NBA chairman: Banking should be customer centric

The 217 bankers who gathered for the Nebraska Bankers Association's 123rd annual convention welcomed John Stinner as 2013-2014 chairman of the association. Stinner, who is president of Valley Bank & Trust Co., Scottsbluff, Neb., accepted the gavel from Clark Lehr, president of First Nebraska Bank, Columbus, at the Embassy Suites in La Vista, a suburb of Omaha, Neb., on May 3..Stinner said he will speak out on the importance of ethics in business. In additional, he will work to fight the growing regulatory burden of the banking industry.."My dad probably had the most significant impact on who I am today. He was part of the group we now refer to as the 'greatest generation,'" Stinner said. A drill sergeant and veteran of the Second World War, Stinner's father had two core principles. "Always tell the truth — even if it hurts. And, always do the right thing — even when no one is looking," he said.."It's pretty evident from reading the newspapers these days that not everyone grew up like I did," Stinner observed. "The news has been full of failures in ethics. The most recent and vivid example was the mortgage crisis." Citing examples of publicly traded companies that aggregated bad loans into mortgage pools, Stinner expressed surprise that the large, non-bank companies were allowed to take such risks. ."Now we have Dodd-Frank, which Congress feels will fix our banking system," Stinner said. "And with the weight of the new rules our banking culture is moving from customer-centric to regulatory-centric.".Stinner said it now becomes the responsibility of Nebraska bankers to protect the integrity of community banking. "Nebraska bankers understand the same lessons my dad taught me – you and I appreciate the importance of infusing ethics and integrity throughout our organizations, of working hard, of helping our customers realize their dreams," Stinner said. "Now, consider how you might contribute to the success of our industry."."You might take ABA Chairman Matt Williams' approach," Stinner suggested. "Invite regulators and legislators to your bank. Educate them on the differences between community banking and big investment banking. Write letters to your regulators. Last summer 2,500 bankers wrote personalized letters regarding the negative impact of Basel III; it certainly caused regulators to pause.".Stinner hopes these efforts will bring some respite from the onslaught of new rules. "We need a pause," he said. "Right now, an executive at any kind of company just cannot create a business plan for five years out. In banking, look at the mortgage industry; what are banks going to do in that industry? It's nearly impossible as a corporate planner to figure out how to serve our community's mortgage needs with the CFPB writing new rules every month.".Bankers have the most hope to overcome their challenges if they collaborate with their peers, Stinner said. "No matter how big the bank, there are always issues," said the new NBA chairman, recollecting the banks of various size he has managed. "We can see it through with each others' help," he said. .Stinner pointed to The Basel III Commonsense Approach for Small Entities Act (S. 731) which was introduced in the Senate on April 16 as a possible source of regulatory relief. A bill that would require federal banking regulators to study the impact of their Basel III proposals on community institutions, Stinner said a study of the international capital requirements for small banks could provide industry advocates the ammunition they need to secure an exemption for community banks.