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

Rural Mainstreet Economy Records Slow Growth for February: Nine of Ten Bankers Gauge Ethanol as Important to Economy

2/20/2023

February 2023 Survey Results at a Glance:

For a third straight month, the region’s overall economic reading hovered slightly above growth neutral, indicating slow growth.
Farmland prices have now advanced for 29 straight months.
Farmers have expanded their purchases of farm equipment for 25 of the past 27 months.
In 2022, the 10-state region accounted for approximately three-fourths of all U.S. ethanol production.
- Roughly 91.3% of bankers with an ethanol plant in their economy indicated that it was an important industry for their local economy.
- Only 7.7% of bankers surveyed have an ethanol plant in their economy and rank it as a relatively unimportant industry in their area.
Approximately 63.0% of bank CEOs support capture and sequestration of CO2 from ethanol plants in their area provided farmers receive adequate compensation for pipelines crossing their farmland.

OMAHA, Neb. (Feb. 16, 2023) -- For a third straight month, the Creighton University Rural Mainstreet Index (RMI) climbed above the growth neutral threshold, 50.0, according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The region’s overall reading in February remained above the growth neutral threshold. The February index declined to 50.1 from 53.8 in January. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.

Rural Mainstreet Economy Begins 2023 on Solid Note: Bank CEOs Rank Higher Input Prices as Greatest Farm Threat

1/23/2023

January 2023 Survey Results at a Glance:

After six consecutive months of below growth neutral readings, the region’s overall economic reading rose above the growth neutral threshold for a second straight month.
In terms of 2023 threats to farms in their area, bank CEOs ranked higher input prices as the greatest threat, followed by higher interest rates.
In terms of 2023 threats to rural bankers, bank CEOs ranked low loan demand as the greatest threat to rural banks, followed by rising regulatory costs.
Farmland prices continued to expand.
Despite higher interest rates, solid farm income pushed farm equipment sales higher.

OMAHA, Neb. (Jan. 19, 2023) -- After six straight months of below growth neutral readings, the Creighton University Rural Mainstreet Index (RMI) climbed above the growth neutral threshold, 50.0, for a second consecutive month, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.

Overall: The region’s overall reading in January rose above the growth neutral threshold. The January index climbed to 53.8 from 50.1 in December. The index ranges between 0 and 100, with a reading of 50.0 representing growth neutral.

CBI Member Article: "Blanket Ag Liens" Have Holes

1/17/2023

by John E. Lande, Attorney
Dickinson Law

This blog has previously covered the problems that agricultural supply dealer liens pose for financial institutions with “blanket” liens on agricultural operations. Last Friday, the Iowa Supreme Court affirmed yet another example of how numerous those holes in the blanket are in Quality Plus Feeds, Inc. v. Compeer Financial, FLCA.

The case began like so many cases of agricultural distress. The case revolved around a dairy farm that hit hard times. The primary lender, Compeer Financial, lent approximately $16 million, and was secured by blanket liens on farm products and real estate mortgages.

2023 CBI Event Dates

1/2/2023

CBI holds and sponsors a number of informative and entertaining events throughout the year, intended to educate our members, provide networking opportunities, raise funds for educational and advocacy efforts, and support the professional development of Iowa's community bankers. Below is a schedule of dates for major CBI events tentatively being held during 2023. This is not an exhaustive list of all future live events, and dates/locations and times are subject to change.

PLEASE REFER TO THE CBI NEWS PAGE OR OTHER CBI PUBLICATIONS FOR THE LATEST INFO.

Member Article: Succession Planning and Shareholder Agreements

12/12/2022

By J. Marc Ward and Grace Bogart | Fredrikson & Byron, P.A.

Shareholder agreements are an important piece of any bank’s succession plan. Without them they run the risk of in-fighting, loss of control, and lawsuits. Lack of succession planning too often has resulted in squabbles among family members over the ownership, control, and future of the family bank. Mothers have sued sons, sisters have sued brothers, and brothers have sued each other. The foregoing are all true cases involving family businesses that neglected to have shareholder agreements.

How does a shareholder agreement, also commonly referred to as a buy-sell agreement, work? The shareholders of a bank holding company (“BHC”) sign an agreement that restricts how the shares of the holding company can be sold or otherwise transferred. The agreement explains what happens to the stock in the event of death, disability, bankruptcy, and divorce of the shareholders. If employees own stock, the agreement should require the sale of their stock back to the company upon termination of employment.

Community Bank Index (QCBI) State Performance Trends: 2022Q3

11/18/2022

compiled by CBI Endorsed Member QwickRate

STATE OF THE STATE: IA 3rd Quarter 2022
Key industry trends for the "true" community bank.

Click each image to view larger, or download the entire report (PDF, 1MB)

Download Full Report
File Size:	995 kb
File Type:	pdf

FDIC Publishes Guidance on NSF Fees

9/30/2022

By J. Marc Ward - Fredrikson & Byron, P.A

If you charge a fee for non-sufficient funds (NSF) you should be aware of a recent guidance from the FDIC. This is doubly true if you charge multiple NSF fees for re-presentment of an item. And it becomes critical if you rapidly charge these fees without giving your customer sufficient time to cover the amount due.

FDIC guidance does not lay down hard and fast rules regarding NSF policies and practices. It does not define how much time a customer should have between re-presentments but only that it cannot be a “short period of time.”

The biggest challenge for banks that rely on core processors to assess NSF fees will be core processor cooperation. While the FDIC encourages banks to work with these third parties to reduce the risk of unfair or deceptive practices with regard to NSF fees, it has been our experience that data processors are not very cooperative in correcting these practices.

LOT Members hold Fall meeting at Kinnick Stadium

9/23/2022

CBI's Leaders of Tomorrow (LOT) group members held their Fall Business Meeting at Kinnick Stadium in Iowa City. Guest speaker Alicia Nicoletto from Nyemaster Law updated LOT members on changes to the Uniform Commercial Code, non-fungible tokens (NFTs), cryptocurrency and other issues in digital asset management.

Scott Brickman, EVO/COO of the Swarm Collective NIL presented on that organization's mission and developments in "Name, Image, Likeness" contracts, on the rise after recent NCAA regulation changes regarding college sport player compensations. Brickman explained that an important part of the Collective's purpose is to assist players in the process, and that verifiable, ongoing community service and outreach is required as part of a player's agreement with the Collective.

Community Bank Index (QCBI) State Performance Trends: 2022Q2

8/15/2022

compiled by CBI Endorsed Member QwickRate

STATE OF THE STATE: IA 2nd Quarter 2022
Key industry trends for the "true" community bank.

Click each image to view larger, or download the entire report (PDF, 1MB)

Download Full Report.
File Size:	997 kb
File Type:	pdf

Storey Kenworthy & Workspace still accepting grant applications through Aug. 31

8/15/2022

CBI Endorsed Member Storey Kenworthy & Workspace Foundation for Giving is accepting grant applications from qualified non-profit organizations until Aug. 31, 2022.

Five $5,000 grants will be awarded to selected non-profits whose programming aligns with the core giving priorities:

Abuse & Violence Prevention
Children & Education
Diversity, Equity & Inclusion
Mental Health Awareness & Services

Additional information about the Storey Kenworthy & Workspace Giving Programs and a grant application is available at www.storeykenworthy.com/community.

The Storey Kenworthy & Workspace family of companies, with 10 locations across Iowa, is a family-owned, independent office supplies and commercial interiors dealership.