cedar Rapids; IBA Pres. Clair Lensing; IBA Sr.
V.P. Wes Ehrecke, and Doyle Ruble, pres., Iowa State Savings,
Clinton. Mr. Pohlad is owner of the Cedar Rapids and Clinton


LEFT— Data Business Equipment was on hand to visit with bankers at the convention. Taking part were, from left: Jim Landuyt, Des
©Moines; Parker Schmitz, Des Moines; Bob Chittenden, pres., Farmers Sav., Mitchellville, and Tom Kolb, Des Moines. RIGHT— Enjoying a
shoe shine, compliments of MidAmerica Corporation were, from left: Bill Clark, acct. mgr., Financial Information Trust, Des Moines, and
Jerry Trudo, v.p., Merchants Natl., Cedar Rapids.

LEFT—Present at the First Natl., Omaha Dinner at the Wakonda Club were, from left: Gerry Tomka, v.., and his wife Rosie; Jim Grotenhuis,
Sec. State, Stanton, and his wife Kathryn, with Marty McCartney, pres., United Natl, of Iowa, Sidney, and Pat. RIGHT— Also enjoying the
evening were, from left: Pat Moehn, pres., Commercial Sav., Carroll, and his wife, Carlene; Timmy and Bill Miller, pres., Polk City Sav.;
Ginger O’Neal, host bank, and Bruce Lauritzen, pres., host bank.

LEFT—Welcoming guests to the Bankers Trust convention reception were, from left: Tom Smith, exec, v.p.; Dennis Wood, pres. & c.o.o.;
John Chrystal, chmn. & c.e.o.; John Ruan, chmn of exec, comm., and Ben Eilders, sr.v.p., all with host bank. RIGHT— Visiting with a banker
^ vas , left, Jeff Rodman, v.p., MABSCO Capital, Inc., Des Moines. Mr. Rodman presented “Farm Lending and Farmer M ac—The Secondary
Market Arrives.”
Federal Reserve Bank of St. Louis

Northwestern Banker, October, 1988


Iowa News

LEFT—Showing their wares at the Brandt Money Handling Machines, Omaha, exhibit were, from left: Rudy Carey, Herb Duysen, Dennis
Steel and Mark Grimes. RIGHT— Promoting the Graduate School of Banking in Colorado were, left: Norm Skadburg, IBA trustee and pres.,(
First State, Webster City, with Kathy Jones, Boulder, Colo.

ENJOYING First Interstate Bank of Des Moines reception were, from left to right: Bob Millen, pres, of host bank and Happy; Jim Eilers, s r .#
v.p. of First Interstate; Marilyn and Bill Beohm, pres., Tama State; Doug McDermott, pres., Home State, Jefferson, and Jan; Robert Gulling,
pres., Monroe Sav., and Chris and Randy Steig, v.p., First Interstate.

Congress. W e feel that without
these regulations and the Disaster
Relief Bill we would have lost an ad­
ditional number of farmers.”
Mr. Cochran added, “ All you have
to do is look at what happens with
ag processing companies and related
ag industries to see how important
farming is to the entire nation. I
don’t think the $3.9 billion price tag
on drought relief will help much.
W hat we need is more rain to replace
the large deficit in sub-soil moisture
throughout the state.”
Mr. Furleigh reviewed effects of
the 1985 Farm Bill, then discussed
in some details the conservation
measures being pursued, including
the cropland reserve program aimed
at putting away up to 69 million
acres of highly erodible land. “ The
initial goal,” he said, “ is 45 million
acres and we are now at 23.5 million
acres in the CR P.” Mr. Furleigh said
one of the current problems facing
his department is how to administer
the Drought Assistance Act. He
said specialists from his staff were
attending a meeting in Dallas, Tex.,
to get details about handling ap­
Lt. Gov. Zimmerman said “ we
can’t really know our losses from the
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

drought until harvest. Some farms
have had their crops wiped out,
while others in the same community
have fine crops. This creates stress
that must be dealt with in the con­
text of community reactions, in
which bankers play a great part. W e
were just thinking about phasing
out our ‘hot line’ but we have in­
formed the Extension Service we
will fund it one more year. The state
government is on hold looking at the
drought until we know the actual ef­
fects of the drought and how it af­
fects all services of state govern­
F m H A Director Bob Pirn said,
“ W e ’re making progress with the
Fm H A Disaster Program despite
the drought.” He noted that “ 40
percent of farmers in the state have
drought insurance and another 40
percent probably wish they did
have! F m H A will have a Drought
Assistance Program and we’ll come
in with and behind the A SC S pro­
gram.” Mr. Pirn also added, “ W e
will continue to prom ote the
Guaranteed Loan Program. A
number of our borrowers will be af­
fected by the restructuring regula­
tions. This means extending longer
terms, but mainly writing down

some loans.”
Moderator Don Muhm stated, “ 1 ^
think Iowa is the best kept secretw
around. I am optimistic, for agricul­
ture here is looking better and I
have confidence in its return.”
A n extended question and answer ^
period concluded the A g Breakfast.
Tuesday Concurrent Sessions
Tuesday morning bankers were
once again able to select to attend
two of the concurrent sessions o f - ^
Martha Steincamp, acting region­
al counsel for the Environmental
Protection Agency, Kansas City,
Mo., addressed the topic, “ Under q
ground W aste Disposal Liability.”
She advised bankers as to how they
can best protect themselves from
costly liability of this type.
Acts of banks which may result in #
liability include: 1. foreclosure on
polluted property; 2. taking over
management of a debtor with
polluted property; 3. obtaining the
right to have a third party m a n a g e#
the debtor; 4. installing an agent to
take over management; 5. providing
payment to other creditors of the
M s. Steincamp urged bankers t o #
be careful if a debtor uses hazardous

Two Stronger
Correspondent Banks
The National Bank
of Waterloo






Peoples Trust
and Savings Bank

The National Bank puts its financial strength
and outstanding correspondent banking
services to work for a larger num ber of
banks in Northeast Iowa.
Our state of the art com puter processing
equipm ent is designed to m eet all your
needs and is one of the largest processing
centers in the state.
Even m ore important, the experienced
m anagem ent team ca n provide advice and
banking expertise for all financial questions.
We are responsive to your needs.
You can now put our unm atched
com bination of an experienced team and
expanded services to work for all your
correspondent banking needs. Give us a
call for m ore det ai l s. . . 1-800-772-2411 or

Thomas R

Josef M. Vich
Vice President

Sr. Vice President


Now the sam e financial strength and
services in correspondent banking are
available to bankers through Peoples Trust
and Savings Bank of Indianola, an affiliate of
Iowa National Bankshares and The National
Bank of W aterloo.
We offer full services including purchase
of excess funds, bond advisory; data
processing services, autom ated accou nts
receivable billing system s and other
com plete correspondent bank services.
In Indianola, call 515-961-6241 for more
details on our expanding correspondent bank

Put our financial
strength, our financial
perform ance and our
continued financial
growth to work for
you. Call any m em ber
of our team for more

Everett R Brown

Vice President

Mike Coppess,
Vice President

Eileen Thompson
Assistant Vice



| J

¡T il
I rP


Erling Schmiesing

Wm. J. Rickert

James Freet

Dennis Thoren

Leroy C. Bell

Robert Cook

Charles E. Yagla

Executive Vice

Sr. Vice P resident

Sr. Vice President

Assistant Director

Assistant Vice

Assistant Vice

Data P rocessing
O fficer

T h e National Bank

Peoples Savings Bank

100 East Park ■Waterloo, IA 50703 ■(319) 291-5200


Federal Reserve Bank of St. Louis

FDIC Insured up to $100,000
Subsidiary of Iowa National Bankshares Corp

Iowa News


PICTURED at Security Natl, of Sioux City breakfast were, from left to right: Florence and Ray Erlandson, pres., Cherokee State; Gene

VISITING at Norwest Bank of Des Moines reception were, left to right: Skip and Kim Bright, v.p., Keokuk Savings B&T; John Nelson, chmn.
of Norwest Des Moines, and Kay; Ed and Martha Johnstone, pres., Keokuk Savings; Lynn Horak, pres., Norwest, and Charlene; Ray Erlan£
son, pres. Cherokee State, and Florence, and John Rigler, v.p., Norwest, and Cheryle.

chemicals, or produces them as a by­
product. Banks should check if land
has been previously used for such
purposes or for a landfill or waste
site, or if underground storage tanks
are present. She recommended con­
sidering an “ environmental audit’ ’
by a qualified expert. Bankers may
also seek information on real estate
or companies by contacting the
Freedom of Information Office at
the E P A in Kansas City.
A presentation on Farmer Mac
was given by Jeff Rodman, vice
president of marketing, M A B SC O
Capital, Inc., Des Moines. He began
by relating figures which indicate
higher farm operating loans are
predicted for 1989. “ Farmer M ac,”
he said, “ is a tool to help us deal
with these [increases].”
Regarding the upcoming offering
of Farmer Mac stock, Mr. Rodman
said banks must own stock to be
able to use Farmer Mac, and the
stockholders will elect the perma­
nent board, “ a very key group of
Mr. Rodman recommended that
bankers begin to to keep an eye out
for organizations such as M AB SC O
and Prudential which will become
Farmer Mac loan pool assemblers.
“ You will have a tremendous
Federal Reserve Bank of St. Louis

amount of communication with the
pool assemblers, not like with Fan­
nie M ae,” he said. A main difference
will be that pool assem blers
themselves will sell loans.
Mr. Rodman went on to relate
facts about loan pools and other
details of the new secondary market.
He closed by urging bankers to look
carefully at the stock offering. “ If
commercial banks don’t get in­
volved right now with the develop­
ment of Farmer M ac,” he said, “ this
tool will be gone.”
Dr. Douglas Austin, president of
Austin Associates, Toledo, Oh., and
his associate Mike Hopson, vice
president in charge of the recentlyopened Des Moines office, gave a
detailed discussion during the con­
current session on “ Your Board of
Directors and the Credit Review
Process.” Following an eight-page
outline distributed to the overflow
crowds in attendance at both ses­
sions, they stressed the respon­
sibilities of directors for knowing
their duties specifically in the area
of credit—before the loan is dis­
persed, while the loan is outstan­
ding, and when the loan has to be
collected or charged off. Dr. Austin
and Mr. Hopson went into detail
about the documents directors

should have from bank management
for proper review of loans, and also
added a sample board meeting agem
In her concurrent session on
“ Managing Relations with Bank
Regulators,” Attorney Mary E. Cur­
tin of Minneapolis used a detailed
outline that was distributed to an
bankers at this well-attended ses­
sion. This covered such items as for­
mal and informal enforcement ac­
tions, the C A M E L rating sy ste i^
provisions generally found in Cease
and Desist Orders and/or Written
Agreements, factors to remember in
dealing with enforcement actions,
and common misimpressions of suc^|
Also popular among attendees
was the “ Negotiating Skills for
Bankers” session presented by con­
sultant Art Pulis of Durango, C o l^
50-Year Bankers Lunch
Oliver Hansen, chairman of the
Liberty Trust & Savings Bank,
Durant, presided at the I B ^
50-Year and Past Officers Club. He
told the large crowd of veteran
bankers, “ If this group had written
the book on A g Credit from its ex­
periences, and it had been ma<%
mandatory reading for bankers, the
Northwestern Banker, October, 1988

Rob. Ron.
Louis. Shirley.
Joe. Jim.

ILeft to right: Rob
[ooksey, Marketing

(Marketing Officer;
Louis Holmes,

Marketing Represen­
tative; Shirley
IHeishman, POS/
|ec# Coordinator;
je Ehlers, Market|ing Representative
and Jim Mrazek,

First-rate credit card services - on a first-name basis.
W h en you choose D avenport
B an k ’s complete line o f credit card
services, you’ll get to know us on
a first-name basis. W e take pride
in giving the kind o f service you
e x p e c t- prom pt, personal attention
to all your goals and needs.
W e’ll keep you on a first-name
basis with your customers by
putting your b a n k ’s name on every
card and application. T h e y ’ll keep
their im portant ties to you - the
bank they’ve come to trust.

Y o u ’ll be impressed by our great
program. W e offer some o f the
lowest fees, finance charges and
m erchant pricing around. But it’s
our friendly, professional staff - and
the service they provide after the
sale - that will make you a

Call (319) 3 83-3407 for more
inform ation or to arrange to have
a representative call on you.


------------------------A N D T R U S T C O M P A N Y -----------------------
Federal Reserve Bank of St. Louis




Iowa News

LEFT— Bill Brenton (second from left), chmn. Brenton Bank, Des Moines, and Dick Jacobson (second from right, pres, of Jacobson
Wholesale and dir. of Banks of Iowa), were among guests at LaSalle Natl, of Chicago luncheon hosted by Del Rogers (left), v.p.; Nick
DeLeonardis (center), sr. v.p., and Wayne Bismarck (right), v.p. RIGHT— Northern Trust of Chicago dinner hosts included (at extreme 0 ft)
Mark Short, 2nd v.p. and Mike Kubacki (rear), v.p. & div. head, and Gigi Short, with guests Jack Rigler, pres., Central State, Muscatine, and [
June; Scott Fetner, pres., Natl. Bank of Waterloo, and Joanne; Mitzi and Nick Schrup, chmn., American T&S, Dubuque, and Dick Summerwill, pres., Iowa State B&T, Iowa City.

Farm Credit System, regulators and
Congress, we wouldn’t have had the
troubles we’ve gone through.” After
lengthy meetings by the nominating
com m ittee (of at least three
minutes), Joe Gronstal, director and
former president and chairman of
the Carroll County State Bank in
Carroll, was designated to succeed
Mr. Hansen as president of this
prestigious group for the coming
year. His duties will consist of
presiding at the 1989 convention

Closing General Session
Tuesday afternoon’s general ses­
sion opened with a presentation by
Shelburn Wilkes, Wilkes Manage­
ment Associates, Orlando, Fla., en­
titled ‘ ‘Parade of Presidents.” Mr.
Wilkes is an expert on American
presidents and amused his listeners
with an anecdotal trip from George
Washington to Ronald Reagan.
IB A Executive Vice President

Don Muhm, Des

M o in e s

R e g is te r

editor, moderated the ag panel.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis


and CEO Neil Milner next addressed
the convention. He lamented bank­
ing legislation currently before Con­
gress, saying banks have ‘ ‘no good
options in W ashington.” He also
called for unity in the banking in­
dustry, stressing that unity exists
on all the important issues. He
urged bankers to be persistent in
contacting their legislators, saying,
‘‘W e do have a lot of friends in the
legislature, on both the state and na­
tional levels, and we need to not be
timid in telling them what we
Alan Tubbs, president and CEO
of First Central State Bank,
DeW itt, relayed highlights of the
A B A ’s FSLIC Oversight Commit­
tee Report. He told bankers that the
solution to the FSLIC problem is
not simple recapitalization, but will
require insurance reform. He agreed
with Charles Pistor’s earlier com­
ments that the banking industry
will be involved in the resolution of
this problem.
O. Jay Tomson, chairman and
CEO of Citizens National Bank,
Charles City, shared his reflections
on the matter of the FSLIC. He said,
“ The desire to clean up this mess
does not exist to an equal degree
among all the players. Those of us
with a strong interest in the out­
come must stand watch . . . W e
should not stand ready to inherit
something that is less than accep­
Mr. Tomson set forth five ac­
complishments toward which he
feels the banking industry must
work: 1. equal capital requirements
for all players; 2. equal accounting
practices for all players; 3. equal
regulation for all players; 4. equal
taxation for all players; 5. a com­

plete re-examination of deposit in­
The afternoon session closed with I
keynote speaker Carl R. Pohlad,
president of Marquette Bank Min-1
neapolis. Mr. Pohlad opened withl
reminiscences of his youth in \Mist[
Des Moines, and went on to share!
the principles which have brought [
him success in banking.
“ D on’t get fancy with your bank­
ing services,” he said. “ You hav^tol
get to the people. Banking is a I
people—people—people business. ”
He related his commitment to visit!
personally with customers dailw atj
the bank and exhorted his audie®e,[
“ Know your customers . . . you say,I
‘I know, I know!’ but you don’t do|
it !”
Mr. Pohlad described his bank sl
position, ranked third in the Twin!
Cities, as one which requires not be-1
ing all things to all people. “ W ej
defined our market niche and try to|
reach it—and work at it,” he said.

Bob Pirn (left), FmHA Iowa st. dir., was
awarded a plaque at the Ag Breakfast for
distinguished service by Chuck Souder
(center), retiring Ag Comm. chmn. and v.p.,
1st Sec. B&T, Charles City, and Jeff Plagge,
new Ag Comm., chmn. and exec. v.p .,#st
State, Webster City.

Flexibility is what
makes our credit
insurance program
stand above
the rest!
Credit Life and Disability insurance through Iowa Bankers insurance &
Services, Inc. offers you the flexibility you need to tailor your coverage to
your customers' specific needs. For instance, we give you the choice of a
comprehensive blanket program for open-end home equity loans or single
premium program for closed-end loans. In addition, programs are also
available for ag/business and mortgage loans as well as collateral
protection (L.S.l.) coverage. When it comes to insurance, IBIS can give you
the professional training you and your staff need to
increase your bottom line.
Call Cary Livesay or Ron Meyer at IBIS today 1-800-532-1423, or return the
coupon below fo r more information.





I w a n t ta iio r-m a d e cov erage!

P lease c o n ta c t m e re g a rd in g :
C re d ito r P ro te c tio n

____ L e n d e r s S i n g l e i n t e r e s t

____ A n n u a l R e n e w a b l e T e r m


_____M o r t g a g e L i f e / D i s a b i l i t y


l a m a l s o i n t e r e s t e d in:



P ro p e rty /C a s u a lty


G ro u p L ife /D is a b ility
in c o m e /A n n u itie s



■ w

____ C r o u p H e a l t h /
D e n ta l/V is io n
____O t h e r

T itle



C itv



R e t u r n t o : I o w a B a n k e r s i n s u r a n c e & S e r v i c e s , I n c .,
300 L ib e rty B u ild in g , Des M o in e s , Io w a 50308

Iowa Bankers Insurance & Services, Inc.



Owned by all banks in Iowa fo r the benefit of Iowa banks.
An affiliate o f the Iowa Bankers Association
Federal Reserve Bank of St. Louis


Iowa News

LEFT— Hosts at FirsTier Bank of Omaha luncheon included, from left: Gene Noell, v.p.; Dick Yeshnowski, v.p.; John Wear, a.v.p.; Joan lr
gram, Inv. off., and John Clements, v.p. RIGHT— Scott Fetner (center), pres., Natl. Bank of Waterloo, visits with Bob Jamerson (le f£ ai
chitect, and Bob Buckley (right), pres., of Kirk Gross Co., Waterloo.

AWAITING the crowd arrival for the Sunday evening “Court Avenue Experience” were, from left: Mike Hopson, v.p., Austin Associates, De
Moines, with Sharon Sievers; John Sorensen, v.p.; Wes Ehrecke, sr. v.p., and Barb Lowe, convention coord., all with IBA. RIGHT— Othe
IBA staff members take a well-deserved break between sessions at the convention center.

But most important, he empha­
sized, are the fundamental skills of
banking. Mr. Pohlad told his au­
dience the key to success is to train
your people in the basic skills they
need, and retrain them often. His
maxim: “ Teach your employees the
fundamentals over and over.”

Inaugural Dinner and Show
The Inaugural Dinner and Show
Tuesday evening at the Marriott
Hotel was an elegant affair. John K.
Hanson, chairman of Manufacturers
Bank & Trust in Forest City, and his
wife, Louise, provided beautiful
flowers for each of the several hun­
dred ladies in attendance.
Retiring President Clair J. Lensing presided at the dinner to install
the new officers. Incoming Presi­
dent Don Snyder presented a gift to
Clair and his wife, Mary, from the
IB A —a beautifully framed litho of a
Maynard Reese wildfowl painting.
Mr. Snyder stressed three areas of
strategic concern to the members of
the IB A . First, he said, “ we all need
to be involved in planning, especial­
ly in our legislative efforts. A s
bankers, we have no choice but to be
Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

involved to make our voices and our
opinions heard. Second, we must
pursue strongly our programs of
education and training. Third,
membership products and services
is an area that will be reviewed often
to make sure we are meeting the
timely needs of member banks.
Last, we will continue studying the
association structure to make sure it
maximizes your investment with
IB A .”
Mr. Snyder began his brief pre­
pared remarks with this Irish toast:
“ M ay you have the hindsight to
know where you’ve been, the fore­
sight to know where you’re going,
and the insight to know when you’re
going too far.”
After reviewing briefly the ac­
complishments of the IB A in its
first 100 years, he stated, “ Our hind­
sight is good. Our foresight is our
strategic plan which is reviewed an­
nually and will be updated. This
calls for several special efforts.”
Referring to insight, Mr. Snyder
said, “ I t ’s possible to go too far.
This is a world of tradeoffs, com­
promises, and, sometimes, injus­
tices. If you think the IB A leader­

ship is going too far, tell u s .% o
should also recognize that makin
no decision at all is improper. I firn
ly believe you and I have a stron
obligation to use the best of our^bi
ities in making your associatiornoei
ter to serve you and our bankers.” [

Promoted in Sibley
Harris J. Kruse has been ^rc
moted to executive vice president o
the Sibley State Bank. He has bee
with the bank for eleven years, firs
as a trainee, then as assistant^ic
president, and most recently as vie
president and cashier.
Mr. Kruse succeeds Michael Mu
lendorf, who is now serving as pres
dent of Washington County % n lfl
Blair, Neb.

Promoted in Osceola
A t Clarke County State % m l
Diane Ogbourne has been promote
to personal banking officer an
marketing director. She has bee
with the bank for ten years and ha
been a customer service repose
tative for the past eight years.

Io w a N e w s


IBIS Celebrates 10th Anniversary

CELEBRATING the Ten Year Anniversary of Iowa Bankers Benefit Plan last month in Des Moines were, from left: Juanita Fulster, a.v.p.;
Frank Gleeson, pres.; Chris Wehde, a.v.p.; Martha Faring, group claims, all with IBIS, Inc., Des Moines; Neil Milner, exec, v.p., IBA, and
Sylvia Richards, billing processing, IBIS, Inc. Also enjoying the reception were from left: Larry Gille, v.p.; Jim Jensen, v.p.; Merritt Krause,
v.p., all with IBIS, Inc., and Wes Ehrecke, sr. v.p., IBA, Des Moines.

|IT<$ Bill Payer Introduced
Dale Dooley, president of ITS,
ic., and other staff members were
Iow a C ity
recently to demmWtrate S H A 'A M Bill Payer,
new service.
)ver one thousaml University
Fiowa students
ive signed up
the program,
/hich will enaD. DOOLEY
jle^them to pay
lr education bills with their A T M
:ards. This is the first time such a
irvice has been offered in the
inited States.
É t first, Bill Payer will be
ricted to A T M s and similar terlinals at supermarkets, retail
’enters and financial institutions.
le program will be expanded over
Din^, as utilities companies and
Dtners who bill regularly are signed
ip with the service. Eventually
Ispecial Bill Payer terminals will be
¡installed as well.

Conrad, Melbourne Banks
|Announce Merger
James J. Molloy, president and
of the First State Bank, Conoy, has announced that the merger
f the Melbourne Savings Bank into
the First State Bank was completed
n September 1. Melbourne will be
jpatated as a full-service office and
ill be managed by Ron Kemmerer,
Federal Reserve Bank of St. Louis

vice president.
Ken Michels was recently added
to the Melbourne staff as assistant
vice president and ag loan officer.
Daryl Stalzer will continue as
manager of the S & M Insurance
Agency in the Melbourne office.
The merger brings the total assets
of First State Bank to $37.5 million.

W aterloo Banker Graduates
From Boulder School
John W . Rathjen, vice president

at Peoples Bank and Trust Com­
pany of Water­
loo, has com ­
pleted the final
y ea r
Graduate School
of Banking, held
at the Univer­
sity of Colorado,
Boulder. He was
am ong
m ore
than 460 stu­
dents attending
the 38th session of the school.

To compete,
be complete!
A total financial services
delivery system is coming
soon from

Northwestern Banker, October, 1988


Io w a N ew s

Libertyville Bank Remodels

associate administrator for manage­
ment assistance in S B A ’s Centra’
Office in Washington, D.C. Mr.
Thomson joined S B A in 1982.

Elected in Muscatine

CONSTRUCTION has begun on a major remodeling project for Libertyville Savings Bank,
according to President Robert Stump. An addition to the west side of the bank will double
the size of the building. The expansion will give the bank four private offices, a conference
room, a serpentine teller line with six teller openings, and a sit-down station, with addi­
tional vault storage space in the basement, an expanded waiting area, and expanded park­
ing facilities. Office Concepts, Ltd., specialist in the design and development of financial
institutions, is in charge of the turnkey project. It should be completed by the end of the
year, according to Office Concepts Vice President Ross Schoonover.

Named SBA Director for
Cedar Rapids District
James N. Thomson has been
named district director of the U.S.
Small Business Administration’s
Cedar Rapids office, effective Oc­
tober 10. He is responsible for
S B A ’s finance and investment,
business development, procurement
assistance, minority small business
and advocacy outreach.

In this position, he will supervise
18 employees and SB A activities in
Eastern Iowa. He had been regional
administrator for Region V in
Chicago and responsible for Illinois,
Indiana, Michigan, Minnesota, Ohio
and Wisconsin for two years.
Immediately prior to becoming
reginal administrator, he was the
district director of the Minneapolis
office. He also has served as branch
manager in Springfield, 111., and as

Committed to
making your
bank stand
apart from the

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

Richard J. Pilcher has been elec­
ted senior vice president/senior trust
officer of the
First N ational
Bank of Musca­
tine. For the
past five years,
he has been the
senior trust of­
fic e r
th e
F a rm e rs
Merchants Bank
and T ru st in
Burlington. Pri­
or to that time, he was in private Ww
practice in Grundy Center.

D.M. Lamb Dies
D .M . Lamb, director of the City
State Bank of Madrid, died o # a
heart ailment on
August 22. He
was 64. He re­
tired from the
bank as vice
p resid en t and
c a s h ie r
D ecem ber 31,
1987, after spen­
ding his entire
banking career
of 41 years with
the City State Bank.
Mr. Lamb was raised in Boone
and graduated from Boone H * h
School in 1942. He then attended
Coe College, Cedar Rapids. During
World War II, he served as a lieute­
nant in the U.S. Army.
Mr. Lamb joined City State BÊmk
in 1946 as a bookkeeper. He was pro­
moted to assistant cashier in 1948
and to cashier in 1957. He was a
director since 1960 and vice presi­
dent since 1965.
In 1957-58 Mr. Lamb served as
president of the Des Moines Chapter
of the National Association of Bank
Auditors and Controllers (now ^ie
Bank Administration Institute). Tie
was active in numerous civic and
church organizations.
Surviving are his wife, Gloria; his
daughter, Sandy, and his son, S t ^ e .
Sandy is customer support officer of
F ir s t I n te r s t a t e In fo rm a tio n
Systems of Iowa, Inc., Des Moines.
Steve is senior examiner in the A t­
lantic Field Office of the Iowa D^yision of Banking.

Iow a N e w s



Davenport Bank & Trust Hosts Reception and Dinner

400 BANKERS and guests from Iowa and Illinois were in attendance last month for the Davenport Bank & Trust Co. correspondent recep­
tion and dinner. This annual event was held at the Black Hawk Hotel in Davenport, with a reception followed by dinner and dancing. Enjoy­
ing the evening were, from left: John Benner, chmn. & pres., and Marilyn Evans, v.p., Bradford Banking Co., with Judy and Michael Bauer,
1st v.p., host bank. Also present were, from left: Martha and Edward Johnstone, II, pres., Keokuk Svgs. B&T Co.; Colleen and Gerry
Huiskamp, chmn. & pres., Blackhawk State, Milan, III., and James Figge, off. of pres., host bank, with his wife, Sandra.

IBA Consum er Services Conference
To Be Held O ctober 18-19
H E Iowa Bankers Association
will present “ Consumer Bankers
Know the Score,“ the 1988 Conler Services Conference, on Oc>er 18 and 19. It will be held at the
Marriott Hotel in Des Moines.
Featured speakers at the con­
ference will be Dennis and Niki M e­
ntion of McCuistion & Associates, Irving, Tex. Also appearing
will be Dr. Willie Staats, professor
of banking and finance, Louisiana
State University, Baton Rouge;
Flynn, Des Moines attorney,
and Randy Mascorella, assistant
women’s basketball coach at Iowa
State University.
A special “ tailgate party” for parti^pants will be sponsored by Iowa
Bankers Insurance & Services.
The complete agenda follows:


Tuesday, October 18
% :00 Registration.
9:00 Welcome and introductions:
Nancy Dunkel, IB A consu­
mer service committee chair
and vice president and
senior loan officer, Farley
State Bank.
9:15 “ Game Plan for the ’9 0 s” —
Dennis McCuistion.
H):45 “ Tackling the Com peti®
tion” — Dennis McCuistion.

of Market Driven” — Niki
“ They’re Number O ne!” pre­
sentation on customer ser­
vice—Niki McCuistion.
2:45 Concurrent sessions:
“ Variable Rate Lending” —
Dennis McCuistion.
“ Preparing for the Compli­
ance E xam ” — speaker to be
“ Making Sales Calls/Incentives” — Niki McCuistion.
4:00 Concurrent sessions repeat.

5:00 Tailgate party sponsored by

Wednesday, October 19
8:00 Continental breakfast.
9:00 “ Negotiating Skills” — Dr.
Willie Staats.
11:00 “ Lender Liability—Calling
the Right Signals” —Tom

12:00 Luncheon— “ You Can Be A
W in n er” — Randy M a sco ­
1:30 “ W ays to W in ’Em Over” —
Dr. Willie Staats.
3:00 Adjournment.

Austin P. Lawler & Associates, Inc.

Thinking about cost reduction?
Our firm makes the difference.
We d on ’t just make recommendations, we work with your people to im­
plement positive solutions.
Your own staff can tell you what the problems are. But do they have the
expertise to provide you with solutions? W e’ve proven that we can, in a
wide variety of banks.
Our preliminary analysis is designed to let us show you specifically how our
services can be put to use to provide benefits to your bank.
For a list of references or more information call 312-584-5757.

12:00 Luncheon; presentation on
I B A ’s annual Consumer
Credit School.
1:30 “ Customer Service/Concept
Federal Reserve Bank of St. Louis

Austin P. Lawler & A ssociates, Inc.
40W 274 Winchester Way
St. Charles, IL 60175
Northwestern Banker, October, 1988


Io w a N e w s

IBIS Annual Golf Outing Held

IOWA Bankers Insurance & Services, Inc. held its Eighth Annual Golf Stag last month in various locations across the state. IBIS, in con­
junction with The Credit Life Insurance Company of Springfield, III., sponsored the event in three Iowa cities: Cedar Falls, Ottumwa and
Carroll. Execellent participation and good weather marked this year’s event.
Pictured above at the Beaver Hills Country Club in Cedar Falls are, from left: John Stull, v.p., Lincoln Svgs., Reinbeck; Lynn Bonjour, v.p.,
Home Tr. & Svgs., Osage, and John Hudson, a.v.p., The First Natl., Waverly. Also pictured, from left, are: Charles Yagla, data proc. off.,
Natl. Bank of Waterloo; Gary Livesay, v.p., IBIS, Inc.; Bob Beilis, v.p., Fairbank St., and Jack Hawks,, v.p., The Credit Life Co.

Changes Told in Farley
The following promotions and
staff changes have been announced
by the Farley State Bank:
Nolan L. Ford has been promoted
to assistant ag loan officer. He has
been with the bank since February,
and prior to that worked for a year
and a half with the Farm Credit Ser­
vices in Webster City and Nevada.

t ]et a Second

Kenneth J. McDermott has joined
the bank in the teller and operations
department. He is a recent graduate
of Cornell College in Mount Vernon.


Sioux City Bankers Complete
Graduate School of Banking
Debbie D. Smith, assistant v i #
president, and Ronald A. Jorgensen,
controller, of First National Bank in
Sioux City, have completed their
final year of the three-year Graduate
School of Banking, Boulder, Colo.#


M a k e s u r e the a d v ic e fo r


y o u is the b est a p p r o a c h

Both bankers won honors for high
exam scores. In addition, IV#.
Jorgensen was a member of the win­
ning bank simulation team.

(to b u ild o r r e m o d e l) .
C o n s u lt w ith a p e r so n
w ho has


years o f

b a n k b u ild in g e x p e rie n c e
p e r s o n a lly (free
fo r the a s k i n g ) .

C o n ta c t:



Patricia J. Trumm has been pro­
moted into the installment loan de­
partment. She will also be in charge
of student loans.
Nancy J. Schmitt, who works at
the bank’s Holy Cross facility, has
been promoted to manager there.

Elected in Eldora

1 :7 . Xooker Associates

Box 7266 PH.1-712-262-1499

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis


Jim Brown has been named presi­
dent and acting chairman of the
board of Hardin County Savings
Bank. He succeeds his late father,
Robert R. Brown, in both positions.
Jim Brown joined the bank in
1974 and has spent the last six years
serving as executive vice president.

Promoted in Dubuque
Robert D. Anderson, Jr. has been
promoted to assistant vice presi­
dent, marketing
D ubuque
Bank and Trust
C om pany. He
joined the bank
in 1987. Prior to
that, he was em­
ployed at Lange
Insurance Co.,
In c. as sales
m an a g er. H is
background in- R- ANDERSON, JR.
eludes eight years in insurance sajps
and management.


^Prom oted in Burlington
C.H. Walsh, president of Farmers
& Merchants Bank & Trust, has an­
nounced promotions and re-assign­
ments in officer personnel.
Leonard W . Lane, formerly vice
president and comptroller, has been
elected vice president and trust of­
William A . Kuehn, vice president
•and farm representative, has been
promoted to vice president and
senior loan officer, and will continue
his responsibilities as head of the
farm department.
Russell E. Larson, assistant vice
president, has been transferred to
the commercial loan and real estate
loan departments, having previous­
ly served as commercial loan officer.

ASPA Plans Iowa Conference
The second annual State Con­
ference of the American Society for
P ersonn el Administration will be
held at the Marriott Hotel in Des
Moines on November 9 and 10.
General session presenters in­
c lu d e Thomas G. Kelley, vice
"r e s id e n t—human resources at the
Benjamin Franklin Savings and
Loan Association of Portland, Ore.;
Gwen L. Stern, Midwest regional
^irector for the W yatt Company;
ueff Hallett, president of TRAC ,
Inc.; and Dr. L. Robert Keck, presi­
dent of Boulder Graduate School.
For more information, contact
^ h a r o n Ward, ASP A /Iow a ’88, c/o
Holmes Murphy, 420 Keo W ay, Des
Moines, IA 50309.

A p p o in te d in Ankeny
John “ Swede” Lundstrom has
been appointed to the board of direc­
tors of Hawkeye-Ankeny Bank &
Trust. He is manager of Iowa Real­
t y ’s Ankeny office. He served for
eight years as an Ankeny City Coun­
cilman, and currently serves as first
vice president and president-elect of
the Ankeny Chamber of Commerce.

There js^ a Difference
in Banks
Trust, confidence, loyalty . . . w ords our custom ers
use to describe how they feel toward Valley
National Bank.
Valley Bank is experiencing substantial grow th
. .. in deposits,
...loa n s, and
. .. in earnings.
That’s because w e maintain a highly skilled staff,
offer top service, and perform well financially.
We w elcom e your inquiry . . .
Rem em ber, there is a difference in banks.

Retired in Wyoming
Lucile J. Von Sprecken has
retired from Citizens State Bank,
|Wyoming, after 30 years of service,
she held the offices of vice president
and cashier at the time of her retire­
Geraldine F. Levsen has been pro­
m o te d to vice president and cashier
of the bank.
Federal Reserve Bank of St. Louis

Valley National Bank m
Main Office-Sixth and Walnut

M em ber FDIC


For Professional Correspondent Service
call 1-800-622-7262

Northwestern Banker, October, 1988

you have my heartfelt gratitude. M y
only request is that you give Paul*
and his associates the same oppor­
tunity to know you and serve you
with a high quality magazine.
M y last grateful acknowledgment
goes to my wife, Peggy, my partner
for 45 years next February 26. She
has given purpose to my work,
sound counsel at critical times, and
guidance to our three sons and two
daughters when my work was de­
manding. I know that it was because
of her that we have the gift of so
many personal friendships among
you. She has truly been a partner (
and she joins me in this wish that
our paths may cross often in the fu­
ture. Vaya con Dios!
Ben Haller, Jr.

Hunter R. Rawlings III, president
of the University of Iowa, has been
elected to the board of directors of
Norwest Bank Des Moines, N .A . He
became the 17th president of the
University on August 1, succeeding
James O. Freedman.
* * *

John F. Ambroson was recently
elected first vice president at W est

(Continued from page 9)
This October issue you are
reading will be the last one under the
name of the N o r th w e ste r n B a n k ­
e r . Our sale contract was effective
as of October 1, 1988, but I will con­
tinue publishing the N o r th w e ste r n
B a n k e r Weekly Newsletter through
the month of October for Paul. That
last issue will be mailed October 28.
That will be exactly 43 years from
the time I started work here on Oc­
tober 29, 1945. I have been asked by
Paul to continue writing a monthly
feature article or editorial for at
least the coming year, which I plan
to do.


It is natural, I suppose, at a time
like this, to reflect on the many
events of one’s career; however, such
thoughts on 43 years in this dyna­
mic, changing business would fill a
book. The over-riding memory I can
carry with me always is one of the so
many good and capable people we’ve
known in the banking industry.

Northwestern Banker, October, 1988
Federal Reserve Bank of St. Louis

D es
M o in e s
S t a te
B ank,
W est
D es
Moines, by its
board of direc­
tors. Mr. A m ­
b ro so n p r e v i­
ously served as a
se c o n d
v ic e
p r e s id e n t
commercial len­
ding at Norwest
Bank Des Moines, N .A .

These include ones who manage
small banks exceedingly well, and
others who manage large banks ex­
ceedingly well—the size made no dif­
ference; it was the high quality of in­
dividuals that stands out. From
these, my wife and I have been
greatly blessed with many cherished
friendships which will stay with us
The riches of this world may elude
me, but I am wealthy in the know­
ledge that so many friends like you
share the same lofty goals of con­
duct espoused in the “ Credo” of my
Alma Mater, Creighton University
in Omaha. That Credo begins with
“ W e believe in G od,” continues
through several short statements re­
lating to the dignity and responsibiities of each person, then concludes
with this statement: “ W e believe,
briefly, in the teachings of Christ,
who held that morality must regu­
late the personal, family, economic,
political and international life of
men if civilization is to endure.”
For your friendship and your
loyal readership these past 43 years,


(Continued from page 38)
was with the Chicago Fed for 41 ^



Marie A. Fotino has been named
assistant vice president of financial®
services at Avenue Bank of Oak
Park. She joined the bank in 1971 as
a teller. She has held a variety of
positions, including financial service
officer, which she has held since®

October, 1988
American Express Travelers Checks................................. 71
Bank Building Corporation................................................. 23
Bankers Trust Co., Des Moines ......................................... 50
BICS Banking System ................................................................ 11£
Computers Transportation Services, Ltd............................12
Davenport Bank &Trust Co.................................................. 61
First Bank System, Minneapolis................................... 36-37
FirsTier Bank Omaha/Lincoln....................................... 48-49
First National Bank, O m aha............................................... 45
Graduate School of Banking, M adison................................... 31£
Gross, Kirk Co., W aterloo................................................... 55
IAC G roup..............................................................................10
IBA Securities........................................................................65
Investment Centers of America, Inc................................... 4
Iowa Bankers Insurance & Services, Inc.............................63
Kooker, Earl F. Associates................................................. 68
LaSalle National Bank, Chicago ....................................... 7 ®
Lawler, Austin P. & Associates, Inc.....................................67
Marquette Bank Minneapolis ....................................... 3,32
Merchants National Bank, Cedar R ap id s ........................ 2
Midwest Management Consultants, Omaha .................. 8
Modern Banking Systems, Inc............................................. 21
National Bank of Commerce, Lincoln..................................... 42a
National Bank of W aterloo................................................ 5 9 ™
North Central Life Co., St. Paul............................................13
Norwest Corporation, Minneapolis................................... 72
Norwest Bank M innesota................................................... 35
Norwest Bank W isconsin................................................... 39
Office Concepts, Ltd., Waterloo......................................... 66
United Missouri Bank, Kansas C ity .......................... * . . . 1 4 £
Valley National Bank, Des Moines..................................... 69

---------------- F 2 nd In A Series From American Express 1----------------


100 %

20 %
10 %




I n a recent nationwide study of merchants who accept travelers cheques, 97 % of those surveyed said they accept
American Express Travelers Cheques versus only 78% for Visa-logo cheques (Source: L.R.S. Research, June 1988).
This significant advantage is one reason American Express Travelers Cheque sales have skyrocketed by more than
$4.6 billion from 1983 to 1987, while Visa-logo cheque sales have declined by $188 million (Source: Visa annual
reports). So if you’re selling Visa-logo cheques and yoursales haven’t lived uptoyour
expectations, why not switch to the Cheques that have unparalleled sales year after
year. American Express Travelers Cheques. If you’d like more information on howto
increase your sales, call Lou Eilerat 1-800-221-7282.


* Visa-logo travelers cheques are actually issued by Citicorp, Barclays Bank and BankAmerica.
Federal Reserve Bank of St. Louis



That’s BankTIES (Terminal Information
and Entry Services), the cash management
tool that Norwest has created. PC-based.
In-house. With early and smart in mind.
Early, as in 6 a.m. (Central time). That’s
when current, complete and precise balance
and transaction information is at your finger­
tips each business day.
Smart, as in better cash management
through timely BankTIES™ access to Quotes
Rate Reporting Service, and the ability to
make “early-smart” moves like wire transfers
and ACH transactions. And immediate con­
firmation through BankTIES™ Stop Payment,
© 1988 Norwest Banks Members FDIC
Federal Reserve Bank of St. Louis

a totally integrated, on-line, real-time stop
payment service.
Norwest’s complete in-house operation
is the key. To short-cut third party vendors.
To deliver simpler, quicker, better, cheaper
and more secure reports. Customized reports,
if you like.
Ask about BankTIES™ And about Norwest’s
other cash management systems that can help
make your people smarter. Sooner.