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Wednesday, June 30, 2010
WOMEN WHO BEHAVE........
Sent from my Verizon Wireless BlackBerry
Sarah Wallace, First Federal Savings, Wall Street Journal
I have probably infringed on The Wall Street Journal's copyright regulations, but thought it was worthwhile to be posted:
The End of Community Banking
Creditworthy borrowers will be denied loans as small banks devote more and more energy to regulatory compliance.
By SARAH WALLACE
The comprehensive financial reform agreed upon by the House and Senate on Friday, along with all the new regulations of the past year, could signal the end of community banking. The new reforms will give more power to the Federal Reserve to regulate how my bank and others like it do business.
What does all this mean for our customers? Less credit will be available, costs will increase, and we will be less able to make loans to regular people who were creditworthy in the past. This is the perfect storm for the small retail banking customer. We will start to see more small community bank failures and mergers because of voluminous regulation.
I have served as the president and now the chair of the board of directors of First Federal Savings and Loan Association in Newark, Ohio, since 1980. First Federal is a $200 million, federal mutual thrift. We were created to provide people a safe place to deposit their money, and loan that money back into the community in order to meet housing needs. Additionally, we utilize a significant portion of our profits to give (yes, I said give—not lend) to worthy community organizations and projects.
Our business model is narrow. We have 55 employees. We are mortgage lenders and providers of retail deposit services. We have always been a major housing lender for low and moderate income workers in our community. Our borrowers work in government, agriculture, manufacturing, education and the medical profession, like any small community in the United States. For 76 years, this business model has served us, and most importantly, the people in our community very well.
Here is the problem as I see it. First Federal lends to creditworthy folks who for decades have been well-served by bankers who understand their market and can think creatively to structure credit appropriately. It is what community bankers do. Going forward, we will no longer be able to evaluate loan applications based solely on the creditworthiness of the borrower. We will be making regulation compliance decisions instead of credit decisions. This is not in the best interest of the consumer.
I have said to our employees many times, "We are in the business of helping people!" Sometimes, bad things happen to good people, people we see in the grocery store and at Little League baseball games. We used to believe that if someone hit a bump in the road of life and came to us for financing, we could often figure out a way to help them. I fear this kind of community-oriented banking will end. There will be creditworthy borrowers who will no longer be able to get loans.
Recently, a couple came to us wanting to refinance their home. They were paying a relatively high interest rate (by today's standards) to a competing institution. They had reasonably good equity in their residence and owned a couple of rental properties, also with good equity. One borrower worked in the construction field and had experienced a reduction in income over the past couple of years, causing some recent slow payments on their credit report. After verifying the income and assets of the borrowers, an idea not new to us, we decided to deny the loan.
An argument could have been made to grant the loan because of the good equity position and due to the fact that we would have been lowering their monthly payment. However, fear of regulatory criticism through the federal examination process and potential money penalties associated with noncompliance were the overriding factors, causing the loan to be denied.
I had another customer stop in my office the other morning to ask how I thought the new bill would affect bank fees on checking accounts. My short answer was they will become more expensive, due in large part to the change in interchange fee regulation. It is estimated that banks on average will experience a 75% reduction in interchange fee income. In small banks like ours, interchange income offsets the expense associated with providing the service of electronic banking. Institutions will be faced with one of two choices: Either increase fees on checking accounts and continue to offer electronic banking, or stop providing the service altogether.
We all know the employees needed to provide banking services to deposit and loan customers: the manager, the teller, the back-office folks who balance the books, the loan officers and the customer-service representatives. In order to comply with the volumes of new regulation—and small banks are required to comply with the same consumer regulations that apply to the Wall Street banks—we will need to have a proportionately higher number of employees working day after day to interpret and implement all the new federal rules. This in itself, because of the sheer volume, has the potential to destroy community banking. Large banks have entire departments devoted to regulation compliance on a full-time basis; we have one employee, like most institutions our size.
The safety and soundness of our nation's small financial institutions is dependent on our being able to be profitable and add to our capital base. Small community financial institutions care about the people in their communities. Unfortunately, the new financial regulatory reform bill will greatly inhibit our ability to help them.
Mrs. Wallace is chair of the board of directors of First Federal Savings and Loan Association in Newark, Ohio.
Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved
Thank you to my sister Robin for sending this and to the Wall Street Journal for publishing this editorial.
The End of Community Banking
Creditworthy borrowers will be denied loans as small banks devote more and more energy to regulatory compliance.
By SARAH WALLACE
The comprehensive financial reform agreed upon by the House and Senate on Friday, along with all the new regulations of the past year, could signal the end of community banking. The new reforms will give more power to the Federal Reserve to regulate how my bank and others like it do business.
What does all this mean for our customers? Less credit will be available, costs will increase, and we will be less able to make loans to regular people who were creditworthy in the past. This is the perfect storm for the small retail banking customer. We will start to see more small community bank failures and mergers because of voluminous regulation.
I have served as the president and now the chair of the board of directors of First Federal Savings and Loan Association in Newark, Ohio, since 1980. First Federal is a $200 million, federal mutual thrift. We were created to provide people a safe place to deposit their money, and loan that money back into the community in order to meet housing needs. Additionally, we utilize a significant portion of our profits to give (yes, I said give—not lend) to worthy community organizations and projects.
Our business model is narrow. We have 55 employees. We are mortgage lenders and providers of retail deposit services. We have always been a major housing lender for low and moderate income workers in our community. Our borrowers work in government, agriculture, manufacturing, education and the medical profession, like any small community in the United States. For 76 years, this business model has served us, and most importantly, the people in our community very well.
Here is the problem as I see it. First Federal lends to creditworthy folks who for decades have been well-served by bankers who understand their market and can think creatively to structure credit appropriately. It is what community bankers do. Going forward, we will no longer be able to evaluate loan applications based solely on the creditworthiness of the borrower. We will be making regulation compliance decisions instead of credit decisions. This is not in the best interest of the consumer.
I have said to our employees many times, "We are in the business of helping people!" Sometimes, bad things happen to good people, people we see in the grocery store and at Little League baseball games. We used to believe that if someone hit a bump in the road of life and came to us for financing, we could often figure out a way to help them. I fear this kind of community-oriented banking will end. There will be creditworthy borrowers who will no longer be able to get loans.
Recently, a couple came to us wanting to refinance their home. They were paying a relatively high interest rate (by today's standards) to a competing institution. They had reasonably good equity in their residence and owned a couple of rental properties, also with good equity. One borrower worked in the construction field and had experienced a reduction in income over the past couple of years, causing some recent slow payments on their credit report. After verifying the income and assets of the borrowers, an idea not new to us, we decided to deny the loan.
An argument could have been made to grant the loan because of the good equity position and due to the fact that we would have been lowering their monthly payment. However, fear of regulatory criticism through the federal examination process and potential money penalties associated with noncompliance were the overriding factors, causing the loan to be denied.
I had another customer stop in my office the other morning to ask how I thought the new bill would affect bank fees on checking accounts. My short answer was they will become more expensive, due in large part to the change in interchange fee regulation. It is estimated that banks on average will experience a 75% reduction in interchange fee income. In small banks like ours, interchange income offsets the expense associated with providing the service of electronic banking. Institutions will be faced with one of two choices: Either increase fees on checking accounts and continue to offer electronic banking, or stop providing the service altogether.
We all know the employees needed to provide banking services to deposit and loan customers: the manager, the teller, the back-office folks who balance the books, the loan officers and the customer-service representatives. In order to comply with the volumes of new regulation—and small banks are required to comply with the same consumer regulations that apply to the Wall Street banks—we will need to have a proportionately higher number of employees working day after day to interpret and implement all the new federal rules. This in itself, because of the sheer volume, has the potential to destroy community banking. Large banks have entire departments devoted to regulation compliance on a full-time basis; we have one employee, like most institutions our size.
The safety and soundness of our nation's small financial institutions is dependent on our being able to be profitable and add to our capital base. Small community financial institutions care about the people in their communities. Unfortunately, the new financial regulatory reform bill will greatly inhibit our ability to help them.
Mrs. Wallace is chair of the board of directors of First Federal Savings and Loan Association in Newark, Ohio.
Copyright 2009 Dow Jones & Company, Inc. All Rights Reserved
Thank you to my sister Robin for sending this and to the Wall Street Journal for publishing this editorial.
Tuesday, June 29, 2010
YELLOW SHIRTS
As Rodney Dangerfield quipped, “When I told my dentist my teeth were going yellow, he told me to wear a brown tie.” Personally, navy, blue, green and some red ties all look terrific with our yellow shirt, as does a blue blazer, a blue or grey suit, and many old tweed jackets.
White: 48%
Blue: 38%
Pink: 9%
Yellow: 5%
Blue: 38%
Pink: 9%
Yellow: 5%
Sunday, June 27, 2010
LICKING COUNTY IMPRESSIVE BUSINESSES
Thank you to Chat with the Chamber for publising the following:
DID YOU KNOW....
. . . these things about the businesses in Licking County?
Licking County is an economic powerhouse. Licking County hosts Central Ohio's largest manufacturing corridor with 11 million s.f. of buildings, 1,000+ acres, rail/inter modal, manufacturing-oriented, capacity for growth, and four of Central Ohio's 25 largest industrial parks.
Licking County is a haven for the advanced materials industry in Ohio. In an area defined by I-70, SR 16, SR37 and SR79 is a diverse presence of the advanced materials industry with polymers, steel, aluminum, micro electronics, wood, ag/bio, organics, food, foam, silicon and other advanced processes.
Licking County is where many global products are born. Product development for next generation manufactured goods is found in abundance here. Owens Corning, Momentive Performance Materials, Bayer MaterialScience, Holophane, Boeing, Goodrich and Screen Machine are among the companies that are engineering and producing next generation products in facilities found in Licking County.
Many unique-to-the-world capabilities are found in Licking County's backyard. Kaiser aluminum's plant in Heath has the only hot roll aluminum process in the world. Boeing's AWACS-ESM anechoic chamber is one-of-a-kind. NATO tried to duplicate it once and couldn't. Samuel Manu-Tech has North America's only heat treat line that uses bizmuth to anneal steel instead of lead.
Licking County has defied the axiom that people won't relocate from the sun belt to the so-called rust belt. Boeing moved a workload from Dallas, TX. They have also attracted key leadership from California and Georgia.
For those who live and work here, this should make you stand taller. For those who don't - why don't you?
Thanks Rick.
DID YOU KNOW....
. . . these things about the businesses in Licking County?
Licking County is an economic powerhouse. Licking County hosts Central Ohio's largest manufacturing corridor with 11 million s.f. of buildings, 1,000+ acres, rail/inter modal, manufacturing-oriented, capacity for growth, and four of Central Ohio's 25 largest industrial parks.
Licking County is a haven for the advanced materials industry in Ohio. In an area defined by I-70, SR 16, SR37 and SR79 is a diverse presence of the advanced materials industry with polymers, steel, aluminum, micro electronics, wood, ag/bio, organics, food, foam, silicon and other advanced processes.
Licking County is where many global products are born. Product development for next generation manufactured goods is found in abundance here. Owens Corning, Momentive Performance Materials, Bayer MaterialScience, Holophane, Boeing, Goodrich and Screen Machine are among the companies that are engineering and producing next generation products in facilities found in Licking County.
Many unique-to-the-world capabilities are found in Licking County's backyard. Kaiser aluminum's plant in Heath has the only hot roll aluminum process in the world. Boeing's AWACS-ESM anechoic chamber is one-of-a-kind. NATO tried to duplicate it once and couldn't. Samuel Manu-Tech has North America's only heat treat line that uses bizmuth to anneal steel instead of lead.
Licking County has defied the axiom that people won't relocate from the sun belt to the so-called rust belt. Boeing moved a workload from Dallas, TX. They have also attracted key leadership from California and Georgia.
For those who live and work here, this should make you stand taller. For those who don't - why don't you?
Thanks Rick.
Friday, June 25, 2010
Downtown Newark Ohio Final Friday
Sent from my Verizon Wireless BlackBerry
Wednesday, June 23, 2010
Bruce Humphrey
The first photo of myself ever to be published in the Newark Advocate, was taken by Bruce Humphrey. I must have been about 3rd grade, the photo of myself and a girl (who I have wonder who she was) was publicity for the Newark Area Jaycee's upcoming Pancake Day.Seeing Bruce for the first time, I thought he looked like a "beatnik" or a Maynard G. Krebs type due to his hair cut and beard. Throughout the years, he has always been very visible around town, during the past five or six years his blogging in the Newark Advocate and his personal blog site (click here) I read.
Never agreeing with his thoughts on how the city, county, federal governments or school systems should be operated. In fact he always gave me ammunition to argue with and raised my blood pressure once in a while. But, he was not scared of saying what he thought be it right or wrong.
His part of Licking County history was published today via his obituary, click here to learn more about Bruce.
Monday, June 21, 2010
MEN, WOMEN AGREE IN HOME 'MUST-HAVES'
It's true. Men aren't looking for exactly the same things women are when they go home shopping.
ZipRealty surveyed 1,000 home shoppers and concluded that while about an equal number of men and women sought green features, 27% and 35% respectively put a high priority on a home office. Both sexes did agree on the biggest turn-offs: structural damage, bad odors, a busy street, and an awkward floor plan.
Here are the top 10 features most desired by men:
Garage or designated parking space, 85.5%
Master suite, 79.8%
Ample storage space, 71.2%
Guest bedroom, 70.2%
Large closets, 64.2%
Outdoor entertainment area, 63.4%
Gourmet or updated kitchen, 59.1%
Breakfast room or eat-in kitchen, 55.2%
View, 44.5%
Large yard, 43%
Here are the top 10 features most desired by women:
Garage or designated parking, 87.7%
Master suite, 77.8%
Ample storage space, 72.7%
Large closets, 68.7%
Outdoor entertainment area, 64.2%
Guest bedroom, 63.9%
Gourmet or updated kitchen, 61.8%
Breakfast room or eat-in kitchen, 56.1%
Large yard, 43%
Wood floors, 40.9%
Reprinted from REALTOR Magazine Online www.realtor.org with permission of NAR. Copyright 2010. All rights reserved.
ZipRealty surveyed 1,000 home shoppers and concluded that while about an equal number of men and women sought green features, 27% and 35% respectively put a high priority on a home office. Both sexes did agree on the biggest turn-offs: structural damage, bad odors, a busy street, and an awkward floor plan.
Here are the top 10 features most desired by men:
Garage or designated parking space, 85.5%
Master suite, 79.8%
Ample storage space, 71.2%
Guest bedroom, 70.2%
Large closets, 64.2%
Outdoor entertainment area, 63.4%
Gourmet or updated kitchen, 59.1%
Breakfast room or eat-in kitchen, 55.2%
View, 44.5%
Large yard, 43%
Here are the top 10 features most desired by women:
Garage or designated parking, 87.7%
Master suite, 77.8%
Ample storage space, 72.7%
Large closets, 68.7%
Outdoor entertainment area, 64.2%
Guest bedroom, 63.9%
Gourmet or updated kitchen, 61.8%
Breakfast room or eat-in kitchen, 56.1%
Large yard, 43%
Wood floors, 40.9%
Reprinted from REALTOR Magazine Online www.realtor.org with permission of NAR. Copyright 2010. All rights reserved.
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