The Community Bankers Association of Georgia (CBA) has announced the four winners of the Annual Julian & Jan Hester Memorial Scholarship. Winners will receive a $1,000 scholarship to attend a Georgia college or university. Applications were submitted to the Association through a CBA member community bank. Congratulations to the following winners: Audrey Dugan, Greensboro, sponsored by Farmers & Merchants Bank, Eatonton; Carmina Escalante, Athens, sponsored by First American Bank & Trust, Athens; Irian Gonzalez, sponsored by Community Bank of the South, Smyrna; and John Reddaway, Suwanee, sponsored by Quantum National Bank, Suwanee. CBA would also like to give a huge thanks to the judges of this year's scholarship: Taryn Fox, Consolidated Banking Services, Inc., Cumming; Leslie Hammond, Community & Southern Bank, Marietta; Katherine Kay, Georgia Commerce Bank, Atlanta; Francesca Peri Kohler, First Data Corporation, Atlanta; and Don Sabbarese, Kennesaw State University. As part of the scholarship, CBA asked Georgia's next generation two questions: Why is community banking important and what does community banking mean to their local community? Listed below are the winning essays of the 2011 Julian & Jan Hester Memorial Scholarship: Audrey Dugan Community banking is an extremely important part of anyone's life, especially those living in a small town.  While larger conglomerate banks may have a few different packages and perks, no nationwide bank can offer the service and personal touch of a local branch.  Community banks are always well-known in the town in which they preside.  Their advertising and man-power can usually not be superseded.  Community banks are basically the heartbeat of any town as they make people's goals come to life, as well as helping those realize when a dream cannot become a reality.  Without the personal approach and knowing decisions of local bankers, the economy would be in even more dire straights. I personally have seen the differences between the routine methods of larger banks and the personalized protocol of local banks. The smaller, more intimate settings allow for better, less risky, and more beneficial transactions.  Having face-to-face interaction with the same loan officer each and every time you go into your bank allows you to become familiar with them, as they do with you.  A banker is more likely to give a loan to a person with plausible ideas who they have seen succeed in the community and have helped it grow and flourish.  Without this personal interaction, how could a bank truly know how well a person will do with the sums of money they are allowing them to borrow? Community banking allows for review of character, not just credit scores and previous transactions. Next year, as I go off to college, I am going to have the most trouble acclimating to the impersonal feel of things in a big city, especially in banking and school.  Hopefully, my service on the Junior Board of Directors at Farmers & Merchants Bank and my familiarity with small town and community banking will allow me to help these same types of small businesses after college; whether it be my current town and community or a whole new dynamic. Sponsored by: Farmers & Merchants Bank, Eatonton Locations Downtown Eatonton 100 South Madison Avenue Eatonton, GA 31024 Phone (706) 485-9941 Lake Oconee Branch 1011 Lake Oconee Parkway Eatonton, GA 31024 Phone (706) 485-9858 Carmina Angelica Mirandilla Escalante When my father joined the University of Georgia as a faculty member in January 2001, one of the first industry professionals he worked with as part of his outreach work was Mr. Julian Hester, who was then President of the Community Bankers Association of Georgia.  My father recalled his collaboration with Mr. Hester on the implications for community banks of the revision of Article 9 of the Universal Commercial Code (UCC).  UCC is a "comprehensive code addressing most aspects of commercial loans," including the operations of banking businesses all over the country (Leong, Duke School of Law, 2010). For sure, the UCC Article 9 issue was just one of the many efforts of Mr. Hester in promoting the community banking industry in Georgia.  The results of such efforts cannot be underestimated as community banking plays an important role in the economic development of local communities. The ongoing economic recession can actually teach us important lessons on banking business survival and the importance of community banks. As analysts point out, many banks failed in recent years because they made bad credit decisions, especially lending heavily to the faltering real estate industry. In making loan decisions, banks must carefully assess their borrower's repayment capability.  Large commercial banks usually depend mostly on sophisticated computer programs and models in determining their borrower's credit-worthiness. But, community banks operate differently.  These banks operate in communities where as the "Cheers" jingle would say, "everybody knows your name." Their loan officers are very familiar with their local clients' business and personal conditions.  Such intimate, personal details cannot be captured by the computer programs that large banks use.  Community bank loan offers use such information to supplement credit models' assessments when they make approval decisions. The more personal lender-borrower relationships there are in community banking, actually translates into an advantage for the borrower.  Small businesses in local communities usually do not stand a chance to get their loan applications approved by large banks because these banks' credit models rate them very poorly. The borrowers' interaction with the big banks' lending officers is usually too impersonal or very business-like.  The extra "personal knowledge" of the borrowers' actual conditions that could have helped their loan applications is not at all considered.  Hence, potentially deserving borrowers end up getting loan rejections from large banks. We cannot underestimate the effects of the absence of credit.  Without credit, a business can struggle as its business plans maybe put on hold, if not discarded completely.  When business activity is restricted, the local community's economic development is also affected adversely, through loss or non-creation of jobs, incomes, and economic opportunities within the community. In essence, community banks actually function as agents of progress that stimulate economic activity in their communities.  We may be all treading through some tough times, nowadays, but with trust based on familiarity and more productive banking relationships, community banking can lead the way to full economic recovery - just as Mr. Hester himself had envisioned in his lifetime. Sponsored by: First American Bank & Trust, Athens Main Office 300 College Avenue Athens, GA 30601 Phone (706) 354-5000 Kroger - College Station Branch 2301 College Station Road Athens GA 30605 Phone (706) 354-5071 West Broad Branch 2241 West Broad Street Athens, GA 30606 Phone (706) 354-5050 Winder Branch 65 E. May Street Winder, GA 30680 Phone (770) 307-1212 Highway 29 North Branch 825 Hull Road Athens, GA 30601 Phone (706) 354-5060 El Banco de la Oportunidad Our Fully Bi-Lingual Branch - English and Spanish 995 Hawthorne Avenue Athens GA 30606 Phone (706) 354-5090 Watkinsville Branch 1681 Experiment Station Road Watkinsville, GA 30677 Phone (706) 354-5043 Irian Gonzalez It is interesting to note that 97% of all banks in the United States are community banks.  Despite the fact that these banks have a smaller share of assets, they offer many benefits that make them competitive in a world that multi-state institutions dominate.  Their greatest aspect is perhaps their humanity, their focus on and care for small businesses, their owners, and of course, the local community. My local community bank is Community Bank of the South. It was established in 1999 by local businessmen and bankers who were unhappy with the regulations and service of larger banks. The bank's motto is "local people, local decisions," and they do a lot to uphold this.  At Community Bank of the South, the customer is familiar with the staff and is certainly more than just a number.  Calling in, the customer is always greeted by a friendly receptionist, not a recording.  In large banks it can be next to impossible to speak to the bank's president. At Community Bank of the South, the President, Mr. Lee Scroggins, Jr. is much more accessible. He is always at the bank, not in an office in another state, and he even eats peanuts with the customers in the lobby from time to time. The Community Bank of the South takes its customers seriously and sincerely cares for the community of Smyrna. They are partners with the Smyrna Business Association and the Cobb Chamber of Commerce. In order to keep the community informed, they offer programs like "Safe and Savvy," a seminar on protection against identity theft and scams, and "Money Smart," sponsored by the FDIC. The bank is also involved in the Jonquil Jog held by the City of Smyrna and in local networking. Internally, the bank also works to ensure the highest quality of service. In this respect, the Community Bank of the South distinguishes itself from other banking institutions. The bank has four branches, all of which are in Cobb County. This means that all information remains local and approval decisions are made much more quickly than with large banks that often send information to other states for approval. The proximity of a community bank and its involvement in the community also allows it to consider character in approval decisions, whereas larger banks have more impersonal criteria. Accounts are tailored to the specific needs of customers more readily at community banks. Fortunately, for those seeking a bank that will cater to their needs with competitive interest rates on loans and CDs, anyone can open an account with Community Bank of the South. There is no affiliation necessary as with credit unions and the customer can be sure to receive personalized care by one of many bank representatives. This is why the Community Bank of the South handles more than nine-thousand accounts and continues to grow. Sponsored by: Community Bank of the South, Smyrna Main Office 3016 Atlanta Road Smyrna, GA 30080 Phone (770) 436-4567 Dallas Highway 3596 Dallas Highway Marietta, GA 30064 Phone (770) 419-3125 Canton Road 3324 Canton Road Marietta, GA 30066 Phone (678) 594-7300 Johnson Ferry Road 3140 Johnson Ferry Road Marietta, GA 30062 Phone (770) 650-6500 John David "J.D." Reddaway This year, I am taking AP Microeconomics and AP Macroeconomics, and in both classes the topic of banking has been a point of discussion. From what I have gathered through talks with my father and with my teacher, as well as by listening to Clark Howard on the radio, community banks offer things that monster-mega banks simply cannot. The pros of community banks stem from the fact that they are small scale and local. There is one thing that monster-mega banks cannot offer, but community banks can: a relationship. Community banks deal with faces - not just numbers. This means that community banks try to help their customers in order to maintain a good relationship. Having a relationship with a bank also means that the bank will make quick financial decisions so the consumer does not have to wait too long in order to get a loan. For monster-mega banks, getting a loan can take up to four weeks! Another benefit of banking with a community bank is the better stability and security. Because of their small scale, community banks can hire on an experienced and well-trained management team that will understand the challenges faced by their customers. This team is highly trained in banking, law, and accounting, will make smart and safe decisions. Anyone who banks with a community bank can have the peace of mind that they are in safe hands. Community banks are also great because they are active in the community. They donate time and money to local schools and non-profit organizations. The staff of community banks are also involved in the community. A town that does not have a community bank is really missing out. Monster-mega banks fail because they lack the comfortable local feel and close relationships between the bank and customer that community banks include. With community banks, customers feel safe in the hands of an experienced management team. In addition, community banks are active in supporting their communities. Sponsored by: Quantum National Bank, Suwanee Suwanee/Main Office 505 Peachtree Industrial Blvd. Suwanee, GA 30024 Phone: (770) 945-8300 Milton Office 2905 Bethany Bend Milton, GA 30004 Phone: (678) 889-4700