Money Talk: MNB opens two new bank locations

Editor’s note: Each Monday, Talk Business & Politics provides “Money Talk,” a wrap-up of banking and financial news.

MNB OPENS TWO NEW CENTRAL ARKANSAS LOCATIONS: Malvern-based MNB has opened two new branches in central Arkansas with a new location at Gateway Town Center near Bass Pro Shop and a Conway branch. The two new offices complement a recently renovated location in the Little Rock Heights and a loan production office in west Little Rock. In total, MNB has 14 branches in six counties in Arkansas.

Regional President John Fowler will be responsible for both markets with the help of Andy Harris as President of the Conway market. “What has always set apart MNB is what we call our ‘hometown feel’ along with our strong, solid financial footing,” Fowler said in a press release.

MNB has more than $400 million in assets and employs approximately 120 people. It first opened for business in 1934 and serves customers in Hot Spring, Faulkner, Garland, Saline, Grant and Pulaski counties.

MORTGAGE DENIAL RATES DOWN, ESPECIALLY AMONG BLACK BORROWERS: The percentage of U.S. mortgage applicants getting approved has increased, especially among middle-income black and Hispanic loan applicants, indicating that easing mortgage restrictions are making it easier for more Americans to become homeowners.

Despite that progress, black and Hispanic homeowners still lag behind whites and Asians in the housing recovery, according to the latest Zillow analysis of mortgage access and homeownership by race. In 2014, blacks made up 12% of the U.S. population, but only three percent of conventional loan applicants. They made up only 2.5% of those approved for a conventional loan.

Hispanics make up 17.3% of the U.S. population, but represent only 6.1% of applicants and 5.5% of approved applicants for conventional loans. Whites, on the other hand, make up 62% of the population, but 69.5% of conventional loan applicants and 71.9% of those approved for conventional loans.

FDIC: U.S. CREDIT RISK REMAINS AT HIGH LEVEL – Credit risk in the Shared National Credit (SNC) portfolio remained at a high level, according to an annual review of large shared credits released last week by federal banking agencies. The SNC review has been conducted by the Board of Governors of the Federal Reserve System (Federal Reserve), the Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC) since 1977 to assess risk in the largest and most complex credits shared by multiple financial institutions.

This year’s review found that banks are making progress in aligning their underwriting practices with the leveraged lending guidance issued by regulators in 2013. However, the review highlighted continuing gaps between industry practices and the expectations for safe and sound banking. Leveraged transactions originated within the past year continued to exhibit structures that were cited as weak by examiners. The persistent structural deficiencies found in loan underwriting by the agencies warrant continued attention.

The review also noted an increase in weakness among credits related to oil and gas exploration, production, and energy services following the decline in energy prices since mid-2014. Aggressive acquisition and exploration strategies from 2010 through 2014 led to increases in leverage, making many borrowers more susceptible to a protracted decline in commodity prices. Oil and gas commitments to the exploration and production sector and the services sector totaled $276.5 billion, or 7.1%, of the SNC portfolio. To view the 2015 review, click here.

ARKANSAS BAR ASSOCIATION SELECTS STEPHENS INSURANCE TO OVERSEE INSURANCE, EMPLOYEE BENEFITS PRODUCT LINE: The Arkansas Bar Association (ABA) has named Stephens Insurance, LLC as its exclusive endorsed insurance broker overseeing Lawyers Professional Liability (LPL) insurance as well as other property, casualty, life and health benefits to its more than 5,000 members. Through its Stephens’ services, Arkansas Bar Association members will have access to affordable products and tailored services that help protect against liability exposures unique to attorneys. Stephens Insurance is one of the largest privately owned insurance brokerages in the Mid-South. The insurance arm of Little Rock investment and banking firm Stephens Inc., has more than 150 employees in Fayetteville, Jonesboro, Dallas, Austin, Jackson, and most recently Houston.

MOST AMERICANS THINK MIDDLE CLASS WEAKER THAN IN THE PAST: Americans view a strong middle class as vital to the country’s well-being, however, most are concerned that the state of the middle class has weakened, reflecting a new reality of financial volatility for many across the nation, according to a new study of 1,000 American adults by credit solutions firm Elevate.

A significant majority (88%) of those surveyed believe that a strong middle class is important to the U.S. economy and three-quarters (76%) of respondents identified as middle class. While most consider themselves to fall within the middle class, 80% say it is harder to be middle class today than it was 25 years ago and 71% believe the middle class is weaker today than it was in the past.