FIT Dept. of Banking and Finance 2990 Brandywine Road, Suit 200 Atlanta, GA 30341-5564 (770) 986-1633 Phone (770) 986-1655 Fax http://www.gadbf.org David G. Sorrell, Commissioner financial institutionS today news about all dbf regulated entities August 31, 2005 Monthly Bulletin #8 In this Issue: LIMITED EMERGENCY DECLARATION o Limited Emergency Declaration Under the provisions of Code Section 7-1-111 of the Financial Institutions Code of o Credit Union Policy Statements Regarding Georgia, the Department has determined that a state of emergency exists throughout Criteria and Issues Georgia with regard to those displaced by Hurricane Katrina who are temporarily Related to Residential residing in this state. Group Common Bonds and Nonmember Deposits Accordingly, under the provisions of Code Section 7-1-111, the Department hereby in Credit Unions o Community Reinvestment declares a financial emergency regarding this situation and under the further authority Act (CRA) Joint Final of Code Section 7-1-112, with regard to the payments of financial institutions, Rules declares the following: o Opportunities and Risks Facing Community State-chartered financial institutions are encouraged to provide assistance to Lenders that Support International Trade depositors and members of other financial institutions who were located within the o Free Webinar on Email affected areas of Louisiana, Mississippi, and Alabama. Security o Guidance on Implementing State-chartered credit unions may provide services to those persons who are members of another credit union, including check cashing, access to ATM networks, or other paying or receiving services to meet short-term emergency needs where those persons were displaced by Hurricane Katrina. Check cashing and ATM a Fraud Hotline o FDIC Provides Shoppers Guide o FDIC Updated IT Exams services may be provided to affected nonmembers in order that they may access the payment system. The Department encourages the waiver of fees that exceed the cost of providing such services. Prudent and compliant procedures for verification of identity of any displaced person should be followed. This declaration shall remain in effect until such time as terminated by the Governor or the Commissioner of the Department of Banking and Finance, or on October 2, 2005, whichever occurs first. This declaration may be renewed depending upon conditions in October. This declaration is consistent with the interest of the public, financial institutions, and its depositors. Financial institutions should consult the joint issuance by regulators on this subject at: http://www.fdic.gov/news/news/press/2005/pr8505.html. Questions about these procedures may be directed to Wayne Orr at (770) 986-1637. This 2nd day of September 2005 By: David G. Sorrell Commissioner Department of Banking and Finance Credit Union Policy Statements Regarding Criteria and Issues Related to Residential Group Common Bonds and Nonmember Deposits in Credit Unions The Department of Banking and Finance has revised a Policy Statement regarding the Criteria and Issues Related to Residential Group Common Bonds to reflect recent changes that have occurred in the Laws and Rules related to Residential Group Common Bonds. This criteria continues to focus on meeting the definition of a neighborhood, community, or rural district in accordance with OCGA 7-1-630(b) and demonstrating the credit union meets the safety and soundness criteria to serve the residential group common bond that is being requested. The full policy statement is provided at http://www.gadbf.org/publications.html. Additionally, the Department has developed a documentary checklist to assure that any application received for a residential group common bond complies with the requirements of the statutory rule and policy statement requirements for a residential group common bond. This is included in the revised credit union application manual which is available at http://www.gadbf.org/publications.html. The Department also has recently developed a Policy Statement on Nonmember Deposits in Credit Unions. This Policy statement was developed in response to certain comments received by the Department regarding recently issued Rules which become effective September 5, 2005. As reflected by the Policy Statement, non-member deposit taking for state chartered credit unions is significantly limited under Georgia law. The Policy Statement also reflects that any such non-member deposits are subject to NCUA Rules which provide certain requirements regarding signage, acceptance of deposits, disclosures at the time of account opening, and subsequent disclosures on marketing or account information. It has been the observation of the Department that such non-member deposit taking by credit unions has been extremely limited in the State of Georgia. The full text of the Policy Statement is available at http://www.gadbf.org/publications.html. If there are any questions regarding these Policy Statements or the checklist, please forward these to Deputy Commissioner for Supervision Grace Lurry. Page 2 of 14 COMMUNITY REINVESTMENT ACT JOINT FINAL RULES The FDIC, Federal Reserve Board, and the Office of the Comptroller of the Currency have published joint final rules regarding the Community Reinvestment Act (CRA). The rules, which became effective September 1, 2005, provide regulatory relief for smaller community banks and preserve the importance of community development in the CRA evaluations of these banks. For further information, go to http://www.fdic.gov/news/news/financial/2005/fil7905.html. OPPORTUNITIES AND RISKS FACING COMMUNITY LENDERS THAT SUPPORT INTERNATIONAL TRADE There are tremendous opportunities for community banks in small business trade activities. One of the main complaints among small businesses is the difficulties in helping buyers find financing for their purchases. As such, the growth in worldwide trade may provide innovative community banks an opportunity to generate additional loan demand and increase fee income. Some of the services that community banks are beginning to offer include issuing international letters of credit, providing trade-financing loans, facilitating or executing foreign currency transactions and wire transfers, and providing direct operating funds through traditional commercial loans. There are several ways that community banks can obtain the expertise needed to succeed in global trade. This article discusses opportunities as well as risks facing community lenders in supporting small and mid-sized enterprises (SMEs) engaged in international trade. To read more, go to http://www.fdic.gov/bank/analytical/regional/ro20052q/na/2005summer_04.html. FIGHTING FRAUD Free Webinar on E-mail Security September 14th at 3:00 p.m. Security breaches of confidential data are making the news every day - and that just covers the major leaks. Ensuring the privacy of confidential data is critical in this fast-paced electronic era. On September 14, at 3 p.m., the Conference of State Bank Supervisors will co-sponsor a free, one-hour Web-based seminar on minimizing security risk in electronic communications dealing with confidential information. This informative roundtable discussion led by Gartner Research will bring together a panel of financial and security professionals who will cover the issues surrounding data and email protection and discuss how e-mail encryption solutions can help. Page 3 of 14 Eric Ouellet, networking and information security analyst for Gartner, Inc., will moderate the discussion. Panelists include Mary Beth Puccinelli, Vice President, Regulatory Affairs, Conference of State Bank Supervisors; Doug Johnson, Senior Policy Analyst, Government Regulations, American Bankers Association; Gary Farrar, Executive Vice President and Chief Information Officer, Town North Bank, Dallas; and Edward Smith, Director of the ZixResearch Center, Zix Corporation. The Webinar is free, but pre-registration is requested. To enroll, go to http://www.zixcorp.com/newsroom/webseminar_gartner.php Guidance on Implementing a Fraud Hotline The FDIC is providing guidance to financial institutions on implementing a fraud hotline to minimize potential and actual fraud risks as part of a bank's governance and enterprise risk management program. The FDIC encourages financial institutions to consider the benefits of implementing a fraud hotline as a confidential communication channel to identify fraud and reduce fraud-related losses. The Association of Certified Fraud Examiners in its "2004 Report to the Nation" stated that organizations without mechanisms to report fraud suffered financial losses that were more than twice as high as organizations with anonymous fraud-reporting mechanisms. Awareness of the fraud hotline by employees, customers, contractors, service providers, suppliers, and other third parties is an important component in ensuring a hotline's effectiveness. The hotline's hours of operation should be extensive to ensure availability and should be staffed by experienced interviewers who can ask pertinent follow-up questions to determine whether an investigation should be initiated. Other recommendations included independence from bank management, confidentiality for callers, a tracking system for complaints, and investigation reports for the audit committee. Read more at http://www.fdic.gov/news/news/financial/2005/fil8005a.html. PROVIDES SHOPPER'S GUIDE The FDIC provides consumers with a shopper's guide for finding bank products and services in the summer 2005 issue of FDIC Consumer News. The guide includes tips and information on: comparison shopping and questions to ask before signing up for a mortgage, home equity loan products, a credit card, a checking account, or a certificate of deposit; how and why to make sure credit records are accurate and in the best possible shape; and how to determine if a free computer or some other attractive gift for opening a new bank account really is the best deal. The newsletter also covers fraud prevention, credit card minimum payments, and use of medial information in credit decisions. Read more at http://www.fdic.gov/news/news/press/2005/pr7805.html. UPDATED IT EXAMS The FDIC has updated its risk-focused information technology (IT) examination procedures. The new procedures are in response to the agency's new Information Technology Risk Management program announced in June. The new procedures focus on the financial institution's information security program and risk-management practices and results in a single IT "composite" rating, to be included in the consolidated Risk Management Report of Examination. Read more at http://www.fdic.gov/news/news/financial/2005/fil8105.html. Page 4 of 14 NAR and the Center for Responsible Lending Offers Mortgage Brochure A publication to educate consumers about abusive and risky lending practices was published recently by the National Association on Realtors and the Center for Responsible Lending. The brochure -- "Shopping for a Mortgage? Do Your Homework First" -- is part of a new consumer education campaign by NAR. The brochure helps consumers understand conventional loans, such as fixed-rate and adjustable-rate mortgages, and more exotic loan programs, including interest-only mortgages, 40-year, fixed-rate mortgages, negative amortization mortgages, and option payment adjustable-rate mortgages. "We're warning homebuyers to approach these new mortgages carefully," said Mike Calhoun, general counsel of the Center for Responsible Lending. According to a study by The Joint Center for Housing Studies of Harvard University, about 25 percent of the loans in 2004 were financed with an interest-only mortgage. Three years ago, these mortgages comprised only a few percentage points of the total mortgage market. Read more http://www.realtor.org/PublicAffairsWeb.nsf/Pages/NAR/CRLBrochure?OpenDocument. To access the brochure, go to http://www.realtor.org/HousOpp.nsf/files/specialty.pdf/$FILE/specialty.pdf. Page 5 of 14 The following is a summary of official action taken on applications by State Financial Institutions under Chapter 7-1 of the Code of Georgia and petitions for Certificate of Incorporation of Financial Institutions and other matters of interest during the month of August 2005. APPLICATIONS FOR NEW FINANCIAL INSTITUTION FINANCIAL INSTITUTION Flint Community Bank CAPITALIZATION $ 9,500,000 APPROVAL DATE 08-17-2005 BEGIN BUSINESS DATE 112 North Westover Boulevard Albany, GA 31707 Dougherty County Providence Bank 4955 Windward Parkway Alpharetta, GA 30004 Fulton County $ 14,000,000 Pending Sentry State Bank 245 Perimeter Center Parkway, Suite 600 Atlanta, GA 30346 DeKalb County $ 35,000,000 Pending Hometown Community Bank 6700 Highway 53 Braselton, GA 30517 Jackson County $ 10,300,000 02-21-2005 08-01-2005 Southern Bank & Trust 160 Louise Street Clarkesville, GA 30523 Habersham County $ 9,500,000 08-29-2005 Eastside Commercial Bank 895 Iris Drive Conyers, GA 30094 Rockdale County $ 12,000,000 08-05-2005 Jefferson State Bank 108 Canton Road Cumming, GA 30040 Forsyth County $ 11,000,000 Pending Page 6 of 14 Metro City Bank 5441 Buford Highway Doraville, GA 30340 DeKalb County Century Security Bank 5955 State Bridge Road Duluth, GA 30097 Fulton County Bank of Ellijay 134 Industrial Boulevard Ellijay, GA 30540 Gilmer County American Southern Bank 1450 Mansell Road Roswell, GA 30076 Fulton County Bank of Valdosta 301 Woodrow Wilson Drive Valdosta, GA 31602 Lowndes County $ 12,000,000 Pending $ 11,000,000 08-03-2005 $ 10,000,000 Pending $ 11,000,000 03-29-2005 08-30-2005 $ 6,000,000 Pending APPLICATIONS TO ESTABLISH A BRANCH OFFICE FINANCIAL INSTITUTION Northside Bank (IO) BRANCH OFFICE Cartersville Branch Office APPROVAL BEGIN BUSINESS DATE DATE Pending Adairsville 325 Cherokee Place Cartersville, GA 30121 Bartow County Bank of North Georgia Alpharetta Roswell Branch Office 10446 Alpharetta Highway Roswell, GA 30075 Fulton County 02-20-2004 08-15-2005 SunTrust Bank Atlanta Arlington Kroger In-Store Branch Office US Highway 70 & Airline Road Arlington, TN 38002 Shelby County 08-22-2005 Page 7 of 14 SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta State Road 70 Sam's Club In-Store Branch Office 5300 30th Street East Bradenton, FL 34230 Manatee County Barclay Branch Office 3236 Barclay Avenue Brooksville, FL 33601 Hernando County Celebration Water Tower Branch Office 74 Blake Boulevard Celebration, FL 34747 Osceola County Pan Am Safeway In-Store Branch Office 3043 Nutley Street Fairfax, VA 22031 Fairfax County Fort Walton Wal-Mart Branch Office 748 Beal Parkway, NW Fort Walton Beach, FL 32547 Okaloosa County Mack Hatcher Kroger In-Store Branch Office 3054 Columbia Avenue Franklin, TN 37064 Williamson County Poplar & Johnson Branch Office 9407 West Poplar Avenue Germantown, TN 38138 Shelby County Gulf to Lakes Wal-Mart Branch Office 2461 Gulf to Lakes Highway Inverness, FL 34450 Citrus County Lantana Branch Office 523 Ridge Road Lantana, FL 33462 Palm Beach County Pending 07-07-2005 Pending 02-21-2005 08-08-2005 08-22-2005 08-22-2005 08-08-2005 05-23-2005 Page 8 of 14 08-31-2005 03-31-2005 08-08-2005 SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta SunTrust Bank Atlanta Colony Bank Southeast Broxton First Madison Bank & Trust Colbert Marianna Wal-Mart Branch Office 2255 Highway 71 Marianna, FL 32448 Jackson County The Strand at Naples Wal-Mart Branch Office 5420 Cormorant Avenue Naples, FL 34109 Collier County Osprey Wal-Mart Branch Office 163 South Tamiami Trail Osprey, FL 34229 Sarasota County Palm Bay Wal-Mart Branch Office 1040 Malabar Road, SE Palm Bay, FL 32907 Brevard County Mirasol Branch Office 6289 PGA Boulevard Palm Beach Gardens, FL 33418 Palm Beach County Creighton Road Wal-Mart Branch Office 2650 Creighton Road Pensacola, FL 32504 Escambia County Savannah at Weston Branch Office 2575 Glades Circle Weston, FL 33327 Broward County Colony Bank Landmark Branch Office 6600 Abercorn Street, Suite 109 Savannah, GA 31404 Chatham County Athens Branch Office 780 US Highway 29 North Athens, GA 30601 Clarke County 08-08-2005 07-25-2005 Pending 07-25-2005 Pending 08-08-2005 Pending 08-26-2005 08-26-2005 08-24-2005 08-24-2005 Page 9 of 14 Columbus Bank and Trust Company Columbus First Nation Bank Covington Bank of Ellijay (IO) Ellijay Southern Community Bank Fayetteville 1st Georgia Banking Company Franklin 1st Georgia Banking Company Franklin 1st Georgia Banking Company Franklin 1st Georgia Banking Company Franklin River Road Branch Office 7001 River Road Columbus, GA 31904 Muscogee County Sigman Road Branch Office 433 Sigman Road Conyers, GA 30012 Rockdale County Canton Branch Office Riverstone Parkway and I-575 Canton, GA 30114 Cherokee County Highway 54 West Branch Office State Highway 54 West Fayetteville, GA 30214 Fayette County Columbus Branch Office 7320 Veterans Parkway Columbus, GA 31904 Muscogee County Homer Highway Branch Office 1989 Historic Homer Highway Commerce, GA 30529 Jackson County Dalton Branch Office 1394 Dug Gap Road Dalton, GA 30720 Whitfield County Jefferson Branch Office Northeast corner of US Highway 129 & Old Swimming Pool Road Jefferson, GA 30549 Jackson County 05-11-2005 08-02-2005 08-18-2005 Pending 08-25-2005 08-22-2005 08-22-2005 Pending Pending Page 10 of 14 The Heritage Bank Hinesville The Heritage Bank Hinesville Farmers and Merchants Bank Lakeland Southern Horizon Bank Leary Georgia State Bank Mableton American Trust Bank Roswell Sea Island Bank Statesboro Sea Island Bank Statesboro Darien Branch Office 1142 North Way Darien, GA 31305 McIntosh County Pembroke Branch Office 16 Railroad Street East Pembroke, GA 31321 Bryan County South Patterson Branch Office 1201 South Patterson Valdosta, GA 31601 Lowndes County Stockbridge Branch Office 280 Country Club Drive Stockbridge, GA 30281 Henry County Rockmart Branch Office 1201 Nathan Dean Parkway Rockmart, GA 30153 Polk County Cumming Branch Office 601 Tri-County Plaza Cumming, GA 30040 Forsyth County President Street Branch Office NE Corner of President Street and Drayton Street Savannah, GA 31406 Chatham County Wilmington Island Branch Office 319 Johnny Mercer Boulevard Wilmington Island, GA 31410 Chatham County 08-02-2005 04-20-2005 08-29-2005 08-26-2005 08-29-2005 08-01-2005 08-10-2005 08-15-2005 08-15-2005 Page 11 of 14 FINANCIAL INSTITUTION MERGERS FINANCIAL INSTITUTION (SURVIVOR) MERGED INSTITUTION CMAR Credit Union Marietta, GA Dixsea Federal Credit Union Atlanta, GA APPROVAL EFFECTIVE DATE DATE 06-27-2005 07-31-2005 APPLICATIONS TO CHANGE LOCATION FINANCIAL INSTITUTION Habersham Bank CHANGE LOCATION OF APPROVAL DATE EFFECTIVE DATE Big A Road Branch Office 08-26-2005 Clarkesville From: 1150 Big A Road Toccoa GA 30577 Stephens County To: 3886 Big A Road Toccoa GA 30577 Stephens County Oconee State Bank Watkinsville Butler's Crossing Branch From: 8821 Macon Hwy. Athens GA Oconee County To: 2000 Experiment Station Watkinsville GA 30677 Oconee County 08-10-2005 PROPOSED NAME AFB&T APPLICATIONS FOR RESERVATION OF A NAME COUNTY Clarke County APPLICANT Mr. John A. Fowler, SVP Athens First Bank & Trust Company Post Office Box 1747 Athens, GA 30603 Delta Community Credit Union Fulton County Mr. Rick Foley, President/CEO Delta Employees Credit Union 1025 Virginia Avenue, Dept 930 Atlanta, GA 30354 HavenTrust Bank DeKalb County Mr. Ed Briscoe, EVP/CFO Horizon Bank 6340 Sugarloaf Parkway, Suite 100 Duluth, GA 30097 Page 12 of 14 Midtown Bank Patriot Bank of Georgia River City Bank Woodstock Bank & Trust Fulton County Forsyth County Floyd County Cherokee County Ms. Kelly G. Yeadon, Paralegal Powell Goldstein LLP 1201 West Peachtree Street Atlanta, GA 30309 Mr. John B. Kline, President Kline & Associates Post Office Box 418 Decatur, GA 30031 Mr. John B. Kline, President Kline & Associates Post Office Box 418 Decatur, GA 30031 Mr. Brent H. Baker, President Brent Baker, Inc. 6020 Rose Hill Court Cumming, GA 30041 APPLICATIONS TO BECOME A BANK HOLDING COMPANY AND/OR TO ACQUIRE VOTING STOCK OF A FINANCIAL INSTITUTION BANK HOLDING COMPANY TO ACQUIRE APPROVAL DATE FORMATIONS Northside Bancshares, Inc. Adairsville, GA Northside Bank (IO) Adairsville, GA Pending Atlanta Bancorporation, Inc. Alpharetta, GA Bank of Atlanta (FSB) Alpharetta, GA Pending CCB Financial Corporation Jonesboro, GA Community Capital Bank Jonesboro, GA Pending ACQUISITIONS CompuCredit Corporation Atlanta, GA Sentry State Bank (IO) Atlanta, GA Pending ABC Bancorp Moultrie, GA First National Banc, Inc. St. Marys, GA Pending Page 13 of 14 CITY Macon * Newnan Americus * Macon Winder Sugar Hill Atlanta * Lithia Springs Winder * Augusta * Carrollton Rome * Columbus Hazlehurst * Canton Stone Mountain Athens * Baxley * Gainesville Harlem * Newnan Macon * Jefferson Ellaville LaGrange Fort Valley * * =Exempt (O.C.G.A. 7-1-709) CHECK CASHER LICENSES ISSUED APPLICANT NAME Akshar Group, Inc. Attics Self Storage of Newnan, Inc. Bhawani Krupa, Inc. Bradberry, Jimmy L. C. Store Management, Inc. Dos Amigos Check Cashing & Grocery, Inc. Enterprise 2850, LLC First Class Mart, LLC Golden Bottle Shop, Inc. Han, Kwi Suk Hernandez, Ilsa Krupa of Rome, Inc. Love's Jewelers & Pawn, Inc. Mata, Inc. McFarland Foods, Inc. Parikh, Kanaiyalal R. Parra, Kristina Reeya & Damini Food Mart, Inc. Reyes, Inc. Shri Shiv Shakti, Inc. Smart Financial of Georgia, Inc. Standard Motor Enterprises, Inc. Tabo's C. Store, Inc. Veatch Foods, Inc. Yarbrough's Finance Corporation Young, Marshall TRADE NAME Topline Spirits Attics Self Storage Shop Rite Pride Package Store Shell Food Mart Dos Amigos Check Cashing Busy Bee Thornton Road Food Mart Golden Bottle Shop Sam's IGA Supermarket Latino Express Chuck's Corner Love's Jewelers & Pawn 221 Quick Stop McFarland's IGA Mail Fax Shipping Liberty Services Hungry Lion Reyes Harlem Mini Food The Money Banc Topline Tabo's Food Mart IGA Supermarket Yarbrough's Title Pawn Young Super Foods MONEY TRANSMITTER LICENSES ISSUED MONEY TRANSMITTER APPROVAL DATE Western Club, LLC East Point, GA 08-18-2005 Page 14 of 14