Bankers Di-March 29, 2004

March 29, 2004

VolumeB 124ankers A Weekly News Magazine Devoted to SouthwestD Banki News- Number 13 ICBA Elects Leighty Chairman, Taps New Officers, of Colorado School of Banking. In addition, the ICBA announced the Names Fine to Succeed Guenther as Pres/CEO retirement of Kenneth Guenther after 25 successful years as president and Oaks, NC. t its annual convention, the board CEO of the association and the selec- The current ICBA chairman, C.R. Aof directors of the Independent tion of Cam Fine as his successor. Fine (Rusty) Cloutier, presi- Community Bankers of previously served as president/CEO of dent/CEO, MidSouth America elected a new Midwest Independent Bank in Jefferson Bank, N.A., Lafayette, LA, slate of officers to serve City, MO, which he was instrumental in became the ICBA’s imme- in 2004-2005. The new founding in 1985. He earlier served in diate past chairman. ICBA officers elected the administration of former Missouri The two elected Direc- during the trade associa- Governor Kit Bond. tion’s 2004 National Con- tor-at-Large positions are (continued More than on Page 3,000 6) attendees represent- vention and Techworld in William Russell Caroth- San Diego are: Chairman ers II, chairman/presi- - Dale L. Leighty, chair- dent/CEO, Citizens Bank Teche Holding, St. Landry man/president/CEO, of Winfield, AL; and W. Financial to Merge Banks First National Bank of Everett Crawford, chair- eche Holding Co. and St. Landry Las Animas, CO; Chair- man/CEO, First National TFinancial Corp. have agreed to man-Elect -David E. Bank of Artesia, NM. merge their respective banking op- Hayes, president/CEO, Each serves on ICBA’s erations in a $10.1 million cash deal Security Bank, Dyersburg, TN; Vice- executive committee, the 11-member valued at 1.23x St. Landry’s diluted BV Chairman - Terry J. Jorde, presi- body that implements board of direc- at December 31, 2003. dent/CEO, CountryBank USA, Cando, tors’ policies. Franklin, Louisiana-based Teche ND; Secretary - George G. Andrews, Leighty is the chairman/president/ Holding is the parent company for $566 president/CEO, Capitol City Bank & CEO of the First National Bank of Las million-asset Teche Federal Savings Trust Co., Atlanta, GA; and Treasurer Animas, CO. He earned a BS degree in Bank. St. Landry Financial is the par- - Ayden R. Lee Jr., president/CEO, economics from Kansas State University ent company for $70 million-asset First Four Oaks Bank and Trust Co., Four and also graduated from the University Federal Savings and Loan Association of Opelousas. Colonial Bank – Texas Rowe Joins Arvest After the merger, Teche Holding will operated 19 branches in eight LA Taps Twiss SR Lender Bank As EVP, Central parishes Ark Q avid Twiss has been named senior hett B. Rowe has joined Arvest In This Issue... Dvice president, senior lender RBank in Little Rock, AR, as execu- for Colonial Bank – Texas. Twiss is a tive vice president, chief lending officer. New Privacy Rule for Health 20-year veteran of the Texas banking. He has over 15 years of commecial Care: HIPPA Privacy Rule He will direct lending operations for banking, financial services experience. Feature...... 3 Colonial Bank statewide. Twiss most Prior to going to Central Arkansas, Charter Update...... 12 recently served as branch president Rowe was EVP/senior lending officer for for Colonial’s Walnut Hill-Dallas and Texas State Bank, McAllen, TX. He is a Classified...... 13 Mesquite offices. graduate of the University of Michigan Twiss joined Colonial predecessor with a BA degree in economics and When you have read this copy, First Mercantile Bank in 1998 from Fi- holds an MBA degree in finance from please pass along. delity Bank, Dallas, where he was vice the University of Detroit. president for new business develop- Arvest has 33 locations in Central AR ment. He started his banking career in and total assets of $740 million. Arvest 1981 with Republic Bank Dallas as a Bank Group, Fayetteville, operates bank- commercial loan officer, after graduat- ing offices in AR, OK, and MOQ p e o p l e T E X A S Frost Bank Ups Falk to National Bank, Gatesville, First State Bank of Burnet in 1991 as SVP, Appoints Two, Austin Promotes Yancy, Chumley a loan secretary, gaining promotions P E O P L E to loan officer and then assistant vice rost Bank Austin Region President ational Bank, Gatesville, an- president. FBob Huthnance has announced Nnounced the recent promotions She earned a bachelors degree in the promotion of of Eledith Falk to of Sally Yancy to city president of the agri-business from Tarleton State senior vice presi- Lampasas branch and Gary Chumley University. dent, professional to vice president and commercial loan Chumley has 14 years of banking & executive lend- officer in the Gatesville branch. experience and 10 years with Bariod ing, Downtown Yancy began her tenure with the Lam- Petroleum Services in West Texas and Austin Financial pasas branch of National Bank in April Eastern New Mexico. He earned a BS Center. Falk, an 18- 1998. She is a 15-year banker, starting degree in agri-business from Tarleton year banker, earned as a teller for Citizens State Bank of State University and currently is attend- a BBA degree in Lometa and working her way up to ing the Southwestern Graduate School finance from UT- assistant cashier. She then moved to of Banking at SMU Q Austin. The bank has also promoted Laura Cobo to vice president, retirement services, at the Downtown Financial Center. She is a 28-year banker. Nellie Arana, a 15 year banker, was promoted to assistant vice president, manager of the North Austin Financial sentry Center Q Woodforest National Bank Taps Shaw EVP in Conroe oodforest National Bank, Hous- Wton, has announced that Kenny Shaw has joined the bank as executive vice president. He will manage the bank’s newest location in Crosby at 14045 FM 2100, suite 300 Q Bankers Digest® Established 1942 A Weekly Bank News Magazine (USPS 041180) Published every Monday at Dallas, Texas Copyright© 2004 Bankers Digest®

BONNIE JAMISON BLACKMAN, Publisher/Editor R. GILBERT BLACKMAN, Managing Editor 9550 Forest Lane, Suite 125 Dallas, Texas 75243-5928 Phone 214/221-4544 Fax 214/221-4546 E-mail: [email protected] website: www.bankersdigest.com Subscription rate: One year $29.00, single copy $1.00. Opinions expressed by columnists and writers of bylined articles are not necessarily those of Bankers Digest®. Editorial guidelines may be obtained upon request. Articles and photos BD COUPON may be submitted to above address or sent via e-mail. Periodical postage paid at Dallas, Texas. POST- MASTER: Send address changes to Bankers Digest, 9550 Forest Lane, Suite 125, Dallas, Texas 75243-5928.

Page BANKERS DIGEST March 29, 2004 F E A T U R E H I P A A The HIPAA Privacy Rule creates and unfunded, should use the total amount paid for healthcare claims by New Privacy Rule for national standards to protect individuals’ medical records and other personal the employer, plan sponsor, or benefit Health Care Affects Employers health information and gives patients fund on behalf of the plan during the by Bob McComas, more control over their health infor- plan’s last full fiscal year. Plans that banking industry mation. It sets limits on the use and provide health benefits through a mix of human resources advisor release of health records. It sets out purchased insurance and self-insurance Flower Mound, Texas safeguards that providers and health should combine the two measures to plans must implement to protect the determine their total annual receipts. T h e n e w privacy of health information. Self-insured plans that have stop- HIPAA Priva- As applied to employers, the Pri- loss insurance do not count the cost cy Rule that vacy Rule provides that, in general, a of the stop-loss coverage as premiums becomes ef- covered entity which includes employ- for health insurance benefits when cal- fective April ers as health care plan sponsors, may culating total receipts. The $5 million 14, 2004, for not use or disclose an individual’s threshold appears to apply separately health plans healthcare information without permis- to each group health plan that an em- with less than $5 million in “annual sion except for treatment, payment, or ployer sponsors. Another approach for receipts” is the first comprehensive healthcare operations. non-ERISA plans would be to examine federal protection for the privacy of Determining ‘Annual Receipts’ how the plan is disclosed to partici- health information. The Department of Health plans that do not report re- pants. Plans that are explained as sepa- Health and Human Services (HHS) has ceipts to the Internal Revenue Service rate entities and not part of a combined stated that the Privacy Rule, as modi- (IRS) on IRS Form 5500, should use package are more likely to be a separate fied, is carefully balanced to provide proxy measures to determine their plan for the small plan test. strong privacy protections that do not annual receipts. Fully insured health Basic Requirements interfere with patient access to, or the plans should use the amount of total Employers covered by the new quality of, healthcare delivery. This also premiums paid for health insurance Privacy Rule must train all members covers how employers handle employee benefits during the plan’s last full fiscal of its workforce so that they have an health information. year. Self-insured plans, both funded (continued on Page 6)

FINANCIAL DESIGN

March 29, 2004 BANKERS DIGEST Page p e o p l e T E X A S InterCon Bank, San Antonio, Frost Bank Appoints Bar- Comerica Names Officers Promotes Galvin to VP rera and Hamilton In Houston and Dallas nterCon Bank San Antonio, an- ccording to Raymond Jenkins, omerica Bank-Texas has an- Inounced the promotion of Billie J. Amarket president of Frost Bank-Rio Cnounced that Hal Marshall, senior Galvin to vice president - lending. Grande Valley, Patricia P . Barrera vice president of commercial real estate Galvin has served with the bank for has been appointed personal banking for the bank’s South Texas region, has three years and is a 25-year banker. Her officer, customer service, Harlingen been named alternate group manager experience includes service in business Financial Center. Barrera is an 11-year in Houston. development, financial analysis, and banker. Marshall joined Comerica in 2001, lending with a strong emphasis on the According to Earle Bolks, region presi- and is a 20-year banker with 15 years executive & professional markets Q dent of Frost Bank-Dallas, the bank has of commercial real estate lending appointed Lori Anne Hamilton invest- in Houston, El Paso, and Dallas. He Lone Star Bank, Alamo City, ment officer, financial management holds a BBA degree in acccounting and Names Peterson and Theiss group-investment services, Coppell finance from SMU. one Star Capital Bank, N.A., San Financial Center. She earned a BBA Frank J. Petras has been named se- LAntonio, announced that Calvin A. degree in finance from The University nior vice president of personal financial Peterson has been named operations of Texas at Arlington. She also holds services for the bank’s Texas Division. officer and branch manager of the Series 7, 8, 24, 63, and Group I licenses He is manager of Comerica’s office in LSCB Brook Hollow branch. Peterson and has 15 years of investment experi- Sugar Land. has been with the bank as a manager Petras began his banking career in ence Q for over two years and is a 30-year 1984 with Comerica predecessor Sugar banker. Bankers Digest Wants Your News! Creek National Bank, Sugar Land. He is John R. Theiss, formerly with NBC of Promotions, new officers, new branch- a graduate of the University of Houston Texas, was named information technol- es, mergers, etc. There is no charge and is completing graduate work at ogy officer. He is a 25-year banker. for this service. See Page 2 the Southwestern Graduate School of President and CEO B. W. McCandless for submission details. Banking at SMU. Lorraine P. Evans and Juan Munoz have been promoted to vice president in Houston. Evans serves as a business development officer for personal financial services, and Munoz is a relationship manager of private banking. Both joined the bank in 2003. In Dallas, Rosie Fayson, Amy N. Moore, Paul J. Orsborn, and Peter F. Sefzik have been named vice president. Fayson, a Comerica banker since 2003, serves as a business development officer in municipal banking. Moore joined Comerica in 2003 and serves in private banking. Orsborn, a seven-year Com- erica banker, serves in small business BANK DESIGN-growing pains banking. Sefzik joined the bank in 1999 and serves in energy finance Q

Stavenhagen Joins First American Bank in Amarillo erri Stavenhagen has joined First TAmerican Bank, SSB, Bryan, as branch manager of the bank’s newest Amarillo banking center at the intersec- tion of Amarillo Boulevard and Gem Lake Road in Amarillo. The branch will open later in 2004. Stavenhagen is temporarily serving at 5100 S Coulter Street branch Q Page BANKERS DIGEST March 29, 2004 MCCOY-new ad copy

March 29, 2004 BANKERS DIGEST Page p e o p l e L O U I S I A N A Hibernia Promotes have been promoted to vice president. Retired St. James Bank, Alfred Din has been hired as a vice Lutcher, VP Giardina Dies Four to Senior VP president. ibernia National Bank, New Or- Michelle Barquero, Gale Gettridge- erna Kroll Giardina, a retired vice Hleans, announced the following Brannon, Shana Naquin, and Pass Vpresident of St. James Bank & Trust promotions and hirings. Travis have been promoted to assistant Co., Lutcher, died February 28 at River Joseph Caruso, David Harrison, Sha- vice president. Alvin Haley, Matthew Parishes hospital. She was 76. Giardina ron Daly-Hamblin, and Noel Trusty Klaus, and Brian Thome have been was a lifelong resident of Gramercy Q have been promoted to senior vice hired as assistant vice presidents Q ICBA(continued from Page 1) president. ing every state in the nation gathered Steven Larmann, Laurie Pequeno at the San Diego Marriott and Conven- Lewis, Kevin Rogers, and Tony King A R K A N S A S tion Center March 14 for the event. The Montgomery and Burton Promoted at Portland State Bank convention featured Federal Reserve Chairman Alan Greenspan, FDIC Chair- ortland State Bank has announced a BBA degree in marketing from the man Donald E. Powell, Federal Housing Pthat Brian Montgomery was University of AR at Monticello. Finance Board Chairman John T. Kor- promoted to assistant vice president. Kelly Burton was promoted to smo, Operation HOPE Chairman and Montgomery serves as a loan officer mortgage loan officer. She began her CEO John Bryant, and former Wyoming at the Monticello branch. He received banking career as teller in 1988.Q US Senator Alan Simpson, as well as 70 workshops on such subjects as technol- ogy, lending, regulations, marketing and strategic planning. The convention also offered industry’s largest trade show called Techworld Q VERDE HIPAA (continued from Page 3) understanding and knowledge of the Privacy Rule and the Rule’s impact on employees’ job responsibilities. Af- fected employees must also be trained on the entity’s own privacy policies and procedures that impact their job duties. Individuals who have primary respon- sibility for requesting, handling, and HIPAA-protected health information (PHI) must be given more intensive training than individuals who have limited contact with PHI. All employees who have contact with PHI, however, must understand what they can and cannot do with such information and the consequences of failing to comply with the Privacy Rule. Requirement for new Policies and Procedures FINANCIAL NETWORK Affected employers are required to implement new policies and procedures that protect the creation, processing, and desimenation of PHI. There are 13-17 new policies established in the regulations, depending on the requirements of the employer. In addition, training on the policies and procedures with respect to PHI must be provided no later than the compliance date for the

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Page BANKERS DIGEST March 29, 2004 p e o p l e O K L A H O M A N E W M E X I C O Quail Creek Bank Names Retired First Tulsa VP and First State Bank Appoints Farrell and Ups Crabtree Auditor, Wall Dies at Age 93 Dennis as Vice President uail Creek Bank, N.A., Oklahoma ouis Thomas Wall, a retired vice irst State Bank of NM, Taos, has QCity, has announced changes in Lpresident of First National Bank Fappointed Jennifer Dennis vice the leadership of the Quail Classic and Trust Co., Tulsa, died March 1 at president, relationship manager. Den- Club due to the retirement of Eula Gil- age 93. nis will serve in business development. lenwater. The bank has named Mary Wall was born February 15, 1911, in She will generate deposits and loans, Muskogee and moved to Tulsa in 1913. Farrell, vice president, manager over introduce banking products and ser- He studied at the Oklahoma School of the club activities. vices as well as manage the customers’ Accountancy and later at the University The Quail Classic Club membership is entire banking process. She will office of Wisconsin School of Banking. for depositors over age 55 and includes at First State Bank’s Juan Tabo branch at He began his banking career at the First many bank services at no charge. Cur- Tulsa in 1930. He was named assistant 3620 Juan Tabo NE in Albuquerque. rently, the club has a membership in auditor in 1942, auditor in 1948, as- Dennis’ seven years of banking ex- excess of 1,400. The bank has also an- sistant vice president in 1953, and vice perience most recently includes branch nounced the addition of enhancements president and auditor in 1957. He held manager for First Union National Bank such as educational and informative that position until he retired in 1974. in Ansonia, CT, and roving area manager seminars. His many contributions to First Tulsa for Wachovia Bank, Northern CT/NY. Quail Creek Bank has promoted John included establishing the operating pro- She holds a certificate in lower pri- Crabtree to head teller. He joined Quail cedures of Tulsa’s first-ever AutoBank at mary education and a masters degree Creek Bank in 1998 and has served in 6th and Boston in 1954, and planning in education from Roggebaai Teachers banking since 1982. He earlier served the layout and space requirements for College, Cape Town, South Africa. with Liberty National Bank in Okla- the bank’s move to the 41-story First of James Warden, executive vice presi- homa City. Tulsa Tower in 1971. dent for branch administration, made He was a former president of the OK Crabtree attended the University of the announcement Q Association of Bank Auditors and Oklahoma and UCO Q

TIB mortgage

March 29, 2004 BANKERS DIGEST Page p e o p l e N E W M E X I C O First of Santa Fe’s Ellena Is President of Holding Marcum Named Pres/CEO, US NM Federal Credit regory J. Ellena, president of First company. He is principally involved with GNational Bank of Santa Fe’s the bank’s capital structuring, securities teve Marcum has been promoted Albuquerque of- portfolion management, and market Sto president and CEO of the US fice, has added the expansion and development. Prior to New Mexico Federal Credit Union, title of president of joining First National, he served in the Albuquerque. Marcum joined the New Mexico Ban- Denver, CO, banking market. credit union in 2001 as the senior vice quest Corporation, Ellena graduated cum laude from Har- president of commercial lending. He the bank’s holding vard University with a AB degree in has 20 years experience in commercial company. economics. He shares senior He serves on the boards of the Al- HIPAA (continued from Page 6) management du- buquerque Museum Foundation, the covered entity. Compliance dates are ties at the holding Presbyterian HealthcareFoundation, April 14 of 2003 or 2004, depending on company with Ed- and the NM Symphony Orchestra. the size of the plan. Each new member ward B. Bennett, chairman and CEO, of Ellena is also a member of the of the workforce must be trained within the bank and the holding company. Economic Forum and the National a reasonable period of time after the Ellena, a 20-year banker, serves on Association of Industrial and Office person joins the covered entity’s work- the boards of the bank and the holding Properties Q force. Each member of the covered entity’s workforce whose functions are affected by a material change in the policies or procedures must receive training within a reasonable period of time after the material change becomes effective. NATIONAL FINANCIAL The job descriptions of all individuals who will have access to PHI should specify their duties and include a provi- sion explaining their obligations under the Privacy Rule. A covered entity must document that the training has been provided. While there are some exemptions to what is defined as PHI, most medical records and data in the employer’s possession are considered as PHI and covered under the new law. Sanctions for Non-compliance. In order to make sure those individuals who handle PHI understand the need for privacy, civil and criminal pen- AUDIOTEL alties for violation have been added. The civil fines are $100 per violation, up to $25,000 per year for each standard violated. There are serious criminal penalties for wrongful disclosure of PHI of up to $50,000 in fines and a year in prison. The penalty for disclosure under false pretenses can be as high as $100,000 and five years in prison. Disclosure with intent to sell or for commercial gain is punishable by fines of up to $250,000 and 10 years in prison. Enforcement of the Privacy Rule will (continued on Page 12)

Page BANKERS DIGEST March 29, 2004