The First State Bank
Oklahoma City, Okla.
The First State Bank has been using FHLBank Topeka’s Homeownership Set-aside Program (HSP) for many years to help first-time homebuyers in their community realize their dream of homeownership.
“The HSP is huge for us,” said Robert Fightmaster, president of The First State Bank’s mortgage lending area. “It’s a big competitive advantage for our mortgage area. Without the HSP, we wouldn’t have grown as we have.”
The First State Bank uses the HSP to their advantage by starting to market it in early January. Fightmaster sees the grants as a great way to build relationships with local realtors and homebuilders. The $25,000 monthly member limit on HSP funds lends urgency to their marketing efforts by encouraging potential homebuyers to act quickly since The First State Bank (or any FHLBank member) only has access to up to $25,000 per month.
One of the new homeowners The First State Bank secured an HSP grant for last year is a local teacher. “Her parents had offered to help her with the purchase, but she wanted to do it on her own,” Fightmaster recalled. The HSP helped this young professional afford her new home and still have enough of her own money left to purchase furnishings to make it a home.
Last year’s launch of HSP Online made the program more attractive to even a long-time HSP participant, like The First State Bank. “The new system is much faster than before,” said Fightmaster. “The staff in FHLBank’s housing area is also very responsive to our questions.”
Guaranty Bank and Trust Company
Last year was the first time Guaranty Bank and Trust Company used FHLBank Topeka’s Homeownership Set-aside Program (HSP). While many members use the HSP to directly help eligible homebuyers, Guaranty Bank used it to help Habitat for Humanity of Colorado and the community at large.
“All nine of our HSP grants were through a partnership with Habitat for Humanity,” said Lois Croissant, VP at Guaranty Bank in Greeley. “This is just another way our bank can help Habitat and add to our CRA efforts.”
The HSP can be a valuable tool for FHLBank members to receive Community Reinvestment Act consideration by helping with the credit needs in their communities. The HSP grants Guaranty secured helped new Habitat homebuyers throughout Colorado.
Last year’s launch of HSP Online made previous non-users, like Guaranty Bank take notice. “The new system is slick,” said Croissant. “After doing a few grants, I got the hang of the system and it went very smoothly.”
Oklahoma City, Okla.
InterBank of Oklahoma City has a passion for education.
Staff members volunteer in schools throughout Oklahoma and Texas to better the future, one toy at a time.
“We have coloring books and piggy banks and we talk to kids about saving money,” said Banking Officer Paul Navarro, who oversees the institution’s community service efforts. “We’ve had 100% participation (by our branches), and it makes a difference. We’re really reaching the students.”
InterBank’s “How Money Works” program targets first- through third-graders to learn the basics of finance including the functions of a bank, wants vs. needs and how money is made. Other smaller programs for older students focus on advanced concepts like mortgage payments and living on a budget.
While volunteers work with students in the classroom, InterBank is also able to support local schools in a more fiscal manner. Public entities, such as school districts and municipalities, look to InterBank to help protect deposited funds.
It’s a service made easier by InterBank’s partnership with FHLBank Topeka.
“We use FHLBank’s Letters of Credit as collateral for public entities’ deposits,” said InterBank Senior Vice President and CFO Stephanie Craig. “Public entities are comfortable with Letters of Credit for collateral, and it makes it easier to attract new public unit deposits.”
In order to get public entities to the Letters of Credit comfort zone, InterBank took a cue from their own volunteers and went out into the world in the name of financial education. Staff visited public entities in small towns to explain the benefits of Letters of Credit, including the ease, flexibility and absence of necessary monitoring.
The product, Craig said, was an easy sell.
“It’s a Letter of Credit, so public entities don’t have to worry about the value of the collateral going up and down. With securities, you do,” Craig explained. “We don’t have to give them a report every month. They always know how much money they have in the account and that their deposits are covered.”
After a recent overhaul to the system, FHLBank Topeka’s Letters of Credit now have even more benefits to add to the list. The new Letters of Credit are completely electronic, are issued instantly and members like InterBank have on-demand access to documentation online.
“We have been able to give our customers an even quicker turn around then before,” Craig said. “Record keeping is also greatly reduced.”
Armed with a faster system, Craig said her institution aims to expand its public funds business, using Letters of Credit to help bring in new deposits. InterBank has a similar goal in terms of community service, as the company plans to grow its volunteer efforts throughout Oklahoma and Texas schools.
Just like InterBank staff worked closely with public entities to familiarize them with Letters of Credit, InterBank volunteers hope to make kids more comfortable with banks.
“If we can take that intimidation factor out of it, if we can reach these kids when they’re young, they can learn to trust banks and know their money is better off,” Navarro said. “They won’t grow up to be a credit invisible. They’ll be smarter and better about money.”
Aventa Credit Union
Colorado Springs, Colo.
Serving the mortgage lending needs of the nine counties in their market wasn’t possible for Aventa Credit Union before they started using the Mortgage Partnership Finance™ (MPF™) Program.
“The MPF Program puts us on a level playing field with larger credit unions. It lets us act like a larger financial institution and adequately manage our interest rate risk and our members’ credit risk,” said Greg Mills, president and CEO of Aventa Credit Union
Prior to their relationship with FHLBank’s MPF Program, the $170 million credit union could only offer second mortgages and HELOCs. “We were having to turn away our members when they needed a first mortgage,” added Greg.
Aventa, which is headquartered in Colorado Springs, Colo., also serves the Front Range and San Luis Valley. “Participating in the MPF Program allows us to serve our entire market. Selling our conforming loans into the MPF Program frees up our capital to take on nonconforming properties and give our members what they need,” said Sandra Wells, SVP of Lending for Aventa.
Aventa sees several benefits of using the MPF Program, including the added income stream for the Credit Enhancement fee income and retaining the servicing of the mortgages. They also found some less tangible advantages. “FHLBank Topeka offers incredible service,” noted Sandra. “Someone always answers the phone or calls back quickly. FHLBank sees each member as an individual and finds what’s best for their situation.”;
Aventa Credit Union recently was interviewed for a video celebrating the MPF Program’s 20th Anniversary. You can find that video and more about the MPF Program on our website.
“Mortgage Partnership Finance” and “MPF” are registered trademarks of the Federal Home Loan Bank of Chicago.
The first goal was always trust.
It was 2007, and a group of business leaders from Kansas City envisioned a bank built around trust. After raising more than twice the typical capital needed to open a new financial institution, CrossPoint Bank was born.
Ten years later, CrossFirst has been through countless changes – including a new name -- billions in growth and an expansion across multiple Midwest states. But trust remains at its core.
“CrossFirst Bank’s vision is to be the most trusted bank in the five markets it serves,” said Mike Tomandl, Chief Management Accounting Officer. “CrossFirst wants to offer extraordinary service to businesses and professionals and provide competitive returns to its investors.”
To help achieve such aspirations, the Leawood, Kan.,-based institution put their trust in FHLBank Topeka. Becoming a member in 2008, CrossFirst looks to FHLBank as a partner for fixed-rate wholesale funding opportunities.
“We primarily use FHLBank fixed rate bullet advances, but have also utilized amortizing and convertibles as part of our strategic plan,” Tomandl explained. “This type of funding allows us to extend certain assets for income generation and helps mitigate interest rate risk.”
The income generated helped CrossFirst grow its assets to more than $2 billion in its short decade of existence. The growth allowed the bank to expand beyond the boundaries of Kansas City into Wichita, Oklahoma City, Tulsa and most recently Dallas.
CrossFirst has also sought to reach the needs of a growing customer base by offering new products for a wider range of industries. In 2014, they developed an energy lending group and an international banking group to complement their suite of services for business professionals.
And an FHLBank Topeka advance allowed them to serve customers in higher education.
“CrossFirst has utilized a 10-year amortizing advance to match fund a 10-year loan commitment,” Tomandl said. “The loan was used to fund the acquisition of a building for a for-profit college. We still have the advance on our books.”
With a long-term partnership in the works, Tomandl said his bank will continue to trust FHLBank Topeka as a steady source for fixed rate wholesale funding, especially as they aim for further expansion over their next 10 years.
“It’s a very robust growth plan with trust at the center,” Tomandl said. “And FHLBank advances will continue to complement that growth.”
CrossFirst expects to grow at a double-digit rate in each of its five markets, he said. It’s a benchmark the bank will achieve with trust not only as its first goal but as a forever goal for success.