ISSUE 2 2020 - nmbankers.com Files/New folder (2... · ISSUE 2 2020 PAGE 2President’s Message — Jason Wyatt Executive Vice President's Message — John W. Anderson PAGE 8 Washington

ISSUE 2 2020P

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E 2 President’s Message — Jason Wyatt

Executive Vice President's Message— John W. Anderson P

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E 8 Washington Update — Rob Nichols

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E16 Three Steps to Assess Customer Profitability Post-COVID-19 — Jay Kenney

Photo by Jim Renfrow

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Our MissionThe mission of the New Mexico Bankers Association (NMBA) is to serve member bank needs by acting as New Mexico banking’s representative to government, the public, and the industry; pro-viding resources, education and information to enhance the opportunities for success in banking; promoting unity within the industry on common issues; and seeking to improve the regulatory climate to the end that banks can profitably compete in the providing of financial and related products and services.

2020 NMBABoard of Directors

PresidentJason Wyatt

Western Commerce Bank212 North Canal Street

Carlsbad, NM 88220

President ElectLonnie Talbert

Southwest Capital Bank1410 Central Ave., SW

Albuquerque, NM 87104

Secretary/TreasurerRon Wiser

Bank of the SouthwestRoswell, NM 87202-1108

Immediate Past PresidentMichael Lowrimore

Bank of the West303 Roma Avenue, NW


Executive Vice PresidentJohn W. Anderson

New Mexico Bankers Association316 Osuna NW, Suite 502Albuquerque, NM 87107

Terms Expiring 2020Danny Beyhan

The Citizens Bank, FarmingtonP.O. Box 4140

Farmington, NM 87499

Aaron EmmertPioneer Bank, Roswell3000 N. Main StreetRoswell, NM 88201

Stan SluderEnterprise Bank and Trust

7445 Pan American Fwy NEAlbuquerque, NM 87109

Terms Expiring 2021Scott Czarniak

First National 18707300 Jefferson St., NE


David HockmuthWells Fargo Bank, NA

200 Lomas, NWAlbuquerque, NM 87102

Mark HornPinnacle Bank

107 W. Aztec Ave.Gallup, NM 87301

Terms Expiring 2022Ken Clayton

Western Bank, Artesia320 W. Texas

Artesia, NM 88210

Sheila MathewsFour Corners Community Bank

500 W. Main, Suite 101Farmington, NM 87401

Jay JenkinsCarlsbad National Bank

P.O. Box 1359Carlsbad, NM 88220

©2020 The New Mexico Bankers Association (NMBA) | The newsLINK Group, LLC. All rights reserved. The New Mexico Bankers Association Quarterly is published four times each year by The newsLINK Group, LLC for NMBA and is the official publication for this association. The information contained in this publication is intended to provide general information for review, consideration and education. The contents do not constitute legal advice and should not be relied on as such. If you need legal advice or assistance, it is strongly recommended that you contact an attorney as to your circumstances. The statements and opinions expressed in this publication are those of the individual authors and do not necessarily represent the views of the NMBA, its board of directors, or the publisher. Likewise, the appearance of advertisements within this publication does not constitute an endorsement or recommendation of any product or service advertised. The New Mexico Bankers Association Quarterly is a collective work, and as such, some articles are submitted by authors who are independent of NMBA. While the New Mexico Bankers Association Quarterly encourages a first-print policy, in cases where this is not possible, every effort has been made to comply with any known re-print guidelines or restrictions. Content may not be reproduced or reprinted without prior written permission. For further information, please contact the publisher at 855.747.4003.

2 PRESIDENT'S MESSAGE By Jason Wyatt, President, New Mexico Bankers Association President

4 EXECUTIVE VICE PRESIDENT’S MESSAGE By John W. Anderson, Executive Vice President, New Mexico Bankers Association

8 WASHINGTON UPDATE By Rob Nichols, President and CEO, American Bankers Association

10 HOW A CUSTOM CONSULTATIVE APPROACH TO MORTGAGE PORTFOLIO SOLUTIONS MAKES ALL THE DIFFERENCE By Allen Moss, VP Regional Business Development, Golden Eagle Insurance

12 THE CORONAVIRUS PANDEMIC: RUNNING AROUND IN CIRCLES LOOKING FOR AN ANSWER — OPINION By Mark Anderson, Legal and Legislative Assistant, New Mexico Bankers Association

16 THREE STEPS TO ASSESS CUSTOMER PROFITABILITY POST-COVID-19 By Jay Kenney, SVP, Regional Manager, PCBB

18 FORECLOSURE PROTECTION: WHERE ARE WE NOW? By Chris Bell, Compliance Alliance

20 5 WAYS YOUR FINANCIAL INSTITUTION CAN USE DIGITAL TOOLS TO CONNECT WITH CUSTOMERS DURING COVID-19 By John Reynolds, Vice President of Sales, Document Service, CSI

23 BANK NEWS

24 BANKERS ON THE MOVE

Issue 2 • 2020

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O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S — H E L P I N G N E W M E X I C O R E A L I Z E D R E A M S

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My biggest fear is that

once these businesses

exhaust the funds they

have received from

the PPP loans, we will

begin to see massive

layoffs and business

closures that we were

trying to avoid.

PRESIDENT’S MESSAGE

JASON WYATT NMBA PRESIDENT

A s the first “Quarter of Corona” has come to an end, a significant amount of uncertainty remains. Many states have gradually begun to open their economies,

which should help some businesses; however, many more businesses are still struggling to stay afloat. Although PPP loan applications have slowed substantially, banks must now undertake the process of forgiveness, which by all accounts appears to be significantly more complicated and time-consuming than the origination process. Although many of us feared this would be the case, we still chose to originate these loans with the intent of helping our customers and our communities when they needed it the most. I have been told by many bankers that if they had known what forgive-ness would entail, they may have declined to participate in the program. Likewise, many customers have told me that if they would have known how complicated forgiveness would be, in addition to the enormous legal liability they would have to shoulder, they would not have participated. This might be the reason there is over $130 billion in the program that has yet to be allocated and only 40% of lenders are still taking applications. On the positive side, these loans enabled thousands of businesses to remain open and continue to make payroll. Without this program, many businesses would have laid off most, if not all, of their staff. There

is little doubt that unemployment and business closures would have been exponentially higher across the nation. My biggest fear is that once these businesses exhaust the funds they have received from the PPP loans, we will begin to see massive layoffs and business closures that we were trying to avoid. If we cannot fully open our economies very soon, we could easily dip back into recession. Although there are dis-cussions regarding another round of stimulus and simplification of the forgiveness process, Congress is in recess until sometime around mid to late July. This means a new stimulus package may not be passed until August at the earliest. If Congress doesn’t take action sooner, another stimulus might be too little, too late for many small businesses around the country. Now is not the time for Congress to drag their feet and play politics. Remember this next time you vote.

In reviewing the national statistics of the PPP program, many of you might have noticed that New Mexico had the lowest utilization of PPP loans than any other state. I believe several factors most likely contributed to this. First, New Mexico is a small state in terms of popula-tion; however, other states with less population still had higher utilization rates in terms of the number of PPP loans originated and total dollar amount. Second, New Mexico ranks 47th in both labor force participation and

FIRST QUARTER REPORT

Issue 2 • 2020

3


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unemployment rate. Third, federal government employment significantly outpaces private sector employment in our state. In my opinion, it was a combination of all of these factors that likely explain the reason we had the lowest utilization rate.

Because of the unique times in which we are currently living, the vast majority of meetings, banquets, seminars, etc. are now being held virtually. If you are like me, you find this very frus-trating and informal at times. Although it is nice not to have to leave the comfort of your office, for the most part, we are social beings who enjoy face to face interactions. Although a lot can be accomplished virtually, there is just something about meeting in person that seems right. In contrast, virtual meetings do have some advantages. Many organizations can sign up very high-qualified speakers and presenters for these meetings that otherwise would not have been available or affordable. Without the expenses of travel, hotel, food and time, there are many opportunities to hear from experts who otherwise may not have been available to us in the past. Also, you can have many more of your employees listen to the lectures and presentations who may not have had the opportunity to do so in the past. I believe that in the future, we should combine both the face to face meetings and virtual speakers to get the best of both worlds.

Following the trend, the NMBA recently held our “virtual” board meeting on June 11, 2020. Multiple subjects and issues were discussed at the meeting. The Executive Committee recommended that the current officers and board members of

the organization remain in place for the ensuing year due to the unforeseen circumstances we have encountered and the unfin-ished business and projects that remain to be completed. The motion passed unanimously. We also discussed the ongoing success of our internship program at UNM and the future plans to expand the program to NMSU and other institutions. John Anderson presented the somewhat discouraging New Mexico legislative report. Many of our longtime allies and advocates in the Legislature lost their primary elections. It will take a great deal of time and hard work to get to know the newly elected officials and hopefully educate them on the issues that face banking in a way that they, too, will support our organization and industry. We discussed the cancellation of the Annual Convention and Lender’s Conference. At this time, we plan on postponing the Lender’s Conference until February 2021; how-ever, a decision on the date and location of the Annual Conven-tion in 2021 has not been made due to the uncertainty that still remains. Once we are confident that things appear to be getting back to “normal,” we will begin discussing the convention at that time.

Although a great deal of uncertainty still surrounds the future, I have complete faith in the American people and our ability to endure and persevere through any problem or enemy that we face, only to emerge on the other side stronger and better than ever before. I hope everyone had an outstanding 4th of July! n

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EXECUTIVE VICE PRESIDENT’S MESSAGE

JOHN W. ANDERSON,EXECUTIVE VICE PRESIDENT New Mexico Bankers Association

For the first time

in history, due to

the pandemic, the

Capitol was closed

to the public while

the Legislature was

in special session,

a decision that was

upheld by the state

Supreme Court on a

narrow 3-2 vote.

2020 SPECIAL SESSION UPDATE:

T he Special Session of the Legisla-ture began on June 18th and con-cluded on June 22nd. The session was called by the governor primar-ily to modify the state budget for

the year beginning on July 1st after a signifi-cant decrease in projected revenues due to the coronavirus pandemic and a dramatic drop in oil and gas prices and production. Although the budget was the primary focus of the special session, six other issues were also addressed, as noted below.

For the first time in history, due to the pandemic, the Capitol was closed to the public while the Legislature was in session, a de-cision that was upheld by the state Supreme Court on a narrow 3-2 vote. The House and Senate each changed their procedural rules to address this closure.

Budget:HB 1 was the main vehicle utilized for a

reduction in the state budget. The revised budget totaled $7.2 billion, holding spending

even with the current year’s budget rather than the planned increase to about $7.6 billion as adopted in the regular session. HB 1 passed on a straight party-line vote in the House, 46-24, with Republicans arguing that further spend-ing reductions should be made. On the Senate side, four Republicans joined all Democrats to pass the bill 30-12.

A key factor in crafting the new budget was the use of federal funds coming into the state as a result of the CARES Act and other pan-demic-related legislation passed by Congress earlier this year. Those funds allowed the state to avoid what could have been nearly a billion dollars of additional budget cuts for the current and the coming year. Another key factor was the passage of SB 5, which freed up money to help close the budget gap by pulling back funding for certain capital outlay projects that were not moving forward and using long-term bond funding rather than general fund dollars for some projects. The final factor behind the solvency plan was the use of the state’s reserve fund. New Mexico prepared for an economic

Issue 2 • 2020

5


The governor enabled the use of $750 million from the federal CARES Act for revenue backfill. She also announced her decision to allocate funding

from the federal legislation in order to provide $140 million for COVID-19 direct expenditures in the state, $150 million for city and county grants and $28 million for tribal government grants. As a backstop, HB 1 authorizes the

Department of Finance and Administration to reduce state agency budgets an additional 2% if general fund revenues are insufficient.

downturn by aggressively increasing reserves in recent years, which put us in a stronger position than most states to cope with the severe revenue shortfall we’re now experiencing.

Governor Grisham did sign the state budget bill (HB 1) into law but used her line-item veto authority to delete more than $30 million in budget cuts and to restore funding that had been slated for reduction for public school support, culturally and linguistically relevant instructional materials and the Opportunity Scholarship Program.

As noted, the revised budget for fiscal year 2021 totals $7.2 billion, down from the $7.6 billion plan approved in Feb-ruary. Overall, recurring general fund appropriations were reduced by roughly $415 million for fiscal year 2021; non-re-curring general fund appropriations were reduced by $102 million in fiscal year 2020 and $184 million in fiscal year 2021. State reserves in the new budget stand at 11.3%. The governor enabled the use of $750 million from the federal CARES Act for revenue backfill. She also announced her decision to allocate funding from the federal legislation in order to provide $140 million for COVID-19 direct ex-penditures in the state, $150 million for city and county grants and $28 million for tribal government grants. As a backstop, HB 1 authorizes the Department of Finance and Administration to reduce state agency budgets an addition-al 2% if general fund revenues are insufficient.

Other Enacted Legislation:HB 5: New Mexico Civil Rights Commission: The legisla-

tion created a nine-person New Mexico Civil Rights Com-mission. The governor appoints three members and the Legislature six.

The commission will review existing policies and develop policy proposals for legislation for the creation of a civil right of action for the deprivation, by a public body or a person acting on behalf of or under the authority of a public body, of any right, privilege or immunity secured by the constitution of New Mexico. The commission will consider whether such right of action shall provide for monetary damages, including punitive damages and other equitable relief, including injunc-tive relief. The commission will review the use of qualified

immunity as a defense to liability by an employee of a public body for a claim that would be brought either under federal or state law.

The commission will cease to function on March 31st, 2021.

HB 6: Tax Waivers and Distributions: The legislation provides temporary provisions to waive penalties and interest for tax liabilities related to (1) personal and corporate income taxes due between April 15th, 2020 and July 15th, 2020, (2) withholding taxes due between March 25th, 2020 and July 25th, 2020, (3) oil and gas proceeds and pass-through entity withholding taxes due between April 15th, 2020 and July 25th, 2020, (4) gross receipts and compensating taxes due between April 25th, 2020 and July 25th, 2020 and (5) man-aged audits performed between September 3rd, 2019 and January 3rd, 2020. The waiving of penalties and interest are intended to provide flexibility to taxpayers unable to make tax payments due to the outbreak of COVID-19.

The bill doubles the temporary monthly distribution in FY21 to municipalities from $1.25 million to $2.5 million and to counties from $750 thousand to $1.5 million; each to be distributed to local governments in proportion to the popu-lation for each government based on the most recent federal decennial census.

SB 3: Public Finance: The legislation embraces three issues: small business recovery loans, local government loans and unemployment compensation.

• Small Business Recovery Act of 2020: SB 3 provides $400 million of permanent severance funding for a loan program that provides low-interest loans to qualifying small businesses impacted by business disruption resulting from the COVID-19 pandemic. The Act provides:▪ The NM Finance Authority (NMFA), working with

lenders, will administer the loan program;▪ All forms of businesses including sole propri-

etorships, partnerships, LLCs, corporations and certain nonprofit corporations are eligible to apply under the Act;

n EXECUTIVE VICE PRESIDENT’S MESSAGE continued on page 6

6


▪ For a business that operates for profit, the require-ments to qualify include that the business closed or reduced operations due to the public health order issued by the State’s Secretary of Health on March 23rd, 2020, had annual gross revenue of less than $5 million for 2019, gross receipts for the months of April and May of 2020 must have declined by at least 30% when compared to the business’s gross receipts for the same months for 2019, and satisfy an in-state ownership test.

▪ To be eligible under the Act, a for-profit business must satisfy an ownership test. For a sole propri-etorship, 100% of the business must be owned or leased by a New Mexico resident; and for a corpo-ration, partnership, joint venture, limited liability company, limited partnership or other business entity, at least 80% of the total voting power of the entity and at least 80% of the total value of the equity of the entity must be owned by one or more New Mexico residents.

▪ The maximum amount the business can borrow is the lesser of 200% of the business’s adjusted aver-age monthly business expenses or $75,000.

▪ The interest rate on the loan is one-half of the Wall Street Journal prime rate determined on the date of the loan.

▪ The loan is interest-only for the first two years of the loan, with accrued interest due and payable on the first and second anniversaries of the funding of the loan. Additional interest and principal are due and payable on the third anniversary of the fund-ing of the loan. The business may elect to extend the loan term and make monthly payments over the three years commencing on the third anniver-sary of the funding of the loan.

▪ No collateral or personal guarantees are required from the borrower.

▪ The NMFA will determine the creditworthiness of the business loan application.

▪ The loan may be used only for payment of ordinary and necessary business expenses and certain capital expenditures.

▪ The deadline to submit an application to the NMFA for a small business loan is December 31st, 2020.

• Local Government Loans: SB 3 makes $100 million available to the New Mexico Finance Authority to make loans to local governments to provide emergency economic relief. Loans are required to be subject to the standards set forth in the Uniform Prudent In-vestors Act. Local government loan applications must demonstrate that the entity experienced at least a 10% decline in FY 20 operating revenue due to the impact of COVID-19. Loan applications are required to be received by September 30th, 2020. Local governments may borrow 50% of their projected budget shortfall for FY20, as determined by the Department of Finance and Administration. The bill requires the loans carry a 2% interest rate, and proceeds may be used for general op-erating expenses and revenue replacement. Loans will be backed by a dedication of future gross receipts tax

n EXECUTIVE VICE PRESIDENT’S MESSAGE continued from page 5

revenue. Loan periods cannot exceed five years. The legislation requires that the interest on the loan will not compound for the 12 months, and payments will be interest-only for the first three years, after which the local government must make monthly principal and interest payments.

• Unemployment Compensation: SB 3 amends the New Mexico Unemployment Compensation Act relating to the calculation of employer contributions to the un-employment compensation trust fund by omitting the employees’ unemployment claims data for March 1st, 2020 through June 30th, 2021. The legislation would require the use of the 2019 computation data reserve factor from January 1st, 2020 through June 30th, 2021, in calculating employers’ tax rate. As a result of the COVID-19 public health emergency, employers have laid off workers resulting in an extraordinary surge in unemployment claims since mid-March. As a result, New Mexico’s unemployment compensation trust fund is projected to be insolvent by September 2020. Increased layoff amid the pandemic means employers will pay higher unemployment insurance taxes. While SB 3 would keep the employer’s unemployment tax rates stable through the end of 2021, it will reduce income into the unemployment insurance trust fund. In the event New Mexico’s unemployment trust fund depletes its balances, the Department of Workforce Solutions can apply under Title XII of the Social Security Act for a zero-interest loan from the U.S. Department of Labor to stabilize the fund until it can be replenished through employer contributions. However, funds borrowed from the federal government would be interest-free for only two years. Any remaining loan balance would be subject to interest.

Local Government Loans: SB 3 makes

$100 million available to the New

Mexico Finance Authority to make

loans to local governments to provide

emergency economic relief. Loans are

required to be subject to the standards

set forth in the Uniform Prudent

Investors Act.

Issue 2 • 2020

7


It’s money in the bank.

You want your customers to grow and prosper.

After all, their success adds to your bottom line. We can help them achieve their financial goals, because more money in their pockets means more money in your bank.

C PA s

Albuquerque: 505 843 6492atkinsoncpa.com

Henr

y So

uth,

CPA

, CVA

SB 4: Elections: The legislation revises the New Mexico Election Code, which includes provisions relating to con-ducting the general election on November 3rd, 2020, under a COVID-19 pandemic. The bill also allows independent voters to cast a ballot in primary elections by registering as a Republican, Democrat or Libertarian as late as the day of primary election.

SB 5: Capital Projects-Solvency Measures: The legislation was utilized by the Legislature to provide additional funding to be used to offset the state’s budget deficit.

The bill increases non-recurring revenues by $124.2 mil-lion, recurring savings of $16.7 million and authorizes $195 million in additional bonding capacity for capital projects. The non-recurring general fund savings are made up of $10.9 million in capital outlay project voids, a $2.4 million sweep of funds from the border authority, a reduction of $75 million from transportation projects authorized in 2019, and various other fund sweeps totaling $33.6 million.

The bill includes authorization to increase severance tax bonding by $140 million to pay for statewide capital outlay projects and severance tax bond earmarks for water, and tribal projects already authorized, provides up to $55 million for additional public school capital outlay, and provides au-thority for the New Mexico Department of Transportation to issue $75 million in bonds.

SB 8: Law Enforcement: The legislation provides that a law enforcement agency must require peace officers the agency employs and who routinely interact with the public to wear a body-worn camera while on duty. Each law enforce-ment agency must adopt policies and procedures governing the use of body-worn cameras, including:

• Requiring activation of a body-worn camera when-ever a peace officer is responding to a call for service or at the initiation of any other law enforcement or investigative encounter between a peace officer and a member of the public; and

• Prohibiting deactivation of a body-worn camera until the conclusion of a law enforcement or investi-gative encounter;

Bills Introduced but NOT ApprovedHB 8: Rent Control: The legislation would have allowed

political subdivisions and home rule municipalities to enact rent control for privately owned real property.

HB 13: Evictions: The legislation would have provided that for the duration of the public health emergency declared by the governor and for 12 months after the elimination of the order, a landlord may not evict a residential tenant for failure to pay rent.

HB 16: COVID-19 Tort Immunity: The legislation would have provided that a person who operated a business, facility or activity that is open to the public would not be liable for a breach of duty of care when damages or injury are alleged to result from exposure or potential exposure to coronavirus if the person complies with federal and state laws that provide requirements for mitigation of the spread of coronavirus.

Election MattersFive of the most powerful Democrat state Senators were

defeated in the June 2nd primary. Those losing their races include:

• Senator John Arthur Smith, Chairman, Senate Finance Committee

• Senator Mary Kay Papen, President Pro Tem• Senator Gabriel Ramos, Chairman, Senate Indian and

Cultural Affairs Committee• Senator Richard Martinez, former Chairman, Senate

Judiciary Committee• Senator Clemente Sanchez, Chairman, Senate Corpora-

tions Committee

Other legislators not returning in 2021 to the Legislature include Senator Bill Payne (R-Albuquerque), Senate Minority Whip; Senator John Sapien (D-Corrales); Senator James White (R-Albuquerque); Senator Greg Fulfer (R-Jal); Representative Jim Trujillo, Chairman, House Tax Committee (D-Santa Fe); Paul Bandy (R-Aztec); Representative Abbas Akkil (D-Albu-querque); Representative Joseph Sanchez (D-Alcalde); and Representative Tomas Salazar (D-Las Vegas).

There will be a number of close legislative races in the No-vember 3rd General Election-both in the Senate and House. As the Democrats hold a sizeable majority in the House-46 to 24 and in the Senate-26 to 16, it appears unlikely that there will be a shift in legislative leadership in 2020. n

8


Many banks

recognized this

long before the

pandemic hit and

disproportionately

harmed Black

Americans, and long

before the nationwide

protests over the

killing of George Floyd

and others.

WASHINGTON UPDATE

ROB NICHOLS, PRESIDENT AND CEO

American Bankers Association

I s racism baked into our nation’s systems of

justice, health and education, or are there

disproportionate correlations between race,

poverty and crime? Are people too quick to

accuse others of racism, or are those in positions of

power too slow to recognize their role in perpetuating

racia l inequit ies? Is it fa ir that I posed these as

eit her/or quest ions, or i s a l l of t he above t r ue?

RUNNING TOWARD THE CHALLENGE

Issue 2 • 2020

9


Bankers are community leaders, which means you run toward a

challenge, not away from it. So as fraught as the situation may feel,

ABA is engaging in an open dialogue of how the banking industry,

both as employers and as facilitators of wealth creation, can further

the principles everyone agrees on: That all Americans should have

a truly equal opportunity to prosper and that economic inclusion is

essential to creating such opportunity.

While issues surrounding racial justice and inequities are demanding the nation’s attention, honest conversations seem too perilous to hold because of the way some frame the debate as binary. But that ignores the vast common and principled ground on which we all stand and distracts from a focus on meaningful solutions.

Bankers are community leaders, which means you run toward a challenge, not away from it. So as fraught as the sit-uation may feel, ABA is engaging in an open dialogue of how the banking industry, both as employers and as facilitators of wealth creation, can further the principles everyone agrees on: That all Americans should have a truly equal opportunity to prosper and that economic inclusion is essential to creating such opportunity.

Implicit in this discussion is the belief that we each have a role to play in addressing longstanding inequities. Some may feel the problem lies elsewhere — in another communi-ty, city or state — and therefore, so must the solution. Others may think they’ve done all they can to either great or limited effect. But we are an industry that, in recent years, has de-veloped entirely new ways of banking, and in recent months demonstrated remarkable fortitude and commitment to serving our customers through the pandemic. There is more we can — and must — do to address disparities and promote prosperity for all.

Many banks recognized this long before the pandemic hit and disproportionately harmed Black Americans, and long before the nationwide protests over the killing of George Floyd and others. Some in recent years have built rigorous diversi-ty, equity and inclusion programs that are both inward-fac-ing (focused on employees) and external facing (focused on customers, communities and vendors). Some have pioneered new ways to qualify borrowers and bring those who have been marginalized into the banking system. We celebrate them ev-ery year with the ABA Foundation’s Community Commitment

Awards. Still others have partnered with Minority Depository Institutions and Community Development Financial Insti-tutions to share compliance resources, expertise and more to better enable those institutions to meet the needs of their often underbanked customers.

ABA is tapping the experiences of these banks and leverag-ing the expertise of our staff experts on diversity, equity and inclusion to provide others with tools and resources to make a difference at their own institutions. A new peer group for in-stitutions with robust DE&I programs met for the first time in February and is helping us identify leading industry practices in this space that we can share with members. In April, we convened our Diversity, Equity & Inclusion Advisory Group, which is composed of individuals from banks of all sizes and whose mission is to help us nurture bank DE&I efforts. I was also pleased to announce a strategic partnership this year with the National Bankers Association, the leading trade asso-ciation for MDIs, to promote the health and well-being of un-derrepresented communities. And we are collaborating with and promoting MinBanc, which reimburses the educational and professional development expenses of MDI bankers.

This is all to say that both ABA and the industry have a strong foundation upon which to build. And build, we must. Unacceptable racial disparities in health, wealth, income, ed-ucation and other measures of opportunity continue to grow — and the pandemic has laid bare these disparities. Propor-tionately, two and half times more Black Americans have lost their lives to COVID-19 than white Americans.

We cannot shrug our shoulders and declare these inequities someone else’s problem. We cannot fail to engage. We are bank-ers, we are civic leaders, and we must be part of the solution. n

E-mail Rob Nichols at [email protected].

10


I n every town and city in New Mexico, community lend-ers play a vital part in the mortgage economy. Their pivotal role has been highlighted yet again in 2020 as they help families and businesses face the unique chal-lenges this year has presented to all Americans. While

they exist in every community, no two community lenders are the same. For that reason, no two mortgage portfolios are exactly alike.

At Golden Eagle Insurance, we make no secret of the fact that Blanket portfolio solutions are our specialization. But the true value that we can provide to community lenders is our focus on custom-tailored mortgage policies arrived at through a consultative approach. Our goal in every interaction is to use

our insurance expertise to find the best possible solution for each lender, even if that solution may not be one that we can provide. For that reason, we want to highlight below a vari-ety of mortgage solutions that community lenders across the country find useful in different circumstances.

Blanket MortgageAs stated above, Blanket solutions are Golden Eagle’s spe-

cialization. The advantages that Blanket mortgage programs can offer are profound, including eliminating tracking and force-placing, making compliance easier and cutting down on tough interactions with borrowers. Within a Blanket mortgage program, there are many possible points of customization, such as certain coverages, limits and exclusions. Blanket

HOW A CUSTOM CONSULTATIVE APPROACH TO MORTGAGE PORTFOLIO SOLUTIONS MAKES ALL THE DIFFERENCEBy Allen Moss, VP Regional Business Development, Golden Eagle Insurance

Issue 2 • 2020

11


Mortgages can cover all real estate in a portfolio and can be separated by portfolio. For example, you can buy protection on commercial real estate, or only on your first mortgages. While the term “blanket” sounds like a one-size-fits-all plan, Golden Eagle works with lenders to customize it to their exact needs, wants, and goals.

Force-Placed Hazard, Flood & REOFor some lenders, force-placing hazard and flood protection

is a desire or even a requirement. During any consultation, Golden Eagle will seek to identify if this strategy is a better fit than Blanket coverage. Our force-placed hazard/flood provides all-risk protection for tracking insurance for hazard and/or flood when a borrower lacks adequate insurance on a mortgaged property. REO coverage provides liability coverage on properties owned by financial institutions. What makes our force-placed policies advantageous is an array of included and unique coverages that provide extra peace of mind to the lender. These include Blanket 90 protection, which provides Blanket coverage for 90 days from the date of a cancellation or expiration on an existing policy. Blanket 90 helps elimi-nate negative interactions with borrowers as most renewals or reinstatements will be received within the 60-day window before notification is required. Force-placed policies also can include an optional Automatic Coverage Endorsement that will protect from loss due to error or omission. For lenders that desire force-placed coverage, the ability to tailor it in this manner is a huge advantage.

Mortgage ImpairmentSome community lenders require mortgage impairment

protection. This enhances a mortgage holder’s errors and omissions policy by providing the broadest coverage available as a separate policy. The supplemental coverage is designed to cover losses not typically covered by basic mortgage holder E&O policies. We will work with you to tailor a mortgage im-pairment policy to your specific needs.

Allen Moss, VP, Regional Business DevelopmentAllen joined Golden Eagle Insurance in October 2019 as a VP of Regional Business Development. He will primarily be consulting with lenders in Texas, New Mexico, Arizona, Oklahoma and Arkansas. Allen is a graduate of the United States Military Academy at West Point with a major in Mathematics. After grad-uating from West Point, Allen spent time at Schofield Barracks, Hawaii, as an infantry officer. Following

that assignment, Allen was selected to join the 75th Ranger Regiment at Fort Benning, Georgia, where he served as the Reconnaissance Company Operations Officer. Allen currently resides in Hilliard, Ohio, and enjoys traveling, the outdoors, sports and [email protected], 1-800-461-9224 Ext. 1023

New Vista SolutionsGolden Eagle is proud to partner with New Vista Solutions

(NVS). New Vista has been a leading provider of mortgage settlement services since 2007. NVS provides a full suite of solutions for mortgage originators, including appraisals, alter-native valuation products (AVPs), credit reports, flood certi-fications, alternative title products, and income and employ-ment verification. All these services are accessed through one user-friendly online portal. By simplifying and streamlining the origination process, Financial Institutions reduce the time to close a loan and ultimately realize greater profits.

Beyond the solutions listed above, Golden Eagle can help community lenders with outsourced insurance tracking, equity default protection, flood determination certificates and much more. Our wide array of mortgage portfolio solutions is a definite advantage, but what we truly take pride in is our commitment to work hand in hand with lenders to help them improve their business. For over 25 years, our consultative approach and commitment to partnership have been at the forefront of what we do. We are a community-minded compa-ny, just like you, and we let those principles drive us every day. If you think we may be able to help your institution, please call us to set up a free consultation. n

For some lenders, force-placing hazard and flood protection is a desire or even a requirement. During any consultation, Golden Eagle will seek

to identify if this strategy is a better fit than Blanket coverage. Our force-placed hazard/flood provides all-risk protection for tracking insurance for hazard and/or flood when a borrower lacks adequate insurance on

a mortgaged property. REO coverage provides liability coverage on properties owned by financial institutions. What makes our force-placed policies advantageous is an array of included and unique coverages that

provide extra peace of mind to the lender.

12


W e are several months into the COVID-19 pandemic and a sobering realization must be grappled with. The United States has spent the past four-plus months attempting to deal with the pandemic and, in several

key areas, has struggled, largely due to one of the most spec-tacular failures of the federal government in American history. To put it simply, we have been spending the last few months running around in circles to a degree, completely unable to recognize the proper solutions to this pandemic due to the woefully inadequate leadership at many levels of government.

The statistics lay it out plainly. The United States has over twice as many deaths and nearly twice as many COVID-19 cases as the next closest country, Brazil. And Brazil’s pres-ident, Jair Bolsonaro, has essentially chosen to act as if the virus doesn’t exist. The failure in the U.S., both from an economic and health standpoint, has been so catastrophic that it could reverberate for decades. After spending nearly two months with states in lockdown and individuals in quaran-tine, without any federally mandated safety protocols, it seems as if President Donald Trump and his administration essen-tially threw up their hands in early May and decided to reopen the economy. The problem was that the reopening of the

economy was essentially a charade, an attempt to show things going back to normal from a pure optics standpoint while the virus was still raging uncontrollably through many states.

The root of the problem goes back to the initial response in

the CARES Act. As David Dayen broke it down incredibly well in The American Prospect, “The CARES Act supplied $150 billion to states but only for emergency coronavirus spending not accounted for in state and local budgets. So, it could not be used to plug increasing budget holes. The continued shortfall was closer to $1 trillion, and it grew every minute that cities and states remained locked down. This weighed heavily on cit-ies and states and unquestionably played a role in the timing of the reopening. While most developed countries waited until their average case counts were quite low before letting people back into the world, states were pressured into salvaging their economies and bringing in some semblance of revenue by throwing open the doors. This was a direct result of not hav-ing any guarantee from the outset that state and local budgets would be taken care of. The result has been catastrophic, and the states that opened early know it. There’s no doubt that the official reopening orders gave many residents confidence to venture back out when they should have stayed home, lead-ing to the wider outbreaks. And there’s no doubt that these

THE CORONAVIRUS PANDEMIC: RUNNING AROUND IN CIRCLES LOOKING FOR AN ANSWER — OPINION

By Mark Anderson, Legal and Legislative Assistant, New Mexico Bankers Association

Issue 2 • 2020

13


businesses and these cities and states are now in a far worse position economically than if they waited it out. Restaurants that managed to survive in March and April, only to open and face a downturn in July, are much less likely to persevere. Just in the immediate term, food purchased in the expectation of reopening will not get used. Workers brought back will be sent home. The start and stop were economically and emotionally jarring, and it risks a wider failure. It also has put all other businesses at greater risk by increasing the amount of virus. It makes it hard to send people back to offices or other less per-ilous activities. This hurts local economies even further, and this damage was precipitated by depriving them of a safety net in the initial bill.”

Additionally, the CARES Act was the greatest upward

transfer of wealth in American history. This is a country in which middle and lower-class people have been getting hammered economically for decades, and we have just seen the greatest upward transfer of wealth, the long-term effects of which have yet to be felt. Americans who make less than $75,000 per year received a one-time $1,200 stimulus pay-ment. At the same time, the Federal Reserve, in mid-March, essentially decided to fully socialize the funding markets, pumping trillions in liquidity into them on a weekly basis. Now, we have had a complete decoupling of the financial

markets from everyday people. The Dow Jones and S&P have largely rebounded to where they were pre-pandemic because the Fed has fully backed them. Meanwhile, an estimated 27 million people lost health insurance between March and May, millions are losing employment every week, and there is an impending rent and mortgage crisis. Now, any claim that the stock market has any relation to the economic fate of the aver-age American is beyond absurd. The reality of having impend-ing economic conditions that could rival the Great Depression while the stock market is soaring highlights wildly misplaced economic priorities.

Our lack of a coherent response to this crisis has led to an

inability for states to deal with it in a uniform fashion, so some states have contained the virus while others have allowed it to get completely out of control. The administration, after a month or so of attempting to deal with the pandemic, chose to give up when they should have been most engaged with how to solve the crisis, even ceasing to talk to top scientists and doc-tors around them. This is unacceptable behavior from individ-uals tasked to be public servants. That response seems to have bled into local governments, as certain governors and mayors were acting as if the pandemic was over in mid-May, leading many citizens to act in the same way. This kind of behavior and lack of critical thinking from elected officials should cause

THE CORONAVIRUS PANDEMIC: RUNNING AROUND IN CIRCLES LOOKING FOR AN ANSWER — OPINION

14


people to evaluate what kind of country they want this to be. Our inability to handle this crisis at the top of our govern-ment has been painful, and, hopefully, it will motivate more Americans to invest time in voting for and creating a better government. The leaders of our government were willing to send people out to essentially die or get sick all to look a little bit better temporarily, from an optics standpoint, to sell a charade that the virus was over. A report from early July in-dicated that the president and his staffers hope the American public “grows numb” to the pandemic. We cannot allow that to happen, and it is essential that a huge majority of Americans demand better.

On a local level, New Mexico has handled the pandemic

well overall, with some bumps in the road that all states have experienced along the way. As of late July, New Mexico’s posi-tive test rate has stayed in the 2-5% range, which is encourag-ing. Certain states have positive test rates in the 15-25% range. At this point, it is helpful to look at positive test rates because it indicates how quickly the virus is spreading. In that regard, New Mexico has been successful with plenty more work to do to get our positive test rate even lower. Governor Michelle Lujan Grisham deserves credit for acting decisively and

coherently throughout this crisis. Her decisions throughout the pandemic have not always been popular, but it is the job of public officials to sometimes make unpopular decisions in the best interest of their citizens.

The Governor has had to perform the incredibly difficult

balancing act of protecting the health of the state with the economic reality that faces small businesses. Make no mis-take about it, the jobs of this country’s governors have become exponentially more difficult because of the absolute incoher-ence of the federal response to the pandemic. But, given that, Governor Lujan Grisham has done a commendable job in putting the safety of New Mexicans at the top of her priority list. She ordered the state to be placed on lockdown early in the pandemic when some other governors waited days or even weeks, possibly saving hundreds or thousands of lives, and has been acting on the side of caution, which will be viewed as being on the right side of history. It must be stressed that the federal government has put governors in remarkably difficult positions. It’s a fact that the federal government’s bungled response will be hugely damaging to thousands of small businesses and New Mexico is not exempt from that. Much of the ire that will be directed toward local officials as small

On a local level, New Mexico has handled the pandemic well overall,

with some bumps in the road that all states have experienced along

the way. As of late July, New Mexico’s positive test rate has stayed in

the 2-5% range, which is encouraging. Certain states have positive test

rates in the 15-25% range. At this point, it is helpful to look at positive

test rates because it indicates how quickly the virus is spreading. In

that regard, New Mexico has been successful with plenty more work to

do to get our positive test rate even lower.

Issue 2 • 2020

15


Albuquerque: 505-843-9232 | Las Cruces: 575-524-6830 El Paso: 915-500-1055 | www.ELCDC.com

Enchantment Land CDC is a local non-profit that assists in the growth and development of small businesses in New Mexico and El Paso, offering local expertise and local decisions on SBA 504 loans.

Empowering the Local Economy

businesses face mounting pressure should be directed instead at the absolute failure of the federal government to provide further stimulus payments to individuals and, in the most de-finitive way possible, prioritizing corporations and billionaires over everything else, most notably small business.

Despite the current difficulties, there is a reason for op-timism locally. Governor Lujan Grisham is continuing to emphasize film and television production as a burgeoning in-dustry in the state. She is correct to do so, as the industry has overwhelming popularity in the state, with over 70% of New Mexicans recently polled having a favorable view of it. During the fiscal year 2019, direct spending from the film industry was $525.5 million, a record high for the state. The Governor is savvy to identify film and television production as a dynam-ic and evolving industry that can be sustained in the future.

While the industry has been shut down during the pan-demic, the governor has had her eye on the ball, restarting the Council on Film and Media Industries, which has been dormant for over a decade. The chairman of the council, James Gollin, said the industry is positioned to recover quickly following the COVID shutdown and is flexible in its working methods: “If we can avoid the obvious roadblocks and bottlenecks, the industry can rapidly double in size and then more slowly double again, supporting ancillary industries, and helping lead the way towards a more sustainable and diversified economy that will benefit all New Mexicans.” Amber Dodson, the director of the New Mexico Film Office, is equally optimistic

about the path of the state and the industry: “Our film industry is on a high-growth trajectory and the new council will ensure that New Mexico will continue to be ahead of the curve, deft, strategic, and even more prosperous.”

While this is an incredibly difficult time in this country, New Mexico is in a position to build a sustainable, dynamic economy for the future. It is becoming increasingly apparent that we are at a transformational point in American history. People are thinking about deeper systemic issues more than at any point during my lifetime; they’re thinking about how the economy is fundamentally structured, what can be done to ameliorate systemic inequality, and what policies are best to carry that vision out. Governor Lujan Grisham, while having to make difficult decisions, has kept her eye on sustaining New Mexico economically in the future. While there will always be disagreements about a myriad of issues, I believe that the state is on an upward trajectory. The states that will emerge from the Coronavirus pandemic stronger than before are the ones that have their eyes to the future and that are looking to spot economic and social trends before they become conven-tional wisdom. Under current leadership, I believe that this state is better positioned to do so than at any point that I can remember. While the coronavirus pandemic has taken an enormous toll on this nation, having a reason for optimism is essential to maintaining societal well-being and participation. New Mexicans should be heartened that their state leadership has shown composure, intelligence and an eye toward future economic opportunities during this society-changing time. n

16


W h i le you m ay

not be thinking

o f c u s t o m e r

profitability

as much these days, customer

relationships are always important.

Right now, you are working on filling

the immediate needs of your business

customers, which is crucial. Paycheck

Protection Program loans, loan

modifications, and line extensions

are all likely often discussed to ensure

that your banking customers stay in

business. However, there will come

a day when COVID-19 isn’t a crisis

anymore and businesses start settling

back into their place in the economy.

When that happens, you will want to

have your customer profitability ready.

So, in preparation for that day, we

wanted to discuss the top three steps to

assessing your customer profitability.

THREE STEPS TO ASSESS CUSTOMER PROFITABILITY POST-COVID-19By Jay Kenney, SVP, Regional Manager, PCBB

16

Issue 2 • 2020

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1. Gather Customer Data. While you are satisfying the demands of your customers, you are gathering data, of course — from the number and type of transactions to fees waived and the length of their loans. For new customers signed up for the Paycheck Protection Pro-gram, data collection is even more critical. Leveraging that data in the future to understand how to best serve those customers is one of the most important ways to assess customer profitability, so make sure the data you collect is clean and accurate.

2. Use Communications. It goes without saying that continual communications with your customers provide you with additional information as well. Once they have their business back on solid ground, you will want to check in to see their plans for the future. You will also want to remind them of the important of-ferings you can provide that help them along the way; use multiple channels including email, your digital portal and your website. With continual touches, you can capture more information for a complete customer profitability picture.

3. Apply Profitability Indicators. While collecting customer data is key, profitability indicators help you use that data effectively. There are certain indicators,

such as the number of services or length of the rela-tionship, that will provide you with more confidence in the customer’s loyalty and profitability. This could help determine your game plan with the customer. If one customer has three services and five years with your institution while another has one service and one year, the data shows that the former will be more loyal, but not necessarily more profitable. Having a model to both track and analyze this data is important to see where there are gaps in profitability and opportunities for additional income.

We all look forward to the day when COVID-19 is a distant memory. Until that day comes, start preparing to assess your customer profitability. n

Jay KenneySVP, Regional ManagerPhone: (213) [email protected]

Dedicated to serving the needs of community banks, PCBB’s comprehensive and robust set of solutions

includes cash management, international services, lending solutions and risk management advisory services.

18


T he COVID-19 pandemic has changed American life as we know it. As the country continues to deal with the health crisis, the effects of containment measures ripple through the American economy. Unemployment remains high as state economies

expand and contract in inverse proportion to the virus’s spread. Regulators are in an arms race with rapidly changing markets, forcing banks to adapt to an ever-changing regulato-ry landscape. Even as we struggle to deal with the immediate concerns, we know the effects of this pandemic will be with us for some time. Economic shocks will continue to reverber-ate and play out in the housing markets around the country. As we shift into the next phase of operating in the pandemic and consider what options exist to help struggling mortgage borrowers, we should take note of the status of the expansive mortgagor protections passed by Congress, federal agencies and other government authorities.

Protection for Federally Backed Mortgage LoansIn the early days of the pandemic, Congress passed the

Coronavirus Aid, Relief, and Economic Security (“CARES”) Act. One of the primary sections of this law established a 60-

day moratorium on foreclosure proceedings against home-owners with federally-backed mortgage loans. The CARES Act’s mortgage foreclosure moratorium applied to single-fam-ily residential mortgage loans secured, guaranteed, or made by FHA, USDA, VA, or Fannie Mae or Freddie Mac. Originally scheduled to expire at the end of June, the various agencies extended the moratorium on foreclosures and evictions until at least Aug. 31, 2020.

The CARES Act also granted federally backed mortgage loan consumers experiencing financial hardship related to the COVID-19 pandemic, the right to request six months of forbearance (with an option of six additional months), regard-less of delinquency status. Congress prohibited servicers from charging any fees related to this forbearance. Mortgage delin-quency status is frozen in place during forbearance, even if the bank suspends payments during the forbearance. As it stands today, customers can request forbearance under the CARES Act until the earlier of the end of 2020 or the end-date of the national emergency concerning the novel coronavirus disease outbreak declared by the president on March 13, 2020, under the National Emergencies Act.

FORECLOSURE PROTECTION: WHERE ARE WE NOW?By Chris Bell, Compliance Alliance

18

Issue 2 • 2020

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State and Local-Level ProtectionMany state and local authorities enacted policies to protect

mortgage borrowers and renters. The details of these state and local foreclosure bans vary. Banks should refer to the official web-sites for their state and local governments to assess the scope and requirements of applicable prohibitions. While effective dates vary widely, many of these protections remain in effect until respective governors lift statewide emergency declarations.

Private loansThe CARES Act provided no relief for loans that are not feder-

ally backed. Banks should refer to the appropriate investor guide-lines for mortgages sold to private investors. Banks should refer to guidance from its regulators concerning their expectations regard-ing non-federally backed mortgage loans held in portfolio.

Troubled Debt Restructuring (“TDR”)If neither a federal nor a state moratorium applies to a residen-

tial mortgage you hold in portfolio, you may still be able to exercise your authority to assist pandemic-effected borrowers who are struggling financially. Regulators have urged banks to work with

customers and prudently modify loans in a safe and sound manner. Section 4310 of the CARES Act provided banks relief from TDR. In April, regulatory agencies issued revised interagency guidance to help banks sort modification requests into three groups: (1) loan modi-fications covered by Section 4310 of the CARES Act; (2) those outside of Section 4310 deemed not to be TDRs; and (3) those outside of Section 4310 that may be TDRs. In June, regulators released new interagency safety and soundness examiner guidelines. These guidelines instruct examiners to not criticize institutions for doing so as part of a risk mitigation strategy intended to improve existing loans, even if a restructured loan ultimately results in adverse credit classifications.

To be covered by Section 4310 of the CARES Act, a loan modification must: (1) relate to COVID-19, (2) be executed between March 1 and December 31 (as-suming the current national emergency does not end earlier than the end of the year), and (3) the underlying obligation must be not more than 30 days past due. If a loan modification meets these three criteria, financial institutions do not have to report it as a TDR; however, the financial institution should maintain records of the volume of such loan modifications.

If a loan modification fails to meet any of the three criteria for Section 4310 coverage, it does not automati-cally result in a TDR. Regulators will deem a modifica-tion as not to constitute a TDR if it relates to COVID-19, extends no more than six months, and the underlying obligation is not more than 30 days past due. The only subjective criterion is the relationship of the modifica-tion to COVID-19. As a best practice, banks should have the borrower certify that the requested change is due to COVID-19. To not raise HIPAA concerns, the certifica-tion should be general and not address specific health details. While such a certification is not required to be in the loan file, it would show future examiners that the lender followed the guidance in good faith. If a bank re-ceives a modification request that is outside the scope of Section 4310 and does not meet the described criteria, the bank should assess whether the modification would be a concession to the borrower that the bank would not otherwise consider and act accordingly.

As with everything related to the COVID-19 pandem-ic, expect mortgage foreclosure protections to change as the county continues to deal with the long-term effects of our national crisis. The federal agencies may extend the protections relating to the loans they back, and Congress will undoubtedly reassess the CARES Act’s protections as the end of its covered period draws near. Despite how things change, you can count on the Texas Bankers Association to bring you the most up-to-date information available as we walk hand-in-hand through this crisis. n

Chris W. Bell is an associate general counsel at Compliance Alli-ance. He has worked in the legal department of a federal savings bank and for the Texas Department of Banking. He is one of the C/A hotline advisers.

20


By John Reynolds, Vice President of Sales, Document Services, CSI

5 WAYS YOUR FINANCIAL INSTITUTION CAN USE DIGITAL TOOLS TO CONNECT WITH CUSTOMERS DURING COVID-19

5 WAYS YOUR FINANCIAL INSTITUTION CAN USE DIGITAL TOOLS TO CONNECT WITH CUSTOMERS DURING COVID-19

Issue 2 • 2020

21


I n response to the continu-ing challenges related to COVID-19, many financial institutions are relying on digital tools, including

document management systems, to keep some semblance of normality.

Document management systems are among the digital solutions that help your institution streamline operations and external commu-nication. As financial institutions navigate this unprecedented situation while providing essential services to customers, maintaining productivity remains a priority. Follow these best practices to ensure your institution is operating efficiently while continuing to serve your customers during this time.

1. Electronic Document DeliveryTo connect with customers, many financial institutions are using digital statements. With digital eStatements and eNotic-es, your customers can securely view a dynamic, interactive statement or bank notice on-line. Using these digital tools, your institution can reduce your paper and postage costs while offering convenience and physical safety during the COVID-19 pandemic.

2. Centralized Document LibraryAnother way to provide cus-tomers with easy access to their financial information is through the use of a central-ized document library. With user-friendly search tools, your customers can find the information they need without coming into a physical location, resulting in their questions being resolved more quickly.

3. Customer Communica-tionIn this evolving situation, your customers need up-to-date in-formation from your institution. Using digital marketing tools like statement marketing banners, your financial institution can effectively communicate with

customers through personalized messages, such as information on a virtual wealth management seminar, community and public health concerns or new policies at your institution.

4. Digital Delivery ChannelsMany bankers are facing a variety of concerns due to the circumstances surrounding COVID-19; primarily the safety of their employees and custom-ers, prompting them to promote digital delivery channels as an alternative to branches. If your customers are not participating in digital or mobile banking, encourage that option so your customers will have access to their accounts at any time.

5. Personalized Customer ExperiencesIn today’s world, customers demand personalized experi-ences in every interaction, and the ability to provide that, es-pecially in uncertain times, will set your financial institution apart. As digital transformation continues to drive innovation in our industry, consider how your institution will use technolo-gy, such as cloud migration or digital platforms, to enhance or create new customer experienc-es to meet their changing needs.

As financial institutions continue adapting to the challenges stem-ming from this global pandemic, any investment — from digital statements to digital banking — that allows your institution to boost its capabilities, increase efficiency or better meet your customers’ needs is worth considering. With the many changes brought on by COVID-19, financial institutions that choose to embrace digital transformation and rethink their business technology will be ahead of their competition. n

John Reynolds is vice president of Sales, Document Services at CSI.

Reach your customers with print. To advertise in this magazine contact us today.

801.676.9722 | 855.747.40034049 South Highland Dr.

Holladay, UT 84124thenewslinkgroup.org

Cut through the noise with a more authentic experience.

Issue 2 • 2020

23


BANK NEWSU.S. Bank’s Dominguez Named to “40 Under Forty” List

Erin Dominguez, vice president/district manager of Northern and Central New Mexico of Minneapolis, Min-nesota-based U.S. Bank, has been named one of New Mex-ico’s “40 Under Forty” recipients. Albuquerque Business First’s “40 Under Forty” Awards honor young profession-als who are making an impact in New Mexico.

“As a district manager for U.S. Bank, chair of Junior Achievement and a board member of National Hispanic Culture Center, I am fortunate to work with our commu-nity in a variety of ways,” Dominguez told Albuquerque Business First, “[including] teaching financial literacy, influencing our employees and board members to become leaders and strong partners in our community [and] shar-ing the beauty and culture of New Mexico.”

Business First will celebrate “40 Under Forty” honorees

Sept. 30 in Albuquerque.

New Mexico Bank and Trust Recognized as One of America’s Best-In-State Banks

New Mexico Bank & Trust announced that it was rec-ognized as one of America’ Best-in-State Banks 2020 by Forbes Media for the second year in a row and was ranked among the top U.S. commercial credit card issuers for purchase volume growth for the fifth year in a row.

Forbes and market research firm Statista identified New Mexico Bank & Trust as an America’s Best-in-State Bank 2020 based on an independent survey of over 25,000 consumers who ranked banks with whom they have or previously had a checking account. New Mexico Bank & Trust scored among the highest in overall customer satis-faction and recommendation, including trustworthiness, branch and digital services and financial advice.

“It’s an honor to receive this recognition for the second year and a true testament to our community and custom-er-focused values, as well as the strength and commit-ment of our entire organization,” NMB&T President/CEO Greg Leyendecker, said. “We understand the importance for our clients to manage cash flow, maintain relation-ships with vendors, and negotiate favorable terms. We are pleased to be recognized as a leader in the commercial credit card space as we provide solutions that meet the needs of our clients and the marketplace.”

Bankers Health Care Group-New NMBA Associate Member

The New Mexico Bankers Association is pleased to an-nounce our newest associate member, Bankers Healthcare Group (BHG).

BHG has been lending for nearly 20 years and is the #1 source for medical and professional loans across the coun-try. Having underwritten over $25 billion in loans, they have gained unmatched insight into these borrowers.

Today, more than 1,100 banks have partnered with BHG to buy these high-quality loans through their online loan hub, earning them a combined interest income of over $600 million. BHG has shown”

• $0 historical bank loss on BHG Core loan portfolio; and

• Stellar Borrower Characteristics (for June 2020): Weighted average FICO: 741 Weighted Average Income: $352K Weighted average term: 97 months Weighted average loan amount: $89,000 3-6.5% return for your bank

You can learn more about BHG and how it can benefit your bank: https://lp.bhgandbanks.com/bhg-loan-hub/?bhgid=8240

NMBA Endorses Abrigo’s PPP Loan Forgive-ness Solution

The New Mexico Bankers Association has endorsed Abrigo’s Protection Program Forgiveness and Administra-tion solution, part of the Sageworks SBA Lending solution, to assist member banks in streamlining the loan forgive-ness and administration process.

In addition to increased efficiency and speed on the front end, Abrigo’s solution also gives banks the ability to calculate the forgiveness amount based on the provid-ed PPP guidelines to ensure compliance and accuracy. Lenders can also generate Form 1502 within the platform to request their loan processing fees from the SBA and for ongoing monthly servicing.

Over 175 community financial institutions used Abri-go’s automated PPP loan origination solution, with E-Tran integration, to quickly and efficiently process over 110,000 PPP loans, totaling more than $11.1 billion in loan volume, since the program was first launched on April 3rd.

MBA member banks will receive preferred pricing for

Abrigo’s PPP forgiveness and Administration solution through the association. n

24


BANKERS ON THE MOVE

Century Bank Names Rogholt New Regional President for Southern New Mexico

Santa Fe-based Century Bank has named Michael Rogholt as regional president for southern New Mexico. He will oversee the bank’s Albuquerque, Rio Rancho and Las Cruces operations, filling the role vacated by Chez Steel, who joined Albuquerque-based Southwest Capital Bank in April as CEO.

Rogholt joins Century Bank with 23 years of expe-rience in the financial services industry, most recently serving as a commercial banker at Wells Fargo Bank in Albuquerque.

Rogholt is a board member of Albuquerque’s All Faiths Children’s Advocacy Center and previously served on the boards of the New Mexico Community Devel-opment Loan Fund, Manzano Day School and the Rio Rancho Economic Development Corp.

Established in 1887, Century Bank operates nine New Mexico locations-four in Santa Fe and one each in Espanola, Rio Rancho, Albuquerque, Las Cruces and Los Alamos.

J. Dee Dennis Joins Sunflower Bank’s board of directors

J. Dee Dennis Jr., founder of DKD Electric, LLC, has joined Sunflower Bank’s board of directors. Dennis has more than 40 years of experience building and growing businesses. He founded DKD Electric Co. in 1978 and led the New Mexico-owned and operated enterprise un-til it went public in 1999; became the regional operating officer for IES, a publicly-traded company, overseeing

27 businesses; and in 2005, he led a group of investors that took DKD private, building it into the large regional contractor it is today.

From 2010 to 2013, he served as New Mexico’s Cabi-net Secretary of Regulations and Licensing Department. He has served on numerous boards and service panels, including the Children’s Cancer Fund of New Mexico, Associated General Contractors, Associated Builders and Contractors, University of New Mexico Lobo Club and Independent Electrical Contractors. n

Visit us online!Visit us online!www.www.nmbankersnmbankers.com.comwww.facebook.com/pages/New-Mexico-Bankers-Association/371559049590485

Our Member Services include:

• Unlimited support via the toll-free Payments Answerline™

• Free copy of the Nacha Operating Rules and Guidelines every year (book format for financial institutions; online access for affiliate members)

• Free members-only webinars

• Member discounts on education, publications, and some conferences

• Training programs for AAP, APRP, and NCP certifications

• Access to our Connections Member Community

• The opportunity to participate in ePay FOCUS, connecting businesses, financial institutions, and processors

• Member discounts on risk management, compliance, and consulting services from our wholly owned subsidiary, ePayAdvisors

• Monthly electronic newsletters

• Periodic education bulletins, operations alerts, and fraud alerts

• Representation and advocacy at the national level, including the Nacha rule-making process

• ePay Bucks (financial institutions only)

• Quarterly ACH Volume Reports (financial institutions only)

• Over $10,000 awarded in Payments Education scholarships for The Payments Institute and Payments University (financial institutions only)

Empowering our membersto be informed, compliant,

and competitive in payments

epayresources.org

@ePayResources_

@ePayResources

ePayResources

Payments Answerline™1-800-475-0585, Option 1

For over forty years, ePayResources™ has provided financial institutions and businesses with payments expertise, professional development, and industry leadership through education, compliance support, publications, risk mitigation resources, and advocacy.

As a Regional Payments Association staffed by certified experts, we empower you to be informed, compliant, and competitive in payments, including ACH, Checks, Card, Wire, Mobile, RDC, and Real-Time Payments.

Do you need more payments expertise?

Think of ePayResources as an extension of your team!

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PAIDSALT LAKE CITY, UT

PERMIT NO. 508

New Mexico Bankers Association 316 Osuna NE, Suite 502 Albuquerque, NM 87107

This magazine is designed and published by The newsLINK Group, LLC | 855.747.4003

MPFMPF®®asas a a Secondary Secondary

Market StrategyMarket Strategy

A one-time premium for selling the loan

into MPF®

25 bps annually with servicing-retained or a one-time premium with

servicing-released

Ongoing monthly revenue through the Credit Enhancement

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Call Member Services 844.FHL.BANK (844.345.2265) or visit fhlb.com/mpf

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MPF®as a Secondary

Market Strategy

Documents

ISSUE 2 2020 - nmbankers.com Files/New folder (2... · ISSUE 2 2020 PAGE 2President’s Message — Jason Wyatt Executive Vice President's Message — John W. Anderson PAGE 8 Washington