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PAGE 2 - INDEPENDENT COMMUNITY BANKERS OF SOUTH DAKOTAPresident’s Message“It’s not fair,” we have all used itand have heard it often, especially asparents. So what is fair? What Ithink is fair is often not fair to theother side. This will never change.On the national level we hear muchabout raising taxes on the wealthyand giving to the less fortunate.Upstream residents will lobby hardto move water more quickly so theirproperty is not damaged when thereis excess water or more slowly whenin short supply. Our fine educators lobby for more moneyto educate our young people but must fight against thoseneeding roads and bridges. The list is endless and oftentime it’s not a fairness issue; rather, it’s a matter of priorities.We will always have differences of opinion followedby debate. In most cases it is healthy and creates anenvironment that fosters individual and corporate growth.That is what I keep telling my wife.We should never wish bad on our competition or lookfor ways for an unfair advantage via government mandatesand incentives; rather, we must look for ways to do the rightthing for the communities we serve. Should banks withassets over $10 billion be treated differently than bankswith assets of less than $10 billion? Or, should creditunions and Farm Credit Services have the same privilegesas community banks to serve their communities but at alesser cost due to tax exemptions and without the sameCRA and other regulatory scrutiny? Is that fair?I am proud to be a banker, as I’m sure you are. Banksare among the oldest businesses in American history andthe banking system is one of the oldest, largest and mostimportant of our industries. Most adult Americans dealwith banks on a fairly regular basis. That will not changeso it should be a priority that banks be treated fairly, as theyprovide an important service to most Americans.Banks are essential. They operate within a verysophisticated payment system which is necessary for aneconomy to operate. Banks are a financial intermediation,lending or investing money deposited with them. This is avery important function because it is the primary means bywhich generations of entrepreneurs built the Americaneconomy and will continue to do so. The banking systemshould be treated fairly so this tradition can continue, notfor the benefit of banks but for the continued well-being ofour country.Banking is inherently a risky business. History tells usthat the expanding banking system in the 1830’s, 1840’sand 1850’s suffered greatly due to financial instabilityresulting in many bank failures. Banking panics in 1873,1884, 1893 and 1907 were the prerequisite to the creationof the Federal Reserve System, a system that created currencyuniformity and the power to reduce interest ratefluctuations. Banking history should be viewed under afair light without prejudice.Banks are for profit and pay taxes on their earnings.When failure knocks on their door, the stockholders lose.Unfortunately bank regulations will not eliminate all bankfailures. Regulations should be fair by considering thedistinct difference between an independent communitybank and our counter parts, for which Dodd-Frank wasdesigned.As bankers, we should be proud of our industry andlobby hard for it to be preserved but also recognize thatoccasionally it needs to be fine-tuned. But let us neverforget our banking system has stood the test of time andhas been, and continues to be, an integral part of this greatcountry. And I cannot think of a better way to get thismessage out than to continue your support of ICBA.ICBA continues its efforts to educate law makers andothers of the importance of preserving and protecting ourbanking system. It has stood the test of time, changedwhen necessary and continues to provide for corporate andindividual financial growth. And core to the bankingsystem are the independent community banks that continueto serve their communities and markets, much like in 1784when the Bank of New York was founded.Lance KothPresidentLance Koth is the President of First Dakota National Bank,Mitchell Market and also the President of ICBSD. Lance canbe reached at 605-995-7901 or lkoth@firstdakota.com. A NEW KINDOF FIRMCliftonLarsonAllen offers somethingdifferent: exceptional capabilities, deepindustry experience, and singular clientservice—all for community banks like yours.Minneapolis612-376-4500
National Director’s ReportAs I begin this article I need to reflecton how great the winter weather hasbeen for all of us. Usually whenValentine’s Day comes around, I lookforward to warmer weather in the nearfuture. I certainly cannot complainabout the weather we have beenexperiencing so far. We can all bethankful for the savings each of us, ourcustomers, and our communities havesaved in just energy expenses alonethis past winter.Mid-February brings thoughts of attending the ICBANational Convention. This year Peg and I will be inNashville at the Gaylord Opryland Resort and ConventionCenter, March 10th through the 15th attending this year’sconvention. I always come away from the convention withrenewed enthusiasm. It is a good way to get some educationand new information concerning issues that affect ourindustry. If you haven’t made arrangements to attend andwould like to, there is still time to do so. For those bankersand guests who will be attending, I look forward tovisiting with you and seeing you at The ‘Great MidwestGet-Together’ on Monday evening March 12th in Nashville.One of the issues that will be discussed at theconvention and a top priority for ICBA is with the creditunions. ICBA Chairman Salvatore Marranca wrote in anAmerican Banker op-ed that credit unions have addedanother issue to their campaign for new authority that strayfrom their original mission. “As if their heavy-handed pushto expand into prohibited business lending wasn't enough,it now seems they are adding on another power grab toincrease their ability to raise supplemental capital andsupport investors,” Marranca wrote. He noted that a bill isexpected to be introduced in the House Financial ServicesCommittee that would alter credit unions’ long-standingstatutory capital-raising restrictions. This is in addition totheir aggressive efforts to expand their member-businesslendingauthority.In related news, ICBA community banks havecontinued to spearhead the campaign against legislation toexpand credit unions’ business-lending authority. GrandRapids State Bank President and CEO, Noah Wilcox andINDEPENDENT COMMUNITY BANKERS OF SOUTH DAKOTA - PAGE 3State Bank Northwest President, CEO and Chairman,Gregory Deckard have ensured bank-wide participation inICBA’s petition opposing the Small Business Lending andEnhancement Act of 2011 (H.R. 1418/S. 509). ICBAcontinues to encourage community bankers to sign thepetition and to contact their members of Congress inopposition to the legislation, which would increase thestatutory member-business-lending cap for credit unionsfrom 12.25 percent to 27.5 percent of total assets. To signthe petition you may do so by going tohttp://www.icba.org/MBLPetition/index.cfm.Another issue that is top on the priority list for ICBA isto make permanent an FDIC transaction accountguarantee that is scheduled to expire at the end of 2012.ICBA is working diligently to continue full FDIC coverageof non-interest-bearing transaction accounts beyond 2012.ICBA Executive Vice President for CongressionalRelations and Chief Economist, Paul Merski writes thatICBA strongly believes that letting the program expire risksabrupt dislocation and other unintended consequences forthe financial sector. He also called on community bankersto contact their members of Congress to support theextension of the deposit-insurance coverage.In addition to the above issues I would like to bringyour attention to ICBA’s 12-page reference guide to helpnavigate the various titles and provisions in the Dodd-FrankWall Street Reform and Consumer Protection Act. Thisguide was provided for download at icba.org. In case youmissed it, the color-coded guide distinguishes whichprovisions apply to community banks, and which do not, aswell as those that possibly affect them, depending on theimplementing regulations. A hard copy of the piece will bedistributed with the March 2012 issue of ICBAIndependent Banker magazine and in registration kits forthe 2012 ICBA National Convention and Techworld.As always, I look forward to visiting with you concerningissues that affect you and your bank. Do not hesitate togive me a call or email me.Dick BehlICBA Director for South DakotaDick Behl is the CEO/President of The Farmers & MerchantsState Bank, Scotland and is the ICBA Director for South Dakota.He can be reached at 605-583-2234 or dbehl@fmsbscotland.comWELCOME NEW MEMBERS!ICBSD is delighted to welcome the following new members:Bank Members◆ Farmers State Bank, Turton◆ First PREMIER Bank, Sioux Falls◆ First State Bank, WarnerAssociate Members◆ CoSentry, Sioux Falls◆ Banker’s Equipment Service, Inc., Burnsville, MN◆ Silverstone Group, Des Moines, IA◆ Action Professional Services, Sioux Falls◆ Dougherty & Company LLC, Minneapolis, MNMonte Troske, President of Farmers State Bank, Turton sharedhis reasoning for joining ICBSD, “We’ve been a member of ICBAfor 40 years, and we realized we needed to be involved instatewide issues through ICBSD.”Beth Davis, President of Dakota Resources added,“Banks,and the people who work in them, share our mission of stimulatingfinancial and human investment in South Dakota communities.We see ourselves as partners in making South Dakota’scommunities great places to live and work.”We look forward to having these new members join us at upcoming ICBSD events.Their contact information can be found on the ICBSD website.
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