Ohio Bankers League Spring 2010 Magazine

Ohio Record spring 20102

spring 2010 Ohio Record 3

A Comprehensive Resource for the Ohio Banking Industry

spring2010 issue

Other News

4 Chairman’s Corner6 Random Thoughts

18 Steps of the Statehouse

24 Excellence through Education

45 Around the Industry

Features

8 Ohio Bankers a Big Part of Grassroots Initiatives on Reg Restructuring Proposal D.C. Fly-in in Pictures

10 Partners in Each Others Futures First OBL Economic Summit in Pictures

12 The Bank M&A MarketWhere Have All the Deals Gone?

14 Are your Compensation and Executive Benefit Programs Ready for 2010?A Profitable CRA Investment

20 Senior Housing Crime Prevention Foundation to Aid Elderly Veterans

22 Taking the Pain Out of Loan ParticipationsOBL Launches New Online Marketplace

28 The Ohio Bankers Benefits TrustThe Health Plan Designed by Bankers for Banks

31 The Road Ahead Changes in Labor and Employment Law for 2010

35 Walk the Walk

39 Ohio BankPac – Making a Difference

Contents

Ohio Recordspring 2010 issue

4249 Easton Way, Suite 150Columbus, Ohio 43219-6170Tel. (614) 340-7595Fax (614) 340-7596Toll Free 800-686-6755

James Thurston, EditorSusan Poling, Features

Association Staff

Michael AdelmanVice President of State Government [email protected]

Brenda Arnold, Administrative AssistantOBL [email protected]

Mike Baker, VP & Executive Director,OBL [email protected]

Dan Conklin, BankPac/GovernmentRelations [email protected]

Michelle Crume, Vice President & Regional DirectorOBL/Infinex [email protected]

Pam Foster, Compliance [email protected]

Carol Halkias, [email protected]

Wendy Hench, AdministratorOhio Bankers Benefits [email protected]

Julie Kiplinger, Manager of Professional Seminars & In-Bank [email protected]

Sue Leppert, Administrative [email protected]

Lynn Moore, Accounting Coordinator, OBL BankServicesCompliance Coordinator, OBL Compliance [email protected]

Susan Poling, Communications [email protected]

Jeff Quayle, SVP & General [email protected]

Stacy Schindler, Manager, Professional [email protected]

Bill Showalter, OBL Compliance [email protected]

Gary Sutter, Employee Benefits Manager,OBL [email protected]

James Thurston, Communications [email protected]

Sue Turner, Executive [email protected]

Mike Van Buskirk, President & [email protected]

Melea Wachtman, Senior Vice Presidentof [email protected]

The Ohio Record is published quarterly byOBL BankServices. Member subscriptionsmay be purchased for $25 per year; Non-membersubscriptions may be purchased for $50 per year.POSTMASTER: Send address changes toOhio Record at the address listed above.


OBL members Howard Boyle and Randy Herron testified against a bill thatwould permit Ohio credit unions to hold public deposits at the Statehouse recently.If credit unions gain the authority to accept public deposits they in turn shouldbecome subject to the same taxation and regulation as other financial institutions,the bankers told the told the House Financial Institutions, Real Estate andSecurities Committee.

Boyle, president & CEO of Home Savings Bank, Kent, (pictured, right, withthe OBL’s Mike Adelman and Herron, center) testified, “This bill is about choice.It is about choosing whether the tax-preferred credit unions should be permitted tobecome more bank-like with or without the same taxation and regulatory obligations.”

Herron, president & CEO of Mutual Federal Savings Bank in Sidney, asked,“The tax subsidization enjoyed byOhio’s credit union industry is greaterthan $20 million per year annually.That is to say that Ohio is alreadydepositing over $20 million per year in the credit unions. How much moredo they need?” The bill is sponsored by Reps. Tracy Maxwell Heard (D-Columbus) and Peter Ujvagi (D-Toledo).

BANKERS SPEAK OUT AGAINST CREDIT UNION BILL AT STATEHOUSE

Last month, several of us on the OBLstaff headed to Washington D.C. along witha small army of more than 30 Ohio bankersto try to help the Ohio Congressional delegation, and bank agency heads, gaininsights to lead to regulatory modernizationthat might actually work. The stakes are veryhigh for the industry, which is why thosebankers found time to go to Washingtonand why I will fly back there again andagain during the coming weeks. The recenthistory of Congressional action may not beencouraging but dropping out of the fightwould make real disaster a certainty.

Much has been written about the causes of our current recession - some of itthoughtful, much not. Those of you whohave read this column in the past willunderstand why our communications staffdoesn’t think I understand the term“brief.” My intent, therefore, is to keep myfocus today narrow. Hopefully, you will beable to judge the thoughtfulness, or lackthereof, relatively soon.

By 1787 our founding fathers had con-cluded that the Confederation formed fol-lowing the American Revolution was fatallyflawed. They convened a constitutionalconvention in Philadelphia. Its proceed-ings were secret. What we now know ofthem come from private notes made byJames Madison that were published fouryears after his death. Madison had broughtwith him to Philadelphia two carefullyresearched background pieces on theshortcomings of the Confederation. Onewas titled, “Vices of the Political System ofthe United States” which might essentiallybe the theme for this column.

We know the framers consciouslydesigned checks and balances. Theysketched out a House of Representatives,whose members would be popularly elected,giving larger states greater power. Theydesigned a Senate, whose members initiallywere elected by state legislatures, withstates equally represented giving the morenumerous, smaller states more power.

Most power remained on state turf.Congress’s focus was limited, allowingcareful deliberation. While some elementsof the Articles of Confederation remained,most were new, and that which was not wascarefully modified to fit the new model.

Clearly, the world was much differentthen. While the size of both the House ofRepresentatives and Senate has grownover the years, and Senators are now pop-ularly elected, the framers’ environment

informed the design of what still governsus more than two centuries later. That itworks at all is a testimony to the genius ofthe framers. However, my theme in thisedition is that, in critically important ways,our legislative process is broken.

Essentially we expect that those whorepresent us in Congress, supported by relatively small staffs, will be experts oneverything in the universe. Our world isinfinitely more complex that in 1787.Those whose lives Congress touches col-lectively provide a Niagara Falls of infor-mation and opinion. Members of Congressand their staffs don’t have time to separatetruth from artifice.

In the House, most Representativesserve on two committees, one major, oneminor. When they have an idea, almost allstemming from incomplete knowledge,they are motivated by House rules to writea bill so it will be referred to a committeethey serve on. Essentially, they’ll butchertheir proposed remedy to fit a committeewhere their influence will be greatest.Committees have limited jurisdiction sothey must write their solution so its imple-menting rules will be written by an agencyunder their committee. If some agency, notunder the jurisdiction of the committee, is

contributing to the problem only rarelywill the bill address that agency. Thatwould require a “sequential referral,”almost always a kiss of death for any bill.So the result is layer upon layer of overlap-ping, often inconsistent, often conflictingrule and regulation.

Each of us votes to elect aRepresentative to Congress from our dis-trict and two Senators from our state. Theshear volume of issues that overwhelmsthose we elect to Congress also keeps weindividual voters from learning muchabout what they really do. Instead mostvotes are based on slick election commer-cials, news releases about federal programsthey’ve won (often earmarks) that can’t bejustified as a national priority and whichcollectively drive mind boggling federaldeficits. Now you know why you arerequired prepare 40 to 100 pages to giveconsumers at a mortgage closing, disclo-sures that because of their shear volume,few are willing to read?

Most members of Congress are hard-working and bright; but the system breedsselfish interest. Consider the “bribes” paidto assemble the majority vote in theSenate on a health insurance bill giving citizens of a few states material advantageover others. Few Americans, includingmost of those who work in Congress, haveread either the of the massive House andSenate health insurance bills. We individ-ually face much the same problem asCongress. We have challenges in our ownpersonal and business lives. We have lotsof information, but in an Internet age wetoo cannot cope with our own NiagaraFalls of data, particularly since in this tran-sition age the news media no longer serveas a effective path to the truth, if they ever did. Why do public opinion polls opposewhat few understand? We fear Congress -with justification.

As Congress continues considerationof sweeping financial regulatory modern-ization - I would argue their first step


Michael M.Van BuskirkPresident & CEO

Vices of the Political System of the United States

random thoughts

“Most members of Congress are hardworkingand bright; but the systembreeds selfish interest.”

should heed the advice, “Physician, heal thyself.” Our legislative machinery is broken. It is time for another constitu-tional convention.

Even if you agree with me, no constitu-tional convention will take place anytimesoon so please stay in close touch with yourown legislators and their aides. Most arewell intentioned. The machinery may bebroken but we can still influence positivechange. They’ll need your active help if wehope to keep Congress from killing thepatients they were elected to heal.


Go to www.ohiobankersleague.com to catch up with the latestnews as it happens in the Ohio banking community.

View our calendar of events; getinvolved in online political grassrootscampaigns; find a product or service;browse our banking news section; or enroll in the latest in banker education programs.

It’s all there.

Find Us on the Web


Banks from across the size spectrumattended the 2010 Fly-in. Here, USBank’s Kurt Treu talks legislationwith Sen. Sherrod Brown

Pending laws and regulations could impact banking for the next generation. Ohiobankers are responding to the challenge by rolling up their sleeves and going to workeducating policymakers on how the current bill will impact constituents and the localeconomy. In March, 34 bankers made the trek to Washington D.C. as a part of the OBL

annual D.C. Fly-in to state the case on behalf of the banking industry. OBL ChairmanTom Moore said the pending regulatory reform bill played a big role for this year’sbankers. “Our goal was to continue to focus our attention on the sections of the billthat will impact all Ohio banks,” he reported. “While it still contains several provisions that will unnecessarily add costs and

interfere with serving our customers, the many improvements incorporated over the objection of the President and Speaker of the House are the result of the clear,consistent message delivered by thoughtful bankers from every community in thecountry. Ohio bankers have played a big role in delivering that message.”Tom Wiseman, president & COO for Ohio Valley Bank commented “I was

extremely impressed with the organization and content of the OBL event. I found it interesting that OBL was able to get appointments with the actual members of Congress rather than staffers. Obviously that is a result of OBL’s hard work and theindustry’s standing with our elected officials.”

“I found it interesting that OBL was able to get appoint-ments with the actual members of congress rather thanstaffers. Obviously that is a result of OBL’s hard work andthe industry’s standing with our elected officials.”

Grassroots Initiatives

Ohio Bankers a Big PartOF THE

ON THE Reg Restructuring Proposal

— TOM WISEMAN, OHIO VALLEY BANK

By Jeffery D. Quayle, OBL SVP & General Council

More than 30bankers were in D.C.


IN P I C TUR E S

First National Bank of Dennison’s BlairHillyer talks regulation with OCC staffers

OBL staffer Jeff Quayle; First National Bank of Dennison’sBlair Hillyer; and the OCC’s Jennifer Kelly and Julie Williams

First State BankPresident & CEO MikePell reads up beforelegislative meetings

KeyBank’s Ann Feleppelle; the OBL’s Jeff Quayle; Rep. Steve Austria (R-7); NationwideBank’s Brian Bacon and Lynn Greenstein; and Community Bancshares’ Tom Will

Huntington’s BarbaraBenham meets First

Senior DeputyComptroller and

OCC Chief CounselJulie Williams


Charlie CrowleyManaging DirectorStifel Nicolaus

Michael VoinovichManaging DirectorStifel Nicolaus

The BankM&A Market

Where Have All the Deals Gone?

Between Jan. 1, 1988 and Jan. 1, 2008, the number of independent banksand thrifts in the United States decreased from approximately 17,300 toapproximately 8,500. In most years in the 2003-2007 timeframe, 250-300mergers per year were being announced nationwide. This reflected a normal“survival of the fittest” progression in which an industry plagued by too manycompetitors went through an orderly consolidation process. Then the industry hit the wall -- hard. From June 30, 2007, when the first

cracks in the subprime mortgage market began to register in the eyes ofinvestors, until the first quarter of 2010, the SNL Bank and Thrift indices weredown by roughly 55-65 percent. Seemingly overnight, we have gone from astrong economy to a very fragile economy. The banking industry, generallyrespected until very recently, has borne the brunt of governmental and mediaattacks which have created a different perspective.With such a dramatic shock to the system, it is no wonder that healthy

bank M&A activity has pretty much come to a standstill. A large number oftransactions were terminated during the market plunge of 2008, and mostindustry players have chosen to hunker down and stay focused internally on asset quality and capital measures since then. The drop off in activity hasbeen dramatic:

350

300

250

200

150

100

50

0

2003-07Average

M&A Transactions

2008 2009 2010Annualized

The results above are obviously theresult of decisions being made (or notmade) in board rooms around Ohio andaround the nation. Among the reasonsthat activity has been slow (and will remain slow for a little while) are the following:

•Weakened purchasing power. Aprospective buyer that has seen itsstock price cut in half is not necessarilyin the mood to issue a lot of newshares in an acquisition. Just like traveling to a foreign country whenthe dollar is weak, the relative price of an acquisition seems way tooexpensive when the buyer is spendinga depressed currency.•Need to preserve capital. Banks of allsizes have experienced higher loanprovisions, higher FDIC premiumsand other headwinds that have dra-matically weakened earnings. Alongwith that unfortunate trend, the regulators (and shareholders) arepushing for significantly higher levelsof capital than had been the normuntil recently. Since most M&A dealsstretch the tangible equity levels of abank, any strategic benefits (or EPSaccretion benefits) have been out-weighed by capital preservation needs.•Lack of trust in asset quality. Prettymuch every bank has seen some surprises in its own loan portfolio.Whether a bank considers itself to bea buyer or a seller, there is an under-standable hesitation to take on some-body else’s credit problems, when thebank already has too many of its own.•FDIC deal overhang. For the relativelysmall slice of the industry that is largeenough and healthy enough to consideracquisitions, the thought of pursuinggenerous FDIC loss-sharing dealsseems more enticing than the risk of a“healthy” bank acquisition. Thus,even in a state like Ohio which hasseen very little FDIC deal activity, theperception of possible FDIC deals tocome has been a factor in limitingoverall M&A volume.

•Relatively poor multiples for the seller.M&A activity is at a 20 year low, andso are M&A multiples, at least on aprice to tangible book basis (a P/Ebasis is another matter). Many banksthat would like to sell for one reasonor another are simply choosing to waitfor a better environment. Particularlyif the bank has some issues of its own,this may be the prudent thing to do.It is tough to sell a distressed propertyinto a distressed market while hopingto achieve optimal results.

So much for the bad news. Will themarket eventually turn? Of course it will.And in the meantime, this represents a terrific opportunity for strong and entrepreneurial buyers to enhance theirfranchises. Banks such as FirstMerit andFirst Financial have been able to makebold expansion moves on financiallyattractive terms with FDIC deals. NB&T Financial recently expanded intoattractive adjoining markets at a reason-able price by acquiring CommunityNational in Franklin. Excel Financial com-pleted a creative recapitalization transac-tion with Ohio Legacy in Wooster. OtherOhio banks are in the process of raisingcapital and buying branches.

One opportunity that hasn’t played outyet is the strategic merger. In the good olddays of a few years ago, if a bank trading at160 percent of book wanted to acquire aslightly smaller company that may havebeen trading at 150 percent of book, themath did not work. The amount of good-will created would have killed the leverageratio and the tangible book value per shareof the buyer, and the combination wouldhave stayed on the drawing board. Today,one of those banks may be trading at bookand the other one may be trading at 80percent of book. As long as both boardscan take a longer term view, and realizethat shareholder value is not being maxi-mized in the short run, a very interestingand attractive deal could occur. The com-bined entity could cut costs, have a higher

lending limit, etc. The social issues impacton customers, employees and the commu-nity would be fairly benign. And both setsof shareholders could emerge from this dif-ficult environment with a more liquid andmore valuable stock.

Way too many banks are stuck on whatthey may have been worth a few years ago,and they are ignoring the potential tounlock considerable value right now. If acompany sells for cash, it has the certaintyof cash but gives up the potential upside ofa recovering economy and market. If acompany swaps its stock for a better stock,even if the multiple is disappointing today,the bank’s shareholders can get a substan-tial market premium today, and they canride back up with the buyer’s shareholdersas the market continues to recover.

Every environment offers challenges as well as opportunities. This period hascertainly offered more challenges thananyone would have ever wanted toencounter. Bank stocks have started torecover from the depths of early 2009. Ifwe can get any sort of real improvement inthe economy, in unemployment levels andin real estate values, additional capital willcome back to the banking industry. Whenit does, bank stock prices and bank M&Aprices should increase as well. At thatpoint, FDIC deals will hopefully be moreinfrequent, and there will be some pent-updemand by increasingly healthy buyers.We believe that the next few years will present some great opportunities for growth and profitability, and for therecovery of shareholder value.Views expressed in this article are solely those of theauthors. Charlie Crowley and Michael Voinovichare Managing Directors in Stifel Nicolaus’Financial Institutions Investment Banking Group.They are based in Cleveland and can be reached at216-593-7306 and 216-593-7309, respectively.They specialize in merger advisory work and capitalraising for financial services companies. Founded in1890, Stifel Nicolaus is one of the nation’s leadinginvestment banks serving the financial services sector.


Bank compensationhas been much scrutinizedover the past two years due to theeconomic environment and govern-ment intervention. Headlines across thenation focus on excessive bonuses, rich severancepackages, and luxury expenses for executive officers andlenders. As a result, the Treasury, Bank Regulators, and the international Financial Stability Board have released various compensation guidelines and proposals.

Most of the recent bank compensation proposals and guidelines focus on thedesign and features of annual incentive plans, long-term incentives, and executive benefits. With limited base salary increases, many banks rely on appropriately designedincentive programs and benefits to motivate key officers and employees.

Annual Incentive Plan TrendsDo your annual incentive plans encourage unnecessary risk? This is the question that

has been asked by the Treasury, Regulators and the SEC. As a result, many banks are review-ing their incentive plans for risk and to determine if payout opportunities are reasonable.

Per regulatory guidance, lender and producer incentive should account for the riskhorizon or timeframe of the product or services sold. Many incentive plans that have traditionally paid lenders on a monthly or quarterly basis are adding a holdback provision


Are your Compensationand Executive BenefitPrograms Ready for 2010?

Michael BlanchardBlanchard Chase

Lou MooreClark Consulting

where a portion of the incentive is helduntil the end of the year to ensure creditquality. Other banks may hold or defer aportion of the payment for two to threeyears and some are paying a portion ofannual incentives in stock, with two tothree year vesting schedules.

Many banks are now taking a closerlook at the performance criteria utilized inthe annual incentive plan. Historically, themost common criteria have been prof-itability measures such as Return onAverage Equity, Return on Average Assets,Net Income and Earnings per Share.

Most banks still use profitability meas-ures to calculate a portion of the annualincentive plan payout. However manybanks are moving towards a combinedapproach, where profitability counts for50-75 percent of the incentive calculationsand the achievement of strategic goalsaccount for the remaining 50-25 percent.For lenders, banks are moving away fromthe sole use of loan production. Loan profitability goals and asset quality goalsare becoming more prevalent and help mitigate risk in these plans.

Other types of performance criteria inannual incentive plans include the following:1)Deposit Growth: In the past two tothree years, deposit growth hasbecome the second most popular overall bank criteria utilized. Mostbanks are focusing on “core” depositssuch as checking accounts, moneymarket accounts, and other low interest deposits.

2)Asset Quality: As the focus shiftsfrom growing loans to managing loans, asset quality goals (such as non-current to current loans, non-performing assets, and classifiedassets) are being incorporated as a factor in incentive plans.

3)Regulatory Ratings: Regulatory ratings are commonly used as a qualifier that must be achieved inorder to receive any incentive payout.

In the past this may have been aCAMELS rating of two;

however in this

environment some banks are trying toachieve a rating of three.

4)Discretionary Payouts: Some bankswill base 25 percent of the annualincentive on a discretionary measuresuch as an individual performanceevaluation or achievement of strategicgoals that support the long-term viability of the bank.

5)Capital Raising: Many banks are now focused on raising capital andincorporating this measure into theirincentive plan. This allows the Bankto reward key officers that spend a sig-nificant amount of time raising capital.

6) Peer Group Comparisons: Usingregional peer group data to help setoverall bank performance goals hasbecome more prevalent.Incorporating peer group data intogoal setting for the incentive planallows for the consideration of eco-nomic conditions and as a check thatoverall bank goals are realistic.

Long-Term Incentive PlansLong-term incentives are designed to

align the executive’s interest with theshareholder and are usually linked toincreases in stock price (for public banks)or book value (for private banks).

Most stock banks will use stock optionsor restricted stock to motivate and retaintheir executives and key producers. Themarket decline has rendered many optiongrants “underwater”, which means thatthey have an exercise price greater thanthe actual stock price. While many bankshave explored re-pricing or exchangingthese options, most have decided to leavethe underwater options alone.

Restricted stock (full value shares witha time or performance-based vesting) isbecoming more popular in today’s eco-nomic environment. Some proponents ofrestricted stock suggest that stock optionscan be risky because they are based solelyon stock appreciation and there is nodownside or real loss for the recipient if thestock fails to appreciate. Others like theretention aspect of restricted stock as theseshares maintain a value, even when stockprice decreases. Another advantage ofrestricted stock is that it preserves sharesin a plan, as fewer restricted shares are

needed to match the same expensevalue of stock option grants

(usually a 3:1 or 4:1 ratio). Stock ownership guidelines for execu-

tive officers and Board of Directors are alsobecoming more common. Typical owner-ship guidelines are a multiple (two to threetimes) of base salary or annual directorcompensation. Some banks are also addingequity holding requirements which mayrequire the executive to hold a certain por-tion of stock grants (i.e., 50 percent) untilretirement or until the equity ownershipguidelines are met.

Executive Benefit ProgramsMany banks are taking a close exami-

nation of benefit programs including non-qualified retirement plans for executiveofficers and directors. These types of pro-grams are designed to help offset shortfallsin benefits for executive officers due togovernmental limitations on qualifiedplans such as a 401(k) plan. These plansalso act as a strong retention and recruit-ment device as the executive must staywith the bank for an extended period oftime to receive this benefit.

Typically supplemental executiveretirement plans are designed to replace 60 percent to 80 percent of the executive’sfinal pay (factoring in social security and bank sponsored qualified benefits).The objective is to provide a level of compensation in retirement similar toother individuals in the organization thatare not limited by government regulations.

A recent trend is performance-basedretirement programs, where the annualretirement accruals or the final retirementbenefit is linked to the achievement ofoverall bank or individual performancefactors. These performance factors canimpact the dollar amount that is accruedfor the benefit plan on an annual basis(i.e., annual accruals are linked to a per-centage of base salary dependent on theachievement of annual performance goals,similar to an annual incentive plan).Another methodology is to link perform-ance to the target percentage of incomereplacement amount for the officer (i.e.,depending on annual performance over a10-15 year period of time, an executivewould receive a target retirement benefitbetween 20 percent to 40 percent of finalbase salary).


Review NowNow is the time to review the compen-

sation and executive benefit programs for your executives, producers, employees,and the Board. Typically the review is conducted by the bank’s compensationcommittee with assistance from HumanResources, the Risk Assessment Officer,and Management. Having a defined compensation philosophy that sets “guidelines” for compensation decisionsand reliable market research will help youdesign programs that are linked to thelong-term viability of your bank and keepyour bank’s compensation out of the frontpage headlines.Louis L. Moore (CA Lic # OC58738) is a registered representative of, and securities productsare offered through, Clark Securities, Inc., DBA CCFS, Inc. in Texas, 2100 Ross Avenue, Suite 2200, Dallas, TX 75201-7906, Ph. 1.800.999.3125, member FINRA and SIPC.


Paying for performance is big business in many U.S. workplaces. Employers nowspend almost twice as much on incentive-based compensation as they did 15 yearsago and, in 2010, national surveys predict variable pay will account for almost 12percent of the typical employer’s compensation budget.

Not just how much, but on what basis you pay your top performers and executives has taken center stage for the banking industry as Congress and bankregulators look to factor compensation risk management into everything fromTARP funds, to safety & soundness exams, to FDIC premiums. Like it or not, compensation must be a component of your bank’s risk management strategy.

To help Ohio banks noodle through these strategic issues, we’re gathering moredata than ever before on incentive compensation plans and practices. New questions have been incorporated into the 2010 OBL Bank Compensation &Benefits Survey to help you determine how your plans align with those of yourpeers. We’re also conducting a special compensation strategies Webinar - free for allsurvey participants.

By Melea Wachtman, OBL SVP of Administration

Compensation Risk ManagementGarners Expanded Focus in AnnualBank Compensation & Benefits Survey

Strategic Compensation Webinar:Compensation Planning and Designfor 2010Tuesday, April 13, 2010 – 2:30 p.m.

In this session, facilitated by leading bank compensa-tion consultant Mike Blanchard and experts from ClarkConsulting, we will explore how banks are compensatingexecutives, key officers, and producers in these tough economic times. The program will cover all elements ofcompensation including base pay, annual cash incentives,long-term incentives, and executive benefits. We’ll sharewhat banks are doing in respect to designing annualincentive plans in light of the current economic condi-tions and new regulatory/governmental guidelines. We’llalso examine equity pay and how deep in the organizationa bank should utilize stock-related programs. Finally, we will look at how executive benefit programs have been impacted by the current environment includingnon-qualified deferred compensation programs, change-in-control agreements, and executive perquisites.

In addition to an expanded compensation strategiessection, this year’s survey will again include recession-relevant questions designed to help gage the tenor of theimpact of the economy on human resources practices atOhio financial institutions. For more information aboutthe 2010 survey or to purchase your copy of the report,contact Melea Wachtman at (614) 340-7606.


Finding the time to draft this column has been a real chore. You see, given the freneticpace of the legislature this year, I’m operating in fits and starts. The glamorous life of gov-ernment relations seems to have thrust me into the arcade world of Whac-A-Mole at theStatehouse. WHACK! WHACK! WHACK! Yet, from one day to the next it isn’t alwaysapparent if I’m going to do the whacking or dodging the mallet.

Foreclosures, mediation, toxic titles, credit union public deposits, small business lending,condo association “super” liens, appraisal management companies, and IOLTA/IOTA arethe moles and swinging mallets this year. Those are the highest priority banking-relatedissues out of the 700-plus bills that have been introduced between the House and Senatethis session. WHACK!

In addition to the policy issues, this of course, is an election year. That spells goodnews, if your preference is for less government, because the elected officials want to be

back home in the districts as much as possible so that can remind voters why they should get another term in office. In addition

to all 99 House seats and 17 of the 33 Senate seats, thestatewide offices (governor, attorney general, treasurer,secretary of state, and auditor) will be voted onthis year. The stakes are especially high sincethe state apportionment board, the body thatdraws the legislative districts following thecensus, is at stake.

ForeclosuresWHACK! Earlier this year, I testified

on behalf of the industry in Senate committee todeliver our objections with the package of harmful

foreclosure bills: HB 3 – six-month moratorium, $750 filingfee, notifications, data collection and servicer regulation, HB 9 –

tenant foreclosure notification, and SB 197 – mandatory residential mediation.Our message continues to be that banks and thrifts don’t want to foreclose if they don’thave to. Yet, given the continued tough economy and mounting Ohio job losses along withborrowers’ finances being thrown off-track due to catastrophic health issues, death anddivorce, many Ohioans can no longer afford their homes. So if foreclosure is the onlyresort, all parties benefit when it is consummated promptly. Fortunately, the Senate

From theSteps of theStatehouse


By Michael J. Adelman, OBL Vice President of State Government Relations

Whack!

——————

Whack!Whack!

appears skeptical, if not concerned, thatHB 3 and SB 197 could cause more harmthan good by delaying the foreclosureprocess further and creating new fees($1,250 between the two bills) that erectbarriers to accessing the courts and disincentives for lenders to make mort-gages in Ohio.

HB 9 seeks to create new notificationrequirements to protect tenants of fore-closed rental units. The people that havefaithfully paid their rents, yet wind up onthe curb, are the true victims of foreclo-sures. Improved notification by the land-lord would seem helpful. Converting exist-ing leases to month-to-month contractswould not. Besides the fact lenders are notin the landlord business, assuming an on-going rental agreement may have the unin-tended impact of suppressing potentialbuyers at sale. Interestingly, federal lawtook effect last year, but there might bedesire in going a little further in Ohio law.

Credit Union’s Want to bePublic Depositories

WHACK! Our most pressing fight atthe Statehouse as this goes to print, is thecredit unions’ request to become publicdepositories, HB 317. There has been con-siderable legislative turnover and changeof party control since the last time wefound ourselves in this battle. We foughtwith great success in 2004; the issue diedin House committee. Articulating thosesame concerns should still resonate in2010. Two OBL member bankers and I hadthe pleasure of testifying in House commit-tee in opposition to this bill in March.

Proponents advocate local govern-ments deserve “choice” in where theyplace their deposits and with publicdeposits credit unions will foster economicdevelopment. They are adamant that tax-ation has no place in the debate. But, howcan’t it? For one, public deposits are taxdollars. Second, this bill would harm thepublic entities they think they’d help.“How is that?” you ask. For every dollardeposited in a credit union versus a bankor thrift there is a corresponding decreasein the amount of taxes that will be paid bybanks and thrifts. As the banks and thriftspay less taxes there will be fewer publicdeposits. If that isn’t convincing enough,most people probably haven’t grasped that

currently the State of Ohio effectivelydeposits approximately $20 million peryear in credit unions. You see, the creditunions are exempt from the financial insti-tutions tax, which is paid by banks andthrifts. Harkening back to my days withthe Ohio Dept. of Taxation, this exemp-tion creates a tax expenditure for theState. So just like an appropriation, con-tinuation of tax exemptions costs the Statemoney. Since the State is not collectingthat approximately $20 million per year, itis depositing that money in credit unions.

Taxation, though, is only part of the objection bankers have with requestsfor expanded credit union powers like HB 317. Bankers oppose efforts to enablecredit unions to evolve into more bank-likefinancial institutions without all of thesame regulatory obligations. Top on the listis the Community Reinvestment Act(CRA). If credit unions really still serve“people of small means,” as spelled out intheir original mission that afforded them atax-preferred status, becoming subject to astate CRA shouldn’t be a problem.

On public policy grounds, a number ofconcerning safety and soundness issueshave been raised in my meetings with leg-islators. First, being a public depositoryisn’t cheap. Depositories must set aside105 percent of the amount of the publicdeposit. This over-collateralization meansfunds above and beyond what they receivefrom the public entity must be set asideand can’t be loaned out.

The credit unions testified that onaverage they have seven to eight-percentcapitalization. Maybe that’s adequate. But,unlike a credit union’s NCUA insurance,this can’t be booked on both sides of their ledger.

Second, there are liquidity questions.Why do the credit unions seem so interestedin gaining these public deposits that tendto be shorter term funds: 30, 60, 90 ormaybe up to 180-day money?

Third, there are a number of privatelyinsured Ohio credit unions. Should they bepermitted to hold taxpayer funds? I’velearned this was a deciding factor in thedefeat of a similar bill in Colorado earlierthis year.

Fourth, a credit union’s customers are itsowners. So does the placement of a publicdeposit in a credit union also translate intoownership of that credit union by the public

entity? If it does, then is it appropriate forthe public entity to take on the risks ofloan losses, etc, which they’d bear likeevery other owner of a credit union?

Fifth, being a public depository requiresa level of sophistication on the part of both the financial institution as well as the regulator with regards to securitiespledging. Are the credit unions and theirregulators up for the awesome responsibilityof guarding the funds entrusted in them bythe public?

Star OhioIt’s ironic to me that some public offi-

cials have testified that they need morechoices to deposit their funds. They’ve allexpressed the need to increase their yields.This is puzzling because it seems theyshould first be focused on safety. But, also,local governments haven’t been shy aboutchoosing to deposit funds in STAR Ohio.Bankers have long given me an earfulabout their objections to this state-subsidized competitor. Created in the dayswhen banks and thrifts couldn’t branch intomultiple counties, the State Treasury AssetReserve Ohio program is a State Treasuryinvestment tool that gathers billions of dol-lars per year from communities across theState. Bankers tell me that with the excep-tion of the recent historically low interestrates, STAR Ohio has set rates around thestate for the past three decades. Manytimes banks and thrifts found it tough tomatch the seemingly unrealistic rates localgovernment officials were chasing with thestate-subsidized competitor. The last thingthey need are 400 more tax-subsidizedcredit unions competing for deposits. Thisbill seems to be the last thing the state andlocal coffers need as well. WHACK!

Don’t forget to register for the OBL’sannual Day at the Capitol, the Ohio bank-ing industry’s premier grassroots event.This year’s program is Tuesday, May 11, atthe Athletic Club of Columbus. Your OBLgovernment relations staff will brief you onpertinent issues relating to banking beforesending you off to meet with your statesenator and representative. I hope that youare able to join fellow bankers at theStatehouse for this critically important andfun grassroots event.


Ohio has a long and storied history ofsending brave men and women to serve inour nation’s armed forces. To support veter-ans for their service, the Ohio BankersLeague has joined the American BankersAssociation, the Independent CommunityBankers of America, OBL’s endorsed part-ner, the Senior Housing Crime PreventionFoundation, the Armed Forces VeteransHomes Foundation and the NationalAssociation of State Veterans Homes to ensure that 40,000 veterans living in 160 veteransnursing homes in the United States will have the benefit of the Senior Housing CrimePrevention Foundation’s Senior Crimestoppers program.

The men and women who live in our nation’s veterans homes should be allowed to liveout the remainder of their lives in safe and secure environments that are free from the dailyfear of crime, abuse, neglect, hostility and deprivation of personal freedom. According toSenior Housing Crime Prevention Foundation Chairman Charles “Chuck” King,“Protecting our nation’s 40,000 elderly veterans living in long-term care is a need that mustbe addressed, and I can’t think of a better way to get this done than by asking every bankin the country to allocate a portion of their annual Community Reinvestment Act (CRA)budget to secure the Foundation’s successful Senior Crimestoppers program.”

Many Ohio banks have actively participated in the Senior Crimestoppers program fornursing homes since the association endorsed the program in 2002. The program is admin-istered by the Senior Housing Crime Prevention Foundation, a non-profit organizationestablished in collaboration with the Office of the Comptroller of the Currency to providea vehicle for banks to earn CRA credit through support of low-to-moderate income nurs-ing home residents. The program has a proven track record of 92.76 percent nationwideand 91.03 percent in Ohio.

Under this initiative, each veteran resident will be provided a specially designated personal lockbox and access to an anonymous, toll-free tip line that pays cash rewards upto $1,000 on each incident reported. In addition, the Foundation will provide each stateveterans nursing home with its annual Time of Your Life video series for the residents’enjoyment, and each facility will receive an annual cash contribution for a Wish ComesTrue grant to be given to select veterans.

Ohio banks will be asked to support this program by making a direct, no-risk, fully collateralized CRA loan or investment to the Foundation. The loans or investments willrange from $250,000, which sponsors 10 veterans in the program, to $2.5 million, whichsponsors 100 veterans.

Participating banks benefit from the program, just as do the veterans. They receive dollar-for-dollar CRA credit for the loans and investments funded and also receive excellent exposure and positive public relations for participating in the program and supporting the veterans. The Foundation provides banks with support regarding publicrelations efforts and marketing.

Support the nation’s veterans and join the thousands of banks that we expect to participate in this program, and help the men and women who defended our freedom bycommitting to helping our nation’s veterans. At a time when the banking industry’s imageis somewhat tarnished in the eyes of many, what better way to get some positive publicityin your local community?


Lori L. MillarVice PresidentSenior Housing CrimePrevention Foundation

Senior Housing CrimePrevention Foundationto Aid Elderly Veterans

Look for information from the Ohio Bankers League office

regarding informative webinars to educate you and your staff on the program and its benefits to Ohio veterans and to your bank.

If you would like information immediately, contact Mike Baker at [email protected]

or Terry Rooker at [email protected]



Susan PolingOBL CommunicationsManager

Excellence Through Education

New Community Bankersfor Compliance Programa SuccessNot joined this valuable program? Become a member by May 17

As a provider of top-quality education programs, it is no surprise that the nation-ally-recognized Community Bankers for Compliance Program – the most successfuland longest running compliance training program in the country – kicked off the 2010training calendar with a bang.

More than 60 bankers attended the first quarter seminar on Fair Lending & TheSAFE Act at the OBL Training Center on Feb. 19, presented by Young & Associates,Inc. – and all returned to their bank armed with a detailed and highly-coveted 220-page reference manual. These bankers will return to Columbus on Tuesday, May18 for an intensive program on Regulation E and Open-End Regulation Z.

“These CBC quarterly seminars are just one of the many benefits of CBC Programmembership, but the face-to-face training is one of the most common reasons banksjoin,” explained Julie Kiplinger, OBL manager of professional seminars and in-banktraining. “Members may also take advantage of a detailed monthly online newsletterthat provides regulatory updates and a compliance calendar, as well as access to a toll-free Compliance Hotline and a CBC members-only Web page.”

Dawn Kincaid, compliance officer at The Ohio State Bank, found the entire program to be “excellent” and found the best feature to be the “great manual and theuseful application examples from the presenter.” Most all participants agreed withKincaid and note the manual as a tool that will be put to use again and again.

“The CBC Program is designed to assist members in getting timely answers to theirquestions, as well as testing techniques before they are implemented in the bank,” saidpresenter Bill Elliott, senior consultant and manager of compliance, Young &Associates, Inc. “In addition, each program features regulatory updates that our participants find invaluable – and that the regulators approve not only for its compre-hensiveness, but also for its practicality.”

Who Should Participate?In today’s times, it is essential that your bank’s compliance officer participate in

this program; however, since regulatory compliance is approached from a team per-spective, it is beneficial to send additional employees from the customer service, lend-ing or operations departments to sessions on topics that relate directly to their positions inthe bank.

Pro-Rated Program Membership: April – December 2010“We know this program is one from which every one of our member banks will

benefit. But since it was new in 2010 and had an early start date – we have decided toextend an opportunity for others to join at a pro-rated CBC Program membership


Presenter Bill Elliott, Young & Associates, Inc., and Bill Showalter,OBL Compliance Services consultant, form a unified team forOBL member banks, as between the two, areas covered includeaudit and consulting services, as well as education and training

More than 60 bankers attended the first CommunityBankers for Compliance Program seminar on FairLending & The SAFE Act. All returned with a detailed220-page reference manual

There are currently only 10 seats available.* They will be filled on a first-come,first-served basis at the following cost:

For members of the Ohio Bankers League, the pro-rated price of the program is $1,000from April through December. This includes attendance at each of the three remainingquarterly seminars for one (1) representative from your bank, detailed manuals, themonthly Compliance Update newsletter, and on-line and toll-free access to Young &Associates for compliance questions that arise between meetings. Or, your bank can sendtwo (2) representatives from your bank to all four sessions for just $1,250 if you register inadvance (additional representative is just $250).

For banks that are not members of the OBL, the pro-rated price of the programis $2,500. Or, your bank can send two (2) representatives from your bank to the threesessions for $2,750 (additional representative is $250).

Based on a two-person CBC Program membership, this equates to an average of just$208 per person per seminar, making the CBC Program cost-effectiveness unbeatable.

*Please note: If your bank is already registered as a CBC Program member and youattended the February CBC program, you are already registered for the May seminar.

Individual SessionsFor members of the OBL and the CBC Program, the price to send additional repre-

sentatives from your bank to an individual session will remain $255 per person per session.For banks that are not members of the OBL, but are members of the CBC Program, theprice to send additional representatives to an individual session from the bank will remain$375 per person per session.

Check the OBL Web site for online registration or contact Julie Kiplinger at614-340-7612 with any questions or to request a copy of the brochure.

Regulation E & Open-End Regulation Z – May 18The next CBC Program seminar will cover all aspects of Regulation E, with a focus

on the upcoming July 1, 2010 changes. This presentation will focus on the require-ments of the regulation, and will be presented in a format that allows for staff training.The open-end Regulation Z changes will include some credit card issues; however,there are additional changes that will impact other open-end accounts, includinghome equity lines of credit. In addition to these regulations, the program will cover twomore sections of the FACT Act that are effective on July 1, 2010, including Accuracyand Integrity and Direct Dispute. While neither of these sections should present majorproblems for banks, they do have requirements for formal policies and bank proceduresthat will need to be modified to accommodate the new requirements.

Special Events

CEO SymposiumMay 25 – 26

OBL & CBAO Bankers’ Day ReceptionJune 29

Ohio Bankers’ Day 2010June 30

OBL Joint ConventionSept. 9 – 12 (French Lick, IN)

Annual Meeting & Professional Development EventNov. 3

Keep this current listing of professional training & development opportunities andcheck the OBL Web site at www.ohiobankersleague.com for additional programs.

Classroom SeminarsAppraisal ReviewApril 13

Ohio Deposit Documentation Seminar April 15 & Sept. 8

Regulatory & Accounting Banking FundamentalsApril 27 – 28

Regional Directors Workshop,OBL Training Center, ColumbusApril 27

Regional Directors Workshop,Findlay Inn & Conference CenterApril 28

Regional Directors Workshop,Hilton Garden – ClevelandApril 29

Understanding & Preparing the Federal Call ReportMay 4 & Oct. 20

Basics of Loan Decision Makingfor Lending Support PersonnelMay 11

Personal & Business FinancialStatement AnalysisMay 12

Banking 101: Overview ofFundamental Banking PrinciplesMay 13

Regulation E – A CommunityBankers for Compliance ProgramMay 18

Safe Deposit Security, Liability & Legal Issues May 27

Collection Seminar for Ohio Bankers June 10

Loan Review: Today’s ExpectationsJuly 13 – 14

Today’s Community Banking Model: There is No “Normal” AnymoreJuly 15

Auditing Real Estate LoansAug. 26 – 27

ALM SeminarSept. 2

Bank Security WorkshopSept. 15 – 16

Electronic Banking & Regulatory ComplianceOct. 13


Attendees at the 2009 DirectorsWorkshop at the OBL Training Center.More than 100 bankers attended theprograms in Columbus and Findlay

“OBL educational programs provide us with timely and relevant insights into the issues bankers face daily. With the expertise provided at these programs, we gain the ability to prepare and develop our staff to managethese daily challenges.”

— Cynthia SparlingVice President Human Resources & Retail BankingFarmers Citizens Bank

Education Calendar Highlights 2010 Dates to Save

Directors TrainingHeld across Ohio each spring, the 2010 Directors Workshops will feature the

Role of the Board in Risk Monitoring and Strategic Planning. Designed to be bothpractical and relevant to the current environment, the program is once again led byJim Clarke, Ph.D., a nationally recognized asset/liability management consultant.

• COLUMBUS - OBL Training Center, Columbus – April 27• FINDLAY - Findlay Inn & Conference Center – April 28• CLEVELAND - Hilton Garden Inn – Cleveland Airport – April 29

CEO SymposiumMay 25 – 26

Compensation Risk Management,Avoiding Liability and The New‘Norm’ for Capital are just a few of the topics expected to be addressed atthe 2010 CEO Symposium, May 25 & 26 at the Hilton Columbus atEaston. The first day will also featurethe informative and well-receivedRegulatory Panel with the FDIC,OCC, OTS and Ohio Division ofFinancial Institutions. Registrationwill begin at 1 p.m. on May 25 andwill include an afternoon of program-ming, followed by an evening recep-tion. Sessions on May 26 will run from8:30 a.m. – 3 p.m. A discounted roomrate is available for $179 at the Hilton(614-414-5000) until May 3. Be sureto mention you are with the OBL.Questions can be directed to StacySchindler at 614-340-7608.

Schools & ConferencesBSA/AML ConferenceApril 22 – 23

Lending Essentials SchoolMay 19 – 20

Mortgage Lending SchoolAug. 18 – 20 (Indianapolis)

Advanced Agricultural Lending Conference Sept. 1 – 2 (Purdue University)

Advanced Compliance SchoolSept. 21 – 22 (Indianapolis)

OBL Bank Management SchoolSept. 26 – Oct. 1

Bond Math UniversitySept. 28 – 30

School of Bank ComplianceOct. 25 – 29 (Indianapolis)

OBL School of Commercial Lending EssentialsNov. 17 – 19

Midwest Agricultural Banking SchoolNov. 29 – Dec. 1 (Purdue University)

E-LearningBusy Days Don’t Always Allow for Necessary Training.

That’s why the OBL is extending a special offer to OBL members. Throughout 2010,for every five OBL Webinars and On Demand programs your bank purchases through theOBL, you will get one FREE!* That is a $255 value - nearly a 20 percent savings. Any topic- any day! It is up to you and your staff to select areas where training is needed most. Checkthe Education/Webinar listing on the OBL Web site for a complete listing of availableWebinars or the E-Learning listing for a wide variety of On Demand programs on such topics as RESPA, Fair Lending and new Overdraft Protection Rules.

*(Please note this offer does not apply to GSB Webinars).


Deb Schenk, The Mechanics SavingsBank, receives an autographed bookfrom keynote speaker Jim Beardon atthe 2009 CEO Symposium

Thanks for offering yesterday’sseminar on information security. Ipicked up a great deal of valuableinformation, and the speakers wereextremely knowledgeable.

— Rick BagbyCompliance OfficerStanding Stone National Bank OBL Bank Management School

Sept. 26 – Oct. 1

Let the graduates speak for themselves. One hundred percent of the 2009 OBLBank Management School students would recommend this School to their friendsor colleagues as the program met 100 percent of the graduates’ expectations! This intensive one-year bank management course curriculum and participation in a Bank Executive Simulation provide excellent training for those interested in gaining a competitive edge for their career and institution. Graduates become a valuable asset to their bank as the students gain a comprehensive and practical overview of the financial services industry and the interrelationships ofeach banking function.

Advance coursework can begin today – with the first project deadline set for May 24. Just $250 is due upon registration with the balance not due until Sept. 1, 2010.

THE OHIO BANKERS BENEFITS TRUST

The Health Plan Designed by Bankers for Banks

The Ohio Bankers League represents Ohio’s finest financial institutions by not only offering products and services to satisfy compliance, education, communications andgovernment relations but also by offering a health plan designed by community bankers.

The Ohio Bankers Benefits Trust is a self-funded health plan sponsored by the OhioBankers League. Established in 1952, the OBBT has grown to nearly 80 participating members and insures over 2,000 lives. The Trust offers a cafeteria style program includingmedical, dental, vision, and life benefits. This comprehensive menu of insurance optionsallows employers to meet their budget goals while allowing employees to meet their family needs.

The OBBT is governed by six trustees, who are both bank presidents and OBBT members. The current serving trustees are Tom Moore (chairman), First Federal Bank ofOhio; Courtney Haning, The Peoples National Bank; Ronald Keaton, Fairfield FederalSavings & Loan; John Malanowski, First Federal Savings & Loan; Paul Reed, Farmers Bank& Savings; and Thomas Will, Community BancShares.


Gary L. SutterOBL Employee BenefitsManager

Wendy M. HenchOBL OBBTAdministrator

What message would you like to send to both members and non-members regarding the advantages of the OBBT?

Tom Moore: If a health insurance agent offers you a one year quote that appears tobe too good to be true, check their track record for rate increases the next year. TheOBBT does not low ball bids for one year in order to get the business.

Paul Reed: I remember one of the selling points of the Trust, besides cost, was theinvolvement of bankers being a part of the decision making process. As a trustee Ihave the privilege of seeing how significant that is. Each year when we consider rateincreases I am impressed how much weight is given to the impact on our memberbanks. Granted, the trustees must protect the interest of the trust and we mustmake certain our members are protected with adequate reserves but our discussionsalways address what is the minimum amount needed to meet those goals…Not howmuch can we get away with. As a result, during the last few years, we have beenable to increase the benefit offerings while keeping the rate increases to belowindustry averages.

As trustee, what do you view as the single most accomplishment of the OBBT?

Court Haning: The OBBT provides OBL members an alternative to open marketemployee benefits and allows bank employees to share risks/cost with the like type enrollees.

John Malanowski: The OBBT continues to offer a quality product with qualityservice for a fair price.

With healthcare costs continuing torise, you might be surprised to learn thatonly one percent of all healthcare cost isspent on prevention. The Ohio BankersBenefits Trust has an answer to this dilemma, recognizing the important roleimproved health plays in decreasing therisk ultimately shared by all.

A new comprehensive wellness program offers up to $1,000 annually inwellness expense per adult. Bankers insuredby the OBBT receive preventative serviceswithout limitations for the first $1,000,with no out of pocket expense.

In 2009 the OBBT partnered withInteractive Health Solutions to provide anon-site health risk assessment that com-bines a set of 34 diagnostic blood tests withblood pressure checks and personal healthhistory. The tests evaluate cardiovasculardisease risks, diabetes, liver and kidney dis-ease and blood, bone, and muscle diseases.It is no longer a scheduling nightmare for employees. The program offers evalua-tions on-site that take less than 10 minutesto complete.

In addition to the testing, each partici-pant receives a personal health report,access to research and current health newsbased on individual results, and one-on-onelifestyle related courses on topics such assmoking cessation, weight loss, and betternutrition. The OBBT wellness programallows for all employee and spouses to par-ticipate in the testing. IHS handles thebilling which is run through the OBBT andapplies to the generous $1,000 benefit. Thewellness maximum covers any and all pre-ventive measures, tests, and vaccinations.

The need for prevention has extendedbeyond workouts at the gym and diets. Beproactive, empower those around you tobecome aware, receive annual checkups,and be accountable.

Paul Reed, President & CEO Farmers Bank and Savings Company:This is our second year with IHS wellness screening and the results are encourag-ing. Last year our participating employees, upon receiving their results, establishedpersonal goals for the year. This year most of their numbers improved, giving us ahealthier workforce. Thanks to the wellness benefit some employees made lifestylechanges and remain focused on their health goals. As a final note, I know of several local doctors who were impressed with the depth of the tests performed withone saying, “I wish our tests were that comprehensive.” I think the unsolicitedendorsement from a highly trained physician reveals how significant that benefit isto our members.

Greg Kirk, Vice President, Galion Building & Loan Bank:I highly recommend the health testing that IHS offers. It is a top notch service com-pany. Everyone - from representatives at the home office in Chicago who answeredquestions to the plebotomist who did our testing - was professional, courteous andvery helpful. We did our testing on a Friday and we had our results online just threebusiness days later. We will continue to take the opportunity to do the IHS testingevery year.

Brenda Arnold, Administrative Assistant, OBL BankServices: Wendy Hench is the Administrator of the OBBT and we work together at the OBL.She and I became fast friends and I quickly discovered she is very passionate abouther job. One of the benefits she is most passionate about is the IHS benefit.

Much to Wendy’s chagrin, I did not participate the first year this was made avail-able to us at the OBL. I didn’t want to know what secret illnesses might be lurkingin my system and was quite content to believe no news is good news. Not alwayssuch a good decision when it comes to your health. The second year I didn’t get off so easy with Wendy’s constant “nagging” and I took the assessment. I tested positive for hypothyroidism which causes fatigue and weight gain. My doctor confirmed the results and immediately started me on a regimen of Synthroid.Within weeks my energy level increased and I lost weight! Due to my findings, mytwin sister discovered she also has this condition and is now on medicine. If I hadn’t accepted Wendy’s challenge, I would still be living in the shadow of hypothyroidism. Now I’m free. This changed my life. It might just change yours too.


Employee Health is in Your Hands

WHY WELLN

ESS

Companies that act now can minimize their own cost and increase productivity of their organization. To learn more about the wellness program, or the OBBT in general, please contact us at [email protected] or [email protected] or call (614) 340-7595.



TheRoadAhead

Changes in Labor and

Employment Law

for 2010

Richard L. MoorePartnerVorys, Sater, Seymourand Pease LLP

Many of the changes in the area of labor and employment lawthat we saw at the end of 2009 will set the stage for even morechanges as we enter a new decade. What are the key changes thatemployers should be aware of going into 2010? Read on.

WHAT HAS COME TO PASS. . .The Americans with Disabilities Act Amendments Act of 2008 (“ADAAA”)

The ADAAA took effect Jan. 1, 2009, but its real impact will likely be felt over the nextdecade as new cases are filed under the Act. The ADAAA retains the ADA’s basic defini-tion of “disability” but changes the way that the term should be interpreted, which has theeffect of enlarging the number of people protected by the law.

The Act expands the definition of “major life activities” by including two non-exhaustivelists. The first list includes many activities that the EEOC has previously recognized (e.g.,walking) as well as additional activities that have not been specifically recognized (e.g., read-ing and communicating). The second list includes major bodily functions (e.g., circulatoryand reproductive functions).

The Act also expands the number of potentially covered individuals by providing thatmitigating measures, other than ordinary eyeglasses or contact lenses, are not considered inassessing whether an individual has a disability. Similarly, an impairment that is episodic orin remission is a disability if it would substantially limit a major life activity when it was active.

H1N1On Oct. 9, 2009, the EEOC issued guidance for employers on dealing with the H1N1

virus. Entitled “Pandemic Preparedness in the Workplace and the Americans withDisabilities Act,” these guidelines suggest lawful approaches to dealing with a pandemic,such as: liberalizing sick leave policies, cross-training employees, and increasing permitteduse of flex-time.

GINAThe Genetic Information Non-discrimination Act (“GINA”) became effective

November, 2009 and prohibits employers and health insurance carriers from discriminatingagainst individuals based on genetic information. This represents the first new federallyprotected class in almost two decades.

New FMLA LawBeginning on Oct. 28, 2009, the “National Defense Authorization Act of 2010”

Extends “Qualifying Exigency” leave to the spouse, son, daughter, or parent of active dutymembers in the regular armed forces who are deployed to a foreign country. The Act alsoextends “military caregiver” leave to care for a veteran who served during the five yearspreceding medical treatment and expands “military caregiver” leave to cover aggravationof existing or pre-existing injuries incurred while on active duty.

New FMLA RegulationsOn Nov. 17, 2008, the U.S. Department of Labor issued its final revised regulations to

the FMLA. The new regulations went into effect Jan. 16, 2009.

Some of the important changesinclude: clarifying that, in most cases, anemployee providing FMLA notice mustfollow the employer’s usual procedures forreporting an absence and specifying thatemployers can count FMLA absencesagainst employees when calculating perfectattendance as long as employees takingequivalent non-FMLA leave are treatedthe same. The new regulations also clarifymedical re-certifications, make changes tothe fitness for duty certification process,and clarify that light-duty does not consti-tute FMLA leave.

In a significant concession to employers,the new FMLA regulations allow directcontact between an employer and theemployee’s health care provider for pur-poses of clarification of a medical certifica-tion form. Importantly, the law requiresthat HIPAA and other medical privacyregulations are met and employers may notask health care providers for informationbeyond what is required by the certifica-tion form. Also, the employer representa-tive making the contact cannot be theemployee’s direct supervisor. Instead, itmust be a health care practitioner, an HRprofessional, a leave administrator, or amanagement official.

The Lilly Ledbetter Fair Pay ActLilly Ledbetter worked at Goodyear for

19 years when she allegedly discovered shewas being paid significantly less than hermale counterparts. A jury agreed that shehad been paid unfairly, and awarded her$223,776 in back pay, and over $3 millionin punitive damages. The U.S. SupremeCourt ultimately threw out the award andruled that Ledbetter had waited too long tofile her case. The Court said she shouldhave complained within 180 days of a specific discriminatory event. Prior to thisruling, most courts that had considered theissue held that the statute of limitationsbegan running afresh with each discrimi-natory paycheck under a “continuing violation” theory.

Within weeks of the decision, the LillyLedbetter Fair Pay Act was introduced andon Jan. 29, 2009, President Obama chose theAct as the first bill he signed as president.

The legislation amends anti-discrimi-nation laws to clarify when discriminatoryactions qualify as an “unlawful employ-ment practice.” According to the legisla-

tion, unlawful conduct occurs when: “(1) adiscriminatory compensation decision orother practice is adopted; (2) an individualbecomes subject to the decision or practice; or (3) an individual is affected byapplication of the decision or practice,including each time compensation is paid.”

2009 COBRA StimulusThe American Recovery and

Reinvestment Act of 2009 includes a sub-sidy of COBRA premiums for individualsinvoluntarily terminated from employmentbetween Sept. 1, 2008 and Feb. 28, 2010.Specifically, beginning March 1, 2009, eligible individuals are required to pay only35 percent of the required COBRA premium. With limited exceptions, allemployees let go on or after September 1,2008, must receive notice of this subsidy.

WHAT WE MAY SEE. . .The Employee Free Choice Act

As originally proposed, The EmployeeFree Choice Act (“EFCA”) would permitunion organizers to avoid certificationelections and thus make it easier to union-ize workforces. As originally drafted, theEFCA would allow employees to secretlysign cards requesting union representation.When a majority of the employees sign thecards, the union wins.

The EFCA is subject to on-going nego-tiations in Congress and several alterna-tive, less controversial proposals have beensubmitted, like replacing the secret cardcheck with expedited elections.

The “RESPECT” ActChanges definition of “supervisor”

under NLRA to reduce the number of“supervisors”

Paycheck Fairness ActAmends the Equal Pay Act to revise

remedies for sex discrimination in the pay-ment of wages. The proposed legislationwould permit unlimited punitive and com-pensatory damages, make it easier to bringclass actions, and weaken availableemployer defenses.

Patriot Employer ActProvides tax breaks to companies that

agree to remain neutral on union organiz-ing and maintain employees in U.S.

Healthy Families ActWould require employers with 15 or

more employees to provide at least 7 paidsick days for employees working at least 30hours per week. Those working between20-30 hours per week would receive a prorata share. Sick leave could be used for themedical needs of the employee or familymembers, including for preventative ordiagnostic care.

Arbitration Fairness ActPrevents enforcement of pre-employ-

ment agreements to arbitrate discrimina-tion claims.

Civil Rights Act of 2008Among several changes that favor

employees, this act would eliminate damage caps under the 1991 Civil RightsAct; add compensatory and punitive damages to the Fair Labor Standards Act;and make it easier for employees to recoverlitigation expenses.

Employment Non-Discrimination Act

Prohibits discrimination on basis ofsexual orientation.

FOREWARN ActBroadens application of the WARN

Act and increases the length of advancenotice required prior to a plant closing ormass layoffs.

Expansion of FMLAWould cover more employers, increase

covered conditions, and provide for paid leave.

MOVING FORWARDAs we move forward into the new

decade, it will be important for all employers,including banks, to be sure their policiesand practices comply with existing lawsand to monitor pending changes. Richard L. Moore is a partner in the VorysCincinnati office and a member of the litigationgroup and the firm’s e-discovery core team. He hasa general litigation practice with specific expertise inthe areas of electronic discovery, employment discrimination, workers' compensation, construc-tion, medical malpractice and personal injury.




It’s a term we’ve all heard or used. You might have said,“Do what you say, say what you mean,” or “actions speaklouder than words,” and one of my favorite quotes frommy father, “the tongue in your shoe speaks louder thanthe tongue in your mouth.”

Sadly, in the world today, whether it be in sports, government or even banking, it seemsthat “walking the walk” may actually be a thing of the past. Day in and day out I see plentyof the talk – people issuing their guarantees, posting their mission statements, even trail-blazing “inconvenient” environmental movements. The problem is - I don’t see the walk.

It’s a popular trend among many of the banks that I walk in every day. Some of thesebanks even have the words “community bank” in their title. They have core values andmission statements plastered all over their advertising material and websites. These samebanks tell everyone: “Come experience the difference of a real community bank,” “see whatyou’ve been missing.” However, when I talk to them about providing their borrowers (orcommunity) the most superior level of service and integrity, the only thing that they aretruly worried about is price!

Take a look at Mr. Albert Arnold “Al” Gore Jr. Whether you agree with his stance onglobal warming or not, you can see that he’s done everything possible to be a leader of thismovement – except share the struggle. He’s led enormous rallies, put together rock con-certs, won an Academy award for his documentary, An Inconvenient Truth, won aGrammy for “Best Spoken Word Album,” and oh, by the way - won a NOBEL PEACEPRIZE IN 2007! He flies around the country to convey the urgency of the problem toeveryone, yet he still lives in a 10,000 square foot mansion that consumes as much astwelve times the amount of energy of the average household in Tennessee! Eventually Mr.Gore was called to the mat on his liberal use of energy, so he put in solar panels, new win-dows, and changed his light bulbs. Unfortunately, he still consumes up to ten times theamount of energy as an average Nashville home. So what’s the problem here? Al’s great attalking the talk, just not walking the walk.

That’s the trend I am seeing in the “community banks” that I’m visiting. Regardless ofwhat they say on their website or advertising material about being “customer first” and“only partnering with exceptional products and services,” what I really find out when I walkin is an inconvenient truth – it’s all about price. It really doesn’t matter to them what I haveto offer in terms of exceptional accuracy, integrity, and service for their borrowers. It’salways price. Even after I prove to them the problems and inaccuracy of their current vendor

Michael W. HinesBusiness DevelopmentManagerFloodplain ConsultantsInc.

WalkWalkTHE



(sometimes with a 30 percent error rate),if I can’t beat the current price of theirvendor, they won’t move - even if it is thebest thing for their borrower. I’ve evenbeen told, “I don’t care if it’s wrong orright, it’s the customer’s problem to dealwith.” This is coming from someone whosays that they are a “community bank.”

So, what makes a true communitybank? Is it asset size? The FDIC’s defini-tion of a community bank is “a bank withassets, or deposits, of $1 billion or less.”However, when interviewing both commu-nity bankers and their customers, I got adifferent answer. Upon discussion, it seemsthat it is not necessarily the asset size, butthe level of service that distinguishes acommunity bank from the big bank acrossthe street. Linda Boiman of North SideBank & Trust in Cincinnati defined a com-munity bank as “a bank that truly identifieswith the people and the needs of the com-munity which it serves by providing serviceand immediate attention.” Jackie Simmonsof Farmer Savings Bank in Spencer toldme it’s “a place where customer can walkin and say, “Hey...how’s the family?” tothe president.”

Well, if a community bank’s focus isreally on providing a higher level of serv-ice, how does it influence their decisionwhen it comes to choosing vendors? Myclients tell me that “just like them, theywant a vendor who knows the area and isbetter able to service it.” I was also toldthat, “a community bank is only as good asthe vendors and outside services that itemploys.” So what does that say about thebanks that only choose their services basedon price?

Right now there is a movement calledmoveyourmoney.info. It’s a grassrootseffort that’s main goal is to shift the powerin the financial system away from WallStreet, and back to Main Street. Helpinginfluence people to move their money outof “too big to fail” banks and into smaller,community-oriented financial institutions.

On the site you can find community banksin your neighborhood, and move yourmoney to an institution that knowsyour community, wants your business,and will offer better customer service. Butwill they? Or is that just what theirwebsite says?

I ask this because a large portion of theOBL is made up of community banks -Banks that I visit every day - Banks thatbolster values and president’s messages of“community first!” - Banks that tell me, “Idon’t care about the borrower, I wantsomething cheaper.”

When it comes down to the peckingorder of your values, what is first? Is it“people,” “integrity,” or maybe “profit?” Iknow what your website says, but what is itreally? Geoff Colvin of Fortune Magazinesaid it well, “Your words alone mean noth-ing. Your actions – and only your actions –speak. All successful leaders understand it,while failed leaders don’t.”

So, you say you’re a community bank?Well then…..walk the walk.Floodplain Consultants Inc. is an endorsed businesspartner with the Ohio Bankers League. We give dis-counts to OBL members, give back to the OBL, andare in your community every week. We know yourborrowers by name, and go to bat for them everyday. At Floodplain Consultants Inc. we believe thatyou and your borrowers deserve more than just apiece of paper, and only work with local communitybanks. We were founded in 1991 out of the beliefthat banks and borrowers deserve more in the levelof accuracy and service than is being given. We’veseen the other flood companies being bought andsold, streamlined, and incorporated into giant soft-ware systems - all the while, losing their accuracy,service, and dependability. We are approached on amonthly basis by firms in India that want to “help”us with our efficiency, cut our costs, and boost ourprofits. However, in doing so, we would lose all ofthe values that our company was founded on. So wechoose to stay regional, and provide you and yourborrowers with the highest level of accuracy andservice available – so that we may “Walk the Walk.”


OHIO BANKERSBENEFITS TRUST Working for Banks and Bankers

It’s all about choice.We’re flexible – You decide.In today’s competitive marketplace, benefits have become asimportant as compensation when hiring or retaining the bestand brightest employees. That’s why we believe it’s importantfor you to have as much input as possible when it comes todesigning your bank’s employee benefits program. With theOhio Bankers Benefits Trust, you can pick and choose one,all, or a combination of plans you want to offer youremployees and determine how you want to allocate premiumcontributions. Plan options mean greater cost control.

For more information about the OBL health plan options contact:Gary Sutter at 614-340-7615 or [email protected]


Eagles Club ($500 or more)Michael Baker, OBL BankServices

Howard Boyle II, Home Savings Bank

Steven Hunter, The Vinton County National Bank

John Kozak, The Park National Bank

Robert Lameier, Miami Savings Bank

Timothy Lehman, The Park National Bank

Mark Milligan, First Federal Savings and Loan Association

Daniel Schutt, The Union Bank Company

Trent Troyer, First Federal Community Bank

Michael Van Buskirk, Ohio Bankers League

Benedict Weissenrieder, The Hocking Valley Bank

Stephen Wilson, LCNB National Bank

Brian Young, The Union Bank Company

Ambassadors Club ($300 - $499)Michael Adelman, Ohio Bankers League

Mark Allio, CFBank

Joseph Bunke, Cincinnati Federal Savings and Loan Association

Coleman Clougherty, Farmers Citizens Bank

C. Daniel DeLawder, The Park National Bank

Ms. Lynn Fawcett, The Park National Bank

Steve Foster, LCNB National Bank

Blair Hillyer, The First National Bank of Dennison

John Kidd, Wesbanco Bank, Inc.

Robert Kirkbride, Wesbanco Bank, Inc.

D. Bruce Knox, Wesbanco Bank, Inc.

Ms. Laura Lewis, The Park National Bank

John Malanowski, First Federal Savings and Loan Assoc. of Lorain

Michael Melvin, Perpetual Federal Savings Bank

Thomas Moore, First Federal Bank of Ohio

Larry Morrison, Farmers Citizens Bank

Michael Pell, First State Bank

Thomas Pulfer, United Midwest Savings Bank

Jeff Quayle, Ohio Bankers League

Ms. Deborah Schenk, The Mechanics Savings Bank

Henry Schulhoff, Wesbanco Bank, Inc.

Jeffrey Smith, The Ohio Valley Bank Company

Robert Smith, American Savings Bank, FSB

Mark Snider, The Hocking Valley Bank

Neil Strawser, Wesbanco Bank, Inc.

Ms. Mary Sullivan, The Franklin Savings and Loan Company

Gary Sutter, Ohio Bankers League

Roger Williams, The Ohio Valley Bank Company

Rev. Barry Windholtz, The Franklin Savings and Loan Company

Gordon Yance, First-Knox National Bank

The continued success of our Political Action Committee reflects our industry’scommitment to a strong government relations program that in turn promotes a thrivingand competitive banking system for Ohio. In 2009, the Ohio banking communitypulled together to raise $97,000.We would like to thank our PAC Board of Directors, led by Trent B. Troyer,

president & chief operating officer at First Federal Community Bank in Dover, for theeffort and time commitment they put in during 2009. The primary reason for our continued success however goes to each of our contributors, so we would like to recognize below those bankers that have contributed more than $100. For moreinformation about how you or your institution can get involved in Ohio BankPac, please contact OBL Government Relations Specialist Dan Conklin at (614) 340-7607 or [email protected].

Ohio BankPac in 2009Making a DifferenceBy Jeffrey D. Quayle, Senior Vice President & General Counsel



Sustaining Member ($175 - $299)Ms. Mary Abel, The Hocking Valley Bank

Jeffrey Benton, The Delaware County Bank and Trust Company

Roger Blair, First Community Bank

Ms. Sherran Blair, First Community Bank

Mark Breitinger, Richland Bank-A Division of PNB

Richard Brinkman Jr., First Federal Community Bank

Michael Brooks, The Hocking Valley Bank

Mrs. Maureen Buchwald, First-Knox National Bank

Terry Bumpus, First Federal Savings & Loan Assoc. of Centerburg

Brady Burt, The Park National Bank

Thomas Button, The Park National Bank

William Carr, Liberty National Bank

Steven Chapman, The Ohio Valley Bank Company

Ronald Collins, The Vinton County National Bank

Michael Cone, Home Savings Bank

Robert Daniel, The Ohio Valley Bank Company

Robert Duncan, First Federal Savings and Loan Association

Ronald Eschbach, The Antwerp Exchange Bank Company

David Folkwein, The Delaware County Bank and Trust Company

William Fralick, Security National Bank - A Division of PNB

Robert Gall, The Hocking Valley Bank

Alan Geiger, The Hocking Valley Bank

Harold Howe, The Ohio Valley Bank Company

Peter Jaworski, Wesbanco Bank, Inc.

Ms. Lynne Karla, The Park National Bank

Todd Mason, The First National Bank of Pandora

Ms. Carol Michaels, Richland Bank-A Division of PNB

Ms. Shirley Monica, Richland Bank-A Division of PNB

Robert Montagnese, First Federal Savings and Loan Association

Kevin Motley, The Wilmington Savings Bank

Terry Myers, The Park National Bank

Scott Nisley, The Hocking Valley Bank

John Nolting, The Franklin Savings and Loan Company

Robert Norris, The Hocking Valley Bank

Earl Osborne, Guardian Finance Company

Michael Putman, The Hocking Valley Bank

Paul Reed, Farmers Bank and Savings Company

Richard Riesbeck, The Citizens Savings Bank

Joseph Risch, The Vinton County National Bank

David Roach, The Union Bank Company

Brent Saunders, The Ohio Valley Bank Company

Ms. Marilyn Sessions, Home Savings Bank

Ronald Shidaker, The Wilmington Savings Bank

Paul Siebenmorgen, The Farmers & Merchants State Bank

Thomas Siemers, The Franklin Savings and Loan Company

Scott Stiegemeier, Home Savings Bank

Roger Stitzlein, First-Knox National Bank

Donald Stone, United Bank - A Division of PNB

David Thomas, The Ohio Valley Bank Company

Paul Thompson, First Federal Savings and Loan Association

James Vincent, The Ottoville Bank Company

Mrs. Sarah Wallace, First Federal Savings and Loan Association

Thomas Will, Community Bancshares, Inc.

Mark Williams, The Wilmington Savings Bank

Charles Wingett, The Hocking Valley Bank

Thomas Wiseman, The Ohio Valley Bank Company

Supporting Member ($100 - $174)Ronald Adams, Richland Bank-A Division of PNB

Gregory Agresta, Wesbanco Bank, Inc.

Douglas Ahlers, Versailles Savings and Loan Company

John Allen Esq., The Community Bank - A Division of CSB

Michael Allen, The Croghan Colonial Bank

Harrold Anness, Cincinnati Federal Savings and Loan Association

Dr. Stuart Anness M.D., Cincinnati Federal Savings and Loan Association

Ms. Patricia Arnett, Liberty National Bank

Ms. Tyeis Baker-Baumann, Second National Bank - A Division of PNB

Joseph Barker, The Antwerp Exchange Bank Company

David Beckett, LCNB National Bank

Robert Bedinghaus, Cincinnati Federal Savings and Loan Association

Robert Benroth, The Union Bank Company

Brian Bialik, Home Savings Bank

Ms. Tammy Bobo, The Hocking Valley Bank

Dr. Steven Bohl, Perpetual Federal Savings Bank

Herman Borkoski, The Citizens Savings Bank

Jerry Borton, The Farmers & Merchants State Bank

Carl Bowman, Monroe Federal Savings and Loan Assoc.

Robert Brosky, First Federal Savings and Loan Assoc. of Lorain

John Brown, Unity National Bank - A Division of SNB

William Burke, American Savings Bank, FSB

Mrs. Patrica Byerly, The Farmers & Savings Bank - A Division of PNB

James Caldwell CPA, The Vinton County National Bank

Jerry Caldwell, Benchmark Bank

Peter Cassanos, The Park National Bank

Michael Chambers, Richland Bank-A Division of PNB

Ms. Margaret Chapman, Security National Bank - A Division of PNB

Gary Clay, Van Wert Federal Savings Bank

Stephen Clinton, First Federal Community Bank

Martin Cole, The Andover Bank

Steven Coutts, The First National Bank of Dennison

Donald Covert Sr., First Federal Bank of Ohio

Timothy Cowen, The Farmers & Savings Bank - A Division of PNB

Ms. Lori Cramer, The Vinton County National Bank

Ms. Cynthia Crane, The Park National Bank

Spencer Cropper, LCNB National Bank

Michael Cross, First Federal Savings and Loan Assoc. of Van Wert

Ms. Ester Crownover, The Vinton County National Bank

Wayne Deschambeau, Second National Bank - A Division of PNB

Neil Diller, Second National Bank - A Division of PNB

Robert Dillhoff, The Union Bank Company

Charles Dolezal, North Valley Bank

David Dostal, Farmers Citizens Bank

James Downhower, The First National Bank of Pandora

Kevin Drees, Versailles Savings and Loan Company

David Dygert, Farmers Citizens Bank

Charles Earick, Citizens Federal S&L Assoc. of Bellefontaine

William Edwards, Perpetual Federal Savings Bank

Richard Ekin, First Federal Bank of Ohio

Thomas Elder, The Croghan Colonial Bank

Dr. M. Boyd Epperson, First Federal Bank of Ohio

Scott Everson, The Citizens Savings Bank

Dr. Leon Favede, The Citizens Savings Bank

Richard Finan, The Franklin Savings and Loan Company

Scott Finnell, First Federal Community Bank

Mark Fleck, Mercer Savings Bank

Ms. Joan Franks, The Park National Bank

Steven Futrell, The Croghan Colonial Bank

Michael Gampp, American Savings Bank, FSB

Ms. Carolyn Garner, Wesbanco Bank, Inc.

William Garrett Jr., The Vinton County National Bank

Terry George, First Community Bank


Eric Geyer, First Federal Bank of Ohio

Ms. Vicky Gilbert, The Union Bank Company

Ms. Mary Goddard, Security National Bank - A Division of PNB

David Gooch, Richland Bank-A Division of PNB

Thomas Goodfellow, Security National Bank - A Division of PNB

Theodore Graham, The Ohio State Bank

Todd Graham, The Farmers & Merchants State Bank

J. Richard Gray, First Federal Community Bank

Scott Green, The Park National Bank

James Greenfield, The Andover Bank

Randall Greenwood, The Citizens Savings Bank

Danny Grooms, Ripley Federal Savings Bank

Leonard Gundy, First Federal Community Bank

Donald Harris Jr., Richland Bank-A Division of PNB

John Hatcher, Citizens Federal S&L Assoc. of Bellefontaine

Steven Hausfeld, Cheviot Savings Bank

Ronald Hawk, First-Knox National Bank

Jesse Henson, Perpetual Federal Savings Bank

John Herzig, The Citizens Savings Bank

Gary Hewitt, The Andover Bank

Jeffrey Hittle, Second National Bank - A Division of PNB

John Hofmann, Citizens Federal S&L Assoc. of Bellefontaine

Mark Honigford, The Union Bank Company

John Hoopingarner, The Citizens Savings Bank

R. Duane Hord, Farmers Citizens Bank

Ms. Teresa Hoyt PHR,Security National Bank - A Division of PNB

Daniel Hunt, The Park National Bank

Andrew Irick, Security National Bank - A Division of PNB

John Irmscher, Mercer Savings Bank

Gerald Jenkins, American Savings Bank, FSB

Wesley Jetter, Second National Bank - A Division of PNB

Samuel Jones, The Citizens Savings Bank

Thomas Karr, Farmers Bank and Savings Company

David Kaufman, First Federal Community Bank

Ms. Linda Kay, Wesbanco Bank, Inc.

Timothy Kelley, The Citizens Savings Bank

Ms. Candy Kemmerer, The Hocking Valley Bank

Jeffrey Kessler, Benchmark Bank

Garry Kleer, Mutual Federal Savings Bank, A FSB

Thomas Knapke, Mercer Savings Bank

Bradley Kopf, Cincinnati Federal Savings and Loan Association

Richard Kotila, The Andover Bank

Thomas Krick, Mercer Savings Bank

Thomas Lammers Esq., Mercer Savings Bank

Michael Lamping Sr., The Ohio State Bank

Daniel Lease, The Croghan Colonial Bank

George Leasure, LCNB National Bank

Elmer Leeper, The Citizens Savings Bank

Edward Leininger, The Farmers & Merchants State Bank

W. Douglas Leonard, First-Knox National Bank

William Levering Sr., First-Knox National Bank

Michael Lewis, Home Savings Bank

James Lingenfelter, The Farmers & Savings Bank - A Division of PNB

Thomas Linneman, Cheviot Savings Bank

Michael Lloyd, The Citizens Savings Bank

Enos Loader, First Federal Community Bank

Max Long, The Union Bank Company

Christopher Lute, American Savings Bank, FSB

Lindley Mann, Mutual Federal Savings Bank, A FSB

Bryan Marshall, Liberty National Bank

Thurman Mathews, The Ohio State Bank

Carl Mayer, The Park National Bank

William McConnell, The Park National Bank

Ted McKinniss, The Ohio State Bank

Ronald McNeely, The Union Bank Company

Ms. Diarmuid McSweeney, First Federal Savings and Loan Association

James Meagle Jr., The Settlers Bank

Larry Meredith, American Savings Bank, FSB

Ms. Lori Michael, Wesbanco Bank, Inc.

Harold Migias, Wesbanco Bank, Inc.

Ms. Lydia Miller, The Park National Bank

Matthew Miller, The Park National Bank

Grant Milliron, Richland Bank-A Division of PNB

Ms. Suzanne Moeller, Wesbanco Bank, Inc.

Bill Moore, The Community Bank - A Division of CSB

Richard Morgan, American Savings Bank, FSB

Larry Mosher, The First National Bank of Dennison

Richard Mosier CPA, Mercer Savings Bank

Richard Mountain, Liberty Federal Savings Bank

Dennis Muzilla, First Federal Savings and Loan Assoc. of Lorain

Hobert Neiswander, Perpetual Federal Savings Bank

Andew Nurre, Cincinnati Federal Savings and Loan Association

Fred O'Dell, North Valley Bank

Ms. Joaanna Pagnanelli, Wesbanco Bank, Inc.

Kenneth Parr Jr., United Bank - A Division of PNB

Noel Parrish, First-Knox National Bank

Ms. Patricia Partch, LCNB National Bank

Jeffrey Parton, Richland Bank-A Division of PNB

Gary Pendleton, The Ohio State Bank

William Perry, The Union Bank Company

Andrew Phillips, The Citizens Savings Bank

Jeffrey Point, The Union Bank Company

Ms. Kathleen Porter Stolle, LCNB National Bank

Douglas Postler, Bramble Savings Bank

Peter Rafaniello, The Union Bank Company

Mark Ramser, First-Knox National Bank

James Ransbottom, North Valley Bank

Theodore Reed, Farmers Bank and Savings Company

Lewis Renollet, The Union Bank Company

James Reynolds, The Union Bank Company

Dr. Robin Rhodes M.D., The Citizens Savings Bank

Ms. Karen Rice, The Park National Bank

Harold Rigel, The Union Bank Company

Barry Ritchey, Standing Stone National Bank

Ronald Roth, Cincinnati Federal Savings and Loan Association

Keith Rothe, First Community Bank

Tom Ruetenik, Security National Bank - A Division of PNB

Errol Sambuco, The Citizens Savings Bank

Ms. Vickie Sant, First-Knox National Bank

Ms. Stacy Schindler, Ohio Bankers League

Oliver Schneider Jr., Home Savings Bank

Norman Schnipke, The Union Bank Company

John Schuler, Cincinnati Federal Savings and Loan Association

Robert Schulte, The Union Bank Company

Philip Schumann, Mercer Savings Bank

Joseph Schwarz, LCNB National Bank

Carmen Scott, Citizens Federal S&L Assoc. of Bellefontaine

Robert Sensel, First Federal Community Bank

R. Michael Shannon, The Park National Bank

Larry Shreffler, The Mechanics Savings Bank

John Smith, Cheviot Savings Bank

Ms. Linda Smith, Richland Bank-A Division of PNB

R. Daniel Snyder, First-Knox National Bank

Robert Springer, The Park National Bank

Marvin Stammen, Second National Bank - A Division of PNB

Michael Steen, The Community Bank - A Division of CSB

Jack Stephenson, American Savings Bank, FSB

Michael Stewart, Liberty Federal Savings Bank

C. Edward Stocksdale, Perpetual Federal Savings Bank

Ms. Kathleen Stolle Porter, LCNB National Bank

Ms. Julie Strohacker, The Park National Bank

Jeff Swaim, The Hocking Valley Bank


John Swallow, Second National Bank - A Division of PNB

Craig Sweeney, The Hocking Valley Bank

Charles Sweeting, Perpetual Federal Savings Bank

Rick Taylor, Richland Bank-A Division of PNB

Robert Taylor, The Andover Bank

J. Douglas Temple, Mercer Savings Bank

Martin Terry, The First National Bank of Pandora

Matthew Thomas, The Citizens Savings Bank

Lowell Thurston, The Ohio State Bank

David Trautman, Park National Corporation

Chris Tuttle, The Farmers & Savings Bank - A Division of PNB

Stan Uchida, The Park National Bank

John Uible, The Park National Bank

Jeffrey Urban, First Federal Community Bank of Bucyrus

Joseph Valore, Perpetual Federal Savings Bank

Stephen Varckette, The Andover Bank

Ms. Melea Wachtman, Ohio Bankers League

Charles Walker, First Federal Bank of Ohio

Michael Warnecke, Security National Bank - A Division of PNB

David Weber, Farmers Bank and Savings Company

Thomas Weithman, First Federal Bank of Ohio

Vernon Westbay, Citizens Federal S&L Assoc. of Bellefontaine

John Whitacre Jr., The Bank of Magnolia Company

Fred White, The Ohio State Bank

William Whitmoyer, Wesbanco Bank, Inc.

Ms. Barbara Wilson, The Park National Bank

Douglas Wilson, United Bank - A Division of PNB

Jeffrey Wilson, The Park National Bank

Ms. Lisa Wiswasser, The Union Bank Company

Bernard Wright Jr., LCNB National Bank

Ms. Terri Wyatt, Security National Bank - A Division of PNB

Russel Yenser, The Antwerp Exchange Bank Company

Ms. Susan Zimmer, Liberty National Bank

Ronald Zimmerly, Liberty National Bank

Michael Adelman, Ohio Bankers League

Barbara Benham, The Huntington National Bank

Jason Buckley, ATM Solutions, Inc.

Jack Casey, Elan Financial Services

Coleman Clougherty, The Farmers Citizens Bank

James Coe, First Federal Savings and Loan Association

J. Michelle Crume, OBL BankServices

James DeRoberts, Gardiner Allen DeRoberts

Philip Evans, Kingston National Bank

Calvin Gebhart, The Citizens Bank of Ashville, Ohio

Katie Gordon, Gardiner Allen DeRoberts

G. Courtney Haning, The Peoples National Bank of New Lexington

Chip Harper, ATM Solutions, Inc.

Blair Hillyer, The First National Bank of Dennison

Michael Hines, Floodplain Consultants, Inc.

Mark Johnson, The First Citizens National Bank of Upper Sandusky

Kurt Kratzer, RDSI Banking Systems, Inc.

John Limbert, The National Bank and Trust Company

Larry Lindamood, The Peoples National Bank of New Lexington

Edward McKeon, Western Reserve Bank

Michael Melvin, Perpetual Federal Savings Bank

Dean Miller, The First National Bank of Bellevue

Thomas Moore, First Federal Bank of Ohio

Samuel Munafo, First Financial Bank, National Association

Lawrence Nash, The Peoples National Bank of New Lexington

R. Douglas Naylor, The First National Bank of Blanchester

Jeffrey Quayle, Ohio Bankers League

Jon Park, Westfield Bank

Paul Reed, Farmers Bank and Savings Company

Paul Reynolds, Fifth Third Bank

Barry Ritchey, Standing Stone National Bank

Deborah Schenk, The Mechanics Savings Bank

Gretchen Schmidt, The Franklin Savings and Loan Company

Jeffery Smith, Bricker & Eckler, LLP

Michael Stewart, Liberty Federal Savings Bank

David Summers, Monroe Federal Savings and Loan Assoc.

J. Douglas Temple, Mercer Savings Bank

David Trautman, The Park National Bank

Trent Troyer, First Federal Community Bank

Michael Van Buskirk, Ohio Bankers League

Melea Wachtman, Ohio Bankers League

William Wendt, The Henry County Bank

Thomas Will, The Vinton County National Bank

Uma Zielinski, Deluxe Financial Service, Inc.

Ronald Zimmerly, Liberty National Bank

…And a Special Thanks to our BankPac Silent Auction Contributors

To reach over 4,000 key banking decision-makers contact James Thurston at (614) 340-7621 or [email protected].

Are you looking for that Spark?Creative print is more than just ink on paperIt’s about gaining Attention for your businessIt’s about stimulating Interest in your productsIt’s about creating Desire for your servicesThat’s where Ohio Record comes in


Have an interesting story totell, recent promotions, inno-vative program or other bankannouncements? If it’s newsyou think we need to know…tell us about it. We’re interestedin keeping up to date on theactivities of our members. Pleaseput the OBL CommunicationsDepartment on your mediamail or e-mail lists. Send yournews to:

James Thurston Editor, Ohio Record,

[email protected], 4249 Easton Way, Suite 150,Columbus, OH 43219-6170.

Tell Us About It

Individually, a bank might spend up to $5,000 for a Compliance Coach mem-bership - but with the collective power of the OBL - this nationally-known onlinecompliance training continues to be available at no cost to member banks. Themore than 100 OBL member banks that are also Compliance Coach clients have access to 35 FREE interactive online compliance courses 24/7 in high risk areas- 11 of which are approved for CRCM credits, including: RESPA: HUD-1/1A;Currency Transaction Reporting; and HMDA: Reporting and Disclosure. “We were very satisfied with the Compliance Coach training programs we uti-

lized last year and we will continue to use the product in the future,” said LisaEadler, operations officer, Greenville National Bank. “We found the program avaluable tool, as we were able to customize annual training specific to employeejobs and responsibilities and document results to follow up with any additionaltraining that was needed.”The OBL introduced this program to its members as a benefit in January

2009 and is pleased to continue this no-fee program in 2010. If your bank is notalready registered, visit the OBL Web site for more details or contact JulieKiplinger at 614-340-7612.

NO COST ONLINE COMPLIANCETRAINING STILL AVAILABLE IN 2010



CLEVELAND Forty Ohio banks that purchase D&O

and fidelity bond insurance from OBLbusiness partner the ABA InsuranceProgram will share $87,602 in profit distributions this year from the program’sreinsurer, American Bankers MutualInsurance Ltd. This is the program’s 20thconsecutive profit-sharing distribution—$71,500,000 has been declared since thefirst distribution in 1991 based on themutual program’s success and profitability.The total distributed to Ohio banks is over$1,900,000. Participating banks nationwidewill receive checks this year ranging up to $50,000 with $3,900 being the average amount.

The Federal Reserve Bank of Clevelandannounced Dale Roskom has been appoint-ed vice president and chief operating officer.

COLUMBUSOBL affiliate member

Bricker & Eckler LLPannounced the electionof Kurtis Tunnell to man-aging partner. Tunnellsucceeds Richard C.Simpson, who served inthe same position from2000 to 2010.

Huntington Bank announced that DavidClifton has joined as executive vice presi-dent, chief customer and marketing officer.

Carol Mount Peterson, the long-timechair of OBL business partner the OhioCapital Corporation for Housing’s board ofdirectors, passed away recently. MountPeterson had been on the OCCH Boardsince 1993 and became chair in 1998. Inaddition to her leadership at OCCH, sheserved as senior vice president and directorof housing and community development at the Federal Home Loan Bank ofCincinnati, where she served for 36 years.

DEFIANCERurban Financial Corp. announced that

the appointment of Anthony Cosentino asexecutive vice president.

GRANVILLEOBL affiliate member Dixon, Davis,

Bagent & Company announced that BrianA. Snow, consultant recently completedthe BSA/AML Institute, a professionalcertification program, sponsored by the Independent Community Bankers of America.

GREENVILLEGreenville Federal

announced the appoint-ment of Jeff D. Kniese toCEO. Kniese replacesoutgoing CEO DavidKepler, who recentlyretired.

MANSFIELDJim Courtney, former president of The

Mechanics Savings Bank, passed awayrecently. Courtney was named president ofthe bank in 1988 and previously served assenior operating officer. He retired in 2003.

MARIETTASettlers Bank announced the election

of Donn Schafer, chief financial officer andexecutive vice president,to its board of directors.Schafer is a graduate ofMarietta Senior HighSchool and the OhioState University with aB.S. degree in Finance.

PORTSMOUTHAmerican National

Bank has promotedMichael Gampp to execu-tive vice president.Gampp has been with thebank since 2000 and hisrole as CFO will beexpanded to assist presi-dent and CEO Bob Smith in the overalladministration of the company.

NEWARKThe First Federal Savings & Loan Assoc.

of Newark announced the promotions ofJennie Jo Hall and Lindsay Englefield tovice president.

WESTFIELD CENTERWestfield Bank has earned a top five-star

“Superior” rating from BauerFinancial, anindependent rating company analyzingand reporting on the performance of U.S. banks and credit unions since 1983. Westfield Bank has now been recommended by BauerFinancial for 28consecutive quarters.

WILMINGTONNB&T Financial Group, Inc.

announced that is has acquired, throughits subsidiary, The National Bank andTrust Company, the banking operations ofAmerican National Bank, the subsidiarybank of American National Bancorp,through a purchase and assumption agreement with the Federal DepositInsurance Corporation.

YOUNGSTOWNThe Home Savings and Loan Company,

a subsidiary of United CommunityFinancial Corp. announced the promo-tions of Nick Berardino and Patrice L.Burkle to vice presidents, commerciallending. Their primary responsibilitiesinclude managing their respective com-mercial loan portfolios while seeking outnew business opportuni-ties through referrals,centers of influence andexisting client expansion.Kevin P. Gluntz wasnamed vice president anddeputy general counsel.

Kurtis Tunnell

Jeff D. Kniese

Donn Schafer

Michael Gampp

Kevin P. Gluntz

Ohio Record: Tell us a little bit about yourself. How didyou become a banker?

Iverson: I actually graduated with a marketing degreebut had a cooperative work/education experience with abank – that’s what started the whole banking thing forme. After getting to know professionals in the field, I’veprogressed from there.

Ohio Record: What are the league’s big plans for 2010?

Iverson: For 2010, the Tri-State League will continue tolook for and provide training opportunities in areas suchas compliance, operations, lending and any other hottopics that may arise throughout the year. We providediscussions and seminars on each of these topics. The objectives of the league are to fos-ter and encourage the financial institutions industry in Southwestern Ohio, NorthernKentucky and Southeastern Indiana through the exchange of ideas and practices gainedfrom mutual discussion and study, to cooperate with other financial institutions in thepromotion of the industry, to publicize its services and those of its members, and to doany and all things necessary to the accomplishment of these purposes.

Ohio Record: How did you first become involved with the Tri-State League?

Iverson: I became involved with the Tri-State League through my ability to producemarketing materials. I had worked with some of the social committee chairs who askedif I would produce the flyers for their socials… and it grew from there! Next thing youknow, after a couple years of producing the flyers, I became more involved in the socialactivities and was then asked to be a board member for the Tri State League. It’s beengreat and fun – I wouldn’t trade it!


For many years, the OBL has awardedscholarships to the Graduate School ofBanking in Madison through the BlytheSchool of Banking (now known as theOBL Bank Management School) and theBank Leadership Institute Program. Forthe first time, the OBL also awarded a2010 GSB Scholarship to a generalemployee of an OBL member bank. As abonus, all applicants received a $350application refund to the school.

The OBL has named Delmar C.Schiferl, vice president & chief lendingofficer with Miami Savings Bank inMiamitown, OH, the recipient of theProchnow Educational Foundation/OhioBankers League Scholarship. He will

receive a $1,250 discount from the regu-larly charged fees for each of the threeyears of the Graduate School of Bankingat the University of Wisconsin-Madison(Aug. 8 – 20).

The Graduate School of Banking’sHuman Resource Management SchoolScholarship was awarded to Heather A.Brayshaw, HR director & banking officerwith First-Knox National Bank in MountVernon, OH. She will receive an $800discount from the regularly charged feesfor the GSB HR Management School atthe University of Wisconsin-Madison(Aug. 8 – 13).

“The banking industry and the com-munities we serve have a bright future

because of the leadership of bankers suchas Del and Heather,” said StacySchindler, OBL manager of professionalschools and conferences. “We are thrilledthey both have the opportunity to fur-ther their education and their careers,while helping their banks save valuabletraining dollars.”

Established and funded by theHerbert V. Prochnow EducationalFoundation, the scholarships, madeavailable annually to selected individualswho demonstrate outstanding leadershipand a commitment to his or her commu-nity and to the banking industry, furthersthe goal of supporting banker education.

Focus On…GSB Scholarships Awarded to Ohio Bankers

Tri-State League of Financial Institutions

Annie Iverson

One of the OBL’s fellow Ohio bank-ing trade associations is the Tri-StateLeague of Financial Institutions. Theleague, which recently celebrated itsfiftieth birthday, was formed in 1960 asa result of a merger between GreaterCincinnati Savings and Loan Exchangeand the Greater Hamilton CountySavings and Loan League. The leagueand its predecessors have been in existence since 1868. Ohio Recordrecently discussed the league’s plans for2010 with current President AnnieIverson, marketing director at CheviotSavings Bank.

CONTACT DAN CONKLIN AT (614) 340-7607 TO FIND OUT MORE.

Tuesday, May 11

OBL Day

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Documents

Ohio Bankers League Spring 2010 Magazine