Arkansas
State Bank Department
State Banking Board
Meeting Minutes for
October 4, 2001
(updated February 27, 2002)
A special meeting of the State Banking Board was held in the conference room of the Arkansas State Bank Department, 400 Hardin Road, Suite 100, Little Rock, Arkansas, at 10:20 a.m. on Thursday, October 4, 2001. The following Board Members were present: Chairman Phyllis Kincannon, Vice Chairman Judy Loving (via conference call), Board Members David Bartlett, Bob Douglas and Gus Rusher. Theodore C. Skokos, Sr. was absent. Representing the State Bank Department were Commissioner Frank White, Deputy Commissioners Don R. Clark and Candace Franks, Assistant Chief Examiner Wilks Marshall, Commissioned Senior Examiner & Financial Analyst Richard Plotkin, Management Project Analyst Cynthia Nixon, Administrative Assistants II Barbara Mahoney and Marilyn Myers. Assistant Attorney General Tom Gay was present representing the Attorney General's Office. Crystal Garrison from Bushman Court Reporting was the recording reporter for the applicants. No representatives from the media were present.
State Bank Commissioner, Frank White, called this special meeting of the State Banking Board. Notices of the special meeting were sent by regular mail to each member of the State Banking Board on August 29, 2001. The notices were also given to the news media in accordance with state law.
Commissioner Frank White opened the meeting. Secretary Don R. Clark declared there was a quorum with four of the six Board Members present (Mrs. Kincannon, Mr. Bartlett, and Mr. Rusher with Ms. Loving on the speaker phone). Commissioner White opened the meeting and asked the visitors and guests to stand and introduce themselves and whom they represent. He then turned the meeting over to Chairman Phyllis Kincannon.
First on the agenda was consideration of the minutes of the July 19, 2001, regular meeting. A motion was made by Gus Rusher, seconded by David Bartlett, to approve the minutes as presented. The motion carried and the Commissioner concurred.
Next was approval of expenses for the Board. A motion was made by David Bartlett, seconded by Judy Loving, to approve the Board's expenses. The motion carried and the Commissioner concurred.
Item 4 was consideration of an application by Mcllroy Bank & Trust, Fayetteville, Arkansas, to merge Springdale Bank and Trust, Springdale, Arkansas, with and into McIlroy Bank & Trust. Randy Dennis of DD & F Consulting Group represented the applicant and explained Arvest Bank group planned to merge and consolidate all their banks into McIlroy Bank. A motion was made by David Bartlett, seconded by Gus Rusher, to approve the application. Motion carried and the Commissioner concurred.
Item 5 on the agenda was consideration of an application by McIlroy Bank & Trust, Fayetteville, Arkansas, to merge Central Bank & Trust, Little Rock, Arkansas, with and into Mcllroy Bank & Trust. Randy Dennis spoke for the applicant. He commented each of the merged banks would maintain an active Advisory Board. A motion was made by David Bartlett, seconded by Judy Loving, to approve the application. Motion carried and the Commissioner concurred. Bob Douglas, due to traffic problems, was late arriving at the meeting. Upon his arrival, he asked the record to show he voted for approval on Items 4 and 5 on the agenda.
Item 6 was consideration of an application by McIlroy Bank & Trust, Fayetteville, Arkansas, to merge The Farmers & Merchants Bank, Prairie Grove, Arkansas, with and into McIlroy Bank & Trust, and to change the name of the bank to Arvest Bank. Randy Dennis represented and spoke for the applicant. A motion was made by Gus Rusher, seconded by David Bartlett, to approve the application. The motion carried and the Commissioner concurred.
Item 7 on the agenda was consideration of an application for a charter amendment by Mcllroy Bank & Trust, Fayetteville, Arkansas, to amend and restate its Articles of Agreement and Incorporation to include, but not limited to, changing the name of the bank to "Arvest Bank" and changing the number of directors to consist of not less than three (3) nor more than twenty‑five (25) members. Randy Dennis represented and spoke for the applicant. Gary Head, President and Chief Executive Officer of Mcllroy Bank & Trust commented the bank will do everything it can to protect the McIlroy bank name. A motion was made by David Bartlett, seconded by Judy Loving, to approve the application. Motion carried and the Commissioner concurred.
At this point in the meeting the Commissioner received information that the Eighth Circuit Court upheld the lower court ruling on the Usury override.
Next on the agenda was consideration of a proposed regulation for charter amendment application for change of bank corporate name. Gus Rusher commented the regulation should be amended to include that trade mark search of names will be done in the exact, or almost exact, name request. A motion was made by David Bartlett, seconded by Gus Rusher, to approve the regulation as amended. Motion carried and the Commissioner concurred.
Item 9 was a proposed regulation for fictitious names. Bob Douglas commented he felt the Board should have input from the industry in reference to these regulations. Gus Rusher stated he talked to several bankers and these are non‑controversial regulations. After general discussion it was felt this regulation should also be amended to include that trade mark search of names will be done in the exact, or almost exact, name request. A motion was made by David Bartlett, seconded by Gus Rusher, to approve the regulation as amended. Motion carried and the Commissioner concurred.
Item 10 was consideration of a proposed regulation
for reservation of bank corporate name. It was agreed this regulation should
also be amended to include the above trade name search. A motion was made by Gus Rusher,
seconded by David Bartlett, to approve the regulation as amended. Motion
carried and the Commissioner concurred.
Item 11 was consideration of a proposed regulation
for county or regional industrial development corporations. Jim Taylor,
Attorney for Pulaski County Industrial Development Corporation, stated he was
instructed to oppose this regulation and recommend it be amended to include
"just cause" in the penalty clause, this being his main objection.
Staff Attorney Candace Franks explained the purpose for the regulation. She
commented the Department has had a serious problem getting the industrial loan
facilities to file their required reports in a timely manner. The purpose of
the regulation is to promote timely filings. Commissioner White explained the
purpose and reasons for industrial development corporations, noting seven (7)
are active. He commented he has had a problem with Pulaski County Industrial
Development Corporation ‑ they have opposed everything the Department has
done. David Bartlett questioned whether thirty (30) days is a long enough
period of time to file the reports. Mr. Taylor stated there has been a long
time feud going on with the Securities Department and Bank Department. A motion
was made by Gus Rusher to table action on this regulation, as he was not
prepared to vote. The motion was seconded by David Bartlett. Motion carried and
the Commissioner concurred.
At this point Commissioner White shared information
from Dick Barkley, Director of DF&A, about cutbacks in state government. He
explained the Department's budget, noting our biggest problem is loss of
experienced personnel. It has been very difficult to maintain a full examining
staff in the Fayetteville area. We have now gone to four ten‑hour
workdays. David Bartlett stated he was in favor of this as it gives a bank
being examined time to regroup on Friday.
The Commissioner told the Board that overall the
Department is seeing deterioration in banks ‑ with fourteen (14) banks under
regulatory letters. Return on assets is around .50% in several banks. He stated
he is generally optimistic, trying to be prepared ‑ going to see some tough times, it's
going to be important to watch the bottom line ‑ noting, because of this,
it's going to be tough to raise capital. He told the Board about the failed
national bank in Gravette. David Bartlett asked if there had been any runs on
banks in Arkansas because of September 11°' terrorist attacks. Commissioner
stated there were none.
Commissioner White stated
the news from the Eighth Circuit Court was tremendous and this should help
banking in Arkansas.
No further business, Gus Rusher made a motion to adjourn, seconded by Judy Loving. Motion carried and the Commissioner concurred.
