Home Loan Bank membership active in Des Moines district

Northwestern Financial Review, Mar 15, 2001 by Bengtson, Tom

Pat Conway, president of the Federal Home Loan Bank of Des Moines, told Minnesota bankers Feb. 14 that banks using Home Loan Bank advances are lending more than other banks. Banks that are members of the Federal Home Loan Bank have an average loan to deposit ratio of 95 percent, he said, compared to non-members who average 76 percent.

Most of the banks in the Des Moines district are members. Conway said the Des Moines bank now has more members than any of the other 11 Home Loan Banks. Membership is now at 1,225 banks, leaving only about 500 banks that are not members. "One of the really exciting things is that about 75 percent of our members actually borrow from us," Conway said. In other districts, only about 60 percent of the Home Loan Bank members use their lines of credit. With 75 percent of its members borrowing, the Des Moines district has the most active membership in the country.

The membership increase cannot be attributed to any marketing efforts by the Des Moines bank, Conway said. Word of mouth is really the key, he said, as "new members are selling the system to other bankers." In 2000, membership grew by 100 banks and Conway expects another 100 banks to join in 2001.

Conway, who joined the Des Moines bank as president last year after serving for many years with the San Francisco Home Loan Bank, said he likes the Midwest. "On the West Coast, things are dominated by large institutions," he said. "The branching laws are much different. In the Midwest most communities actually have their own community bank. I like that."

Wisconsin bankers are likely to face many of the same issues during the 2001-2002 legislative session that they faced during the 1999-2000 session, according to Martin Frank, president-elect of the Wisconsin Bankers Association and president of Waukesha State Bank. Speaking at the WBA Group One Meeting Feb. 17 in Minneapolis, Frank said the following issues are likely to surface: ATM surcharge ban, removing ATMs from the computer tax exemption, giving wage liens "super" priority, and various new privacy-related regulatory requirements.

Frank told bankers that WBA is one of the best lobbying organizations in Madison. He cited statistics from the State Ethics Board which show WBA to rank 19th out of 592 lobbying organizations in total lobbying hours.

WBA immediate past president Willard Ogren of Security State Bank in Iron River, told bankers the association raised $148,230 for its state political action committee. The money came from 1,530 individuals. Of those, 844 gave $75 or more. Last year, the PAC disbursed $203,327 to candidates, while a record $288,720 was raised for the 1999-2000 election cycle. WBA's PAC fundraising goal for 2001 is $150,000.

WBA is embarking on a unique educational effort to better prepare bankers to comply with fair lending laws. The association worked out a deal with the Federal Deposit Insurance Corp. to have the same experts who train their examiners to offer a fair lending compliance seminar to bankers. The FDIC first baulked at the idea when contacted by the WBA, Frank told colleagues at the Group One meeting. "When we asked them why they couldn't provide us with the same training they were giving their examiners, they said they didn't know and would get back to us," Frank explained. "Ultimately they decided to work with us on this. We'll be getting the exact same training that their own examiners get." The seminar, which is set for May 2-4 in Wisconsin Dells, is designed to help bankers plan for their next fair lending examination, and help bankers conduct their own audits for fair lending compliance in their banks.

WBA also took the opportunity at the Group One meeting to clarify the schedule for its two most significant meetings. The WBA annual meeting will take place June 25-27 at the Madison Hilton Hotel and Monona Terrace Convention Center. It is the first time in WBA's 109-year history the convention will be in Madison. In 2002, the annual meeting and the association's executive seminar will be combined and held Feb. 6-8 at the Concourse Hotel in Madison. In 2000, the association skipped its annual convention for the first time in its history, scheduling it into its executive seminar. In 1999, the WBA conducted a joint convention with the Minnesota Bankers Association in Minneapolis.