BankWise November 8, 2018

“Credit unions are non-profits.” – A Minnesota Lawmaker.

Minnesota sees a "Blue Wave"

Story:

While a “blue wave” didn’t sweep the country at the federal level as some predicted, Democrats in Minnesota secured all but the Senate on election day.

What changed?

Both incumbent Democratic U.S. Senators handily won reelection. Five-term U.S. Rep. Erik Paulsen (District 3 – Plymouth, Eden Prairie and Rogers) lost to Democrat Dean Phillips by a wide margin.
 
Freshman U.S. Rep. Jason Lewis (District 2 – Belle Plaine, Prior Lake, Northfield, Red Wing and Wabasha) also lost his rematch with DFL challenger Angie Craig.
 
With a strong showing in the metro area, Democrats ran the table on statewide races. Democrat Tim Walz defeated Republican Jeff Johnson by 12 percentage points. Democrats also won all other statewide races, including the cliffhanger attorney general race between Democrat Keith Ellison and Republican Doug Wardlow.
 
These victories were accompanied by success throughout the suburbs for Democrats at the state legislative level. House Republicans held a 77-57 majority going into this election. DFLers now control the Minnesota House in the next biennium, having picked up 18 seats. The “Hillary 12” districts made up the majority of the swing districts for Minnesota House.
 
Get more details on these races and on Republican victories on the ICBM website.

From ICBM:

While ICBM’s experience is that both Republicans and Democrats support small, local, community banks, Democrats have sought historically to promote the public good through more regulation and consumer protection.
 
“Our focus will be to educate new lawmakers – as well as those who looking to expand regulations – about community banks and the unique value they bring to their communities,” said ICBM President and CEO Jim Amundson. “Our members should not have their regulatory burdens increased by new regulations meant to keep the nationwide banks in check.”
 
Minnesota’s new Attorney General, Democrat Keith Ellison, has also described himself as a “champion” on issues like fair housing, student loans, and predatory lending.
 
While Ellison’s goals are laudable, ICBM will engage on behalf of its members to ensure any new rules proposed have all stakeholders in mind, Amundson said.

ICBA goes ‘pedal to the metal’ on fintech accelerator

Community banks, known for being responsive to their customers and adaptive to changing market forces, have struggled to incorporate innovative digital technologies that today’s bank customers demand. Everyone wants a digital wallet, right? (And everyone wants it to be free.)
 
Core technology providers catch the blame for not innovating fast enough, putting community banks — which don’t have the resources to develop software solutions internally like the nation’s largest banks — at a competitive disadvantage. Historically, core technology companies have been software providers, not developers.
 
Banks looking for innovative solutions for their customers often turn to third-party developers, yet getting those products integrated with their core system can be complex and costly. Negotiating changes to core contracts to build in innovation increasingly means onerous fees, contentious contract negotiations, and damaged relationships. “Community banks feel like they’ve been held hostage a little bit in not being able to innovate fast enough,” Kevin Tweddle, vice president of innovation and financial technology at the ICBA, told the American Banker.
 
Blaming doesn’t move the needle on innovation, however. Investment does. Just last week, the ICBA announced a new partnership with The Venture Center of Little Rock, Ark., in order to launch the ICBA ThinkTech Accelerator. “This first-of-its-kind accelerator will help community banks directly engage fintech companies focusing exclusively on community bank product development and solutions,” said ICBA’s President and CEO Rebeca Romero Rainey.
 
Through its new partnership, ICBA will invest in eight to 10 promising fintech companies engaged in developing tech solutions to streamline the customer experience, build next-gen lending products, improve cybersecurity, tackle payments issues or reg compliance, and give banks a boost in data analytics.
 
At its core, the ThinkTech Accelerator is collaborative, and it has the potential to create fintech products tailored for community banks. “We have the ability to impact the industry and develop relevance for our industry instead of waiting for the right solution to come along,” Tweedle told the American Banker. In other words, community bankers just took control of the car that will drive innovation.

Faces and Places

  • Congratulations to Star Bank’s Katie Incantalupo, vice president of marketing and human resources, for being named an Outstanding Woman in Banking by BankBeat magazine. While you might know Incantalupo, who works in Star Bank’s Eden Prairie office, from her early work in the Mighty Ducks and Grumpy Old Men films, you might not know her other notable role: she’s the daughter of ICBM’s 2015-16 chair Harry Wahlquist.
 
  • Fourth gen-banker McKinzie Hopkins joins the Twin Cities team of CorTrust Minnesota as vice president. Hopkins is an attorney and tax manager who formerly worked at Deloitte.
 
  • ICBM has created a free, downloadable flyer to help rural bankers spread the word about the Minnesota Department of Agriculture’s free, confidential 24-hour mental health hotline. We encourage you to print and display the flyer prominently in public areas of your bank.  

MARK YOUR CALENDAR

Save the Date

April 24, 2019

Save the Date

February 21, 2019

Agriculture (AgLink)

The USDA announced it will begin making direct aid payments to farmers affected by trade disputes through the Market Facilitation Program, announced in August. Farmers interested in aid payments must register with the USDA by Jan. 15.
 
Once an aid application is complete, farmers must wait until harvest is complete, then verify their yields in a fashion similar to what is required by FSA or federal crop insurance programs. The aid program rates vary by crop, with soybeans qualifying for the greatest payout ($1.65 per bushel) while corn producers will get only $0.01 per bushel. Hog producers will be paid on a per head basis.
 
Farmers have lost upwards of 90 percent of the soybean market, which led Secretary of Agriculture Sonny Perdue to admit that this aid program “will not make farmers financially whole.” As producers come into the bank to negotiate next year’s operating loans, it will be important that everyone understands this aid program is a one-off. Crop and livestock producers will have to adjust their 2019 production plans to reflect changes in the market.
 
Also, crop insurance harvest and revenue protection prices have been finalized for the season.
 
We’ve got the full rundown for you.

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