Council Applauds House Passage of Financial Reform Bill

/PRNewswire/ -- The Council of Institutional Investors applauds the House of Representatives' efforts to strengthen the regulation of the U.S. financial system through the reforms contained in the Wall Street Reform and Consumer Protection Act of 2009 (H.R. 4173).

The Council is grateful to Representative Barney Frank (D-Mass.), chairman of the House Committee on Financial Services and prime sponsor of the bill, for his leadership on this important and comprehensive legislation.

"The House of Representatives has taken a significant step toward restoring trust in U.S. financial markets," said Ann Yerger, executive director of the Council of Institutional Investors. The Council believes that the global financial crisis revealed critical gaps in the regulation of U.S. markets and the urgent need for improvements in corporate governance. "The Wall Street Reform and Consumer Protection Act gives regulators and investors new tools to oversee financial firms more diligently and promote market stability," Yerger added.

Many provisions of the act are in tune with Council priorities and the recommendations of the Investors' Working Group, which the Council has endorsed. In particular, the Council welcomes the act's affirmation of the authority of the Securities and Exchange Commission (SEC) to give shareowners the right to place their nominees for directors on company proxy cards. Making it easier for investors to nominate their own candidates for director would invigorate board elections and make directors more responsive, thoughtful and vigilant.

The Council also lauds measures in the legislation that enhance the oversight and accountability of credit rating agencies and bolster the resources of the SEC. However, the act's provisions to regulate over-the-counter derivatives trading, while an improvement, need to be strengthened.

Passage of the Wall Street Reform and Consumer Protection Act of 2009 marks progress toward an urgently needed, broad overhaul of financial markets and corporate governance regulation. The Council looks forward to Senate approval of comprehensive regulatory reform legislation next and is eager to work with Senate Banking Committee Chairman Christopher Dodd (D-Conn.) and Senator Richard Shelby (R-Ala.), ranking member of the Senate Banking Committee, on the proposed Restoring American Financial Stability Act of 2009.

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State Bank and Trust Company Acquires Assets and Deposits of The Buckhead Community Bank and First Security National Bank from FDIC

/PRNewswire/ -- Georgia Department of Banking and Finance and the Office of the Comptroller of the Currency announced December 4 that State Bank and Trust Company has agreed to acquire assets and deposits of The Buckhead Community Bank and First Security National Bank, in a transaction facilitated by the Federal Deposit Insurance Corporation (FDIC).

State Bank is one of Georgia's healthiest and best capitalized community banks with branches throughout Middle Georgia and Metro Atlanta. As of December 5, 2009, all bank branches previously owned and operated by Buckhead Community Bank and First Security National Bank will become branches of State Bank.

The Buckhead Community Bank was founded in 1997 in Atlanta with branches in Buckhead and Midtown, as well as Sandy Springs, Alpharetta, Cobb County, Cumming and Gainesville. As of Sept. 30, 2009, the bank had $856.2 million in assets and $813.7 million in deposits.

First Security National Bank was founded in 1985 in Norcross, Georgia with branches in Atlanta, Cumming, and Canton. As of Sept. 30, 2009, First Security had more than $128 million in assets and $123 million in deposits.

The acquisitions became effective at the close of business on Friday, after regulators closed the banks and named the FDIC as receiver. The FDIC then approved the whole bank acquisitions with loss share by State Bank, which includes all deposits, loans and other assets.

State Bank was determined the winning bidder after submitting to the FDIC a bid for the assets and deposits of the banks. With FBR Capital Markets serving as placement agent, State Bank previously raised close to $300 million, including investments from the executive management team, to provide the capital to facilitate these acquisitions.

This is the second FDIC transaction that State Bank has completed. In July 2009, State Bank acquired certain assets and deposits of the bank charters owned by Security Bank Corp. That acquisition made State Bank the market leader in Middle Georgia with a presence in Metro Atlanta. Evans and the State Bank management team previously led Flag Financial Corp., which was acquired by RBC Centura in 2006.

"With the addition of these two established community banks, State Bank solidifies its position as one of the best capitalized and largest community banks in metro Atlanta," said Joe Evans, chairman and CEO of State Bank. "We are especially pleased to have secured a presence in Buckhead, where my team and I were so successful at Flag Bank."

"We have made great progress with our integration of the former Security Banks. Our strong capital position and depth of experience allows us to continue to pursue other opportunities that fit our strategic goals," Evans said. "As we stated previously, developing a significant presence in Metro Atlanta is a central part of our strategy."

"Our first order of business is to assure the customers of these banks that their deposits are safe, sound and readily accessible," Evans added. "State Bank is one of the healthiest financial institutions in Georgia, with a sound balance sheet and very strong capital ratios."

Customers of The Buckhead Community Bank and First Security National Bank should continue to use their existing branches, checks, ATM or debit cards. If clients have any questions regarding their accounts involved in this transaction, they should continue to use the same channels as they have in the past, including contacting their local branch. All offices and branches will be open during their normal days and hours as in the past.

For more information, bank customers can contact State Bank at 1-800-414-4177 or visit their branch location. They can also go to www.StateBT.com.

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Market Gains in November Boost Funding Status of U.S. Pensions, According to BNY Mellon Asset Management

/PRNewswire/ -- U.S. stocks rose 5.7 percent in November, contributing to a 2.6 percentage-point improvement in the funded status of the typical U.S. corporate pension plan, according to monthly figures published by BNY Mellon Asset Management. The funded status of the typical plan improved to 82.5 percent at the end of November, which was the highest level since May, and up from 79.9 percent at the end of October, according to the BNY Mellon statistics.

Assets for the typical U.S. corporate plan rose 3.6 percent, outpacing the 0.2 percent gain in liabilities during the month, which reflected interest accruals as the discount rate for November was unchanged from October. For the year, through November 30, the funding ratio for the typical plan is up 8.6 percentage points, as represented by the BNY Mellon Pension Liability Index.

"U.S. corporate pension plans continued their road to recovery as domestic and international equity markets registered strong results," said Peter Austin, executive director of BNY Mellon Pension Services, the pension services arm of BNY Mellon Asset Management. "Equities have rallied in eight of the last nine months and have been the driving force for the funding improvement. Liability discount rates are only 14 basis points lower for the year, which has limited the impact on pension plan liabilities. Plan sponsors that maintained their equity allocations, which hasn't been easy given market volatility, have been rewarded for their commitment to their strategic asset allocation."

Plan liabilities are calculated using the yields of long-term investment grade corporate bonds. Lower yields on these bonds result in higher liabilities.

"With funding levels near 2009 highs and 2010 financial planning underway in many organizations, there is increased interest in discussing pension risk reduction programs," said Austin. "These programs would include new or increased allocations to liability driven investing (LDI) strategies. Plan sponsors remain fearful of plan surplus/deficit volatility, which remains a relevant topic given the fragility of the global markets."

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The Consumer Credit Bureaus are Unraveling American Self-Reliance and Compromising Our Greatest National Assets: The Individual and Small Business

/Standard Newswire/ -- The Consumer Credit Reporting Bureaus, which purport to help lenders
evaluate risk, control the flow of credit and encourage fiscal responsibility, have instead played a significant role in destabilizing the economy and are impeding America's recovery.

It is a predatory system that seizes on financial hardships and turns short-term setbacks into long-term liabilities. For the small business owner, he risks losing not only his business but also his personal livelihood and often a lifetime of investment.

And the nation loses its critical buffer: the once-resilient small business, when 'big business' falters.

"The Consumer Credit Bureaus have been ruthlessly chipping away at small business and are now derailing America's economic recovery. We created the website
www.abolish-the-credit-bureaus.com (http://rs6.net/tn.jsp?et=1102862490430&s=13633&e=001-W_WIUx6oUMs-HrxjHW-kUMAKm-mqGf8-RqK0quO-dbijcIIobiKZ5H55jw28xFYz0vX66C5COpZBuxbiFlL30CbIO4k32wakPqjbtyOvY80th7xxAqN3_ozoDI3Pjaq1cd--vN5l44=), Video-short and Petition as vital tools for change; including examining recent comments by President Obama and Federal Reserve Chairman Bernanke," says small business owner, Deborah Fineout-Launey, of marketing firm LHH&F.

"Second mortgages, personal credit cards, large personal guarantees and the Consumer Credit Score should not be the tools for corporate lending. A national summit on small business is meaningless without lending reform," says Ms. Fineout-Launey.

When economic setbacks or downturns occur, many in the economy are affected - not because of
credit 'abuse.'

Yet, in this system, the small business owner, working in good faith to stabilize his business and
ride out the economy, finds that:

· A personal debtor's prison quickly arises;
· Leading to usurious fees;
· Loss of essential banking relationships;
· Credit defaults increase;
· Assets, personal and corporate, are stripped;
· Putting all parties' investments in escalating risk

The result is the unmerited loss of viable small businesses, loss of essential tax revenues, rampant unemployment, loss of real estate leases, healthcare, personal livelihoods, home foreclosures, and a dangerously weakened middle class.

"It is time to abolish the Consumer Credit Report and Score from small business lending and, frankly, in general. It reduces the small business owner's significant investment, and the investment of his lenders, to a gamble of epic proportions. It is a matter of moral conscience and economic necessity," she adds.

Robert Launey and Deborah Fineout-Launey are small business owners in New York, committed to drawing attention to the economic fallout created by the Consumer Credit Report and Score in small corporate lending.

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Upcoming Tax Season Provides Unique Tax Savings Opportunities through Roth IRA Conversions

/PRNewswire/ -- A change in the federal tax law, effective January 1, 2010, will permit Roth IRA conversions for taxpayers at all income levels. In the past, this option was only available to those with an adjusted gross income of $100,000 or less.

"Taxpayers may now convert part, or all of their assets from a traditional IRA into a tax free Roth IRA," says Kevin McCormack, President of Pension Parameters Financial Services.

"While many individuals and businesses are carefully scrutinizing their budgets, creating a Roth and taking advantage of a unique opportunity this year and next, and in some cases, even borrowing money to cover an investment like a conversion today, can pay off."

Details related to the change include:
-- Any portion of a traditional IRA may be converted
-- Conversion to a Roth IRA in 2010 allows for a 50-50 income tax split
for the 2011 and 2012 tax years - and the split is only applicable if
you convert in 2010
-- Though account balances have decreased in the past 18 months, the
upside is that reduced balances will lower conversion tax and yield
the potential to recover in a tax-free account
-- With tax rates at an historical low, converting to a Roth IRA in 2010
may help protect retirement assets should tax rates rise


Pension Parameters has been helping self-employed individuals and small business owners with retirement plan development and investment management since the 1970s. The company is known for its customized retirement plans and extensive follow-up with clients. McCormack states, "Unlike many pension plan managers, we do not simply collect monies and set up the plan and invest. When we see market changes, our market manager personally calls each client to recommend the right move to make."

According to McCormack, those establishing their first company retirement plans are often confused about their options such as a 401(k) plan, which allow owners and employees to make contributions through pre-tax payroll deductions, or a defined benefit plan, which may allow a business owner to make the highest possible annual contribution to his or her retirement account. Pension Parameters lately has been recommending new comparability plans, a profit-sharing option that allows certain businesses to make discretionary contributions to a qualified plan.

A Roth IRA ultimately saves tax dollars as well. Since you have already paid the tax upfront when establishing the account, the need to pay tax later is eliminated. The money you make in a Roth IRA will all be yours (or your heirs) in the end, not the government's.

Pension Parameters Financial Services is a New York and New Jersey based full service 401(k) plan provider including investment advisory and management services for the small business market. For more information regarding Pension Parameters or Roth IRA savings opportunities call: 212-675-9360 or visit them on the web at http://www.pensionfinancialservices.com/.

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Barrick shuts hedge book as world gold supply runs out

Aaron Regent, president of the Canadian gold giant, said that global output has been falling by roughly 1m ounces a year since the start of the decade. Total mine supply has dropped by 10pc as ore quality erodes, implying that the roaring bull market of the last eight years may have further to run.

"There is a strong case to be made that we are already at 'peak gold'," he told The Daily Telegraph at the RBC's annual gold conference in London.
http://www.telegraph.co.uk/finance/newsbysector/industry/mining/6546579/Barrick-shuts-hedge-book-as-world-gold-supply-runs-out.html

Statement: Alan Essig, Executive Director, on October Revenue Decline and Worsening State Budget Deficit

The dismal October revenue numbers released today underscore the depth of Georgia's fiscal crisis. For these first four months of the new fiscal year, revenues are down by 15.1 percent.

The governor's preliminary analysis of the FY 2010 revenue projection estimates a 6.2 percent revenue decline, a decrease from the nearly 4.0 percent revenue decline the governor announced in July.

Although there has been no public announcement, this analysis is contained within the Official Statement for the State of Georgia General Obligation Bond Sale dated October 26, 2009.

The revised projection means Georgia likely is facing a $1.26 billion budget shortfall. This is an additional $320 million budget shortfall on top of the $940 million budget shortfall previously announced.

In response to the projections, the governor's budget office has a contingency plan that requires state agencies to cut their budgets again, this time by $320 million dollars (an additional three percent). This comes on top of the five percent budget cuts announced in July ($800 million dollars of cuts), and the double-digit percentage cuts ($500 million) already implemented when the FY 2010 budget was passed last April.

Also problematic are more than $2 billion in non-recurring revenues in the base of the FY 2010 budget. Unless lawmakers take a more balanced approach to solving this fiscal crisis, an approach that includes revenue options, Georgia will be facing further cuts to vital public services in FY 2011 and 2012, including those to healthcare, public safety, and education.

It is time for Governor Perdue and the General Assembly to bring a balanced approach and transparency to this fiscal crisis. The General Assembly should hold public hearings and learn about the state's revenue outlook from leading economists in the state.

The General Assembly also should hear from state agency staff and citizens about the impact of the budget cuts already in place and the potential impact of planned cuts.

In order for Georgia to prosper, lawmakers must not rely soley on cuts to public services. Georgia can not cut its way to prosperity. The governor and General Assembly must look to raise revenues, as a majority of states have done, including a majority of our conservative southern neighbors. They must take a balanced, informed, and thoughtful approach to solve the state fiscal crisis, and this must include strategic revenue options.

Alan Essig
The Georgia Budget & Policy Institute

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