John Howell Sr.

The waves of financial uncertainty sweeping over Wall Street this week following Monday’s defeat of the federal bailout bill had been reduced to ripples by the time they reached Panola County, local bankers said this week.

The bankers point to accounts insured by the Federal Deposit Insurance Corporation (FDIC) and to conservative lending practices.

“There’s never been anybody that lost a dime in an FDIC-insured account,” First Security Bank CEO Frank West said.

Customers at BancorpSouth and Covenant Bank are borrowing money for cars, real estate and to operate small businesses much the same as they were this time last year, local managers, respectively, John Rigdon and John Burchfield said.

“The price of our stock is higher than it was this time a year ago,” Rigdon said, citing Bancorpsouth’s recent high of almost $32 a share.

Panola bankers’ comments reflected similarities to national reports about the nation’s banking industry: local and regional banks have operated more conservatively and avoided risky lending practices, especially sub-prime lending.

“(In) Community banking and here in Batesville, we haven’t been as subject to real estate price drops,” said Regions Bank’s David Smith, citing examples of drastic decreases in property values that have hammered lenders on both U. S. coasts.

Guaranty Bank President David Morgan said that he has noticed little decrease in real estate values locally. Morgan also reported business as usual at his facility and said that Guaranty will build an additional branch in Batesville next year.

“If they (loan applicants) qualify, they qualify and we make the loan,” said Morgan.

“Basically we don’t make 30 year mortgages and hold them on the books,” West said. First Security sells its long-term loans to mortgage companies, he continued. “We don’t do any subprime.”

“By regulatory standards, Renasant Bank is a ‘well capitalized’ bank and we anticipate business as usual for our traditional banking services,” said its community president, Calvin Flint.

The FDIC, an independent agency of the U. S. government created in 1933, presently insures bank deposit accounts up to $100,000. Different categories of account ownership can qualify for higher coverage. Discussion of the bailout proposal in Washington includes raising the limit on deposit amounts covered.

At least one Batesville banking institution offers a program that can insure accounts up to $30 million. Burchfield said the Covenant Bank’s membership in the Certificate of Deposit Account Registry System (CDARS) is “similar to a brokered CD.” A deposit exceeding $100,000 is placed into multiple certificates of deposits issued by banks in the CDARS network in increments of less than $100,000 to keep principal and interest eligible for FDIC coverage, according to cdars.com.