FirsTier Bank News

Below please find a series of personal messages from FirsTier Bank Chairman & CEO, Timothy D. Wiens

Friday, February 26, 2010

Dear Valued Customer,

Thank you for banking with FirsTier Bank. We value and appreciate your business and want to share some information with you about our bank.

Like many businesses and banks in Colorado and across the nation, we have been negatively impacted by the downturn in the economy and the impact the downturn has had on our customers’ businesses. We’re proud of our history of serving our local communities, but some of our loan customers have been hit particularly hard by falling real estate values and we expect that they will continue to deal with these circumstances for some time.. We see signs that the economy is beginning to improve, however we expect that it will take time before there’s significant improvement.

Bank regulators, as part of their normal review process, review the impact of the economic downturn on the bank’s loan portfolio. During our most recent review, examiners identified some issues with our loan portfolio and as a result, we’ve entered into an Agreement to address their specific concerns.

Our management team has been working to improve these areas of concern and we have made significant progress. Rest assured that our entire team remains committed to working through this situation with our loan customers and we are confident we will be able to do so successfully.

Most importantly, this Agreement does not impact your accounts or loans with us. Your money continues to be insured by the FDIC up to $250,000, and in many cases, much more than that. If you have questions about your FDIC insurance, please speak with your banker or call the toll-free FDIC hotline at 1-877-275-3342. I have also included several questions and answers below.

Thank you for being a customer of FirsTier Bank. We appreciate your business and your loyalty and look forward to continuing to serve your financial services needs for many years to come.

Timothy D. Wiens, Chairman & CEO

I understand the bank has been issued a Consent Agreement. What does that mean?
A Consent Agreement is an agreement between regulators and the bank and is designed to identify and help banks improve their performance.

The downturn in the economy and real estate market has impacted many customers of the bank causing an increase in the number of loan customers who are unable to make their loan payments. This situation has hurt our financial performance.

Is my money safe and should I be concerned about my accounts?
Your accounts are safe and are insured up to at least $250,000 by the FDIC. If you have any questions related to your accounts, we’d be happy to review them with you to ensure that you are adequately covered.

Or, you can call the FDIC Hotline at 1-877-275-3342 or visit their website at https://www2.fdic.gov/EDIE/index.html to utilize their Electronic Deposit Insurance Estimator which will help you calculate the insurance coverage of your accounts.

Is the bank going to be closed or sold and how can I be assured it’s not going to be?
No - the Agreement does not suggest that the bank will close. We are committed to meeting the terms of the Agreement and look forward to serving our communities for many years to come.

Are any of your employees impacted by this Agreement?
We have no plans to make any changes to our staff or our management team. We remain dedicated to providing you with personalized service to meet your financial services needs.

If you have additional questions, or if we can help you in any way, please call or visit one of our branches.


Navigating the "New" Normal- December 11, 2009

As we reach the end of 2009, what will we remember? Will we remember it as the worst economy ever? Will we remember the impact on banking? Will we remember the lending freeze? Or, will we remember this as the beginning of the new normal? Many lessons have been learned as we continue to endure many changes such as higher capital ratios required by regulators (for the banks) and more stringent underwriting standards (for small business and the consumer). These changes create a new banking environment and a new normal for all of us.

Meanwhile, legislators are becoming concerned about the potential long-term impact the new normal will have on an economic recovery and how to implement the programs necessary to fuel such a rebound. Community bankers are inwardly focused on raising capital, dealing with problem loans, and cleaning up their balance sheets. The large banks have already done this and are now paying back the Government provided TARP funds through profits and access to capital markets.

Banking is a very competitive business, from interest rates to market share, convenience, and many other factors. The competition has been and always will be healthy and good for the consumer providing different choices of products and services offered, locations, and most importantly, the people. As the banking industry completes its metamorphosis, it is important to have different banking alternatives to service your needs. Community banks remain vitally important to businesses and consumers and are key to economic recovery.

As the saying goes “a rising tide lifts all boats,” but banking may just need to return to the basics. Community banking is a process of gathering local deposits, and then based on relationships and local knowledge, returned back to local communities in the form of loans to grow Main Street, America. Community banks are built on these relationships that continue to stand the test of time.

Traditionally, banking has been a noble profession. There was a day when many banks had the words “Bank and TRUST” in their name, and it meant just that. Overall, the entire banking industry needs to regain the trust of the American consumer. Community banks already are a step ahead in that regard.

I thank you for your time and interest in reading these letters over the past few months. Finally, I’ll end with the sales pitch -- support your local community banks. We are not through this yet, but there are many signs of improvement; and together, we can navigate the new normal.

Merry Christmas!
Timothy D. Wiens, Chairman and CEO

Waiting for the Thaw- November 27, 2009

Small businesses and entrepreneurs have always been critical to an economic rebound. With access to capital, especially from community banks, these businesses drive economic recovery and more robust job creation. Unfortunately, small businesses and borrowers are living with a banking system that has its hands tied by regulatory actions that have limited its’ ability to make loans.  
   
Community banks survived the 1980’s, when the economy presented challenges for many business customers further impacting their ability to make their loan payments. Community banks helped them by restructuring their loan commitments with the belief that in the long run these businesses would survive and thrive, and most of them did.

Funding to these economic growth engines has been stalled as local community banks are busy dealing with more stringent lending requirements. They no longer have the flexibility to work with their customers, including those in commercial real estate.

This lending freeze is having such an impact that lawmakers such as House Banking Committee Chairman, Barney Frank, are warning about the potential impact it could have on the recovery. There are, however, signs that things are changing. The FDIC released new guidelines at the end of October, and lawmakers are recommending support at the community bank level not just at the “too-big-to-fail” level. Sheila Bair, FDIC Chair, has made it clear that she understands the community banker’s frustration with a financial crisis that they did not create.

Is this the crack in the iceberg? Although it will take time to actually trickle down, help could be on the way.

Community banks are key (if not THE KEY) to economic recovery. FirsTier, along with every other community bank in America, remains hopeful that this trickle down will turn into a legitimate flow to help main street America be all that it can be again.

Sincerely- Timothy D. Wiens, Chairman and CEO

The Domino Effect- November 13, 2009

First the economy started to deteriorate, and with it went previously healthy businesses, especially those in commercial real estate. As these businesses suffered, many lost their ability to make payments on their loans to their local, community banks.

Bank regulators, seeing the impact of missed loan payments on the longer term health of a bank, placed restrictions on banks and how they work with their clients in this situation. Often, regulators require banks to impose a difficult payment schedule or require additional collateral from the borrower. When the borrower can’t meet those demands, the bank must foreclose. 

So, in many cases a borrower is forced to sell at discounted prices to raise cash, thus lowering the market value of the collateral and causing lower appraised values going forward.

Additionally, sound loans are being criticized by regulators merely because the borrower is a member of an industry currently under economic stress and irrespective of a loan’s payment history or the strength of the borrower/guarantor. These restrictions mean less lending by all banks, and further hardships for already struggling businesses.

All of this ultimately results in you or your neighbors losing jobs, creating a domino effect since less taxes paid means less services in your community. When you really need a loan, your bank is unable to help you.

The fact is your community banker would rather weather the storm with a customer they believe in – as they have done in the past. However, in this highly regulated environment, they’re not able to do so.

We hope that regulators will recognize the impact these restrictions have placed on community banks, and reevaluate the need for a more balanced approach, so community banks can once again fulfill the important role they play within their communities.

For most of us, this is not our first recession. It certainly is not the first for regulators and lawmakers. With patience and time, we know that the community banks will come back stronger than ever. We hope regulators and lawmakers come to see it that way as well.

Sincerely- Timothy D. Wiens, Chairman and CEO

Times Are Changing-  October 27, 2009

It’s time to begin thinking about how important a community bank is to the economic health of our local communities. There has been much focus on the big Wall Street banks, but it’s time to think locally. New and more difficult standards from the government, along with a clear preference for large banks, make this even more difficult on Colorado community banks. This trickles down even further to the Colorado consumer and small businesses.

A quick glance at the financial health of Colorado’s community banks reveals a startling decline in their collective financial condition over the past two years. The crushing weight of commercial real estate loans combined with historically low interest rates and the struggle of the small businessman have caused community banks to rack up losses in amounts not seen in our state since the Great Depression.

Suppose all community banks just disappear. Without locally run banks, like FirsTier, area businesses will become dependent on decision makers who do not live in our communities. Without community banks, our communities will be deprived of a much needed source of capital that will be critical to fuel the recovery and subsequent growth of our local businesses. Our communities would be dependent on bankers who live, work and trade in other cities and don’t share the enthusiasm for our community. Thus, local economic recovery will be slower in coming and be less robust.

If you don’t think having a bank headquartered in your community is important, we invite you to look more closely at the Wall Street banks...they could easily be your new bank, as the choice will not be yours. The Government wants fewer banks and your money will end up in another city or state.

There are two things you can do to help: 1) Open an account and deposit money at FirsTier Bank or another community bank; and if you already have an account, then keep it open and deposit more money into it. Your money is safe with us as the FDIC insures your deposits up to $250,000. FirsTier Bank is just like any other local business – we depend on your support and patronage. 2) Tell your Senator, your Congressman, and/or your local government officials “not to kill the community banks.”

We are your neighbors, friends and family members. We stand ready, willing and happy to serve you. Our local economic independence is at stake. We’re all in this together.

Sincerely- Timothy D. Wiens, Chairman and CEO

Community Banking 101- October 13, 2009

Com·mu·ni·ty (noun)

“A feeling of fellowship with others, as a result of sharing common attitudes, interests and goals.”

As a community bank, we believe the definition of the word “community” says it all. Because that is what this nation’s community banks were designed to do - provide financial services to serve the needs of their communities.

The main advantage of a community bank over a larger bank becomes apparent when you need a loan or financial service expertise.  At a community bank you are a friend and a neighbor, not just another applicant. When you develop a personal relationship with your local community banker, you have a much better chance of success when it comes to getting the financial services you need when you need them.

There might have been a time when bigger banks could offer more sophisticated banking products, such as advanced online banking or bill pay technology, but that is not the case now a days. Technology is a great equalizer, and most community banks provide the same services as the big guys - with the same FDIC assurances. 

For most of us, the choice is a personal one. Do you choose a larger bank that provides locations on every street corner, but impersonal service? Or do you choose a smaller bank where you have access to the decision-makers and professionals who can make an immediate difference for you?
Your local, community banker knows you are an important customer, no matter how much money you have in the bank.

Thank you from all of us at FirsTier Bank. We look forward to serving you.

Sincerely- Timothy D. Wiens, Chairman and CEO

Weathering the Storm Together- Sept 14, 2009

Is your bank safe?  That seems to be the question of 2009.  It would appear to be a simple yes or no question, right?  Not necessarily. The quick answer is, more than likely, yes. Certainly, as long as you are within the FDIC insurance guidelines you need not worry with any FDIC insured bank. Our government has propped up the big banks; but the community banks, by and large, have been left out of that equation. So, how safe is FirsTier Bank and other community banks?

Community banks all over the nation are experiencing unprecedented challenges with increasing levels of non-performing loans, declines in the value of appraised real estate collateral, and increased loan loss provisions.  FirsTier, along with many other Colorado community banks, is fighting these same challenges. We are trying hard to keep our local businesses in business! This could mean you, your neighbor, or the friendly lady at the sandwich shop. Community banks and our communities we serve need to stand united. Our commitment remains true to our communities. We have long said that we understand our neighborhoods, living and working within them, and now is the time to show that we are all going to see this through together. We have come a long way in the past year, but the rocky road will continue for a little while longer.

As experienced bankers, we have seen previous difficult cycles, and have navigated through them. Community banks, like FirsTier, are typically locally owned and operated. We consider ourselves a traditional bank – not an investment or “Wall Street” bank. Other banks like ours are suffering right along with you, our communities. FirsTier Bank (and most community banks) did not make subprime loans or engage in unethical practices, and the perception is that all banks are the same. They are not. We will continue to meet the needs of our customers and provide the products, services, and responsiveness you have come to expect and deserve. Our desire and dedication to our customers and community will not waiver.    
                      
At FirsTier Bank our goal is to be proactive in our communications so that our customers feel comfortable, secure, and well informed. We have a solid, well-thought-out plan for getting through the current market and dealing with the resulting challenges. We continue to demonstrate that we can execute our plan, and our team remains dedicated despite the tough economic conditions for all. 

FirsTier Bank has a long history in the banking industry and plans on continuing for years to come. We demonstrate every day that our management and staff have the experience and confidence to navigate through these rough times. We will work hard to protect our customers, our community, our bank, and the real backbone of the financial community – the community bank.

We are confident in our ability and thank you for your loyalty and support during these times, not only to FirsTier Bank, but all of your local community banks.

Sincerely- Timothy D. Wiens, Chairman and CEO