July 2019 Volume 45 • Issue 4 OFFICIAL PUBLICATION OF THE CoMMUNITY BANKERS ASSOCIATION OF ILLINOIS How to Invest in a Flat 2019 Annual Community Banking Yield Curve without Scholarship Program: Week: So Many Ways Getting Burned Winners Announced to Celebrate! page 08 page 14 page 18 Community Bankers Association of Illinois EXECUTIVE COMMITTEE CBAI PAST CHAIRMEN CONSULTANT + Chairman - Tony Sisto, + Todd Grayson, + Bob Wingert, CBAI, Springfield STC Capital Bank, St. Charles South Central Bank, N.A., Chicago <[email protected]> <[email protected]> <[email protected]> + First Vice Chairman - David Pirsein, + Kevin Beckemeyer, Legence Bank, Eldorado LEGISLATIVE TAFF First National Bank in Pinckneyville <[email protected]> CONSULTANT S <[email protected]> + Tom Marantz, Bank of Springfield + David Manning + Second Vice Chairman – Shawn Davis, <[email protected]> <[email protected]> CNB Bank & Trust, N.A., Carlinville <[email protected]> ICBA STATE DELEGATES + Regional Vice Chairmen - David Stanton, CBSC EXECUTIVE STAFF + Bill Wubben, Apple River State Bank PeopleFirst Bank, Joliet + Mike Kelley, President <[email protected]> <[email protected]> <[email protected]> + Mike Estes, The Fisher National Bank + Doug Parrott, State Bank of Toulon + Mike Duke, Vice President Services <[email protected]> <[email protected]> <[email protected]> + Chad Martin, Goodfield State Bank + Andy Burkett, Vice President Member Services IRECTORS & <[email protected]> AT-LARGE DIRECTORS Downstate Illinois D + Dan Graham, Flora Bank & Trust + Sheila Burcham, Community Trust Bank, Irvington <[email protected]> <[email protected]> <[email protected]> + Lesa Black, Vice President Member Services + Treasurer - Jeff Bonnett, + Dianna Torman, Prairie Community Bank, Marengo Northern Illinois Havana National Bank <[email protected]> <[email protected]> <[email protected]> + Immediate Past Chairman - Gregg Roegge, HEADQUARTERS Rushville State Bank CDD CHAIRMAN <[email protected]> (EX OFFICIO) 901 Community Drive, Springfield, IL 62703-5184 • 217/529-2265 • 800/736-2224 • Fax for CBAI + Kraig Lounsberry, CBAI President + Ryan Heiser, The Fisher National Bank <[email protected]> (except for Departments below): 217/529-9484 • BOARD OF <[email protected]> Fax for Departments of Communications, Education, and Special Events: 217/585-8738 • Fax for CBSC: GROUP DIRECTORS CBAI EXECUTIVE STAFF 217/585-8735 • www.cbai.com • Hours + Patrick McShane, + Kraig Lounsberry, President of Operation: 8 a.m. - 5 p.m. CBAI American Metro Bank, Chicago <[email protected]> <[email protected]> + Jerry Cavanaugh, General Counsel Faxed copies of articles will not be accepted for + Steve Feith, Waterman State Bank <[email protected]> publication in Banknotes; a hard-copy must be sent, <[email protected]> + Levette Shade, Paralegal preferably accompanied by the article on c.d. 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This publication of the Community + Kevin Day, State Bank of Waterloo <[email protected]> Bankers Association of Illinois is intended and <[email protected]> + Tracy Z. McQuinn, designed to provide accurate and authoritative + Mike Radliff, First National Bank, Vandalia Senior Vice President Education & Special Events information regarding the subject matter covered. <[email protected]> <[email protected]> + Melinda McClelland, Vice President These services are provided with the understanding + Travis Clem, South Porte Bank, Marion Education & Special Events that the Community Bankers Association of Illinois is <[email protected]> <[email protected]> not engaged in rendering specific legal, accounting, + Jennifer Nika, Vice President Education & or other professional services. If specific legal advice Special Events < [email protected]> or other expert assistance is required, the services of + Terry Griffin, Vice President Chicago Area a competent, professional person should be sought. <[email protected]> 4 www.cbai.com + Community Bankers Association of Illinois July 2019 08 14 18 features How to Invest in a Flat Yield Curve without Getting Burned . 08 CBAI’s 37th Annual Call on Washington . .10 . CBAI’s 35th Annual Capital Conference Recap . 12. 2019 Annual Scholarship Program: Winners Announced . 14 2019 Annual Scholarship Program: Statewide Winning Essay . 15 Combat the Threat of Wire Fraud . .16 . Community Banking Week - So Many Ways to Celebrate! . 18 Friday Night Event at CBAI’s Convention: Be a Rock Star for the Foundation! . 21 ICBA President Romero Rainey to Address CBAI Members at Annual Convention . 22 CBAI Supports “Capitol Community” Events . 24 2019 CBAI Community Bank Marketing Conference . .26 . CBAI’s Residential Real Estate Lending Institute. 28. 2019 CBAI Annual Scholarship Program: Member Banks’ Local Scholarships . 35. CBAI Recognition Programs . 36. James Renn Receives Distinguished Member Award . 37 departments Foundation Report . 29 In Memoriam . 29 Legal Link . 30 Member News . 32. Welcome New Members . 34. Coming Attractions . .41 . Published for Editor To submit editorial or Published by Community Bankers Valerie Johnston request information — E&M Consulting, Inc. 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We take no responsibility regarding representations or warranties concerning the content of advertisements of products/services for a particular use, including all information, graphics, copyrighted materials, and assertions included in the advertisements. The reader is advised to independently check all information before basing decisions on such information. 6 www.cbai.com + Banknotes Community Bankers Association of Illinois How to Invest in a Flat Yield Curve Without Getting Burned Ryan Hayhurst, Managing Director of the Financial Strategies Group, The Baker Group, Oklahoma City, OK n March 22, something happened that hasn’t Bernanke said in March 2006 that he “would not interpret happened in a long time: the yield on the three- the currently very flat yield curve as indicating a significant month U.S. Treasury Bill rose above the yield economic slowdown to come.” The Great Recession began on the 10-year Treasury Note. The yield curve the very next year. While we do not know for certain whether Oofficially inverted for the first time since August 2007. Almost this current inversion foretells a coming recession, community on cue, all the talking heads were paraded out on CNBC and banks are wise not to dismiss it out of hand. Bloomberg Television to tell us that a yield curve inversion Investing in a Flat or Inverted Yield Curve normally precedes a recession, but no one seemed to say With short term Treasuries and even Fed funds yielding more what we should do about it. Should banks stop making loans? than intermediate or longer-term bonds, deciding what to buy How