June 2010 The Kansas Banker

PLUS:Consumer Financial

Protection Agency overreaches goals

pg. 3

How to build a high-caliber, family-owned

bank—part twopg. 11

The

The magazine of the Kansas Bankers Associationwww.ksbankers.com

June 2010

•Meet Community state Bank pg. 20•Bankers earn awards for grad schools pg. 12

KANSAS BANKER

YBOK tees off 2010 Spring Conference

June 30 last day for calendar submissions!

See page 15 for more details

Volume 100/Number 6The mission statement of the Kansas Bankers Association is: To support and assist Kansas

banks and Kansas bankers.

ChairmanJeannette Richardson, Farmers National Bank,

Hutchinson

Past Chairman David Herndon, First State Bank of Kansas City,

Kansas City

Chairman-ElectJohn E. Boyer IV, KANZA Bank, Kingman

TreasurerJohn Lehman, First National Bank, Girard

Immediate Past ChairmanSteve McSpadden, Union State Bank, Winfield

Term Expires August 2010Sue Hart, Great Western Bank, Shawnee Mission

Joe Smith, Farmers National Bank of Kansas, WalnutRoger Kepley, INTRUST Bank, Wichita

Ted Starr, Citizens State Bank & Trust Co., Hiawatha

Michael Mense, State Bank, HoxieDave Long, First National Bank, Cimarron

Term Expires August 2011Greg Sims, Town & Country Bank, Leawood

Michael Ewy, Community State Bank, CoffeyvillePaul Boeding, Baileyville State Bank, Seneca

Kyle Russell, Versus Bank, N.A., DerbyDavid Brownback, Citizens State Bank, Ellsworth

Kelly Mason, First National Bank, Pratt

Term Expires August 2012John Danler, Girard National Bank, Yates Center

Julie Hower, Farmers & Drovers Bank,Council GroveCalvin Coady, Bankers’ Bank of Kansas, NA, Wichita

Robin LacKamp, Peoples Exchange Bank, Belleville

Scott Chipman, Fidelity State Bank & Trust Company, Dodge City

At Large Representatives1 Yr.: Tom McGavaran, State Bank of Delphos,

Delphos2 Yr.: Frank Carson III, Carson Bank, Mulvane

3 Yr.: Kendal Kay, Stockgrowers State Bank, Ashland

Trust Division PresidentMike Sears, Great Plains Trust Co., Shawnee Mission

Ag Bankers Division PresidentDan Heinz, INTRUST Bank, Wichita

YBOK Division PresidentAlex Williams, The Halstead Bank, Halstead

Kansas Bankers Association Board of Directors and

Voting Members

2 THE KANSAS BANKER June 2010

The Kansas Banker (ISSN 0028-9880) is published monthly for $25 per year plus applicable tax by Kansas Bankers Services, Inc., a wholly owned subsidiary of the Kansas Bankers Association. Periodicals’ postage paid at Topeka and at additional mailing offices. With the exception of official Association announce-ments, the Kansas Bankers Association disclaims responsibility for opinions expressed and statements

made in articles or advertisements published in The Kansas Banker. POSTMASTER: Send address changes to P.O. Box 4407, Topeka, KS 66604-0407

Eric Jorgensen, [email protected]

CONTENTs

Picturing Kansaspg. 15

“Cram down” lenders cram backpg. 10

Meet a bank—Community State Bankpg. 20

Sara Blubaugh, Advertising Manager [email protected]

Kansas Bankers Association 610 S.W. Corporate View Topeka, KS 66615.

(785) 232-3444. Fax (785) 232-3484.

[email protected].

Send mail to: P.O. Box 4407 Topeka, KS 66604-0407.

KBA Leaders Ledger—Updatespg. 4

Building a high-performance, family-owned bankpg. 11KBA announces banker scholarshipspg. 12

Washington Updatepg. 16

CFPA overreaches goalspg. 3

Security Officer’s Bywordpg. 17

Hodge & Porter annual golf event a successpg. 14

Briefly—Updatespg. 5YBOK holds spring conferencepg. 8

Corrections: Harold Engle Jr. was listed as executive vice president in May’s “Meet a bank.” Engle is retired.

Cover photo by James A. Gerstner, Sunflower Bank, N.A., Hays

June 2010 THE KANSAS BANKER 3

With so much negative com-mentary about the banking industry, it’s easy to miss the

fact that more than 325 traditional fed-erally insured banks and their more than 14,000 employees are serving towns and cities across Kansas. Lending typically declines in reces-sions. Yes, there are individuals and businesses that have not been able to obtain a loan. That may be because their cash flow or collateral positions have

changed. Or because bank examiners are looking more closely at every loan—especially ones involving real estate—which is what happens in every economic downturn. Bankers are accustomed to scrutiny. They expect examiners to analyze their operations based on standard banking prin-ciples, the most basic of which boils down to one question: “If I lend you this money, will you pay it back?” Traditional bankers get paid when people repay their loans. But there was a different standard in play in the runup to the housing collapse and subsequent economic meltdown. The vast majority of subprime, no-documentation loans were made by entities outside the traditional banking industry. These loans were originated by individuals with no stake in the transaction who were compensated on the basis of the number of deals done, not whether they were repaid. The Kansas Bankers Association and the country’s state bankers and associations believe Congress should enact regula-tory reforms. Key goals should be eliminating “Too big to fail,” determining a process for resolving institutions that pose the greatest risk to the economic system, and strengthening cross-agency oversight of financial institutions and markets so signs of risk can be identified and addressed at the earliest possible

point. It must be reform that is effective and does not impose crushing, overreaching regulations at a time when traditional banks are helping their communities deal with a fragile econo-my. The proposal for a new Consumer Financial Protection Agency—one more huge, expensive government operation—looms as the worst of both worlds, harming traditional banks while exempting from oversight many of the entities that were responsible for the toxic loans. If reform punishes the good lenders—the ones at the heart of the nation’s economic recov-ery—and lets the bad ones go untouched, the nation’s commu-nities will pay the price. In addition, such an agency would actually hurt consumers. A study by researchers David Evans and Joshua Wright showed that “under plausible yet conservative assumptions” the Con-sumer Financial Protection Agency would:

•Increase the interest rates consumers pay by at least 160 basis points

•Reduce consumer borrowing by at least 2.1 percent

•Reduce the net new jobs created in the economy by 4.3 percent

The focus on the small number of bad actors has caused many to lose sight of the good that the banking industry—its 8,300 banks and millions of employees across the country—is doing every day. We worry that the leadership many of these banks provide through loans, volunteer service and financial invest-ments is in jeopardy if financial reform is not done well. We also worry about bank customers if the federal govern-ment decides to help them balance their checkbook. That’s the kind of “consumer protection” that this country can’t afford.

Columns

Chuck StonesPresident of the Kansas Bankers

Association

CFPAletter from the president Updates

New agency overreaches; misses point

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KBA LEADERS LEDGERdivision leader news UPDATES

During my six years as a member of Team KBA, I’ve heard plenty of stories about the good ol’ days when the primary focus of the Young Bank Officer of Kansas was...Well, let’s just call it “social enlightenment.” I have no doubt that being a member of KBA-Young Bank Officers of Kansas has always been more fun than belonging to most run-of-the-mill clubs or organizations. I am happy to report that “fun” remains a key ingredient for the new and improved YBOK division of the KBA. However, I’m equally happy to report that

YBOK’s board of directors is working hard to ensure that education and professional development rival the good times that have always been a part of the YBOK experience. If you haven’t taken a look at YBOK lately, it’s time for a second glance. Look no further than the 2010 YBOK Spring Conference review included in this issue of The Kansas Banker and you’ll see that KBA’s YBOK Division is providing first-class educational opportunities, as well as direct financial assistance to young bankers seeking to enhance their banking, leadership and management skills. Rest assured, YBOK is still creating those good ol’ days’ memories, but today’s YBOK is pro-viding so much more. For information on becoming a YBOK member, please contact me at [email protected] or give me a call at (785) 232-3444.

KBA has published both its 2010 Compensa-tion and Benefits Survey and 2010 Compara-tive Data Report/Service Charge Survey as of June 1. Banks who participated in the surveys should have already received their copies of the reports. KBA member banks who did not participate in one or both surveys have the opportunity to purchase copies of the reports. The order form is available at www.ksbank-ers.com under the products and services tab.

The KBA Education and Human Re-sources Committee met last month to begin

developing our educational calendar for 2011. The committee used the recently-conducted needs assessment as a tool to determine which training topics are most needed by KBA member banks. If your bank has a particular training need, please feel free to contact me at (785) 232-3444 or [email protected]. We will do everything possible to accommodate your need. We will be holding our Deposit Compliance and Account Docu-mentation seminars in October in seven locations across the state. In addition to the live seminars, KBA Senior Vice President Terri Thomas is prepared to deliver one or both of these programs in-house for you and your employees beginning in November. This is a great way to make sure all of your staff has access to this much needed training. To schedule your in-bank seminar, please contact me for pricing and available dates.

The KBA Legal Department has now com-pleted the 15 state-wide 2010 Legal Update presentations. If your bank was unable to attend this year’s seminar, don’t worry, the 2010 Legal Update book is now available for purchase. Contact Linda Brown ([email protected]) to place your order. Additionally, the Department reminds bankers of some very important dates that are approaching. On June 1, 2010, your bank must have its Unlawful Internet Gambling Policy (Regulation GG) implemented.

On July 1, 2010, your bank must begin complying with three impor-tant regulations: 1. Regulation E’s new overdraft rules pertaining to one-time debit card and ATM transactions on new accounts opened on or after July 1 2. The FACT Act’s Accuracy and Integrity rules requiring banks to have reasonable policies and procedures to ensure the accuracy and integrity of information reported to a credit reporting agency 3. The FACT Act’s provision requiring financial institutions to resolve a consumer’s dispute of the accuracy of credit information Information about all of these new regulations can be found in the 2010 Legal Update book or by contacting the Legal Department.

Legal

KBA Divisions

Products and Services Education

Education’s yearly surveys areavailable for purchase

Doug Wareham

YBOK—more than a good time

Terri Thomas

The beginning of June and July mark important reg changes

Becky Tongish

One of my functions with the KBA is to review banking products and services. As you can imagine I get a lot of opportuni-ties to do this. It is not always easy to know when a product or service is of real value to a KBA member bank. That’s why every year 15 banking associations from the Midwest get together to share ideas, discuss our suc-cesses and not-so-successful partnerships, and listen to vendors update us on the lat-est and greatest products on the market. This group, called the Mid-States Con-

sortium, has been meeting for more than 15 years. It is a great op-portunity to listen to some new vendors and to share successes (and failures) with my counterparts in the Midwest. I have been busy in the products and services area lately and I was eager to share some of my successes, including our latest endorsements: Cost Segrega-tion Services, Inc., The Senior Housing Crime Prevention Founda-tion, and Purple Wave Auction. I also was able to discuss our newly formed partnership with Title Midwest, Inc.—Kansas Banker’s Escrow Services, LLC. It is really great to be able to share these strategic alliances and the processes I went through to bring these “endorsements” to the KBA. I always learn a lot from my counterparts and hopefully they are learning from me as well. I would like to thank the sponsors of this year’s meeting: UMB Bank, Deluxe Corporation, Brintech, Promontory Interfinancial Network, LLC, Zurich and Bankonhold.com.

Always seeking services for the KBA

Mike Norris

Legal

Locke celebrates retirementFormer KBA Chairman Steve Locke, presi-dent, INTRUST Bank, N.A., Junction City, was joined by family and friends to com-memorate a long and dedicated banking career. Locke retired following 45 years in banking. KBA President Chuck Stones was on hand to personally thank Locke for his years of service to the Kansas banking industry.

Locke ran the Junction City IN-TRUST Bank since its inception in 2007. Prior to that he helmed First State, Junction City. Starting on the other side of the coin, Locke was a bank examiner following his gradu-ation at South-western Graduate School of Banking at Southern Meth-odist University.

Determined to continue helping his

bank, as well as the industry, Locke plans to consult the bank on a part-time basis.

Colby museum honors bank with history lessonThe history of the two families who formed Farmers and Merchants Bank, Colby, on Jan. 3, 1887, was shared with guests at the Prairie Museum of Art and History in late April.

Judie Withers and Lon Frahm broke down the development of the families and their paths toward the bank’s inception.

The very accomplished Arthur Kaaz Jr., a former director for Leavenworth Na-tional Bank, Leavenworth, died April 17 in Lawrence at the age of 79, according to the Leavenworth Times. The former director was also a member and/or director of several companies and organizations, including The Architectural Woodwork Institute, the Kansas City Club and Harvard Club of Boston. After graduating with honors from the University of Kansas in 1952 as an ROTC cadet, he graduated with honors from the Harvard Business School in 1954. He then served as an Air Force officer before returning home to his family business, Kaaz Woodwork Company, where he became president in 1972. He then formed the Kaaz Holding Company in 1977, where he served as president until his death.


BR IEFLYUPDATES

In fond memory...

sunflower state news and trends UPDATES

Steve Locke poses with Wife Karen Locke at his retirement ceremony.

Lori A. Lundy | Senior Vice PresidentProsperity Bank | Victoria, Texas

“SHAZAM is more than a vendor to us.”

Our Difference is You“They’re like family. They know us and we know them. We like the

personal service we get when we call SHAZAM. We rely on their

expect, while keeping costs under control. It feels special to know that

someone is out there really working for us.”

For more information about SHAZAM, visit us at

www.shazam.net or call (800) 537-5427.

Today’s Community Bank Model: There is No “Normal” Anymore

Today’s Community Bank Model is a program designed to assist CEOs and senior manage-ment with critical decisions they must make today that will have a major impact in the years to come. You and your bank will receive information, answers and action strategies that can be taken back to the bank for immediate implementation to improve earnings and manage your expenses. Don’t wait for things to get back to normal - they won’t. Business as usual will be business lost. This is a new frontier, and to succeed, you need to be prepared.

Topics covered during this interactive workshop include:

- Compete with affordable technology - Improve your effi ciency ratio - How to grow loans and/or deposits in this economy - Raise non-interest income (fees) - Increase interest income and reduce non-interest expenseProgram presenter:Robert McGoffi n is an experienced bank CEO and instructor at the Graduate School of Banking at the University of Wiscsonsin, and at the GSB Senior Management Seminar.

Registration limited to 35 per site.

August 24, 2010Wichita

August 26, 2010Topeka

Educational Resourceswww.ksbankers.com

785-232-3444

Consumer debt has steadily increased over the

past several years and has reached alarming levels.

For this reason, it is important for bankers to tighten

their lending practices to ensure the next consumer

applicant is not becoming overextended and unable

to meet their obligations.

Upon completion, participants will have a better

understanding of underwriting consumer loans from

the application to the closing and will be able to

place this knowledge into practice immediately

upon returning to the bank.

Program Presenter: Jeffery W. Johnson CEO and Executive Consultant Bankers Insight Group

Educational Resources

785-232-3444 www.ksbankers.com

August 17

Hays

August 18

Overland Park

Kansas Bankers Association

2010 CONSUMER LENDING & COMPLIANCE SEMINAR

Education is a lifelong endeavor. And as the Kansas Bankers Association—Young Bank Officers of Kansas learned from Rick Olson, they have plenty of time to continue learning.

“It’s what you learn after you move the tassel that matters most,” says Olson, who keynoted the 2010 YBOK Spring Conference and Annual Meeting. Held in The Oread, the recently opened Lawrence hotel, the conference and its speakers gave YBOK members information on how to grow as a banker, develop future customers, and an economic prospectus for the state and country. The conference marks the of-ficial shift of the YBOK Annual Meeting to the spring from the fall. Current Division President Alex Williams, president, Halstead Bank, Halstead, took the reins of the division at the 2009 Fall Conference. He is currently serving a 16-month term as president, which began at the fall conference and will end at the 2011 spring conference. From that point forward, the president will return to serving a year-long term. Olson, the energetic speaker with an animated voice, opened up both days of the conference and began his first speech by honing in on the idea of continuing education well after your college years. An environment of continual learning could be a place of very successful business. He cited Ritz Carlton, the hotel chain, as an example of a company who continually educates its employees thoroughly. Because of this, Ritz Carlton is often a step ahead of its competitors, who provide most of their education to employees on day one, then rarely provide any more. The result of continual education, Olson says, is a custom-er experience that is better than any other hotel. With that superior customer service often comes loyal customers and good reviews. Such a process could be easily adopted in banks. Continually educat-ing its employees, as well as letting employees offer feedback to bank management, can provide enough new ideas to help any bank sustain top-flight customer service. Olson recommends creating a culture that promotes adaptation. Planning for the future is impossible, as no one knows what the next day, month or year will look like. But being able to adapt with the times could take a bank’s customer service to a higher level. And the first step to creating an adaptable, amiable environment is by giving new employees a great first day, Olson says. A day, when done, they will go home with the conclusion this job will be the favorite of their career. He stresses the importance of education as opposed to training. “Training puts you in a passive mode,” Olson says. He believes an educational system based around a yearly training day doesn’t benefit the company the way continual education through morning meetings or even having employees read the same business-based book could have. Good companies spend 3-5 percent of payroll in training and educational programs, he says. Olson notes change isn’t always accepted when it’s forced on someone. People and employees have to feel like they are part of the change; like they have a stake in it. This often times can be done by incorporating and recognizing changes and improvements suggested by employees. “One of the great talents of a leader is to help navigate people through change,” Olson says. “You can change with people, but you can’t take change to people. People support what they create.” With bank personnel happy, learning and intact, Olson

says now the bank should set expectations for customer service. He says banks can’t simply hire people and expect them to have a posi-tive impact on business. Olson used Disney World and Disneyland as examples of cus-tomer service expectations. The theme parks are locations where the customer service is led almost exclusively by teenagers and people in their early-20’s. How is it these young employees operate a business that helps generates billions of dollars? Expectations. They’re expected to make a child’s day every day. They’re expected to be cheerful and helpful day-in and day-out, Olson says. And by do-

ing so, these young people keep the custom-ers flocking in year-after-year. The same approach can be used in banks. If employees are expected to make a customer’s day better, and then deliver, it helps the chances of them frequenting the bank and bringing more business with them. You can assure good customer service everyday by maintaining good communica-tion with both your customers and your employees, Olson says. Ask your customers, “What one thing could we do to make this a better experience for you?” Take those sug-gestions and then communicate them daily to your staff. Hitting on the economy was Esther George, vice president and COO of the


YBOKFeaturesconference recap

2010 marks first annual meeting in spring

Rick Olson explains how the Ritz Carlton successfully uses continual education in the workplace to increase customer service. He sug-gests banks could do the same.

Mike Sobba

Federal Reserve Bank of Kansas City, who updated YBOK both on the state of the economy, and the soon-to-be Consumer Financial Protection Agency, stemming from the Restoring American Financial Stability Act of 2010. In regard to the state of the economy, George brought refreshing and good, or close-to-good, news. “The good thing is the U.S. economy is recovering,” George says. “It’s not booming, but we are seeing signs that it is stabilizing.” The United States is also slowly deleverag-ing, she says, and the task is painful. She says the Greek bailout and instability of the Euro is troubling, but she suspects the Greek bailout will work. “The riots you’re seeing in Greece are what happen when the rem-edy is not applied equally,” she says. George says similar protests could spark in other struggling na-tions if certain demographic groups or business sectors are favored by recovery efforts. When she was done, George offered some hope to the anxious bankers. “I feel much better today than I did two years ago,” she says. Before the conference resumed the second day, the annual meet-ing was held with President Williams presiding. After approving the 2009 annual meeting’s minutes, Williams announced the annual meeting will henceforth be held in the spring. During the meeting, a handful of scholarship drawings for training offered by the KBA or the KBA/NBA Schools of Banking left many bankers smiling as they were awarded $500 training gift certificates. After Olson kicked off the second day of the conference, Dr. John Wong, an economist from Wichita State University, gave a Kansas-

specific economic outlook. Wong went into deep detail with dozens of charts and examples that provided some hope as the state’s recovery moves forward, as well as eye-opening statistics as to how the recession grew so deep. Following Wong was Jim Marchiony, associate athletic director for Kansas Athletics, Inc. (the University of Kansas’ athletic department). Marchiony answered questions and covered numerous sports topics, ranging from Big 10 conference expan-

sion to the latest accomplishments with KU-specific sports. The conference concluded with a rainy, challenging afternoon of golf at Lawrence’s Alvamar Country Club. The golfers braved the conditions, and ruined many shoes and pants, to shoot a round and discuss the conference’s lessons. Winning the top prize at the tournament was Derek Baily, Lawrence Bank, Lawrence; Brian Rowling, Arvest, Shawnee; Jarrod Rowland, Alden State Bank, Sterling; and Lucas Sawyer, Farmers National Bank, Inman.


Features

sponsorsstrunk & Associates, L.P.

The University National Bankstinson Morrison Hecker, LLP

schools of Banking

Above: YBOK President Alex Williams opens the annual meeting. Above: FDIC Vice President and COO Esther George discusses the international economy.

Above: T.J. Wilson of Union State Bank, Everest, poses a question for Esther George.

Above: Wichita State Economist John Wong describes how the recession grew so deep.

Above: Bankers work in groups to discuss new fee-based methods of acquiring capital.

The 2010 YBOK Spring Conference and Annual Meet-ing’s golf tournament was won by (from left to right) Derek Bailey, Brian Rawlings, Jarrod Rowland and Lucas Sawyer.


BANKRUPTCY LAWFeatures

“Cram down”—lenders cram backlegal news

As most lenders are aware, the 2005 modifications to the Bank-ruptcy Code made it increas-

ingly difficult for Chapter 13 debtors to modify claims secured by their vehicle. If the vehicle is a “910 car,” (the vehicle was purchased with the creditor’s money for personal use within 910 days of the filing of the bankruptcy case) the debtor must pay the full debt secured

by the vehicle, or let the creditor repossess and sell the motor vehicle. However with loans that do not meet this “910 car” criteria, a debtor can divide the claim on a personal vehicle into a “secured” portion which must be repaid in full, and an “unsecured” portion which gets repaid with other unsecured debts under the plan. This has historically been referred to as a “cram down.” (scholars have pondered whether the term comes from the “cramming down” the value of the car to a lesser amount, or “cram-ming” the value down the lender’s throat) The ability of the debtor to “cram down” a portion of their car loan makes the role of valuation in a bank-ruptcy proceeding critical to the outcome of a case. It should come as no surprise that valuation of a vehicle is generally a source of great disagreement between the creditor and debtor. The creditor wants the vehicle valued as highly as possible because any amount owed beyond the value of the vehicle will be typically discharged. The debtor, on the other hand, wants the value lower, so the amount they pay to the creditor is reduced. For many years, bankruptcy courts have struggled to find a valuation approach that can be consistently applied in a uni-form manner. In recognizing that a uniform approach would provide predictability for debtors and creditors, Congress ad-opted a “replacement value” standard as part of the Bankrupt-cy Code amendments in 2005. This was intended to resolve much of the uncertainty that existed under prior law. How-ever, due to the numerous factors and possibilities in evaluat-ing “replacement value” in each individual case, ambiguities in applying the “replacement value” standard continued. As a result, debtors and creditors found themselves continuing to battle it out in court with valuation issues. The disparity and confusion of the proper method of valu-ing a used car in Kansas has recently been tackled by the United States Bankruptcy Court for the District of Kansas. In September 2009, United States Chief Bankruptcy Judge Rob-ert E. Nugent adopted an approach in In re Cook that at least one other bankruptcy court in the District of Kansas has be-gun to follow. This new approach tends to give used vehicles a higher value than previous methods adopted by the court. In In re Cook, GMAC objected to the debtor’s bankruptcy plan when the debtor proposed only paying $9,280 on the

secured claim of $15,829. The court heard testimony from car experts on both sides. The debtor’s expert appraised the “re-placement value” of the vehicle using its National Automobile Dealers Association (NADA) Trade-In value after recondition-ing at $9,400. The creditor’s expert, on the other hand, ap-praised the “replacement value” of the vehicle using its NADA Clean Retail value at $12,400, plus some other factors which ended up at $14,200. After finding the testimony of both experts to be credible, the court determined the best starting point for “replacement value” of personal use vehicles is the NADA Clean Retail, ad-justed for necessary deductions resulting from the condition of the specific vehicle being valued. These may include (but are not limited to) mechanical, body, and interior repairs as well as deductions to account for excessive mileage. After tak-ing the necessary repairs into account, the court determined that a retail merchant would charge $11,375 for a vehicle similar to the one the debtor had in her possession, and found that to be the replacement value under the Bankruptcy Code. Under the approach of In re Cook, two debtors possessing vehicles of the same make, model, and year may end up with

a different value based on the condition of the vehicle. However, the consistent use of NADA Clean Retail value as the starting point for determining “replacement value” will go a long way in providing predictability and uniformity to creditors forced to enter the bankrupt-cy system. With the adoption of NADA

Clean Retail, secured creditors are in a much better starting position than in the past. NADA Clean Retail represents the highest value that NADA uses to appraise used vehicles. The high starting point values the car as if it were in mint condi-tion. Even though debtors have the opportunity to submit evidence to adjust the NADA Clean Retail downward for de-fects in the car, the baseline number starts much higher than it has in the past. Assuming debtors will have no option other than to keep their cars, secured creditors will reap the benefit of having the car valued at a higher price and thus keeping a larger percentage of their loan secured. Wes Smith is the past-president of the Bankruptcy and In-solvency Section of the Kansas Bar Association. He currently serves as the CLE Committee Chairperson for the Kansas Bar Association. He is a partner at Stevens & Brand, LLP and primarily represents debtors and community banks in bankruptcy cas-es. Wes is an Adjunct Professor of Law at the University of Kansas, teaching commercial law and is frequently a lecturer on bankruptcy and commercial law for continuing education classes. In 2009, he was chosen as one of the Best Lawyers in America in the area of bankruptcy.

The views expressed in this article are those of the author and not necessarily those of the Kansas Bankers Association.

By Wes SmithCLE Committee ChairpersonKansas Bar Association

Wes Smith

“With the adoption of NADA Clean Retail, secured creditors are in a much better starting position than in the past. NADA Clean Retail represents the highest value that NADA uses to appraise used vehicles.”


FAMILY-OWNED BANKpart two of two Features

Creating a high-performance family-owned bank —part two By Greg WolfConsultant with Kennedy and Coe, LLC

Performance management A good performance manage-ment system guides hiring, evaluation, and promotion of all employees using the same tools and objectives. This top-ic necessarily follows strategic planning, because it is vitally important to start by hiring the right people, according to the core values developed in the strategic planning process, to assure “best fit” employees for the bank. In addition to employees that fit the organi-zation, banks should be look-ing for employees willing to contribute and even challenge meaningfully, more along the lines of entrepreneurial team players than just employees that fit a particular job description. “What gets measured gets done,” and to be effective perfor-mance evaluations must be centered on what results employ-ees achieve and how that relates to bank success. It is more effective to boil these results measures down to three to five concise benchmarks, rather than a dozen or more. Evaluations are not altogether about objective performance but also about the interests and development of employees. Finally, financial rewards must be tied to daily performance, with short time horizons for line staff, and longer ones for management.

Compensation methods As performance management systems follow strategic plan-ning, so compensation methodology logically follows perfor-mance management. There are a number of different ways to compensate employees based on performance. But before jumping into one or more of them, it is important to define exactly who the bank seeks to reward, and why, before evalu-ating options and designing a system. The graphic at the top of the page illustrates this with three different compensation targets and a sample of methods that could be considered for rewarding each. In some banks there will be different com-pensation methods to target all three. This is a far too com-plex subject for detail, but the key is to match compensation methods most equitably with employee and bank success, and grow the performance and tenure of personnel over time. The word “designed” speaks of a multitude of variations that can be used to customize a particular method. It allows a compensation method to be more specifically targeted, as well as tied more closely to incentives for performance. An

example of customization within the Deferred Compensation area is tying compensation to “virtual equity.” This can be through a stock appreciation formula, issuance of “shadow” stock, or some other financial formula. The key objective here is to extend equity value to key employees in the management circle, without giving up equity control. This has a lot of value in strengthening the ties of non-family key executives to the bank if the ownership group does not desire to extend equity opportunities. There are numerous rules governing compensation meth-ods. It is vitally important to be up to speed with those rules and to remain in compliance with them to mitigate risk to the bank. Strategic planning, performance management and com-pensation methods, when implemented effectively, are real solutions to some of the common challenges of building a high-performance team in a family-owned bank. They will help avoid the chaos and conflict that can plague the overlap areas between ownership, management and family in a bank, and can provide better clarity and communication regarding them, leading to long-term bank success.

Greg Wolf is in the firm’s Agriculture Group in Pratt. This article is drawn from a presentation made to the American Bankers Association Ag Lending Conference in San Antonio last November by Wolf and Chuck Marshall, Kennedy and Coe, LLC’s Financial Institutions Group, Wichita.

Features

To read part one, see the May issue of The Kansas Banker.


SCHOLARSH IPSaward winners

Kansas bankers continue educationFeatures

Six Kansas bankers have been awarded scholarships to attend graduate school of banking studies later this summer. The recpients were selected based on their outstanding leader-

ship and commitment to their communities and to the banking industry, and in some cases, their performances at the Advanced School of Banking. With these scholarships, each individual will receive a $1,100 discount on fees per year for attendance at the Graduate School of Banking at Colorado or $1,250 discount per year for attendance at the Graduate School of Banking at the University of Wisconsin-Madison. The Human Resource School

Scholarship recipient will receive an $800 discount off tuition for the one-week school. Also, the Kansas Bankers Association, in conjunction with the Schools of Banking, has awarded an additional scholarship to a student selected to advance from the School of Banking Funda-mentals to the Advanced School of Banking. The recipient was selected based on class participation, demonstrated leadership abilities and final examination scores. They will receive a $700 discount off the tuition for the two-year school. The 2010 scholarship recipients are:

shanda Chambers, First National Bank, IndependenceGraduate School of Banking at Colorado Future Leadership ScholarshipChambers received her undergraduate degree in business/fashion merchandising from Baker University and an MBA from Emporia State University. She attended numerous KBA-sponsored training programs, including the KBA/NBA Bank Compliance School and Opera-tions School and will attend the Graduate School of Banking at Colorado this summer.

Brian Eilert, First National Bank, BeloitProchnow Educational Foun-dation Scholarship for the Graduate School of Banking at the University of Wisconsin-MadisonAs a small town banker, Eilert has been involved with all aspects of personal, business and agricultural lending for the past 10 years. Eilert has completed several banking schools, including the School of Lending Principles, Agricultural Lending School, and the Advanced School of Banking. Eilert received his Bachelor’s degree in Finance from Kansas State Univer-sity and his MBA from Wichita State University.

Kathy schwerdtfager, Bank of Tescott, LincolnGraduate School of Banking at Colorado State School ScholarshipPrior to joining the Bank of Tescott, Schwerdtfager served as the Vice President—Loans & Administration for Guaranty State Bank & Trust, Beloit. Schwerdtfager graduated from McPherson College with a Bachelor’s degree in Finance. She is also a 2007 gradu-ate of the Kansas Bankers Association Bank Leaders of Kansas (BLOK) program, and currently serves on the Leadership Mitchell County Board and the Bank Administration Association of Central Kansas Board.

Brian Holt, Union state Bank, UniontownProchnow Education Foundation State School Scholarship for the Graduate School of Banking at the University of Wisconsin-MadisonHolt serves as the IT Security Officer, and was recently appointed to the board of directors. Joining the bank in June of 2005, he is one of several fifth-generation fam-ily members to work in the bank. Holt graduated from Pittsburg State University with a Bachelor’s degree in Business Administration with an emphasis in Finance. He is also actively involved in various community organizations.

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Features

Cindy Kershner, Country Club Bank, Kansas CityHuman Resource Management School Scholarship at the University of Wisconsin-MadisonA lifelong Kansas resident, Kershner graduated from Emporia State University with a degree in Busi-ness Administration. She earned her certification as a Senior Professional in Human Resources (SPHR) in 2001. Kershner currently oversees all aspects of Human Resources for Country Club Bank and its subsidiaries. Kershner is also a member of the Senior Management Committee that provides stra-tegic direction for the organization. Prior to joining the bank, Kershner spent 13 years in accounting and Human Resources in the Olathe office of an international manufacturing company.

Jonathan snively, Emprise Bank, wichitaKBA/NBA Schools of Banking ScholarshipSnively joined Emprise Bank in November of 2006. He is a graduate of Friends University, earning a Bachelor’s degree in Business Administration. He currently manages a group whose duties include overseeing daily processing of insufficient funds items, resolution of non-posted items, returned de-posited items, stop payment review, Regulation CC compliance, collections, the bank’s overdraft privilege program, and fraud/kite activity monitor-ing.

Tyson Oakes, First National Bank, IndependenceAdvisory Committee Scholarship for theGraduate School of Banking at the University of Wisconsin-MadisonPrior to joining the family bank in 2007, Oakes was a consumer loan officer at Kaw Valley Bank, Topeka, for four years. Oakes attended Kansas State University and later Emporia State University where he received his degree in Busi-ness Administration.

Scholarship applications for the 2011 graduate school sessions will be ac-cepted starting November. Make plans to apply, and then contact KBA Senior Vice President Becky Tongish at [email protected] or (785) 232-3444 for more information. You can also check www.ksbankers.com in November when applications are posted to the website.

It’s almost time to apply for 2011 scholarships!

Kansas bankers and vendor representatives made up 22 teams at the 19th Annual KBA Hodge & Porter Scramble Golf Tournament May 6.

A continential breakfast, 18 holes of golf with a light wind but under gorgeous skies, a buffet of hamburgers, brats and hotdogs and an awards program was held at the Reflection Ridge Golf Club in west Wichita. Sixteen teams in four flights received awards and all players competed in seven special events. The “hot pink ball” contest was again popular and cash prizes were awarded to three winning teams. In all, 68 players received golf prizes or won a drawing for merchandise. Next year will mark the 20th year for the annual tournament. The date and location for that tournament will be announced at a later date.

Tournament results:Winning the top flight at the scramble was Brian Chamberlin, Greg Kossover, Mark Cox and Tracy Chamberlin. Other winners included: closest to the pin Hole #3, Chuck Rowland; closest #6, Bryce Brewer; closest #12, Jeff Stoppel; and

closest #14, Mike Ewy. Longest putt winners were: #9, Larry Stoppel; and longest putt #17, Christian Ofner. Longest drive #15, Cox.


Features

HODGE & PORTERannual golf event Features

H&P annual golf scramble brings bankers and vendors togetherBy Hump HodgeExecutive vice president of KBA —Hodge & Porter, Inc.

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From left to right, Hump Hodge, Jeff Wanning, Paul Porter and Ed Kizer pose prior to golfing. Wanning and Kizer work for Central States of Omaha and were tournament sponsors.


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P ICTUR ING KANSASyour photos from around kansas CONTEST

How do you picture Kansas? We want your snapshots of Kansas and Kansas events, art, curiosities, weather and more. Pictures to be sumbitted for the 2011 calendar need to be taken July 1, 2009-June 30, 2010. E-mail high-resolution digital files (300 PPI at 4” x 6” in TIFF or JPEG format) to [email protected]. We’ll also check our old-fashioned mailbox for prints: P.O. Box 4407, Topeka, KS 66604-0407.

Horse of coursePhotographed by Maureen Schwant, mother-in-law of Betty Schwant of Stockgrowers State Bank, Maple Hill, three horses move along a well-kept fence in rural Shawnee County outside of Topeka. June 30 is the deadline for submissions for the 2011 calendar. If you would like the opportunity to have your picture featured in the calendar or in The Kansas Banker, like seen above and on our cover, get those photos into [email protected] as soon as possible. If you can’t, there is always next year’s calendar.

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Co lumns

There’s no question that the regulatory burden that traditional banks must shoulder is getting increasingly heavy.

Indeed, reg burden is reaching a point where it’s literally becoming too much for traditional banks to bear. In a recent letter to Treasury Secretary Timothy Geithner, I pointed out the dra-matic growth in regulatory burden during the past two years, as well as how much the burden will expand under financial regulatory

reform. We hope the administration understands the big picture in this grim message. Traditional banks, which are working to pull their communities up from the worst financial crisis most of us have ever encountered, are under siege. Traditional banks’ regulatory burden has reached the limit, I told Geithner in my letter. This burden must be addressed if the admin-istration wants such banks to both increase lending and continue to support communities, business customers and consumers. Banks were already subject to thousands of pages of regulations be-fore the financial crisis, but that regulatory burden continues to grow, I said. During the past two years, 50 new or expanded regulations have been imposed. And the Senate’s version of the regulatory reform bill would impose another 30 new or expanded regulations. I provided the secretary with a list of these new burdens.

Little thought is given to the net effect of this trend. “There seems to be no consideration of the totality of the burden,” I said. “It is now reaching a breaking point. Many community bank leaders are telling ABA that they simply see no future for their institutions under the mound of regulatory costs they are facing.” In fact, as I was working on this column, a community banker called and told me that the decision had been made by his bank to either sell or merge simply because they thought they were too small to handle the crushing regulatory burden and other rules from Washington. I have heard that story many times in recent months. Looked at another way, as we explained in our letter, the median bank in the United States has less than 40 employees. These 80 new regulatory requirements mean that there are two new requirements for every employee in the median-size bank. A number of these new requirements contain very significant litigation risk. “This is simply out of control,” we said. Meanwhile, leaders throughout the administration, Congress and the regulatory agencies continue to call on banks to lend more while simultaneously increasing their regulatory burden, which makes it harder for banks to lend. The growing regulatory burden is an economic threat to the com-munities and customers served by traditional banks. Combined, it’s a threat to our national economy and the recovery that banks are work-ing so hard to support. This is a case where policymakers cannot have it both ways – a vibrant economy and continued regulatory pile-on.

industry news and opinions

WASHINGTON UPDATE

Regulatory burden tipping point

Ed Yingling

Columns

President of The American Bankers

Association


How do your tell-ers handle

checks made pay-able to the bank as payee? Can the check be depos-ited to some indi-vidual’s account?

Can the check be cashed? Can the check be used to purchase a cashier’s check? If you answered “yes” to any of these ques-tions, your bank could face a large loss. There are two things to consider. First, banks have experienced substantial losses (often uninsured losses) when they took checks payable to the bank and allowed such checks to be deposited into an account of someone other than the maker of the checks. The Uniform Commercial Code §3-307 (b)(2) specifically states that a bank can be held liable for repayment of the amount to the business if an employee of the business delivers a check payable to the bank and the bank allows such check to be deposited into any account other than the business’s own account. This same law also applies when any person presents a check payable to the bank on behalf of another individual and deposits such check to an account of anyone other than the maker of the check. Second, other banks have experienced substantial losses (often uninsured losses) when they took checks payable to the bank in exchange for cash or ca-shier’s checks given back to an employee of a business. In numerous cases where the business later claimed the employee misappropriated the funds, the courts found that the bank was liable for repay-ment of the amounts to the business. The following is one of many examples of court rulings on the subject. In the 1998 case of Dalton & Mayberry vs. NationsBank, an accounting firm filed an action against the bank for breach of duty to inquire as to the authority of the accounting firm’s employee to present checks payable to the bank in exchange for cashier’s checks. The Court of Appeals ruled that (1) the bank had a common-law duty to inquire as to the authority of the firm’s employee, (2) the bank was not a holder in due course and

(3) the accounting firm did not have to prove that the bank knew the cashier’s check proceeds were being used for the personal benefit of the employee. The bank was found liable. The courts have been extremely anti-bank in cases involving this subject. In February 2001, a Court of Appeals stated: “Other courts have specifically found that the payment of a check by a payee bank to an unauthorized third party without inquiry by the bank is commer-cially unreasonable as a matter of law. In charity we will withhold character-izing such conduct as ‘abject stupid-ity’ and call it merely negligence of the grossest kind. The bank’s showing that other area banks, following identical procedures, would also have allowed payment of these checks cannot alone make those procedures reasonable in contemplation of law. An entire indus-try may behave unreasonably... If for the sake of efficiency banks feel that they must forgo these prudent safeguards, they should also appreciate that they must bear the losses that result as a cost of doing business.” In that case, the bank had an unin-sured loss of over $503,000 as a direct result of the bank’s method of handling checks payable to the bank. The courts would have us believe that if a bank simply inquired as to the au-thority of an employee, the bank would not be liable. Unfortunately, this duty to inquire is something ambiguous that the court created without any guidelines. In reality, the bank would not only have to inquire, but would have to be able to document that upon inquiry the person was properly granted authority to re-ceive cash or purchase cashier’s checks using such check payable to the bank. You can see the obvious impossibility of documenting such inquiry. So, in summary, the bank cannot take a check payable to the bank and deposit it into an account of any party but the maker because of UCC §3-307. The bank cannot take a check payable to the bank in exchange for cash or cashier’s checks because of the court created “common law.” Banks should require all checks

Bank as a payee exposes bank to loss

Charles TowleSenior Vice President of Kansas Bankers Surety

SECUR I TY OFF ICER’S BYWORDindustry news and opinions ColumnsColumnsColumns

Continued on page 18

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made payable to the bank to be ap-plied to the account owner’s debt to the bank. This applies whether the check is from a corporation, LLC, partner-ship, trust, IRA, club, association or almost any other kind of account. It also applies when a check is drawn on an individual’s account if someone other than that individual is presenting the check. For instance, if a check is drawn on Mr. Smith’s personal account made payable to the bank but is presented to the bank by Mr. Smith’s son, then the same law applies. Because the presenter is a representative acting on behalf of Mr. Smith, the bank could have liability to Mr. Smith if Mr. Smith’s son uses the check to purchase a cashier’s check and then uses the cashier’s check to benefit someone other than Mr. Smith. A bank can take a check payable to the bank from a customer if it is used for the benefit of the account owner, such as payment of a loan, tax deposit or purchase of items a bank sells. For a customer to receive cash back or purchase cashier’s checks from a bank, the customer should make the check payable to “Cash” or payable to the person presenting such check. It is also acceptable to make the payee “Purchase of Cash from ABC National Bank” or “Purchase of Cashier’s Checks from ABC State Bank.” Though I personally would have logically believed that cash or cashier’s checks were items sold by a bank and a bank should be able to accept checks payable to the bank for purchase of cash or cashier’s checks, the courts have ruled that such logic is not only incorrect but results in negligence of the grossest kind. It is best to heed the rulings of the court. Therefore, we highly encourage banks to implement a rule that tellers are absolutely prohibited from accepting checks payable to the bank except for payment of a debt the account owner owes to the bank.

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Continued from page 17


Chuck Stones President [email protected]

Kathy Olsen Senior Vice President, General Counsel [email protected]

Terri Thomas Senior Vice President,Legal Department Director [email protected]

Becky Tongish Senior Vice President, Educational Resources [email protected]

Doug Wareham Senior Vice President, Government Relations [email protected]

Mike Norris Vice President of Members Services [email protected]

Sara Blubaugh Special Projects Coordinator, Advertising Manager [email protected]

Linda Brown Administrative Assistant, Legal Department [email protected]

Diane Catron Administrative Director [email protected]

Jerrie Conklin Education Assistant [email protected]

Linda Douglass Assistant Treasurer, [email protected]

Gwen Hill Staff Attorney [email protected]

Eric Jorgensen Editor [email protected]

Jackie Kuhn Vice President [email protected]

Elaine Martin Conference Coordinator [email protected]

Lynne Mills Receptionist [email protected]

Becky Milne Education Coordinator [email protected]

Connie Sherer Legal Assistant [email protected]

Julie Taylor Information Systems Coordinator [email protected]

Mary Taylor Communications Specialist [email protected]

KBA Insurance, Inc. Herb Iams President [email protected]

Becky Iams Executive Vice President [email protected]

Ed Griffith Vice President of Employee Benefits [email protected]

Susan SalyerEmployee Benefits [email protected]

KBA Hodge & Porter, Inc. Paul Porter President [email protected]

H.D. “Hump” Hodge Executive Vice President [email protected]

Kent Owens Vice President [email protected]

Linda Watson Administrative Assistant [email protected]

Nancy Smith [email protected]

Schools of Banking, Inc. Tami Shkolnick Executive Director [email protected]

Kami Murphy Assistant Director and Registrar [email protected]

KBA staff and e-mail index

Bankers’ Bank of Kansas........................inside front coverGeorge K. Baum & Company..............................page 1BankOnIT....................................................................page 3Shazam......................................................................page 5KBA Education.........................................................page 6KBA Education.........................................................page 7Jack Henry Banking.................................................page 13Butler & Associates..................................................page 14The Whitlock Co......................................................page 14Midwest Properties LLC...........................................page 14DCI............................................................................page 15Jack Henry Banking................................................page 15Kelly’s Corporate Apparel......................................page 16Jack Henry Banking................................................page 17INTRUST Bank...........................................................page 18KBS............................................................inside back coverFirst National Bank of Hutchinson.....................back cover

Ad Index

FCS’s first quarter 2010 net

income jumped 30.4 percent, or $187 mil-lion, over the same quarter last year even though average loans rose just 1.3

percent. FCS loan volume actually dropped 1.4 percent during its most recent quarter. How FCS goosed its profits raises troubling concerns about FCS finances. The biggest component of FCS’s higher net income was a $141 million (11 percent) increase in net interest income. A $75 million (30 percent) drop in its loan-loss provision was the other major component. Other income and expense items, taken together, lowered net income by $29 million. FCS boosted its net interest income largely by pulling down its funding costs faster than the average interest rate on its loans and in-vestments dropped. Comparing the first quar-ter of 2010 with the same quarter last year, the FCS’s yield on its earning assets dropped 28 basis points, while the average cost of its inter-est-bearing liabilities dropped 56 basis points, to 1.73 percent from 2.29 percent. The FCS at-tributed this sharp drop to the FCS’s “ability to more quickly reprice [its] outstanding debt in the lower interest rate environment.” What the FCS did not acknowledge is that it increased its bet that short-term interest rates will stay low for a sustained period of time. The FCS placed its bet by increasing the average maturity or time to a loan’s repricing while also using interest-rate swaps and other derivatives to shorten the effective maturity of FCS debt. In effect, the FCS reduced its reliance on longer-term funding, relative to its longer-term assets, to take greater advantage of a steep yield curve. Evidence of this greater risk-taking: Over the last year, the FCS’s interest-rate sensitivity gap (earning assets minus interest-bearing liabilities adjusted for swaps and other derivatives) for the zero to 6 months pricing interval declined $11.1 billion. Beyond the one-year pricing interval, the FCS’s positive gap increased $16 billion. These two measures indicate the magnitude by which the FCS increased its exposure to higher short-term rates. As short-term rates begin to rise, the consequent flattening of the yield curve will bite the FCS, perhaps painfully so. The FCS also has enhanced its profitability in recent quarters by trimming its loan-loss

provision even as its non-performing assets have continued to increase. From a $259 mil-lion loss provision in the third quarter of last year, the FCS cut this provision to $192 million in the fourth quarter of last year and to $171 million in the first quarter of this year even though, according to an FCS news release, the FCS continues to experience “deterioration in the credit quality of loans to borrowers in certain agricultural sectors, such as dairy and forestry.” While the FCS’s loan-loss allowance as a percentage of non-performing assets has crept up in recent quarters, rising from 35.0 percent on March 31, 2009, to 36.6 percent one year later, that percentage is still quite low given continuing problems in the sectors of the economy where the FCS takes credit risk.

why FCs wants a derivatives carve-outClearly, the FCS is using derivatives to take a major interest-rate bet to enhance its profit-ability while shrinking its loan portfolio. At March 31, 2010, the FCS had $48.23 billion of derivatives contracts in place, equal to 27.2 percent of its interest-bearing liabilities on that date. Those numbers are up from a year earlier when the FCS had $46.89 billion of derivatives, equal to 25.8 percent of its interest-bearing liabilities. The FCS also had shifted $4.43 billion of credit risk to third par-ties as of March 31, 2010. Not surprisingly, the FCS is concerned that Congress, in the pend-ing financial regulatory reform legislation, will significantly curb its use of derivatives. Accordingly, on April 20, the Farm Credit Council (the FCS trade association) sent a let-ter to Sen. Blanche Lincoln (D-AR), Chairman of the Senate Ag Committee, pleading for an exemption to any restrictions the legislation might impose on the use of derivatives by financial institutions. Specifically, the FCS seeks to be excluded from the definition of “Major Swap Partici-pant.” If $48 billion in outstanding swaps and other derivatives is not a major swap participant, then certainly almost all banks aren’t either. While the Council’s arguments for exclusion parallel those offered by banks, the FCS seeks only to exempt itself. Although the letter does not say so, the FCS effectively is trying to gain yet another competitive advan-tage over its private-sector competitors, in ad-dition to the substantial tax and interest-rate advantages the FCS already has. Hopefully Congress will not cut a special deal for the FCS in the financial-regulation legislation.

FARM CREDIT WATCH

Bert ElySenior Economist at

the American Bankers Association

FCs bets big with derivatives, and wins

industry news and opinions Columns


Education CalendarRegister and see full, regular ly updated listings of KBA education programs and events at www.ksbankers.com.

Webinars—National SeriesJune 7: The New Mortgage Business—Part 1

June 9: Safe Deposit Webinar Series: Part 2— Legal Documents & Issues

June 11: FACT ACT—New Accuracy and Integrity Rules

June 14: The New Mortgage Business—Part 2

June 17: Mobile Banking Webinar Series: Part 1—Opportunities & Risks

June 21: Dynamite Training Secrets for Everyone

June 22: Embezzlement for Investigators

June 24: ACH Risk Assessment

June 28: Mobile Banking Webinar Series: Part 2—Regulatory & Security Issues

July 1: How to Comply with Regulation Z’s Rescission Rules Seminars and ConferencesEssential Teller IssuesJune 8: Garden City, Clarion HotelJune 9: Phillipsburg, Huck Boyd CenterJune 10: Wichita, Clarion HotelJune 15: Salina, Courtyard MarriottJune 16: Parsons, VFWJune 17: Lawrence, SpringHill Suites

KBA/NBA Schools of BankingAgricultural Lending SchoolJuly 19-23: Kearney, Neb.

Gradudate Schools of BankingGraduate School of Banking at ColoradoJuly 11-23: Boulder, Co.

Human Resource Management SchoolAug. 8-3: Madison, Wis.

Gradudate School of Banking at the University of Wisconsin-MadisonAug. 8-20: Madison, Wis.

Senior Management SeminarAug. 15-20: Madison, Wis.

Chartered in 1967 by local investors and led by Coke Harlow, Community state Bank, Coffeyville, has been under the leadership of four different groups. The latest group, who purchased the bank in 2003, is helmed by President Mike Ewy. Ewy is a Bank Leaders of Kansas graduate and has served on the KBA Education Committee, which he chaired, and is a current member of the board of directors. Employees: The bank has 21 employees.

Community service: Community State Bank is very active in the Coffeyville community. It provides financial support for Re-lay for Life, the Salvation Army, Crisis Resource Center, Brown Mansion, Children’s Summer Theater, Coffeyville United Fund, Coffeyville Community College Foundation, Coffeyville Regional Medical Center Foundation, and the Coffeyville Cultural Arts and Genesis.

Book time: “In April, we read Rock, Brock, and the Savings Shock to the second graders at Community Elementary School on Teach Children to Save Day,” says Ewy. “The book was written by [FDIC Chair] Sheila Bair.” They followed up the reading session with a drawing where one second grader won a savings account at the bank.

Meet a bank: Community state Bank

Phone (785) 228-0000 - Fax (785) 228-0079 1220 SW Executive Drive - 66615 P.O. Box 1654, Topeka, KS 66601

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For more information, give us a call at (785) 228-0000. A Live, Intelligent Human Being Will Always Answer The Phone!

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June 2010 The Kansas Banker

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