CBAO needs your comments for upcoming OCC Meeting!

CBAO has been invited to attend an OCC Central District Meeting, with District Deputy Comptroller Bert Otto; Senior Deputy Comptroller, Jennifer Kelly, Ombudsman Larry Hattix and other senior officials, in Chicago, IL on Thursday, April 4, 2013.


The meeting will cover the OCC/OTS integration, the appeals process, lessons learned from bank failures, legal update on pending regulatory matters, Dodd-Frank, examination process, and other supervisory and regulatory items of interest. CBAO has requested that those in attendance also discuss the following.


- Strategic Risk

- Credit Risk

- Credit Risk Management Systems

- Trends in CAMELS Ratings

- Increase focus on Information Technology Ratings

- Improved Problem Bank Trends

- Compliance

- Accounting

- Investment Grade Standards

- Credit Concentrations


We ask that you please let us know if you have other areas that you would like to have discussed or you can offer any comments that would strengthen the value of our conversation.

Mark your Calendar: TAG Alternative Strategies : Exclusive Event for Ohio Community Banks Wed Feb. 6, 10 AM

The Community Bankers Association of Ohio (CBAO) is hosting a special webcast on at 10:00 AM Wednesday, February, 6th , to discuss the current state of community banking and address the potential opportunities and solutions available for banks in a post TAG environment. Special guest, StoneCastle Partners, one of the largest investors in community banks, will provide an update on the current state of banking with an outlook on key issues facing community bankers in 2013.

Watch your CBAO newsletter or contact Kyle Moseman for additional information.

Factoring: What is it and how can it help banks and their customers?

Factoring the sale of invoices is one of the oldest forms of “lending”, dating back until at least the time of the Romans. It’s also one of the simplest and straight forward ways of converting assets to cash, yet it is often misunderstood.

Terms like “hold back,” “reserves,” “advance rate,” and “points” can put people on edge. Add to the fact that just about everyone tries to compare “factoring vs. bank loans” and it is no wonder many people leave the table confused. We all like to begin discussions about financing with terms, but discussing factoring costs in the same way we discuss loan terms is not the best way to help a customer understand factoring.

 Factoring is not a loan! It is a sale of assets. Therefore the customer is not incurring debt (or paying interest on that debt). The customer also has the flexibility to sell as many (or as few) invoices as they want. They are free to spend the money however they see fit, rather than in a manner approved as a part of a loan application.

Because the invoices are the source of repayment to the factor, they are evaluated more carefully that the client’s financials. Many companies that would not be able to obtain a loan can factor to raise cash, and do so quickly! Factoring could also be used in a “work-out” situation for an existing customer.

Why over-complicate the issue? If as banker we are asked to help a customer get cash, let examine the possibilities and let the customer decide what will work for them. Sale of invoices, which is all that factoring is, might be just the solution. It is routine in some industries: transportation, temp agencies, construction contracting, and others where there is a typical long lead time between incurring expense and receiving payment.

Other variables come in to play – especially when it comes to due diligence, but the factor will handle that. CBAO has identified numerous sources for factoring, some of which specialize in certain industries. If you have a customer who might benefit, let’s begin a discussion!

Senate Blocks TAG Extension Bill – Seeking TAG Alternatives?

The Senate recently blocked the Dodd-Frank Transaction Account Guarantee Program (‘TAG’) Bill.  TAG was designed to temporarily insure large commercial and institutional transaction accounts that have more money than is covered by typical deposit insurance, $250,000 per account.

As a result of TAG’s expiration, many banks are seeking solutions that will allow them to continue offering full FDIC insurance coverage and retain those customer relationships.   StoneCastle, a leading investor and advocate for community banks and a CBAO Partner is available to offer immediate support to those banks impacted by expiration of TAG.  StoneCastle Cash Management offers the Federally Insured Cash Account for those depositors which require FDIC insurance on large balances.  Click here if you would like to learn more. 

Governor Kasich Signs Financial Institutions Tax Bill!

Today Governor Kasich signed into law the Financial Institutions Tax Bill (aka HB 510 & FIT). The bill, which replaces the Dealers in Intangibles and Corporate Franchise Tax, benefits our industry in many ways.

First it brings an immediate bottom line impact to Ohio’s 220 community banks that is estimated at $30 million annually. This will allow for increased capital for community banks to meet regulatory requirements and increase lending to small businesses and consumers.

Secondly it brings some fairness to Ohio’s Tax System for community banks by “balancing” the liability and removing loopholes that many larger financial institutions have taken advantage of.

During the signing Governor Kasich reiterated the value of community banks to their local economies and how they are the economic engine that will continue to move Ohio forward.

CBAO was engaged in this legislation from its introduction and recognizes the efforts of all who made today a reality, especially Chairman of the House Ways and Means Committee Ron Amstutz, (R-Wooster) and Chairman Tim Schaffer, (R-Lancaster) of the Senate Ways and Means and Economic Development Committee.

 

 

HOUSE BILL 510 PASSES OHIO SENATE

On Wednesday, December 5, House Bill 510, known as the Financial Institutions Tax Bill, passed the Ohio Senate with bi-partisan support by a vote of 25-8. During his floor speech, Senator Schaffer thanked the Community Bankers Association of Ohio for their work on the bill. It is expected that the Ohio House of Representatives will concur with the Senate amendments on Tuesday, December 11, 2012.

HB 510 Passes Senate Committee - Saving Ohio's 221 Community Banks $30M Annually

The Ohio Senate Ways and Means and Economic Development Committee passed HB 510 which will change the way Ohio's community banks are taxed. CBAO has been working closely with the General Assembly during the past year to get the bill enacted. The bill will bring fairness and equity to the way Ohio's financial institutions are taxed. It is expected the bill will be sent to the Ohio Senate for consideration on Wednesday, December 5, 2012.

CBAO would like to thank community bankers, Scott McComb and Jack Hartings for providing proponent testimony to the committee. We would also like to thank the many community bankers from around the state who attended committee meetings and contacted their Senators in support of HB 510.