by CBI Lobbyist Jeff Boeyink - Partner, LS2 Group The second week of Session contained very little news regarding forthcoming major initiatives but did see a great deal of activity as subcommittees were meeting at a fever pitch as there is clearly a sense of urgency in the Chambers and in the lobby regarding the need to move quickly. That said, there are two significant issues that will likely be introduced in the next seven to 10 days that will have major implications for the telecommunications and energy sectors in Iowa:
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October Survey Results at a Glance:
OMAHA, Neb. (Oct. 19, 2017) – The Creighton University Rural Mainstreet Index rose from September’s reading, but remained below growth neutral, according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The index, like all indices in the survey, ranges between 0 and 100, increased to 45.3 from 39.6 in September. “As a result of weak farm income and low agriculture commodity prices, approximately 9.5 percent of bank CEOs expect farm loan foreclosures to pose the greatest threat to banking operations over the next five years,” said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business. Farming and Ranching: The farmland and ranchland-price index for October slipped to 39.3 from 39.6 in September. This is the 47th straight month the index has fallen below growth neutral 50.0. Bankers were asked to compare current spot prices for a bushel of corn to break even. Only 2.4 percent of bankers indicated that prices between $3.50 and $3.75 were above break even. Approximately 45.2 percent reported current spot prices were below break even. September Rural Mainstreet Index Reaches 2017 Low: More than Half of Bankers Restructured Farm Loans11/15/2017 September Survey Results at a Glance:
OMAHA, Neb. (Sept. 21, 2017) – The Creighton University Rural Mainstreet Index fell to its lowest level for 2017, and remained below growth neutral for September, according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The index, which ranges between 0 and 100, slumped to 39.6, its lowest level since December 2016, and down from 42.2 in August. “As a result of weak farm income, more than one-half, or 51.2 percent of bankers, reported restructuring farm loans while approximately 18.6 percent indicated their bank had increased collateral requirements. Despite weak farm income bank CEOs reported a low 2.1 percent increase in farm loan defaults, and a 4.1 percent rise in farm loan delinquencies,” said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business. August Survey Results at a Glance:
OMAHA, Neb. (Aug. 17, 2017) – After plummeting in July, the Creighton University Rural Mainstreet Index increased slightly for August, but remained below the 50.0 threshold according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The index, which ranges between 0 and 100, increased to a weak. 42.2 from 40.7 in July which was the index’s lowest level since November of last year. “We continue to record economic weakness stemming from low agriculture commodity prices and fallout from the drought in parts of the region. Approximately 57.6 percent of bankers reported drought conditions were having a negative impact on agriculture production in their area, “said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business. However there was significant variability regarding the impact of weather conditions. Bryan Grove, president of American State Bank in. Grygla, Minnesota, said, “Crop conditions overall in northwest Minnesota are good. Small grain harvest is just starting, with good results both in quality and quantity.” May Survey Results at a Glance:
OMAHA, Neb. (May 18, 2017) – After dropping below growth neutral for 20 straight months, the Creighton University Rural Mainstreet Index moved above the 50.0 threshold for May according to the latest monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The index, which ranges between 0 and 100, climbed to 50.1 from 44.6 in April. May’s reading was the highest recorded reading since July 2015. The last time the overall index was at or above growth neutral was August 2015. “Stabilizing and slightly improving farm commodity prices helped push the overall index into a weak but above growth neutral for May,” said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business. “The U.S. Department of Agriculture is projecting that net U.S. farm income will sink by 8.7 percent to $62.3 billion for 2017, the fourth consecutive year of declines after reaching a record high in 2013. This downward trend has weighted on our survey results for almost two years.” This month, and in May 2016, bank CEOs were asked to name the biggest economic challenge to their banking operations over the next five years. The largest share of bankers, or 28.9 percent, named rising regulatory costs as the top challenge or risk. This is almost the same percent as 2016. More than one in five, or 26.7 percent, detailed government subsidized competition from Farm Credit and credit unions as the greatest challenge, or almost double the 13.6 percent reported in May 2016. April Survey Results at a Glance:
OMAHA, Neb. (April 20, 2017) – The Creighton University Rural Mainstreet Index remained weak with a reading below growth neutral for the 20th straight month, according to the monthly survey of bank CEOs in rural areas of a 10-state region dependent on agriculture and/or energy.
Overall: The index, which ranges between 0 and 100, slipped to 44.6 from 45.3 in March. The last time the overall index was at or above growth neutral was August 2015. “Weak farm commodity prices continue to squeeze Rural Mainstreet economies. Over the last 12 months, livestock commodity prices have tumbled by 5.8 percent and grain commodity prices have slumped by 4.5 percent. The U.S. Department of Agriculture is estimating 2017 will mark the fourth consecutive year that farm income has declined. This downward trend has pushed our survey results into negative territory,” said Ernie Goss, Jack A. MacAllister Chair in Regional Economics at Creighton University's Heider College of Business.
CBI held it's first-ever Legislative Reception at the Iowa Taproom in downtown Des Moines on Wednesday. The reception brought together over 50 Iowa community bankers with over 30 Senators and Congresspeople in Iowa's General Assembly. Among those legislators attending were Speaker of the House Linda Upmeyer, Senate Majority Leader Bill Dix, Senators Michael Breitbach, Randy Feenstra, Tim Kraayenbrink, Tom Shipley, Jack Whitver, Brad Zaun, Charles Schneider, Craig Johnson, Dan Zumbach, Dennis Guth, and Bill Dotzler. Also in attendance were Representatives Brian Best, Chris Hall, Dave Maxwell, David Kerr, Gary Carlson, Jerry Kearns, John Landon, Louie Zumbach, Mike Sexton and Walt Rogers, as well as State Auditor Mary Mosiman. Thank you to the following CBI Endorsed, Associate and Affiliate Members for sponsoring the event: SHAZAM, ICBA Securities/Vining Sparks, United Bankers' Bank, Midwest Independent Bank and Bankers' Bank.
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