Maryland Banker 1Q 2014

FIRST QUARTER 2014

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Chairman Robert A. DeAlmeida President & CEO Hamilton Bank

FIRST QUARTER 2014

e HealthCar Program

Chairman-Elect John A. Scaldara, Jr. Chairman, President & CEO The Columbia Bank

Vice Chairman Daniel J. Schrider President & CEO, Sandy Spring Bank

MBA’S NEW

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2013 NEXT LEADERS IN BANKING

THE OFFICIAL PUBLICATION OF THE MARYLAND BANKERS ASSOCIATION

Past Chairman Michael L. Middleton Chairman & CEO Community Bank of Tri-County President & CEO Kathleen M. Murphy

Contents

186 Duke of Gloucester St. Annapolis, MD 21401 410-269-5977 / 800-327-5977 www.mdbankers.com

Maryland Bankers Association

Publication Editor Cynthia L. Gentilcore Maryland Bankers Association

Board of Directors Calvin E. Barker Regional President, Baltimore Metro Region, BB&T George J. Behr, Jr. President & CEO, Arundel Federal Savings Bank Andrew M. Bertamini Regional President, Maryland Market, Wells Fargo Bank, N.A. James R. Bosley, Jr. President & CEO, Farmers & Merchants Bank Ralph W. Emerson, Jr. Senior Vice President, M&T Bank Raymond W. Hamm, Jr. Executive Vice President, PNC Bank, N.A.

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MBA’s New Health Care Program for Member Banks

Michael E. Hough CEO of Maryland Division, Susquehanna Bank Kim Liddell Chairman, President & CEO, The National Bank of Cambridge Michael G. Livingston President & CEO, The Bank of Glen Burnie Philip E. Logan President, Chairman and CEO, Slavie Federal Savings Bank Carissa L. Rodeheaver, CPA, CFP President & CFO, First United Bank & Trust George Swygert Regional Executive, Capital One, N.A. Raymond M. Thompson President & CEO, Calvin B. Taylor Banking Company Kelly Whitley Vice President, State Government Relations, Bank of America J. Scott Wilfong Chairman, President & CEO, SunTrust Bank, GW/MD

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message from the chairman Advocacy and Benefits of Membership 5 message from the president Three Steps

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DEPARTMENTS: news and notes 28 professional development calendar 30

20 First Quarter 2014 | 3

Message from the Chairman ROBERT A. DEALMEIDA | MBA CHAIRMAN

PRESIDENT & CEO

HAMILTON BANK

Advocacy and Benefits of Membership

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s I reflect on reaching the midpoint of my year as chairman of the Maryland Bankers Association (MBA), I have witnessed great accomplishments by the MBA staff and by member volunteers.

My year began with our exciting convention, followed soon after by the commencement ceremonies at the Maryland Banking School and then MBA’s Annual Washington Visit. More recently, the BankNext conference was a huge success with record attendance, and we are gearing up for the annual CFO & Financial Management Forum. The second half of the year will start off with the “First Friday” Economic Outlook Forum. In March, you will have the opportunity to join us back in Washington, D.C., for the ABA’s Spring Summit along with more than 1,000 bankers and their respective 50 state bankers associations. The MBA will also be providing educational seminars to keep you abreast of industry trends and new regulations. The second annual conference of the Council of Professional Women in Banking and Finance will be on May 1, 2014.

Overlapping this jam-packed calendar, the Maryland General Assembly session for 2014 runs from January 8 through April 7.

The MBA’s participation in the General Assembly provides an opportunity to inform and educate our state lawmakers on the impact of their legislation. In addition, the MBA enlightens our delegates of all the support the banks provide to the communities in Maryland. We need to advocate for legislation that benefits the consumer and, at the same time, does the least amount of harm to the industry.

From the largest to the smallest, the Maryland Bankers Association’s member banks have an open-door relationship with lawmakers, and that’s the product of a lot of hard work by the MBA. We take a strategic approach to legislative advocacy, deciding it may be in the best interest of our industry to strike a balance of modifying certain components of a draft bill than advocating for its demise. We communicate to lawmakers that one part of a bill targeting the industry might look good but that another part has unintended adverse consequences, for example, job loss at a time when job growth is much needed across our state and the country.

One area in which I am pressing for improvement is to meet the goal of the Maryland BankPAC. Most bank CEOs understand the value of the Political Action Campaign (PAC) fund as an essential component of our advocacy success, but many younger employees may not. We need to educate our employees and directors of the value of a PAC and the opportunities it provides our industry. Our financial support encourages an atmosphere of open dialogue with our politicians.

I encourage every member to consider holding a “PAC drive” in your bank in 2014. It’s a great way to spotlight the role of Maryland BankPAC and to help employees and directors see how their contributions, no matter how small, do make a difference.

Lastly, for years the MBA sought ways to help our members manage rising health care costs. After 18 months in development, in August 2013, we launched a new member benefit health care initiative called MBA Benefits Alliance. MBA’s President & CEO Kathleen Murphy, along with L.R. Webber Associates Inc. (LRW), is reaching out to our members to discuss the MBA Benefits Alliance as an additional health care benefit strategy option (see story, page 8). As expected, our members are being deliberate as they assess the changing health care landscape to make sure our greatest assets, our employees, are offered good benefits. Only seven years ago in Pennsylvania, LRW helped the Pennsylvania Bankers Association launch its health care initiative with three member banks participating. The second year a few more banks joined, and now they continue to grow, with more than three dozen banks realizing the cost savings and benefits that come from an association program. The MBA Benefits Alliance is one of many revenue generating and cost saving programs MBA offers its members and I hope many of you will take advantage of them.

The advocacy role and the benefits of membership in the Maryland Bankers Association have never wavered. Your bank’s participation in the MBA is vital to the success of the industry. ■ Robert A. DeAlmeida is the chairman of the Maryland Bankers Association. Reach him at rdealmeida@hamilton-bank.com.

First Quarter 2014 | 5

Message from the President KATHLEEN M. MURPHY | PRESIDENT & CEO

MARYLAND BANKERS ASSOCIATION

Three Steps

P

ublic policy risk continues to rank high on our members’ list of concerns. That’s why, when the Maryland General Assembly convenes for 90 intense days on January 8, 2014, the collective strength of our members and the MBA public policy team will be called upon once again. Stay informed, let us know what you are hearing and get involved: Those are three steps that our members can take to serve a vital role in protecting and promoting the interests of the Maryland banking industry.

Stay Informed The MBA issues the Legislative Bulletin each Monday throughout the session. It’s a great way to stay informed of the high-profile, state-wide issues that are priorities for our governor, senate president and speaker of the house. It is also the essential document covering the banking industry’s priority issues. The Maryland Weekly also features news each Wednesday.

If you aren’t receiving these, please let me know. MBA analyzes all of the bills that are introduced in a session (nearly 3,500) and gets involved directly in 250-plus each year, putting support behind those that will benefit our customers and communities, amending those that need “technical” fixes on the language or inadvertently impact the banking industry, and opposing those that would be harmful to banks’ competitiveness and to our clients. Likewise, many of our members serve on local Chambers of Commerce and other organization boards, and are aware of issues of concern locally. Which brings us to the next step.

Let us Know What you are Hearing We value the perspectives our members gain when discussing legislative issues locally. Let us know if something percolates that you believe should be on MBA’s radar screen. As you can imagine, nearly every business issue impacts banks, because banks are businesses. Because of the vast array of bankingspecific bills in which we must get involved, we work closely with the Maryland Chamber of Commerce on those issues that impact business broadly. MBA’s Vice President of Government Affairs Mindy Lehman serves on the Legislative Committee for the Maryland Chamber of Commerce. That connection provides an avenue to share the banking industry’s perspectives and concerns, as well as keeping our ear to the ground on bills that are introduced that broadly impact business.

MBA’s Government Relations Council, chaired this year

by MBA Vice Chairman Dan Schrider, president and CEO of Sandy Spring Bank, is a broad group of government affairs executives, attorneys, CEOs, department heads, lenders, operations executives and others who dedicate significant time to reviewing the bills that MBA flags as potentially impacting the banking industry. This group also helps the MBA shape our positions and talking points on the bills which are also factored into our written and verbal testimony. We are grateful for their interest, dedication and service.

Additionally, 2014 marks the fourth year of the four-year election cycle. We are expecting a sizable turnover in the House and Senate, as well as changes in state-wide offices. As members begin to get a sense for how certain races are shaping up for the 2014 elections, we need to hear from you.

Get Involved Involvement is essential. As the industry’s lobbyists, we are on the ground in Annapolis every day advocating for banks and banking. However, it works best when we coordinate with our members to communicate concerns or support directly with their senator and delegates. We will be calling on our members for help again this year. Generally, we take a very targeted, strategic approach to seeking our members’ help. When a local banker calls their senator or delegate, they listen. We know how important it is to arm our members with the background and information needed to make those calls and contacts effectively.

We will host the annual Legislative Dinner and encourage every bank CEO and board member to attend. We will also hold the annual Day in Annapolis early during the session, and are looking forward to a large turnout. Surveys will also be issued so that we can assess the impact of a bill on our members and collect information to factor into our testimony.

As we embark on this 2014 Session of the Maryland General Assembly, we challenge all of our members to do their part to strengthen the industry’s advocacy. It is because of our members’ involvement and expertise that the MBA speaks with a strong and credible voice for banks and bankers. After all, collectively, we are promoting and protecting banks’ investment in Maryland. ■ It’s my honor to serve this great industry. Please contact me at any time to discuss issues of importance to you at kmurphy@mdbankers.com or 443-837-1601.

First Quarter 2014 | 7

Maryland Bank Services Preferred Provider

Employer-Sponsored Wellness Programs

E

mployers are increasingly turning toward selffunded health insurance and outcome-based reimbursement for health insurance. The selffunded model covers only the claim costs of their own group of insureds, rather than relying on a broader-based actuarial model. Outcome-based reimbursement, as an alternative to fee-for-service, is proposed as the wave of the future. But in order for it to work best, it needs the support of employer-sponsored wellness programs that are both appropriate for specific employee groups’ needs and accepted by the employee groups.

As a firm with more than three decades’ experience 8 | The Maryland Banker

in benefits consulting, L.R. Webber Associates, Inc. (LRW) can offer Maryland Bankers Association members many wellness-plan choices that fit their insured-group’s requirements.

Creation of Wellness Programs Standard claims reports segregate data: so many dollars for hospital stays, surgeries, prescriptions, and so on. But these reports are not tied together to give an appropriate picture. That requires a compliance oversight component. Critical information includes, for example, that an unidentified diabetic keeps doctors’ and specialists’

“LRW can review a more detailed history and create wellness programs that address specific priorities within a client.” appointments, as outlined in a provider report; takes medications correctly, as reviewed in the refill history; and has regular vision exams, derived from data from a separate carrier.

Based on data provided by identifier-redacted information, LRW can review a more detailed history and create wellness programs that address specific priorities within a client. For example, why offer smoking cessation if you don’t have a lot of smokers?

Eighty percent of insurance claims are related to five conditions: blood pressure, blood glucose, weight, tobacco usage and cholesterol. LRW explores ways to increase employee participation, advocating community-based rather

than commercially-based programs, and making them enjoyable through competition between branches/units/ divisions.

Weight-control programs work best when peer interaction can be a support network. LRW also has information on centers of excellence for many types of injuries/illnesses/conditions and can connect employees with these services.

Wellness programs are driven by participation only.

Employees are not held accountable for certain test results.

They’re only required to participate, have the exams and be part of the program. Non-participants typically pay higher premiums.

The rewards of self-insured plans are long term cost control. Employers want to offer comprehensive coverage with a quality carrier at a sustainable price. Employees want to have low out of pocket exposures in terms of premium sharing, co-pays or deductibles. This can be achieved if everyone is willing to work as a team. Contact L.R. Webber Associates’s Booker Moore at (814) 695-8066 or bmoore@lrwebber.com for more information.

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First Quarter 2014 | 9

ANNUAL WASHINGTON VISIT Maryland Bankers Brave the Government Shutdown and a Capitol Hill Lockdown

MBA members attend a briefing with the Office of the Comptroller of Currency.

O

MBA members socialize following a briefing with the Office of the Comptroller of Currency.

n October 3 and 4, the Maryland Bankers Association’s government relations team led more than 35 bankers (representing 20 banks from across Maryland) to Washington, D.C. for the MBA’s annual Washington Visit. During the event, bankers met with representatives from the Office of the Comptroller of the Currency (OCC); the Consumer Finance Protection Bureau (CFPB); the Federal Deposit Insurance Corporation (FDIC); the Federal Reserve; and the Maryland Congressional delegation. This annual visit is a critical element of the MBA’s advocacy efforts, providing an avenue in which our members can directly interact with their regulators and congressional representatives and effectively communicate concerns of the industry and their individual banks.

Under the backdrop of the recent government shutdown, the events of the week provided for an unusual and exciting visit. Some major topics discussed with regulators and elected officials included the need for an implementation period for qualified mortgage (QM) rules; the need for fairness in taxation between banks and credit 10 | The Maryland Banker

unions; and insight into the forecast of the economic and political situation in the United States. Adding to the atmosphere of excitement was a lock-down on Capitol Hill during our meetings with the Maryland Congressional delegation members, caused by a car ramming the White House barricade and law enforcement officials responding with a series of security measures.

Despite the events of the week, the regulatory agencies and members of the Maryland Congressional delegation were eager to meet with members. Thus, a robust schedule included meetings with representatives from the offices of members of the Maryland Congressional delegation, FDIC Chairman Marty Gruenberg, Federal Reserve Board Governor Jerome Powell, OCC‘s Senior Deputy Comptroller and Chief of Staff Paul Nash and his staff, and the CFPB’s Deputy Assistant for the Office of Financial Institutions and Businesses Liaison Elizabeth Ellis and staff.

Following is a brief report on our meetings during our 2013 Washington, D.C. Visit.

Continued on page 12

2013 Washington Visit Participating Agencies and Associations The MBA would like to thank the following agencies and associations that met with our group in 2013:

American Bankers Association James Ballentine, executive vice president, congressional relations and political affairs Joe Pigg, vice president and senior counsel, mortgage finance Virginia O’Neill, senior counsel, regulatory compliance

Independent Community Bankers of America MBA members and FDIC Chairman Marty Gruenberg.

Paul Merski, executive vice president for congressional relations and chief economist Karen Thomas, senior executive vice president, government relations and public policy

Congressional Visits Rep. John Delaney Rep. Elijah Cummings (Jedd Bellman, Bank Policy Advisor) Rep. Donna Edwards Rep. Dutch Rupersburger (Walter Gonzales, Senior Policy Advisor) Rep. Andy Harris Rep. Chris Van Hollen (Bill Parsons, Chief of Staff)

Federal Deposit Insurance Corporation Martin Gruenberg, chairman FDIC Chairman Marty Gruenberg addresses MBA members.

Office of the Comptroller of Currency John Lyons, senior deputy comptroller bank supervision policy and chief national bank examiner Paul Nash, senior deputy comptroller and chief of staff Karen Solomon, deputy chief counsel

Consumer Financial Protection Bureau Elizabeth Ellis, deputy assistant director for the Office Of Financial Institutions Nicholas Hluchyj, senior counsel in the Office of Regulations Kitty Ryan , deputy assistant director for the Office of Regulations

Federal Reserve Jerome Powell, member of the Board of Governors FDIC Chairman Marty Gruenberg shakes hands with MBA member Bill Grant, chairman and CEO, First United Bank & Trust.

First Quarter 2014 | 11

MBA Meets with the OCC for the First Time in 10 Years Up until the Dodd-Frank Act implementation, only a handful of Maryland banks were nationally chartered and therefore supervised by the OCC. Thus, a separate meeting with the OCC during the Washington Visit had not been a part of the MBA agenda in about 10 years. However, through provisions in Dodd-Frank, the Office of Thrift Supervision (OTS) was dissolved in 2011 and thrifts that were regulated

by OTS fell into the jurisdiction of the OCC. Thus, a much higher number of Maryland institutions are now regulated by the OCC and the 2013 Washington Visit was an excellent time to meet with this important regulator.

The OCC was well prepared for our group and had a number of key representatives available to answer questions. The meeting format at the OCC was relatively informal in that the entire meeting was structured as

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a question-and-answer session. This format was helpful in enabling our members to raise specific concerns and recommendations directly to the OCC. Topics discussed included cyber security, with a focus on thirdparty risk management and issues of implementation, particularly around QM and the need for a transition period, status for guidance on QM and QRM, and more. In addition, bank representatives raised questions on the OCC/OTS integration. The OCC responded saying that the OCC hired staff from OTS to effectively allow for a seamless transition. The OCC is also in the midst of a self-assessment to provide an internal evaluation of the agency. Further, the OCC highlighted the enhanced educational and informational materials, as well as, outreach efforts they are providing to help thrifts and banks with the goal of enhancing their compliance understanding.

Maryland Bankers’ Questions to CFPB Described as Some of the ‘Best’ This was MBA’s third meeting with the relatively new Consumer Financial Protection Bureau (CFPB).

Since the CFPB is tasked with the implementation of the QM and other related mortgage rules, this meeting was a great opportunity to emphasize the very real concerns Maryland bankers are grappling with including risk and liability concerns, the need for guidance on QM and fair lending, and the importance of providing a one-year transition period for financial service institutions to implement QM. The meeting provided an excellent exchange of questions and answers between MBA member bankers and CFPB representatives. Our group was exceptionally well prepared for this dialogue; bankers raised some hardhitting questions and were not afraid to press for additional clarification and/or more in-depth answers.

In fact, Virginia O’Neill, the ABA’s senior counsel, Center for Regulatory Compliance, who accompanied MBA on most of our meetings with the regulations, said that the Maryland bankers were some of best prepared bankers she had accompanied to the CFPB. In particular, she praised the quality of the questions our group raised and the fact that the Maryland bankers were able to respond to questions and issues which arose in response from the CFPB staff. After the meeting, she commended our group on how well prepared we were, noting, “The bankers demonstrated a thoughtful and thorough understanding of the issues and an ability to communicate them effectively to the CFPB. By describing specific examples of anticipated unintended consequences, the Maryland Bankers helped the CFPB appreciate the depth of banker concern.”

Key concerns and issues MBA and bankers raised with the CFPB include:

• Guidance on QM and Fair Lending In January of 2014, the newly created QM rule will become effective. A key regulation stemming from the reforms from the Dodd-Frank Act, creditors will now be required to determine the consumer’s ability to repay a mortgage before issuing a loan. The final rule issued by the CFPB outlines minimum requirements to determining a consumer’s ability to repay, and gives guidance in underwriting factors, as well as, outlines safe harbors. However, the final rule leaves bankers struggling with concerns about liability and risks – particularly if a bank decides to lend outside of QM – and risks associated with fair lending if a bank decides to offer only QM loans.

The CFPB has tried to reassure banks about this potential risk and liability, assuring community banks that as long as institutions continue with historically sound underwriting standards they will be able to largely lend as they have before. However, banks are dealing with

a new universe under QM and the other mortgage lending reforms – a universe that involves individual liability and a variety of unknown risks. At least in the short term, these risks and liabilities are playing a significant role in lending policy decisions.

Interestingly, on Oct. 22, 2013, the Federal Reserve, CFPB, FDIC, OCC, and NCUA issued a statement providing guidance on QM loans and the risks associated to Fair Lending. In their statement, they provided clarity regarding whether the disparate impact doctrine of the Equal Opportunity Act and Regulation B allows banks to offer only QM loans.

According to the document, “the agencies do not anticipate that a creditor’s decision to offer only qualified mortgages would, absent other factors, elevate a supervised institution’s fair lending risk.” We believe that the concerns bankers raised about this issue in comment letters and in with various meetings with regulatory agencies, were critical in the generation of this letter.

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• One-Year Implementation Period for QM Given such a rushed implementation process, banks and many third-party vendors have had little time to determine compliance implementation methods.

As a result, many banks do not have the mechanisms to be in compliance with the new rule by the January 2014 deadline.

The repercussions will be potentially devastating, with banks pulling back on or even curtailing all mortgage lending.

During our visit to the CFPB, MBA’s members expressed their concerns with the implementation. The CFPB panel articulated to us that they could not provide a one year implementation period, without a change to the DoddFrank legislation.

FDIC Chairman Marty Gruenberg’s Remarks – Community Banks Matter During our breakfast at the FDIC, Chairman Marty Gruenberg praised the efforts and inputs from banks around the nation on Basel III. He stated that the comment letters submitted had a significant positive impact on the final rule. He went on to discuss the accomplishments and significance of community banks around the nation, quoting from a recent FDIC study on community banking. In fact, during all of our meetings with our regulators, a common theme that arose was the recognition of the value of community banks to communities. Currently, 95 percent of United States banking organizations are community banks, and 600 out of the 3,000 counties in the United States only have community banks in operation throughout the county. That accounts for one fifth of the counties in the United States. Community banks are often characterized by localized ownership, and localized management.

This allows for these banks to build strong relationships within the community and have a vested interest in the prosperity and progress of the community.

A Candid Conversation with Federal Reserve Governor Jerome Powell Often, in meetings with regulators, it is difficult to find members who are willing to speak very candidly about 14 | The Maryland Banker

personal perspectives on controversial issues. However, during our meeting with Federal Reserve Governor Jerome Powell, the governor was refreshingly candid and addressed questions and comments from MBA members being sure to emphasize that the perspectives were his own, and not the official position of the Federal Reserve. A day before speaking to our attendees, Powell spoke at a Community Bank Research Conference stressing the importance of community banks, and commending their efforts in the growth of small businesses within communities.

During the speech he outlined the Federal Reserve’s plan to overhaul its consumer compliance supervision program for community banks in 2014, allowing more emphasis on basing examinations on the bank’s culture.

In addition, Powell provided some excellent insights to the government shutdown and pending debate on the debt ceiling. Bankers also raised questions regarding community banks’ ability to raise capital and the rules around ownership, housing finance reform, and the fair lending risks associated with QM. One of the attending bankers later commented that, “I was truly impressed with Governor Powell,” a comment that MBA heartily echoes. Powell replaces former Governor Betsy Duke on the Federal Reserve Community Bank Committee and we look forward to working with him in his new role.

Making Our Voices Heard In preparation for our Capitol Hill visit, in the mist of the looming government shut down, the MBA was able to work with the staff of the offices of the members of our Maryland Congressional delegation to schedule meetings with all eight members serving in the United States House of Representatives, and both U.S. senators representing Maryland. Shortly into our first round of meetings with members of the Maryland Congressional delegation, we were notified that the Capitol had been put on lock-down due to a situation that had unfolded near the Senate Hart Building.

As a result, MBA and the bankers from Maryland spent the better part of an hour

“locked” in our meetings with Reps. John Delaney, Donna Edwards, Chris Van Hollen and Andy Harris. MBA commends the congressmen and their staff for their incredible poise and graciousness during this tense period. In spite of the chaotic turn of events, MBA and our members remained on-point and focused.

Impressively, despite the lock-down, our members were able to meet with six members of the Maryland Congressional delegation. Even the members we were not able to meet with were anxious to meet with the Maryland Bankers Association, but due to tightened security after the lock-down were not able to.

Many issues were emphasized in our visits with the various members of our Maryland Congressional Delegation.

Below is a brief overview of topics we highlighted in our discussions.

• Fairness in Taxation for Credit Unions With credit unions growing larger every day, it appears that the defining purpose of the credit unions has been lost. Many of the credit unions today operate very similarly to banks, and given a favorable tax structure, are able to outcompete banks. As they have grown larger, credit unions have expanded lending, and have begun driving community banks that often are owned and operated by members of the community they serve out of business, through the ability to offer lower rates that result from their large tax exemptions.

During our visit on Capitol Hill, MBA members effectively emphasized the issue, stressing the simple fact that Credit Unions are operating as banks. We asked members for fairness in taxation between credit unions and banks.

• QM Implementation Period During our visit to Capitol Hill, our members urged our Maryland Congressional delegation for their support of a one-year implementation period. In our meetings, we explained that Maryland banks would need this period for a meticulous examination of the rules to ensure that we are executing the best methods of compliance that would

lead to the future long term success and prosperity of our communities. Some of our delegation members were sympathetic to these concerns and in late October, Rep. Andy Harris agreed to sign onto a letter circulated by the House Financial Institutions Subcommittee Chairman Shelley Moore Capito, urging the CFPB to issue a one-year implementation period for the QM rules.

• CLEAR Relief ACT The increasingly complex and prescriptive regulatory environment that the banking industry faces has diverted resources and attention from serving customer needs. In recognizing the ramifications of the regulatory impact, Sens. Jerry Moran, Jon Tester, and Mark Kirk, and Rep. Blaine Luetkemeyer have introduced the Community Lending Enhancement and Regulatory Relief Act (CLEAR Relief Act). Major attributes of the legislation include, expanding the qualified mortgage safe harbor, reducing annual privacy notices, requiring a costbenefit analysis for any new or amended accounting principles, and exempting smaller institutions from management and attestation requirements. Many of the congressional members that we met with were sympathetic to the concerns raised.

Shortly after our Washington Visit, Rep. Andy Harris co-signed the CLEAR Relief Act. We have also urged our other House members to do the same.

Conclusion We extend our appreciation to the American Bankers Association for all of their hard work in helping us arrange our various meetings with our regulatory agencies and hosting and conducting an issues briefing so that we were prepared.

We also extend a special thank-you to our sponsors, Ober/Kahler, the Federal Home Loan Bank of Atlanta, and the Independent Community Bankers of America for their generous support.

Finally, the difference that we make is only possible through committed and involved members who make this annual Washington Visit possible. Involvement in MBA’s advocacy efforts makes sure our voices are heard on Capitol Hill. ■

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First Quarter 2014 | 15

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16 | The Maryland Banker

BANKS

BY CHRISTINA P. O’NEILL

After years of planning and review, the Maryland Bankers Association’s launch of MBA Benefits Alliance, or MBABA, is well under way. Created in partnership with experienced benefits advisory firm L.R. Webber Associates, Inc. (LRW), the alliance gives MBA member banks access to a self-insured health care program and many other ancillary services that increase bank efficiencies. (See sidebar on page 18.)

“The MBA had been looking for a solution to the ever-increasing cost of health care for their members,” says Booker Moore, president and CEO of LRW. The company’s partnership with the MBA is the fourth – and successful – attempt in the last 12 years to put a benefit program together to serve the needs of MBA member banks. Maryland is a highly regulated state, Moore notes, and the state regulatory body, the Maryland Insurance Association, sets high standards. “The hurdle in Maryland was convincing the Maryland Insurance Association that we were following the rules and staying within their guidelines. It was a good process that left everyone satisfied,” he says.

MBA President Kathleen Murphy agrees. “Before we moved forward, we wanted to confirm that the structure we were proposing complied with Maryland law. The Maryland Insurance Administration, ultimately, had no objections to the proposal we presented,” she says.

MBA member banks are looking for comprehensive coverage, a quality carrier and controllable costs. The third aspect, a result of the first two, evolves over time. “This is not about short-term cost savings; it’s about long-term cost control,” Moore says.

To make it work, member banks must become involved in the plan process, with an awareness of where their self-insurance funding is going, and be pro-active in setting up wellness initiatives.

Prior Experience First United Bank and Trust, based in Oakland, MD, already has more than 30 years’ experience teaming up with LRW on various projects and the company has served as the bank’s third-party administrator for its health care plan for about 15 years. Jeannette Fitzwater is senior vice president and director of corporate services at the bank. “For us, the greatest benefit of the MBA Benefits Alliance is the economies of scale for administration and the spreading of the risk in terms of stop-loss coverage,” she says. First United moved to self-funding some years ago and started wellness initiatives in 2005, using various incentives to encourage staff participation.

Fitzwater commends the advice the bank has received from LRW. “In the end, the proof is in the results,” she says. “Over the last five years, we have been able to keep our increases at about half of what other banks are experiencing.” She says if the bank had trended with its peers over that five-year period, its current health insurance expenses would now be 21.6 percent higher. In dollar terms, the estimated impact Continued on page 18

First Quarter 2014 | 17

Meet L.R. Webber Associates, Inc. More than 35 years ago, L.R. Webber Associates, Inc. (LRW) began working with several financial institutions across Pennsylvania and surrounding states. Over that span, they have worked with over 200 financial institutions in Pennsylvania, Maryland, New Jersey and New York. In addition to its new role as third-party administrator for the Maryland Bankers Association, LRW specializes in the financial services industry and is the endorsed vendor for employee benefits solutions by the Pennsylvania Bankers Association (PBA).

LRW is also involved in the organization and operation of state banking programs in Montana, Wyoming and North Dakota through its membership in United Benefit Advisors, the largest alliance of independent employee benefit advisory firms in the U.S. In the early 1980s, they created and still administer the largest salary and benefits survey for the banking industry in the mid-Atlantic states.

LRW is bound contractually with the MBA Benefits Alliance for marketing, program management, implementation, billing, enrollment changes, customer service, claim support, benefits planning and program accounting. More specifically, they are responsible for the following services to the banks in the alliance:

• 5500 preparation • Alliance financial management/reporting • Benefit planning, plan design and management • Billing • Claim support • COBRA administration • Customer service for both employer and employee • Health care reform support • Open enrollment support • Plan document development LRW also offers many unique services to clients outside of the alliance arrangement. They are able to deliver complete services relating to medical, dental, vision and drug plans as well as ancillary coverage such as life, disability, long term care and voluntary benefits through internal sources. Their in-house administration unit makes it convenient to administer flexible spending accounts, medical expense reimbursement accounts (MERPs), HSAs and HRAs. Their “one stop shop” approach leads to better long term employee satisfaction with the benefits programs that require a significant investment from each MBA member organization.

18 | The Maryland Banker

for 2013 alone would have represented about $300,000 in additional expense borne by the bank – not inclusive of the cost-sharing borne by employees in premium increases, which would likely have been increasing at a similar pace.

This year, First United offered employees and their spouses the opportunity to participate in health screenings, a health risk assessment and vision wellness tests. Based on their participation and success levels, they could owe less or more on their 2014 premiums. “This has really made it a fairer process for all participants and certainly encourages participation in healthy behaviors,” Fitzwater says.

Also important to First United is that its health plan be streamlined and efficient, giving employees easy access to their chosen physicians. The bank has used the United Health Care/OneNet network for years and less than 5 percent of its claims come from out-of-network providers.

“Best of all, due to the tremendous support we receive from L.R. Webber Associates, our HR staff doesn’t spend their day working through these issues.

The claims are handled efficiently and our employees are able to use their same trusted medical providers,” Fitzwater says.

Making the changes to a different health insurance model can be intimidating, she says, but sometimes it just has to get done. “However, it’s not as scary when you have a team working with you that has experience, expertise and true caring for your associates,” she says.

Making Informed Decisions The entire insurance marketplace has been moving in the direction of self-insurance, in which employers pay directly for the claims their employees incur (with stop-loss as a safety valve).

The wellness initiatives offer the chance for member banks to influence the health-care outcomes of their smaller, specific group of insureds, rather than being part of a much larger risk pool over which they do not have control.

“We are transparent about where the money goes; we are building customized wellness programs that directly impact the type of claims we’re having,” Moore says.

Another advantage of self-funded programs is that companies have more information about where their costs go.

“If you don’t have the data, you can’t make informed decisions [that will] moderate cost increases going forward,” Moore says.

“With a program governed by bankers for bankers, they will be controlling their own destiny. And it is a team effort with the banks’ employees when the entire group gets healthier through wellness initiatives. It’s a win-win when everyone does their part,” Murphy concurs.

Something to Work Toward LRW conducts considerable employee education. In his 30-plus years of benefits consulting, Moore says it’s become easier to get buy-in from employees on wellness initiatives. For those groups which put in the effort, employees see rewards for participating at insurance renewal meetings where they aren’t getting socked with big increases in payroll deduction. “Everyone has to be pulling the rope in the same direction,” he says.

Additionally, he says, medicine may

offer better outcomes than it did a generation ago, but it also costs more.

Younger employees are becoming more aware of the health situations their parents or their co-workers are experiencing, and are more motivated to be proactive. “Generations past didn’t have this,” Moore says. “There wasn’t the incentive to do things [to control costs]; now it is there and it does work.” And, he adds, “You don’t have to be the company triathlete to make it work.”

A Team Effort The self-insurance strategy set up by MBA Benefits Alliance is compliant with all current aspects of the Affordable Care Act and other applicable state and federal laws.

Fitzwater says that LRW tracks evolving changes to the law and this year, advised First United to offer a third-tier, higher deductible plan. “We continue to make sure that we are meeting the affordability guidelines for the future,” she says. “ When we went the self-insurance route on our own, we saw how it worked for us. Being part of a larger self-insurance alliance with

other members of the Maryland Bankers Association will achieve greater results than any one institution can achieve on its own.

The most important thing Moore wants to convey to MBA member banks: “It’s an old adage that when you do the same thing over and over again but expect different results, that’s insanity,” he says. “So when banks have concern over offering quality [employee benefit] programs but can’t rein in costs, they’ll get the same results.” The MBA board of directors and the board of Maryland Bank Services Inc. have guided the association in development of this important new member benefit, from selecting LRW to putting in place every component of the program, to the legal documents as well as member communications.

“Contributing to success of the program long term, effective wellness programs must be implemented and accepted by member banks’ insureds,” says Murphy. “When they realize that it’s a team thing – that as the group gets healthier and identifies health needs sooner, everyone wins.”

■

Recognizing Two Achievements Well Deserved.

Sean Hough

The Columbia Bank wants to congratulate Sean Hough and Joseph M. Zajdel on being named 2013 Next Leaders in Banking by the Maryland Bankers Association. As Vice Presidents of Commercial Banking, Sean and Joseph both demonstrate a high level of dedication to meeting the needs of their customers, and take great pride in serving the local community. Currently, Sean serves on the boards of both the Howard County 4H Foundation and MakingChange, and Joseph serves on the United Way of Central Maryland’s Emerging Leaders United Board.

Joseph M. Zajdel

888.TCB.BANK

I

thecolumbiabank.com

Member FDIC. Member of the Fulton Financial Family.

First Quarter 2014 | 19

EXPLORING THE FUTURE OF BANKING

Save the date for next year’s conference in November 2014, which will no doubt be another must-attend event!

20 | The Maryland Banker

BankNext 2013 Draws Hundreds for Education, Networking and Celebrating BankNext, the annual banking conference sponsored by the Maryland Bankers Association and The Warren Group, was a success again this year, with hundreds of MBA members gathering to learn, network and celebrate with their peers. Seminars lead by industry experts addressed a variety of topics, including banking in the

cloud, MBA’s council of professional women in banking and finance quarterly meeting, and an update on cyber security. The invitation-only breakfast for c-level executives was well attended, as was the annual Next Leaders in Banking and Financial Education Awards Luncheon (see next pages).

First Quarter 2014 | 21

Name: Chris Chick Age: 46 Title: Senior Vice President, Commercial Executive Bank: Susquehanna Bank Bank location: Baltimore Town of residence: Edgewater

The Next Leaders in Banking are the best and brightest of Maryland’s banking industry. Nominated by their peers and chosen independently by a panel of unbiased judges, these 13 men and women are the rising stars of the industry. Some are just starting out, while others are seasoned veterans – but all are working hard to make a difference in their communities and their institutions.

How did you come to community banking, and why do you stay?

Out of college I worked as a bank examiner. I was attracted to community banking because I saw it as an opportunity to be involved in many areas of the bank. Over the years, I have had many different position within Susquehanna Bank. After 21 years, I stay because of the relationships with co-workers and customers.

What do you consider your biggest success?

I have been blessed to work with some amazing people over the years in different roles. If I had to pick the biggest success, it would be our team’s management of the loan portfolio through the recent economic downturn.

How do you see technology changing the banking industry over the next 10 years?

How retail products are delivered. Retail products will be done without personal interaction. This is a bit contrary to community banking; however, it is where the next generation is moving in terms of technology.

If you weren’t a community banker, what would you be doing?

I would be doing something in the real estate industry.

Where’s your favorite place to get a crab cake?

My sister and brother-in-law’s house.

20 80+ 125+ 150+

Banking Partners, including Lori Charlebois, Partner-inCharge of Maryland Financial Institution Services Group Years Serving Your Industry Banking Clients Bank Professionals

“

We take great pride in treating our members like family, and our advisors at Dixon Hughes Goodman mirror this commitment. We trust their industry knowledge and accounting proficiency to navigate banking regulations, governance and reporting. Through it all, we receive outstanding client service as we continue to grow our hometown community bank.

—G. Robert Aston, Jr., Chairman & CEO, TowneBank

CPAs and Advisors | www.dhgllp.com/banking | benchstrength@dhgllp.com | 877.999.9343 Lori Charlebois | 240.403.3779 | lori.charlebois@dhgllp.com 22 | The Maryland Banker

“

Congratulations, 2013 Next Leaders!

Name: Chris Skandalis Age: 36 Title: Vice President Bank: CFG Community Bank Bank location: Baltimore Town of residence: Bel Air

Name: Clarence Campbell Age: 40 Title: Area President, Senior Vice President Bank: Wells Fargo Bank location: Baltimore Town of residence: Reisterstown

How did you come to community banking, and why do you stay?

I came to community banking after being recruited out of a regional bank. Community banking is much more relationshipdriven, where customers are always the main focus. It is very rewarding to help the community you live in continue to grow.

How did you come to community banking, and why do you stay?

I started my career as a teller and later transitioned into sales.

My passion is around assisting clients with achieving financial success and coaching others to develop. The impact that I can have on the lives of others is what led me to community banking and the reason I stay.

What do you consider your biggest success?

Besides getting married and raising a family over the last 13 years, my biggest success is the hard work I’ve put in to get me where I am today in my career. From starting out in an entrylevel banking position out of college, I’ve consistently worked hard to go above and beyond my job duties and separate myself from my peers. Fortunately, many of the managers I have had recognized my worth ethic and potential and have assisted me in advancing my career.

What do you consider your biggest success?

Being promoted to the position of area president is an accomplishment that I am very proud of. Getting to this point in my career was the result of many successes along the way. Such as building strong partnerships; coaching and developing leaders in our organization; leading teams to drive great sales and service results year after year; and working to build our community. It’s tough to narrow my biggest success to one event. It is the combination of my faith; the excellent leaders who have mentored me; the talented team members who have supported me; and the personal drive to succeed that have made me the leader I am today.

How do you see technology changing the banking industry over the next 10 years?

Digital technology will continue to evolve through mobile devices to make things as convenient as possible for consumers. Banks will need to be innovative to stay competitive. Cyber security will continue to be a main focus as technology evolves.

If you weren’t a community banker, what would you be doing?

With my love for sports, hopefully something related to professional sports – front office work, or an agent.

Where’s your favorite place to get a crab cake?

Box Hill Pizzeria in Bel Air.

How do you see technology changing the banking industry over the next 10 years?

I see technology continuing to have a tremendous impact on the banking industry in the future.

The advancement in technology will continue to make it more convenient for customers to make bank transactions, manage their accounts from anywhere and get professional advice and guidance for building wealth.

If you weren’t a community banker, what would you be doing?

Coaching and teaching are passions of mine! I would likely be teaching and coaching youth.

Where’s your favorite place to get a crab cake?

I love the crab cakes at G&M Restaurant in Linthicum Maryland.

Name: Corey Galinsky Age: 33 Title: Vice President of Residential Mortgages Bank: Severn Savings Bank Bank location: Annapolis Town of residence: Annapolis

Name: Dawn Lewis Age: 38 Title: Audit Manager Bank: First United Bank & Trust Bank location: Oakland Town of residence: Oakland

How did you come to community banking, and why do you stay?

I had the opportunity to meet with our President and CEO Alan Hyatt, who introduced me to the ideals and the history of Severn Savings Bank. When you understand the deep commitment they have to serving the community and truly valuing each and every customer relationship, wanting to be a part of the team was an easy choice for me. I stay at Severn because it is incredibly exciting to contribute all you can to grow and progress such a great team oriented organization, while continuously developing positive ways to impact the surrounding community.

How did you come to community banking, and why do you stay?

I was actually working in public accounting when my older sister encouraged me to apply for an auditing position here at First United. Being in internal audit allows you to learn and experience the ins and outs of every department within the bank, meet and interact with the majority of the bank’s management and staff, as well as the board’s Audit Committee. Of course there are days that are stressful or nerve-racking, but I learn something new in this job every day. It’s been an amazing experience thus far, and I’ve never looked back.

What do you consider your biggest success?

While I am proud of my contributions to my profession, I would consider my biggest success being the husband to a beautiful wife and the father of two beautiful children.

What do you consider your biggest success?

Professionally, I would have to say becoming a manager. There are so many different things to see on “the other side” of the realm. You get out of the weeds and get to see the forest a little more for what it is. I am also fortunate enough to work for a wonderful institution, within my hometown, who afforded me the opportunity to learn and grow each day. On the personal side, my answer is definitely my family, with all its branches and twists. Without their love and support, I wouldn’t be where I am today.

How do you see technology changing the banking industry over the next 10 years?

I think technology will change banking by continuing to progress online banking services, and by making processes more efficient and instantaneous for the customer. Whether it’s checking your account balance or choosing a loan product, the customer will continue to be provided with more access to information at their immediate disposal. This is very empowering and customerfriendly, as clients can access systems or accomplish transactions when it is conducive to their schedule.

If you weren’t a community banker, what would you be doing?

Chances are I would be a lawyer or professor. I think that some of the greatest knowledge we can ever acquire is from good educators. I can also tell you I had great naps in the back of the class of some dismal ones. Also, I have always been fascinated by the legal profession and its history. To be able to set a precedent for the betterment of our society is a truly amazing thing.

Where’s your favorite place to get a crab cake?

Anywhere they serve steak.

How do you see technology changing the banking industry over the next 10 years?

I think that technology will continue to have an enormous impact on the banking industry in ways that we don’t even know about yet. With the sure comings of interactive tellers and mobile capture, among other things, the traditional idea of banking will be forced to evolve.

If you weren’t a community banker, what would you be doing?

I would probably still be in public accounting or maybe even working as an accountant/ bookkeeper for a small business owner. My alternate career path was teaching, specifically elementary school. I love children and their adventuresome spirit, curiosity, excitement, and innocence.

Where’s your favorite place to get a crab cake?

I have Celiac Disease, so finding a restaurant with a gluten-free crab cake definitely poses a challenge. I do LOVE seafood though, so I’d have to say that my favorite place to get a crab cake is right at home. My husband, Jeremy, is an awesome cook and makes the best gluten-free crab cakes – more crab, less filler!

First Quarter 2014 | 23

Name: Heather Parsons Age: 35 Title: Assistant Vice President and Human Resources Director Bank: Bank of Ocean City Bank location: Ocean City Town of residence: Pittsville

Name: Jessica Grzybowski Age: 25 Title: Head Teller Bank: Old Line Bank Bank location: Bowie-Mitchellville Town of residence: Shady Side

How did you come to community banking, and why do you stay?

Sixteen years ago, I was hired as a seasonal teller with the Bank of Ocean City after graduating high school and I have worked my way up. The leadership team at the bank believes in encouraging their staff to further their education and they understand the importance of work life balance. Those are just two benefits that I truly value.

How did you come to community banking, and why do you stay?

I first started with The Washington Savings Bank, now Old Line Bank, about six and a half years ago as a part-time teller. I continue to stay because I love the institution I work for, as well as my co-workers. I also have come to know and love my customers. It is a proud feeling when you can greet almost every customer that walks in by name and ask how their children or grandchildren are doing.

What do you consider your biggest success?

I received my Professional of Human Resources (PHR) certification in 2009. Since then I have served on the board for the Eastern Shore Society of Human Resources Management (SHRM), most recently as president-elect. I am very proud of my involvement in this organization as I feel that we work diligently to provide valuable leadership training and continuing education to human resources and business professionals.

What do you consider your biggest success?

I believe my biggest success would be how I have excelled as head teller. When I first received the title I was new to banking, but my managers believed that I could do the job. They have guided me and helped me become the manager I am today.

How do you see technology changing the banking industry over the next 10 years?

I think that you will see the use of cash continue to decline as payment technology and remote and mobile banking options continue to increase. This trend will lead to smaller branches with less staff. It will become more important for the staff to be knowledgeable of the technological advances in order to best serve the customers. Regardless of where technology leads us, it will never take the place of a personal relationship between a community banker and their customers.

If you weren’t a community banker, what would you be doing?

I would probably have been a teacher.

Where’s your favorite place to get a crab cake?

As an Eastern Shore native, I was born and raised on seafood. Captain’s Galley in West Ocean City has the best crab cake that I have ever tasted.

Name: Jessica Moliere Age: 33 Title: Vice President, Branch Manager Bank: Sandy Spring Bank Bank location: Pasadena Town of residence: Pasadena How did you come to community banking, and why do you stay?

I came to banking at a very young age and did not expect for banking to be my career. I saw the way we changed our clients’ lives and fell in love with Sandy Spring Bank. I wanted to be part of helping people that I share my life with inside my community.

What do you consider your biggest success?

My children! Besides them, I would have to say my ability to work in a strong teamwork atmosphere. We cannot accomplish success on our own! When we work together we achieve so much more!

How do you see technology changing the banking industry over the next 10 years?

That is a great question! I see checks being obsolete, that is for sure. I believe that the community banking industry will continue to hold a similar model because our focus is on our clients and being readily available within the community. I see larger financial institutions having less branches, less staff and more technology. I have seen the impact of technology already with client satisfaction and larger banks … clients love the technology, but want to see a face and hear a voice of the bank they have a “relationship” with!

If you weren’t a community banker, what would you be doing?

I would probably be a nurse. I started nursing school, but changed gears when I realized I wanted to be a community banker.

Where’s your favorite place to get a crab cake?

Timbuktu in Hanover!

24 | The Maryland Banker

How do you see technology changing the banking industry over the next 10 years?

I think most of the banking industry will be electronic. With the advancements of mobile banking, online banking, and mobile deposits, the new generation of customers is all for the technological products. I still think we will need branches open for the customers who enjoy coming to the bank and doing their banking in person.

If you weren’t a community banker, what would you be doing?

I would most likely be a pastry chef in a local bake shop. Cooking has and will always be a passion of mine and I love it. It is relaxing for me to bake and cook for neighbors and family. I especially enjoy baking with my daughter.

Where’s your favorite place to get a crab cake?

My favorite place to get a crab cake is Skipper’s Pier. It is a little local restaurant in Deale, right on the water. In the summertime you can sit out on the pier and enjoy the great weather and gorgeous views as well as great company with family, friends, and the owners.

Name: Joseph Zajdel Age: 33 Title: Vice President of Commercial Banking Bank: The Columbia Bank Bank location: Columbia Town of residence: Mt. Washington (Baltimore City) How did you come to community banking, and why do you stay?

Commercial and community banks offer solutions to help meet the needs of their clients. However, community banks provide their clients with local decision-making and access to senior management. This tends to have a greater impact on the client’s relationship and the ability for the bank to truly know their client. Thus, the bank can act as a catalyst to spur growth in their communities.

What do you consider your biggest success?

I consider my biggest success the fact that I will be teaching at MICA (Maryland Institute College of Art) in March 2014 in their graduate program. My role will be to help graduate students understand finance, so the can successfully own and operate their own business.

How do you see technology changing the banking industry over the next 10 years?

Most likely, banking will continue to become more mobile. I believe consumers will always need bricks and mortar for opening accounts and accessing safe deposit boxes. But, we will continue to see more effective, full-service ATMs and improved mobile banking for the next decade or so.

If you weren’t a community banker, what would you be doing?

Most likely, I would be the CFO of Expedine. Expedine is a startup that I am involved with and currently on the board of advisors.

Where’s your favorite place to get a crab cake?

Box Hill Pizzeria in Abingdon. (If you haven’t tried them, just trust me.)

Name: Sean Hough Age: 49 Title: Vice President, Commercial Banking Bank: The Columbia Bank Bank location: Columbia Town of residence: Mount Airy How did you come to community banking, and why do you stay?

My first 10 years in the industry were spent at a large regional bank, where I learned a lot and had great experiences. The opportunity came along to move to a community bank and I have not looked back. The customer relationships and the people I work with are what keeps me going.

What do you consider your biggest success?

I am not one looking to be recognized for accomplishments or for personal gain. The respect of my peers and the trust my customers put in me is my greatest success.

How do you see technology changing the banking industry over the next 10 years?

The younger generation will drive where the banking industry goes with evolving technology.

Everything is electronic and at their fingertips. The world is also becoming a smaller place and international banking will continue to expand.

If you weren’t a community banker, what would you be doing?

I am already doing it. In my spare time I run a small farm with my family. I have a passion for raising livestock and being a steward of the land.

Where’s your favorite place to get a crab cake?

G & M Restaurant has the best crab cakes in town.

Name: Tiffany Cox Age: 31 Title: Branch Manager Bank: Baltimore County Savings Bank Bank location: Baltimore Town of residence: Fawn Grove, Pennsylvania How did you come to community banking, and why do you stay?

I started as a part-time teller while finishing college in 2004, and the career opportunities at BCSB have led to my growth and success. My customers are the reason I continue to love my job. There is great satisfaction in getting to know my customers and their families. I have been privileged to meet several generations within each family, and I have become a trusted advisor to many of them, as they each grow with their individual banking needs.

What do you consider your biggest success?

My biggest success has been the achievement of my Maryland Life and Health License, which has provided me the opportunity to offer my customers a vast array of financial solutions while at the same time maintaining a hometown atmosphere. I have also gained the trust of my team members, creating a competitive yet friendly work environment that enables us to hit our goals.

The management at BCSB has been very supportive in each employee’s professional growth and has taken a vested interested in our successes.

How do you see technology changing the banking industry over the next 10 years?

As remote banking continues to evolve it will re-define how the average consumer perceives our industry. It will also restructure the traditional banking branch, clearly decreasing the need for a teller line; however, it will increase the need for a platform employee. The day-to-day transactions that are quickly disappearing will prompt our industry to create new ways in which to increase lobby traffic. We will need to continue to offer competitive products and excel in customer service. This also creates a more aggressive sales culture within the banking industry, prompting us to become more present in our communities that ever before.

If you weren’t a community banker, what would you be doing?

I would be at home with my children; if not that, I would love to have my own pre-school, laying the foundation for our future leaders. Young children have so much passion and enthusiasm; it would be great to be surrounded by that every day.

Where’s your favorite place to get a crab cake?

The Seafood Stop in Fallston.

Name: Timothy Rozalski Age: 35 Title: Vice President, Marketing Director Bank: Howard Bank Bank location: Ellicott City Town of residence: Baltimore City How did you come to community banking, and why do you stay?

I have been in banking for 16 years and have moved on to smaller banks throughout my banking career. I enjoy personally knowing everyone on the team I interact with at Howard Bank on a consistent basis.

What do you consider your biggest success?

Keeping meaningful relationships active throughout the years and through life changes.

How do you see technology changing the banking industry over the next 10 years?

When I started banking, online banking didn’t exist; I can only imagine that in the next 10 years, electronic delivery channels will continue to evolve, and I am excited to be a part of the changes in and evolution of these delivery channels.

If you weren’t a community banker, what would you be doing?

Back office operations with the Ravens organization.

Where’s your favorite place to get a crab cake?

McCormick & Schmick’s at Pier 5.

Name: Brian Oettinger Age: 38 Title: Vice President Bank: Sandy Spring Bank Bank location: Rockville Town of residence: Olney How did you come to community banking, and why do you stay?

My first job out of college was with a huge Wall Street firm. I came to find out that providing wealth management solutions within a community bank provided both me and the client with a much more enjoyable experience. What keeps me here the most is the flexibility to provide people with conflict-free solutions.

What do you consider your biggest success?

Personally, it was completing the Certified Financial Planning course work at Georgetown University and becoming a CFP. Professionally was the day I helped a family provide muchneeded health care solutions to a loved one while preventing the family from exhausting all of their financial resources.

How do you see technology changing the banking industry over the next 10 years?

I think the biggest change will come from finding innovative ways to integrate technology into building relationships.

If you weren’t a community banker, what would you be doing?

Fishing.

Where’s your favorite place to get a crab cake?

Cantler’s Inn in Annapolis.

First Quarter 2014 | 25

2013 Marks 10th Year for MBA’s Financial Education Awards

21 Member Banks Recognized for Work to Improve Financial Education in Their Communities!

Financial education has always been a top priority for our members, and the Maryland Bankers Association (MBA) is very proud that 2013 marks the 10th year for this prestigious awards program, bestowed by MBA’s Financial Education Council, that was first launched by the MBA in 2004, to recognize the outstanding efforts of our member banks who are actively engaged in financial education outreach across Maryland.

Over this time our members have reported reaching over 90,000 Maryland students and/or residents in teaching financial education. These statistics are remarkable, and demonstrate that Maryland bankers continue their commitment to making a difference in their communities every day by teaching financial education programs that enable the public to improve money management skills.

The success of this program is due to the hard work and dedication of members of MBA’s Financial Education Council.

They are: Cathy Coughlin Senior Vice President, Director of Human Resources Old Line Bank

Sherrice Davis Vice President, CRA M&T Bank

Lisia Franze Vice President, Regional Branch Administrator Susquehanna Bank

Dana Hall Training & Recruiting Officer Industrial Bank A special 10-year recognition award was presented to New Windsor State Bank for outstanding achievement for 10 consecutive years towards improving financial education.

From left: Bob DeAlmeida, MBA chairman, and president and CEO, Hamilton Bank; Lisa Monthley, senior vice president, chief deposit officer, New Windsor State Bank; Tom Rasmussen, president and CEO, New Windsor State Bank; and Kathleen Murphy, president and CEO, MBA.

26 | The Maryland Banker

Tracey Jessilonis Assistant Vice President, Branch Manager Chesapeake Bank of Maryland

Karen Kokernak Senior Economic Education Specialist

Federal Reserve Bank - Baltimore Branch

Lisa Monthley Senior Vice President, Chief Deposit Officer New Windsor State Bank

Roger Powell Managing Director Janney Montgomery Scott LLC

Erin Shoop Accountant

Smith Elliott Kearns & Company, LLC

Barbara Sumney Community Reinvestment Officer The Columbia Bank

Brenda Keefer Regional Credit Support Specialist Emmyrich Vicente Vice President/Branch Manager III Susquehanna Bancshares, Inc. PNC Bank, N.A.

Pictured are some of the 2013 Financial Education Award winners and participants.

The financial education award entries are reviewed each year

by MBA’s Financial Education Council and are based on various criteria, including: program; presentation materials; community impact; financial education concepts; and development. They are then awarded in the following three categories: • School-Age Children (pre-school through eighth grade) • Young Adults (high school and college students) • Adults and Seniors (age 25 and older)

The 2013 Financial Education Award winners: School-Age Children (bank assets less than $1 billion) First Place New Windsor State Bank Second Place Community Bank of the Chesapeake School-Age Children (bank assets greater than $1 billion) First Place The Columbia Bank Second Place PNC Bank, N.A. Young Adults First Place Wells Fargo Bank, N.A. Second Place Capital One Bank, N.A. Adults and Seniors First Place PNC Bank, N.A. Second Place The National Bank of Cambridge

This year 21 banks participated in the awards program, submitting a total of 41 entries. They were honored at an awards luncheon held in conjunction with MBA’s BankNext event on Thursday, Nov. 7 at the BWI Marriott in Linthicum, Maryland.

A special recognition award was also provided to the following 14 banks who submitted entries this year, and who are improving financial education in Maryland’s communities: Baltimore County Savings Bank Bank of Georgetown Bank of Ocean City Calvin B. Taylor Banking Company Carroll Community Bank Fraternity Federal Savings & Loan Association Frederick County Bank Hamilton Bank Howard Bank Old Line Bank Queenstown Bank of Maryland Sandy Spring Bank The Talbot Bank of Easton, Maryland Woodsboro Bank In recognition of MBA’s Financial Education Awards 10th year, the MBA recognized New Windsor State Bank, which has a unique honor. They have won an award in at least one, sometimes two categories, each year since the program was launched 10 years ago. A special 10-year recognition award was presented to New Windsor State Bank for outstanding achievement for 10 consecutive years towards improving financial education.

Congratulations to this year’s 2013 Financial Education award winners and participants! They all should be commended for the work they do all year to improve the financial education skills in their communities.

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First Quarter 2014 | 27

News &

Notes

Members on the Move

Jennifer Figgs

Tina Kolarik

Ray Robinson

Peggy Welsh

Keith Sanders

R. L. Fisher

Richard Story

Michael Benedict

Lisa Morgan

Pedro Vila

Betsy Graham

Jennifer Rice

Tina Lee

Erin Dieterich

Calvin B. Taylor Banking Company promotions: Jennifer Figgs was promoted to branch manager of the bank’s West Ocean City location.

Tina Kolarik, senior vice president, was promoted to operations officer.

Ray Robinson, assistant vice president and security officer, transferred to the bank’s 20th Street office as branch manager.

Peggy Welsh, senior vice president, was promoted to branch administration officer.

Michael Middleton, chairman and CEO, will transition to become executive chairman of both Community Bank of the Chesapeake and its holding company, Community Financial Corporation, on July 1, 2014. Also taking effect: William Pasenelli, president and chief financial officer for The Community Financial Corporation, will become president and CEO of both the holding company and the bank.

Todd Capitani, chief financial officer for the bank, will become chief 28 | The Maryland Banker

financial officer of The Community Financial Corporation.

First United Bank & Trust promoted Keith Sanders to First United Trust & Investments senior vice president. Sanders has over 20 years of experience in the financial services industry, specializing in wealth management, estate planning, trust administration and financial planning for clients.

R. L. Fisher joined First United Bank & Trust as senior vice president and chief lending officer. Fisher has over 20 years of executive financial services experience.

president of Greenlawn Cemetery Co.; a licensed real estate agent for 25 years and also involved with various solar energy and agricultural projects.

James Pierne, who retired from Susquehanna Bancshares Inc. in December 2011. He served as president and CEO of Susquehanna Bank and executive vice president of Susquehanna Bancshares. He also served as chairman of the Maryland

Richard Story joined Howard Bank as senior vice president, heading its community relations and government affairs. Story will also be the bank’s business development liaison.

The following were elected to the board of directors for Middletown Valley Bank: Todd Snook, president of Valley Storage Co. and related entities (a real estate development and management company); vice

William H. Mitchell, executive vice president chief operating officer of the Calvin B. Taylor Banking Company, retired on September 30, 2013. Mitchell joined Taylor Bank on June 1, 1970 and spent 43 years dedicated to Taylor Bank customers, stockholders and employees.

Bankers Association in 2008-2009.

Pierne has over 38 years of banking industry experience.

at the store serving customers throughout the area.

Michael Benedict joined OBA Bank as a vice president and will serve as a commercial banking officer.

Benedict has extensive commercial credit, underwriting, portfolio management, and small business lending experience and will serve commercial borrowers in the greater Washington metro area for OBA Bank.

PNC Wealth Management, a member of the PNC Financial Services Group, promoted Lisa Morgan to wealth management team director on the Eastern Shore. She leads teams of wealth management professionals in delivering PNC’s comprehensive investment, trust, financial planning and private banking services to clients.

Pedro Vila joined TD Bank as the senior relationship manager in the not-for-profit division. He is responsible for providing financial services in the areas of credit, public finance treasury and investment management to tax-exempt organizations and institutions across the bank’s mid-South region.

Daniel L. (Danny) Dalton was named store manager of TD Bank’s City Place store in Silver Spring.

He is responsible for new business development, consumer and business lending, managing personnel and overseeing the day-to-day operations

Woodsboro Bank promotions: Betsy Graham was name compliance administrator. Graham, an assistant vice president, joined the bank in 2005 and most recently served as the bank’s loan operations manager.

Jennifer Rice was promoted to loan operations manager. Rice, who joined Woodsboro Bank nine years ago, previously served as manager of the Monocacy Village office.

Tina Lee was named an assistant vice president. Lee joined the bank in 2008 and currently serves as branch manager of the bank’s Monocacy Village and downtown Frederick offices.

Erin Dieterich was promoted to assistant branch manager of the bank’s corporate office in Woodsboro.

Dieterich joned the bank in 2007 and recently completed an extensive management training program.

William B. Grant

C. Richard Miller

Two Former MBA Chairmen to Serve on Boards of the ABA and Federal Reserve William B. (Bill) Grant, chairman and CEO of First United Bank & Trust and former MBA chairman (2004-2005), was elected to serve for a second term on the American Bankers Association’s board of directors.

C. Richard (Rick) Miller, president and CEO of Woodsboro Bank and former MBA chairman (2009-2010), was elected to the board of directors at Federal Reserve Bank of Richmond, as a Class A director.

Members in the Community

Bank Financial Services (BFS) appointed Daniel Barbaree as president of BFS and named David Payne as chief operations officer. The appointment of Barbaree (previously CFO and COO of BFS) continues the implementation of its business succession planning.

Sandy Spring Bank Chosen Best Place to Work by BBJ

Steven Gust, a former banker with both C-level and compliance experience, was named director of virtual compliance manager services at Thomas Compliance Associates, Inc.

On October 17, the Baltimore Business Journal unveiled its Best Places to Work winners in the small, midsize, and largebusiness categories. Congratulations to Sandy Spring Bank for being chosen as the third-place winner in the large business category.

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Welcome New Members Charter Members

Associate Members

John Marshall Bank Somerset Trust Company

BDO USA, LLP CoNetrix L3 Support, Inc. Mercantile Processing Inc. TechGuard Security, LLC Watkins Meegan LLC First Quarter 2014 | 29

Mar yland Bankers Association Professional Development Calendar SPECIAL EVENTS January 3-4 ”First Friday” Economic Outlook Forum January 29-31 Southeastern Conference of Community Bankers

May 1 June 1-4

Council of Professional Women in Banking and Finance Annual Conference Annual Convention

SEMINARS, WEBINARS, SCHOOLS, AND ONLINE TRAINING Compliance January 8 February 24 February 26 February 27 March 18 March 25

HMDA Review & Update (Webinar) Finance Charges (Webinar) Tax Returns (Webinar) Dodd-Frank Seminar (Baltimore) Integrated Disclosures (Webinar) 2014 Anti-Money Laundering & Bank Secrecy Act (Baltimore)

Finance February 3 March 31

Managing Funding, Liquidity, and Capital (AIB)

Analyzing Bank Performance (AIB)

General Banking January 6

January 13 January 21 February 3

February 10

February 18

March 3

March 4 March 17

March 31

Anti-Money Laundering (Salisbury)

Insurance Fraud (Waldorf, Towson, Glen Burnie)

Managing the Bank’s Investment Portfolio (AIB) February 3

Executive Management & Directors February 3

January 20 January 21 January 22 January 23 January 27 January 28 January 29 January 30

General Accounting (AIB) Principles of Banking (AIB) Law & Banking: Applications (AIB) Principles of Banking (AIB) Law & Banking: Principles (AIB) Principles of Banking (AIB) Money & Banking (AIB) Supervisor Certificate (AIB)

Identity Theft (Salisbury) Ethics (Glen Burnie) Ethics (Rockville) Errors & Omissions (Towson) Ethics (Waldorf, Towson, Glen Burnie) Anti-Money Laundering (Waldorf, Towson, Glen Burnie)

March 28

Ethics, Insurance Fraud, and Anti-Money Laundering (Cumberland)

Errors & Omissions, Identity Theft, and Risk Management (St. Marys County)

February 11

Errors & Omissions, Identity Theft, and Risk Management (Cumberland)

February 13

Errors & Omissions, Identity Theft, and Risk Management (Columbia)

February 17-19 Property & Casualty Pre-Licensing (Towson) February 19 Ethics, Insurance Fraud, and Anti-Money Laundering (Frederick)

HR Management

Errors & Omissions, Identity Theft, and Risk Management (Towson)

February 27

January 14 January 15

Ethics, Insurance Fraud, and Anti-Money Laundering (Easton)

February 28

Errors & Omissions, Identity Theft, and Risk Management (Easton)

March 4

Ethics, Insurance Fraud, and Anti-Money Laundering (Waldorf)

March 5

Errors & Omissions, Identity Theft, and Risk Management (Waldorf)

March 6

Ethics, Insurance Fraud, and Anti-Money Laundering (Hagerstown)

March 7

Errors & Omissions, Identity Theft, and Risk Management (Hagerstown)

Health Savings Account (Webinar)

Property & Casualty Pre-License (Glen Burnie) Ethics (Hagerstown) Insurance Fraud (St. Mary’s County) Anti-Money Laundering (Towson) Flood Insurance (Towson) Errors & Omissions (Glen Burnie) Risk Management (Columbia)

Errors & Omissions, Identity Theft, and Risk Management (Glen Burnie, Rockville & Towson)

February 10

February 26

January 6-8 January 6 January 8 January 9 January 14 January 15 January 16

Long Term Care Partnership & Annuities (Glen Burnie)

Ethics, Insurance Fraud, and Anti-Money Laundering (Towson)

Principles of Banking (AIB)

Insurance

Ethics, Insurance Fraud, and Anti-Money Laundering (Rockville)

February 6

Ethics, Insurance Fraud, and Anti-Money Laundering (Rockville)

Complaint Management (Webinar)

Life & Health Combo Pre-Licensing (Towson)

Ethics, Insurance Fraud, and Anti-Money Laundering (Glen Burnie, St. Marys County & Towson)

Principles of Banking (AIB)

March 24-25 March 25

March 27

Long Term Care Partnership & Annuities (Glen Burnie)

Economics for Bankers (AIB)

Errors & Omissions, Identity Theft, and Risk Management (Glen Burnie)

Ethics, Insurance Fraud, and Anti-Money Laundering (Annapolis)

February 25

Accounting Basics (Webinar)

March 19

Ethics, Insurance Fraud, and Anti-Money Laundering (Frederick)

February 5

Ethics, Insurance Fraud, and Anti-Money Laundering (Glen Burnie)

Principles of Banking (AIB)

Errors & Omissions, Identity Theft, and Risk Management (Frederick)

Property & Casualty Pre-License (Glen Burnie) March 26

Law & Banking: Applications (AIB)

March 18

Health Insurance Pre-Licensing (Towson)

Errors & Omissions, Identity Theft, and Risk Management (Frederick)

Principles of Banking (AIB)

Flood Insurance & Underwriting (Towson)

Insurance Fraud (Silver Spring)

February 20

General Accounting (AIB)

March 11 March 17

Lending January 6 January 13 January 22 January 23 January 24 February 3 February 10

February 12 February 14 February 19 February 24 February 28 March 3

March 5 March 18-20 March 25 March 31

Analyzing Financial Statements (AIB) Consumer Lending (AIB) Financial Statement Analysis 1 (Webinar) Financial Statement Analysis 2 (Webinar) Cash Flow Analysis (Webinar) Analyzing Financial Statements (AIB) Commercial Lending (AIB) Loan Documentation 101 Part 1 (Webinar) Loan Documentation 101 Part 2 (Webinar) Loan Documentation 101 Part 3 (Webinar) Business Entities for Lenders (Webinar) Consumer Lending (AIB) Mortgage Lending: Start-to-Finish (Baltimore) Analyzing Financial Statements (AIB) Intro to Mortgage Lending (AIB) Personal Financial Statement Analysis (Webinar) Real Estate Compliance Seminar (Baltimore) Appraisal Regulations Update (Webinar) Analyzing Financial Statements (AIB)

Sales & Marketing February 10 Marketing Financial Services (AIB)

Trust February 10 ABA Online Review Course for the CTFA Exam (AIB) February 24 IRA Online Institute (AIB) March 3 Intro to Trust Products and Services (AIB)

A Local ABA Training Provider

For detailed and updated information on all professional development programs, visit the Calendar section of the MBA’s website at www.mdbankers.com.

30 | The Maryland Banker

With Operation 411, compliance isn’t a 911.

In the next few years, financial institutions will face mandatory changes to the self-service channel. Diebold is responding now, with Operation 411: 4 compliance requirements, from 1 company with 1 request. With Diebold as a proactive partner, you’ll be efficiently ahead of change to meet everything from Windows® 7 updates to PCI compliance. Operation 411.

It’s another example of how Diebold never stops watching the future, as it helps you now.

For the entire story, visit www.diebold.com/411.

requests@diebold.com www.diebold.com.