Timely content and insight from key industry insiders attracted more than 500 people to GBA’s three Fall Economic Forums this month. Bankers and associate members were treated to timely regulatory updates from Rob Braswell, Georgia’s Commissioner of Banking and Finance, and broad economic analysis from Roger Tutterow, economist, Mercer University. Spread over the course of three of the most rapidly changing weeks in our industry’s recent history, Braswell’s comments ranged from lessons learned from the Integrity Bank closing, to the possible effects of the Freddie/Fannie takeover on Georgia banks holding preferred Fannie/Freddie stock and the effects of the state’s budget shortfall on his department. Tutterow gave a big-picture view of the economic situation, explained the true effects of rising energy prices on consumers (more psychological than actual) and predicted that housing would begin to make a recovery late  in 2009.

Negotiations are continuing between the Administration and Congress to reach some middle ground on President Bush's plan to address the crisis in the credit and housing markets.  If you saw the President's address to the Nation Wednesday, you heard him lay out his view of how the problem was created, who the players are, what he's proposing and what would happen if the plan passes.  He made dire predictions of the consequences if Congress fails to act.  In our conversations with Georgia's congressional delegation, the administration and those in the media covering this issue, we have been focusing on five key issues:

• Fannie/Freddie Stock.  At our Fall Economic Forums Banking Commissioner Rob Braswell told the audience the Department was aware of eight state-chartered banks with holdings in this stock, which is now substantially devalued.  A provision is being considered in the Treasury plan to alleviate this problem by allowing banks that held preferred stock and auction-rate securities in these GSEs to treat the losses as an ordinary loss for tax purposes. House Financial Services Chairman Barney Frank (D-Mass.) is pressing this issue on our behalf and we thank him for his efforts.  If this issue is important to you, please click here to use the automated letter-writing system we have partnered with the American Bankers Association to create to write our Senators and your Congressman.

• Fair Value/Mark-to-Market Accounting.  In talking with a number of our members and associate member accounting firms, the issue of fair market or mark-to-market accounting has come up often.  It is extraordinarily difficult to value assets in this economy and efforts are underway to persuade securities regulators and lawmakers to temporarily suspend or roll back the SFAS 157 accounting measure that took effect last November.  In an article in Wednesday’s Washington Post, University of Georgia accounting professor Dennis R. Beresford was quoted as saying about the measure, “It’s intended to be more or less for orderly markets.  But we don’t have orderly markets these days. It’s not so much that mark-to-market has people complaining, but marking to a particular market. Today it’s more kind of fire-sale prices.”  ABA’s President, Ed Yingling, has sent a letter to the Securities Exchange Commission that best describes the issue and also reflects our position.  

• Whole loan/bank participation in the Treasury Plan.  Most of Treasury’s focus in the plan is on mortgage-related securities.  Here’s a link to a story in Monday’s Atlanta-Journal Constitution where we and member bankers talked about the plan and how it provides little in direct support to traditional banks.  While there is additional language in the proposed bill to include other assets, the language is not prescriptive enough to ensure bank loans for acquisition, development and construction lending would be included.  Extensive efforts are being taken to qualify those loans for sale into the program which would create a more competitive market for those assets.  Commissioner Braswell has given us a copy of a letter the Conference of State Bank Supervisors sent Congress on behalf of the 50 state bank regulators asking that this be clarified.

• Bankruptcy cram-down.  Senate Banking Committee Chairman Chris Dodd (D-Conn.) and other members are pushing a provision allowing bankruptcy judges to change the terms of mortgages including reductions in principle.  GBA is adamantly opposed.  Both Georgia Senators Saxby Chambliss and Johnny Isakson have signed a letter joining us in opposing the concept.  Please thank both Senators Chambliss and Isakson at your earliest opportunity for their support of our position. Also, be sure and contact your House member to request his support of our position.  Here’s a link to the page on our website with their physical and email addresses.
   
• Money Market Mutual Fund Insurance.  Your efforts over the weekend got Treasury’s attention and their proposal to fully insure money-market mutual funds was scaled back to only the value of the accounts at the close of business last Friday (Sept. 19).  Congress will be clarifying this provision in more detail such as the amount that will finally be covered, what the funds will pay to have the insurance and other provisions. 

It's too early to make predictions about the outcome, but we will continue to press our positions throughout the process. With questions, please contact GBA's Joe Brannen, 404.420.2026 or Elizabeth Chandler, 404.420.2027.

The President, Congress, Presidential candidates and the news media continue to spotlight the current stresses on our economy and the financial services system as they work on possible solutions. Some of that spotlight includes discussion of possible consequences related to their proposals. This, naturally, creates cause for concern among our customers. So, it remains vital that we all continue to help consumers understand the big picture and underlying soundness of our state and national commercial banking and savings system. It remains more important than ever to make sure people get accurate facts about the security of their funds that are on deposit with banks. In an example of the opposite, a Bloomberg news story Sept. 25 inaccurately reported about the FDIC’s pre-existing lines of credit with the U.S. Treasury for providing short-term coverage of the bank-funded FDIC insurance pool.

The U.S. House this week passed a credit-card reform bill that we believe will ultimately make credit more expensive and harder to get for people and businesses. H.R. 5244, dubbed by advocates as the "Credit Cardholders' Bill of Rights," would allow cardholders to cancel cards when faced with rate increases while paying off existing balances at agreed-to rates; prohibit retroactive rate increases on existing balances; and require payments made by 5 p.m. EST on a bill's due date to be credited for that day.

A strong field is assembling for Leadership GBA’s eighth-annual Georgia BankPAC Classic slated for Wednesday, Oct. 22, at Kinderlou Forest Golf Club in Valdosta. Don’t miss out on your spot and help fund our PAC campaign. Registration for this two-person scramble tournament is $300 per team or $150 per

In 2006 Wal-Mart was the object of the largest negative public relations assault in corporate history. Their employees and customers were sick of them. Their stock price sat at a seven-year low. The storm clouds could not have been darker. Two years later Wal-Mart's stock price is one of the few bright spots in the Dow, customer satisfaction is up, and most of their 2 million employees seem happy to work there. What was Wal-Mart's PR strategy, and how did it evolve? How did Wal-Mart communicate with its employees to make them more positive about the company and its prospects? What message did the company convey to the 130 million customers who walk through its doors every week?

The banking industry has been in the media spotlight of late and customers have a lot of questions about the overall health of the industry. This year’s Marketing Conference, scheduled for October 23-24 at Brasstown Valley Resort in Young Harris, will provide attendees with insight about how best to communicate to media,

The 2008 session of the Southern Operations and Technology School is Nov. 2-7 at The University of Georgia. In addition to the school’s top-quality curriculum, students complete a home-study project between sessions that reinforces concepts learned during the on-campus sessions.

GBA’s Credit Conference is scheduled for Nov. 18-19 at the Cobb Galleria Centre in Atlanta. John McKinley, McKinley Consulting, will deliver the keynote address. General sessions include an economic forecast, a regulatory panel discussion, a legal issues update and a collateral liquidation panel discussion. The concurrent sessions will cover collateral maintenance and a Southeast and Atlanta new-housing-market update.

GBA will host its Advanced Loan Documentation seminar Oct. 28 at Idle Hour Country Club in Macon. 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. Taught by Mike Allen, President & CEO of Georgia Trust Bank in Buford, this one-day program will tackle the prevention of loan losses through implementation of proper loan structuring and documentation techniques. This course will also focus on more complex and problematic lending transactions. Some of the topics to be discussed include:

• Background and review

• Guarantees

• Specific collateral types

• Commitment letters vs. proposal letters

• Term loan agreements

• Asset based lending basics

• Appraisals

• Special challenges that put your lien at risk.

The following AIB online classes begin the week of Oct. 20. 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

• 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

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

• Analyzing Financial Statements*, 16 weeks, $485

• Financial Accounting*, 16 weeks, $485

• Introduction to Agricultural Lending, 8 weeks, $375

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

• Principles of Banking, 16 weeks, $405

• Problem Loan Workouts, 6 weeks, $315

• Trust Basics, 16 weeks, $405

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

Just a reminder that GBA will offer the following webinars the week of Oct. 6:

• Call Report for Banks - Highlights & Pitfalls – Oct. 7

• Workplace & Social Violence, Pt. 1: Issues for Security Officers – Oct. 7

• Building Multigenerational Work Teams: A Look at the 21st Century Workforce – Oct. 8

• Rollovers and Transfers – Qualified Plans vs. IRAs – Oct. 9

The Department of Banking and Finance at the Terry College of Business of the University of Georgia is seeking candidates to fill the Georgia Bankers Association Chair of Finance, which is endowed by the Georgia Bankers Association. The Department is seeking candidates with exceptional research records in Finance, demonstrated classroom excellence and evidence of a capacity for intellectual  

Competent, skilled bankers hold the keys to guiding your bank through tough times. Each and every member of your team needs to know exactly what his or her responsibilities are and exactly what key competencies are needed to succeed. GBA Strategic Partner TalentQuest has produced a special white paper study available for download that defines just how important it is for you to ensure consistent criteria for hiring, developing and managing your teams. “Competency models function as the foundation for talent and performance management activities within an organization. They establish the objective criteria to select candidates for a position, to measure incumbents in that position and to guide the development priorities of employees who wish to excel in that position,” says Jon Naphin of TalentQuest. It’s a good read. And, once you see how important this issue is, there’s good news for you.

There are only a few copies of the Summer 2008 Georgia Financial Directory left in stock. The directory provides you with quick access to information on all commercial banks and thrifts  

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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. 

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