ABA Hot Flashes — CBA board member Bill Reid, CEO of The Mechanics Bank, has been officially elected to the American Bankers Association board. Great news on our continuing efforts to infiltrate and influence the national association with California attitude and expertise. Excellent link for CBA to be up-to-speed and pro-active on national issues affecting the other coast. Another board member, Linn Wiley CEO of Citizens Bank, attended the ABA conference in Washington last week with CBA CEO Gary Gertz, who is one of the few state association executives to hold a seat on ABA’s Federal Government Relations Committee. Among the hot topics was, of course, Privacy. CBA will keep its members informed on developments, and of course, provide support on implementation of Privacy policies and practices. Other ABA news: Donald Mengedoth of Community First Bankshares in Fargo, N.D., has been elected president, succeeding Hjalma Johnson, who delivered an intriguing speech at CBA’s annual conference in Hawaii.

Speaking of the ABA conference — Federal Chairman Alan Greenspan had a message for bankers: they’ve lost the crucial edge in financial information. “The explosion in the quantity and quality of information is reducing uncertainty, and that is particularly important because the banker’s stock in trade, the basis of an institution’s franchise value, is information.” He emphasized the “real-time” information of financial market operations and the impact on bankers: they can no longer expect to know more about market conditions than their customers or their competition.

On the Western front — Federal Reserve Bank President Robert T. Parry inspired some questions after he delivered an economic update — booming economy...longest expansion ...growth rates in excess of 4 percent for the last four years and a stunning 6 percent last year...unemployment low — to more than a hundred CBA members attending a seminar at the Federal Reserve in San Franicisco last week. Audience concerns included slower growth in money supply raising interest rates, credit union tax exempt status, payment system control, internet banking portfolio risks, and the SEC’s independent audit proposal cost ramifications for community bankers.

Chief Fed Regulator Terry Schwakopf spoke of safety and soundness issues for community banks. She characterized asset quality as “solid,” and warned that bank liquidity was weakening. Her message to bankers was to focus more on strategic plans rather than exit strategies.

Having trouble establishing credit? — Do you have bad credit, judgements, bankruptcies or any other credit problems? According to a new ad circulating on the Internet, it’s no longer a problem. For only $49.95 you can own “How to Legitimately Obtain a Second Credit File in 24 Hours” and learn how to wipe away bad credit history by establishing a clean, flawless credit profile. And, it is advertised as 100 percent legal and 100 percent legitimate. CBA State Government Relations Rep James Clark is checking with credit bureaus to see if this a popular, lucrative practice. More later.

In vetoing SB 796 — (Dunn), a bill that would require some colleges and universities to adopt policies governing the marketing of credit cards on campus, Governor Gray Davis wrote, “I am returning Senate Bill 796 without my signature. Personal responsibility can not be mandated by government...” Now the Governor has both the Republicans and Democrats confused.

Current Events - 09/25/2000