July 31, 2006 www.bankersdigest.com Volume 129, No. 5 Vandaveer Inducted as Chairman of the Prosperity Bancshares, Bankers Association for 2006-2007 United to Merge Tuttle, Oklahoma, banker Gregg Vandaveer has served as president Prosperity Bancshares Inc., , Vandaveer was inducted as chairman of Sooner State Bank since 2001 TX, announced on July 19 that it has of the Oklahoma Bankers and has been involved in agreed to buy La Grange, TX-based Association on July 12 various civic and public Texas United Bancshares Inc. for $357.1 during the Oklahoma organizations. million in stock. Bankers Association’s Also at the convention, Texas United, through its four sub- annual convention. Don Abernathy Jr., sidiary banks in La Grange, Dallas, The 109th OBA president and CEO of The Gainesville, and Roanoke, operates Convention and Trade Bankers Bank in Oklahoma 43 banking centers. At June 30, 2006, Show was held July 10-12 City, was elected vice Texas United had assets of $1.82 bil- at the Cox Convention chairman; he will become lion, loans of $1.26 billion, deposits of Center in Oklahoma City. chairman in 2007. Bradley $1.32 billion, and shareholders’ equity Vandaveer, president and W. Krieger, chairman of of $169.3 million. CEO of Sooner State Bank Arvest Bank in Oklahoma Prosperity reported the merger will in Tuttle, accepted the City, became OBA first vice create a banking company with 131 OBA chairman’s gavel chairman and is slated branches within the state’s greatest from 2005-2006 Chairman R. Dale to take over as chairman in 2008. See population and wealth concentration. Nichols, president and CEO of First related story on Page 6 for election of The combined company will have a to- National Bank in Wewoka, during a six new directors and honors for five tal of 70 branches in the Houston CMSA ceremony on July 12. retiring directors and the Dallas/Fort Worth area. Q Texas United president/CEO L. Don Stricklin will become a director of Manning Named Chm, Scheer Is President, Prosperity Bancshares and Prosperity Citizens of Las Cruces First SB Flower Mound Bank, El Campo, upon consumma- Citizens Bank of Las Cruces, NM, has William H. “Bill” Ellis, chairman/CEO tion of the transaction, and EVP of the named Hotch Manning chairman of the of $110 million First Security Bank, holding company and vice chairman of board. He was secretary of the board, Flower Mound, TX, Prosperity Bank. as well as executive vice president, has announced The transaction is subject to neces- sary approvals, and operational inte- and succeeds James Ikard who died the promotion of gration is expected to begin in the first in April. Frank Scheer to quarter of 2007 Manning, 65, is the third chairman president. Scheer Q since the bank opened in April 1970. has 27 years in the Please route this issue : Justin Harper, president/CEO of the financial services bank, made the announcement. industry, including 18 years of service Harper said that Las Crucens should in banking in Flower In This Issue... expect to “see us put some new branch- Mound. He has Forged Check Signatures, Part 2 es out there the next couple of years.” served with First Security Bank since it Legal Phases...... 3 He also said that the bank has pur- opened in Flower Mound in 1997, most chased land near the corner of Motel recently as executive vice president Blvd. and Picacho Avenue. and director. Charter Activity...... 12 Manning has served with Citizens He is a graduate of the Southwestern Bank for nearly 20 years. Graduate School of Banking at SMU and He earlier owned several businesses the IBAT’s Compliance School. Classified...... 13 after leaving the Air Force in 1978 Q Ellis will remain CEO and chairman p e o p l e TEXAS Frost Ups Eippert and White to SVP in Alamo City Happel Is President of According to Don Frost, the bank has promoted three and named Compass Bank-FW region president of Frost National two officers. Debbie Eippert Compass Bank has named Brian w a s p r o m o t e d Happel president of Compass Bank- to senior vice Fort Worth. Happel president, private joined Compass as trust services. She senior vice presi- dent, corporate has over 23 years banking manager of experience in for Tarrant County, banking. this spring from Mary Ann White was Chase Bank. promoted to senior Compass also an- vice president, nounced that Stan private trust services. She has over O’Neil, president of 25 years banking North Tarrant County, has expanded his RED BOOK experience. responsibilities to include Denton. Dora E. Tays Wade Wallace will continue with his was promoted to responsibilities as regional president vice president, for the Weatherford, Granbury, and i n t e r n a t i o n a l Cleburne markets, Compass officials department. said Q Frost has named Cherie E. Dubay to administrative Bryant to Retire from officer, commercial lending, andAlison Compass Bank-Fort Worth M. Williams to administrative officer. Veteran Fort Worth banker Vernon Bry- According to Fred Stumberg, ant has retired from Compass Bank, market president in Boerne, Frost has the company announced on July 13, as promoted eight-year banker Loretta reported by Robert Francis of the Fort Bernhard to assistant vice president Worth Business Press. Bryant said he will in personal banking at the Fair Oaks officially retire at the end of July. Financial Center. Bryant was president/CEO of Texas- According to John Schott, market Bank, Fort Worth, which was acquired president in San Marcos, Frost has named Stephanie E. Lyles relationship by Compass Bank in October 2005. Bankers Di- banking officer/ commercial lending at Following the completion of the ac- Established 1942 quisition in April 2006, he served as A Weekly Bank News Magazine the Guadalupe Financial Center. The (USPS 041180) eight-year banker earned a BBA degree Compass’ regional executive for Tarrant Published every Monday at Dallas, Texas in finance from Texas A&M University County.

® Bryant, a banker since 1982, is a Copyright 2006 Bankers Digest Q BONNIE JAMISON BLACKMAN, Publisher/Editor former chairman of the Texas Finance R. GILBERT BLACKMAN, Managing Editor Commission. He is also active in the 9550 Forest Lane, Suite 125 community and is currently chairman of Dallas, Texas 75243-5928 Phone 214/221-4544 NEED A the Fort Worth Chamber of Commerce Fax 214/221-4546 SUBSCRIPTION? E-mail: [email protected] Oasis Bank Taps Sex- website: www.bankersdigest.com Subscription rate: ton Chm, Adds Direc- One year $32.00, single copy $1.00 CHANGE AN Opinions expressed by columnists and writ- John Sexton has joined de novo Oasis ers of bylined articles are not necessarily ADDRESS OR NAME? Bank SSB, Houston, as chairman of the those of Bankers Digest. Editorial guidelines board. The following have joined the may be obtained upon request. Articles and photos may be submitted to above address Visit Bankers Digest on-line: bank’s board of directors: A. J. Rincon, or sent via e-mail. www.bankersdigest.com Scott Shields, Joel I. Spira, and Dr. Periodical postage paid at Dallas, Texas Alan W. Yasko. POSTMASTER: Send address changes to or call 214/221-4544 Bankers Digest®, 9550 Forest Lane, Suite 125, Joining the bank’s board of advisors Dallas, Texas 75243-5928. is George Donnelly Q Page  BANKERS DIGEST July 31, 2006 l e g a l p h a s e s RISK MANAGEMENT UCC § 3.406(c) provides that, “under a bank that takes an instrument for Subsection (a), the burden of proving processing for collection or payment Forged Check Signatures, failure to exercise ordinary care is on by automated means, reasonable Part 2 the person asserting the preclusion. commercial standards do not require Under Subsection (b), the burden of the bank to examine the instrument if Jerry G. Sanchez proving failure to exercise ordinary care the failure to examine does not violate Bracewell & Giuliani, L.L.P. is on the person precluded.” the bank’s prescribed procedures and Dallas, Texas However, even a negligent depositor the bank’s procedures do not vary www.bracewellgiuliani.com is not precluded from asserting a claim unreasonably from general banking against a paying bank for funds paid out usage not disapproved by this chapter A Customer’s upon forged checks if he establishes or Chapter 4. N e g l i g e n c e that the bank’s payment of the forged B. Customer’s Duty to Discover Contributing checks was not in accordance with Unauthorized Signature/Limitations t o F o r g e d reasonable commercial standards.3 Under Texas Business & Commerce Signature Thus, the drawer may assert that the Code § 4.406(c), a bank customer must bank’s failure to manually inspect exercise “reasonable promptness” each check constituted a failure to in examining statements or items Continued from last week. exercise ordinary care; however, that paid and “promptly” notify a bank UCC § 3.406(a) provides that, “a practice is in keeping with industry of any unauthorized signatures or person whose failure to exercise standards and expert testimony may alterations. UCC § 4.406(a) gives a ordinary care substantially contributes be utilized to establish this principle. bank customer 30 days from the time to an alteration of an instrument or Under UCC § 3.103(a)(9), “ordinary a statement or item is made available to the making of a forged signature care” is defined as: in the case of a to notify a bank of an unauthorized on an instrument or the making of a person engaged in business means signature or alteration if a bank has forged signature on an instrument, is observance of reasonable commercial suffered a series of losses caused by the precluded from asserting the alteration standards, prevailing in the area in same wrongdoer (i.e., “repeater rule”). or the forgery against a person who in which the person is located, with Additionally, UCC § 4.406(f) provides good faith, pays the instrument or takes respect to the business in which the that, “Without regard to care or lack it for value or for collection.” person is engaged. In the case of (continued on Page 11) If a drawer’s procedure for handling of checks was lax, and thus negligent, that alone would not satisfy the requirement that the negligence “substantially contribute” to the making of an unauthorized signature thereby precluding the drawer from asserting lack of authority against a bank that paid the check in good faith.1 Also, one court has held that to constitute a defense to a bank’s liability for negligence in accepting checks with unauthorized signatures, the contributory negligence of the drawer must have been the proximate cause of the loss.2 For example, an employer’s failure to SENTRY detect an employee’s forged drawer signatures on company checks (payable to the employee and/or others) over an extended period of time supports a claim that the employer’s negligence contributed to the forgery loss. UCC § 3.406(b) provides that if, “a person asserting the preclusion fails to exercise ordinary care in paying or taking the instrument and that failure contributes to the loss, the loss is allocated between the person precluded and the person asserting the preclusion according to the extent to which the failure of each to exercise ordinary care contributed to the loss.” July 31, 2006 BANKERS DIGEST Page  p e o p l e TEXAS Southwest Securities FSB Taps Spencer to Cady Promoted to SVP, Lead North Dallas Expansion Community B&T, Waco Arlington-based Southwest Securities Earlier in his career, Spencer served Community Bank & Trust, Waco, has FSB announced as senior loan officer for Equitable announced the plans to expand Bankshares and executive vice presi- promotion of Pat into North Dallas dent of Equitable Bank of Dallas, and Cady to senior vice with a new banking with Texas American Bank in Fort president. center headed by Worth. C a d y j o i n e d Wayne A. Spencer, Spencer will be joined by Kristan A. Community Bank the former presi- Hall, senior vice president in charge & Trust in May dent and CEO of of real estate lending; Mickie Foster, 1975. In 1989, Texas Community assistant vice president for deposit she was promoted Bank and Trust in services; and Rosalind Reese, assistant to assistant vice Dallas. vice president. All previously served president in new accounts and further promoted to vice The new North Dallas location, which at Texas Community Bank , which was president in 2001. She was named had not been announced at press time, branch manager of the 8820 Chapel Rd. will give the bank seven locations: three Cartwright Is Audit Officer, office in November 2005 in Arlington, one in Granbury, one in Broadway in San Antonio Q Garland, and two in Dallas. Haru Cartwright has been hired as PlainsCapital Bank Names Spencer is a graduate of the South- audit officer I for the internal audit western Graduate School of Banking at department at Broadway Bank in San Gutierrez Mgr in San Anto- Dallas-based PlainsCapital Bank reports SMU, holds an MBA degree in finance Antonio. She recently served as a port- it plans to open a second location in the and management from TCU, and earned folio accountant for Capital Guardian San Antonio market in September. a BBA degree from The University of Trust Co. and holds a degree in account- Mike Molak, executive vice president Texas at Austin. ing from The University of Texas at San for the bank’s local operations, told Tamarind Phinisee of the San Antonio Business Journal that the bank’s next planned branch will be opened on the city’s North Side in the Stone Oak area at the StoneTerra Building at Sonterra Boulevard and Stone Oak Parkway. The bank has a location in The Renaissance Building at 70 NE Loop 410, Suite 100. Heading the Stone Oak location will be banking veteran Connie Gutierrez. STATE BANK- 3 TIER The 30-year banker specializes in com- mercial lending with an emphasis in the medical industry Q Retired Trust Banker Cour- tright Dies at Age 72 Kenneth Paul Courtright, age 72, died at this home in San Antonio on July 1. He was born December 1, 1933, in Brownwood. He graduated in 1955 with a degree in accounting from Abilene Christian University and served in the U.S. Navy from 1955 to 1958. In 1965, he gradu- ated from The University of Texas at Austin School of Law. His 30-year career in law and trust banking was spent in San Angelo, Abilene, and San Antonio Q Page  BANKERS DIGEST July 31, 2006 ELAN #3/key chains

July 31, 2006 BANKERS DIGEST Page  p e o p l e OKLAHOMA Norvell Named to SVP, OBA Announces Six New Directors and Bank of Oklahoma Honors Five Retiring Directors Bank of Oklahoma, N.A., Tulsa, re- At its recent convention in Oklahoma CEO, Valliance Bank, N.A., Oklahoma cently announced that Scott Norvell City, the OBA membership elected City; and Joseph W. Hidy, president and was promoted to bankers to six seats on the OBA board CEO, Triad Bank, N.A., Tulsa. senior vice presi- of directors. The new directors, who The OBA also announced that five dent/manager, par- will serve three-year board terms and directors completed their terms and ticipant services, represent the lower one-third of deposits were also recognized for their three in the commercial in each of the six geographic groups, years of service. Honored were: Doug division. Stanley A. include: Jeff L. Dickey, vice president, Tippens, Canadian State Bank, Yukon; Lybarger, president Southwest National Bank, Weatherford; Todd Russ, Washita State Bank, Burns and CEO, made the Chad F. Muegge, president, State Flat; Dirk Bagenstos, Alfalfa County announcement. Exchange Bank, Lamont; Marty Hansen, Bank, Cherokee; H.C. Bauman, The president and CEO, First State Bank, N o r v e l l h a s Bank of Wyandotte and First State Bank Fairfax; Kim A. Wheeler, executive vice of Picher; and , served with the bank since April 2005 Richard E. “Gene” Cobb president and director, Stroud National First State Bank of Elmore City Q Bank; Brad Swickey, president and MidFirst Taps Deimund Mkt President, Edmond Kent Is SVP, McDaniel VP, Bank of Commerce Tim Deimund has joined MidFirst Bank, James Berry, cashier of Bank of Com- nomics from OSU and is an eight-year Oklahoma City, as the new Edmond merce, Wetumka, has announced re- bank employee. market president. cent promotions. Debbie McDaniel was promoted to Prior to joining MidFirst, he served as Brad Kent was promoted to senior vice president, consumer lending. She vice president of commercial lending at vice president. The lending officer has 27 years of banking experience with Coppermark Bank in Edmond Q earned a BS degree in agriculture eco Bank of Commerce Q

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Page  BANKERS DIGEST July 31, 2006 P E O P L E ARKANSAS Ewing and Hogue SVPs, Bank of Fayette- The Bank of Fayetteville recently an- nounced two executive promotions. Theresa Ewing was promoted to se- nior vice president and trust manager. Her new duties include overseeing the day-to-day functions of the trust department. She has served with the bank for four years and was previously vice president and trust officer. Todd Hogue was promoted to se- nior vice president and risk manager. His new duties include overseeing the day-to-day functions of the risk man- agement department, which includes APORIA compliance, security, and auditing. He has served with the bank for four years and was previously vice president and compliance officerQ First Security Bank Hires Marshall as EVP First Security Bank, Searcy, has an- nounced that Andy Marshall is the newest member of its management team in Little Rock. He will oversee the bank’s Little Rock commercial lending efforts as executive vice president, Central Arkansas Q

OKLAHOMA Bass Elected EVP at First NBT of McAlester First National Bank & Trust Company of McAlester has elected Boyd Bass executive vice president. He has served with the bank for 27 years and continues as a bank director. E. Jane Auld, chief financial officer, has been elected secretary to the board of directors. She has served with the bank for 24 years Q

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July 31, 2006 BANKERS DIGEST Page  p e o p l e ARIZONA NEW MEXICO MidFirst Taps Nelson SVP/Commercial Services FNB of Santa Fe Elects MidFirst Bank, Oklahoma City, has Nelson to senior vice president/ Daniels Chairman, Davis VP announced the appointment of Virginia c o m m e r c i a l First National Bank of Santa Fe has services of its new announced that Jeannine Daniels has Arizona banking been elected chairman of the board. division. She will She has had a long-standing successful lead the commercial entrepreneurial career and is currently s e r v i c e s t e a m owner of D’ Elegance Jewelry in Albu- in Arizona and querque. Oklahoma, as well For over 20 years, Daniels has been as the commercial instrumental in the organizational and l e n d i n g s a l e s fund-raising activities of numerous New and prospecting Mexico charities and institutions. ABC efforts. Susan Sinclair Davis has been pro- Nelson, an Arizona native, moted to vice president and training most recently served as a business director. She has served with First Na- development officer at Wells Fargo tional Bank since 2004 and has worked Bank where she created and managed in the training department of banks for a formal calling program within the 25 years. She is the board secretary for bank’s commercial banking office. She Girls Inc. of Santa Fe Q has also served as treasurer at Finova Capital Corporation. She earlier served Pierce Joins Wells Fargo in commercial services with First Private Client Services Joni Pierce, CFA, a 25-year financial Klussman Named Area Ex- services veteran, has joined Wells Fargo ecutive, IronStone Bank Private Client Services as a regional investment manager in Albuquerque. IronStone Bank, a $1.5 billion-asset She serves at the 200 Lomas Blvd. bank, has named Monica Klussman location. area executive for the Scottsdale Prior to joining Wells Fargo, Pierce market. She serves at the bank’s western served for seven years as a market division administrative office at the investment executive for Bank of 7001 N. Scottsdale Road. The bank has America. Her previous experience two locations in Scottsdale Q includes 12 years as a portfolio manager for Wells Fargo predecessor banks. A Chartered Financial Analyst, she is a member of the CFA Institute and serves as a Presidents Council Representative for the South Central U.S., Latin, and South America region. She is a member of the CFA Society of New Mexico, the New Mexico Estate Planning Council, and the Estate Planning Council of Santa Fe. Pierce earned a BBA degree and an MBA degree in finance from the University of Nebraska in Lincoln Q SUMMIT Correction The following is a correction of a story in the July 17, 2006, issue: Doug Stone, Portales National Bank, is the current president of the Independent Community Bankers of New Mexico, and David Wiberg, City Bank New Mexico-Ruidoso, is the association’s president-elect Q Page  BANKERS DIGEST July 31, 2006