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You can take it to the bank: Financial experts say state’s economy is rising, merger mania isn’t over and regulatory laws could take a toll

On Feb. 24, IBJ Publisher Chris Katterjohn, Managing Editor Greg Andrews and banking reporter Matt Kish sat down with four leaders from Indianapolis’ banking and finance sector: Judith Ripley, director of the Indiana Department of Financial Institutions; Kit Stolen, CEO of Union Federal Bank of Indianapolis; Steve Beck, president and CEO of the Indiana Venture Center; and Keith Slifer, senior vice president of LaSalle Bank. Among the topics of conversation: How’s the state’s economy doing? Are more bank mergers on…

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Federal deposit insurance reform beefs up coverage: Retirement savings accounts stand to benefit most

Federal deposit insurance reforms signed into law by President Bush last month boost coverage of some retirement accounts and will raise coverage for other bank accounts beginning in 2010. The legislation, debated by lawmakers for the past six years, is significant because it offers the first increase in deposit insurance coverage in more than 25 years, and just the seventh rise since 1935. Federal deposit insurance currently covers as much as $100,000 per depositor. Starting no later than November, depositors…

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BEHIND THE NEWS: Bank plays the ‘local’ card, but will it succumb to sale?

An in-your-face ad campaign that First Indiana Corp. rolled out last month highlights the Indianapolisbased bank’s local roots and leaves the distinct impression it won’t be accepting a buyout offer anytime soon. Rhetoric or reality? Time will tell. “If you run an Indiana business, you need an Indiana bank,” reads one of the ads. It continues: “Remember when your local bank was actually local?” First Indiana executives and directors are savoring the sale of Union Federal Bank, which leaves First…

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Ayres stores may be razed: Smaller shops likely replacements at Castleton, Greenwood

Simon Property Group Inc. wants to take the wrecking ball to the soon-to-be-vacant L.S. Ayres stores at Castleton Square and Greenwood Park malls, clearing the way for development of a collection of smaller stores and restaurants, sources familiar with the plans say. “There have been numerous site plans circulated showing redevelopment with the existing structures removed,” said Bill French, a local retail broker with St. Louis-based Colliers Turley Martin Tucker. Mark Perlstein, a partner with The Linder Co., an Indianapolis-based…

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Bank profit see-sawed before sale: Union Fed investors may have tired of volatile performance

Union Federal Bank’s profits have gone up and down like an electrocardiogram since a group of elite investors bought a major stake in the privately held institution in 1999. That wildly inconsistent performance likely played a role in the decision by investors to sell the bank, experts say. On Feb. 3, both the bank and its parent company were sold to Bowling Green, Ohio-based Sky Financial Group Inc. for $330 million. The bank had been the thirdlargest in town. After…

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Sarbanes-Oxley spreads beyond public companies: Hospitals, other not-for-profits consider tightening rules

Few topics might kill a cocktail conversation faster than the Sarbanes-Oxley Act, unless the dinner party includes hospital administrators, university presidents or other not-for-profit leaders. A desire to boost credibility-coupled with prodding from bond-rating ratings agencies-has broadened interest in the 4-year-old federal law far beyond the public companies it actually targets. Sarbanes-Oxley-passed by Congress in the wake of high-profile scandals at Enron, WorldCom and elsewhere-was intended to enhance financial disclosure and eliminate arrangements that could undermine the independence of auditors….

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Landing ad revenue: Airport charged up over sponsorship of electrical outlets

Advertisements for mutual funds, watches and kolaches. Now as you wait at the gate for your flight, you’ll even see ads on electrical outlets. The Indianapolis Airport Authority on Jan. 20 was expected to approve a $65,000 marketing partnership with Chase in what is the latest and certainly the most electrifying of all advertising schemes at Indianapolis International Airport. These are desperate times for marketers. Too many ads are getting lost in the shuffle. And barraged consumers have figured out…

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Firm retools after CEO exit: Norwood gives up on sale, to close 2 plants

In recent months, Norwood Promotional Products has settled a lawsuit with its distributors, lost its CEO, put itself up for sale, and then taken itself off the block. Last week, the 2,000-employee company announced plant closings in Iowa and Pennsylvania. The swirl of activity is no cause for concern, according to Norwood officials, who say the No. 2 player in the promotional products industry is doing fine and will stay in Indianapolis. The privately held company-known for making customized products…

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Firm retools after CEO exit: Norwood gives up on sale, to close 2 plants

In recent months, Norwood Promotional Products has settled a lawsuit with its distributors, lost its CEO, put itself up for sale, and then taken itself off the block. Last week, the 2,000-employee company announced plant closings in Iowa and Pennsylvania. The swirl of activity is no cause for concern, according to Norwood officials, who say the No. 2 player in the promotional products industry is doing fine and will stay in Indianapolis. The privately held company-known for making customized products…

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Landing ad revenue: Airport charged up over sponsorship of electrical outlets

Advertisements for mutual funds, watches and kolaches. Now as you wait at the gate for your flight, you’ll even see ads on electrical outlets. The Indianapolis Airport Authority on Jan. 20 was expected to approve a $65,000 marketing partnership with Chase in what is the latest and certainly the most electrifying of all advertising schemes at Indianapolis International Airport. These are desperate times for marketers. Too many ads are getting lost in the shuffle. And barraged consumers have figured out…

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Banking players on rise: Despite flood of mergers, area competition heats up

Big-ticket bank mergers grabbed plenty of headlines in the past two years. Just don’t let the splashy news stories fool you. The number of players in the Indianapolis banking market is expanding, even amid consolidation in the industry nationwide. Over the past 10 years, the number of banks taking deposits in the metropolitan area has grown from 41 to 56, according to annual data from the Federal Deposit Insurance Corp. Analysts attribute much of the growth to smaller banks and…

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Big bank heading for sale?: Union Fed, parent firm mum as talk of mergers intensifies

Officials with the companies in Fort Wayne and here aren’t saying one way or the other. “We have nothing to announce,” said Alvin “Kit” Stolen, CEO of Union Federal since 2002. “We officially wouldn’t comment or address those kinds of rumors or speculation.” The privately held companies are among the largest financial firms headquartered in Indiana. Union Federal has more than $3.4 billion in assets and ranks as the city’s third-largest bank. Waterfield ranked 51st nationwide in mortgage originations in…

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New ATA shares harder to land: Public offering not expected as airline exits bankruptcy

You probably wouldn’t want to buy shares of the first discount airline in recent years to file bankruptcy reorganization-not unless you’re a short-seller or a relative of Norman Vincent Peale. Not in this airline climate. But even they won’t have a chance to buy shares being issued in ATA Holdings Corp. after the Indianapolis airline emerges from Chapter 11 as early as next month. ATA was delisted from Nasdaq shortly after it filed for bankruptcy in October 2004. Old shares…

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Irwin Financial rebounds from loss: Impressive third quarter puts Columbus mortgage lender back on track

The signs were ominous. Profits had turned to losses. Key executives were leaving. Financial statements were being rewritten. In the middle of the turmoil, Columbus, Ind.-based Irwin Financial Corp. pulled an interesting rabbit out of its hat. After posting a second-quarter loss of $3.4 million, Irwin this month surprised Wall Street with an impressive thirdquarter profit of $18.5 million. The $6.5-billion-in-assets financial services company expects similar results this quarter. Company leaders are pointing to a somewhat straightforward fix. “The quarter-over-quarter…

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Omnicity making inroads among the dirt roads: Rural areas served by wireless broadband provider have grown nearly six-fold

An Indianapolis company that provides wireless broadband service from atop grain elevators, water towers or darned near anywhere the warbler roosts is expanding at a rapid clip and plans to launch Internet-based phone service in early 2006. Omnicity Inc. also plans another private offering to raise cash for its ambitious build-out in rural areas that are underserved by high-speed Internet providers. Improving broadband access has economic development implications in Indianapolis’ remote bedroom communities and throughout sparsely populated areas. Now, even…

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Banks embrace checking reprieve: Growing program frees potential customers

Banks and credit unions statewide will soon have a larger pool of customers to tap into when a central Indiana program that helps people barred from opening checking accounts expands. Get Checking, a national program that began at the University of Wisconsin-Milwaukee in 2001, is a way for people who have landed on the ChexSystem register-a list of consumers barred from opening an account-to get off the list. People find themselves in ChexSystem due to bouncing too many checks, failing…

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Somerset enjoying freedom: Firm grew under First Indiana, but independence brings control, president says

Leaders of Somerset CPAs PC are soaking in the single life, one year after they split from First Indiana Corp. Twenty-one Somerset partners bought the assets of the accounting firm from the locally based public company on Oct. 25, 2004, ending a four-year relationship in which bad timing contributed more to the breakup than bad karma. The corporation is the holding company of First Indiana Bank. At a time when the Sarbanes-Oxley Act mandates auditor independence, Somerset President Patrick Early,…

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Public markets are sometimes a double-edged sword: Many companies enjoy access to capital, but others complain regulatory compliance costs are just too high

For young and growing companies, initial public offerings are a bit like climbing a mountain: a long, harsh toil to reach a distant summit. But planting a flag at the peak isn’t enough. To make the journey worthwhile, companies must stay there. The payoff can be enormous, in the form of ready access to capital. But operating at such a high altitude requires careful footing. And the effort costs more than some can afford. “It’s a double-edged sword,” said George…

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BULLS & BEARS: Even after public dissing, analysts still too upbeat

Where can a retail investor go to get accurate recommendations and opinions on a stock? Back in the old, old days, an investor would call a stockbroker, also called a “customer’s man,” and get a copy of a research report. Only good clients could get the research reports so there was an air of exclusivity about them. Or if an investor were really diligent, he could go to the public library and leaf through the super-thin pages of the giant…

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Texas group roaring for Indians stock: Lion Fund dangles 40-percent premium for ballclub’s shares

A San Antonio-based hedge fund’s public solicitation of Indianapolis Indians stock is akin to a hostile takeover attempt, industry observers said. It also brings into question the succession plan of the Indians’ 72-year-old chairman, Max Schumacher, who owns 39 percent of the company’s stock. While officials for The Lion Fund LP said they aren’t looking to take majority control of the city’s AAA baseball franchise, they’re willing to pay a substantial premium over the Indians’ last buyback offer of $9,200…

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