Excerpt From Levick’s High Stakes Newsletter October 2009

Industry insight: Karen Tyson, Senior Vice President for Communications of the Independent Community Bankers of America
As Senior Vice President for Communications of the Independent Community Bankers of America, Karen Tyson has been at the center of solving the greatest reputational challenges facing America’s more than 8,000 community banks since the first signs of financial crisis emerged. As a communications professional that has been on the front lines of one of the most intensely-scrutinized business issues of the day, she shared her insights on the community banking landscape with High Stakes™:

How have community banks gone about the task of regaining public trust in the wake of global financial crisis? In your estimation, have their efforts been successful? How must those efforts evolve in the coming months?

Karen Tyson: At the outset of the current financial crisis, one of the greatest concerns facing community banks was to avoid being painted with the same brush that tarred the bad actors. So, from day one, our job at ICBA has been to differentiate community banks from the institutions whose practices led most directly to the economic turmoil we’ve seen over the last 18 months.

In our public statements, we’ve highlighted community banks’ risk-averse nature, that they are strong, safe and stable, and the fact that they are committed to “common sense relationship lending.” Those messages have been echoed by many of our member institutions – and in some pretty creative ways, as evidenced by the community banks that have held town-hall meetings to assuage consumer anxiety within their communities and spread the message that community banks aren’t to blame for current economic conditions.

I don’t think there’s much doubt that those efforts have been successful — we’ve garnered significant positive media coverage for community banks. Now that significant progress has been made in articulating that community banks weren’t the problem, our focus is to ensure they continue to be well-regarded and have the ability to continue to serve a significant role in our nation’s economic recovery.

Of all the myriad audiences that community banks must address in the coming months, which are most vital to the industry’s reputational goals?

Karen Tyson: It’s consumers that drive this industry, so as always, they need to know that their community banks are there to meet their financial needs and goals – just like they’ve always been.

In the current environment, Congress and regulators remain an audience that is vital to the industry’s interests. While community banks have recently won some important legislative victories – and many policymakers sing community banks’ praises – there are still aspects of an impending regulatory overhaul that could place an undue and unnecessary additional compliance burden on community banks for a problem they didn’t cause. We must continue to stress the value of community banks to their communities’ recovery efforts and the continuing vitality of our national economy as a whole.

What’s next for community bankers? Are there issues emerging on the horizon that the industry needs to be aware of?

Karen Tyson: It’s hard to look too far ahead when you’re facing what could be historic change to an industry. Everyone is focused on the problems at hand – namely, ensuring that new regulations don’t adversely affect community banks and their customers.

I will say, that community banks are extremely optimistic about the future – and they have good reason to be. The general public is distrustful of the large players in the financial services marketplace. This already has and should continue to open up a great deal of opportunity for community banks who build their reputations on trust and strong personal relationships.