The full text on this page is automatically extracted from the file linked above and may contain errors and inconsistencies.
September 23, 1989 • The Journal of Banking and Finance Since ¡894 • Vot. 174, No. 38 V iew point: Bankers need their ow n bill o f rights ^ I Nebraska Bankers A ssociation group m eetings coverage • A g conference in L incoln • Iow a Bankers golf outing • LaSalle’s strategy w ith Exchange https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis “Our Investment Center has added good numbers to our bottom line.” “Overall we have been very satisfied with our Investment Center and it has added good numbers to our bottom line. ” That’s how Dale J. Torpey, CEO of Washington State Bank in Washington, Iowa, sums up his experience with the bank’s Investment Center which opened on January 1, 1988. When other banking friends found out about investment counselorJohn Bertsch Torpey’s intention to open an Investment discusses an investment with one of Center, most of them asked: “Aren t you his clients. afraid the Center will siphon deposits from the bank?” Torpey looked at it differently. He viewed the Investment Center as an opportunity, not a liability. He figured “this was our chance to compete on a level playing field with all of our other competitors.” And his decision proved to be correct. Bank deposits rose 9 percent in 1988, with some of the deposits coming into the bank directly from the Investment Center. Torpey particularly likes his arrangement with Invest ment Centers of America. “They rent space from us and they are a contracted service which limits our liability — that’s a big plus for us. In addition, customers using the services of the Investment Center sign an agreement absolving the bank of any respon sibility for their investments. That’s important to us, too.” Research proves that 60 percent of your customers would prefer to consolidate their financial affairs at one bank. So why wait? Take the advice of Dale Torpey and contact us today! F o r m o re in fo rm a tio n on e sta b lis h in g an In v e stm e n t C e n te r in y o u r b an k, c a ll o r w rite to d a y ! iiiiiiiiiliiINVESTMENT 111!CENTERS. Investm ent C enters of A m erica, Inc. First D akota Building • 212 N orth 4th St. • B ism arck, N D 58501 TOLL-FREE: 1-800-544-7113 (In N o rth D a k o ta : 1 -8 0 0 -7 3 2 -2 3 6 3 ) https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Marquette Family Album Minute by minute, we monitor the heartbeat of the m arketplace Bob Kern, Rob Pope, Todd Kennedy and Tom Lankton all know that up-to-the-m inute knowledge of the marketplace is crucial to the servicing of investment portfolios... of any size. These four m en are on our Investment Services Division sales team. They each have their own territory ..and their customers include banks, high net worth individuals, corporations and institutional investors. Managing these portfolios is an enormous responsibility and can only be accomplished by combining knowledge of the marketplace with an excellent trading departm ent and the kind of commitment to service these individuals all share. To leam more, just call Bob, Rob, Todd or Tom. MN WATS 1-800-642-7582. National WATS 1-800-328-8013. IN V E S TM E N T SER VICES DIVISION A Marquette Bank Minneapolis Member F[ The Best News In Banking. Sixth and M arquette M inneapolis, M N 5 5 4 8 0 Bob Kern M y territory includes Iowa and Illinois. lodd Kennedy I call on customers all over Minnesota. Tom Lankton My customers are all in the Twin Cities Area. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Ta b l e ~y of Co n t e n t s September 23,1989 • The Journal of Banking and Finance Since 1894 ‘174, No. 38 N o r th w ester n FINANCIAL REVIEW Formerly published as CO M M ERCIAL WEST, M ICH IGAN INVESTOR and NORTHW ESTERN BANKER FEATURES_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 10 Paying Your Directors By Bob Sellers Consider for a m om ent your board of directors. W hat’s in it for them? If you haven’t reviewed your means of compensating them lately, Bob Sellers makes a convincing argum ent to do so. In an increasingly demanding and complex banking world, attractive compensation plans are the b est way to retain top-flight directors. Viewpoint By Rod Roath When it became apparent that taxpayers needed support in dealing with the powerful Internal Revenue Service, Congress passed the Taxpayer’s Bill of Rights. The nation’s bankers, Roath argues, need a similar bill of rights to balance the sides in their conflicts with regulators. 16 Snapshot By Jody Olson 38 Poet Carl Sandburg lived in Galesburg, 111., for many years. If you ever pass through, visit his museum and home. Then go to the Eagle grocery store on H enderson S treet. T here you’ll find not only canteloupe and ice cream, but the friendly staff of Farm ers & Mechanics Bank. T h ey ’ve opened a full-service facility there, betw een the beer and the deli.________ DEPARTMENTS STATE REVIEWS From the Editor Illinois 20 21 Headline News 6 8 Iowa 24 Classified Ads 35 Minnesota 28 Business Marketplace 36 Nebraska 30 Wisconsin 34 Michigan NORTHWESTERN FINANCIAL REVIEW (ISSN 1042-1254) is published 51 times per year on consecutive Saturdays commencing the first Saturday in January and ending the third Saturday in December (24 issues of a magazine published twice a month, and 27 issues of a new sletter published all other Saturdays) by Financial Communications Inc., 2850 Metro Drive, Suite 704, Bloomington, Minnesota 55425. Telephone (612) 854-2177. Circulation audited by Audit Bureau of Circulation. Second class postage paid at Minneapolis, Minnesota 55401, and additional mailing office. Postmaster: Send address changes to N orthwestern Financial Review, 2850 M etro Drive, Suite 704, Bloomington, Minnesota 55425. Subscription Rates: United States, 1 yr. $57.00; Canada, 1 yr. $62.00; Foreign, 1 yr. $67.00, single copies $3.00. Absolutely no refunds for early subscription cancellation. NORTHWESTERN FINANCIAL REVIEW does not assume responsibility for the writings or statem ents of others not directly connected with this publication. Reprints available from Financial Communications Inc., 2850 M etro Drive, Suite 704, Bloomington, Minnesota 55425; (612) 854-2177. 4 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis David Takes On Goliath American Takes On the "Giant” Check Processor When David took one, well-aimed shot with his slingshot he destroyed the myth of Goliath’s power and proved the real strength of his skill. Like David, we would like to destroy the myths that the “Goliath” of the check processing world is better able to handle your check processing needs and a more cost-effective processor. Just compare Americans service and pricing on these points: American Forward Return Item Availability: Twin Cities Mixed Items: Pricing, Availability & Sorting Requirements: All items 1 Day. $.014 per item. Straightforward & simplified. “Goliath” __ Varies by type of item. $.017 per item. Complicated with hidden charges. Give us a shot. Call our Correspondent Banking Department at (612) 298-6331, and well prepare an analysis of our services, availability, and pricing compared to that of “Goliath” or your current check processor. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis A ME R I C A N N A T I O N A L B A N K • S A I N T P A U L St a f f F r o m T h e E d it o r KEEPING PARENTS PRODUCTIVE PUBLISHER EMERITUS Ben Haller Jr. PUBLISHER Paul Blackburn EDITOR Jennifer Driscoll ASSOCIATE EDITOR Jody Olson hild care is fast becoming the compensation issue of the 1990s. The changing demographics of our nation’s work force are beginning to make child care a serious concern of all employers. The number of dual income families more than doubled in the past 10 years, according to the Census Bureau. In addition, more than half of the children under age six have mothers in the work force, according to the Bureau of Labor Statistics. That figure topples 60 percent for children aged 6 to 18. These trends mean fewer parents at home to take care of the children - and more employees worried about child care while they’re at work. The financial services industry feels the problem more than most. Seventy-percent of its work force are women, and 45 percent of its managers are women. When those employees begin spending work hours to find a new child care provider, taking time off work to care for a sick child, or quitting because costs of daycare make returning to work after childbirth uneconomical, that affects the bank’s bottom line. A recent study by the National Association of Bank Women, a leader in promoting child care programs at financial institutions, concluded that parents spend up to 12.5 percent of the work week dealing with child care concerns. Clearly, not keeping parents productive is costing banks. This issue isn’t, of course, a “ women’s issue.’’ In dual-income families, for example, couples frequently take turns caring for sick children or arranging for child care. Often, the parent with the most flexible schedule attends to the child’s needs. And single parents of either sex often have difficulty solving child care issues without letting it affect work. Yet, when NABW recently asked its members about employer-provided child care benefits, it found 74 percent offered none. Ignoring the problem costs banks, especially regarding parents of newborns. Banks tight-fisted with parental leaves might want to take another look at their figures. According to Savings Institutions magazine, it is more cost effective for a company to offer a three- to six-month parental leave than it is to train a new employee. In addition, new mothers often are replaced by female employees who are equally likely to become pregnant. Two main obstacles to employer child care programs are cost and liability insurance. Several banks, however, have found creative, affordable ways to meet employees’ needs. Examples include child care referral programs, sick-child care programs, dependent care reimbursement programs, child care subsidy programs, daycare centers (on- and off-site), flextime and job sharing. A few banks in our readership area that offer some of these programs include First Bank System, Minneapolis; Marshall & Ilsley Corp., Milwaukee; Northern Trust Co., Chicago; Brenton National Bank, Des Moines; and First National Bank of Omaha, Neb. If the nation’s banks want to attract quality employees, reduce turnover and increase productivity, it seems obvious that part of their efforts should include making parents productive. C TAXPAYERS FRUSTRATED WITH the Internal Revenue Service recently got their bill of rights, and now Rod Roath poses an argument for a bankers’ bill of rights to deal with regulators. We’d be interested to hear what both bankers and regulators think about his viewpoint, which begins on page 16. EDITORIAL INTERN Brenda van Dyck CONTRIBUTING WRITERS Rod Roath, Bob Sellers EDITORIAL ADVISORY BOARD Tom Bengtson, Minnesota Bankers Association Neil Harl, Iowa State University Kelly Matthews, First Security Corp. Mark Olson, Arthur Young Thomas Olson, Lisco State Bank Diane Van Boxtel, Valley Bancorp. ADVERTISING SALES DIRECTOR Robert Cronin ART & PRODUCTION MANAGER Nancy Moeller GRAPHIC ARTIST Jennifer Ess TYPOGRAPHER Nancy Fouks PROOFREADER Nadine Hunt CIRCULATION MANAGER Denise Lansing Published by FINANCIAL COMMUNICATIONS, INC. 2850 Metro Drive, Suite 704 Bloomington, Minnesota 55425 (612)854-2177 FAX (612) 854-2627 PRESIDENT Paul Blackburn ACCOUNTING MANAGER Deborah Karlsrud, C.P.A. ADVERTISING SALES OFFICE Robert Cronin, Sales Director 1515 Linden Street, Suite 205 Des Moines, Iowa 50309 (515) 244-8163 FAX (515) 244-8165 CLASSIFIED/LEGAL ADVERTISING Nadine Hunt, Manager 2850 Metro Drive, Suite 704 Bloomington, Minnesota 55425 (612) 854-2177 FAX (612) 854-2627 BANK DIRECTORY PRODUCTS Lisa Leutem, Manager (612) 854-2177 FAX (612) 854-2627 The A u d it Bureau Jennifer Driscoll Editor 6 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis © Copyright 1989, all rights reserved. NO MATTER HOWYOU LOOK AT IT.. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis No 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. ‘A m e ric a ’s N u m b e r O n e C re d it In s u ra n c e S e rvice O rg a n iz a tio n ” North Central Life Insurance Company NORTH CENTRAL LIFE TOWER, 445 MINNESOTA STREET, BOX 64139, ST. PAUL, MN 55164 P h o n e 1 -80 0 -88 8 8-N C L Protection all ways H e a d l in e N e w s Banks Have Less Repossessed Land B anks had le ss r e p o s se sse d farmland last year than they did in 1987, ac cording to a study of 750 banks by the American Bank ers Association. Forty-six percent of banks surveyed in 1987 owned re p o s s e s s e d land, as opposed to 35.6 per cent responding to the Octo- her 1988 survey. Banks with a s s e ts less than $100 million are more likely to own farmland, the survey said. Of small banks, 38.2 percent owned land; of medium-sized banks, 37.4 percent owned land; and of large banks, about 28 per cent owned land. Half of the land was left through farmers’ death and retirement, 31 percent of the farmers left voluntarily be cause of the economy, and another 18 percent left be cause of foreclosures. Only ab o u t 3 p e r c e n t of th e farm ers went out of busi ness. Court Okays Bank Underwriting An federal appellate court gave banks the okay to pack age th e ir own m o rtg a g e loans and to underwrite them as securities. The decision by the Sec ond Circuit Court of Appeals re v e rse s an earlier ruling that found U.S. Comptroller of th e C u rre n c y R o b e rt Clarke in violation of the Glass Steagall Act, which separates the banking and securities fields. Clarke had perm itted Security Pacific National Bank, a unit of Se curity Pacific Corp., to un derwrite mortgages as secu rities. Bank analysts see this de- Fed Increases Banks’ Underwriting Limits T he F e d e ra l R e se rv e Board doubled the amount banks can u n d erw rite for certain private and municipal securities. Banks can now underwrite certain securities for 10 percent of revenue, up from the previous limit of 5 percent. These securities in clude: corporate debt, com m ercial paper, s e c u ritie s backed by m ortgages and consumer debt, and munici pal bonds connected to capi tal from specific projects. The Fed also agreed to al low banks to underwrite se curities backed by the banks’ own loans via subsidiaries. The securities would have to be rated by a national rating agency to ensure impartial credit judgment, Fed gover nors said. Fed governors indicated that this may not be the last in crease, but did not say when they would discuss the issue again. Martha Seger, Fed gover nor, said the 10 percent limit was not high enough to be useful for small and medium sized banks. “ Except for the biggest five or six banks, it is n ’t w orth it to get into this,’’ Seger said. 8 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cision as having significant consequences for banks’ fu ture in the securities market, p e rh a p s sp re a d in g from mortgage to consumer and commercial loans, including ones purchased from other banks. An appeal to the U.S. Su preme Court is expected. FDIC May Have Acted Illegally In a preliminary decision, Federal Judge R obert W. Porter said the Federal De posit Insurance Corp. may have acted illegally when it seized healthy and failed MCorp banks to g eth er in Dallas last year. The ju dge’s opinion ad dresses the FDIC’s policy of failing solvent banks by not paying funds owed to them by seized insolvent affiliates. If the decision is upheld, the FDIC may have to pay millions of dollars in damages to former owners of several closed banks in Texas. Prior to making a final deci sion, the judge will consider the thrift bailout bill, which gives the FDIC the authority to do such things. Banks Post Top Profits U.S. commercial banks re p o rte d s e c o n d - q u a r te r profits of $7 billion, record first-half profits, the govern ment said. F irst-q u a rte r profits of $7.3 billion, combined with the second-quarter totals, give the n a tio n ’s 12,944 commercial banks a higher profit than all previous sixmonth profits, the Federal Deposit Insurance Corp. re ported. Savers, Borrowers Up In 1988 In 1988, consumers saved more of their disposable in come than they did in 1987, but also added more install ment credit, according to a recent report by the Ameri can Bankers Association. The consumer savings rate was 4.2 percent, up from 1987’s rate of 3.2 percent. Consumer installment debt was at a record $691.1 billion at the end of the first quarter of 1989. The average install m ent loan for 1988 w as $8,284, and an average out standing at the end of the year of $7,775. Commercial banks ranked first in lending, holding 48.4 percent of installment credit outstan d in g , an in c re a se from 45.9 percent in 1987. Finance companies held 22 percent, credit unions held 13 percent and savings insti tutions held 9.4 percent. Types of loans made in cluded automobile, personal, revolving lines of credit and home improvement, includ ing home equity loans. Tough time finding the right person for the job? https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Robert H alf provides banks w ith the most direct route to filling key positions. W e’re the largest, most experienced recruiting firm in the world th a t specializes in banking, financial/accounting and data processing. W e recruit and place highly qualified professionals in all areas of banking. □ □ □ □ □ □ □ C hief Executives Lending Investm ent C redit & C ollections M arketing A uditing Financial C onsulting □ □ □ □ □ □ □ O perations A ccounting Retail Branch M anagem ent Data Processing International Trust If you’re hittin g dead ends in your search for a banking professional, call the experts at R obert Half. Ti M> M> M> ROBERT HALF OF CHICAGO, INC. 3340 DUNDEE RD., SUITE 2S-3 • NORTHBROOK, IL 60062 ® 1-312-480-1556 WORLD’S LARGEST BANKING, ACCOUNTING, AND EDP PLACEMENT SPECIALISTS A N K ER S'® »ANKERS® B ^ Copyright, Robert Half International, 1989 SM BY BOB SELLERS PAYING YOUR DIRECTORS Compensation should reflect importance of hoards of directors ngoing change in the finan cial m arketplace has c re ated a more competitive and challenging environment for all financial in stitu tio n s. Consequently, the role of the financial institution board member has grown in importance and complexity. Today’s di rector, working with other board mem bers, must at a minimum perform the following duties: (1) select and retain competent bank management, (2) es tablish, with management, the institu tion’s short- and long-term business ob jectives, and adopt operating policies to achieve these objectives in a legal and sound manner, (3) monitor bank opera tions to ensure that they are controlled adequately and in compliance with laws and policies, (4) oversee the institu tion’s business performance, and (5) en sure that the institution helps meet its community’s credit needs. Complicating these responsibilities are the complex framework of federal, state and regulatory agency laws that guide the activities of a director. The added complexity of a board member's responsibilities has brought with it the increased potential for liability for every action that a financial institution board mem ber takes. This combination of added complexity and the heightened awareness of potential liability has made attracting competent board members even more important. To attract compe tent directors, a financial institution needs to develop a directors compensa tion program which acknowledges both current and long-term compensation needs of a director. O Directors Compensation Policy A financial institution’s board of direc tors usually consists of between seven and 15 members who are elected annu ally by the shareholders of the corpora tion. All board members are classified as either “ inside” or “ outside” direc tors. Inside directors are employees of the corporation, usually the chief execu tive officer and other key senior staff of ficers. It is a widely accepted practice that inside directors are paid directors fees. While they serve the bank in an executive capacity, they are only func tioning as directors in a board meeting. They have the same legal liability as outside d irecto rs and accordingly should be paid directors fees. (Some states do not allow inside directors fees.) Outside directors are usually knowledgable and skilled individuals who have considerable business experi ence, who represent an important seg m ent of society or who are major shareholders of the corporation. Among the increased responsibilities of the board is the design of director compen sation program s. To facilitate board action on compensation issues, a board com pensation com m ittee should be formed. The compensation committee generally consists of three to five direc tors, and usually at least one is an inside director. It is important that members of the compensation committee be able to exercise independent review and analy sis of director compensation. Compensation Practices A properly designed compensation package for directors should consist of (a) current compensation in the form of meeting fees (and possibly committee fees), (b) long-term compensation in the form of fee deferral programs and capi tal accumulation plans, and (c) other perquisites. In setting compensation policy, a board’s compensation commit tee must weigh concepts such as “ re tention-oriented pay” and “ pay for per formance.” At one end of the scale, a board’s compensation policy should pay directors and provide benefits of at least the minimum required to attract and re tain competent individuals. At the other end of the scale, the board’s compensa tion policy should also work to appropri ately compensate directors for their ef forts in making the institution a financial success. Current Compensation Directors meeting fees should be di rectly related both to the size of the fi nancial insitution and to its financial per form ance (m easu red by re tu rn on assets). As the size of the bank grows and its financial performance improves, directors should be appropriately com pensated. The directors, by attending meetings, developing new customers and supporting the chief executive offi cer and management, can make a signifi cant contribution to profits and growth. Their compensation package should re flect your recognition of their contribu tions. Long-Term Incentives In developing successful long-term in centive com pensation policies, the board’s compensation committee should Bob L. Sellers is chairman and chief executive officer of Banking Consultants of America. He is also chairman of First Southern Trust, Memphis, Tenn. 10 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Correspondent Banking at First Chicago An Unchanged Com m itm ent for m ore than 125 Years To learn more about what we can do for you, call Dennis Duffy at (312) 732-4101. Performance has always been a Chicago tradition. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis © F IR S T C H IC A G O focus on increased compensation for performance. Long-term compensation incentives must take into account the rapidly evolving and complex tax and le gal environment. Two long-term com pensation incentives of growing interest are directors deferred in te re st pro grams and equity participation plans. These are discussed in more detail later in this article. Perquisites In addition to current compensation and long-term compensation incentives, many financial institutions are providing additional benefits to its directors. A majority of financial institutions are pro viding additional benefits to its direc tors. A majority of financial institutions reimburse directors for travel expenses and provide director and officer liability insurance to indemnify board members for personal losses sustained from legal action arising out of their activities as board members. Some institutions also provide their directors with group travel insurance, group life insurance and acci dental death and dismemberment insur ance. Directors Deferred Income Plans Cash compensation is an ineffective way to attract, reward and retain good directors. Cash compensation is mean ingless to most directors because they earn a substantial income and are taxed at a high income tax rate. In addition, most directors cannot take full advan tage of individual retirement accounts. A directors deferred income plan is an excellent way to attract, reward and re tain good directors. Similar to an indi vidual retirement account, it allows di re c to rs to save for re tire m e n t, or otherwise, on a pre-tax basis. If prop erly structured, the plan will provide a significant investment opportunity for directors, which cannot be duplicated on an individual basis. The ability to com pound directors fees tax-free until re tirement encourages most directors to participate in a directors deferred in come plan (approximately 70 percent of all board members elect to participate). A DDI plan defers all or a portion of current directors fees for a stated pe riod. When the d irecto r reach es a stated age (usually 65, but in some cases 70 or 75) the director would re ceive a stream of payments over a des ignated period. If the director were to die before retirem ent, the director’s beneficiary would receive the amount owed and payable at retirement age. A deferred income plan generally in volves a separate agreement between NATIONAL BANKING NETWORK SALARY SURVEY President, $1M-$15M capital ............... $35 President, $15M-$30M............................ $40 President, $30M p lu s ...............................$80 Senior loan officer..................................... $50 VP-Installment loan...................................$30 VP-Cash management...............................$40 VP-Private banking...................................$35 VP-Corporate lending...............................$40 VP-Correspondent banking......................$40 VP-Asset-based lending.......................... $40 VP-Credit....................................................$55 VP-Factoring............................................. $55 VP-Team leader......................................... $45 VP-Construction lending.......................... $40 VP-Res. real estate lo an .......................... $40 VP-Comm. real estate ...............................$45 VP-Consumer L ending............................ $25 AVP-Secondary Mtg. M kt.........................$40 AVP-Cash management............................ $30 AVP-Private banking.................................$40 Credit a n a ly st........................................... $25 Account administrator...............................$40 Branch manager (re ta il).......................... $40 C o ntroller..................................................$80 Asst, controller......................................... $45 Auditor........................................................ $60 Accountant..................................................$30 Jr. accountant............................................. $25 VP-Operations............................................$40 AVP-Operations......................................... $30 Manager-Check Proc.................................$30 Mortgage Proc........................................... $15 SV P-T rust..................................................$65 Trust officer................................................$35 Emp. benefits off........................................$50 Personal trust off....................................... $50 Trust adm inistrator...................................$35 Corp. trust admin.......................................$40 Personal trust admin................................. $40 Portfolio m an ag er..............................:. .$55 Personnel assist......................................... $30 Mortgage originator.................................$20 Mort. service m anager............................ $60 Secondary mktg. m an a g er...................... $55 Escrow dept, m an ag er............................ $40 Customer service m anager...................... $40 Branch m a n a g e r....................................... $40 Area m an a g er........................................... $75 C o ntroller..................................................$80 Internal a u d ito r......................................... $30 Underwriter................................................$30 Salaries are stated in thousands of dollars. Information courtesy of the National Banking Network, Virginia Beach, Va. Based on 1988 survey of Midwest banks. NORTHWESTERN FINANCIAL REVIEW Digitized for 12 FRASER https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Wanna talk real exposure? ? risk W hen the farm m arkets do this, not only are your farm clients at risk - so are you! W hen corn prices fall 500, the average bank loses over $500,000.00 in deposits. Since farm ers adm it that m arketing is their weakest m anagem ent skill... Isn't it time you planned a winter farm marketing meeting? Eliminate Risk! Call RWA Now 800 553-8018 - In Iowa - 800-247-0940 RW A F inancial Services, Inc. D avenport, Iowa 319-323-4915 the director and the financial institution whereby the director agrees to forego current payment of directors fees in re turn for a promise by the institution to pay a pre-retirem ent and post-retire ment benefit. The institution can either informally fund the deferral agreement or can let it remain unfunded and make payments out of future institution earn ings. An informally funded approach, however, will generally provide ample funs with which to pay benefits under a deferral agreement and will provide a healthy rate of return to the institution. The informal funding of such deferral agreem ents normally is done by pur chasing a rate-sensitive, cost-effective insurance contract on the life of each di rector in the deferral program. Such contracts are owned by the financial insitution, which is named beneficiary of the policy. The contract would provide the bank with sufficient money to pay the benefits to a director’s beneficiary in the case of pre-retirement and would provide the necessary funding (through the cash reserve value) to pay post-re tirement benefits under the agreement. From a tax perspective, the institution would receive no tax deduction for de posits made on such policies, but upon the death of a covered director, would receive tax-tree death benefits under such contracts. The director would not be subject to current income tax on amounts deferred and would be taxed at ordinary income rates when benefit pay m ent under the agreem ent are r e ceived. Any payments by the institution to the director or the director’s benefi ciary under the agreement would be tax-deductible to the institution. Equity Participation Programs Many financial institutions now pro vide their directors with stock acquisi tion programs to supplement existing cash and other compensation arrange ments. Stock acquisition plans act as a long-term incentive program that can attract, motivate, reward, and retain talented directors. Stock acquisition plans benefit the director and the finan cial insitution in many ways: • They provide the director with a cap ital accumulation program. • They establish a common interest between directors and shareholders. • They enhance the company’s ability to attract and retain effective directors. • They help minimize the use of corpo rate funds for paying directors compen sation. • They can provide an ongoing vehicle for raising capital for the institution through the sale of stock to directors. • They establish a motivational work environment that can stimulate superior director performance. Types of equity participation programs. Choosing a stock acquisition plan that will most effectively serve the interest of the financial insitution, its sharehold ers, and directors requires an evalua tion of many factors. There are three basic categories of equity participation programs: stock purchase plans, stock option plans and stock award p ro grams. There are three types of stock pur chase plans: full m arket value, dis counted or formula value. Stock pur chase plans permit all employees of financial institutions to acquire stock at full market value or some percentage discount or formula discount based on book value or price earnings multiples. The plan generally is available to inside directors. Stock award programs have two varia tions - restricted stock and phantom stock. In a restricted stock plan, the corporation awards a specified number of shares to directors. The director has shareholder voting privileges and rights to all dividends, but, during a stipulated FINE TUNE % v https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis X ... with credit services that make your loan pack ages work: Financing options to fit customers needs. Loans structured to meet their specifica tions—and yours. Timely turnaround, for top-quality performance. SEPTEMBER 23,1989 13 period, may not sell, transfer, or use a stock as a pledge or security for debt. In a phantom stock plan, shares of stock are not actually issued. The director is granted phantom stock units that entitle him to receive, at intervals of time, only the appreciation of the unit. Stock option plans may be tax qualified or non-statutory. The major kinds of non-statutory stock option plans are full price, discounted, variable price, tax offset, and formula value plans. Under these plans, directors are granted the right to purchase company stock at a price fixed at the date the option is granted. The director is under no obli gation to purchase the stock. When ex ercising an option, the director will pay MBA SURVEYS COMPENSATION ru s t officers receiv ed the la rg e s t pay ra ise s am ong Minnesota bank employees during the past year, accord ing to the 1989 M innesota Bankers Association Annual Compensa tion Survey. Top trust department offi cers received raises averaging 13.8 per c e n t o v e r th e p re v io u s y e a r ’s com pensation at the 177 M innesota banks which participated in the 10th an nual survey. The increase tied top lend ing officers for the largest raise among the 72 bank positions covered in the survey. Raises for all trust department employees, however, averaged 11.3 percent, while raises to all lending de partment employees averaged 5.1 per cent. The survey also shows the mean base compensation for chief executive offi cers who own their banks, or the major ity of the bank’s stock, to be $77,940. The survey shows the average owner chief executive officer bonus to be $20,470, making the mean total com pensation $98,410. This figure repre sents a 1.9 percent increase from the 1988 survey. CEOs who own banks in the Twin Cit ies averaged $133,770 in total compen sation, while CEOs who own banks in the Northeast portion of the state aver aged total compensation of $59,460. Owner CEOs in other parts of the state averaged total compensation between those two levels. Not surprisingly, compensation for CEOs increased with the size of the bank. Banks with $81 million to $150 million in assets paid their owner CEOs total compensation averaging $158,980. Owner CEOs at banks with $21 million to $40 million in assets averaged com pensation of $82,850, while ow ner CEOs at banks with $41 million to $80 million in assets averaged $120,950 in total compensation. CEOs who do not own the bank in which they w ork av eraged slightly T 14 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis lower levels of compensation than their counterparts who own the banks in which they work. The total mean com pensation for non-owner CEOs among reporting banks was $90,330. Nonowner CEOs also averaged fewer years in their position. While owner CEOs participating in the survey averaged 14 years on the job, non-owner CEOs av eraged eight years in their position. The MBA Compensation Survey is conducted annually to provide data on officer and non-officer cash compensa tion, related salary administration poli cies, employee benefits and board of di rectors compensation in MBA-member banks. 1989 survey data, compiled by Ernst & Young Human Resources Con sulting Group, reflects information ef fective through last May. The survey showed 51 percent of the participating banks have defined salary adm inistration p rogram s. Of th e se banks, 86 percent have such a program for officers and non-officers. Among the reporting banks, 71 per cent have current job descriptions and 49 percent have a systematic method of job evaluation. Fifty-five percent of the banks have established salary ranges. For the 96 banks reporting established salary ranges, the average of their most recent increase was 4.8 percent. Nearly all participating banks conduct annual salary reviews. Only 6 percent of the banks reported conducting reviews for any employee more than one time per year. One hundred twenty-four banks said they have cash bonus plans. Sixty-four percent of those banks have cash bonus plans for non-officers as well as officers. In the benefits area: • The survey shows 38 percent of the participating banks have short-term dis ability plans, in addition to sick leave. • Thirty-seven percent of the banks of fer an 1RS Section 129 Plan, reflecting a 20 percent increase from last year. (Such a plan allows employees to pay child care expenses with pre-tax dol lars.) • Twenty-seven percent of the banks reported offering part-time tellers a full benefits package. Of those banks not of fering full benefits to part-time tellers, 15 percent said they compensate tellers at a higher hourly rate than full-time tell ers receiving a full benefits package. • Vision care is offered by 7 percent of the banks. • Of the 145 banks which reported having an automobile policy, 89 percent provide an automobile to at least one employee. The survey also looks at compensa tion for board members. The most fre quent method reported for compensat ing outside board m em bers is with m eeting fees only. M ost banks that compensate outside board members per regular board m eeting pay betw een $100 and $299. Most banks reporting compensation for outside board mem bers also said they do not reimburse board members for any expenses re lated to attending m eetings. Almost none of the banks provide outside board members with benefits or perquisites. About half of the banks that have board members who are bank employ ees offer these board members com pensation in addition to their compensa tion for working at the bank. Fifty-two percent of the banks do not provide ex tra compensation to inside board mem bers. Of the 84 banks which said they provide extra compensation to inside board mem bers, 75 percent pay via meeting fees, 17 percent pay with an annual retainer and 6 percent combine meeting fees with an annual retainer. MBA member banks wishing to pur chase a copy of the 1989 Compensation Survey are invited to call MBA offices at 612-338-7851. ■ original grant price. The difference be tween the fair maket value of the option at the date of exercise and the grant price is the economic benefit of the op tion to the director. Equity Plan Issues Before designing or adopting an eq uity participation program, the board’s compensation committee must consider the advantages and disadvantages of each type of plan, the tax effect on the director and the institution, the account ing treatment for the plan, and any Se curities Exchange Commission registra tion is s u e s . At p r e s e n t, th e m ost popular equity participation plans for di rectors are stock option plans. Given the fundamental changes in federal in come taxation enacted by the Internal Revenue Code of 1986 (especially the repeal of the capital gains deduction), non-statutory stock option plans have increasingly become the most prevalent form of stock option plan. Upon exer cise, the excess of the exercise price of the option over the option grant price is taxable as ordinary income (“ spread” ). Correspondingly, the bank receives a tax deduction upon exercise equal to the spread. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Incentive Stock Option Plans Taxes. Incentive plans are not a de ductible tax expense for the employer. To the employee, there is no tax in the year of the grant. At exercise, the spread of the option exercise price and the fair market value of the stock at the time of exercise is a tax preference item. Upon sale, appreciation subject to ordinary income tax rates applies. Accounting. Benefits are not treated as either an expense or liability at any time. Grant of options will affect earn ings per share calculation. SEC Requirements. Shares of stock acquired by exercise of option may have to be registered unless exemption is available. SEC Rule 701 provides lim ited exemption for grant of stock op tions by non-registered corporation. Plan design. Inflexible, must satisfy IRS Code Section 422 A. Im plem entation. S hareholder ap proval is required. Non-Statutory Stock Options Taxes. A non-statutory option is a de ductible expense for the employer in the year the option is exercised equal to the difference between the exercise price of the option and the option grant price. The employee pays no tax in the year of the grant for a non-statutory stock op tion. At exercise, the excess of exer cise price of the option over the option grant price is taxable as ordinary in come. Accounting. The benefits are not treated as either an expense or a liabil ity at any time. Upon exercise of option, tax timing difference added to institution paid in capital or capital surplus. Grant of options will affect earnings per share calculation. SE C requirements are the same as under incentive stock options. Plan design. Flexible, no IRC re straints. Im plem entation. S hareholder ap proval is recom m ended, though not generally required. Stock Option Plan Issues In designing an effective stock option plan, the board’s compensation commit tee needs to determine specific design issues such as which directors should participate, the aggregate number of Continued on page 37 BUILD STRENGTH h .with credit services that let you do more: Special financing to handle complex commercial needs. Extra funds to increase your lending power. Control loans to help your bank grow. SEPTEMBER 23, 1989 15 V ie w p o in t DON’T BANKERS HAVE RIGHTS? ave you e v e r had a d is agreement with a regulator? Every banker can recall at le a st one d isag reem en t. Most bankers I know can tell several personal anecdotes. Some are stories of how regulators helped them by providing sound advice. Some stories are about how examiners missed finding a particular bad loan or opera tional problem. Most frequently, their tales are filled with frustration and even anger. They tell how an examiner criti cized a banking practice or a particular loan seemingly in an arbitrary manner. Even when challenged, the examiner did not provide a reasonable explanation to support the decision. Under the stresses of today’s banking environment, the philosophical differ ences that arise between bankers and examiners sometimes degenerate into personal disputes. Personality conflicts often lead to excessively critical exami nation reports, lowered CAMEL ratings and, occasionally, even regulatory sanc tions. From my perspective, banking regu lators appear to apply banking regula tion in a non-objective and uneven man ner. For example, a $20 million bank or one with a CAMEL 1 rating is more likely to be criticized for a banking prac tice or quality of a particular loan than a $60 million bank or one with a CAMEL 3. This is true even if the facts underly ing the banking practice or loan were identical in both cases. M ost of th e s e s tr e s s sym ptom s would be needless if the definition of concepts such as “ safety and sound ness’’ and “ acceptable banking prac tice’’ were somehow defined. If, for ex ample, regulators could agree on the elements of a good loan policy, there would be fewer disputes over the mer its of a bank’s lending practices. Regulatory oversight is an inescap able part of banking. Too often we read about m ism an ag em en t and in sid er abuses that have led to the collapse of a H NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis B a n k in g Bill of Bights Banking officers should be able to: L ReCy upon advice and information that is provided by banking reguiatory officials from within the official's area of authority. II. Obtain regulatory examinations that are objective and without bios. Crit icisms and negative comments for similar problems and deficiencies should be the same regardless of bankers’ indhndual personality traits, size of the institution, and past examination results. III. Acquire informative arul specific explanation o f the reasons underlying an examiner's criticisms. IV. Have an examiner's decision believed to be a misinterpretation of regula tions or a misapplication o f facts reviewed by the examiner’s superior. V. Receive an objective and workable definition of the term “safety and soundness.” The definition should inclutie explanations and meaningful descriptions o f actions, activities anti transactions that likely would be considered unsafe and unsound. VI. Exercise judgment w ith regard to the manner in which the institution is manat]etf as long as it does not jeopardize the safety and soundness o f the institution. VII. Refer their complaints about regulatory abuses to an ombudsman func tion which would be implemented within each regulatory agency. The ombudsman would have the authority; to modify or delete criticisms from examination reports which are deemed incorrect or inappropriate. VIII. Seek an administrative hearing before being assessed civil money penal ties and regulatory sanctions against the bank, its officers, directors and professional service providers. IX. In administrative hearings and court proceedings, place the burden of proof upon the regulatory agencies to demonstrate that a particular banking practice is unsafe or unsound. X. Obtain reimbursement of legal fees and other costs, if the results o f the ombudsman's investigation or administrative hearings overrule the find ings of the reguiatory agency. XI. Know that the information obtained^ by regulators through examinations or other regulatory processes is confidential and unit not be communi cated outside o f the reguiatory agency. BY ROD ROATH Rod Roath is president o f Roath & Leininger Ltd., a CPA and bank consult ing firm located near Minneapolis. bank or S&L. Insured deposits, and the regulatory supervision that comes with them, bring comfort to depositors that our banking system is safe and sound. Certainly, there are many good regula- tors who have assisted bankers and contributed to their performance. Bankers and a few regulators, how ever, are deeply concerned with recent trends in bank regulation. Regulatory power has multiplied. Simultaneously, the wise and insightful use of these powers has diminished. Arrogance of power has become a frequent mode of regulatory behavior. With justification, bankers become agitated when an ex aminer with six months ’ experience uti lizes apparently im m ature business judgment to unequivocally challenge a bank’s practices in a complex area such as lending, investments, or asset/liability management. What is most distressing about the present system is that bankers have no objective method for questioning the examiner’s judgment. Presumptively, the examiner is always right; the banker is always wrong. Seeing these trends prompts me to ask: Don’t bankers have rights? FIRREA Legislation Adds To Regulatory Powers The Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), enacted by Congress in Au gust, takes the regulatory power grab https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis to new heights. At the same time, FIR REA reduces the discretion, flexibility and rights of bankers to an all-time low. The regulatory pendulum has swung too far. Regulatory agencies have never been noted for their sage wisdom and experi en ce. T he enhanced e n fo rcem en t power granted by FIRREA comes at a time when regulatory talent and experi ence has been stretched to the limit. The formula for regulatory mistakes is made by blending too much power with too little talent and experience. Regula tory mistakes in judgment, in my opin ion, will lead to serious regulatory abuse in a few cases. Optimistically, as the h o rro r sto rie s of th e se reg u lato ry abuses become public, future legislation will be passed to curtail regulators’ power. Indeed, it is unfortunate that a few banking careers and personal for tunes have to be sacrificed to abusive regulatory powers before the resulting public outcry will force legislators to re view the performance of these agen cies. A Bill Of Rights For Bankers Founders Financial Services, Inc. 1600 South 70th, Suite 101 Lincoln, Nebraska 68506 (402) 489-2444 Services provided External EDP Auditing Interna! EDP audit training workshops Dlsaster/Recovery Planning FFS-Analysls (self-examination) Compliance Review Directors audits Loan Portfolio Analysis Bank Management Consulting Software Available Internal EDP Auditing Business Recovery Planning AgMGR (ag loan documentation) LaserTrleve (optical disk storage) Eclipse (Platform) Loan Classification Software Ask about our THIRTY DAY FREE trial period. Like everyone else, banking regula tors must have rules to follow. Stan- n om UK IV ID IÌ IKU ... with First Wisconsin credit services. Powered by specialists devoted to correspondent banking. Helping you nail down a better bottom line—with loan pack ages that are right on the money. Call now for the tools that build success: 414-765-4459. m FIRST WISCONSIN WHENPERFORMANCECOUNTS. SEPTEMBER 23, 1989 17 dards of performance and fairness must be established to guide bankers and reg ulators alike. In order for both parties to work together, there must be a level playing field. Regulators should be held accountable for their actions. Bankers should have rights too. They should be able to obtain a reasonable ex planation for judgments made by exam iners or other regulatory decisions. Also, bankers should have the right to appeal exam ination decisions they believe are not correct due to misinter- B A N K E R ’S E Q U IP M E N T Serving upper midwest bankers with quality Machines & Services since 1937. Sharp Teller Machines (On Line/Off Line) Coin Wrappers (Automatic/Desktop) Coin Sorters MICR Encoders pretation of fact or regulation. In 1988, Congress passed the Tax payer Bill of Rights as part of that year’s tax legislation. The Taxpayer Bill of Rights provides minimum standards of conduct that must be adhered to by the IRS when dealing with taxpayers. It of fers safeguards to taxpayers in r e sponse to past IRS abuses of power by government bureaucrats. Its intent was to provide a better balance between the rights of the individual taxpayer and the vast enforcement tools (such as levy) available to the IRS. The Taxpayer Bill of Rights covers the taxpayer’s reliance upon advice pro vided by the IRS, rules for auditing tax returns, payment of taxes due and legal proceedings between a taxpayer and the IRS. Actually, the Taxpayer Bill of Rights adds to other taxpayer rights previously in effect. For example, the right to an administrative appeal with superiors has been allowed for some tim e. Taxpayers have the right to present their side of the story to an IRS agent’s superior. As another example of administrative protection, it is a felony for an IRS representative to release pri vate taxpayer information in an unau thorized manner. I propose that a Banking Bill of Rights be legislated by Congress. The Banking Bill of Rights, like its counterpart for taxpayers, would offer safeguards to balance more evenly the rights of bank ers and the vast authorities available to banking regulators. What would be included in the Bank ing Bill of Rights? Using the Taxpayer Bill of Rights as a model, I have devel oped simple rules that provide minimum standards of conduct and performance during examinations, when obtaining ad vice and information, and during admin istrative and legal proceedings. They are shown in the accompanying table. I would enjoy hearing the reaction of both bankers and regulators to the Banking Bill of Rights. You might have your own additions to the list of rights. If you agree that a bill of rights for bank ers is needed, please suggest the idea to your U.S. Senator or Representa tive. ■ Author’s Note: Thanks to the bankers with whom I have discussed the contents of this article for their advice, and to my associate, Ford Peterson, for his infor mation on the Taxpayer Bill of Rights. Currency & Check Counters Paper Shredders Fax Machines Kodak Microfilm Equipment Proof Machines ENHANCE YOUR SMALL BUSMESS SERVICE CAPABILITIES Passbook Posting Machines Form Bursters Form Folder/Joggers Calculators (Regular & Loan) If you are u n a b le to say yes, o ffe r an altern a tiv e: R iviera ’s A c c o u n ts R e c e iv a b le Program and more! »receiving needed funding •obtaining full service A/R maintenance & credit management with our experienced staff ★ FALL SPECIAL ★ ASK ABOUT THE INTRODUCTORY PRICE ON OUR NEW PROOF MACHINE! RIVIERA FINANCIAL s B A N K E R ’S E Q U IP M E N T 1 1 5 6 1 1 2 th A v e n u e S o u th B u r n s v ille , M in n e s o t a 5 5 3 3 7 18 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis . satisfying your smaller, riskier customers lending needs • keeping valued checking account balances • maintaining banking relationships for future lending potential Your Customers Benefit By: Please call to discuss your equipment needs. (6 1 2 )8 90 -66 6 1 1-800-328-4827 ext. 1905 Your Bank Benefits By: R V I C “ O F F IC E S N A T IO N W ID E ” B lo o m in g to n O ffic e (612) 921-2389 19 6 9 NEWS BRIEFS Consultants Predict Accelerated Consolidation The pace of consolidation in the bank ing industry will reaccelerate sharply over the next five years as economic in centives and a decline in legislative bar riers more than offset the reluctance to make acquisitions which followed the 1987 crash of the stock market, pre dicted the Bank Marketing Association and the MAC Group, consultants to the industry and authors of a recent study. The MAC Group’s study of the bank ing industry found that growth in market value and size, not simply earnings, is the critical factor affecting the long-term competitiveness and performance of banks. According to the MAC Group, planning strategic acquisitions and mer gers is the emerging focus of corporate strategy in the banking industry. The number of acquisitions of banks peaked in 1986 at 296 when $17.2 billion was paid by acquirers. In 1988, only $9.8 billion of acquisitions were made and the average acquisition size fell to $38 million in 1988 from $56 million in 1986. According to the study, the stock market crash cut back the purchasing power of banks and the price they were willing to pay for other institutions. The superregional banks will no longer be able to generate sufficient growth in earnings, through their cur rent strategies of broad-based geo graphic expansion, because of overca pacity and tig h t m argins in th e ir m arkets, the study predicted. The source of earnings growth in the future is likely to come from dominating spe cific lines of business, according to the analysis. A strategy of expansion along more narrowly focused lines of business will lead to the demise of “ financial su perm arkets,” according to the MAC Group. Consequently, the current domi nation of superregionals will wane as re structuring progresses. The MAC Group analyzed the price/ earnings performance of more than 200 banks involved in mergers or acquisi tions and found that the strategic fit of the involved institutions in nine areas determined how the m erger affected market value. The overriding goal of any m erger, according to the MAC Group, is to increase market value by building “ market franchises,” dominant positions in key lines of business, and by improving operational productivity. Banks At Home With Equity Lines Banks continue to use conservative lending criteria for granting home equity lines of credit and few expect new home equity regulations to impact their prod uct lines negatively, according to an American Bankers Association survey. The report was based on responses by 765 commercial banks surveyed from a national probability sample se lected by asset size. The ABA report found that the most common loan to value ratio remained at 75 percent on variable-rate HELs, and more than eight in 10 banks reported that they used a debt to income crite rion more often in approving HELs than in approving other types of consumer loans. Banks from all size categories re ported the same or slightly lower ap proval rate for HEL applications in 1988 vs. 1987. According to the report, the average home equity credit line granted ranged from $21,500 to $32,000, and borrow ers had typically drawn down about 55 percent. The majority of borrow ers continue to use home equity lines for home improvement and debt consolida tion, with slightly fewer than last year using them for cars, medical bills or va https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cations, the report found. Banks expect new accounts to in crease by as much as 17 percent over 1988. L ess than one in four banks planned to change their home equity line product features as a result of new dis closure requirements going into effect this fall. Total year-end 1988 home equity line outstandings have been estimated at $75 billion, of which commercial banks held $40 billion. Seventy-three percent of bank outstandings were held by insti tutions with assets of $1 billion or more. Home equity line of credit outstand ings represented 2.94 percent of all bank loans outstanding at the end of the third quarter of 1988, up from 2.67 per cent the year before. The HEL delinquency rate continued to be the lowest of all types of consumer credit at banks. During the fourth quar ter of 1988, the delinquency rate aver aged 0.64 percent, one-fourth the rate on closed-end consumer loans (2.63 percent) and about half the rate on tradi tional closed-end home equity contracts (1.78 percent). Asset Based Financial Services A ccounts R eceivable Inventory and M achinery Loans Bank P articipations M onitoring and C onsulting Services For information on your specific needs, call us or have your banker c a ll. . . Donald R. Moberg Chairman Elmer A. Fehring President SEPTEMBER 23, 1989 Stephen L. Bakke Vice President 19 M ic h ig a n R e v ie w Franklin Goes Commercial The board of directors of Franklin Savings Bank approved the filing of an application to convert to a commercial bank charter. Conversions from thrift charters to commercial bank charters became legal under the recent Financial Institutions Reform, Recovery and Enforcem ent Act of 1989 (FIRREA). The charter must be approved by the Office of Thrift Supervision, the Com ptroller of the Currency and Federal Deposit Insur ance Corp., as well as Franklin share holders. Franklin would remain a mem b e r of th e S a v in g s A s s o c ia tio n Insurance Fund, as required by FIR REA. Converting to a commercial bank per mits Franklin to capitalize on its lending PERSONNEL NBD Genesee Bank, Flint, has pro moted Lori D. Rundell to assistant cashier from branch manager. Rundell joined the bank in 1979 as a teller. In 1982, she was named a cus tom er service representative at the Burton Heights office and in 1984 was promoted to assistant branch manager of that same office. She transferred to the consumer loan division in 1986 as a business development representative. In 1987, she was named manager of the customer answer line department and in 1988 became the branch manager of the Grand Blanc East office. Rundell is cur rently serving as branch manager of the South Flint Plaza office. She has earned the applied branch op erational diploma through the American Institute of Banking. Old Kent Bank and Trust Co., Grand Rapids, has appointed Harold C. Schmidt to the personal trust department. Schmidt joined Old K ent Bank of Grand Haven in 1974 and served in vari 20 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis capabilities in a diversified loan portfo lio. The bank currently maintains 52 percent of its assets in commercial mortgage loans, 35 percent in residen tial mortgages and 1 percent in con sumer loans. Virtually all of Franklin’s lending is within Michigan and northern Ohio. Management believes this invest ment strategy would strengthen Frank lin’s earnings capacity and increase earnings stability over interest-rate cy cles. Upon conversion, Franklin would be regulated as a national bank and subject to the regulations and requirements of the Comptroller of the Currency and re lated banking authorities. No significant changes are anticipated in staffing or fa cility expansion. ous positions. His most recent position was vice president in the trust office. Schmidt attended Michigan State Uni versity and has a bachelor’s degree from Valparaiso University. ■ ■■ Manufacturers National Bank of De troit has made the following officer pro motions and appointments: Michael R. Johnson, vice president, system s re search; Michael H. Michalak, second vice president and asset liability officer, as set liability management support: James H. Potrykus, second vice president and operations officer, systems research; Richard M. Tope, second vice president and systems officer, systems application development; John M. Crowley, account officer, Woodward-Hunter Boulevard (branch 39); Christine M. Giancarlo, per sonnel officer, personnel; Dennis E. Minor, systems officer, systems application de velopment; and John H. Scott Jr., opera tions officer, transit and control. ■ ■■ Old Kent Financial Corp. of Grand Rapids has appointed B.J. Myler, chair man of the board and chief executive of ficer; James P. Raffenaud, president; and Theresa W. Erickson, vice president. O b it u a r ie s Oliver M. “Jorgie” Jorgenson died in June of natural causes, Jorsenson, 92, retired as chairman of the board of Se curity Trust and Savings Bank, Lansing, in 1982. He was a past president of the Montana Bankers Association, a former director and member of the Minneapolis District Federal Reserve Board and a former trustee of Rocky Mountain Col lege. He also served on the St. John’s Nursing Home Building Board and had been involved with both Deaconess and St. Vincent hospitals as well as many charitable organizations. He was born in Milnor, N.D., a son of Oley and Gina Jorgenson. In 1929 he married Madeline Leahy in San Fran cisco, Calif.; she died in 1975. Survivors include a daughter, Karen A. DeVine of Lansing; five grandchil dren and a great-grandson. Myler assumes the office of chairman of the board after having served as president of the bank since 1976. Raffe naud has served as executive vice presi dent of the bank since 1986. He be comes the eleventh president of the institution since its origin in 1901. Erickson formerly was an assistant vice president. She is in charge of branch ad ministration and personnel. Erickson has been with the bank since 1982. Bank of Commerce, Hamtramck, has elected Carl R. Weinert chairman of the board of directors, the post that Norman J. Fredericks held for the past 12 years. Fredericks continues his service to the bank as vice chairman of the board of directors and serves on the board of di rectors of the State Bank of Fraser, an affiliated bank. Weinert attained a rarely equalled 43 years of service at Bank of Commerce, 20 years as president and chief execu tive officer. He was named vice chair man of the board in 1987. Weinert con tinues to serve on the board of directors of the State Bank of Fraser and Security Bancorp Inc., the bank’s parent com pany. M ic h ig a n R e v ie w NBD Grand Rapids has approved the following officer appointment and pro motion. William H. Bussell, vice president, gen eral accounting, has been appointed to controller. Bussell came to NBD Grand Rapids in 1975. In 1981, he joined the affiliate NBD Grand Haven Bank as vice presi dent and cashier, until 1988 when he re turned to NBD Grand Rapids as vice president and assistant controller. Bussell has a bachelor’s degree from Michigan State University, and a mas te r’s degree in business administration from Central Michigan University. He attended the School of Bank Adminis tration in 1980, and is currently enrolled in the Graduate School of Banking in Madison, Wis. Ilona B. Klemm, international banking sales rep resen tativ e, has been pro moted to assistant administrative offi cer. Prior to joining NBD Grand Rapids, Klemm spent eight years in the letter of credit department, international divi sion, of the National Bank of Detroit. Klemm has a bachelor’s degree from Wayne State University. ■ ■■ Citizens National Bank of Cheboygan has named Barbara Anderson branch oper ations supervisor in the bank’s Pellston office. Anderson has been employed with Citizens for more than 29 years. She joined the bank in 1960 in the bookkeeping departm ent and subse quently became a teller in Pellston. She has com pleted courses through the American Institute of Banking and is currently attending the Northern Michi gan School of Banking at N orth ern Michigan University in M arquette. The Bussell https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Klemm school, sponsored by the University and the Michigan Banker’s Association, pro vides bankers with a comprehensive overview of the industry. Judy S u s a ls ki was recen tly nam ed branch operations supervisor in the bank’s Indian River office. Susalski has been employed with Citizens for eight years. Susalski joined the bank in 1980 as a teller. She recently completed her aca demic requirements for a degree from the American Institute of Banking and has attended North Central Michigan College. NBD Grand Rapids has prom oted three officers. Promoted to second vice president were Robert L. Doran and Joseph M. Valicevic, both of the real estate finance divi sion. Doran has been with NBD Grand Rapids since 1986. He has a bachelor’s degree from Central Michigan Univer sity and a m aster’s degree in business administration from the same institu tion. Valicevic joined NBD Grand Rapids’ real estate division in 1987. He is a graduate of Central Michigan Univer sity, from which he has a bachelor’s de greeand a m aster’s degree in business administration. Thomas H. Sligh, corporate banking divi sion, has been promoted to commercial banking officer. Sligh came to the bank in 1987. He has a bachelor’s degree from Hope Col lege and a m aster’s degree in business administration from Michigan State Uni versity. Valicevic Liberty State Bank & Trust, Troy, has appointed Jill H. Travis, vice president of marketing, head of Liberty’s invest ment center and corporate services de partment. The investment center offers a full range of discount brokerage and precious metals services. The corpo rate services department provides spe cialized asset management services to commercial customers. Travis joined the bank in 1977 as mar keting and personnel director. She has a m aster’s of business administration de gree from Wayne State University and a bachelor’s degree in business adminis tration from Valparaiso University. Tra vis is a member of the Bank Marketing Association and the National Associa tion of Bank Women. Leonard C. Zazula has been appointed vice president of operations and cashier of the newly organized Republic Bank S.E., Bloomfield Hills. Zazula oversees the bank’s opera tions, accounting, internal controls and other staff responsibilities. He also manages the bank’s operational support and customer service personnel. P rio r to joining Republic, Zazula served in various operational and cus tomer relation positions for eight years at First of America-Southeast Michigan, most recently as vice president and group manager. He also worked with National Bank of D etroit for seven years. Zazula has a m aster’s of business ad m inistration degree from Michigan State University-advanced management program and a bachelor’s degree in management from the Detroit College of Business. Sligh SEPTEMBER 23, 1989 Zazula 20a MICHIGAN REVIEW Arthur R. Cole has been appointed as executive vice president and chief lend ing officer of the newly organized Re public Bank S.E., located in Bloomfield Hills. Cole is to establish and implement policies and procedures for all bank lending activities. In addition to handling loan originations, approvals and busi ness development, he is to assist the chairman in overall administration of the bank. For nearly a decade, Cole has been developing the concept of private bank ing, as a loan officer with Comerica and, most recently, as vice president in the private banking department at Michigan National Bank. Cole has a m aster’s of business ad ministration degree from the University of Detroit and a bachelor’s degree in business law from Michigan State Uni versity. National Bank of D etro it has ap pointed Beth Konrad first vice president and head of the public affairs division. Konrad succeeds Gerald E. Warren, sen ior vice president, who has retired. Konrad joined the bank in November 1988 as vice president and deputy direc tor of the division. Prior to joining NBD, Konrad spent four years with WTVSTV56 as vice president of community development and previously as director of the station’s youth television net work. She also has been director of public affairs and editorials at WDIV-TV4, news director for Golden West Broad casting and a radio news correspondent for the ABC and NBC networks. Konrad has a bachelor’s degree in Cole Konrad 20b NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis communications and speech from Indi ana State University. ■ ■■ First of America Bank, M arquette, has prom oted Liane Callow to branch manager. Callow is responsible for the management and lending functions of the First of America office in Menomi nee. Callow joined First of America Bank in 1985 and has served in several posi tions the past four years. She has a de gree from the University of WisconsinM a rin e tte . She also a tte n d e d the University of Wisconsin-Eau Claire and Northeastern Wisconsin Technical Col lege. ■ ■■ Liberty State Bank & Trust, Troy, has appointed Thomas J. B arrett commer cial loan officer in the commercial real estate lending group, replacing Michael P. M cG overn. B arrett is responsible for commercial mortgage origination. Barrett joined the Liberty State Bank in February 1988 after previous real es tate experience with Detroit-area finan cial institutions. Barrett is a graduate of John Carroll University and has a bache lor’s degree in finance. ■ ■■ D etroit-based Comerica has made management changes in its trust depart ment in preparation for the planned re tirement of Cleveland Thurber Jr., execu tive vice p re sid e n t and chief tru s t officer, on Aug. 31, after 41 years of service with the corporation. Robert S. Colladay, senior vice presi dent, succeeds Thurber as the officer in charge of trust administration. George C. Eshelman, senior vice presi Callow B arrett dent, was named the officer in charge of trust investment, replacing Manown Kisor Jr., executive vice president, who be came a consultant to the corporation. John A. Simonson, executive vice presi dent and chief financial officer, reas sumes from Eshelman the duties of treasurer of the corporation. ■ ■■ Two Bank of Lenawee staff members have been promoted to officers. Debra Jackson-Holdwick was elected as sistant vice president/personnel and training and Scott E. Evans was named a loan officer at the Adrian-based bank. Jackson-Holdwick joined the bank as training director in 1987 and assumed added responsibilities for personnel last August. She had formerly served Jacob son’s as a department supervisor. Currently studying for a bachelor’s degree in arts and human resource man agement at Spring Arbor College, Jack son-Holdwick has an associate degree from Jackson Community College. She is a m em ber of the Michigan Bankers Association management en richment committee. Evans has been employed by the bank since 1980. Starting in the data center, he progressed to teller; the downtown Adrian loan department; assistant man ager of the Courthouse office; and as sistant manager of the Hudson banking center. As a loan officer, Evans is based at the Morenci banking center. Evans is taking courses at the Ameri can Institute of Banking. This summer he is to be enrolled in the Robert Perry School of Banking held at Central Michi gan University. Jackson-Holdwick Evans M ic h ig a n John E. Moon has been elected vice president/marketing and branch admin istration of the Bank of Lenawee, lo cated in Adrian. In the newly created position, Moon is responsible for all marketing activities as well as customer service operations at the bank’s seven offices in Adrian, Hudson and Morenci. Additionally, he supervises security and property man agement for the bank. Moon brought 18 years of banking and business experience to Bank of Lenawee. He is a former president and chief executive officer of the Dime Bank of McClure, Ohio; served as an assist ant vice president and manager of a Sylvania (Ohio) Savings Bank branch of fice; and was a branch office manager for First National Bank of Toledo. Moon has a bachelor’s degree in fi nance from Bowling Green (Ohio) State University and graduated from the Ohio School of Banking, held at Ohio Univer sity in Athens. Thomas K. Fisher has been promoted to senior vice president of Manufacturers National Bank of Detroit. Fisher is offi cer-in-charge, community banking ad ministration. Fisher joined the bank in 1970 in the branch department. He was promoted to account officer in the metropolitan loan division’s eastern region in 1975 and became second vice president and account officer in 1977. He was named vice president and account officer for the division’s central region in 1980 and returned to the eastern region in 1981. Fisher became vice president and sen ior account officer in 1983 and transfer red to commercial financial servicesMoon https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Fisher r e v ie w east in 1984. He was reassigned to the private banking department later that year and was promoted to first vice president in 1986. He transferred to the community banking department in 1987. Fisher attended Georgetown Univer sity. M adison National Bank, M adison Heights, has promoted William J. Donnelly Jr. to vice president. Donnelly has been with the bank for 11 years and continues with his duties in the commercial loan department. Donnelly has a bachelor’s degree from Oakland University and has com pleted post-graduate courses at both the University of Michigan and Walsh College. ■ ■■ Old Kent Bank and Trust Co., Grand Rapids, has appointed Steven R. Hawks as sistant vice president in personal trust. Hawks joined the personal trust de partment of Old Kent in 1987. His back ground includes more than five years of experience in trust operations and trust tax at Michigan National Bank. Hawks has a bachelor’s degree in business administration from Grand Rapids Baptist College. Old Kent Bank and Trust Co. has ap pointed Mark B. Bolling to the newly cre ated position of private banking officer. Bolling joined Old Kent’s credit de partment in 1985 as an analyst. He was promoted to corporate banking repre sentative in the small business division in 1987 and has been serving in his cur rent position as corporate banking offi cer in corporate banking-small business since February 1988. In his new position, Bolling assists in Donnelly developing Old K ent’s private banking marketing emphasis. Bolling has a bachelor’s degree from the University of Colorado and a mas te r’s degree in business administration from the University of Denver. ■ ■■ Michigan National Corp., Farmington Hills, has appointed Gisela A. Gonzalez senior vice president for corporate de velopment. She is responsible for acqui sitions, strategic planning and corporate finance. Gonzalez joined Michigan National from Continental Bank Corp., where she was senior director of mergers and acquisitions, and had responsibility for merger and acquisition activity within the financial industry sector. From 1984 to 1986, she worked at Drexel, Burnham Lambert as vice pres ident and director of risk evaluation in the institutional financial futures divi sion. She was responsible for setting up a consulting and value-added research capability for S&Ls and commercial banks. In 1980, she joined Kaplan and Smith Associates as senior vice president with responsibility for the m arketing and management of client-consulting en gagements in the thrift industry. There she was involved in mergers and acqui sitions, consulting on assisted transac tions of troubled S&Ls, including nego tiation with regulatory agencies. Gonzalez has a m aster’s degree from Carnegie-Mellon University in P itts burg, Pa., and a bachelor’s degree from Washington University. She also has completed the requirem ents for the doctorate program at the Graduate School of Industrial Administration at Carnegie-Mellon University. Gonzalez Hawks SEPTEMBER 23, 1989 M ic h ig a n r e v ie w First of America Bank Corp., Kalama Kalamazoo, in 1965 and held various management positions, the last of which zoo, has promoted five officers. Thomas was senior vice president - director of W. Lam bert was named executive vice president; John B. Rapp was named exec personnel and secretary to the board. utive vice president; David B. W irt was He was named vice president and direc named executive vice president; Donald tor of personnel for First of America Bank Corp. in 1975. In 1981, he was ap J. Kenney was named senior vice presi dent; and Kevin Thompson was named vice pointed senior vice president-human re sources and marketing, and served as president. Lambert is chief financial officer and secretary to the board for the holding treasurer for the corporation. He joined company. Wirt became president and First of America Bank-Michigan, Kala chief executive officer for F irst of mazoo, in 1963. He was named vice America Bank-Wayne Oakland, Royal Oak, in 1984, and returned to the cor president and cashier in 1976 and was promoted to senior vice president in porate staff as senior vice president in 1987. 1980. In 1979, he was appointed vice Wirt has a bachelor’s degree from president for First of America Bank Corp. and was named senior vice presi Western Michigan University. He has completed the Commercial Bank Man dent-funds management in 1981. He was named chief financial officer and agement School at Columbia University and the Graduate School of Banking at treasurer in February 1988. Lambert has a bachelor’s degree from the University of Wisconsin. Kenney is president of First of Ameri Kalamazoo College and a m aster’s de gree in business administration from ca’s computer services division. He W estern M ichigan U n iv e rsity . He joined First of America’s computer ser serves as a trustee for Kalamazoo Col- vices division in 1986 as president. Pre viously he held data processing and re lege. Rapp is responsible for administration se a rc h -re la te d p o sitio n s for o th e r of the company’s trust and financial ser corporations, including the Federal Re serve Bank of Boston from 1967 to vices division and is secretary to the board of directors. He joined First of 1983. Kenney has a bachelor’s degree from America Bank-Michigan, Kalamazoo, in 1966 and also was named trust officer Northeastern University in Boston and that year. In 1971, he was named vice a m aster’s degree from the Massachu president and was promoted to senior setts Institute of Technology. He is a vice president in 1976. Rapp was named member of the operations committee vice president for the holding company for the Michigan Bankers Association. Thompson is controller for the corpo in 1985. In November of that year, he ration. He joined the company last year. also was named senior vice presidentHe held various accounting positions trust. He was appointed secretary to with a Florida financial institution from the board in 1987. 1978 to 1988 and had served as vice Rapp has a bachelor’s degree from Yale University and a law degree from president-financial accounting just prior to joining First of America. the University of Michigan Law School. Thompson has a bachelor’s degree He also is a graduate of the National Trust School at Northwestern Univer from Clemson University in South Caro sity in Chicago and of Columbia Univer lina. He also has completed the Stonier sity’s executive program. He is a mem Graduate School of Banking. ber of the Michigan and Kalamazoo Bar Associations. He has been a member of Franklin Savings Bank, Southfield, re the trust legislative committee for the cently appointed Rebeka David-Christian, Michigan Banker’s Association. Wirt is responsible for the perform Marjorie Duncanson and llene M. Klamer vice president and Linda J. Liggons assistant ance of certain First of America affiliate vice president. banks. In addition, the senior officers David-Christian, vice president, cor responsible for human resources and porate communications director, is re revolving credit re p o rt to him. He sponsible for investor relations, press joined First of America Bank-Michigan, 20d NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis relations, employee and community communications. David-Christian joined Franklin in 1985 and was assistant mar keting director before being promoted to assistant vice president, corporate communications, in 1987. Prior to join ing Franklin, she was employed by Em pire of America for five years, last hold ing a position in the marketing/business development department. Duncanson, vice president, Southfield branch manager, has served in several branch capacities since joining Franklin in 1984. Duncanson has managed the Southfield branch since 1985 and was el evated to assistant vice president status in 1986. During her tenure as branch manager, Franklin’s Southfield branch has grown to $214 million in total de posits, making it the second-largest branch facility in Oakland county. Dun canson was a systems analyst for Michi gan Millers Insurance for three years before coming to Franklin. Klamer, vice p resid en t, a ssistan t marketing director, came to Franklin in 1984. Most recently, Klamer held the position of assistant vice president, sales director. Klamer is responsible for all savings area sales activity in both re gional branches and the main office. For six years prior to joining the Franklin marketing department, Klamer was an account representative for Fairlane As sociates Insurance. Liggons, assistant vice president, senior account executive, joined Frank lin in 1984. Originally a member of the Southfield branch staff, Liggons has overseen Franklin’s $50 million institu tional savings portfolio since 1986. Lig gons attended Wayne State University. Before beginning her career at Franklin, Liggons spent five years in the insur ance industry, holding positions with National Ben Franklin and Wausau In surance companies. Noreen Berg recently has been pro moted to assistant vice president by Bloomfield Hills-based Fidelity Bank’s board of directors. Berg, currently the bank’s consumer loan officer, has been employed by Fi delity Bank for the past eight years. She is currently attending Oakland Commu nity College. I l l in o is r e v ie w LaSalle Purchase Part Of Earnings Strategy LaSalle National Corp. is buying Ex change Bancorp Inc. to make itself a better, more efficient large bank. This deal also consolidates the fourth- and fifth-largest banking operations in the Chicago area, a move that just might make their competitors nervous. The merger allows LaSalle to double its market share in that competitive re gion, to 12 percent. The action comes only one year after LaSalle acquired Lane Financial, which was the Chicago region’s sixth-largest banking group. Presently, LaSalle is out of the acqui sition business until this one is “ di gested,” said Harrison Tempest, presi dent and chief executive officer of LaSalle National Bank. LaSalle is buying Exchange for $420 million in cash, or 2.4 times value. Tem p e s t said E xchange is w o rth th a t amount because ot its earnings power. “ Considering Exchange’s earnings po tential, we paid a very reasonable pirce,” Tempest said. ’’This was a fair deal.” According to Tempest, LaSalle had been casually talking about acquiring Exchange Bancorp Inc. since 1987, but did not begin serious negotiations until April of this year. Tempest said LaSalle saw it needed additional capital to service larger cus tomers, and acquiring Exchange was a good way to achieve that. Exchange was attractive because of its location (its offices touch that of La Salle in one corner) and strong manage ment team, Tempest said. In addition, Exchange had just begun to convert some of its operational systems, making this an ideal time to merge. Exchange also had strengths that La Salle lacked, like its powerful assetbased lending group. In addition, Tem pest said, Exchange is more leveraged. In th e sam e way, L aS alle had strengths Exchange needed. John Rau, president and CEO of Exchange Bank, said the deal not only was attractive for its shareholders, but complemented its services with LaSalle’s strong trust de partment and large community banking organization. Continental Creates Subsidiary Harris To Buy Frankfort Bank Continental Bank Corp., Chicago, plans to create a subsidiary to offer mergers and acquisitions advisory ser vices to public and private companies. The subsidiary is to be co-managed by Gidon Y. Cohen, David P. Loseff and Michael A. Smith. Previously, Loseff and Smith were managing directors at Bear, Stearns & Co. Inc., Chicago. Co hen was an associate director. The three have experience handling transactions from origination through execution. They have conducted exclu sive sale and acquisition advisory as signments, restructurings, recapitaliza tions, hostile defense-related activities, valuations and fairness opinions. The subsidiary is subject to the ap proval of the Office of the Comptroller of the Currency. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Chicago-based Harris Bankcorp Inc. has signed a letter of intent to buy 100 percent of the common stock of Frank fort Bancshares Inc. for $15.5 million cash. Frankfort Bancshares is the ma jority owner of Frankfort State Bank. Frankfort State Bank has total assets of $79 million and total deposits of $70 million. If approved, the acquisition would be the first made by Harris Bankcorp in suburban Will County. In addition, LaSalle has a large corpo rate and international market, so now custom ers of Exchange have an ex panded market with which to work. Tempest said it was a good transac tion for both because both banks have slightly different sized customers. Now, Tempest said, “ We are able to fill in the cracks in our marketplace.” Rau said the two fit side by side and do more ‘‘filling in the gaps,’’ than dupli cating. According to Rau, Exchange has im plemented a hiring freeze. While Ex change is evaluating staff needs and possible cuts, there are some duplicate positions that will be needed, Rau said. The combined banks will operate un der the LaSalle name with the banking functions operating in the Exchange building, and the trust and bank holding functions operating in the LaSalle build ing. The proposed acquisition is subject to the signing of a definitive agreement and to regulatory approval as well as to the approval of shareholders of Frankfort BancsharesInc. If its sale is approved, the bank would bring to 12 the number acquired by Harris Bankcorp since its acquisition program began in 1982. American Buys Wisconsin Firm American National Corp., Chicago, acquired Citizens Holding Corp., a Wis consin bank holding company and parent of the $16-million Citizens State Bank, Genoa City, Wis. The acquisition is subject to regula tory approval. Terms of the sale were not disclosed. ANC is the holding com pany for American National Bank and Trust Co. of C hicago and affiliate ban k s in Arlington Heights, Bensenville, Elgin, Lansing, Libertyville and Melrose Park. American National is a wholly-owned subsidiary of First Chicago Corp. SEPTEMBER 23, 1989 21 o I l l in o is r e v ie w Bank Sponsors The Alpiners Mundt was recently named general manager by the CIRRUS board. As the network’s No. 2 person, he is responsi ble for sales, marketing, administration and finance for CIRRUS. He also is in charge of the M asterCard ATM net work, created in June. Prior to joining CIRRUS, Mundt was a vice president at Chase Manhattan Bank. He is a graduate of Amherst Col lege. He also has a m aster’s of business administration degree from the Univer sity of Chicago. William J. Hocter, executive vice presi dent of the Illinois Bankers Association, was elected chair of the G raduate School of Banking and of the Prochnow Educational Foundation, both headquar tered in Madison, Wis. The Prochnow Educational Founda tion enhances the Graduate School of Banking and serves its various constitu James E. Wells, chair and chief executive o ffice r o f Cosmopolitan National Bank, Chicago, encies by funding the development of welcomes Dick Theml and the “ Alpiners” to St. James Cathedral Summerfest. Cosmopolitan Bank programs and materials for the school, sponsored the “ Alpiners” last month outdoors at the corner o f Rush and Huron streets. as well as research projects, scholar ships and awards. H o cter has broad e x p e rie n c e in higher education and professional devel Chicago area. PERSONNEL Pehrson was most recently with Bank opm ent for bankers. In 1988 Gov. One, Indianapolis, where she served as James R. Thompson appointed him to a a commercial lending officer. She has a six-year term on the Illinois State Schol President Bush appointed Harold B. bachelor’s degree in finance from Indi arship Commission and he also was re cently appointed to the Illinois Educa Steele, Princeton, to fill one of two va ana University, and also attended La tional Facilities A uthority. He has cancies on the Farm Credit Administra Sorbonne in Paris. George A. Sikorski, MAI, recently joined served on the American Bankers Asso tion board of directors. If approved by the Senate, Steele the Exchange National Bank as vice ciation’s education policy and develop would be nominated as chair/CEO of the president in the real estate division. He ment council and its state association di is responsible for real estate appraisals vision executive committee. He is past FCA. president of the Central States Confer Steele is former chair of the National for the bank. Prior to joining the Exchange, Si ence of State Bankers Associations. Commission on Agricultural Finance and He began his banking career in 1962 was president of the Illinois Farm Bu korski was with Savings of America in reau Federation from 1970 to 1983. He Oakbrook Terrace, 111., where he was at the Federal Reserve Bank of Chicago also served on the board of a bank hold major loan appraisal manager. Before and served as vice president and chief ing company in northern Illinois that has that he was owner of MAS Appraisal economist at the Federal Reserve Bank several community banks as subsidi Services and was vice president of L.J. of Cleveland from 1969 to 1977. In addi tion, he was associate economist to the Sheridan Co. aries. Federal Open Market Committee. Hocter has both an undergraduate de gree in political science and a m aster’s G. Henry Mundt III, senior vice president Laurie S. Pehrson has joined the Ex degree in business administration from with CIRRUS System Inc., was pro Xavier University in Cincinnati, and a change National Bank of Chicago as an moted to general manager of the com doctorate in business administration assistant vice president in the metropol pany, based in Downers Grove. itan division of the bank’s commercial from Indiana University. Mundt has been in charge of the net lending group. She is responsible for work’s marketing activities since 1983. business development in the greater 22 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis I l l in o is Gary Nlurkowski was recently appointed senior vice president and comptroller at Cosmopolitan National Bank in Chicago. Murkowski came to Cosmopolitan from the accounting firm of Deloitte, Haskins and Sells, where he was manager of fi nancial service industry clients. P re vious to spending his eight years at De loitte, Haskins and Sells, he worked with Ernst and Whinney for six years. In his 14 years of experience in public accounting firms he has provided audit ing, EDP auditing and information tech nology consulting services to clients in savings and loan associations, banking, mortgage banking, insurance, mutual funds and manufacturing. Murkowski is a CPA licensed to practice in the state of Illinois. Murkowski grew up in Rhinelander, Wis., where he graduated from the Uni versity of Wisconsin with a bachelor’s degree. Eusebio Arce has been named to the board of directors of Metropolitan Bank in Chicago. Arce is president of Tropical Optical Corp. and Sun Optics Inc., both based in Chicago. The Larkin Bank, Elgin, has pro moted two officers. Named assistant vice president in commercial loans was David C. Rasmussen, and named opera tions officer was Pamela I. Summerkamp. Rasm ussen becam e assistan t vice president after working for Larkin as a commercial loan officer since his career first began with the bank in 1985. Prior to joining Larkin, R asm ussen spent eight years with First National Bank and https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis r e v ie w Trust of Rochelle as a commercial loan officer. A graduate of Northern Illinois University with a m aster’s of business administration degree, he also com pleted an undergraduate degree in fi nance at Northern. Rasmussen is an associate member of Robert Morris Associates. Summerkamp became operations offi cer at the bank after serving as an as sistant supervisor in operations. She began her career with Larkin in 1981 as a bookkeeper. ■ ■■ Stephen J. Gray was elected a vice presi dent of Harris Bank, Chicago. His division provides credit and other services to mid-sized companies in the Chicago area. Gray joined the bank in 1983 as a rep resentative in the corporate banking de partment and has had numerous posts in the Midwest group. He has a bachelor’s degree from Indi ana University and a m aster’s degree from N o rth w estern U niversity. He serves on the finance committee of the Montessori School of Lake Forest. ■ ■■ The Federal Reserve Bank of Chi cago made the following promotions: Herbert L. Baer Jr. was named assistant vice president and senior economist in economic research. In the new position, Baer continues his responsibility for di recting financial system and regulatory research projects. In addition, he as sumes a broader role in developing bank policies relating to financial system risk. Baer joined the bank as a research economist in 1981 and was named sen ior economist in 1985 and research offi cer in 1987. He has a bachelor’s degree in economics from Ohio University and a doctorate in economics from North western University. Sheryn E. Bormann was named assistant vice president in support services. Bor mann, personnel officer since 1987, continues to direct several human re source division activities, while assum ing responsibility for compensation. Bormann joined the bank in 1982 and worked in both the travel and purchas ing divisions before being named man ager of purchasing services in 1985. Bormann has a bachelor’s degree in education from Western Illinois Univer sity, and is a m aster’s candidate at DePaul University. Kristi L. Zimmermann was appointed ad ministrative officer for support services with responsibility for the bank’s pur chasing, contract administration, travel, food service, graphic design, print shop and employee activities divisions. Zim mermann has experience working in both the travel and purchasing divisions. She joined the bank in 1984 as travel su pervisor, moving to automation services in 1986 as a staff analyst. In 1987 she was named manager of purchasing ser vices. Zimmermann has a bachelor’s degree from the University of Colorado and is a m aster’s candidate at DePaul Univer sity. James Nieds was appointed senior vice president and senior trust officer for Cosmopolitan National Bank of Chicago. Prior to joining Cosmopolitan, Nieds op erated his own business, Nieds Finan cial Services, which researched and de veloped potential joint ventures in the area of affordable housing, tax credit syndication and financial planning. In his 20 years of banking experience, he has worked in retail banking and branch banking. Also, Nieds worked for eight years at Avondale Federal Savings Bank, where he was executive vice president in charge of marketing and op erations. Nieds graduated from Loyola Univer sity and has an undergraduate degree in physics and a m aster’s of business ad ministration degree in marketing. SEPTEMBER 23, 1989 23 I owa r e v ie w Iowa Bankers Association Golf Outing A Success The annual Iowa Bankers Association golf outing (formerly past president’s golf outing) was a success with more than 60 golfers attending. The event was played in Iowa City at Finkbine. Following golf, the bankers had lunch together and held an awards ceremony chaired by Clair Lensing, IBA past pres ident. This year’s outing included, for the first time, a traveling trophy and awards for first, second and third place. Win ners were: First place - Terry Martin, M erc h a n ts N ational B ank, C ed ar Rapids; second p la c e -Jim Angstead, Ankeny State Bank; and third place Tom L arson, W e stc h e ste r Savings Bank. by Robert Cronin Below: Tom Larson shot third place. Above: Clair Lensing, le ft, Farmers Sav ings Bank, Marion, with first-place fin isher Terry Martin, Merchants National bank, Cedar Rapids. At le ft: Jim Angstead, Ankeny State Bank, proudly accepts his secondplace trophy. Below (le ft to right): R. S cott Fetner, National Bank W aterloo; Paul B lackburn, publisher, Northwestern Financial Review, Bloomington, Minn.; Neil Milner, IBA, Des Moines; and Bob Rigler, state superintendent o f banking, New Hampton. M 3*r At right (le ft to right): John Hartmann and Clair Lensing, b o th w ith F a rm e rs S ta te Bank, Marion, and John Soren sen, Iowa Bankers Associa tion, Des Moines. (f r r ^ O L o f f ic e o n c e p t s . J x— ^ i LTD Designers end Builders of Finenciel Institutions Committed to your Building and Remodeling Needs Ross Schoonover Vice President P.0. Box 808 • 319 Broadway • Digitized for24 FRASER NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Waterloo, Iowa 50704 • 319-234-1221 "Kirk Gross Company did an excellent job on our renovation':.. and we couldn't be happier with the final re sults. We set OUt tO reStore a his- R. Scott Fetner/Presldent Iowa National Bank Corp & The National Bank of Waterloo torical landmark — the railroad de pot in downtown Cedar Falls. The plans, interior design and attention to detail resulted in a bank that our community is proud of." Kirk Gross Company has built or remodeled nearly 300 financial facilities in Iowa alone. Each one unique . . . each with individual re quirements. Kirk Gross Company can handle the challenge w ith full architectural, interior design and construction capabilities under one roof. You can get one phase or the whole project completed quickly with one source of responsibility Put our expertise in financial facilities to work on your next building or remodeling project. Ask our satisfied customers . . . no one in Iowa does it better. For more information, call or write The Kirk Gross Company, 4015 Alexandra Drive, PO. Box 2097, Waterloo, IA 50704. Phone: (319) 234-6641. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis IOWA REVIEW Brenton Overcomes Weather, Swims Channel J.C. (Buz) Brenton, executive vice president, Brenton Banks Inc. and chief executive officer, B renton National Bank of Des Moines, swam the English Channel last month. The swim took 13 hours and 30 minutes under very poor weather conditions, which had delayed earlier attempts. “ This was something that I’ve always wanted to do; a per sonal goal I set for myself,’’ said Bren ton, who had been in training for this swim since September 1988. Gin Vogel and Todd Rohlfsen, V.P. Farmers State Bank — Jesup u The tw o m ain reasons w e cho se th e LaserPro loan docu m en tatio n system w o u ld be first for th e com pliance issues and th e assurance this loan will m eet th e c u rre n t com pliance requirem ents. W ith th e backup of attorneys all over th e U nited States, w e receive com pliance on our loan portfolio. K eeping up to date o n th e changes in com pliance req u irem en ts has b een m ade a lo t easier. The o th e r reason w e chose LaserPro is its sp eed in processing. This is very apparen t in th e ability to p u t o n standard loans. W e found that w e can p rin t o u t any type o f loan, installm ent, agriculture, real estate, etc., m uch faster than w ith th e p re p rin te d forms, w h ich th e n allows us m ore tim e to c o n c e n tra te on o th e r areas.” For m ore in form ation or if y o u w o u ld lik e a private d em on stration o f th e LaserPro loan d ocu m en tation system , contact Gary Livesay, Vice President, Iowa Bankers In surance Services 1-800-532-1423. 26 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Brenton began his swim on Shakes peare Beach near Dover, England, at 12:35 p.m., Wednesday, August 16, and finished near Calais, France, at 2:05 a.m ., Thursday, August 17 (English time). To protect against extremely cold weather, Brenton was coated with a mixture of lanolin and vaseline, which is used by most channel swimmers. Addi tionally, to make himself visible at night to the accompanying support and rescue ship, Brenton wore a light strapped to his back. While the direct distance across the channel at this point is only 21 miles, most swimmers can expect to swim be tween 28 and 34 miles due to currents and tides. Normally about 40 people a year attempt to swim the channel, but only about 10 percent are successful. Besides weather conditions and tides, swimmers face a grueling physical or deal complicated by commercial ship ping traffic in the channel, bitter cold water and stinging jellyfish. Brenton has spent his entire business career in the Brenton Bank system. Be ginning in 1961, he has worked at the banks in Dallas Center and Davenport before coming to the Des Moines oper ation in 1970. Brenton graduated from Yale University and served for two years in the U.S. Army before starting his business career. First National Remodels First National Bank of Dubuque added 9,756 square feet to house the trust de partment and a business development area. The trust department expanded to eight private offices, two private confer ence rooms and a new trust library. It also added a specialized computer area and storage space. The new business development area includes entertainment, dining and sem inar facilities. The building materials and work were provided by local suppliers and subcon tractors. I owa r e v ie w Charles City Banks Form Community Alliance Charles City is like many farming communities in the Midwest. It took its lumps during the farm crisis in the mid 1980s. When the city’s biggest em ployer, White Farm Equipment, filed for bankruptcy in 1985 and laid off most of its 700 employees, Charles Citians saw it as a sign of the times. Likewise, it was a sign of the times when the company reopened in 1987 under new m anagem ent and a new name. It was an indicator that Charles City, too, had in a sense reopened for business. Public and private initiatives and positive attitudes helped bring it about, say city officials. To avoid a repeat of 1985, an unlikely alliance formed last year to bolster Cha rles City’s business community. In a project called D evelopm ent 90, the city’s banks, First Security Bank & T rust and C itizens N ational Bank, teamed with the Charles City Area De velopment Corp. Each bank committed 8250,000 to a loan pool. By offering at tractive financing to qualified clients, the banks have given existing retailers money to grow with, and out-of-town merchants the incentives they need to move to Charles City. “ We’re making definite progress,’’ said Don Chaplain, president of the Cha rles City Area D evelopm ent Corp. ‘‘But we still have some holes to fill.’’ Norm G erdes, vice president and marketing officer of First Security Bank & Trust, called Development 90 original and unique. “ I ’ve never seen this type of cooperative effort on the retail side. PERSONNEL John R. G irotto, vice president and gen eral manager of the Collins Air Trans port Division/Rockwell International, has been appointed to the board of di rectors of Norwest Bank Cedar Rapids. While serving on Norwest Bank Ce dar R a p id s’s B oard of D ire c to rs , Girotto reviews and advises the bank on its community m arketing initiatives, lending practices and operational effec https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Historically, it’s done for industry.’’ Last year, four applications for Devel opment 90 loans were approved by a re view committee, comprised of repre s e n ta tiv e s of th e b an k s, city and developm ent corporation. One bor rower filled a Main Street vacancy, two joined the Cedar Mall - now 95 percent occupied - and the fourth opened a res taurant where a previous one had failed. Through Aug. 1 of this year, 15 appli cations have been received. When Jim and Judi Brown were look ing to move from suburban St. Paul, they read an ad in the newspaper about D ev elo p m en t 90. T h a t’s all th ey needed. With a Development 90 loan they opened a 2,400-square-foot wom en ’s sportswear store in Cedar Mall called The Look. Jim Brown said he and his wife likely would have moved to Charles City any way, and could have found other financ ing. But the Development 90 package was “ a plus’’ in their decision, he said. “ We felt the need for our operation in this city.’’ They felt the need because it was ex pressed to them. Two days each month, a recruiting team visits pre-selected merchants elsewhere in the state hop ing to lure them to Charles City. The recruiting team, consisting of a loan offi cer from each bank and city develop ment officials, knows what Charles City needs, whether it’s a m en’s clothing store or a women’s shoe store. And they travel hundreds of miles to find it. Charles Perry, vice president of Citi tiveness. Girotto has a m aster’s degree in busi ness administration from the University of Iowa and a bachelor’s degree in elec trical engineering from the University of Kansas. In 1960, Girotto began his career with the former Collins Radio Co. He later was appointed director of engineering for Collins Air Transport Division and assumed the responsibility for technol ogy acquisition, design and develop ment activities. Girotto has served in in creasingly responsible m anagem ent positions leading to his current appoint zens National Bank, said Development 90 “ fo sters community support. It works because it takes concessions from everybody. The load is shared.’’ The maximum loan under the pro gram is $50,000. Perry said he couldn’t determine an average from the loans his bank has processed, but m ost have been for $25,000 or less. None have been used for real estate purchases. Primarily they have been used for re modeling and increasing inventory, he said. Gerdes from First Security said his loans have ranged from $25,000 to $50,000. “ We treat is as a normal loan procedure.’’ When reviewing applica tions, the committee considers such factors as the immediate and potential for job creation, whether the loan would help expand or diversity services to the community, the nature of the business and its location. Interpretation of those criteria is “ in tentionally loose,’’ to encourage applica tions, Gerdes said, but some loans have been denied. Chaplain of the development corpora tion is enthusiastic about the potential for Charles City under the plan. “ The most positive thing is w e’re not sitting on our duffs. We can’t say w e’ve 100percent solved the problem, but w e’re making a legitimate effort.’’ And in case anyone’s interested, Cha rles City needs a men’s clothing store. by Jody Olson ment as vice president and general man ager of Collins Air Transport Division in 1986. Tom Smith, executive vice president of Bankers Trust Corp., Des Moines, was named president-elect of the University of Iowa Alumni Association board of di rectors for 1990. The board oversees programs and activities of the 40,000member alumni association. Smith is a graduate of the University of Iowa. SEPTEMBER 23, 1989 27 MINNESOTA REVIEW Computers Bring Banking Into The Home A new c o m p u te r s y s te m m ight change how bankers reach their cus tomers. Prodigy, a partnership of IBM and Sears, is an on-line system that al lows anyone with a personal computer and modem to bank from a keyboard as well as shop, buy and sell stocks, check w eath er, be u p dated on new s and sports, and make travel arrangements. Steven Hein, Prodigy’s communica tions m anager, has b een banking through Prodigy for about six months. He said Prodigy is the concept of the future for home banking. At rig h t: Steven Hein, Prodigy’s program man ager of communications, has been b a n kin g on Prodigy fo r the past six months. Below: Celia Clark and her brother, Ben, play a game on Prodigy. Photos by Brenda van Dyck WHY YOU SHOULD CONSIDER A BANKERS/PLUS LEASE • Leasing Keeps Capital and Deposits Working for Your Bank • Leasing Offers Tax Advantages • Leasing Simplifies Budgeting Call Bankers/PLUS today for more information on how you can put the advantage of leasing to work for you! Baâersîms A LeaseAmerica Group 4 3 3 3 E dgew ood R oad N .E ., C edar R apids, Iowa 5 2 4 9 9 J.P. K em ps 3 1 9 - 3 9 8 - 7 9 6 3 or 8 0 0 - 5 5 3 - 7 2 8 7 28 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis . He checks his account balances and pays bills by Prodigy. His paychecks are deposited automatically, then he tells the bank how much to pay on each of his bills and the bank deducts that amount from his account. He also uses an instant cash card. “ It helps me save a lot of time,” Hein said. Consumers also can transfer money from accounts through Prodigy. Consumers can even apply for loans on the system by completing a loan ap plication on the screen. Hein said by eliminating some steps in the loan proc ess, a person saves time through Prod igy by not having to visit the bank. “ People see home banking as one of the most attractive aspects of Prodigy.’’ Nationally, six banks are set up to ser vice Prodigy custom ers. They are: Bank of New England, Boston; Cornerica, Detroit; National Bank of Detroit; First Interstate Bank, Denver; Manu facturers Hanover Trust, New York; and Sovran Bank, Washington, D.C. The Prodigy service debuted in Min neapolis, its 16th m arket, early this month. By year’s end, approximately 45 areas are expected to be set up for the serv ice. In the Twin C ities, about 115,000 households are set up for Prod igy, with a potential to serve 300,000 people. C ost of the sy stem is $9.95 per month. by Brenda van Dyck M in n e s o t a R e v ie w Norwest Applies First Bank Forms Subsidiary The First Bank System capital mar other securities firms and regional For Powers kets group, Minneapolis, received ap Norwest Corp. in Minneapolis has ap plied in to engage in leasing personal or real property, or acting as agent, broker or advisor in leasing such property and commercial finance through the acquisi tion of Crestwood Capital Corp., Min neapolis, and C restw o o d Financial Corp., Minneapolis. Norwest Corp. also has applied “ to engage de novo through Norwest In vestment Services Inc. in the following activities: 1) Underwriting and dealing in obligations in which national banks are authorized to deal; 2) Underwriting and dealing to a limited extent in certain se curities in which national banks are ineli gible to deal; 3) Full-service retail bro kerage; 4) Providing private placement services for commercial paper, munici pal revenue bonds, municipal leases and m ortgage-backed securities; 5) P ur chasing and selling precious metals and coins for the account of customers; and 6) Acting as a futures commission mer chant. Dain Bosworth Acquires Firm Dain Bosworth Inc. has acquired the assets of Municipal Bond Underwriters Inc., an Omaha firm that originates and distributes municipal bond issues for small communities in N ebraska and Iowa. The purchase price was not revealed. Dain Bosworth, a Minneapolis bro kerage firm with an Omaha office, wants to expand its municipal bond services in the Midwest, said Jim Dlugosch, Dain’s executive vice president. “ The newly acquired company enhances our origina tion capabilities and increases our effec tiveness in securing N ebraska bond products for our clients,’’ he said. In 1988, Municipal Bond Underwrit ers, which has been in business for 49 years, had revenue of $1.1 million. Dain Bosworth is operating the firm as a divi sion and retaining the name Municipal Bond Underwriters. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis proval from the Comptroller of the Cur rency and the state of Minnesota to form a full-service broker/dealer subsid iary. The name of the new subsidiary is FBS Investment Services Inc. Nelson D. Civello, executive vice president and head of GMC, was named president. FBS Investm ent Services Inc. will provide retail and institutional invest ment product services across interstate lines, offer investment advice on most products, execute trade orders as well as develop and offer propriety products and services. It also will permit FBS to compete on a more equal footing with banks. Joining FBS Investment Services Inc. is FBS Brokerage Services, a subsidi ary of First Bank System and Central Investment Services of Denver, a sub sidiary of Central Banks, to form one broker/dealer company to serve the Upper Midwest. Both formerly were discount brokerage companies serving FBS and Central Bank custom ers in Minnesota and Colorado. FBS Investment Services Inc. now has a branch office in Denver and even tually will form offices in Milwaukee and other principle FBS markets. Bremer Financial Grows In Eagan Drovers First American Bank opened this month in Eagan. Drovers is a mem ber of the Bremer Financial Corp. The bank occupies 5,000 square feet of a new two-story building near Rahn Road and Cliff Road, a key traffic inter section in the area. The bank offers for lease about the same amount of space on the second floor. The Eagan bank is D rovers F irst American’s third location. In Northern Minnesota, Mike Bodeen’s got you covered. Meet Mike Bodeen, Norwest’s Corre spondent Banker for Northern Minnesota. When you have correspondent banking needs, he’s a good person to know. Mike makes it his business to understand the special needs of commun ity banks. And he wants to do business with © 1988 Norwest Banks you. Talk to Mike about our complete line of specialized correspon dent banking services. When it comes to correspondent banking, he’s got you covered, « iH N O R W E S T B A N K S «^CORRESPONDENT BANKING Member FDIC SEP TEM B ER 23, 1989 Norwest Bank Minnesota, N.A. 29 e NEBRASKA REVIEW Farmer Mac Talk Dominates Ag Credit Conference Nebraska bankers got an earful. And they loved it. At the 15th annual Ag Credit Confer ence Sept. 7-8 in Lincoln, sponsored by the N ebraska B ankers Association, seven speakers addressed nearly 200 bankers over a day and a half of tightlytimed activities. Presentations ranged from somber to zany, from three hours to 45 minutes. One speaker told them glumly: “ You’re not going to like what I have to say.’’ Another said, “ You have to laugh more. Y’all are too serious.’’ Topics varied, too, from Farmer Mac to Nebraska Cornhuskers football. But collectively, they made the same point: In farm lending, there’s never a short age of advice, and there’s always some thing to learn. C om m o d ities s p e c ia lis t R ichard Brock, president of Brock Associates in Milwaukee, was no stranger to many in the audience. Brock’s friendly, casual style and his experience have made him a favorite on the Midwest lecture cir cuit. He advised bankers to create a marketing strategy with every ag bor rower. Both parties in a lending agree ment are better served by mapping a course to profitability than by reacting to sporadic market activity. The highs might not be as high, Brock said, but the lows won’t be as low. He said a marketing plan is the best way to in crease the farmer’s net worth. ‘‘Approximately 75 percent of a pro ducer’s income swings are the result of marketing decisions, not production,” Brock said. “ Many farmers think noth ing about spending an extra $5 per acre on herbicides or fertilizer, but if you ask them to spend 50 cents per acre on marketing they’ll look at you like you have three heads.’’ Producers should spend at least one hour a day on marketing, he said. The banker’s most important role in developing a marketing plan with the farmer is classifying the farmer. Will the farmer play the cash market with stor age, or the cash market without stor age? Will it be strict hedgers this year, selective hedgers or pure speculation? Banker, farmer and spouse should clas sify before the year begins, thereby 30 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cushioning the ride through m arket swings and leaving less to guesswork. “ Only 5 percent of a marketing pro gram is responding to market activity,’’ Brock added. An important benefit of marketing is that it protects against the most danger ous kinds of business decisions: Those made with the heart, not with the head. Brock said farmers too often allow ego, greed, unrealistic expectations, fear and wishful thinking to affect their decision making. At a luncheon, Gov. Kay Orr honored Congresswoman Virginia Smith (R-Nebraska), with the NBA’s recognition award for Smith’s work on agriculture and banking issues. Smith could not at- tend. A.C. “ Skip” Hove Jr., chairman and chief executive officer of the Minden Exchange Bank, and past president of NBA, accepted the award on Smith’s b eh alf. T h e g o v e rn o r said S m ith “ knows the issues and fights for her constituents.” That afternoon, Tom Olson, a mem ber of the Farmer Mac board of direc tors, and president and chief executive officer of Lisco State Bank, gave a brief update on Farmer Mac. The board’s biggest recent achieve ment was finalizing Farmer Mac’s un derwriting standards and submitting them to Congress and to stockholders, Olson said. (About 150 Nebraska banks purchased some of the roughly $20 mil- Below (from left): George Wanitschke, chief executive officer, Bank o f Doniphan; Sam Baird, president-elect, NBA, and presi dent, Farmers State Bank and Trust o f Superior, and Dick Yeshnowski, division manager o f correspondent banking, FirsTier, Omaha. A bove: Tom O lson h o p e s Farmer Mac will be running by November. N e b r a s k a R e v ie w lion in Farmer Mac stock, second in par Klinzing said bankers should put down big,” Klinzing said. And because of the ticipation only to Iowa). their rose-colored glasses for a mo 10 percent subordinated risk, Farmer Olson said the standards were drawn ment. He qualified his remarks about Mac s risk is larger than that in Fannie carefully and deliberately. He said he Farmer Mac’s potential downsides by Mae, for example. hopes they survive intact after scrutiny calling it “ a wonderful idea” whose Banks also run the risk of lender liabil at two oversight hearings scheduled this time has come. ity suits ;n cases of bad loans. Klinzing month in Congress. Already, the Farm But before Farmer Mac pleases his said banks might be forced to foreclose Credit System has claimed the stan palate completely, he said it must over on bad loans sooner under Farmer Mac dards are too liberal, Olson said. Revis come “ hurdles” and “ unknowns.” For because they 11 have poolers to answer ing the standards can be a lengthy proc starters, the gains are shared by many to if too much leniency is granted. And ess and could delay th e sta rtu p of parties: trustees, underwriters, Farmer when a loan goes sour, Klinzing won Farmer Mac, which Olson estimated Mac, the originators and the poolers. ders who will pay foreclosure fees. will occur in November. “ The competition’s spreads aren’t as “ The chances are good that you’ll buy He advised banks to take three steps At right: Vi Schweitzer, presi to prepare for a smooth transition into d e n t, E ric s o n S ta te B an k; Farmer Mac: Richard Wells, president, State • Designate a person in the bank to be Bank o f Bartley, and his wife, come familiar with Farmer Mac and its standards. Nearby banks might share a Ann. person. Each bank could originate loans yet rely on a shared specialist. Develop a list of potential Farm er Mac custom ers. Farm er Mac might provide the vehicle to refinance existing debt, Olson said, “ especially in these times of favorable interest rates.” Cli ents should be matched with the stan dards. Start communicating with certified facilities. Get their thoughts on origina tion fees and other issues. This home work will help banks decide which firm Above: Robert Klinzing. Below: they want to deal with. Also, certified U o f N football coach Tom Os facilities will likely have their own stan borne. dards which should be explained up front. Farm er Mac also was the focus of speaker Robert Klinzing, deputy comp troller with the Office of the Comptrol ler of the Currency in Kansas City. He prefaced his rem arks by cautioning, Above: M otivational speaker Robert “ You’re not going to like what I have to Henry. Below: Jim Nissen, immediate say, but it’s important to tell you any past president, NBA; Mike Jacobson, way.’’ senior vice president, National Bank o f Commerce, Lincoln; and Dick Sull, chief executive officer, Western Bank, A lli ance. Above: Richard Brock from Milwaukee. Above (le ft to right): Tom Jensen, vice president, First Na tional, Omaha; NBA executive vice president Stan Matzke Jr., Lincoln, and Gerry Tomka, vice president, First National, Omaha. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis SEP TEM B ER 23, 1989 31 £ the whole loan back to avoid the risk of incurring bigger, more crippling ex penses associated with bad loans. Klinzing’s prefatory comment was startlingly accurate. His speech did not bring the house down. In the morning, Rusty Jesser, federal legislative representative for the Ameri can Bankers Association, gave an over view of ag issues at the Capitol. Jesser said the most attractive fea ture of Farmer Mac is its potential to bring capital to rural areas, not just in farmland and equipment loans, but in ru ral housing loans and infrastructure im pro v em en ts. “ S e v e n ty -p e rc en t of housing loans in the United States are going through a secondary market,’’ he said. For the first time since 1972, com mercial banks hold more loans than the Farm Credit System, combining shortand long-term loans, he said. Talking about Farm Credit powers, Jesser said, “ We’ll be involved in a knock down, drag out battle with FCS over expanded services for a long time to come at the Congressional level and potentially in the courts.” The issues, for now, are “ on the back burner, he said. “ But the FCS lobbyists are com N ebraska r e v ie w mitted to resuming the battle.’’ Jesser remains hopeful for passage of the 1990 Farm Bill, but he said it isn’t foremost in the minds of legislators. One reason is that only 80 of 435 mem bers of Congress are from rural dis tr ic ts , and th a t n u m b er could be trim m ed to 60 after redistricting in 1992, he added. Howard Olsen Jr., chair of the house of delegation for the NBA, and a partner in the Scottsbluff law firm of Simmons, Raymond, Olsen, Ediger, Selzer & Ballew, talked about lender liability cases landing in court. Olsen has been involved in nine. H e’s seen first-hand the many ways borrow ers can bring their banker to the court room, from breach of fiduciary duty, breach of contract, breach of covenant or good faith, misrepresentation, and negligence. He gave several points on how to avoid lawsuits. • Sm art b ankers take safeguards. Chief among them is communication. “ Document everything,” Olson said. “ Even off-hand opinions.” Make sure the documentation is accurate. • Get the borrower’s written acknowl edgment of discussions. • Don’t be secretive. “ The borrower should know everything the lender does about his case.” • Consider using legal counsel and rec ommend same to the borrower, espe cially in complicated transactions. • Get a third party’s review of the agreement. • Lastly, he said, be professional. After a heady discussion of legal impli cations of farm lending, the topic was avoided altogether by the final speaker, Tom Osborne, coach of the University of Nebraska Cornhuskers football team. After bemoaning the loss of several Big Eight players to graduation, Osborne bemoaned the plight of young people as he sees it while traveling the country recruiting players. Osborne said the absence of positive adult role models in many families, es pecially fathers, is a major reason why so many kids turn to alcohol, which he sees as a bigger drug problem than co caine or other illegal substances that get more attention. by Jody Olson Teamwork At Saline Bank Wins Float Prize Using the theme “ Down By the Old Mill,’’ the float constructed by the staff of the Saline State Bank in Wilber, N eb., won the sweepstakes prize both days during the recent 28th Czech Days F es tival in Wilber, the self-proclaim ed Czech capital of the nation. Harley D. Bergmeyer, president of Saline State Bank, said all employees of the bank help build a float each year at his home near Wilber. He said the focal point for local activities in past years frequently was the Old Mill, which ground grain from area farms, giving rise to this year’s float concept. This year’s float featured a miniature water wheel from the Old Mill identical to the massive wheel that churned un der water pressure for many years. The upright mill house at the front end of the float contained a small Homelite gaso line-powered pump Bergmeyer uses at home to pump pond water to his trees. While a local barbershop q u artet 32 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis dressed in 1900 garb stood on the min iature white bridge at the back of the float singing “ Down By The Old Mill Stream,” several bank employees and their children sat around on the float “ fishing” in the pond contained in the base of the float. At the back end of the loat an old gent in overalls and straw iat relaxed sound asleep in his rocking * ^ chair, with shovel lying across his lap. Bergmeyer’s penchant for nostalgia and antiques extends to his own farm, where he has restored to mint condition the 75-year-old granary, complete with an old wagon, and its elevator driven by a portable steam engine. He also has re stored the nearby windmill which now waters all the livestock on his farm. Harley D. Bergmeyer, president and chief ex ecutive officer, Saline S ta te B ank, W ilber, Neb., stands beside a flo a t constructed by bank s ta ff th a t won the sweepstakes prize a t th e re c e n t 2 8 th Czech Days Festival in Wilber. N ebra sk a r e v ie w NBA Attracts Crowds To Six Area Banker Meetings The Nebraska Bankers Association recently held six area banker meetings across the state to bring NBA members up to date on the association’s activities and to discuss issues of common inter est. More than 700 bankers attended this year’s annual program. Bankers m et in Omaha, B eatrice, Norfolk, Scottsbluff, North Platte and Grand Island. All of the programs began with a briefing by Jim Nissen, NBA president and president, Vistar Bank, Lincoln, followed by a federal and state legislative update by Bob Hallstrom, as sociate legal counsel, NBA. Information about the NBA’s health plan was pre sented by Bill Osterberg. Nissen provided updated figures on Nebraska banks. Four hundred banks serve the state, employing 10,800 peo ple. They have more than $17.4 billion in assets with a primary capital to assets ratio of 9.44 percent - the seventhhighest in the United States. Return on assets for the first quarter of 1989 was 1.27 percent, the sixth-highest. Nissen told the audience, “ NBA’s pri mary focus is in three areas: banker ed ucation, banker information and legisla tive representation - probably the most important activity we perform.’’ Addressing the Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA), Nissen said, “ Last year at this time we had no idea what kind of bill would be put forth and we feared Congress might just throw more money at the problem. While the final bill may not be perfect, we believe it is sound in most respects. ‘‘We think it’s very important that we maintain a presence in Washington, At le ft: Enjoying the reception are (from le ft) Gerry Tompka, First National Bank o f Omaha; Edwin Sasse, Farmers Bank & Trust, Nebraska City; and Arvon Marcotte, also with Farmers. D.C., and that we are able to personally represent Nebraska’s banks when the need arises.’’ He noted the success of the recent Washington visit and testi mony before the Farm Credit Adminis tration on expanded services for FCS banks. Nissen made special mention of the fu tu re issu e s task fo rce, which is charged with reviewing major environ mental changes that might impact the future of the NBA. The task force is chaired by Bill Smith, recently retired president of Firs Tier. Another task force, the centennial task force, has been formed in conjunc tion with the NBA’s 100th birthday, Jan. 22, to be celebrated at next year’s con vention. The task force has commis sioned Ben Haller, publisher emeritus of Northwestern F inancial Review, to write the NBA’s 100th anniversary his tory book of Nebraska banking. Bob H allstrom , associate general counsel for the NBA, gave a federal and state legislative update. On the federal side, Hallstrom noted a number of is sues facing bankers: the Farm Credit System, credit union taxation and struc ture, Chapter 12 filings and compliance issues. Looking at state issues, Hallstrom said, “ 1989 was a mild session. NBA was successful with five of seven bills passing.’’ He cautioned bankers to watch LB606, dealing with lender liabil ity; LB289, L.U.S.T. bill; and LB529, bank insurance powers. Hallstrom con cluded, “ We don’t have a m assive agenda for the 1990 session, but we will look at lending limits and tax exemp tions.’’ A reception followed each meeting. Dinner and entertainment concluded the sessions. The after-dinner speaker was Nebraska historian Robert Manley, tell ing tales of old Nebraska and challenging bankers to “ pursue a vision for Ne braska.’’ by Robert Cronin Discussing the preceding meetings are (below, from left): Alan Loos, National Bank o f Com merce, Lincoln; and Jim Lutes, Scribner Bank. Pictured below (from left): Jim McBride, ABA represent ative, Nebraska; Jim Nissen, immediate past president, NBA; Larry O’Meara, Higher Education Asst. Foundation, Lincoln; and Gene Tschida, Bank o f Nebraska, La Vista. ¿ a ..* * Above, from le ft: Bob Zaback, Norwest Bank Nebraska, Omaha; C.L. Landen, Security National Bank, Omaha; Jerry Roe, Bank o f Ben nington; and Wally Landon, Norwest Bank Nebraska, Omaha. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis SEP TEM B ER 23, 1989 33 WISCONSIN REVIEW o Firstar Acquires Valley Bancorp Plans De Novo Bank Park Forest Subsidiary full range of banking and non-traditional Valley Bancorp, Appleton, plans to start a de novo bank in southwest sub urban Milwaukee. The de novo bank would join 10 Valley offices in nearby suburban locations. Currently in the process of site selec tion, Valley is expected to be in business by spring 1990. The bank is to offer a financial services. The company ex pects to add more branches in the mar ket. Named president and chief executive officer of the new facility was Dominic A. Forgianni, previously with the Edgewood Bank. Banks In Clear Lake, Amery Change Names PERSONNEL Bank of Clear Lake and its branch in Amery changed their names to Land mark Bank. Bank of Clear Lake has been in con tinuous operation in Polk County since 1903. The bank recently purchased property in Hudson for a new office. Subject to regulatory approval, the Hudson branch is scheduled to open early next year. The Federal Reserve Bank of Chi cago has appointed Anthony J. (Tom) Tempelman assistant vice president in charge of its regional office in Milwaukee. Tempelman replaces assistant vice president Charles M. Lund, who was named head of the Bank’s Chicago check processing operations. Tempelman joined the Chicago Fed in 1982 and was an account executive in custom er relations before moving to electronic services as sales manager for I large accounts in 1988. He also has 18 © 1988 Norwest Banks Member FDIC https://fraser.stlouisfed.org iRTHWESTERN FINANCIAL REVIEW Federal Reserve Bank of St. Louis years experience working in commer cial banking. Tempelman is a bachelor’s degree can d id ate at E lm h u rst C ollege in Elmhurst, 111., and a graduate of the Prochnow Graduate School of Banking at the University of Wisconsin. Robert W. Klockars has joined the Grad uate School of Banking as director of its Prochnow educational foundation. Previously, Klockars worked at Clay ton Brown & Associates Inc., a Chi cago-based investm ent banking firm, and Financial Shares Corp., a public re lations and training consulting firm in Chicago. The foundation, located in Madison, was established in 1983 to support re search of interest and use to bankers, to develop special educational programs and to provide banking educational op portunities for college faculty and media representatives. Klockars was a community banker for 14 y e a rs at H om e S ta te B ank of M cPherson, Kan., and the Farm ers State Bank in Lindsborg, Kan. In addition, Klockars served as one of 21 banking advisors selected by the American Bankers Association from 1981 to 1983. Klockars has been a fac ulty member at the Graduate School of _ you. Talk to Bill about Banking and the Bank Marketing Asso our complete line of specialized correspon ciation Trust School at the University of dent banking services. When it comes Colorado, Boulder. to correspondent banking, he’s got you He is a graduate of McPherson Col covered. lege, M cPherson, Kan., and of the U tilN O R W E S T B A N K S NORWEST Graduate School of Banking. mmmmm mmimm CORRESPONDENT BANKING In Wisconsin, Bill Meyer’s got youcovered. 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 Firstar Corp. of Milwaukee agreed to acquire Park Forest Holdings Inc., a one-bank holding company in Park For est, 111. Upon completion of the sale, Park Forest’s subsidiary bank will be come the fourth Firstar bank in Illinois. Terms of the transaction were not dis closed. Norwest Bank Minnesota, N.A. CLASSIFIED ADS HELP WANTED HELP WANTED SENIOR LENDER Medium sized ag bank seeks ag/comm’l officer for sr mgmt role. M ust have 5 + yrs banking exp with some mgmt resp. Sal to $40K. Job #NFR5232 COMMERCIAL LENDING $115MM independent comm’l lender to be groomed for sr mgmt resp. Must have 5 + yrs solid comm’l exp. Workout exp helpful. Sal to mid $ 4 0 ’s. Job #NFR5233 COMMERCIAL LENDER Need a challenge? 2 + yrs line lending exp desired for G reater MN bank. Mgmt potential! Sal to $35K. Job #NFR5234 CASHIER Make the move! 3 + yrs operations with hands-on call and board reports, computer skills. Sal to $30K fob #NFR5235 R/E OFFICER A true growth oppty! 1 + yrs mortgage lending, some bank exp. Sal to $26K. Job #NFR5236 CALL P. LUTHER LaSALLE OR PAUL BEES AT (612) 339-9001 s ROBERT HALF OF MINNESOTA, IMG. 2800 N orwest C enter Minneapolis, MN 55402 (612) 339-9001 ALL FEES COMPANY PAID PARTIAL LISTING OF AVAILABLE POSITIONS AG LENDER - manage ag lending function and assist in other lending areas in a $50MM bank. $25K COMMERCIAL LOAN - 3 yrs. commercial lending experi ence and formal credit analysis training needed. $40K PERSONAL TRUST - minimum 3 yrs. personal trust experi ence. Requires J.D. degree. $38K CREDIT ANALYST - degree and 1-2 yrs. experience re quired. Urban bank. * $22K AUDITOR - minimum 2 yrs. bank auditing experience. Accounting degree required. $23K Resume and salary history requested. All inquiries confidential. AG LENDER Expanding organization seeks ag lender with 2 + yrs exp. Are you energetic, articulate and able to work with minimum supervision? L et’s talk. $27K. ASST M G R -C O N S U M ER LENDING Des Moines institution is looking for someone with 1 + yrs consumer lending exp. $20K. ALL FEES COMPANY PAID FOR MORE INFORMATION CONTACT RANDY ROCK AT 515-244-4414 OO n ÎoOO SM 3 1 7 6th Ave., Ste. 700 Des Moines, IA 50309 ® OPERATIONS OFFICER Immediate opening for operations officer in $25MM north central Minn bank. Minimum of 3 years experi ence in bank operations required. Competitive salary and benefits. Send resume and salary history in confi dence to File #9599 c/o N orthw estern Financial ReImmediate opening for head cashier/operations officer in $15MM central Minn bank. Computer skills a must. Send resume and salary requirements to File #9600 c/ o N orthwestern Financial Review. COMMERCIAL LENDING OFFICER Kenosha Savings and Loan, a Southeastern Wisconsin financial institution currently ranked as one of the top 32 performing thrifts, is seeking an experienced com mercial loan person. The qualified candidate for this upper middle manage ment position will have 3-5 years commercial lending experience. Business development skills are a must. We will offer the right candidate a very competitive starting salary, a comprehensive benefit package and the opportunity to work for a well-run, growing finan cial institution. Qualified candidates please send resume, application letter and salary requirements to: Kenosha Savings and Loan ATTN: Personnel Manager 4235 52nd Street Kenosha, WI 53142 Equal Opportunity Employer 515-244-4414 AG LOAN OFFICER Immediate opening for ag loan officer with experience in credit analysis and some operations. M ust be com puter oriented. Clean $14MM bank in NE Nebraska Send resume to File #9591 c/o N orthw estern Finan cial Review. B A N K IN G BANK MANAGER Manager for new bank in Twin Cities area. Successful applicant will possess strong business development skills and have high visibility in the business commu nity. Submit resume and salary requirements to File #9595 c/o Northwestern Financial Review. MARKETING OFFICER Good public relations and minimum three years’ expe rience marketing bank products and services are quali fications required for this new position in the Twin Cit ies. Submit resume and salary requirements to File #9596 c/o Northw estern Financial Review. TOM HAGAN & ASSOCIATES P O . Box 12346/2024 Swift North Kansas City, MO 64116 816/474-6874 “ Serving the Banking Industry Since 1970” TRUST DEPT HEAD Great job! Great co! Run this dept your way. If you want to contribute to a growing dept, h e re ’s the job $40’s. HELP WANTED POSITIONS AVAILABLE FOR SALE C O M PL ET E KENW OOD M OBILE BANKING UNIT suitable for branch or temporary facility. For info contact: Junction State Bank, Junction City WI 54443, (715)457-2921. One Burroughs A9249-1 Printer (100 lines per min.). One Burroughs 201 - 18mg fixed disc drive. Best Offer. Viking Savings Association, P.O. Box 966 Alexandria, MN 56308; (612) 762-0236 For immediate sale: Burroughs L9000 Posting-Proof Machine series L9500. Also a Bell-Howell “ Micro copy 15 com” micro reader/printer. Contact Jeff at 712-647-2301 New and Used: vault doors, drive-ups, night deposito ries and money safes. Expert installation and service. Security Products (612) 784-6504. MISCELLANEOUS Architectural services; site planning; space planning; modular bank buildings; portable drive-up units for sale or lease. Les H. Liptak, Inland Safe Co. Inc., (715) 832-6866. Eau Claire, WI. WE BUY/SELL/LEASE USED BANK EQUIPMENT IBM, NCR, UNISYS & MOST OTHERS COMMERCIAL LOAN OFFICER $200 million dollar aggressive w estern Wisconsin bank. Minimum of three years prior commercial lend ing experience or completion of a commercial loan training program. Four year finance or accounting de gree preferred. Excellent salary and fringe benefits. Send resume and salary requirements to File #9601 c/ o Northw estern Financial Review. 'Professional assistance in hiring and career advancement" CALL FOR COMPETITIVE PRICES Ba nksystems Mountain States Arno Troff (801) 261-6456 Midwest States Dan or Brad (612) 881-4050 Fax (612) 881-2633 quality service by experienced professionals 525 Merle Hay Tower Des Moines, Iowa 50310 515-276-1151 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Jean Eden 515-276-1151 Sandi Garner 515-832-1258 Tues / Wed / Fri Confidential. Fees Paid by Employer. Customer Rated #1 = — ■- - = = = = - = . Member: = - = — Computer Dealers = = = : & Lessors Association SEP TEM B ER 23,1989 35 B u s in e s s M a r k e t p l a c e BANK CONSULTANTS BANK ARCHITECTS ACCOUNTANTS (612) 893-6604 Kevin M . Murphy MICHAEL L. ANDERSON, C.P.A. TAX. AUDIT AND CONSULTING SERVICES A LE X A N D R IA . M N 5 6 3 0 8 • (612) 7 6 3 - 3 1 5 7 E M M E T S B U R G , IA 5 0 5 3 6 • (712) 8 5 2 - 4 4 6 4 Bank Consultant BWBR ARCHITECTS 3600 West 80th Street Suite 125 Bloomington, MN 55431 Bergquist Rohkohl Johnson Sleiter St. Paul, MN (612) 222-3701 __ L A R S O N ___ ____ A L L E N . _ W E IS H A IR ___ _____ & CO . __ L A R S O N ___ ____ A L L E N . J W E IS H A IR ___ ______«fe CO . 12221 Wood Lake Drive Burnsville, M innesota 55337 Phone: (612) 894-5751 CERTIFIED PUBLIC ACCOUNTANTS & BUSINESS CONSULTANTS DAVID L. GRANDE, CMC THOMAS D. JACOBSON THOMAS B. WILLIAMS, CPA 650 INTERNATIONAL CENTRE II 920 SECOND AVENUE SOUTH MINNEAPOLIS, MN 55402 T E R R Y A. E N G E R , C PA (612) 337-7000 500 ZAPP BANK PLAZA 1015 ST. GERMAIN ST. CLOUD, MN 56301 D E N N IS J. Z A U N , C PA R IC H A R D W . N IL S O N , C P A (612) 253-8616 Brent A nderson A ssoc., Inc. Architects/Engineers Contact CHARLES A. DYKINS PHILIP BLASKO, A.I.A. 650 INTERNATIONAL CENTRE II 920 SECOND AVENUE SOUTH MINNEAPOLIS, MN 55402 (612) 337-7000 David R. Peltz & C ompany, p.c ., ltd . D Certified Public Accountants______________ Doane Financial Services Company 1740 Bell School Road Cherry Valley, IL 61016 800-243-6263 DOANE DAVID R. PELTZ 2 0 6 N O R T H FIR ST ST M IN N E A P O L IS . M IN N President 5 5 40 1 ( 6 1 2 ) 0 3 9 3 7 5 2 First Interstate Center 401 N. 31 st Street, Suite 590 P.O. Box 7156 Billings, MT 59103 (406) 259-2477 3140 Harbor Lane, Suite 130 P.O. Box 41830 Minneapolis, MN 55441 (612)553-1925 S pe cia lists in a ss is tin g ru ra l banks • portfolio reviews • training • problem loan help • loan review • risk grading J ACK BOARMAH BOARMAN& ASSOCIATES BANK INTERIORS A C C O U N TA N TS A ND A U D ITO R S 1 0 8 0 0 C O U N TY ROAD 1 M IN N E A P O LIS . M IN TE R IO R S F IN A N C IA L C H A R LE S H. P R E S TO N CO., P.A. m RICHARD HANDFORD AND ASSO CIATES, LTD. ARCHITECTURAL SERVICES JMmUoLlGlJDUOl Design and Purchasing Services for Commercial Interiors '• '. I JACK CHRISTENSON (612) 949-2866 Richard W. Handford Architect 300 Liberty Bank Building St. Paul, Minnesota 55104 176 No Snelling Ave. (612)645-4263 15411 VILLAGE WOODS DR., EDEN PRAIRIE, MN 55344 ACCOUNTS RECEIVABLE FINANCING BANK NOTE COMPANIES OF MINNESOTA Purchasers of Accounts Receivable Throughout fheU.S. BILL STAPEL B u s in e s s D e v e lo p m e n t M a n a g e r [e — HICKEY. THO RSTENSON, GROVER, LTD A R C H I T E C T S 6 9 5 0 F ra n c e A v e n u e S o u th E d in a . M N Engravers & P rinters of Stocks and Bonds 55435 980 1 D u p o n t A v e n u e S o u th . S u ite 185 B lo o m in g to n . M in n e s o ta 55431 (6 1 2 ) 8 8 1 -6 4 3 4 M ID W E S T JON P T H O R S T E N S O N ARCHITECT BANK NO TE COM PANY (6 1 2 )9 2 0 -1 8 8 1 J M IC H A E L LOY ACQUISITION CONSULTING DALE L. KURTZ __ L A R S O N ___ ____ A L L E N ___ J W E IS H A IR _____ & C O ___ _ . . i n D A K in C r 'I U lO DAVID L. GRANDE, CMC (612) 337-7000 DENNIS J. ZAUN, CPA (612) 253-8616 650 INTERNATIONAL CENTRE I. 920IsShCUNU e c o n d aAVfclNUt v e n u e sov-«u o u tihn MINNEAPOLIS, MN 55402 --------------500 ZAPP BANK PLAZA 1015 ST. GERMAIN ST. CLOUD, MN 56301 36 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis JA C K S O N - JA C K S O N & A S S O C IA T E S , a r c h i t e c t s 1905 North 81 Street Omaha, Nebraska DIRECTOR OF MARKETING inc ENGINEERS 68114 402-391-3999 D om H E R T Y PW Y K IN S PORTFOLIO ADVISORY SERVICES. INC. 111 III w JACK H. JACKSON, AIA PRESIDENT REGISTERED ARCHITECT w I I H ill INSIDE MN: 800 652-0204 OUTSIDE MN: SOO-328 4085 100 SOUTH FIFTH CTREET SUITE 2300 MINNEAPOLIS. MINNESOTA S5402 612-341-6000 B u s in e s s M a r k e t p l a c e BANK NOTE COMPANIES COMPUTERS Compensation Continued from page 15 m TEXAS IN S T R U M E N TS C O M PU T ER S WINDSOR FINANCIAL GROUP River R idge S e rvice C e n te r 1 2 3 7 6 R iver R idge B o ule vard B u rn sville , M in n e so ta 5 5 3 3 7 8400 NORMANQALE LAKE BOULEVARD. SUITE 1450 M INNEAPOLIS. MINNESOTA 55457 612-835-2220 Robert J. DeBenedet, CFA VtcePresident R o n a ld L. In g e ra o ll P resid en t BANK VALUATIONS COMPUTER SERVICES travel agent for computers ” D.G. PARTRIDGE David R. Christenson Principal President 712-673-2354 000-831-0030 107 Mam p o . Box 23 Breda, Iowa 51436 A Q _ 4008 Xerxes Avenue North M in ^ P o lis . Minnesota 55412 D c i r K J O n Bank Consulting &Advisory Services Telephone & Fax (612) 588-4043 COMPUTER TRANSPORTATION SERVICES, LTD, S pecializing in the transp o rtatio n of ATM s and data processing equipm ent EQUIPMENT LEASING COM M ERCE f i n a n c i a l D A V ID L. G R A N D E , C M C 650 INTERNATIONAL CENTRE II 920 SECOND AVENUE SOUTH MINNEAPOLIS, MN 55402 (612)3 3 7 -7 0 0 0 MEMBER, INSTITUTE OF BUSINESS APPRAISERS ( Tr o u p T iT a James E Senske President D E N N IS J. Z A U N , C P A 500 ZAPP BANK PLAZA 1015 ST. GERMAIN ST. CLOUD, MN 56301 (612) 253-8616 Cmnmeree Leasing Corporation • Commerce M ortgage Company 8400 N orm andale Lake Blvd • Suite 920 • Minneapolis, MN 55437 _______________ 612/921-2376 • FAX 612/921-2309 Northland Bank Investments LEGAL COUNSEL Appraisals - Sales — Consulting Adina M. Overbee President P.O. Box 3 5 5 1 3 C u r t in and B a r n e s ATTORNEYS AT LAW M in n eap o lis, MN 5 5 4 3 5 MARY E. CURTIN SUSAN E. BARNES CHRISTINE L. MEUERS 45 ™ T (612) 337-5445 MINNEAPOLIS, MN 55402 shares granted, the allocation of stock options to individual directors, the grant price of stock options, the number of years over which a director may exer cise an option, any terms or conditions pertaining to the grants, the manner of exercise and payment for stock options, and the effect of the dissolution, mer ger, or consolidation of the financial in stitution on stock options granted. In addition, a frequently encountered problem concerning the exercise of stock options involves providing direc tors with the means to finance purchase of the option shares and pay the associ ated tax liability at that time. Special compensation techniques are available in the design of a stock option plan which help to eliminate any financing problems inherent in a stock aquisition program. A stock option plan may pro vide for stock appreciatio n rig h ts (SARs), stock swaps or stock pyramid ing in order to assist a director in financ ing the purchase of option shares. Stock appreciation rights entitle a di rector to a cash payment based on the appreciation in the prices of the institu tion’s stock. SARs are frequently issued in tandem with non-satutory stock op tions and must be exercised at the same time as options. These three financing techniques will have specific tax and fi nancial reporting consequences to the institution which must be fully explored before utilizing such techniques. Sum m ary Paul W PERSONNEL O la n d e r Company 507-285-9271 1073 PLUMMER LANE S W • ROCHESTER. MINNESOTA 55902 Providing Services fo r Banks, Bank Owners and Directors. COMPUTERfTELLER EQUIPMENT I COMPUTER SALES, INC._________ 3947 Excelsior Boulevard. Suite 103 Minneapolis, Minnesota 55416 (612)922-2249 FAX: (612) 922-9315 Specializing in the purchase and resale of IBM 4700, 3600, System 36 & System 38 hardware. https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis 1 B a n k S p e c ia lis ts Paul B ees, Paul G e n tzk o w , P. L u th e r L a S a lle 2800 Norwest Center Minneapolis, MN 55402 (612) 339-9001 FAX (612) 349-6769 World s largest banking, accounting, financial and DP personnel specialists Reach 31,000 readers by listing your business and professional services. Economically. Efficiently. Call (612) 854-2177 to reserve your space. As financial institutions move into the 1990s, no single director compensation vehicle will attract, motivate, and retain competent and effective directors. A proper mix of current compensation, long-term incentives and perquisites are needed. Future tax, accounting or other regulatory changes could affect the type and quantity of compensation plans of fered to directors. Thus, a board’s com pensation committee must constantly monitor the tax, accounting and regula tory environment to ensure that the in stitution’s director of compensation pro grams offers the best cost/benefit mix to both the institution and its directors.■ SEPTEMBER 23, 1989 37 SNAPSHOT Beer, Hoagies, Annuities Mix he idea was so sim p le ,” sa y s M ark Pingrey, nearly gig gling, “ that it was stupid.’’ But Pingrey, president of Farm ers and Mechanics Bank in Galesburg, 111., is glad to report the stupid idea has made F&M look pretty darned smart. F&M recently opened the first fullservice bank in an Illinois grocery store, in this case Eagle Foods on the city s main thoroughfare. Though he won t specify how many accounts have been opened in this city of 35,000, he did say activity has been much higher than ex pected. “ They’ll run their grocery carts right up to the teller window. True story: Our first loan customer came in at 6 p.m., carrying a loaf of bread under one arm and a gallon of milk under the other. He said, T didn’t think I ’d ever do this, but I want to apply for a loan.’ And he sat down with his bread and milk.’’ During one late-night prom otion, when the bank opened “ on a lark at 10 p.m. on a Friday, customers were buy ing CDs until 12:30 a.m., Pingrey says. That promotion coincided with one of fered by Eagle featuring eggs for 24 cents a dozen. Eagle and F&M have teamed for other incentives, too. F&M T 38 NORTHWESTERN FINANCIAL REVIEW https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis gave free liters of Pepsi for every de posit of $100 or more. Buyers of CDs worth at least $5,000 received $20 Ea gle gift certificates. And the first two weeks it was open, F&M ran its own incentives. The first week —free check ing, the next - half-price tra v e le rs checks and a free six-month Club ac count. The bank is located between the deli and the beer, and occupies 1,00 square feet, about twice the space of an aver age grocery store branch, Pingrey says. Fully carpeted, decorated and oak pan eled, the bank is certain to catch the eye of anyone looking for a hoagie or a sixpack. There is no outside door to the bank. “ We wanted to take advantage of all the people buying bread and milk,’’ Pingrey says. “ Once they re in the store, they ’re in the bank.’’ Ken Martin, senior vice president of marketing for Eagle Food Centers, calls the arrangement “ a nice marriage for both parties.’’ Martin says the F&M bank is the first full-service facility in any of its 106 stores in Illinois, Iowa and Indiana. “ We’re trying to project the image of one-stop shopping. You can buy your fresh yogurt here and open a checking account,’’ Martin says. “ We have ATMs in all of our stores, but they can offer the customer only so much.’’ F&M’s main bank, which has assets of $72 million, employs 35 and is located across town. The Eagle location offers everything the main bank does, except safe deposit boxes - and its own door. Otherwise, it’s business as usual for the four full-time and one part-time employ ees at the Eagle facility. Loans, annui ties, CDs, savings accounts, travelers checks, loans for real estate, consumer loans and home mortgages are on the menu. The grocery store is open 24 hours a day. The Eagle bank has ex tended weekday hours and is open Sat urdays from 9 a.m. to 5 p.m. and from 1 0 a.m. to 4 p.m. Sundays. Business has been “ fairly brisk’’ on Saturdays and “ surprisingly brisk’’ on Sundays, Pingrey says. “ When the gro cery store is busy, we are; when they aren’t, we aren’t.’’ He says this stupid idea makes all too much sense. “ Everybody buys groceries on a reg ular basis, and you don’t buy them out of town. You’ll probably shop the same store. You also do your banking every week. Why not do it at the same time, same spot?’’ H by Jody Olson M u n ic ip a l f in a n c e LEGAL NOTICE MUNICIPAL BOND CALENDAR TIME AMOUNT 11:00 a.m. 930,000 11:00 a.m. 1.490,000 3:00 p.m. 5,000,000 4:00 p.m. 1,940,000 10:30 a.m. 20,785,000 10:30 a.m. 22,300,000 11:00 a.m. 1,440,000 OFFICIAL NOTICE OF SALE STEARNS COUNTY, MINNESOTA $7,310,000 GENERAL OBLIGATION CAPITAL IMPROVEMENT BONDS OF 1989 PUB’D NFR ISSUER September 25-30 Monday Tuesday Wednesday Mounds View, MN (G.O. Tax Increment Bonds, Series 1989B) Mounds View, MN (Taxable G.O. Tax Increment Bonds, Series 1989C) International Falls, MN (G.O. Tax Increment Water Plant Bonds of 1989) Worthington, MN (G.O. Sewer Revenue Bonds, Series 1989A) Minneapolis, MN (Nicollet Mall Improvement Bonds) Minneapolis, MN (Convention Center Related Facility Bonds) Minnesota Higher Education Facilities Authority (Gustavus Adolphus College, Mortgage Revenue Bonds, Series Two-V) Sept. 9 Sept. 9 Sept. 9 Sept. 9 Sept. 16 Sept. 16 Sept. 16 October 2-7 Monday 7:00p.m . 575,000 Tuesday 11:00 a.m. 1,965,000 11:00 a.m. 1,635,000 3:00 p.m. 580,000 LaCrescent, MN (G.O. Wastewater Treatment Bonds, Series 1989) Shakopee, MN (G.O. Tax Increment Bonds, Series 1989A) Shakopee, MN (G.O. Tax Increment Bonds, Series 1989B) Detroit Lakes, MN (G.O. Improvement Bonds of 1989) Sept. 23 Stearns County, MN (G.O. Capital Improvement Bonds of 1989) Forest Lake, MN (Taxable G.O. Tax Increment Bonds of 1989, Series B) Sept. 16 Nicollet County, MN (G.O. Capital Improvement Bonds, Series 1989) Sept. 23 Sept. 23 Sept. 23 Sept. 23 October 9-14 Tuesday Wednesday 11:00 a.m. 7,310,000 3:00 p.m. 275,000 Sept. 23 October 16-21 Tuesday 10:30 a.m. 1,740,000 LEGAL NOTICE NOTICE OF CALL FOR REDEMPTION $200,000 MUNICIPAL BUILDING REVENUE BONDS OF 1984, SERIES B CITY OF SPRING LAKE PARK ANOKA AND RAMSEY COUNTIES MINNESOTA NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Spring Lake Park, Anoka and Ramsey Counties, Minnesota, there have been called for redemption and prepayment on December 1, 1989 outstanding bonds of the City designated as Municipal Building Revenue Bonds of 1984, Series B, dated Oc tober 1, 1984, having stated maturity dates in the years 1990 through 1993, and totaling $110,000 in principal amount. The bonds are being called at a price of par (plus a premium of one percent (1.00%) of par per bond called) plus accrued interest to December 1, 1989, on which date all interest on said bonds will https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis cease to accrue. Holders of the bonds hereby called for redemption are requested to present their bonds for payment at First Trust National Association (for merly, First Trust Company of Saint Paul), First Trust Center, Corporate Trust Department, 180 East Fifth Street, Third Floor, in St. Paul, Minnesota 55101, on or before December 1, 1989. Dated: August 21, 1989. BY ORDER OF THE CITY COUNCIL Donald Busch City Clerk-Treasurer Additional information may be obtained from: JURAN & MOODY, INC., Minnesota Mutual Life Building, 400 North Robert Street, Suite 800, St. Paul, Minne sota 55101-2091: Telephone No.: (612) 224-1500. Juran & Moody, Inc. (612) 224-1500 Published in N orthwestern Financial Review September 23, 1989 NOT ICE IS HEREBY GIVEN that sealed bids for the purchase of $7,310,000 General Obligation Capital Im provement Bonds of 1989 (hereinafter referred to as the "B onds” ) will be received until 11:00 a.m., Cen tral Time, on the 10th day of October, 1989, at Stearns County Courthouse, St. Cloud, Minnesota, at which time any bids received will be opened and tabulated. Bids of not less than $7,200,350 plus ac crued interest on the total principal amount of the Bonds will be accepted for the Bonds. The bids will be considered and acted upon by the Board of Commis sioners of the County at a meeting of the Board at 1:00 p.m., Central Time on October 10, 1989. The County reserves the right to reject all bids and not offer the Bonds for sale. The Bonds will be issued as fully registered bonds in denominations of $5,000, or any authorized integral multiple thereof, will be dated October 1, 1989 and will mature serially on October 1 in the following years and amounts: Year Amount Year Amount 1991 $205,000 2001 $385,000 1992 215,000 2002 410,000 1993 230,000 2003 435,000 1994 245,000 2004 470,000 1995 260,000 2005 500,000 1996 280,000 2006 535,000 1997 295,000 2007 570,000 1998 315,000 2008 610,000 1999 335,000 2009 655,000 2000 360,000 Interest will be payable on October 1, 1990, and semiannually on each April 1 and October 1 thereafter. Bonds maturing on or after October 1, 1999 shall be subject to redemption and prepayment on October 1, 1998 and any interest payment date thereafter at a price equal to par plus accrued interest. An approving legal opinion for the Bonds will be fur nished by Holmes & Graven, Chartered, of Minneapo lis, Minnesota. Copies of the detailed Official Terms of Bond Sale and additional information for the Bonds may be obtained from the undersigned or from the fi nancial consultants of the County: MILLER & SCHROEDER FINANCIAL, INC., N orthw estern Finan cial Center, 7900 Xerxes Avenue South, P.O. Box 789, Minneapolis, Minnesota 55440; Telephone: (612) 831-1500. Dated: September 23, 1989 BY ORDER OF THE BOARD OF COMMISSIONERS OF STEARNS COUNTY, MINNESOTA By Henry J. Kohorst County Auditor Miller & Schroeder Financial, Inc. N o rth w estern Financial C en ter 7900 Xerxes A venue S outh P .O . Box 789 M in n eap o lis, M innesota 55431 Published in Northwestern Financial Review September 23, 1989 SEPTEMBER 23, 1989 39 M u n ic ip a l LEGAL NOTICE NOTICE OF BOND SALE $1,965,000 GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 1989A CITY OF SHAKOPEE, MINNESOTA NOTICE IS HEREBY GIVEN that the City of Shakopee, Minnesota, will receive sealed bids for the pur chase of $1,965,000 General Obligation Tax Incre ment Bonds, Series 1989A, of the City (the Bonds), until 11:00 A .M ., Central Time, on Tuesday, October 3,1989, at the offices of Springsted Incorporated, 85 East Sev enth Place, Suite 100, St. Paul, Minnesota 551012143 at which time the bids will be opened and tabu lated for presentation to the City Council for action thereon at a meeting to be held at the City Hall at 7:30 P.M. on the same day. No bid submitted may be with drawn before the Council meeting. The Bonds will be issued for the purpose of financing costs to be incurred by the City in aid of its Minnesota River Valley Rede velopment District No. 1. The Bonds will be issuable as fully registered bonds, in denominations of $5,000 or any integral multiple thereof, will be dated, as origi nally issued, as of November 1, 1989, and will mature on February 1 in the following years and amounts: Amount Year Year V Â City Council of the City of Spring Lake Park, Anoka and Ramsey Counties, Minnesota, there have been called for redemption and prepayment on December 1,1989 outstanding bonds of the City designated as Municipal Building Revenue Bonds of 1984, dated June 1, 1984, having stated maturity dates in the years 1990 through 1993, and totaling $165,000 in principal amount. The bonds are being called at a price of par (plus a premium of one and one-half percent (1.50%) of par per bond called) plus accrued interest to December 1, 1989, on which date all interest on said bonds will cease to ac crue. Holders of the bonds hereby called for redemp tion are requested to present their bonds for payment at First Trust National Association (formerly, First Trust Company of Saint Paul), First Trust Center, Corporate Trust Department, 180 East Fifth Street, Third Floor, in St. Paul, Minnesota 55101, on or be fore December 1,1989. Dated: August 21,1989. BY ORDER OF THE CITY COUNCIL Donald Busch City Clerk-Treasurer Additional information may be obtained from: JURAN & MOODY, INC., Minnesota Mutual Life Building, 400 North Robert Street, Suite 800, St. Paul, Minne sota 55101-2091; Telephone No.: (612) 224-1500. Amount $160,000 1998 $ 70,000 1991 170.000 1999 110,000 1992 180.000 2000 115.000 1993 190.000 2001 125.000 1994 205.000 2002 130.000 1995 220.000 2003 140.000 1996 150.000 1997 Bonds having stated maturities in 1996 and later years are each subject to redemption at the option of the City, in inverse order of maturities and in $5,000 prin cipal amounts selected by lot within a maturity, on February 1, 1995, and any date thereafter, at a price equal to the principal amount thereof plus interest ac crued to the date of redemption. Interest will be pay able on each February 1 and August 1, commencing August 1, 1990. A legal opinion will be furnished by Dorsey & Whitney, of Minneapolis, Minnesota. Cop ies of the Official Terms of Offering and additional in formation may be obtained from the undersigned or from Springsted Incorporated at the above address, telephone 612-223-3000, financial consultants to the City. Dated: September 12,1989. BY ORDER OF THE CITY COUNCIL Judith Cox, City Clerk City of Shakopee, Minnesota SPRINGSTED INCORPORATED PUBLIC FINANCE ADVISORS LEGAL NOTICE NOTICE OF CALL FOR REDEMPTION $300,000 MUNICIPAL BUILDING REVENUE BONDS OF 1984 CITY OF SPRING LAKE PARK ANOKA AND RAMSEY COUNTIES MINNESOTA NOTICE IS HEREBY GIVEN that by order of the https://fraser.stlouisfed.org 1THWESTERN FINANCIAL REVIEW Federal Reserve Bank of St. Louis & Drawz, a Professional Association, Minneapolis, Minnesota. The proceeds of the bonds will be used to finance a portion of the costs of various assessable public improvements in the City. Bidders should be aware that the Official Statement to be distributed for the bonds may contain additional bid ding terms and information relative to the bonds. In the event of a variance betw een statem ents in this No tice of Bond Sale and the Official Statement bidders must comply with the term s of the latter. Dated: September 5,1989 BY ORDER OF THE CITY COUNCIL Richard Grabow City Administrator PI RUC FINA \ d \L SYSTEMS 512 NICOLLET MALL. SUITE 550 MINNEAPOLIS. MINNESOTA 55402 I I I I PHONE: (612) 333-9177 Published in N orthw estern Financial Review September 23,1989 Juran & M oody, Inc. LEGAL NOTICE (612) 224-1500 V ----------Js Published in N orthw estern Financial Review September 23,1989 LEGAL NOTICE NOTICE OF BOND SALE $580,000 GENERAL OBLIGATION IMPROVEMENT BONDS OF 1989 CITY OF DETROIT LAKES, BECKER COUNTY, MINNESOTA NOTICE IS HEREBY GIVEN that sealed bids for the purchase of the above bonds will be received until 3:00, p.m., C.T. on Tuesday, October 3,1989, in City Hall in Detroit Lakes, Minnesota, at which time the bids will be opened and tabulated for consideration by the City Council at a meeting at 7:30 p.m. on the same day. The bonds are offered on the following term s. The bonds will be dated October 1, 1989, will bear interest payable semiannually on each February 1 and August 1, commencing August 1, 1990, and will mature on February 1 in the years and amounts as follows: Year Published in Northw estern Financial Review September 23,1989 f in a n c e Amount Year Amount $40,000 1999 1991 $20,000 35,000 2000 1992 50,000 35,000 2001 1993 50,000 35,000 2002 1994 50,000 35,000 2003 1995 40,000 35,000 2004 1996 40,000 35,000 2005 1997 40,000 1998 40,000 The City may elect on rc u iu d ij j., **./< ^ -** —j interest payment date thereafter to redeem and pre pay bonds of this issue in whole or in part, in inverse order of maturities and by lot within maturities, matur ing on or after February 1, 1998 at a price of par plus accrued interest to date of redemption. Bidders must specify a price of not less than $570,000 plus accrued interest. A legal opinion on the bonds will I be furnished by LeFevere, Lefler, Kennedy, O’Brien NOTICE OF CALL FOR REDEMPTION GENERAL OBLIGATION - REVENUE HOSPITAL BONDS, SERIES 1985 CITY OF NORTHFIELD, DAKOTA AND RICE COUNTIES, MINNESOTA NOTICE IS HEREBY GIVEN that by order of the City Council of the City of Northfield, Dakota and Rice Counties, Minnesota, there have been called for re demption and prepayment on February 1,1995 those outstanding bonds of the City designated as General Obligation - Revenue Hospital Bonds, Senes 1985, dated June 1, 1985, maturing in the years 1996 through 2007, both inclusive and totalling $2,360,000 in principal amount. The bonds are being called at a price of par plus accrued interest to February 1, 1995, on which date all interest on said bonds will cease to accrue. Holders of the bonds hereby called for re demption are requested to present their bonds for payment at the main office of First Trust National As sociation, formerly First Trust Company of Saint Paul, 180 East Fifth Street, 3rd Floor - Bond Drop Win dow, or if by mail to P.O. Box 64111, Saint Paul, Min nesota 55164-0111, on or before February 1,1995. Under the Interest and Dividend Compliance Act of 1983, 20% will be withheld if tax identification number is not properly certified. Dated: August 7,1989 BY ORDER OF THE CITY COUNCIL Karl Huber, Jr. City Clerk-Treasurer A dditional inform ation may be o b tained from : Springsted Incorporated, 85 E ast Seventh Place, Suite 100, St. Paul, Minnesota 55101; Telephone; (612) 223-3000. A ^ SPRINGSTED INCORPORATED PUBLIC FINANCE ADVISORS Published in Northw estern Financial Review September 23,1989 M u n ic ip a l F in a n c e LEGAL NOTICE NOTICE OF BOND SALE $575,000 GENERAL OBLIGATION WASTEWATER TREATM ENT BONDS, SERIES 1989 CITY OF LACRESCENT, MINNESOTA NOTICE IS HEREBY GIVEN that the City Council of the City of LaCrescent, Minnesota, will m eet in the City Hall at 7:00 o ’clock, p.m., on Monday, October 2, 1989, to receive and consider sealed bids for the purchase of $575,000 General Obligation Wastewater Treatment Bonds, Series 1989 of the City (the Bonds). The Bonds will be issued for the purpose of financing a por tion of the cost of the construction of a w astew ater treatm ent facility by the City. The Bonds will be regis tered as to principal and interest, will be issuable in the denomination of $5,000 or any integral multiple thereof, will be dated, as originally issued, as of Octo ber 1, 1989, and will mature on February 1, in the following years and amounts: Year Amount 1992 $40,000 !993 45,000 1994 45,000 !995 50,000 1-996 55,000 1997 60,000 1998 65,000 1999 65,000 2000 70,000 2001 80,000 Interest will be payable on each February 1 and Au gust 1, commencing February 1, 1990, to the regis tered owners of the Bonds appearing of record in the bond register as of the 15th day of the immediately preceding month. Bonds maturing in 1999 and thereaf ter are each subject to redemption and prepayment on February 1, 1998 and any in terest payment date thereafter at a price equal to the principal amount thereof to be redeem ed plus accrued interest. A legal opinion will be furnished by Dorsey & Whitney, of Minneapolis, M innesota. Copies of a statem ent of Terms and Conditions of Receipt of Bids and Award of Sale and additional information may be obtained from the undersigned. Dated: September 5, 1989 BY ORDER OF THE CITY COUNCIL Marlene Butzman City Administrator City of LaCrescent, Minnesota Published in N orthwestern Financial Review September 23, 1989 LEGAL NOTICE issued for the purpose of financing costs to be incurred by the City in aid of its Minnesota River Valley Rede velopment District No. 1. The Bonds will be issuable as fully registered bonds, in denominations of $5,000 or any integral multiple thereof, will be dated, as origi nally issued, as of November 1, 1989, and will mature on February 1 in the following years and amounts: Vear Amount Year Amount 1991 $60,000 1998 $130,000 1992 90,000 1999 140,000 1993 95,000 2000 150,000 1994 105,000 2001 160 000 1995 110,000 2002 170,000 1996 115,000 2003 185,000 1997 125,000 Bonds having stated maturities in 1996 and later years are each subject to redemption at the option of the City, in inverse order of maturities and in $5,000 prin cipal amounts selected by lot within a maturity, on February 1, 1995, and any date thereafter, at a price equal to the principal amount thereof plus interest ac crued to the date of redemption. Interest will be pay able on each February 1 and August 1, commencing August 1, 1990. A legal opinion will be furnished by Dorsey & Whitney, of Minneapolis, Minnesota. Cop ies of the Official Terms of Offering and additional in formation may be obtained from the undersigned or from Springsted Incorporated at the above address, telephone 612-223-3000, financial consultants to the City. Dated: September 12, 1989. BY ORDER OF THE CITY COUNCIL Judith Cox, City Clerk City of Shakopee, Minnesota ri SPRINGSTED INCORPORATED PUBLIC FINANCE ADVISORS Published in N orthwestern Financial Review September 23, 1989 Bonds), at which time the bids will be opened and tab ulated. The Board of County Commissioners will meet at the County Board Offices at 11:00 o ’clock a.m. on the same day to consider the bids and to award the sale of the Bonds. The Bonds will be issuable as fully registered bonds in the denomination of $5,000 or any integral multiple thereof, will be dated, as originally issued, as of November 1, 1989, and will mature seri; y e ars an amounts: Year Principal Amount Year 1990 $125,000 1995 $175,000 1991 140,000 1996 190.000 1992 150,000 1997 200.000 1993 160,000 1998 210,000 1994 165,000 1999 225,000 interest will be payable on each June 1 and December 1, commencing June 1, 1990, to the registered owners of the Bonds appearing of record in the bond register as of the 15th day of the immediately preceding month. Bonds maturing in 1994 and subsequent years are each subject to redemption and prepayment on December 1, 1993 and any interest payment date thereafter at a price equal to the principal amount thereof to be redeem ed plus accrued interest. The Bonds will be designated by the County as “ qualified tax-exem pt obligations” for purposes of Section 265(b) of the Internal Revenue Code of 1986, as amended. A legal opinion will be furnished by Dorsey & Whitney, of Minneapolis, Minnesota, as Bond Coun sel. Copies of a statem ent of Terms and Conditions of Sale and additional information may be obtained from the undersigned or from Miller & Schroeder Financial, Inc., Northwestern Financial Center, 7900 Xerxes Av enue South, Minneapolis, M innesota 55440; tele phone 612-831-1500, financial consultants to the County. Dated: S e p te m b e r^ , 1989. BY ORDER OF THE BOARD OF COUNTY COMMISSIONERS Robert Bruns County Auditor Nicollet County, Minnesota LEGAL NOTICE NOTICE OF BOND SALE $1,740,000 GENERAL OBLIGATION CAPITAL IMPROVEMENT BONDS, SERIES 1989 NICOLLET COUNTY, MINNESOTA NOTICE IS HEREBY GIVEN that sealed bids will be received at the office of the County Auditor of Nicollet County, Minnesota, until 10:30 o ’clock a.m ., on Tues day, October 17, 1989, for the sale of $1,740,000 General Obligation Capital Improvement Bonds, Series 1989 of the County (the Miller &.Schroeder Financial, Inc. Northwestern Financial Center 79 0 0 Xerxes Avenue South P.O. Box 789 Minneapolis, Minnesota 55451 Published in N orthwestern Financial Review September 23,1989 NOTICE OF BOND SALE $1,635,000 GENERAL OBLIGATION TAX INCREMENT BONDS, SERIES 1989B CITY OF SHAKOPEE. MINNESOTA NOTICE IS HEREBY GIVEN that the City of Shakopee, Minnesota, will receive sealed bids for the pur chase of $1,635,000 General Obligation Tax Incre ment Bonds, Series 1989B, of the City (the Bonds), until 11.00 A.M ., Central Time, on Tuesday, October 3, 1989, at the offices of Springsted Incorporated, 85 East Sev enth Place, Suite 100, St. Paul, Minnesota 551012143 at which time the bids will be opened and tabu lated for presentation to the City Council for action thereon at a meeting to be held at the City Hall at 7:30 P.M., on the same day. No bid submitted may be with drawn before the Council meeting. The Bonds will be https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis Principal Amount ADVERTISERS Please not© our nsw address and phone numbers for all of your correspondence. 2 8 5 0 Metro Drive, Suite 7 0 4 Bloomington, MN 5 5 4 2 5 6 1 2 -8 5 4 -2 1 7 7 Fax 6 1 2 -8 5 4 -2 6 2 7 SEPTE he best source of information for all finan cial institutions in the Upper Midwest is now available in new 1989-90 editions— including separate directories for Iowa and Nebraska! Each directory contains the most current and accurate listing of key execu tives and directors, bank addresses and phone numbers including telefax, and yearend balance sheet figures from December 31, 1988 call reports. Published since 1912, the North western Bank Directories are recognized as the leading choice of banking profes sionals in the eleven state area. That s because no one provides more valuable information about midwestern banks (and just midwestern banks) at a comparable value. Order your choice of directories today. But act soon. Supplies are limited. For faster service call 612-835-5225 and charge your purchase to VISA or MasterCard. T Facts’ll Figures You Can Bank On. The NEW 1989-90 Northwestern Bank Directories! (Please note: the p ric e s show n tor the NO R TH W ESTER N BA N K DIREC TORIES are available to p aid s u b s c rib e rs of the NO R TH W ESTER N FINAN C IA L REVIEW, a banking journ al. D ire cto ry p rice s for n o n -s u b s c rib e rs are higher. Call fo r details.) Send this order form along with your check or money order payable to Financial Communications, Inc. to: 5270 W. 84th Street, Suite 480, Bloomington, MN 55437. 1989-90 Edition Northwestern ^ n k Directory of NEBRASKA □ Please send me the new 1989-90 edition of: T i t l e Price Shipping $45.00 $2.50 Quantity $ Total Price $20.00 $2.50 $ $15.00 $2.50 $ ______________________ ___________________ The NORTHWESTERN BANK DIRECTORY of the UPPER MIDWEST The NORTHWESTERN BANK DIRECTORY of IOWA The NORTHWESTERN BANK DIRECTORY of NEBRASKA <fc Minnesota residents add 6% sales tax. $_ Enclosed is my check/money order for $ --------- _ □ lancial Communications, Inc. □ Charge my purchase to □ Financial including shipping and sales tax if applicable. Make payment to VISA □ MasterCard Name Street Company Name City Signature https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis State, ZIP Card No. Exp. Date Date 19 89 -9 0 Edition 80 YEARS STRONG EXPERIENCE! There is no substitute. That’s Right! For EIGHT DECADES We have been filling the Bonding Needs of Midwestern Bankers THE REASONS . . . SUPERIOR SERVICE MOST COMPETITIVE PREMIUMS REALISTIC UNDERWRITING PROMPT CLAIMS SERVICE IF YOU’RE NOT GETTING THE SAME FROM YOUR BONDING COMPANY GIVE US A CALL - YOU’LL BE GLAD YOU DID. THE KANSAS BANKERS SURETY COMPANY DONALD M. TOWLE President RATED A (Excellent) by A.M. Best 1988 Edition DAVID E. ABENDROTH Senior Vice President 611 Kansas Avenue P.O. Box 1654 Topeka, Kansas 66601 Phone 1-913-234-2631 FINANCIAL INSTITUTION BONDS, SAFE DEPOSITORY LIABILITY, CHECK KITING FRAUD INDEMNIFICATION DIRECTORS AND OFFICERS COVERAGE ' O w n e d b y Bankers to Serve Bankers Since 1909 https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis When it comes to correspondent banking, we’v e got you covered like never before. Wherever your bank is located, whatever size your bank may be, you can count on a Norwest Correspondent Banker to bring you the specialized services you need. Our Correspondent Bankers are available throughout the midwest to serve you better and faster. We make it our business to understand the special needs of community banks. And we want to do business with you. Whether you need a bank valuation, acquisition financing, ATM access, investment alternatives, or any of our correspondent services, call your Norwest Correspondent Banker. When it comes to correspon dent banking, we’ve got you covered like never before. HUSNORW EST BANKS ~ NORWEST mu'imm CORRESPONDENT BANKING Equal Opportunity Lender ) 1988 Norwest Bank Member FDIC https://fraser.stlouisfed.org Federal Reserve Bank of St. Louis
@FedFRASER