Florida Banking September 2023

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THE MAGAZINE OF THE FLORIDA BANKERS ASSOCIATION WWW.FLORIDABANKERS.COM SEPTEMBER 2020 Sanibel Captiva Community Bank Resilience in the Face of Challenges THE MAGAZINE OF THE FLORIDA BANKERS ASSOCIATION WWW.FLORIDABANKERS.COM SEPTEMBER 2023

Editorial & Executive Offices 1001 Thomasville Road, Suite 201 Tallahassee, FL 32303 850-224-2265 www.floridabankers.com Advertising & Production Offices 250 Prairie Center Dr., Ste. 300 Eden Prairie, MN 55344 952-835-2275 www.nfrcom.com For advertising information, contact Erica Nelson Advertising Sales Executive 763-497-1778 Erica@NFRcom.com For reprints or single issues, contact 800-336-1120 Statements of fact and opinion are made on the responsibility of the authors alone and do not imply an opinion or endorsement on the part of the officers or members of FBA. Florida Banking is published 11 times annually with a combined issue in December/January. Subscription price is $50 per year for nonmembers. Postmaster, send address changes to Florida Bankers Association, P.O. Box 1360, Tallahassee, FL 32302. Copyright 2022 Alex Sanchez President and Chief Executive Officer

THE MAGAZINE OF THE FLORIDA BANKERS ASSOCIATION

VOLUME 38

NUMBER 8

SEPTEMBER 2023

ON THE COVER 8 �� Sanibel Captiva

Community Bank: Resilience in the Face of Challenges CONTENTS

4 �� Chair’s Message 6 �� Straight Talk from the President’s Desk 12 �� Government Relations: Like a Bad Sequel - The Credit Unions Are Coming For Your Public Deposits Again! 14 �� Florida BankPac Update 16 -Exposing the Ramifications of ESG on American Investors 17 �� Bancserv Endorsed Partner: How HSAs Help Financial Institutions Gain and Retain Commercial Customers 20 �� Trust Banking: Wealth Planning For Couples Without Children 22 �� Florida Bankers Educational 23 �� Personal Transactions 25 �� Kudos 30 �� FBA Staff Spotlight 31 �� Upcoming Events 31 �� Advertising Directory 31 �� Did You Know? Foundation: Fred Leopold is 2023-2025 FBEF Board Chair

Florida Bankers Association asanchez@floridabankers.com Pamela Ricco Executive Vice President and Chief Operating Officer Florida Bankers Association pricco@floridabankers.com Brooke Harrison Publications Director Florida Bankers Association bharrison@floridabankers.com

Jose Cueto Chair

Derek Jones Chair-Elect

Bill Penney Immediate Past Chair

Fab Brumley Second Immediate Past Chair

On the Cover: The Sanibel Captiva Community Bank leadership, from left: Brian Terrell, Kyle DeCicco, and John Wright. Photos by Daniese Betito, Images for Business, Orlando, Fla.

Florida Bankers Association: The voice of Florida banking since 1888.

CHAIR’S MESSAGE

2023 IOTA AMENDMENT: WHERE WE STAND

BY JOSE CUETO, FBA CHAIR

A s you know, Interest Only Trust Accounts (IOTAs) have become a hot-button issue for the banking industry. The 2023 IOTA Amendment to the Rules Regulating the Florida Bar now requires lawyers to only maintain their trust accounts in institutions that pay a particular rate. The order requires that “[w]hen the Wall Street Journal Prime Rate (“indexed rate”) is between 325 and 499 basis points (3.25% and 4.99%), the minimum interest rate paid net of all fees and service charges (“yield”) must be no less than 300 basis points (3.00%) below the indexed rate in effect on the first business

Motion for Rehearing. The order requires the Florida Bar to report on the implementation of the new rule and allows the FBA and any other interested parties to provide comment by November 1, 2023. In addition to litigating the matter through the Florida courts, the FBA has also been in continued contact with Florida Bar officials since June to discuss the framework for a potential compromise rate that both groups could agree to outside of the court system. At the invitation of the Bar, President & CEO Corey Neil (Bank of Tampa) presented before the Florida Bar’s Board of Governors at its July meeting in Sarasota. During that

day of each month. When the indexed rate is 500 basis points (5.00%) or above, the yield must be no less than 40% of the indexed rate in effect on the first business day of each month.” As an organization with our own foundation, we can appreciate the Florida Bar’s goal of increasing access to justice through benefitting the Bar Foundation with

meeting, the Bar’s Board of Governors approved an ad hoc committee of the Bar to discuss a compromise rate. After several weekly discussions with bankers from around the state, led by CEO Dennis Murphy (Gulfside Bank), the FBA has moved toward supporting a framework of a rule that it believes could be helpful in reaching a compromise. FBA has continued its weekly

“ON FRIDAY, AUGUST 4, THE FLORIDA SUPREME COURT GRANTED THE FBA’S MOTION FOR REHEARING.”

the interest paid on IOTAs. However, with the rising interest rate environment and the focus on bank liquidity, it has been challenging for banks to implement the new rule according to the timeline laid out by the Florida Supreme Court. Since learning of the Florida Supreme Court’s ruling in April, the FBA has been focused on finding a solution to help Florida banks. In March, the FBA filed two well-argued briefs for rehearing, requesting that the Court “suspend the effective date or otherwise provide IOTA participants, including FBA members, with a reasonable time period of no less than six months to comply with the 2023 IOTA Amendment, or to transition from the IOTA program.” On Friday, August 4, the Florida Supreme Court granted the FBA’s

meetings with member banks to discuss the issue. If you or others within your organization would like to learn more about the issue or join the ad hoc committee of bankers meeting via Zoom to strategize, please reach out to SVP of Government Affairs Kenneth Pratt at kpratt@floridabankers.com. While there is still some uncertainty about how the IOTA issue will ultimately be resolved, I want to personally commend the members of the FBA who have engaged on this issue. Our combined work on this issue is yet another testament to the importance of us all working together under the umbrella of the FBA. With the many regulatory and legislative challenges that continue to plague the industry, we must continue our efforts within the FBA to meet these challenges.

4 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

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Created by the Florida Bankers Association, BancServ Inc., provides quality products and services at a discounted rate, saving Florida banks time & money. Brian Hickey, Managing Director of Partner Relations | bhickey@floridabankers.com

STRAIGHT TALK FROM THE PRESIDENT’S DESK

BATTLING LEGISLATION THAT CREATES MORE GOVERNMENT INTERFERENCE

BY ALEJANDRO “ALEX” SANCHEZ, FBA PRESIDENT AND CHIEF EXECUTIVE OFFICER

T he politics of this era are getting wackier by the moment. The banking industry is being attacked and challenged by legislation that creates an unlevel playing field and more government interference in our free enterprise system. These proposals benefit trending financial interests that are the flavor of the month for some legislators and regulators. Many of these bills, by the way, are being filed by Republicans. I wish Ronald Reagan were here today; he would be opposed to all of this. Recently, a Republican Senator from North Dakota

decide for themselves whom to bank. The decision to serve an industry or business is based on the bank’s business and risk profile. Some banks are skilled in banking certain industries and not others. What these politicians are worried about is bankers playing political games with industries due to social issues. I think our industry has gotten that memo, and we understand. As I have mentioned to you many times, including in an op-ed that was published nationally, I advise our industry not to dance with the political right or left. Banks should stay out of social issues. If

has filed bill S.293, the Fair Access to Lending Act, which places significant restrictions on certain banks, credit unions and payment card networks if they refuse to do business with a person who complies with the law. Restrictions include prohibiting the use of electronic funds transfer systems and lending programs, termination of an institution’s depository insurance and specified civil penalties. Banks and other financial institutions are allowed to deny financial services to a person only if the denial is justified by a documented

we fall for the trap of listening to a limited number of voices, it will hurt our industry and the free enterprise system. What any bank or company will discover if they look hard enough is that they have employees, investors and directors with diverse political and social beliefs, some who are on the right and others who are on the left. My message is to stay out of it. In addition to this Senate bill, Republican House Financial Services Chairman Patrick McHenry (R-NC) and his committee have a bill on stablecoin legislation.

“THE BANKING INDUSTRY IS BEING ATTACKED AND CHALLENGED BY LEGISLATION THAT CREATES AN UNLEVEL PLAYING FIELD AND MORE GOVERNMENT INTERFERENCE IN OUR FREE ENTERPRISE SYSTEM.”

failure of that person to meet quantitative, impartial, risk-based standards established in advance by the institution. This justification may not be based upon reputation risks to the institution. The sponsor of S.293, Sen. Kevin Cramer, is a Republican and conservative who normally sides with the idea of less government interference in the free enterprise system. Our message to Sen. Cramer and to all members of Congress is this: bankers should

Chairman McHenry is proposing putting the regulation of this unstable industry in the hands of state regulators. Chairman McHenry, have you attended a state legislative session lately? Our state legislators are funding roads, schools and prisons well before increasing regulatory funding. That is why state bank examiners often move to federal agencies where they can double or triple their salaries. By placing the regulatory structure of the stablecoin industry with

6 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

If President Reagan were here today, he would oppose many of these bills being filed by today’s Republicans that cause more regulatory burdens and cost.

states, what Chairman McHenry is really saying is that he is opposed to, or wants very limited, regulation for the stablecoin industry. Most states fund other priorities before funding an industry they know little to nothing about. Like the Cramer bill, McHenry’s proposed legislation will put consumers at risk, disadvantage banks, undermine financial stability and create an unlevel playing field with other financial institutions (including FDIC banks). Stablecoins, which have grown in aggregate value from about $12B in July 2020 to $127B today, are a form of digital currency that seek to maintain a one-to one peg with a reference asset often by holding reserves as collateral. Stablecoins are unique among digital assets in that they mimic commercial bank money with potential use as a means of payment and as a deposit substitute restricting credit availability. Importantly, stablecoin issuance is, in effect, a monetary exercise comparable to the business operations of regulated banks. Even today, very few people fully understand this industry and yet Chairman McHenry wants to place this regulatory task on the backs of states that have limited resources. This is a nonstarter. To ensure effective consumer protection and financial stability, it is critical that the stablecoin industry, like the banking industry, be subject to strong regulatory oversight, starting with the federal government. A key pillar of the proposed legislation is a role for state banking regulators to approve and supervise

stablecoin issuers. While some have advocated for this role for state regulators by comparing it to the dual-banking system, the proposed state path for payment stablecoin issuers is not comparable to that of state-chartered banks. State chartered banks are also regulated by a federal banking regulator. Rather, the proposed oversight model is more like state-based money transmitter licenses, a model that is insufficient to mitigate the risks to financial stability and consumer protection posed by stablecoins. Congress should apply the same level of Federal oversight to state-licensed stablecoin issuers as is currently applied to state-chartered banks in order to limit the risk of charter arbitrage. Federal oversight applied in this equivalent manner — reflecting the principle of same activity, same risk, same regulation — would include state-licensed stablecoin issuers having a primary federal regulator that evaluates and approves or rejects license applications, establishes and enforces compliance with rules to ensure financial stability and consumer protection, and participates in ongoing supervision. Yes, we are living in different political days, but the FBA will be there to advocate and lobby for more sensible legislation. In July, the FBA and a group of Florida bankers, led by our Chairman Jose Cueto and Chair-Elect Derek Jones, walked the hallways of Congress to push for more reasonable and sensible legislation — and we will not stop!

WWW.FLORIDABANKERS.COM SEPTEMBER 2023 — 7

The Sanibel Captiva Community Bank leadership, from left: John Wright, Kyle DeCicco, and Brian Terrell.

8 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

Resilience in the Face of Challenges Sanibel Captiva Community Bank:

S anibel Captiva Community Bank celebrates its 20th anniversary this year; since its founding in 2003, the bank has weathered many storms (literally!) but grown significantly, serving customers on and off Sanibel and Captiva Islands. This year also marked the completion of a two-year leadership transition naming Kyle DeCicco as president and CEO. DeCicco has worked at the bank for eight years and was mentored by bank founder and former CEO Craig Albert. “It was important to the board to have that succession from within. It was never the plan to bring in somebody from the outside who didn’t know our company culture,” DeCicco said. “Culture is very

which it believes is vital in connecting the bank with the local community. “Our marketing is not about our products and services; rather, it’s about what we do in the community, and why we do it. We showcase the organizations we support,” DeCicco said. Sanibel Captiva Community Bank supports more than 350 not-for-profit community causes through a combination of donations and volunteerism. The bank recently donated $275,000 to Fort Myers High School to fulfill its $1 million track and field renovation. DeCicco and his team are focused on building long term, loyal relationships in the local market. The bank’s commitment to and pride in its community is evidenced

important to us; that’s the way Craig built this place. He was known as the CEO who sat in the lobby with the tellers.” Albert, who will remain in a leadership role as chair of the board, founded the bank to serve the community on Sanibel and Captiva Islands. As the story goes, Albert and the founding shareholders raised the capital in just one weekend — a testament to the true need for the bank and the support from the island community. Over the last seven years, the bank has experienced explosive growth doubling

not only by its outreach but by the local art on display in each of the bank’s branches — beautifully engraved glass by local artist Lucas Century, and paintings and prints of local scenes by Rachel Pierce. Over the last year, the bank has stepped up to help its community rebuild in the wake of Hurricane Ian, the devastating Category 4 storm which made landfall in Southwest Florida in September 2022. “Our community is resilient. Very few people have thrown in the towel or moved away. Everybody wants to rebuild,” DeCicco

“OUR MARKETING IS NOT ABOUT OUR PRODUCTS AND

SERVICES; RATHER, IT’S ABOUT WHAT WE DO IN THE COMMUNITY, AND WHY WE DO IT.”

- KYLE DECICCO

said. “Our customers want to open their restaurants and gift shops again. As a facilitator of capital, we’re here to help that process.” In the days and weeks following the storm, the bank ran multiple boat trips to Sanibel Island each day, transporting supplies, cash and people. The team rode bicycles three miles each way to reach the bank’s main office, which incurred water damage. Less than two weeks after the storm, the bank reopened its main branch on Sanibel using the parking lot to service customers, providing cash services, access to safe deposit boxes, and serving hot dogs and hamburgers. The bank’s boardroom later served as a temporary branch while the rest of the building underwent renovations. The Sanibel main office was not fully operational until June 2023. Approximately 10 percent of the bank’s employees were displaced from their homes. The bank quickly Sanibel Captiva Community Bank, Continued on page 10

its number of branches in Lee County. Today, the bank has eight locations with total assets of more than $850 million. “Our focus is on the people. When we take care of our customers, employees, and shareholders, the numbers take care of themselves,” DeCicco said. “Our No. 1 goal is to remain independent; it is not to sell, to merge, or to become something we’re not. We know who we are. I’m grateful that we have a board of directors that understands that.” CCO Brian Terrell added, “We have three former community bank presidents on our board, which makes us unique; they understand community banking.” DeCicco describes the team’s ethos as “give first, then receive.” The bank’s marketing strategy reflects that ethos. Rather than placing all marketing dollars into traditional channels, the team puts half of its marketing budget into community outreach activities

WWW.FLORIDABANKERS.COM SEPTEMBER 2023 — 9

the end of June (in just a nine-month period), the bank had seen a 26 percent increase in loans. “The growth started pre-storm, and would have continued, but it has definitely compounded because of the storm,” said CFO John Wright. “We have had very rapid loan growth, and we want to continue to service our community.” Wright encourages banks who may be looking for loans to reach out, as the team at Sanibel Captiva Community Bank is “willing and more than able to help you grow your loan portfolio with some loan participations.” In the short-term future, the bank’s priority is to continue helping those affected by the storm rebuild. “There’s plenty of work to be done right here. We will continue to help get our community back on its feet,” DeCicco said. The bank will have a big event in the fall to celebrate its 20th anniversary,“done in Sanibel Captiva Community Bank style,” which is to say that it will be a casual, family-friendly occasion. The team looks forward to celebrating with its customers and employees. “We’ve all gone through ups and downs in our careers. The big picture is that we will continue to face challenges, but we’ll do it together as a local community bank for another 20 years, and beyond,” DeCicco said. “That’s my commitment to Craig, to the board, and to our shareholders and employees. It’s a good feeling.”

found housing for some of those employees and made a financial commitment to help cover rental costs. It was the bank’s first priority to make sure that everyone was okay. The team credits its alert notification software, AlertMedia, for quickly assessing the safety of employees during and after the storm. Sanibel Captiva Community Bank employees were among the 114 recipients who received direct aid from the FBA and ICBA’s Hurricane Fund. As a result of this program, the FBA provided more than $222,000 directly to those whose homes or vehicles were damaged or destroyed in the storm. “I want to thank the FBA for what they did to help our employees,” DeCicco said.“The contribution from the FBA and ICBA went directly into our employees’ pockets to help them rebuild.” In early 2023, the bank raised $6.6 million in capital from its existing shareholders to support rebuilding efforts. “We made the decision to raise the capital, so we’d have the backing to do what we knew needed to be done. Without that capital raise, we couldn’t process these additional loans, and we couldn’t help our community the way we are today,” DeCicco said. Since the storm, the bank has processed more than $75 million in loans directly related to Hurricane Ian, and continues to lend to HOAs, contractors, business owners and homeowners to help them rebuild. As of Sanibel Captiva Community Bank, Continued from page 9

Sanibel Captiva Community Bank celebrates its 20th anniversary this year.

10 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

KYLE DECICCO Kyle DeCicco joined Sanibel Captiva Community Bank in 2016 as vice president and commercial loan officer. In 2021, DeCicco was named bank president and a member of the Board of Directors. He became president and chief executive officer in 2023, making him only the second CEO since the institution’s founding in 2003. Under his leadership, the bank has experienced exponential growth, pushing total assets from $260 million to $850 million in seven years. DeCicco has completed both the FBA’s School of Banking and the ABA Stonier Graduate School of Banking. He graduated from Florida Atlantic University with a bachelor’s degree in business administration after double-majoring in finance and management. DeCicco serves on the board of directors for The Foundation for Lee County Public Schools and is the organization’s treasurer and a member of the Grant Selection Committee. He is also a Captain-level Keel Club member of the United Way of Lee, Hendry, Glades, and Okeechobee Counties.

JOHN WRIGHT John Wright is executive vice president, chief financial officer, and chief operating officer at Sanibel Captiva Community Bank. He joined the bank in 2020 after relocating to Southwest Florida from Baltimore. Wright has more than three decades of experience in the financial sector; before joining SanCap Bank, he was part of a two-person executive management team that orchestrated a turnaround at two different troubled banks implementing proper accounting and operational best practices. He is the current chair of the Florida Southwestern State College Foundation, and he also serves on the Lee County Horizon Council as a member at large for the public-private advisory group to the Lee County Board of Commissioners on economic development issues. Wright graduated from the University of Maryland with a Bachelor of Science degree in accounting and became a certified public accountant in 1990.

BRIAN TERRELL Brian Terrell is executive vice president and chief credit officer at Sanibel Captiva Community Bank. He has been with the bank since 2010. Terrell has more than 20 years of credit experience in the banking industry and has worked for national, regional and other community banks. Before transitioning into banking, he worked in the hospitality industry with Lees Inns of America, a family-owned hotel company based in Indiana. Terrell graduated from Hanover College with a Bachelor of Arts degree in business administration and a minor in economics. He earned his Master of Business Administration degree with a double major in finance and management from Miami University.

WWW.FLORIDABANKERS.COM SEPTEMBER 2023 — 11

GOVERNMENT RELATIONS

LIKE A BAD SEQUEL - THE CREDIT UNIONS ARE COMING FOR YOUR PUBLIC DEPOSITS AGAIN! BY ANTHONY DIMARCO, FBA EXECUTIVE VICE PRESIDENT AND DIRECTOR OF GOVERNMENT AFFAIRS

J ust like sequels to bad movies, the credit unions are coming back for your public deposits in the 2024 Session! Their state PAC has outraised ours and they are beginning to hire more outside lobbyists for the upcoming Session. Moreover, credit unions are buying community banks across the state at an alarming rate. Our fight with credit unions over public deposits has been going on since 2009 when they made their first legislative attempt to take them. We have been able to

Kenneth, Alex, Gina and I are working to stop this bad legislation. While this is great help, our best advocates are our members. What can you do? First, talk to your local legislator now. It is better to tell them about our issue now instead of right before they vote. Also, attend any legislative event we host in your area. These smaller events work well to help legislators get to know their local bankers. Finally, we ask that

beat them back; however, they are taking their advocacy to a new level for the 2024 Session. How are they going about this? The credit union PAC has raised more than $365,000, with four credit unions contributing almost $173,000. One alone, Suncoast, has contributed $89,000 to their PAC. Because they outraise us, they can also outspend us. The credit unions have donated more than $370,000 so far for the 2024 election cycle to state candidates, parties and leadership funds. They have

you quickly and forcefully answer our Calls to Action when issued. Your response will be even better received if you have taken the time to get to know the legislator back at home before Session.

“MAKE NO MISTAKE, CREDIT UNIONS ARE COMING FOR PUBLIC DEPOSITS NEXT SESSION, AND THEY ARE COMING HARD.”

You will be surprised how strong your message is with legislators. More than once I have heard legislators say,“My banker called me about this, and I need to vote with them,” or “I met my local banker when I was first running for office, and he explained this issue to me when he helped on my campaign.” It makes us feel much better when we hear these words from legislators. Make no mistake, credit unions are coming for public deposits next Session, and they are coming hard. We promise that we will do everything in our power to kill this bad piece of legislation. We hope we can count on your help as well. Thank you.

consistently outspent us and will do so again this year. The credit unions are also hiring more lobbyists to push their issue. Not only have they hired two of the best lobbying firms in Tallahassee, but VyStar has hired two in-house lobbyists to push this issue. It seems like I am hearing from another lobbyist every day, letting me know they are looking for more outside lobbyists to put on contract.

12 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

IS YOUR COMMUNITY BANK BOND PORTFOLIO PERFORMING?

Meet Jim. Jim meets with community bankers across the U.S. to discuss ICBA Securities’ investment products, services, and education through our exclusively endorsed broker, Stifel. Investing through ICBA Securities is a direct investment back into the community banking industry. When Jim is on the road, he always takes time to enjoy local restaurants

and share on social media. As an ICBA member, you’ve got Jim’s help investing. Learn more at icba.org/securities

Florida BankPac Update PAC contributions for 2023: $238,805.00 Contributions received between 1/1/2023 and 8/7/2023

Contact Cheryl Tucker (ctucker@floridabankers.com) when your institution achieves 100 percent board member BankPac contributions.

Jiten Patel Mahendra Patel Nilesh Patel Rajeshkumar C. Patel Shilen Patel Vijay M. Patel Anand Sabapathy John Thompson Citizens Bank & Trust Wesley Barnett Brian Bracey Carlie W. Cosce Marianne F. George Tiffani R. Gozdur Sherry B. Kelley Greg Littleton Robert A. Loftin Vaughn H. McAshan

Laura Williamson

Deborah Van Sickle Max Jaime Weisinger

Banks with 100 percent board member contributions:

Community Bank Fred Leopold Justin Woodard Community Bank of the South Harold T. Bistline Stephen D. Crisafulli

First Colony Bank

Central Bank

Ralph Betancourt Robert Godwin Edward E. Haddock, Jr. Bruce W. May

Community Bank of the South

Edison National Bank

First Bank, Clewiston

Dominga Sanchez Thomas J. Sheehan

Kevin P. Markey Kevin B. Steele William T. Taylor Carlos K. Woodward

Winter Park National Bank

First National Bank Coastal Community Nicole Jones First National Bank of Mount Dora Bob White First National Bank of Pasco Steven D. Hickman First National Bank of South Miami Veronica Flores First National Bankers Bank Chris Alexander Linda Cook Lourdes Mendes First State Bank of the Florida Keys Karen M. Sharp Flagship Bank

BankPac contributions:

Crescent Mortgage Cammie Aucoin Crews Banking Corporation JW Crews, IV Bradley L. Wilson D.A. Davidson & Co. Bob Pabst Edison National Bank John P. Ammons Elizabeth Aurensan Greg Blurton Karen M. Brazelton Lenor Cross

5iron

Jeremy Hopwood

ABA

John Jordan Banc Card of America Andrew Lane Bank of America Fabiola Brumley Bank of Belle Glade Stephen Prielozny BankFlorida Kenneth R. Lehman

Douglas W. McPherson William G. Middleton Bonnie Parker

Mark E. Schreiber Joseph T. Stangry

Lori J. Wilson Patricia Wilson Citizens First Bank Paul B. Abell Jay Bartholomew Lindsey Blaise

Christina DePari David M. DuVall Lisa Hobson June Howard David Lowden Susan Nasworthy Kim Nyberg Matthew Overmyer Patrick Philbin Geoffrey Roepstorff Robbie Roepstorff Susan Schulte Richard Shera First Bank, Clewiston

James “Bud” Stalnaker, Jr. Capital City Bank Group, Inc. Thomas A. Barron William F. Butler Stanley W. Connally, Jr. Bonnie J. Davenport Connie Davis Kenneth D. Pratt John G. Sample, Jr. William G. Smith, Jr. John J. Wahlen Capital City Trust Company William L. Moor, Jr. Central Bank David L. Edgar

Charles D. Borrowman W. Thomas Brooks Tina Campbell Jennifer Couture Kristen M. Crawford Michelle D. Crawford Ginger L. Devine Marci J. Duke Mark D. James Stephen T. Kurtz Christopher T. Langley Adam Lombardo Kevin W. McDonald Mark Morse James H. Parr Steven M. Roy Danna A. Schmid Tricia M. Snodgrass

Kenneth Bailey David Brandon Ronald Hockman Mark Klein Ken Marks Robert McGivney

James Nelson Joseph Oliveri Nick Patel Brent Sembler Robert Shaw Kelly Spica Christopher Sprowls Paul Wikle Florida Bankers Association Anthony DiMarco Lesley Jordan Barbi Miller

Bryan D. Beer Mary E. Carroll Andrew Couse Miller Couse Earle E. Edwards, III Andrew J. Higginbotham Karl E. Larsen Thomas C. Perry M. Carey Soud

Scott Kohler Arvind Patel Dinubhai D. Patel Jayesh D. Patel Jayesh K. Patel

Scott J. Sullivan Bradley Weber Martina Weiss

Dianne Pagel Kenneth Pratt

14 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

Chuck Colwill Debbie Cooper Jennifer Denney A.G. Divers Brett Divers Tim Donaldson Luis Eguia Michael Eubanks Pat Fain Preston Farrior Jim Ferman John Fillingim Angela Gardner Scott Gault Ann Giles Kevin Gilligan Merlisia Gittens Donovan Glaister Erin Hesbeens Oscar Horton Wesley Joyner Kyle Keith Bill Kent Malorie Kent Aenoi Kounlavong Mike Krieg Jeni La Paglia Alison LaPointe Tom Lee Toby Lincoln Jonathan Locklear Tim Mann Joe Marshburn Alyssa Martineau Cristina Martinez Si McAninch Terry McFatter Cathy Harris Gary Harrod Kristen Herrick-Feazell Chris McGee Susan Miller Judy Mitchell Blaine Morrison Sebastian Mrowczynski Trey Mueller Charlie Murphy Corey Neil David Newberry

Alex Sanchez Funding Circle Chris Connor Grove Bank & Trust Jose Cueto Gulf Coast Business Bank Jennifer Compton P. Compton Cramer, Jr. N. Rogan Donelly Teri Hansen Frank Lacivita Thomas Martin, Jr. Dennis Murphy Sam Norton Michael Pender Charles Rush Drayton Saunders Jeffrey Saunders Heartland National Bank Andrew S. Bible James C. Clinard Jerry T. Whidden International Finance Bank Sonia Canessa-Gonzalez Intracoastal Bank Cynthia Fite Lively Gulfside Bank Tim Clarke

Ocean Bank

Joel Smith Greg Stahl John Stump Simon Sumner Daryl Tatum Frank Territo, II James Tollerton Darrell Turner John Unger Billie Valloreo Debbie Viveiros Donna Walsh Chad Wammock Pam Warnock Ashley Watters Bill West Craig West Paul Whiting Blake Williams

PAAST, P.L.

Alexander Sueiro Prime Meridian Bank Sammie Dixon Profit Resources, Inc. Dave Koto Qualtik Jen Adcock Retriever Payment Systems Frank Krieger Saltmarsh, Cleaveland & Gund Paul Allen Kristen Stogniew SBS Cybersecurity Freddie Martin Seacoast Bank

David Zillig Ryan Zsiga TrustCo Bank

Miriam Lopez Mary Usategui SebastianStrong Oscar Ortiz ServisFirst Bank

Kevin M. Curley Michael Hall Robert M. Leonard Robert J. McCormick Michael M. Ozimek, III Scot R. Salvador Eric W. Schreck United Data Technologies Luis Aguiar Kayler Hevia United Southern Bank Connie Nelson Gregory L. Nelson Waterfall Bank G.A. “Andy” Williams Wauchula State Bank J.W. Crews, Jr. Donna McKown Gary “Rob” Roberts Wells Fargo Bank, N.A. Derek Jones Winter Park National Bank Dell W. Avery James L. Bolen Sidney Cash Michael C. Crisante, Jr. David R. Dotherow

Thomas Bo Carter

SHAZAM!

Alex Jernigan SouthState Bank Mark Tucker Strategic Resource Management Brent Lapp Sunstate Bank Yvonne Debesa The Bank of Tampa Drew Aldridge Tammy Amburgey

Adam Berry Gerry Hollis Locality Bank

Keith Costello Kenneth R. Lehman Mainstreet Community Bank of Florida Roger B. Baumgartner T.L. Bushey W. Ben Flowers, Jr.

Ed Armstrong Sam Astin, III Antonio Azorin Suzy Bateman Doug Bishop Bob Blanchard Bryan Boudreaux Matthew Boyd Dave Brown Rachael Brown John Bui Mitch Burley Melissa Burman Maureen Busch Matthew Buzza Lisa Carlton Greg Celestan Ken Cherven Aric Chevtaikin Cathy Collins

David Hyzer Anne Kelley Stephanie Koshiol Wendy Libby Randall J. Marshall

Thomas Oliver Dotti Overton Edna Owens

Hal M. Rogers Paul Rountree Marine Bank & Trust Company

Sarah Peet Zane Petty Kris Phillips Lee Pierson Stacey Pittman Mark Poppell Susanne Powers Carly Ross Jim Scott Reade Sevigny Anne Shaughnessy

James W. Ferrell Teague Gilliland Jeffrey C. Jenkins Stan T. Pietkiewicz

Kenneth Lehman William J. Penney Mauldin & Jenkins Alison Wester New Edge Associates Yesenia Moreno NFP Executive Benefits Joe Schaefer

WWW.FLORIDABANKERS.COM SEPTEMBER 2023 — 15

EXPOSING THE RAMIFICATIONS OF ESG ON AMERICAN INVESTORS

BY CONGRESSMAN BLAINE LUETKEMEYER

E nvironmental, social and governance (ESG) policies remain very present in corporate America, with companies giving in to pressure from progressive investors and policymakers to get on board with things like climate initiatives and other social policies that have nothing to do with the company or its practices. Corporate boardrooms have become political platforms for extreme ideology. As I’ve said several times in the past, advancing political agendas at the expense of American investors paying into their retirement or savings is unacceptable. Considering all the issues there are with ESG, combating these radical proposals and policies has been high on our priority list at the House Financial Services Committee this summer. Recently, we had a full committee hearing on the ramifications of ESG on American investors and financial regulation. One of our hearing witnesses, Lawrence Cunningham, has built his reputation on being a trusted industry voice on corporate governance, culture and law. In response to my questions, Mr. Cunningham replied, “it’s commonly said that following ESG practices is good for the long-term economic interests of a company or of a fund, but the empirical evidence doesn’t support that assertion…” I couldn’t agree more, and it seems that some of ESG’s earliest disciples are being forced to acknowledge that truth. BlackRock CEO Larry Fink commented in June that he was “ashamed” to be part of the ESG political debate and is no longer using the term. Vanguard has pulled out of its net zero climate effort for more “independence” in helping its customers find returns. While it’s clear that I have serious issues with the many shortcomings of ESG investing, there is another issue at hand. The hypocrisy of many in corporate

America who preach social and environmental responsibility while continuing to do business with the Chinese Communist Party is staggering. China has the largest carbon footprint on earth and openly utilizes forced labor to manufacture the products these “socially conscious” companies sell around the world. This is another problem that I’m working on in my capacity as the Chairman of the Subcommittee on National Security, Illicit Finance, and International Financial Institutions and a member of the Select Committee on the CCP. I unfortunately have no doubt that ESG will continue to be an issue the financial services industry must grapple with for the foreseeable future, and we are working to combat these misguided policies in various ways here in Congress. Together with my colleague Congressman Bill Huizenga (MI-02), we introduced the House version of the Investor Democracy is Expected (INDEX) Act. This bill will empower American investors who are currently at the mercy of investment advisers. The INDEX Act requires investment advisors of passively-managed funds to vote proxies in accordance with the instructions of fund investors — not at the discretion of the adviser. Sen. Dan Sullivan (R-AK) introduced the Senate version, and we are working in a bicameral fashion to advance this bill soon. While combating ESG is going to certainly take more than one piece of legislation, this bill is a good start and allows investors who want a voice to have one. While we certainly have our work cut out for us with the prevalence of ESG policies, my House Financial Services Committee colleagues and I will continue working to find ways to put an end to the unethical ESG practices and pressures that are turning corporate America into political campaigns.

16 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

BANCSERV ENDORSED PARTNER: LIVELY, INC.

HOW HSA s HELP FINANCIAL INSTITUTIONS GAIN AND RETAIN COMMERCIAL CUSTOMERS F L O R I D A B A N K E R S A S S O C I A T I O N

BY ADAM BERRY, NATIONAL DIRECTOR, BANKING PARTNERSHIPS, LIVELY, INC.

E very so often, external forces require an industry to change. Presently, the headwinds of inflation, higher interest rates, macroeconomic volatility, a precipitous drop off in mortgage originations and shifting customer practices are bearing down on financial institutions. According to a recent report from McKinsey, bank profits reached a 14-year high in 2022, but only 35% of banks globally saw returns above the cost of capital. To weather the current environment, financial institutions need to reevaluate the way they’re doing business. This includes reimagining their customer journeys by offering new products that bring cross-selling opportunities, partnering with their commercial customers to help them better operate their businesses, providing a modern, digitized customer experience and comprehensive support. Partnering with a commercially competitive Health Savings Account (HSA) provider, especially one that meets and exceeds customers’ expectations for ease of use, can help financial institutions achieve these goals. How HSAs help financial institutions meet the current moment Customers, both commercial and retail, want to see something new from their current financial relationships. They want services to be simple, intuitive, digitized, and all in one place. They want personal, human, and responsive customer service, not a call center or chat bot, and they want a true partner in operations. They want built-in education to help account holders understand what an HSA is, how it works, and what they need to do to get the most out of the product. They want many of the things as business owners that they expect as a retail customer. In fact, the lines between retail and commercial customers are often blurred since 90% of small business owners keep their personal account at the same bank as their business account.

One way financial institutions can better retain, engage, and increase commercial business and win a larger share of their wallet is by offering a tech forward HSA. HSAs provide businesses of all sizes with many advantages. These include: • HSAs help businesses cut costs. Supply chain issues and inflationary pressure have many organizations looking to reduce their expenditures, and the cost of employing workers is right at the top of that list. A majority of employers expect that these costs will continue rising and the trend of high prices will persist. HSAs are paired with High Deductible Health Plans (HDHPs), which typically have the lowest annual premiums of the traditional health insurance options. The high deductible can give employees pause, but when paired with an HSA, the account provides an incentive for employees to choose the more affordable health insurance plan. That’s because HSAs give workers a way to save for the higher deductible tax-free. By giving employers a solution to increase adoption of their HDHP, financial institutions can help them lower the cost of employment, which helps them attract and retain top talent, while reducing operational costs. • Providing an enterprise-level HSA solution with automated functions like enrollment or payroll contributions can help finance and HR teams save time, reduce errors, and ensure a better employee experience. Many small and medium sized businesses have lean finance and HR departments. That means they need an easy way to manage their everyday operations. By offering an HSA through the same financial institution they already bank with, it reduces the vendors with which they have to interact and can help solidify customer loyalty.

Continued on page 18

WWW.FLORIDABANKERS.COM SEPTEMBER 2023 — 17

the small businesses they surveyed at the end of 2022 expected to change their financial services relationship in the next two years. • HSAs give financial institutions a new revenue stream that can increase the overall lifetime value of each customer. Banks and other financial institutions can earn revenue through net interest margin, interchange and employer administrative fees. Why your commercial customers already want an HSA Selling an HSA to your current customers won’t be a difficult task because more than half of Americans are already enrolled in an HDHP and are looking for ways to cut down on healthcare costs. These types of plans are growing in popularity because they offer the lowest monthly premiums and the greatest flexibility in terms of where employees spend their healthcare dollars. Offering an HSA alongside an HDHP is essential to both securing employees’ adoption of the health insurance plan, but also in financially supporting their physical and financial health. That’s why, according to Devenir, 70% of HSAs are sourced through an employer. In fact, over 55% of US employers offer an HDHP, so many of your customers are looking for an HSA for

Continued from page 17

• HSAs help businesses recruit and retain talent. Many small and medium-sized businesses have a difficult time competing with larger organizations for talent. In addition, employers of all sizes are working hard to retain talent, as losing employees means a loss of productivity, intellectual capital, and can cost more than half an employee’s salary to replace them. But by offering an engaging, tech forward HSA that offers features like investment options and account holder education, businesses can differentiate themselves in the labor market. Offering an HSA also provides many advantages to financial institutions, especially for commercial customers. These include: • They provide financial institutions with a pathway for cross-selling. If you offer an HSA to employees that are not current customers, and you perform well, you establish a positive relationship and have the opportunity to woo them from their current banking relationship. If you’re unsure how large of a demographic these customers represent, according to a recent study by McKinsey, people are currently 2x more likely to open a new account than they were in the past, 15% are open to a new banking relationship and 20% are considering switching their banking relationships. In addition, BAI found that half of

the first time, or they’re looking for a better one. Offering your customers a competitive HSA not only strengthens your relationship and opens the door to cross selling new products, but keeps the deposits, net interest margin, and fee revenue gained from HSAs from going to a competitor. Why commercial customers need an alternative to traditional HSAs Most HSAs offered by banks are focused on the individual account holder and aren’t equipped with an employer platform that enables administration of, and insight into, the plan. Without an employer dashboard that can run custom reports, APIs for benefits administration integration and payroll integration, census management, contribution management, education, and transparency, you won't be set up to serve and grow with your commercial customers. Because the majority of HSAs are sourced through employers, you want to make sure you are set up to serve their needs to offer the most competitive HSA and ensure it is easy for employers to administer and manage, as well as simple for employees to use. Most traditional HSAs, including those offered by many financial institutions, are

18 — FLORIDA BANKING THE VOICE OF FLORIDA BANKING

not equipped with built-in education that enables HR professionals to help their employees to get the most out of an HSA. While HSAs have existed for 20 years, many people confuse them with other tax advantaged accounts like FSAs or HRAs. They also don’t understand that HSAs are designed for long term savings, causing them to ultimately miss out on the benefits these accounts provide from both a cost savings and financial planning perspective. Working with a provider that provides educational materials for HR administrators and account holders and folds education into the product experience can make a key difference in levels of account participation, ultimately driving higher levels of HSA deposits. Partner with a forward-thinking HSA provider for success In order to take advantage of the benefits of offering an HSA to commercial customers, financial institutions need to choose the HSA provider that they partner with carefully. A successful partner needs to be able to take on HSA administration, employer and account holder onboarding, offer responsive customer service, and up-to-date technology, including a mobile app, in

order to offer customers the type of experience they expect in a modern financial product. By offering a competitive product that meets the diverse needs which are currently top-of-mind for your commercial customers (and their customers, i.e. their employees), financial institutions can attract more high quality commercial customers, boost retention, and increase their revenue. An HSA product enables you to deepen a current relationship or initiate a new one, and cross sell other products to them and their employees in the future. Adam Berry oversees Lively’s Financial Institution Partnerships channel and works with banks across the country to develop and implement HSA product solutions. Over the last 20 years, Berry has gained a significant amount of HSA experience working for national TPAs and creating HSA programs within brick and-mortar regional banks. HSAs are a personal passion of Berry’s, and he specializes in bringing entities together to discuss transparent, unique and innovative solutions that result in a better way to do business, increase revenue for Lively’s banking partners, and improve the lives of their mutual customers.

JANUARY 24, 2024

during the 2024 Legislative Session and spend a day at the Capitol discussing important banking and economic issues with Florida legislators. The day ends with Capitol Night—a dinner held at FBA headquarters.