FSG CEO Says Banks More Important Now Than Ever

Saturday, December 7, 2013
Michael Kramer
Michael Kramer

FSG Bank CEO Michael Kramer told members of the Civitan Club on Friday that banks are more important today than ever - now that many other type lenders have gone away.

"Most non-bank lenders are gone," he told club members at the luncheon at the Bessie Smith Hall.

As a result, he said there is fierce competition between community banks to lock down new loan accounts.

:"I have never seen the lending market so competitive," he said.

Mr. Kramer said he may "give" in negotiations with potential borrowers on rate, "but not on credit."

He said one sour $250,000 loan can have a significant effect on the bank's bottom line.

Coming to FSG Bank in December 2011, he said the bank had accumulated a huge amount of bad loans. Writing them down cost bank shareholders millions of dollars, he said.   

Mr. Kramer said when the reserve ratio of a bank drops as low as two percent, it is in danger of being taken over by regulators. He said FSG got that low at one point, but, with an infusion of cash from new investors, is up to an 8.4 percent ratio.

He said bank "branches" are not so important in the age where many do their banking online and never visit a bank of any type.

Mr. Kramer said a bank now considering a new branch would go for one with about 1,500 square feet and three drive-thru lanes. Years ago, he said the bank would have been designing a branch with 4,000 square feet.

He said banks are scrutinizing loans much more carefully, but he said the cartoon showing the banker requiring a 300 percent down payment is not accurate. In fact, he said he worries that banks are again becoming too lax in credit checks, which he said could lead to new problems.

Mr. Kramer said the Small Business Administration has improved in recent years and it now operates closer to a business. He said many banks partner with the SBA and with the USDA.

He said, contrary to media reports, the federal government and taxpayers did not get soaked under the TARP program in which there were major cash infusions to troubled banks. He said the government wound up with a tidy profit. 


Drunk Driving Charge Reinstated By State Supreme Court After Finding That Police Acted Reasonably

The Tennessee Supreme Court has reinstated charges of driving under the influence and violating the open container law against Williamson County resident Mechelle Montgomery in an opinion that restores evidence gained during a search. In February of 2012, two officers with the Williamson County Sheriff’s Office were dispatched to the residence of a woman named Corey Brown, who ... (click for more)

State Supreme Court Rules That Employee Does Not Qualify As Whistleblower

The Tennessee Supreme Court has affirmed the dismissal of a whistleblower claim by Charles Haynes, a former employee of Formac Stables, Inc., in Obion County. Mr. Haynes worked as a groom at Formac Stables. In April of 2010, hesuffered an injury to the head when kicked by a Tennessee Walking Horse named “Bruce Pearl.” Mr. Haynes claimed that Formac’s owner refused to allow him ... (click for more)

Hard Freeze Predicted In The Area For Saturday Night

Temperatures are expected to drop Saturday night to 28 degrees or less. Here is the latest report from the National Weather Service:  HARD FREEZE WARNING REMAINS IN EFFECT FROM MIDNIGHT EDT /11 PM CDT/ TONIGHT TO 11 AM EDT /10 AM CDT/ SUNDAY... * EVENT... A HARD FREEZE EXPECTED WITH LOWS FROM THE TEENS NORTH TO THE UPPER 20S SOUTH LATE TONIGHT AND SUNDAY MORNING. ... (click for more)

Man Charged In Shooting On Sixth Avenue Had Been Shot Himself Last Week; Police Say Incident "Part Of Gang War"

A man charged with attempted first-degree murder on Sixth Avenue Court on Thursday afternoon was shot himself earlier this month. O'Shae Kadaris Smith, 20, of 2114 E. 12th St., is also charged with reckless endangerment, aggravated assault and possessing a firearm during the commission of a crime. He was one of two people shot on Rawlings Street on March 16. Kendre Allen, ... (click for more)

Finley Stadium Needs To Grow Up - And Response

RE:  Finley Stadium Financial Picture Rosy; Beer And Alcohol Sales Approved; AstroTurf Almost Ready and City, County Pitching In $250,000 Each For New Finley Stadium AstroTurf I read a story here five days ago about a rosy future for Finley stadium. It lead me to believe that the stadium was making money and even improvements with donations.  Then we get a short ... (click for more)

Roy Exum: The Sunday Funnies

They say March roars in like a lion and leaves like a lamb. So as you reach for your lambs-wool sweater on this last Sunday of the month, allow me to lighten up a bit with a new edition of my Sunday Funnies. I have a delightful crowd that keeps me supplied in jokes and these are some of the best that have come my way: A WOMAN'S PERFECT BREAKFAST -- She's sitting at the table ... (click for more)