Engaging Our State in the Bank On Nebraska Challenge

During the NBA’s recently completed strategic planning process, one issue that came to the forefront during almost every focus group, planning discussion, and personal interview was the need to more proactively market Nebraska’s banking industry and the positive impact Nebraska banks have on Nebraska communities, families, and individuals. It also became evident that addressing this task was going to require some nontraditional strategies, especially in reaching out and connecting with the “NExt Generation” of Nebraskans.

With the approval and support of the NBA Board of Directors, your association will publicly launch the Bank On Nebraska Challenge for Nebraska’s high school students on January 15, 2018. This statewide competition will challenge today’s young people to submit short videos recognizing and highlighting the important role Nebraska banks play in their communities, schools, and families. Students will be encouraged to upload their videos between February 19 and March 25.

BankOnNE Site Image

Members of the NBA’s Young Bankers of Nebraska Committee will be tasked with reviewing and scoring the videos. The finalists’ videos will be announced on April 6. Subsequently, the public will be asked to vote for their favorite video online through a customized website, much like they might vote for the winners on American Idol. Students selected as finalists, along with their parent/guardian and teacher, will be invited to the 2018 NBA Annual Convention on Friday, May 4, at which time the winning video will be announced.

To encourage student participation, contest finalists will be awarded a $529 scholarship as well as a MacBook. In addition, the home school of the contest finalists will be provided $529 in unrestricted funds to be used at the direction of the participating teacher for supplies or other classroom needs. The producer of the winning video, as selected by the voting public, will receive an additional $2,000 scholarship. Finally, there will also be a special $1,000 prize for the funniest video, as selected by the YBON Committee members, and 10 randomly selected $100 Visa gift card prizes.

This video contest, as you might be thinking, is clearly outside of the box for the association and our member institutions; however, we know that today’s young people view life through a vastly different prism. The targeted students grew up during the Great Recession, when banks of all sizes were portrayed in a negative light by media sources at every turn. These students also are accustomed to relying on online platforms for their news, information, and entertainment. To help us reach this market and facilitate such a unique process, the NBA has engaged Red Thread, a Lincoln, Neb.-based, marketing firm that specializes in multimedia and fostering connections with today’s teenagers. In addition to coordinating the video contest, NBA staff has also asked this marketing firm to develop some additional materials to showcase the many career opportunities available in the banking field.

To be successful in this effort, the NBA needs help from every member institution. Specifically, we ask that you:

  • Make a personal phone call or send an email to your high school superintendent/principal to promote the video contest. Material will be sent to you in early January.
  • Reach out to the business teachers at area high schools and encourage them to recruit student participants. One NBA Board member suggested that local schools should give extra credit for participation!
  • Openly discuss the video contest at an upcoming service club or chamber of commerce meeting.
  • Proactively discuss the video contest with your bank staff so they can actively discuss and encourage student participation. A few member institutions will be offering local prizes to area students that participate.
  • Include information about the video contest in marketing and promotional pieces that your institution provides to customers (and their children).
  • Actively use your bank’s social media channels to promote the Bank On Nebraska Challenge, the contest website at www.BankOnNE.com, and the Twitter hashtag #BankOnNE.
  • If a student features your bank in one of their videos, feel free to highlight the video on your bank’s website and marketing materials.
  • Obtain a contest poster at an upcoming NBA educational program and display it in your bank.
  • When the finalists are announced in April, encourage your staff, customers, and community members to vote for their favorite video. It would be exciting to see banks and communities support the student finalists with organized voting efforts.
  • Attend the NBA Annual Convention to show your support for the students.

Specific details about this contest as well as contest rules can be found at: www.BankOnNE.com. Should you have any questions about this statewide marketing initiative, please feel free to reach out to me at (402) 474-1555 or richard.baier@nebankers.org.

Email NBA President & CEO Richard J. Baier at richard.baier@nebankers.org.

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CFPB Meeting Demonstrates Need for Real-World Education

In late July, I was part of a small group of state bankers association representatives asked to participate in a meeting at the Consumer Financial Protection Bureau (CFPB) related to the Dodd-Frank Act’s pending Section 1071 Small Business Data Collection requirements. Meeting participants included association representatives from Georgia, Massachusetts, Missouri, Nebraska, New Hampshire, and Oklahoma as well as from the ABA. We were joined at the CFPB’s headquarters by 16 CFPB representatives who are responsible for implementing these regulations.

You will find the NBA’s formal comments to the CFPB’s Request for Information Regarding the Small Business Lending Market (Docket No. CFPB-2017-0011) at http://bit.ly/S1071Ltr. Below are a few personal observations about our meeting and subsequent discussions.

  • The meeting included an active give-and-take dialogue, with many CFPB staff asking good questions and trying to understand how their proposed rules might impact both banks and borrowers. I witnessed several key staff diligently taking notes during the discussions. They seemed eager to learn about our perspective.
  • Like many federal agency and congressional offices in Washington, D.C., the CFPB is largely staffed by young people who are extremely bright but lack a certain level of real-world business experience and understanding. Although Grady Hedgespeth, the individual leading the project to implement Section 1071, has banking and government (SBA) experience, only a small number of meeting participants had any true banking knowledge, or had ever made a loan. One staff member told me after the meeting that his primary banking knowledge was the result of obtaining a car loan at a credit union and using his debit card.
  • It is challenging for agency representatives to develop simple regulations and programs that meet both congressional intent and statutory language. Several of the CFPB staff expressed their concerns about and commitment to complying with the federal statutes as handed down by Congress.
  • Certain CFPB staff members lacked a thorough understanding of the complexities of our banking system, especially as it relates to commercial lending. Several staff, for example, suggested that every bank in the country has a standardized, one-page application for small business lending. Similarly, many were surprised that discretion in the small business lending space is driven by an enormous amount of business factors, not just a cookie-cutter template. I mentioned the impact, for example, that products like USDA or SBA guarantees can have on the terms of a commercial note.
  • Because of their personal experiences (or lack thereof), many of the young CFPB staff have a difficult time grasping the challenges of rural areas and small banks. I shared with them that Nebraska has 80 banks with less than $100 million in assets. In addition, some of our smallest NBA-member institutions have less than five employees. Therefore, the statutory requirement that loan underwriting be completed by someone other than the participating loan officer will be especially troublesome for smaller institutions. Likewise, the shear geographic area of a state like Nebraska was difficult to comprehend for individuals who may easily drive through two or three states daily on their way to work.
  • A recurring, yet highly inaccurate perception of the CFPB staff was that banks can easily and efficiently adjust their operating plans and software systems to account for these new requirements. Obviously, those of us involved in the banking sector know differently.
  • Finally, as we have witnessed since the Great Recession, some misplaced reservations about the banking sector and our motivations for doing business remain. I am not sure CFPB staff had an appreciation of the fact that we want our customers/borrowers to be successful.

After returning to Nebraska, I spent a great deal of time mulling over the meeting and considering how our industry can proactively address the inherent challenges and assumptions held by some within the bank regulatory community.

First and foremost, we must remain vigilant on the legislative front. As we have learned all too well as a result of Dodd-Frank, regulations designed for larger, more complex financial institutions always seem to flow downhill, impacting every institution in America, regardless of their business model. Secondly, we need to find ways to help better educate young staffers who are starting their careers in Congress or within the regulatory agencies. We routinely host a “Take Your Lawmaker to Work” week, but how often do we spend time educating our young regulators? We must find ways to help them better understand the complexities of our core systems, why a combine costs $300,000 plus, why a bank may not loan the requested amount to a commercial borrower and how this may actually be better for the borrower’s business, how a bank can successfully operate with four staff members, or that our rural branch locations can operate efficiently even though they are 200 miles apart.

Finally, the banking industry must seek new opportunities to actively educate and engage the next generation about our industry. We need to think about our industry’s marketing efforts and find new communication strategies that will resonate with Generations X, Y, and Z. Banks are not only the credit engine of our economy, but also a fundamental component of every life-changing event we experience—from purchasing our first car or home and saving for college to financing a new business and ensuring our dollars are safe from hackers and crackers. Our next generation—whether they are working as a manufacturer in David City, a rancher in Mullen, or a bank regulator in Washington, D.C.—must understand that Nebraska banks are their partners in success and that they can “Bank On Nebraska” financial institutions for financing their future.

Email NBA President & CEO Richard J. Baier at richard.baier@nebankers.org.

Seven Tips for Avoiding Online Fraud

The weather turns colder and the days grow shorter during this spooky time of year, but it’s not the ghosts and ghouls you should fear. The real danger arises from the hackers, crackers, and cyber punks who want to get past your firewall and gain access to your personal information. That’s why the Nebraska Bankers Association (NBA) is promoting National Cybersecurity Awareness Month this October.

Cyber attacks are becoming more complex and common. According to the FBI’s Internet Crime Complaint Center, in 2016, cyber victims lost $1.3 billion from scams initiated through the web.

CyberAware_DataBreach

The world wide web doesn’t have to be scary. Just follow these tips to help keep your information safe online:

  • Keep your computers and mobile devices up-to-date. Having the latest security software, web browser, and operating system is the best defense against viruses, malware, and other online threats. Turn on automatic updates so you receive the newest fixes as they become available.
  • Create complic@t3d passwords. A strong password is at least eight characters in length and includes a mix of upper and lowercase letters, numbers, and special characters. Follow these guidelines when creating new passwords for better protection.
  • Watch out for phishing scams. Phishing scams use fraudulent emails and websites to trick users into disclosing private account or login information. Do not click on links or open any attachments or pop-up screens from sources you are not familiar with. Forward phishing emails to the Federal Trade Commission (FTC) at spam@uce.gov – as well as to the company, bank, or organization impersonated in the email.
  • Keep personal information personal. Hackers can use social media profiles to figure out your passwords and answer those security questions in password reset tools. Lock down your privacy settings and avoid posting things like birthdays, addresses, your mother’s maiden name, etc. Be wary of requests to connect from people you do not know.
  • Secure your internet connection. Always protect your home wireless network with a password. When connecting to public wi-fi networks, be cautious about what information you are sending over it.
  • Shop safely. Before shopping online, make sure the website uses secure technology. When you are at the checkout screen, verify that the web address begins with https. Also, check to see if a tiny locked padlock symbol appears on the page.
  • Read the site’s privacy policies. Though long and complex, privacy policies tell you how the site protects the personal information it collects. If you don’t see or understand a site’s privacy policy, consider doing business elsewhere.

More information on Cybersecurity Awareness Month and additional tips on monitoring your personal information on the web are available from Stay Safe Online at https://staysafeonline.org/stay-safe-online/. Limit your fears to ghosts this Halloween and stay protected on the web.

Email NBA President & CEO Richard J. Baier at richard.baier@nebankers.org.

NBA Strategic Plan Now Underway

While traveling across Interstate 80 recently, I spent some time reflecting upon the very first, boxy cell phone I owned in roughly 1994. This heavy device offered questionable quality and service, but it was very cool. Clearly, times and technology have changed! Today, our lives are driven by smart phones and new technologies—email, text messaging, calendars, contacts, internet searches, directions, movies, entertainment, etc. No one industry has been impacted more dramatically by changes in technology and resulting consumer preferences than banking and financial services. These rapid technological advances were one factor that led your NBA Board of Directors to embark upon a strategic planning process in late 2016.

At the July meeting, the NBA Board accepted the final strategic planning document and recommendations from Financial Shares Corp. (FSC). The plan was developed following a variety of member surveys; board retreats; member, nonmember, and staff interviews; and a thorough data review.

The plan outlined four primary strategic goals. Within these goals, the plan identified 55-plus strategic action steps. The board and staff analyzed these specific implementation steps and settled on a list of eight to 12 priorities for the coming year. A complete copy of the plan can be found on the NBA website at http://bit.ly/NBAStrategicPlan. Following is listing of the four primary goals along with a sampling of action steps within each category.

Goal #1:  Increase Organizational Efficiency

a. Consolidate accounting functions between the NBA and NBISCO 2017-2018
b. Conduct a thorough financial review of all NBISCO and NBA educational offerings 2017-2018
c. Finalize VEBA online enrollment 2018
d. Evaluate offering NBA/NBISCO/VEBA programs to associate members and preferred vendors 2017-2018
e. Solicit outside experts to review and offer strategies for VEBA to better navigate the changing healthcare marketplace 2017-2018

Goal #2:  Enhance Organizational Effectiveness

a. Develop a formal social media strategy 2017-2018
b. Engage next generation (young) bankers in making school presentations and hosting peer group meetings 2018
c. Craft formal succession plans for key NBA staff and the lobbying team 2017-2018
d. Extend the length of NBA Board member terms 2018
e. Conduct a member dues review to assure consistency in the marketplace 2018-2019

Goal #3:  Improve Advocacy & Industry Promotion

a. Initiate a candidate school for Nebraskans seeking local and state elected office 2018-2019
b. Host a Young Bankers of Nebraska (YBON) day at the Nebraska Capitol 2018
c. Develop targeted marketing/promotional efforts to showcase the importance of Nebraska banks and careers in banking 2017-2019
d. Lead a statewide discussion/strategy about improving financial literacy 2018-2019
e. Increase effectiveness of banking internship programs at all banks and extend internship matchmaking to all higher education institutions 2018-2019

Goal #4:  Pursue Growth in a Disciplined Manner

a. Conduct research/survey member institutions about specific business needs to support new preferred vendors and services 2017-2019
b. Meet with large-member institutions to discuss collaboration on education and training opportunities 2017-2018
c. Continually evaluate products and services that assist members with the talent recruitment and development process 2017-2019
d. Help growing member institutions meet CRA-related requirements (i.e., SBIC, financial literacy) 2018-2019
e. Identify specific product offerings to expand to partnerships with other state bankers associations 2019

While this list is not a comprehensive recount of the specific tactics outlined by FSC, it offers you a flavor of the functions that the board, staff, and various volunteers will focus their time and talents in the coming years. In cooperation with staff members, we have already initiated plans to address the more short-term strategies contained in the plan.

The goal in undertaking this planning process was to assure a sustainable and successful trade association that meets the needs of our extraordinary member banks and also helps to grow the banking industry in Nebraska. If you have questions about the strategic plan or wish to discuss the implementation strategy, please feel free to reach out to me directly.

Email Richard Baier at richard.baier@nebankers.org.

A Solid Finish to a Strong Year

Thank you to those of you who attended the recent 2017 NBA Annual Convention held at the La Vista Conference Center. This year’s convention included outstanding speakers, special recognition of our many volunteer banks and bankers, time for both personal and professional networking, as well as an annual update on the activities and financial position of your NBA.

2017 NBA Convention Theme

Debra Jasper, Ph.D., founder and CEO of Mindset Digital, delivered our keynote presentation highlighting important strategies necessary to lead in today’s social media driven world. Other presenters discussed the role of the media in our turbulent political world, strategies for making dreams come true, and lessons on surviving in difficult situations. Dr. Nathan Kauffman, assistant vice president and Omaha branch executive of the Federal Reserve Bank of Kansas City, discussed the current agricultural marketplace and his thoughts about the coming farm season. George Morvis, founder and CEO of Hinsdale, Ill.-based Financial Shares Corp., provided attendees with an update on the NBA’s strategic planning initiative (more to follow next month).

One of my primary responsibilities during the convention is to offer an annual organizational overview of the NBA and to review the association’s financial position. Following are a few of the highlights. The full NBA Annual Report can be found at http://bit.ly/NBAAnnualReport16-17.

  • From year-end 2010 to 2016, the number of bank and savings institution charters in Nebraska decreased from 224 to 182, an 18.76 percent decrease.
  • Total bank employment in Nebraska on Dec. 31, 2016, was 15,075, a substantial increase from 13,102 employees in 2010.
  • Total NBA membership is 187 commercial banks and savings institutions. The largest concentration in membership is those institutions having between $101 million and $500 million in deposits (80 banks, 43 percent of the total).
  • Recent legislative successes included passage of LB 140, which represents a yearlong effort to modernize the state’s banking code. Included within this adopted legislation are provisions to allow state-chartered banks to opt out of the executive officer’s license requirement.
  • The NBA NExt Generation Housing Task Force has facilitated a dialogue across the state about the importance of building new workforce housing in our rural communities. Several key pieces of state legislation were crafted and adopted to support this important mission.
  • Last year, the NBA hosted 43 in-person education and training programs, representing 4,245 registrants.
  • The NBA, through various efforts, contributed approximately $175,000 in scholarships and support for our state’s higher education institutions.
  • During the past year, NBA bankers touched 27,926 Nebraskans through their financial literacy education training efforts.
  • NBA leadership participated in 45 state and local media interviews.
  • The NBA’s Voluntary Employees Beneficiary Association (VEBA) provides reasonably priced, predictable health care coverage to 4,500-plus bankers, representing more than 10,900 covered lives.
  • Thanks to continued strong member financial support and product utilization, along with a focus on reasonable cost control, both the NBA and NBISCO finished the recently completed fiscal year on very solid footing. Following is a brief look at the combined estimated year-end numbers:

EndYear_Chart

Finally, thanks to the many bank employees/volunteers who were recognized for their achievements during the NBA Annual Convention. Your efforts in supporting BankPAC, financial literacy, and NBA committee work are essential to strengthening our communities and the banking sector throughout our state.

Richard J. Baier is president and CEO of the Nebraska Bankers Association (NBA). Founded in 1890, the NBA is the voice of Nebraska’s $76 billion banking industry, which is composed of small, regional, and large banks that together employ more than 15,000 people, safeguard almost $59 billion in deposits, and extend more than $57 billion in loans, all within the state of Nebraska. For more information, contact Baier at (402) 474-1555 or richard.baier@nebankers.org.

NBA Leaders Serve Nebraska

As I contemplated my thoughts for this month’s blog post, I suddenly found myself choosing between several relevant topics. Rather than choose, I decided to address a couple of them in short fashion, so please excuse my ramblings.

Three Banker-Legislators

I would like to begin by giving a special thanks to Sens. John Stinner, Matt Williams, and Rob Clements for their willingness to set aside their personal lives and businesses to serve the citizens of Nebraska.

Senators

Sens. Stinner and Williams are beginning their third year in the Legislature while Sen. Clements was recently appointed by Gov. Pete Ricketts to fill an unexpired term. Sens. Stinner and Williams are both past chairmen of the Nebraska Bankers Association, while Sen. Clements previously served on the NBA Government Relations Committee and Voluntary Employees Beneficiary Association (VEBA) Board of Trustees. Not a week goes by that your NBA team does not receive unsolicited positive comments from other organizations, senators, and statewide elected officials about how fortunate the banking sector is to have such distinguished public servants offering common sense leadership on the many complicated state policy topics.

Sen. Stinner currently chairs the Appropriations Committee. His experience and background in banking and accounting are invaluable as this committee develops strategies for confronting the state’s $900 million shortfall. Sen. Williams serves as vice chairman of the Banking, Commerce, and Insurance Committee, in addition to the Health & Human Services and Planning Committees. Both Sens. Stinner and Williams are sponsoring affirmative legislation on behalf of the NBA during the current legislative session addressing various policy issues such as banking regulation, executive officer licensing, and workforce housing. Sen. Clements sits on the Appropriations Committee and is quickly using his banking and actuarial skills to help sort through the many demands placed on the state’s budget.

These gentlemen, by virtue of their positions in the Legislature, also serve as confidants and personal advisers for your NBA lobbying team. Again, special thanks to these individuals for offering their talents and leadership skills to make a difference for the state of Nebraska.

Arrigo Celebrates 30 Years

The success of every business is defined by the quality, skills, initiative, and creativity of the employees who work and represent the business. Your association is no exception! This month, the NBA pays special tribute to one of our key long-term employees, Ron Arrigo, who is celebrating 30 years of service to the NBA and Nebraska’s banking industry. Ron currently serves as NBA senior vice president, with responsibilities for member education and internal operations. In the three years I have worked with him, I have found Ron to be a consummate professional who understands the challenges and opportunities faced by our member institutions. He also is creative and willing to grow and evolve to meet new challenges in today’s ever-evolving world. Please help me in congratulating Ron on reaching this important milestone in his career.

Strategic Planning Update

As you probably know, in early 2016, the NBA Board of Directors contracted with Financial Shares Corp. (FSC) of Hinsdale, Ill., to help facilitate an NBA strategic planning process. To garner member and industry input, FSC has completed personal meetings with NBA leadership and key staff; conducted member surveys; led group planning sessions with the NBA, NBISCO, and VEBA Boards, NBA Past Chairmen, select Leadership Program alumni, Young Bankers of Nebraska representatives, and NBA staff; and also completed numerous member and non-member interviews. The draft plan was presented to the NBA Board of Directors on March 23 for initial response and input. The final plan will be presented to the NBA membership at the NBA Annual Convention on May 4. Be on the lookout for how the NBA will grow and evolve to help meet the needs of Nebraska’s banking industry into the foreseeable future.

Email Richard Baier at richard.baier@nebankers.org.

Seven Tips to Prevent Tax ID Fraud: NBA Raises Awareness for Tax Identity Theft Awareness Week

In recognition of Tax Identity Theft Awareness Week, Jan. 30-Feb. 3, the Nebraska Bankers Association is urging all Nebraskans to take extra precaution when filing their tax return to prevent their exposure to tax fraud.

Fraudsters are using very clever tactics to get a hold of your personal information and submit false tax claims. Consumers must be suspicious of any communication from the IRS ¾ through email or text, or social media ¾ that requests personal information, and should keep a watchful eye out for missing W-2s and mail containing sensitive financial information.

Tax identity fraud takes place when a criminal files a false tax return using a stolen Social Security number in order to fraudulently claim the refund. Identity thieves generally file false claims early in the year; victims are unaware until they file a return and learn one has already been filed in their name.

To help Nebraskans prevent tax ID fraud, the Nebraska Bankers Association (NBA) is offering the following tips:

  • File early. File your tax return as soon as you’re able giving criminals less time to use your information to file a false return.
  • File on a protected Wi-Fi network. If you’re using an online service to file your return, be sure you’re connected to a password-protected personal network. Avoid using public networks like a Wi-Fi hotspot at a coffee shop.
  • Use a secure mailbox. If you’re filing by mail, drop your tax return at the post office or an official postal box instead of your mailbox at home. Some criminals look for completed tax return forms in home mailboxes during tax season.
  • Find a tax preparer you trust. If you’re planning to hire someone to do your taxes, get recommendations and research a tax preparer thoroughly before handing over all of your financial information.
  • Shred what you don’t need. Once you’ve completed your tax return, shred the sensitive documents you no longer need and safely file away the ones you do.
  • Beware of phishing scams by email, text, or phone. Scammers may try to solicit sensitive information by impersonating the IRS. Know that the IRS will not contact you by email, text, or social media. If the IRS needs information, they will contact you by mail first.
  • Keep an eye out for missing mail. Fraudsters look for W-2s, tax refunds, or other mail containing your financial information. If you don’t receive your W-2s, and your employer indicates they’ve been mailed, or it looks like it has been previously opened upon delivery, contact the IRS immediately.

If you believe you’re a victim of tax identity theft or if the IRS denies your tax return because one has previously been filed under your name, alert the IRS Identity Protection Specialized Unit at 1-800-908-4490. In addition, you should:

  • Respond immediately to any IRS notice and complete IRS Form 14039, Identity Theft Affidavit.
  • Contact your bank immediately, and close any accounts opened without your permission or that have been tampered with.
  • Contact the three major credit bureaus to place a fraud alert on your credit records:
  • Continue to pay your taxes and file your tax return, even if you must do so by paper.

More information about tax identity theft is available from the Federal Trade Commission at ftc.gov/taxidtheft and the IRS at irs.gov/identitytheft.

Email Richard Baier at richard.baier@nebankers.org.