2019 Journal of Community Bank Case Studies

Utah Valley University

THIRD PLACE:

It will continue to serve the community and provide quality economic relief and service to its customers. Rude commented on the importance of community banks in Utah saying, “We feel like the community banks offer great value to the community. Servicing the local residents, offering a variety of products and services: ag loans, construction loans, commercial loans, and personal loans. Having a deposit base in those communities and having access to local decision makers is very important as well” (Rude). With the strong growth the bank’s primary market is experiencing, People’s Intermountain Bank is well positioned to continue its current strategy. Operating at a higher level and with much more sophistication than most community banks of its size, the bank will continue to effectively serve the community even without major relief from S.2155. Part IV: Looking Forward People’s Intermountain Bank has historically been prudent and continues looking forward with optimism. In the last year specifically, People’s Intermountain Bank has seen huge growth primarily due to an acquisition and merger. The bank is constantly seeking to expand its customer base and better serve their existing customers (Williams). This study found four specific ways that reasonable adjustments to regulations could potentially benefit People’s Intermountain Bank. The exam cycle was changed from 12 to 18 months for qualifying banks with the passing of S. 2155. Bule suggests that an exam every 24

People’s Intermountain Bank has historically been prudent and continues looking forward with optimism.

months would be sufficient for strong banks. He argues that the banks’ financials are available to regulators who could monitor minor changes remotely and intervene when necessary. Changing the exam cycle to 24 months would allow additional allocation of the bank’s limited resources to innovation, implementing prior exam’s recommendations, and satisfying their customers. Management at People’s Intermountain Bank is adamant that accounting and regulations boards should reconsider the implementation of CECL. This new regulation will require banks to hold life of loan-loss reserves on the balance sheet instead of one year’s worth of allowance. “The perspective from both the accountants and regulators is that it will provide a cushion for banks in the case of an economic downturn. Unfortunately, the impact I don’t think they’re considering is that adding the additional reserves will negatively impact the consumer. If a bank has a longer-termed loan they have to hold more capital for that loan. Banks are going

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