The Missouri Bankers Association (MBA) held their 130th Annual Convention virtually this year; it was done well. We’ve attended this conference a number of times in the past to meet current and prospective clients, and to hear good speakers/industry experts talk about what’s going on in the industry. As the conference was virtual, we didn’t get the opportunity to visit with many of you in person. So… we wanted to share some of our takeaways.
First of all, we congratulate the MBA for a well-otherganized virtual event held over two half-days that integrated good technology with great speakers. All of the early invitations and solicitations contained links to test your connectivity and ability to appreciate the conference. I used those tests and it came in handy. I imagine many others did as well. The conference started on time each day and wrapped up at the predetermined time. While there were none of the amenities (friends, food, and fun) that we’ve come to enjoy at this event, the speakers were top notch. Outgoing and incoming association chairmen, Anne Viera and Brice Luetkemeyer opened our days. Then, just as planned, the presentations occurred. No connectivity issues – no time wasted.
Speakers on the first day included Chris Kuehl, an economist / business intelligence guru; Rob Barrett, the Commissioner of Missouri Division of Finance and a former banker; and Paul Godfrey, a professor of business from BYU.
Speakers on the second day included Jelena McWilliams, Chairman of the FDIC and a former banker; Rob Nichols, President and CEO of the ABA; and Allan Lichtman, professor of business history from American University in Washington DC. All in all, a solid lineup.
Facts that I found interesting (and I hope you do too!)
- Banks have found themselves with the roles of comforter, counselor, and lender for their customers during the last 90 days. More so than ever.
- If managed well, bank employees working from home have become increasingly productive. But it’s hard to train new employees in the “work from home” environment. And not all banks have or want the technology it takes to work remotely.
- We’d like to see a “V” shaped economic recovery from this pandemic, however its most likely to be an elongated “U”, as businesses and governments have to balance health versus economic concerns. Any health setbacks stretch the recovery curve while progress in managing COVID and its effects shortens the curve.
- Loan concessions trigger TDR’s, while loan modifications generally offered to all borrowers do not. Both the FDIC and Missouri Division of Finance took the same position. And when in doubt, call your bank examiner. The ABA noted bankers should discuss loan workout plans with their examiners as well.
- Increased monitoring of these loan modifications is recommended – consider tracking by industry, loan concentrations to capital, etc.
- Section 4013 of the CARES Act states that banks won’t be criticized for good faith, prudent loan modifications.
- Examinations have begun and will take a more hybrid – on and offsite – approach, but most banks are ready and eager for this change.
- 60% of world container trade is stuck in ports. A potential result of the pandemic will be increased lending for inventory and warehouse capacity to avoid future shortages.
- Take time to debrief in management and Board meetings regarding the bank’s activities over the last 90-120 days. What actions were on target, not needed, or were missing? Then implement changes based on learnings.
- The CECL delay and the FDIC’s delay in supporting CRA reform were both based on the COVID realities, and the impact on community banks. The FDIC also temporarily placed a hold on signage regulations.
- ABA is advocating there shouldn’t be any retaliation against bankers for doing what they were asked to do; bankers were on the front lines of this pandemic and its impact on the economy.
- The presidency is still seriously “up for grabs” according to Professor Allan Lichtman, who developed and authored THE 13 KEYS TO THE WHITE HOUSE, based on 100 years of history and which has predicted seven of the last eight elections.
- Both the new FDIC Chairman and the incoming Comptroller of the Currency are forward thinkers. Take some time to familiarize yourself with them and their views and professional backgrounds.
Let’s hope we can meet in person next year.