Community Banking

Celebrate Fall

Fall has always been my favorite season. The time when everything bursts with its last beauty, as if nature had been saving up all year for the grand finale.  Lauren Destefano

Although it may not feel like fall in the Sunshine State, there
are still many wonderful ways to celebrate the season. From activities like apple
picking and attempting a corn maze to attending the many festivals around the
state, fall presents lots of fun activities for the whole family.

Here are a few fun ideas sure to make long-lasting memories:

  1. Go Apple
    Picking
    – Apple picking is a great way to get fresh produce and enjoy the
    beautiful fall weather as well as a wonderful learning opportunity for young kids.
    You can show them how to properly pick apples from the tree and give them the
    chance to try different varieties of apples to determine which ones they like
    best. Google Florida U-Pick Apple Orchards for a list of
    orchards near you.
  2. Visit
    a Pumpkin Patch
    – One very popular family fall activity is visiting a
    pumpkin patch. Like apple farms, pumpkin patches typically have other fun
    activities as well like hay rides and maybe even a petting zoo. Google Florida Pumpkin Patches for one near
    you.
  3. Attempt
    a Corn Maze
    This is a great
    family activity because it gives your family the opportunity to work together,
    deciding which ways you should go. Some mazes can be difficult, and it provides
    a great feeling of achievement when you make it to the end. Google Florida Corn Mazes for one near you.
  4. Bake
    a Pie
    – The holiday season is just around the corner, so fall is the
    perfect time to try your hand at making a pie. There’s some work involved in
    making a pie from scratch so make it a family affair. Find a great apple and/or
    pumpkin pie recipe and start baking and creating fun family memories!
  5. Make
    Caramel Apples and Roast Pumpkin Seeds

    This a wonderful and delicious way to make use of the apples you’ve picked
    from your apple orchard trip and pumpkin you’ve brought back from your pumpkin
    patch visit.
  6. Collect
    Leaves and Acorns and Do a Fall Craft
    –The colorful leaves and acorns that drop from the trees are one of the best
    things about fall. They are great for DIY projects and decorating your home.
  7. Enjoy a
    Fall Festival
    – What Florida lacks in colorful foliage, it more than makes
    up for in fun and entertaining fall festivals. 

North Central Florida Peanut Festival – Fun, food, games,
entertainment as well as a competition for girls and boys for Little Peanut
King and Queen. October 5 at Heritage Park in Williston.

Winter Park Autumn Art Festival – Artworks by over a hundred
artists as well as musical entertainment, food and children’s activities.
October 12 to 13 at Central Park, located along Park Avenue in downtown Winter
Park.

Rattlesnake Music Festival – Features snake shows, entertainment,
food, arts and crafts…and even gopher races. October 18 to 20 at the Pasco
County Fairgrounds.

Fantasy Fest in Key West – Non-stop activities including parades,
masquerades, street parties and more. October 18 to 27.

McIntosh 1890’s Festival – Residents dressed in 1890’s attire and
Victorian and Florida cracker-style homes surrounded by century-old oak trees
make this the perfect backdrop for going back in time. This festival also
includes arts and craft booths as well as delicacies from many food concession
stands. October 26 along Highway 441 between Gainesville and Ocala.

Florida Seafood Festival in Apalachicola – Sample delicious seafood
and enjoy arts and craft exhibits and fish-related events and displays. November
1 to 2 in Battery Park in downtown Apalachicola.

Micanopy Fall Harvest Festival – Live music, an auction and over
200 displays of works from local and southeast artists. November 2 to 3, just
off Highway 441, 12 miles south of Gainesville

Riverhawk Music Festival – Live entertainment on three stages,
all-day kids programs, song contests, great food and craft brews, and camping
in the woods. November 7 to 10 at the Sertoma Youth Ranch in Brooksville.

Epcot International Food & Wine Festival – Sample world-class
foods and wines. Enjoy live music, cooking events as well as meet and greets
with celebrity chefs. August 29 to November 23 at Epcot World Showcase.

Helping Your Child Establish Credit

Preparing your child for adulthood is daunting. As a parent, no matter how old your child becomes, worrying about their health and safety will always remain in the forefront. However, as they begin to mature into young adults, their financial future becomes a growing concern.  Often overlooked, and yet, equally as important as helping your child choose a career path that is right for them, is helping your child establish credit.  

Here are a few tips to help you begin building credit for
your kids.

First and foremost, begin the “money talk” with your kids
while they are young. You should begin discussing basic financial concepts like
saving (help them open a savings account) and delayed gratification when they
are in elementary school. As they get older, introduce more complex concepts,
such as insurance, investing, credit cards and borrowing, and explain what
credit really means – the building blocks of consumer credit – and why it’s so
important. As a responsible parent, you should also make sure your credit
habits provide a good example.

In addition to providing a good financial
education…foundation, the following steps will help ensure your young, adult
child is well on his or her way by the time they are flying solo.

  1. Help them
    open a checking account.
    Show your child how a checking account works as
    well as the penalties associated with them if they overdraw their account or
    bounce checks. Once they understand and are comfortable with the basics, ease
    them into a debit card. This gives them some spending independence, while
    limiting it to the balance in their checking account.

  • Have
    them get a part-time job.
    A strong work ethic is a vital part of your child
    becoming a responsible adult. Having a part-time job in high school provides them
    with a valuable life lesson – the excitement of watching their savings grow and
    the frustration of seeing it disappear, especially if it’s due to a poor
    decision. This lesson is a precursor to understanding credit. In addition, the
    income provided by a part-time job will help them when they apply for their own
    credit card.

  • Add
    them as an authorized user on your credit card.
     As long as your own credit habits are sound,
    this is a good way to help your child establish his or her own credit record.  As an authorized user, your teen will usually
    get a credit card in his or her name, tied to your account. Typically, this
    account will also go on your child’s credit record.By setting ground rules for what they can charge and how and when
    (on-time) payments will be made, you will enhance your child’s understanding of
    how credit works as well as help their credit grow.

You can also add them as an authorized user without
giving them access to the account. Without giving them the possibility…opportunity
of overspending, you can still help them grow their credit as you use the
credit card and pay it off every month.

  • Have
    your college-aged child apply for a student credit card.
    Once your late
    teen has established good financial habits and income to support a credit line (usually
    income from a part-time job is sufficient), they may be ready to apply for
    their own credit card. These cards typically have lower credit limits and
    higher interest rates than general credit cards.

  • Help
    your college-aged child apply for a secured credit card.
    This is another
    option if your young, adult child is unable to get a student credit card. A
    secured credit card requires the cardholder to put down a deposit, typically a
    few hundred dollars, which is usually the credit limit they are given. Because
    there is little risk to the bank/credit card company with this type of card,
    most people can get approved.

What Does the Federal Reserve’s Recent Rate Reduction Mean to You?

The recent interest rate reduction, from 2.5 percent to 2.25 percent, by the Federal Reserve doesn’t directly touch any of the everyday interest rates that affect Americans. This quarter-point cut, the first cut in a decade, reduced the federal funds rate, the rate banks and other financial institutions charge one another for very short-term borrowing.

Even though most Americans don’t participate in this type of
borrowing, the Fed’s move will still have consequences on the borrowing and
saving rates you encounter every day.

Interest rates on car loans, credit card balances,
mortgages, etc., and earned interest on the money you save won’t necessarily be
directly or immediately impacted. But, consumers could, likely, over time, experience
the following trickle-down effects.

Savings Account Rates

Savers have only recently benefited from higher deposit
rates – the annual percentage yield banks pay consumers on their money – with
several online banks offering over 2.5 percent. However, the recent rate cut
will most likely cause these rates to come down.  Now is the time for consumers to shop around
for short-term rates or lock in rates with a 1-, 3- or 5-year certificate of
deposit with money that doesn’t need to be readily accessible.

Mortgage Rates

According to Bankrate, the current 30-year fixed mortgage
rate is about 3.93 percent, the lowest it’s been since November 2016. Because
mortgage rates are tied to long-term rates, which move well in advance of any
rate changes by the Fed, the current low rate came on the heels of the
expectation that the Fed was going to cut rates.  Consequently, unless the Fed hints that more
rate cuts are on the horizon, mortgage rates are not expected to fall much
more.

With that said, if you borrowed money to purchase a home
late last year, when the average 30-year mortgage rate was nearly 5 percent, it
may be time to consider refinancing.

Credit Card Interest
Rates

The Fed’s recent rate reduction is good news for Americans
who carry balances on their credit cards. Because most credit cards have
variable interest rates, there is a direct correlation to the Fed’s benchmark
rate.

With the rate cut, the prime rate lowers too, and credit
card rates will likely follow. For credit cardholders, this means you should
see a reduction in your annual percentage yield or APR (the current rates on
average are as high as 17.85 percent) within a couple of billing cycles.

With almost half of all credit cardholders in the U.S.
holding balances every month, averaging approximately $1,150 in interest
yearly, this quarter-point reduction will create some savings.

Auto Loan Rates

For those of you who are planning to purchase a new vehicle,
the Fed’s rate reduction will most likely have little impact on your car
payment. However, this rate cut lowers the financing costs for car manufacturers
and dealers, which can offer a better negotiating position for the would-be car
buyer.

Student Loan Rates

While most student loans are fixed-rate federal loans,
approximately 1.4 million students in the U.S. today use private student loans.
Private loans can be fixed or have a variable rate tied to the Libor, prime or T-bill
rates. Consequently, the Fed’s rate cut means borrowers with variable rate loans
will likely pay less interest. If you have private, variable rate loans, you
should look into refinancing to possibly lock in a lower fixed rate.

However, as borrowers begin to celebrate this recent rate
cut, retirees have begun to worry. This type of rate reduction doesn’t bode
well for returns on investments preferred by those who’ve left or have
immediate plans to leave the workforce.

Typically, yields on fixed annuities, CDs, savings accounts
and bonds go down with a Fed rate cut. Long-term care premiums and pensions
will also be pinched. The impact will likely not be felt immediately. Retirees’
portfolios may not feel a hit for more than a year.

Investment professionals warn retirees not to chase returns
in the market, possibly placing more emphasis in their portfolio on investments
like equities and real estate, which might not be safe for those who have a lot
more to lose and generally can’t afford to take on much risk. With any rate
fluctuation, it’s important to work with your financial advisor or planner to
develop a portfolio that’s right for your situation.

Although the Federal Reserve’s recent rate cut can be viewed
as both a good thing and a bad thing, the same as any rate increase, the
guiding force behind the reduction is heading off a recession. With this move,
the Fed hopes to prevent the economy from weakening and forestall layoffs and
other economic damages that could adversely affect everyone.

Trade School or College?

By the end of the 1950s, the focus of education in the United States shifted from vocational and job-ready skills to preparing all high school students, through college prep courses, for college. However, today, statistics indicate that the highly coveted bachelor’s degree doesn’t seem to carry the weight it once did.

The latest figures from the U.S. Bureau of Labor Statistics (BLS) indicate that approximately 68 percent of high school students attend college. The remaining students graduate with neither academic nor job-ready skills. But even the 68 percent aren’t fairing that well. Almost 40 percent of these students, as low as 10 percent for those in poverty, don’t complete a four-year college program, wasting a lot of time and money, and often acquiring significant student debt. Of those students who do graduate, the BLS found that about 37 percent end up with jobs they could’ve obtained with a high school degree.

In the United States, a college degree has been viewed as the pathway to success, and it still is for many. Earnings studies do show that college graduates earn more over their lifetime than high school graduates. However, these studies don’t take into account the amount of debt these students take on in pursuit of higher education (the outstanding student debt balance in the U.S. was $1.5 trillion as of 2018, according to the Federal Reserve) nor that more than half of recent college graduates are unemployed or underemployed. In addition, these studies don’t include data on those high school students who graduated with vocational training. These graduates have gone on to well-paying, skilled jobs, creating a rosier picture for them than many of their college graduate counterparts.

The U.S. economy has changed. The manufacturing sector is growing and modernizing. This, along with the demise of vocational education in high school and retiring baby boomer, skilled trades workers, has created, and will continue to create, a significant demand for skilled labor. The skills shortage in manufacturing today has created a wealth of opportunities for high school and unemployed and underemployed graduates alike. Many of these jobs are attainable through apprenticeships, on-the-job training, and vocational programs offered at community colleges.

Even with the above statistics aside, the traditional 4-year degree isn’t for everyone. People have a diverse range of skills and learning styles. Some do best in a lecture hall or classroom, studying math, biology, history and other traditional subjects, while others learn best by doing, and would thrive in a studio, workshop or shop floor.

There are still many advantages to a 4-year degree. As stated before, most college graduates will earn more money over their lifetime, especially if they continue their studies through master’s or doctoral degrees. However, the cost/benefit equation to higher education is changing every day. The education system needs to recognize this and that vocational schools can offer students with valuable skills, resulting in competitive paying jobs and a secure financial future. Students need to be exposed to the possibility of vocational training as an alternative to the college degree, helping both them and their parents see a variety of paths to a successful future.

Nurturing the Entrepreneurial Spirit in the Workplace

Many employees have fantasized about being their own boss.
But, they typically don’t act on it because of the responsibility and/or risk associated
with owning and running a company. This doesn’t mean, however, these employees
don’t harbor the entrepreneurial traits, which if nurtured, could take the
organization to a whole new level of success.

As businesses strive for increased competitiveness, creating
an entrepreneurial culture has become an important advantage.  In today’s business environment, the term
entrepreneurial means more than just the business intelligence required to turn
an idea into an enterprise. It’s a skill or mindset embodying innovation,
creativity, calculated risk-taking and empowerment. It’s the responsibility of leaders
to identify, tap into and cultivate these traits within their organization.

Sometimes referred to as an “intrapreneur” (entrepreneurs
working within a company), these employees can be identified by the following
traits:

  1. Creativity
    – Innovation stems from creativity. This drives the company forward.
    Intrapreneurs change the status quo and notice opportunities.

  • Long-term
    focus
    – A person who is creative and innovative must also be focused,
    otherwise they will fleet from one shiny object…new idea to another. The
    intrapreneur can identify what adds value to the company and what doesn’t.

  • Team
    player
    – Naturally, teamwork is essential in a business. Yet, it’s the
    ability to realize that sometimes others have to take control that makes the
    intrapreneur standout in the company.

  • Risk-taker
    – Playing it safe in today’s world will get you nowhere. Intrapreneurs aren’t risk
    adverse.

  • Results
    oriented
    – The intrapreneur is more concerned about the results than the process.

  • Take
    responsibility
    – The intrapreneur takes ownership of his or her successes
    as well as his or her failures.

  • Adaptable
    – The business landscape is continually changing. The intrapreneur is very
    flexible to change and can quickly adapt, especially in high-pressure
    situations.

  • Planners
    – Intrapreneurs develop a plan and then work the plan.

  • Effective
    – Intrapreneurs are more interested in how effective each task or activity
    is as opposed to concentrating solely on efficiency.

Once a company leader recognizes the intrapreneurs in
his/her organization, he or she must take the next steps to cultivate these
traits.

Create an environment
of empowerment

It’s a business leader’s actions that create an environment
of empowerment. It’s his or her leadership style. Research shows that
leadership based on relationships increases the entrepreneurial spirit of the
company as opposed to task oriented leadership style. An effective leader leads
by example.

Encourage innovation

Innovation keeps a company competitive and growing. In large
companies with layers of management, the innovative spirit can often get lost.
Leaders must welcome, encourage and reward innovative thinking in the
workplace.

Welcome internal
competition

Competition amongst co-workers, if handled correctly, can
spur incentive and innovation. Healthy competition can drive co-workers to push
one another to be more productive and produce better work.

Communicate

Communication is a fundamental function of good leadership.
Leaders often get so caught up in the day-to-day operations of the business
that they forget to tell their staff where they are going – the company’s
vision and direction. Employees want to get the important information. They
also want to know that their concerns and ideas are being heard. Leaders must
continually communicate to their staff that the entrepreneurial approach is
valued, encouraged and rewarded.

Community Bank…More than Just a Name

IntraLogoTMThe recession and subsequent financial fallout put a negative spotlight on “big banks.” This increased the popularity… attractiveness of the community bank.

Many local banks today refer to and market themselves as “community” banks. But, are they really?

What does it mean to be a true community bank? The definition is two-fold – the FDIC’s size, asset-based definition as well as the bank’s behavioral characteristics, how and where it conducts business. Both attributes must be taken into account to determine whether a bank truly is a community bank.

FDIC’s Community Bank Definition

An institution that has less than $1 billion in assets is a community bank if it:

At year-end, does not have an asset concentration exceeding 50% of total assets in non-community specialty banks, including:

  • credit card specialists,
  • consumer nonbank banks
  • industrial loan companies,
  • trust companies, and/or
  • bankers’ banks; and holds less than 10% of its assets in foreign assets.

A bank that has assets of $1 billion or greater is a community bank if it:

At year-end, does not have an asset concentration exceeding 50% of total assets in non-community specialty banks, including:

  • credit card specialists,
  • consumer nonbank banks
  • industrial loan companies,
  • trust companies, and/or
  • bankers’ banks; and holds less than 10% of its assets in foreign assets;
  • Has a ratio of core deposits to assets greater than 50%
  • Has a ratio of loans to assets that exceed 33%
  • Has no single branch office that exceeds the branch maximum deposit limit of $5 billion
  • Has no more than 75 bank offices
  • Operates in no more than two large metropolitan statistical areas (MSA), defined as an MSA with a population of more than 500,000
  • Operates in no more than three states

Behavioral Characteristics of a Community Bank

Community banks focus on providing traditional banking services to the community in which they operate. A community bank obtains most of their core deposits and makes most of their loans, residential and commercial, locally. For this reason, community banks are often considered to be “relationship” bankers as opposed to “transactional” bankers.

A community bank, typically privately owned, locally controlled and with employees often residing in the community they serve, has specialized knowledge of their local community and their customers. This expertise allows them to base credit decisions on local knowledge and nonstandard data derived from long-term relationships with their customers. Community banks are less likely to rely on the standard underwriting models used by big banks.

This relationship approach to lending is particularly important to a community’s small businesses. Small businesses, especially small start-up companies, may be unable to satisfy the requirements of the more structured underwriting guidelines the larger banks use. The community bank’s relationship lending approach is often the only avenue for small businesses to obtain loans and access to other financial services.

Managing relationships at a personal level is the hallmark of community bank.

Beyond the asset-driven definition and behavioral characteristics, a true community bank creates a “community” culture both within and outside its walls.

True community banks get involved with their customers and with the community at large. They sponsor Little League teams, participate in charitable functions and attend social events.  They are visible in their community.

True community banks strive for the best customer service. Unlike the big, national banks, community banks don’t serve millions of customers. Consequently, their customers are more than just an account number on a computer screen. Every customer is treated as a friend and neighbor, which in many cases, especially in small communities, they are.

True community banks put the decision-makers in front of the customer. If you walk into a big bank to apply for a loan, you’ll most likely never meet or speak to the person who makes the decisions. Community banks operate transparently, allowing their customers to communicate with the people who make the financial decisions.

Community banks contribute to the local economy. These institutions stimulate, direct, and improve local economies by opening business accounts for entrepreneurs or extending loans to corporations. The community bank’s fortunes are intimately tied to the fortunes of their local communities. So, they have a vested interest in the economy of the community in which they operate.  The more the community prospers, the more the local community bank benefits.

 

 

 

 

 

 

 

 

 

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