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RLR Newsletter 1st Quarter 2010 |
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![[2009+rearview+mirror.jpg]](../images/clip_image002_005.jpg)
It is hard to believe that 2009 has come and gone. What a wild year for banking! One that I have not seen since the early nineties when over 800 banks failed in three years. In 2009, 140 Banks failed, seventeen (17) of those Banks were in California. There are over 500 Banks on the problem institution list. It is possible that twenty (20) or so of those in California will close in 2010. Probably so.
What happened? We would all like to know!
Is it the economy?
The government/regulators? The management?
The economy - We all know that 2009 was just not a good year. By year end, the economy looked a little better. With the rising stock market in the 4th Quarter, consumers were able to recover (some). Retail sales were showing positive growth on a year-over-year comparison.
The government/regulators - The regulators expanded their staff and reach, and we experienced some inconsistencies with and within the agencies. Rumor has it that the regulators would not mind if there were only 5,000 Banks versus the 8,000+ there are today.
Hmm...
The management - YES! In days of old, bankers had to take classes to be bankers, and we had to continue education to move up the ladder. We cared about our customers, and we would never put them in harm's way. We prided ourselves in the way we conducted business and kept meticulous records. What happened?
Old-time bankers began retiring, and the newer kids on the block were not required to have the requisite "Banker" training. Management did not keep their eye on the ball. Too many times of late we have seen Banks headed by "bankers" that should not be bankers. When the going gets tough, the tough need to get going, and they need to know where they are going and why.
In 2009, we said goodbye to some of our clients and some bankers that we have known for years and years. A sad time.
Let's see what 2010 will bring...
Ruth L. Razook, CEO
DID YOU KNOW?Due Diligence
Mergers & Acquisitions
If your Institution requires assistancewith the Due Diligence Process or with supporting a Merger or Acquisition, we can help. Please contact John Neely, Executive Vice President of Sales and Marketing at john.neely@rlrmgmt.com, or send your inquiry to info@rlrmgmt.com.
You have heard it from us before: We don't have a crystal ball. So, why write an article about what we think will happen in 2010? Well, (if nothing else) it is fun to speculate, and quite honestly if what we say happens, we will be geniuses--and if it does not happen, no crystal ball!
So, let's start with the fun stuff...The Lakers repeat as NBA Champs, knocking off the hated Boston Celtics in 6 games. Once again, Kobe winns the MVP of the NBA Finals, but in a surprise, loses to Kevin Durant of the Oklahoma City Thunder for the League MVP title.
Brett Favre retires (again, again) after their playoff loss to the World Champion New Orleans Saints, and in the baseball world...well, who cares! And of course, no speculation whatsoever on Tiger Woods.
A few things we know for sure: It will snow at the Winter Olympics; it will rain in the Pacific Northwest; the sun will shine in Hawaii; here in the Desert, we will have another 120 days of dry heat; and the LA Clippers will not make the playoffs.
Now that we have squared that away, what do we predict for business? First, we believe that many of our clients will need assistance with their mergers and acquisitions in 2010. We believe this may be the single most requested service in 2010. 47 institutions were absorbed by mergers in 2009, and we anticipate that number increasing by 20% in the U.S. in 2010. We will see new players enter the acquisition trail from the investment banking and private sector world.
There will be a huge push to raise capital by many Community Banks. We believe there continues to be a large amount of money and investors sitting on the sidelines looking for such opportunities and believe many of our well-run Community Banks will be successful in this effort. 
Asset quality will continue to be heavily scrutinized in 2010. We foresee a high demand for our loan service offerings in the coming year, with heavy emphasis on loan reviews, liquidity reviews, and audit-related services.
We believe new technology spending will lag in 2010, yielding to a great emphasis of getting one's house in order through cost reduction and efficiency programs. In conjunction with this, we expect an upswing in training and retention of quality staff.
From a regulatory standpoint, we do not trust things will ease up. Examinations will be tough and thorough. There will continue to be a huge emphasis on credit quality and risk management. Standalone Remote Deposit Capture audits will be looked upon as a critical component of overall operations audit requirements.
We predict a fairly steady economy which, as most believe, will pick up steam in the 3rd quarter of the year. Unemployment will continue to hover around the 10% mark for the majority of the year. In general, we envision a year of flat to very modest growth - essentially a year of steadying the course, creating opportunity where opportunity does not require significant risk, and a year in banking of consolidation and correction that will level-set the industry for a bright future in the coming years.
Mitch Razook, President and COO
About a month ago, I broke a golden rule of mine, which is "you better be dead or in the hospital if you are not at work". I agree, I've missed showing up at the office through knee surgeries, but was always working. Well, the Friday morning came about a month ago when I had to say, "I cannot even think about getting out of bed." , and I stayed in bed the entire day. About 5pm, I took my temperature and it was 104 degrees. YIKES! Stay calm, stay cool, you can beat this. By Monday, after basically sleeping every hour Saturday and Sunday (I think I ate some crackers), I went to the doctor. Immediately, she said, "I am sure you have the H1N1 virus, and we will treat you that way, until we know differently." "Treating that way" meant antibiotics (major doses), Tamiflu, and for me, ear drops because the virus had taken over and infected an ear. She gave me a mask to wear and told me to wear it any time I was around any one, for fear I was contagious.
Mitch and I learned a few things through this ordeal that we thought we would share:
We just all need to be safe, sound, happy, and healthy. Hope some of this info helps!!!
Ruth L. Razook, CEO
As we our feature of highlighting our professionals, in this issue we highlight three of our most senior consultants: Nancy Cook, Darlene Sessions, and Brian Van Dyk.
Nancy Cook has been with RLR for almost four years, having come to us by way of Countrywide Bank, Wachovia Bank, and earlier in her career, Sanwa Bank of California. Nancy and Mitch Razook first met at Sanwa Bank California where they shared management responsibility for Cash Management Products and Services. In subsequent years Mitch and Nancy kept in touch while Nancy was building her career at First Union Bank and Wachovia Bank in Charlotte. Nancy made her way back to Los Angeles and actually ran into Ruth during her short stay at a community bank in the LA area. Soon after, Nancy joined Countrywide Bank. At that time Mitch had just joined RLR. Nancy was looking for some consulting assistance and RLR was able to foot the bill. Several years later, Nancy joined RLR and has kept very busy managing several large projects for a number of our biggest clients.
Nancy has over 30 years of experience in management for financial institutions. She has managed projects for internet banking, cash management product development, bank mergers, and customer product conversions from a business perspective. Her experience in the financial services industry includes operational and treasury services management for two of the top five banks in the country as well as community and De Novo institutions in California. Her expertise is in cash management product development and project management where she has managed numerous projects from $5 million to $40 million, with project teams up to 40 people.Nancy has successfully managed large product management organizations, created and managed a new commercial banking product organization for a large financial institution, which included developing policies, procedures, staffing models and implementation of new products. In addition, she has led on-line product development merger teams for three mergers, managed all customer related customization for the on-line products, and created and managed a new department for statistical reporting, market research, and management reporting for a large national bank. In addition to the large and complex projects Nancy has managed during her time with RLR, she has also worked with clients defining and implementing operational efficiencies, integrating systems, products, policies and procedures for merged organizations, and leads RLR’s Cash Management and Correspondent Banking practices. Nancy holds a B.A. from the University of Redlands; has completed software courses that include Microsoft Office applications and MS Project, and was accredited as a Certified Cash Manager (CCM) by the Association for Financial Professionals.
Nancy currently resides in Northridge, California.
Darlene Sessions joined RLR over eleven years ago. Darlene has over 30 years of experience in financial institutions and consulting. Darlene’s focus and expertise is in technology, operations and compliance where she has led countless RLR consulting engagements.
Darlene’s experience in the financial services industry includes management of operations for a $3 billion Bank, and management of institutional trust services for correspondent relationships at a very large Financial Institution, servicing over 750,000 accounts.
Darlene is an integral part of RLR’s operations compliance team, and has conducted numerous compliance and control reviews including recommendations for compliance and control improvements to meet regulatory mandates. She has successfully managed projects related to bank wide system conversions, application conversions, product implementations, branch acquisitions and sales, new branch installations, workflow analysis and process improvement, and fee revenue enhancement.
As Director of Operations for a large southern California Bank, Darlene had direct responsibility for branch operations, deposit products, electronic funds transfers (ACH, ATM), credit and debit card processing, consumer lending and automated underwriting, cash management services, item processing and reconciliation, retirement accounts, correspondent services, offsite merchant and ATM processing, cash vault services, safe deposit box processing, and branch training and support. Darlene served as a member of the Information Technology Steering Committee, Compliance Committee, and Business Continuity Planning Committee of a large financial institution, with direct responsibility for development of operational controls, staff training, and operational policies and procedures.
Darlene holds a Certificate of Merit from the Institute of Financial Education, completed the School for Executive Development at the University of Georgia and the Leadership Program at the University of Southern California.
Darlene currently resides with her husband Tom in Upland, CA.
Brian Van Dyk has been with RLR for almost five years. Prior to joining RLR, Brian had over 20 years of executive management experience in financial institutions and the technology companies that support them. Brian has led financial institution projects and initiatives throughout the United States in technology, operations and contract negotiations.
His experience in the financial services industry includes the management of the relationships and core data and item processing operations for over 120 community banks ranging from De Novo to over $6 Billion in assets across the United States including the ITI Premier Core Banking system, retail internet banking, telephone banking, cash management, teller processing, new account platform, document management, and business intelligence. Brian was also responsible for providing services associated with check imaging to over 100 institutions across the United States.
Brian has worked with many of RLR’s clients and many of our vendor partners in leading Requests for Proposal (RFP) formation and presentment to ensure that all critical bank needs are addressed. Brian is highly experienced in conducting detailed analysis and evaluation of Vendor RFP responses and service and pricing proposals and reviewing and negotiating vendor contracts to ensure best pricing and service alternatives for our clients.
Brian is one of our resident experts regarding the major banking core and check image processing software applications and vendors that offer services to Community Banks.
Brian’s additional areas of expertise include formulating comprehensive technology plans, high-level project management oversight of large scale projects such as core system conversions, internet banking system conversions, and branch or bank acquisitions or consolidations, and project leadership in numerous areas of bank operations including branch operations, deposit operations, loan operations, electronic banking, and cash management.
Brian holds a Bachelors degree in Business Finance from Montana State University as well as numerous certificates in the fields of banking, technology and management. In addition, Brian serves as Board Secretary and Co-Treasurer of Agape International Missions and the Agape Restoration Center, a mission to Cambodia.
Brian currently resides with his wife, Trudy, and family in the Sacramento area.
Ruth Razook, CEO
WIB Technology Peer Exchange Conference Call Series:
Register online at www.wib.org
RDC Compliance, Exams/Audits
Audit Programs for the Banks
Identity Theft Compliance, Exams/Audits
Enterprise Risk Management
Expanding technology with Facebook, Twitter, etc.
Topics for Discussion TBD
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Ruth Razook, CEO:
Mitch Razook, President & COO:
John Neely, EVP, Sales & Marketing:
Cathi Wickham, SVP:
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