Community Banking News Blog | Community Bankers of Iowa (CBI)

Iowa Legislature Update: Week Ending March 18, 2021

3/19/2021

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Iowa Senate passes bill eliminating inheritance tax, phasing income tax cuts in sooner
The Iowa Senate has unanimously passed legislation to scrap the state's inheritance tax and to phase in planned income tax cuts more quickly, advancing one of Republican Gov. Kim Reynolds' key legislative priorities. The bill, Senate File 576, passed the chamber Wednesday on a 46-0 vote, with four senators absent. It now goes to the Iowa House for consideration. Read more: Des Moines Register

Call for Support of Central Filing System Legislation
The Senate version of legislation to create a central filing system relating to security interests in farm products was previously approved in Senate State Government Committee and is now SF 486. This bill has now been referred to the Senate Ways and Means Committee since it contains a fee for filings, which makes it eligible for action until the end of the session. CBI supports this legislation, and urges members to contact their Senator and ask them to support SF 486.

Iowa Legislature Update: Week Ending March 11, 2021

3/12/2021

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Bill banning credit unions from buying banks eligible for Senate debate
Legislation that prohibits a credit union from purchasing an Iowa-chartered bank passed out of the Senate Commerce Committee last week and is now eligible for debate by the full Senate. CBI urges members to contact their Senator and urge them to support SF 530 when it comes up for debate.

The need for this legislation was brought about when Green State Credit Union purchased First American Bank in Fort Dodge in 2019 and completed the transaction without receiving the required approval from the Iowa Division of Banking (IDOB). CBI’s Board affirmed its support for this legislation at its January Board meeting, and CBI testified in favor of the legislation in a Senate subcommittee meeting on the bill. While prohibiting the purchase of a bank by a credit union, SF 530 would still allow for the sale or transfer of participations or real property assets.

Iowa Legislature Update: Week Ending Feb. 25, 2021

3/3/2021

by LS2group | View the Iowa Legislative Bill Tracker

Essential workers, disabled Iowans will receive vaccine access soon
Iowa will likely allow essential workers and people with disabilities to receive a COVID vaccine in March, now that the state is seeing a steady supply of vaccines from the federal government, Gov. Kim Reynolds said last Thursday.

“We’re finally able to generally answer the question that so many Iowans are asking, and that’s ‘when is it my turn,’” Reynolds said.

So far, the state has seen almost 620,000 vaccinations. Of those over the age of 65, an estimated 53 percent have received at least the first dose of the two-dose course of the COVID vaccine.

The next group to become eligible for the vaccine will be those considered essential workers and people with disabilities who live at home. Those groups are expected to receive vaccines in early March, with 70 percent receiving the vaccine by early April. At that time, vaccine availability could be expanded to additional groups, Reynolds said.

Rural Mainstreet Economy Stabilizes in Growth Range: Concerns Over Loan Defaults Drops Significantly

2/1/2021

January Survey Results at a Glance:

Overall index rose to its second highest reading since before COVID-19.
Bankers biggest economic concerns for 2021 are excessive inflation and higher long-term interest rates.
For the first time since 2013, Creighton’s survey has recorded four straight months of above growth-neutral farmland prices.
Farm equipment-sales index rose to its highest reading since April 2013.
Approximately 44% of bank CEOs expect low loan demand to be the greatest issue facing their banks for 2021, up from 7% last year at this time.
Only 4% of bankers indicated that rising loan defaults and bankruptcies represented their greatest concern for 2021, down significantly from the 32% in 2020 survey.

OMAHA, Neb. (Jan. 21, 2021) – For the third time in the past four months, the Creighton University Rural Mainstreet Index (RMI) climbed above growth neutral. According to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy, the index increased to its second highest level since January 2020.

Overall: The overall index for January rose to 52.0 from December’s 51.6. The index ranges between 0 and 100 with a reading of 50.0 representing growth neutral.

“Recent sharp improvements in agriculture commodity prices, federal farm support payments, and Federal Reserve’s record low short-term interest rates have underpinned the Rural Mainstreet Economy in a solid and positive growth range. However, the rural economy remains well below pre-pandemic levels,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Rural Mainstreet Farmland Prices Show Strongest Growth Since 2013: Farm Equipment Sales Highest Since June 2013

1/4/2021

December Survey Results at a Glance:

Overall index rose to its second highest reading in the past 10 months.
For the first time since June 2013, the farm equipment-sales index rose above growth neutral.
For the first time since 2013, the farmland price index rose above growth neutral for three straight months.
Bankers ranked water availability as the top 2021 farm economy issue; farm labor cost/availability was ranked as the second biggest issue or concern.
Among 10 farm concerns for 2021, farm income and farm liquidity were the two issues of least concern. Growth in agriculture income pulled farmer borrowing down for a second straight month.

OMAHA, Neb. (Dec. 17, 2020) – For the second time in the past three months, the Creighton University Rural Mainstreet Index (RMI) climbed above growth neutral. According to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy, the index increased to its second highest level in the past 10 months.

Overall: The overall index for December rose to 51.6 from November’s 46.8, but was down from October’s 53.2. The index ranges between 0 and 100 with a reading of 50.0 representing growth neutral.

“Recent improvements in agriculture commodity prices, federal farm support payments, and the Federal Reserve’s record low interest rates have underpinned the Rural Mainstreet Economy,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Iowa Legislature Update – Week Ending Mar. 13, 2020

3/13/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

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Overview/Major Events
First COVID-19 diagnoses in Iowa
Gov. Kim Reynolds activated the State Emergency Operations Center Sunday after three Iowans tested positive for coronavirus or COVID-19, the first such cases in the state. State public health officials continued to report additional Iowa cases as the week wore on. As of Thursday morning, a total of 14 Iowans had tested positive for the virus.

The people at the center of the first cases are from Johnson County and had recently been part of a cruise in Egypt. The individuals were isolated at their home to avoid transmission to others. The other diagnosis was in Pottawattamie County on the western edge of the state. State Epidemiologist Dr. Caitlin Pedati said public health officials were assessing potential exposure to additional individuals.

“These cases are an important reminder that all Iowans need to help prevent the spread of illness by washing hands frequently, staying home when ill, and covering coughs and sneezes with a tissue,” she said.

The state’s three public universities – Iowa State University, the University of Iowa, and the University of Northern Iowa – announced classes would move online for two weeks starting March 23 to help mitigate any potential spread on campus. Students were strongly encouraged to stay home during this time, although residence halls and dining services will remain open.

“We know how disappointing and disruptive this is to our students, faculty and staff,” said Iowa State University President Wendy Wintersteen in a statement. “This decision was made in consultation with the Board of Regents out of an abundance of caution to prioritize health and safety as the outbreak continues to spread and circumstances rapidly evolve.”

Iowa Legislature Update – Week Ending Mar. 6, 2020

3/6/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
Senator leads effort to help Chinese cities with Coronavirus response
Iowa Sen. Zach Nunn, R-Bondurant, is spearheading an effort to bring needed medical and food supplies to areas in Iowa’s Chinese sister cities hard hit with the coronavirus. Nunn is chairman of the Legislature’s International Relations Committee, which has been briefed on the situation in Iowa’s sister states.

“Friendship is more than a trade partnership; Iowa has a strong tradition of helping our sister-cities and fellow citizens of the world in need,” Nunn said in a statement. “Our friends are asking to help save lives and we are asking Iowans to assist in any way they are able.”

Needed supplies in those areas include medical gowns, masks, gloves, sanitizer, tissues, and monetary donations to cover shipping costs.

The Carpenters Local 106 donated safety glasses to the effort and members were honored on the Senate floor. Local leaders in Cedar Rapids, Muscatine, Davenport, Des Moines and Dubuque are also pitching in to assist.

Those wanting to donate to the effort can visit www.iowasisterstates.org.

Iowa Legislature Update – Week Ending Jan. 31, 2020

1/31/2020

by Charlotte Eby - Managing Director of Government Affairs, LS2group

View the Iowa Legislative Bill Tracker

Overview/Major Events
Trade deal praised as good for Iowa farmers and manufacturers
The North American trade deal inked this week known as USMCA earned praise from Gov. Kim Reynolds, who said it would expand markets for Iowa producers with Iowa’s top trading partners – Mexico and Canada.

“President Trump successfully negotiated a strong, balanced and reciprocal trade agreement that will benefit Iowa and the entire nation,” Reynolds said in a statement. “Years from now, USMCA will prove to be a major boost to Iowa’s economy, especially for families, farmers, manufacturers and small businesses.”

Gov. Reynolds makes appointment to the Iowa Supreme Court
Gov. Kim Reynolds this week appointed Swisher attorney Dana Oxley to serve as a new justice on the Iowa Supreme Court to fill a vacancy created by the death of Chief Justice Mark Cady last year. Oxley practices with a prominent Cedar Rapids law firm and serves as an adjunct law professor at the University of Iowa College of Law.

“Dana Oxley is an exceptional lawyer with a uniquely Iowa story,” Reynolds said in a statement announcing the appointment. “She will be a valuable new addition to the Iowa Supreme Court. I look forward to watching her serve Iowans in this important role for years to come.”

November Rural Mainstreet Index Rises to Highest Reading for 2019: Bankers Expect Holiday Sales to Grow by only 1.3% from 2018

11/25/2019

November Survey Results at a Glance:

Overall index climbs to highest reading for 2019. It also marked the fourth time in the past five months that the overall index has risen above growth neutral.
The trade war with China and the lack of passage of the USMCA are driving confidence and the economic outlook lower for most areas of the region.
On average, bankers, expect a 1.3% expansion with 17.1% of bank CEOs anticipating a decline in retail sales from last year.
Bankers reported that approximately 16.7% of farmers and 5.5% of business owners in their area had no organization succession plan.

OMAHA, Neb. (Nov. 21, 2019) – The Creighton University Rural Mainstreet Index (RMI) for November climbed above growth neutral for the fourth time in the past five months, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The overall index rose to 54.2 from 51.4 in October. Although still tepid, this is the highest reading for 2019. It also marked the fourth time in the past five months that the overall index rose above growth neutral.

“Federal agriculture crop support payments and somewhat higher grain prices have boosted the Rural Mainstreet Index slightly above growth neutral for the month. Given a continued weak rural economy, bank CEOs, on average, expect holiday buying to increase by only 1.3% above last year’s levels,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

Jeff Bonnett, president of Havana National Bank in Havana, Illinois, reported that, “The latest harvests are showing significant declines in test weights leading to the point that 2019 harvest production looks to be running below average.” Bonnett goes on to say that grain prices are still sitting at extremely low levels for such yields.

Farming and Ranching: The farmland and ranchland-price index for November increased slightly to a weak 40.4 from October’s 40.3. This is the 72nd straight month the index has remained below growth neutral 50.0.

The November farm equipment-sales index declined to 37.5 from October’s 39.7. This marks the 74th month the reading has remained below growth neutral 50.0.

October Rural Mainstreet Index Climbs Again: Trade War and Stalled USMCA Batters Economic Confidence

10/21/2019

October Survey Results at a Glance:

After falling below growth neutral in August, the Rural Mainstreet Index jumped slightly above 50.0 for September and October.
Bank CEOs across the region reported significantly lower corn and soybean yields.
Economic confidence fell to lowest level in two years.
Almost three of four bankers reported negative impacts from the trade war.
Approximately 43% of bankers support halting Federal Reserve rate hikes over the next 12 months.

OMAHA, Neb. (Oct. 17, 2019) – The Creighton University Rural Mainstreet Index (RMI) for October climbed above growth neutral, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The overall index rose to 51.4 from 50.1 in September. Although still weak, this is the highest reading since June of this year. It also marked the third time in the past four months that the overall index has risen above growth neutral.

“Federal agriculture crop support payments and somewhat higher grain prices have boosted the Rural Mainstreet Index slightly above growth neutral for the month. Even so, almost three of four bank CEOs, or 73%, reported continuing negative impacts from the trade war,” said Ernie Goss, PhD, Jack A. MacAllister Chair in Regional Economics at Creighton University’s Heider College of Business.

But as stated by Jim Stanosheck, CEO of State Bank in Odell, Nebraska, “What is happening in the economy today is exactly what voters voted for.”

Farming and Ranching: The farmland and ranchland-price index for October slumped to a weak 40.3 from September’s 43.1. This is the lowest reading since March of this year and the 71st straight month that the index has remained below growth neutral 50.0.

Jeff Bonnett, president of Havana National Bank in Havana Illinois, said, “Hopefully the true corn acres planted, and more importantly, overall yields will be made public here soon now that we are well into harvesting this year's crop. I am not sure why this is such a secret and why we do not get more accurate information based upon certification of acres planted back in July?”

The October farm equipment-sales index improved to 39.7 from September’s 35.9. This is the highest reading for the index since June of this year, but marks the 73rd month that the reading has remained below growth neutral 50.0.