The Sub S Bank Report – September 2016 (Volume 19, Issue 3)

We continue to see banks and bank holding companies whose S corp election has terminated inadvertently as a result of action or inaction on the part of a shareholder. This is a serious problem given the potential implications of a termination of one’s Sub S election, particularly when one considers the implications on the corporation’s and shareholder’s tax liabilities.

Fortunately, there are generally remedies available though they are costly and time consuming. If a terminating event is discovered within three years of its occurrence, the IRS has issued a Revenue Procedure that is a relatively simplified way of curing the inadvertent termination. However, if the terminating event goes beyond the three-year period, a private letter ruling (PLR) must be requested from the IRS to cure the termination. This is a much more complicated, costly and involved process. The good news is that most often, a well-planned and organized effort can be successful in curing the termination.

The current IRS filing fee for a PLR in the case of an S corp termination is $28,500. The legal fees involved in investigating the facts and preparing the PLR can be significantly more than the filing fees, largely as a result of the initial review necessary to verify the S election or its termination and the extensive requirements of the IRS PLR. Finally, there are generally numerous other corporate and shareholder management issues that need to be dealt with in the process, including enforcing indemnification provisions of shareholder agreements against the offending shareholders and coordinating and soliciting the consent of all shareholders to certain conditions generally required by the IRS in such cases.

Based on our experience oveover the past 5 years, we estimate that 20% or more of S corp banks are operating with terminated S elections. If this is accurate, there are over 600 banks in the US that believe they have a valid Sub S election… but do not. The risk is that at some point the IRS takes the position that the Company had the power to prevent the terminating event from occurring and did not, and therefore would deny the cure of the terminating event and reinstatement of the S election from the date of termination. Further, we have seen banks that decided to do a capital transaction, including a sale that involved third parties conducting due diligence on the bank, including the basis for claiming the S election from the beginning. Anecdotally, we have seen deals at significant risk or be significantly delayed as a result of this issue.

As a result, we have attempted to develop some tools and procedures to assist banks and their holding companies to manage their shareholder base and changes to avoid inadvertent terminations. In addition, we have developed some procedures that will permit a bank or holding company to confirm the validity of its S election. We encourage the industry to be vigilant about this issue while at the same time affirming and promoting flow through tax treatment as a means of preserving, protecting and promoting the community bank industry.

Patrick J. Kennedy, Jr. is founder of the Subchapter S Bank Association and managing partner of Kennedy Sutherland LLP, which provides comprehensive legal services to banks, bank holding companies, and directors, officers and shareholders. He can be reached at pkennedy@kslawllp.com or 210-228-4431.

During the past 2 years, the barriers to de novo bank charters have begun to fall and experienced bank investors have begun to consider a de novo charter. The barriers to de novo charters were largely erected by the regulatory agencies,
particularly the FDIC, which imposed strict business plan adherence and other controls for seven years after the charter was granted when for decades, three years and a good plan was all that was required. In addition, significant aggregate
capital numbers were informally imposed and the industry generally held the belief, perpetuated by plenty of regulatory authority, that a group had to bring $25-35 MM in new capital on day one to charter a bank. This of course, created
multiple obstacles, one of the most significant was an unattractive return on that amount of capital because deploying that amount of capital in an efficient manner required a fair amount of market power by the organizing group. 

The first tangible sign of some relief came in December 2014 when a little noticed amendment was made to a Q&A on FDIC insurance application reduced the required business plan submission from 7 to 3 years. We believe that this
change was occasioned by efforts of the ICBA and the Association of American Bank Directors (AABD). Nevertheless, the guidance was not well known even among the agencies and their regional offices. In addition, the change did not clearly articulate what Chairman Gruenburg finally made clear in April 2016 about de novo charters.

In his speech to the FDIC Community Banking Conference on April 6, 2016, he announced that promotion of de novo charters were one of three major priorities for the FDIC, along with tiered supervision and techinical assistance. He
stated:

“Finally, we need to find ways to facilitate the process of establishing new community banks. 

The entry of new banks has helped to preserve the vitality of the community banking sector during this 30-year period of consolidation. De novo institutions fill important gaps in our local banking markets, providing credit and services to communities that may be overlooked by larger institutions. 

But we have seen the number of de novo applications decline to a trickle in recent years.

As I described, research has shown that most of this decline in chartering activity can be attributed to the challenging economic environment of the post-crisis period. We expect chartering activity to pick up as economic conditions continue to
normalize.

We have seen indications of increased interest in de novo charter applications in recent quarters. Every new institution that is established is in a position to succeed.

I want to emphasize that the FDIC welcomes applications for deposit insurance, and we clearly have a role to play in facilitating the establishment of new institutions.

In November 2014, we issued a list of answers to frequently asked questions to ensure our policies for approving these applications were made clear.

In September 2015 we hosted a training conference regarding de novo applications to help promote coordination of state and federal regulatory review processes. I would note that while the FDIC approves applications for deposit insurance by new
institutions, it is the decision of the federal or state regulator to grant that institution a banking charter.

We have designated subject matter experts and applications committees in the FDIC regional offices to serve as points of contact for deposit insurance applications. We also are in the process of planning outreach meetings with the banking
industry to ensure that they are well informed about the FDIC’s application approval processes and the tools and resources available to assist them.

And I am announcing today that the FDIC will reduce from 7 years to 3 years the period of heightened supervisory monitoring for de novo institutions. The 7-year period was established during the financial crisis in response to the disproportionate number of de novo institutions that were experiencing difficulties or failing. In the current environment, and in light of strengthened, forward-looking supervision, it is appropriate to go back to the 3-year period.

I should note that establishing even a small community bank is a challenging endeavor. Developing a sound business plan, raising the needed financial resources, and recruiting competent leadership and staff takes work and we want to ensure that every new institution that is established is in a position to succeed.

But we are very committed to working with, and providing support to, any group with an interest in starting a community bank. To that end, we are developing a handbook to guide applicants through the review process.

There is ample room for new community banks with sound funding and well-conceived business plans to serve their local markets.

It is essential that they have a clear path to approval.”

Several days later the FDIC issues amendments to its deposit insurance application rules that made clear that business plan and related restrictive controls would be for 3 years not 7. Skepticism remained rampant in the industry that the FDIC didn’t really mean what it was saying. Members of our law firm participated in several public and private meetings with the FDIC senior staff during April and May 2016. One such meeting with the FDIC Division of Supervision, included a client group interested in chartering a de novo bank. After we propounded numerous questions and scenarios, our client’s came away convinced that a de novo charter was indeed possible and feasible now and that there
were no longer arbitrarily large capital amounts required, but rather enough capital to assure that the new bank would remain well capitalized during and beyond the first three years.

Experienced Bank investors who have been involved in de novo charters are used to experiencing losses during the first year or two of the new bank as a result of organizing costs and the time it takes to build up enough deposits and earning assets to turn a profit. In the common C corp de novo, these losses are recorded on the books of the bank and will remain as net operating losses until the bank can earn enough income to offset those losses. A de novo bank that organizes as an S corporation from the beginning will result in the shareholders being able to utilize those losses immediately against other income or to shelter future income from their bank investment. As the bank begins to pay dividends to cover Sub S tax payments, some or all of those payments may not be needed for tax payments as a result of available losses from the organization.

The Sub S de novo bank and its shareholders can also benefit by the tax efficiency on an ongoing basis of having only one level of taxation and essentially not being taxed on corporate dividends from the bank. There are numerous other advantages that the Sub S de novo can achieve, including the use of an ESOP which if organized by an S corp does not pay taxes on income or dividends from the Bank and the elimination after 3 years of the TEFRA “haircut” on interest
expense.

Many de novo banks were organized with the strategy of “build them up and sell them”; however, utilizing the Sub S model an investor group can create a bank that will be a long term hold that will throw off current income to shareholders in a most tax efficient manner. In addition, if the group ever does desire to sell, the benefits of Sub S heighten the ultimate gain as opposed to the C corp Bank similarly situated. There are two reasons for this. First, a Sub S Bank shareholder’s tax basis continually increases as earnings accumulate within the bank while the C corp shareholder’s basis remains the amount that was originally paid for the stock. As such capital gains paid on the sale of Sub S stock will be substantially less. Over a 10-year period, the amounts will be very significant. Second, an S corp bank can be structured in a tax advantaged way to permit the buyer to deduct for tax purposes all the premium paid to the seller. This structure is not available in a C corp M&A structure. It is likely for these reasons that an S corp bank generally is valued by valuation experts at a 15-18% premium to a similarly situated C corp bank.

Hopefully the use of Sub S in a de novo bank context will provide a means to entice investors to take advantage of the recent loosening by the regulatory authorities and organize a community bank using the Sub S bank model.

Patrick J. Kennedy, Jr. is founder of the Subchapter S Bank Association and managing partner of Kennedy SutherlandLLP, which provides comprehensive legal services to banks, bank holding companies, and directors, officers and shareholders. He can be reached at pkennedy@kslawllp.com or 210-228-4431.

After meetings and discussions with the Joint Committee on Taxation, the Ways and Means Committee Tax Staff and our bill sponsor Congressman Kenny Marchant in late May and early June, we have determined that some amendments needed to be made, largely driven by a desire to limit the impact of the potential theoretical cost of the bill (HR 2789). Even though we have provided credible statistical evidence that the bill should not have any impact on the Treasury and that likely using a dynamic model, would be a net positive. Several of the Congressional participants have pushed to eliminate the preferred stock feature of the bill; however, we have steadfastly argued the importance of that provision and described the opportunity that C corp banks have utilizing institutional money for a preferred stock issue, much like banks have been able to use the institutional sub debt market for capital growth.

To be responsive to the Congressional participants and after consultation with key Sub S Bank Task Force Members, we have redrafted HR 2789 to limit the number of common and preferred shareholders to no more than 500 sub S shareholders as defined under the IRC (including members of a family). We resisted this initially because preferred shareholders are not considered “shareholders” under the bill, but they are for numerical purposes in the proposed redraft.

In addition, the bill will likely be redrafted to include a limitation on the amount of interest expense a company can take from payments on preferred stock in order to match the 20% dividend tax that a preferred sub s shareholder will pay on dividends (20%).

Election year issues will continue to dominate as Congress is back in Session during the month of September and we will continue to push all parties to move the bill forward. We continue to receive thoughtful and positive encouragement about ultimate passage of the legislation but there is increasing pessimism among Congressional staff about passage this year. Nevertheless, we continue to receive significant encouragement from staff and involved Members of Congress about ultimate passage of the bill. One key Member believes with enough Ways and Means Committee support; passage can occur early in 2017. Given the magic we have seen from some talented Members of Congress on unique banking issues, we have not given up on getting a bill passed this year. The good news is that Congress generally believes that the community banking industry needs some help in the face of Dodd Frank and its regulatory progeny and key leadership seem to think that this would be an impactful and credible way to do that.

Importantly, the banking industry and its owners and leaders need to get their Congressmen to join in and cosponsor this bill and to encourage others to do likewise. It can be done and you can make a difference. Please flex your political muscle and see how much you have – you may be surprised!

LLC Bill

The “companion” bill HR 3287 which would permit banks to organize as limited liability companies was and continues to be favored by the Ways and Means Committee staff as a simpler and more intellectually consistent way to give banks the opportunity to organize as flow through entities. The Congressional participants have seemed to suggest that we could have one or the other but in some quarters, the LLC bill would be more favored. While there are most certainly arguments in favor, we cannot ignore the fact that there are over 2,100 Sub S banks in the US and in order for them to access more and flexible capital structures and avoid shareholder limits, conversion to an LLC, is a tall order. As such we have argued for both bills.

We would appreciate input from the Sub S and the bank investor community on this point and any further participation and support on these issues that make sense for you and your organization. Please contact me or one of our team for further information at:

• Patrick J. Kennedy, Jr.: pkennedy@kslawllp.com or 210-228-4431
• Dub Sutherland: dsutherland@kslawllp.com or 210-228-4444
• Amy Trevino: atrevino@kslawllp.com or 210-551-0094

Though banks and bank holding companies have been able to elect S corp tax status for 20 years, we are seeing an increasing trend towards larger community banking organizations restructuring their ownership as an S corp holding company.

The key motivation in this is the obvious tax efficiency that is achieved but there are a number of other benefits that such an effort will produce for the organization.

First and probably foremost is that the organization and its leaders will already be engaging in thoughtful analysis about how to improve their organizations, shareholder value and their position as a community bank able to with stand the next decade of regulatory and market challenges.

The process of even considering and analyzing a possible Sub S election requires thoughtful study about the strategic issues and opportunities of the organization. In addition to the obvious tax benefits, the leadership will necessarily work through a set of proforma financial statements and projections that will model the benefits but also likely cause the leadership to think about their markets, people talent and long term objectives for their shareholders and community benefits.

Recently we have observed banks who have been publicly traded with excellent liquidity shun that model in favor of a smaller more focused shareholder group that can be tasked as a flow through tax entity. The most significant tax and financial benefit is that Sub S Banks must necessarily pass earnings in the form of dividends to their shareholders and they may do so in a tax efficient manner – with only one layer of taxation as opposed to a C corp that must pay federal income tax at 35% plus potential state taxes that may increase the tax costs to the organization by another 4-6%.

Since Sub S corporations may only have 100 shareholders, not including lineal descendents who are members of those shareholder’s families, the shareholder numbers are relatively small and manageable and the decision-making, strategic focus and communications are generally more consistent and optimized to reach the organizations mission and stated objectives.

Making the S election and being able to increase an organization’s net income by approximately 65% is perhaps the most dramatic change that one could accomplish at a banking organization. While distributions typically are paid to the shareholders to cover their taxes, some organizations opt to limit distributions in favor of accumulating capital which in turn accelerates growth and the creation of significant value assuming proper management of available assets.

Shareholders who do wish to operate their Sub S bank or bank holding company can maximize their value and cash flow by adopting strategies for controlling growth and thus capital needs and simply maximize income and dividends. In so doing, an individual shareholder is then free to reinvest its Sub S cash flow and to manage their personal tax situation in a way that potentially reduces their taxable income and rates so that they may retain more of the cash dividends that the S corp bank throws off.

There are a number of avenues to manage the S Corp bank to maximize the objective of the owners. One way is to utilize tax exempt securities, which are of course not taxable but will provide income for the bank and thus a means to accumulate capital without the pressure of needing to dividend cash to shareholders to pay taxes.

Sub S banks also are not subject to the interest expense disallowance that banks are subject to beginning three years after the S election, commonly known as the “TEFRA disallowance.” For a TEFRA qualified bond, the haircut is 20% and 100% for non TEFRA qualified bonds. This creates another nice benefit for the bank and an increase in profitability for the shareholders.

Another significant benefit of the S corp bank or bank holding company is that it can create an ESOP and the earnings from the Sub S stock it holds are not taxable so as dividends are paid, cash is accumulated rapidly and at a much greater value than the C corp ESOP. This can be a powerful incentive for management and employees that if properly utilized and implemented can create significant value, well beyond what would be available under a C corp model.

In addition, the S Corp ESOP can provide a market for shareholders interested in selling and for the company to plan long term value and growth.

While Sub S Bank’s have some limitations on capital access and shareholder numbers and type, these are generally outweighed by the valuation premium that Sub S Banks generally enjoy. In addition, when a Sub S bank is ready to sell, it can generally structure a sale in a more advantageous manner that if properly planned can result in greater value to be shared by buyer and seller utilizing an Internal Revenue Code election allowing parties to treat a sale as an asset sale.

Despite the fact the marginal tax rate increase of 2012 narrowed the benefits of flow through entities, many community banking organizations are re-examining the Sub S Bank model and opting for long term growth and cash flow from a well-run organization.

Patrick J. Kennedy, Jr. is founder of the Subchapter S Bank Association and managing partner of Kennedy Sutherland LLP, which provides comprehensive legal services to banks, bank holding companies, and directors, officers and shareholders. He can be reached at pkennedy@kslawllp.com or 210-228-4431.

The Community Reinvestment Act (CRA) requires the federal agencies that implement the Act — the Federal Deposit Insurance Corporation, the Federal Reserve Board, and the Office of the Comptroller of the Currency (agencies) — to assess the record of financial institutions in meeting the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, consistent with safe and sound operations. On July 15th, the agencies issued Interagency Questions and Answers1 regarding the Community Reinvestment Act (CRA) based on 126 comment letters and more than 900 form letter submissions based on the proposals the agencies issued September 10, 2014. The 220 pages of revisions clarify nine Q&As, revise four Q&As and adopt two new Q&As to offer guidance to help regulated financial institutions meet the credit needs of their entire community.

One major area of focus was “innovativeness” in CRA assessments. The Q&A describes how innovativeness is considered in the CRA rating process. Innovative practices may “be responsive to community needs but are not required if existing products, services, or delivery systems effectively address the needs of all segments of the community.” The use of innovative lending practices, innovative or complex qualified investments, and innovative community development services may increase the consideration given to an institution’s performance, resulting in a higher CRA rating. Smaller institutions or those institutions that have historically offered only traditional products, services, or delivery systems may be viewed as “innovative” by adopting innovative products and services already in the market. The Q&A clarifies, however, that a lack of innovative lending practices or innovative community development services alone will not result in a “needs to improve” CRA rating.

Also on the radar of the agencies: community development related issues. In patricular, the new Q&As address “Inconsistencies in how community development services have been evaluated quantitatively” and concerns that “Qualitative factors, such as whether community development services are effective or responsive to community needs, receive inadequate consideation.” The Q&A further states that the agencies will evaluate community development activities both qualitatively and quantitatively, but without a specific forumula.

As part of the revised Q&As, the agencies added CDFIs that finance small businesses or small farms to the list of entities for which loans or investments are presumed to promote economic development.

On page 16 of the notice the agencies address the ability of banks to claim CRA credit for their loans to, and investments in, Historic Tax Credit (HTC) projects. Historically there has been significant confusion as to whether investments in HTC projects would also be eligible for CRA credit. Because of this confusion, members of the HTC industry requested that the agencies create a presumption that activities related to HTC projects qualify for CRA credit. The agencies rejected granting a presumption, but provided that “in instances in which loans to, or investments in, projects that receive HTCs do meet the regulatory definition of community development, including the geographic restrictions, the agencies concur that CRA consideration should be provided.” The notice provides specific examples of HTC projects eligible for CRA credit, including those that:

1. House small businesses that support permanent job creation, retention, or improvement for low- or moderateincome individuals, in low- or moderate-income areas, or in areas targeted for redevelopment by Federal, state, local or tribal governments;
2. Provide affordable housing or community services for low- or moderate-income individuals; and
3. Revitalize or stabilize a low- or moderate-income geography, designated disaster area, or a designated distressed or underserved nonmetropolitan middle-income geography.

Although not creating a clear presumption that activites related to HTC projects qualify for CRA credit, the notice provides more certainty to financial institutions that CRA credit is available for HTC projects that otherwise meet the CRA requirements. This certainty may provide new and additional opportunities for banks and financial institutions to lend to and invest in HTC financed projects.

The agencies’ Q&As were first published in 1996 to provide guidance on the interpretation and application of the CRA regulations to agency personnel, financial institutions and the public. The last full Q&A was published in 2010, but some revisions were made in 2013. This new guidance, proposed in 2014 and adopted recently, is effective immediately.

Patrick J. Kennedy, Jr. is founder of the Subchapter S Bank Association and managing partner of Kennedy Sutherland LLP, which provides comprehensive legal services to banks, bank holding companies, and directors, officers and shareholders. He can be reached at pkennedy@kslawllp.com or 210-228-4431.

• The 2016 version of the “S Corporation Modernization Act” (HR 5754) has been introduced in the House and the Senate. Led by Senators Thune (R-SD) and Cardin (D-MD) and Representatives Reichert (R-WA) and Kind (DWI), the bill includes six provisions designed to improve the rules that govern S corps. Important to note that this is the first time in a while that this legislation has been championed in both bodies. Two changes that seem to be different than past versions of the bill include: 1.) Dropping the two provisions- Big and Charitable- that were made a permanent part of the Tax Code last December and 2.) Including the new internal basis adjustment provision to ensure that S corp assets receive similar treatment as partnerships. While the legislative outlook is uncertain, the Association will continue to monitor.
• HR 5808, led by Representative Duff (R-WI) and introduced in late July, the Comprehensive Regulatory Review Act of 2016, which would increase the frequency of the agency regulatory review under the EGRPRA from one every ten years to once every five years and ensure it includes rules issued by the CFPB.
• On September 11, 2016 Financial Services Committee, Chairman Jeb Hensarling (R-TX), formally introduced the Financial CHOICE Act (HR 5983), the Republican alternative to the failed Dodd-Frank Act. The Financial Services Committee met on September 13, 2016 to debate the Financial CHOICE Act, consider possible amendments, and vote on the legislation.
• An amendment to the Retirement Enhancement and Savings Act has passed the Senate Finance Committe which would provide S-corps additional capital-raising opportunities. The amendment, which is sponsored by Sens. John Thune (R-S.D.) and Ben Cardin (D-Md.), would also allow C-corp banks with IRA shareholders to elect to become S-corps, making it easier to convert to S-corp status.

Born and raised in San Antonio, Texas, Will Hurd attended John Marshall High School and Texas A&M University, where he majored in Computer Science and served as Student Body President in 1999-2000.

After college, Will served as an undercover officer in the CIA in the Middle East and South Asia for nearly a decade, collecting intelligence that influenced the National Security agenda. Upon leaving the CIA, he became a Senior Advisor with a cybersecurity firm, covering a wide range of complex challenges faced by manufacturers, financial institutions, retailers, and critical infrastructure owners. He was also a partner with a strategic advisory firm helping businesses expand into international markets.

In 2015, Will was elected to the 114th Congress and currently serves on the Committee of Oversight and Government Reform and chairs the Information Technology Subcommittee. He also sits on the Committee on Homeland Security and is the Vice Chair of the Border and Maritime Security Subcommittee.

SCHEDULE AT A GLANCE
This year we are offering courses during our break out sessions that fit each of our registrants needs. Below, you will see Course Codes: (101-Beginner, 201-Intermediate & 301-Advanced). We encourage you to pick the session that best fits yours and your bank’s needs/knowledge. 

Thursday, October 27, 2016
7:00 am to 8:00 am Registration and Breakfast

8:00 am to 8:10 am Welcome / Opening Remarks

8:10 am to 9:00am Legislative Update

• Cindy Blankenship – Bank of the West
• John Hand – ICBA
• Patrick J. Kennedy, Jr. – Kennedy Sutherland LLP
• Dub Sutherland – Kennedy Sutherland LLP

9:00 am to 10:40 am A Hitchhiker’s Guide to the Economy and Interest Rates

• Marc L. Flaster – Sandler O’Neill + Partners

10:40 am to 10:50 am Break

10:50 am to 11:40 am Executive Compensation Structures (101)

• Rebecca Pressgrove – Equias Alliance, LLC
• Patrick J. Kennedy, Jr. – Kennedy Sutherland LLP
• Dub Sutherland – Kennedy Sutherland LLP
• Jeff Weaver – TransPecos Bank

11:40 am to 12:30 pm Break Outs:

1. Holding Company Finance Tools (201)

• Chet A. Fenimore – Fenimore, Kay, Harrison & Ford, LLPExecutive Comp (201)

2. Executive Compensation Case Study 

• Dub Sutherland – Kennedy Sutherland LLP
• Paul Sirek – Eide Bailly LLP

3. How to Win Over Millennials: Are All Your Bases Covered?

• Keith Brannan – Kasasa

12:30 pm to 1:30 pm Lunch & Keynote Speaker

• Congressman Will Hurd – U.S. House of Representatives

1:30 pm to 2:30 pm Break Outs:
1. ESOPs (101)

• Patrick J. Kennedy, Jr – Kennedy Sutherland LLP
• Alex Mounts – Krieg | DeVault

2. M&A Update (101)

• Thomas Mecredy – Vining Sparks

3. Conversations with a Sub S Specialist

• Susan Kerrick – IRS

2:30 pm to 3:30 pm Break Outs:
1. Vendor Management

• Neil Falken – CliftonLarsonAllen LLP
• Brent Farley – Kennedy Sutherland LLP
• Thomas L Frale, Jr. – RLR Management Consulting, Inc.
• Joshua Juergensen– CliftonLarsonAllen LLP

2. Family Banking Succession Planning

• Sara Brouillard – Broadway Bank

3. Riches in Niches

• Dub Sutherland – Kennedy Sutherland LLP

3:30 pm to 3:40 pm Break

3:40pm to 4:30pm Accounting and Tax Update

• Kathy Herbig – Crowe Horwath LLP
• J.P. Shelly – Crowe Horwath LLP
• David Silagi – Crowe Horwath LLP

4:30pm to 6:00pm Reception

Friday, October 28, 2016

7:30 am to 8:00 am  Continental Breakfast

8:00 am to 9:45 am Investment Portfolio Management

• Terry Robertson – Raymond James
• Greg Roll – Vining Sparks
• Steve Twersky – FTN

9:50 am to 10:50 am Board Matters, Corporate Governance and Shareholder Succession 

• David Baris – American Association of Bank Directors
• Patrick J. Kennedy, Jr. – Kennedy Sutherland LLP

11:00 am to 12:00 pm Break Outs:
1. ESOP Compliance and Leveraged ESOPs (201)

• Michael W. Atwood – First State Bank Monticello, IL
• Patrick J. Kennedy, Jr. – Kennedy Sutherland LLP
• Alex Mounts – Krieg | DeVault

2. Estate Planning (101)

• Carl A. Werner – Carl A. Werner, PC

3. Shareholder Management (101)

• Chelsea Bradshaw – Citizens Bank of Edmond
• Dub Sutherland – Kennedy Sutherland LLP

12:00 pm to 1:00 pm Lunch: Credit, Strategy & Customer Engagement

• Chris Nichols – CenterState Bank

1:00 pm to 1:50 pm Break Outs:
1. Fintech

• Jill Castilla – Citizens Bank of Edmond
• Dub Sutherland – Kennedy Sutherland LLP

2. M&A Tax & Accounting (201)

• Gordon Dobner – BKD
• Keith Foster – BKD

3. Benefits (and costs) of a Bank Holding Company (101)

• John Madden – FNBC Bank & Trust
• Patrick J. Kennedy, Jr. – Kennedy Sutherland LLP

2:00 pm to 2:50 pm Break Outs:
1. Implementing a Business Process Excellence Program (101)

• John A. Wood – Broadway Bank

2. Liquidating a BHC after Qsub sale (301)

• Paul Sirek – Eide Bailly LLP

3. Preventing an Inadvertent Termination (201) 

• Brent M. Farley – Kennedy Sutherland LLP
• Community Banker invited

2:50 pm to 3:50 pm Fintech Demos and Exhibits