One of the takeaways from Georgia Banking and Finance Commissioner Rob Braswell’s remarks to members at our recent Fall Economic Forums was the need in the current environment for banks to remain respectful competitors in their efforts to attract and retain customers. He’s hearing anecdotally, as are we, that some banks may be aggressively pointing out real or perceived difficulty at competing banks as a business development tactic.

One of the key issues our members and banking associations have been working with Congress and regulators on during negations on the economic rescue legislation is some relief from fair-value accounting standards. The SEC Sept. 30 issued some key guidance and clarifications that is a good start. The guidance addresses the following key questions.

• Can management’s internal assumptions (e.g., expected cash flows) be used to measure fair value when relevant market evidence does not exist?

• How should the use of “market” quotes (e.g., broker quotes or information from a pricing service) be considered when assessing the mix of information available to measure fair value?

• Are transactions that are determined to be disorderly representative of fair value?  When is a distressed (disorderly) sale indicative of fair value?

• Can transactions in an inactive market affect fair value measurements?

• What factors should be considered in determining whether an investment is other-than-temporarily impaired?

To further emphasize the importance of mark-to-market for our members, we also asked the Georgia delegation to sign a letter to SEC Chairman Cox in support of suspending mark-to-market, and five members signed that letter:  Lynn Westmoreland, Hank Johnson, Nathan Deal, John Linder and Paul Broun. 

We continue to monitor this issue and to seek encourage further fair-value accounting relief on your behalf. With questions, please contact GBA’s Elizabeth Chandler, 404.420.2027.

Increased media coverage of Georgia’s foreclosure process is not only reflective of the current housing market, but also of the fact that Georgia’s General Assembly will meet again in January and the intention of some groups is to once again attempt changing state law. In a recent article in the Atlanta Journal Constitution, the link between Georgia’s increased bankruptcy filings being a result of increased foreclosures was drawn to illustrate bankruptcy advocates’ point that a debtor’s only relief from foreclosure is to file for bankruptcy. We anticipate legislative attempts in January to change our foreclosure laws into more of a judicial system than the current non-judicial system, and this is the latest argument from certain advocacy groups.

The FDIC facilitated and assisted acquisitions of Washington Mutual by JP Morgan Chase and Wachovia by Citigroup brought the financial market turmoil close to home for large numbers of Georgians who have accounts at WaMu and Wachovia. Wachovia is the state’s second-largest bank by deposits, with more than 300 branch locations statewide. While WaMu’s retail presence is smaller, many Georgians have mortgages with the company. Because of the banks’ large presence, heavy media interest accompanied the announcements. While it is not GBA’s usual approach to discuss specific effects of mergers or acquisitions for specific customers 

Last week we reported on a couple of examples of how our bankers have been doing a good job of explaining to their customers through the media specific information about the soundness of their banks as well as the overall industry. We caught some other bankers in the act of that this week, too. Despite an inaccurate paraphrase of a GBA quote, an article in the Coastal Courier featured Mike Odom, Division President, The Coastal Bank, Hinesville, Jim Floyd, President, The Heritage

Since putting in place protective measures for money market mutual funds, the Treasury has issued clarification of how the program will work. The most significant points are that the Treasury’s commitment is only for fund balances on recorded at the close of business Sept. 19. And, any fund that participates will pay a fee to participate. Below are some of the clarifications. Click here for a set of frequently asked questions from the Treasury Department.

• The guarantee will be triggered if a participating fund's net asset value "breaks the buck" or falls below $0.995.

• To participate in the voluntary program, MMMFs with a net asset value per share greater than or equal to $0.9975 at the close of business on Sept. 19, 2008, will be required to pay an upfront fee of 1 basis point per share outstanding. Funds with a net asset value per share between $0.995 and below $0.9975 as of the cutoff date will be required to pay an upfront fee of 1.5 basis points per share outstanding. The fees will cover only the first three months of program participation.

• The program will exist for an initial three-month period. Then the Treasury secretary, after a review, will decide whether to extend the program for some period up to a year.

• The guaranty applies only to money that was invested in the MMMF at the close of business on Sept. 19, 2008. The guidance clarifies that no new investments in MMMFs will be covered unless the new investment is to replace shares held in the fund as of the cutoff date. An investor cannot receive a guaranty in excess of the shares held in the fund as of Sept 19, 2008.

The major bank regulators are seeking public comment on a proposed change to Goodwill accounting standards. The proposal would allow goodwill, which must be deducted from Tier 1 capital,

The Department of Housing and Urban Development’s Hope for Homeowners program to help homeowners refinance loans to avoid foreclosure went into effect Oct. 1. This program was part of the Economic and Housing Recovery Act of 2008 signed into law July 30. "For families struggling to keep up with their mortgage payments, this program will be another resource to refinance into a loan they can afford," said HUD Secretary Steve Preston.

The Federal Home Loan Bank of Atlanta announced Sept. 29 its third quarter dividend of 2.89 percent. This rate is equal to average three-month LIBOR (London Interbank Offered Rate) for the period July 1, 2008, to Sept. 29, 2008. The dividend is applicable to capital stock held during the period of July 1, 2008, to Sept. 30, 2008, and will be credited to members’ daily investment accounts at close of business on Oct. 1, 2008.

Since the last Bulletin, the following companies have contributed to the GBA StatePAC:

• Century Bank of Georgia, Cartersville, Rick Drews, CEO

• First State Bank of Randolph County, Cuthbert, Charlie Curry, CEO

• Independent Bankers' Bank, Lake Mary, William Dacko, SVP

The officers, directors and staff of the following companies have contributed to the GBA FedPAC:

• Northwest Georgia Bank, Ringgold. Wes Smith, CEO

• First Chatham Bank, Savannah, Brian Foster, CEO

Please see the BankPAC Campaign Update for total contributions by group. For more information, please call Elizabeth Chandler at 404.420.2027.

Don’t miss out on your spot and help fund our PAC campaign by attending Leadership GBA’s eighth-annual Georgia BankPAC Classic slated for Wednesday, Oct. 22, at Kinderlou Forest Golf Club in Valdosta. Registration for this two-person scramble tournament is $300 per team or $150 per person, with the proceeds being donated to the GBA StatePAC.

The easiest way for a bank marketer to be a hero to his or her CEO is to accurately measure the results of marketing campaigns and to quantify the return on the bank’s investment in marketing. Learn the latest techniques and concepts for measuring return on investment for your marketing efforts at the annual GBA Marketing Conference, scheduled for Oct. 23-24 at Brasstown Valley Resort in Young Harris.

GBA’s Credit Conference, scheduled for Nov. 18-19 at the Cobb Galleria Centre in Atlanta, features two concurrent sessions of timely interest. Our Southeast and Atlanta New Housing Markets Update will provide a risk management overview of the Atlanta and Southeast housing markets. Eugene James of Metrostudy in Atlanta will include the results of Metrostudy’s proprietary quarterly survey of all new for-sale housing in the 22 county metro-Atlanta area.

The Southern Operations & Technology School is the most comprehensive resource in the Southeast for bank operations and technology training. The primary goals of the school are to strengthen management skills, increase awareness of regulatory and compliance issues, expose students to current and future technologies and products, develop an understanding of the   

Just a reminder that GBA will host its Allowance for Loan and Lease Losses Workshop on Thursday, Oct. 16, at Idle Country Club in Macon. Led by Donny Luker and the team at Mauldin & Jenkins, LLC, Atlanta, this one-day seminar will bring you up to

Do you have commercial loan personnel that needs training on complex and problematic lending transactions?  If so, GBA’s Advanced Loan Documentation seminar scheduled for Tuesday, Oct. 28, at Idle Hour Country Club in Macon is for you. This is a follow-up course to Loan Documentation for Lenders and is designed for commercial loan officers, commercial loan personnel, loan assistants and closing specialists.

The following instructor-led AIB online classes begin the week of Oct. 27. Please register two weeks in advance to secure a seat in the class. These courses are instructor-facilitated with weekly assignments, and can be taken from the comfort of your home or the convenience of your office. All you need is a computer, printer and Internet access. (Classes with an asterisk * require Microsoft Excel Software.)

• ABA Online Review Course for the CTFA Exam (open enrollment), 12 weeks, $795

• Consumer Lending, 16 weeks, $405

• Principles of Banking, 16 weeks, $405

• Today's Teller: Developing Basic Skills* (open enrollment), 8 weeks, $315

• Commercial Lending, 16 weeks, $405

• General Accounting*, 16 weeks, $485

• Law & Banking:  Applications, 16 weeks, $455

• Managing Funding, Liquidity, and Capital, 6 weeks, $595

• Principles of Banking, Accelerated, 10 weeks, $335

Please see the AIB Online Course Schedule for a complete listing or call GBA’s Alison Moreau at 404.420.2034 with questions.

Employment Law Compliance, Inc. is a Strategic Partner of the Georgia Bankers Association and our primary resource to provide employee handbooks, toolkits, affirmative action plans and other compliance products specifically designed for community banks. Keeping up with changing employment regulations and human resources best practices can be time consuming.  Monitoring changes specific to the banking industry adds even more effort to the task. Employment Law Compliance focuses on the needs of community banks that do not have the luxury of a large HR staff or in-house employment counsel.

MSI, a division of Fidelity Information Services and a new Strategic Partner of the GBA, is one of the most trusted industry leaders in browser-based CRM software for community financial institutions.  CONNECTIONS, MSI’s comprehensive CRM solution allows institutions to consolidate data into one comprehensive database with more capabilities and flexibility than traditional methods.  CONNECTIONS features include profitability,

Improve Your Bottom Line With GBA Services, Inc. Offerings

Please remember to include the Georgia Bankers Association on the list of recipients for announcements about promotions, new employees and special recognition your bank has received. 

Congratulations to two GBA members for their recent recognition in the Atlanta Business Chronicle as being among the ‘2008 Best Places to Work:’ Bank of North Georgia, Alpharetta, Kessel Stelling, CEO, in the large employer category (No. 3) and The Peoples Bank, Winder, Chris Maddox, CEO, in the medium employer category (No. 6).

Please welcome the newest member of the GBA staff. Levi Crabtree began working with us as our Member Relations Assistant this week. Levi will work directly with Chad Wilson, Senior Vice President, Member Services, and Mandy Richards, Director, Retirement Services. His responsibilities include working to enhance our Strategic Partner program, working to support our member relations efforts, marketing GBA Services to the membership and marketing GBA Retirement services to our banks and their employees.

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