About Balance Sheet Management Services Balance Sheet Management Services (BSMS) has provided ALM analytics, financial reporting and regulatory consulting services to institutions nationwide since 2000. Our goal is simple to provide clients the insight they need to better manage their institution. ASSET LIABILITY MANAGEMENT ALM, Regulatory and Investment Accounting With one of the most comprehensive ALM models in the industry, Balance Sheet Management Services can equip your institution with the tools needed to thoroughly evaluate the risk exposure and liquidity levels on its balance sheet. In addition to the ALM documents, institutions receive customized support and strategic insight from a seasoned team of industry professionals. We will discuss your results, identify opportunities and recommend solutions to help meet your strategic goals. Get More from Your ALM Quarterly reports with financial and analytic support NEV/EVE and NII analyses with eight rate-shocked scenarios Core deposit study updated quarterly Non-maturity deposit sensitivity analysis using varied assumptions Liquidity and funding risk analysis with cash flow forecast Annual Understanding Your Assumptions document Balance sheet overview, including concentrations risk calculations Capital utilization analysis, including asset growth risk Investment portfolio analysis Additional what if reporting available ALM + Regulatory Support Our ALM services can be enhanced with regulatory coverage plans in which our former examiners can review an institution s ALM analytics to identify potential red flags in the balance sheet. ALM Regulatory Confidence Our Regulatory Packages Include: One-page ALCO summary report includes recommended risk limits and policy guidelines using client-specific balance sheet and risk profile data. Board support 30-minute ALCO agenda. Review and maintenance of ALM-related policies ALM/IRR, investment, concentration risk, loan participation and liquidity management/contingency funding, with scenario stress test. Advice on ALM-related exam concerns. Series of regulatory consultations to troubleshoot prospective balance sheet and policy concerns. www.bsmservices.com 800.645.5424
ALM, Regulatory and Investment Accounting REGULATORY SUPPORT The Office of Regulatory Affairs is comprised of former examiners from the National Credit Union Administration (NCUA) and the Office of the Comptroller of the Currency (OCC). Helping institutions address their ALM-related regulatory needs, they provide policy development and maintenance, examination support, and board and ALCO assistance. They also issue regulatory updates and conduct educational webinars. Policy Development Investment policy Liquidity management policy Contingency funding plan ALM/Interest rate risk policy Concentration risk policy Loan participation policy Exam Support Former examiners on staff Pre-examination coaching ALM Assessment Examination concern resolution and appeal Board and ALCO One-page risk management report ALCO creation/restructuring Virtual presentations Education and training INVESTMENT ACCOUNTING From simple inventories of CDs to diversified portfolios of complex investment assets, we offer investment portfolio accounting services for institutional fixed income investors. More than 50 easy-to-read reports Independent third-party pricing ASC 320 accounting Yield calculations To learn how Balance Sheet Management Services can help your business, please contact us at 800.645.5424 or info@bsmservices.com. The information in this document has been obtained from sources we believe to be reliable. However, we do not guarantee it is accurate or complete. This information is subject to change without notice. This is not and should not be construed as an offer or solicitation to buy or sell any security or securities. Balance Sheet Management consultants, including any reports, policy recommendations or sample policy language should not be considered legal, investment or tax advice. www.bsmservices.com 800.645.5424 6.16
E. Prescott Ford, CFA Managing Director - Office of Regulatory Affairs Prescott Ford is the Managing Director of the Office of Regulatory Affairs at Balance Sheet Management Services (BSMS), and is formerly a National Bank Examiner with the Office of the Comptroller of the Currency. He draws on more than 20 years of experience in the regulatory/compliance examination sector to keep banks and credit unions in step with a constantly changing regulatory landscape. Prescott conducts comprehensive reviews of institutions policies pertaining to their interest rate risk, investment practices, concentration risk, liquidity risk management, contingency funding plans and asset liability management. As a trusted consultant, he works with clients through all stages of the regulatory examination process, advising on pre-examination issues, concern resolution and appeals. He also advises clients in establishing risk limits, loan participation policies and other asset liability management needs. Prescott provides regulatory updates and conducts educational webinars and seminars. He also recently authored the Credit Union Times article Management Manages, Not the Examiner. Prescott was a commissioned National Bank Examiner with the Office of the Comptroller of the Currency (OCC) for 13 years stationed in Ohio and New York. In this capacity, he performed capital markets, retail credit, mortgage banking and other examinations at banks in all four OCC districts across the United States and abroad. Having worked with institutions of all sizes, he developed a strong understanding of the myriad issues that these institutions and their senior management face. Prescott was awarded recognition on seven occasions by four Assistant and Deputy Comptrollers at the OCC, and was the recipient of the Special Service Award for excellence in bank supervision. Prescott applied his experience as a regulator to develop the global compliance examination function at Fitch Ratings. During his tenure with the company, Prescott was instrumental in creating and designing the group s mission statement, strategic plan, policy and procedures manual, as well as a quantitative risk assessment model. He was involved in managing multiple concurrent compliance examination activities, as well as communicating observations and recommendations to all levels of management, members of the Board, and the U.S. Securities Exchange Commission (SEC). Prescott received a Bachelors of Science in Business Administration, with a concentration in Finance from The Ohio State University. He has been a Charted Financial Analyst (CFA) charter holder since 2004, and a member of the New York Society of Security Analysts (NYSSA). 100 Motor Parkway, 2nd Floor l Hauppauge l NY l 11788 l Toll Free: 800.645.5424 l Tel: 631.979.0097 l Fax: 631.979.6036 www.bsmservices.com l clientrelations@1empire.com
Charles H. Felker Managing Director - Office of Regulatory Affairs Charles H. Felker is the Managing Director of the Office of Regulatory Affairs at Balance Sheet Management Services, and is the former Chief Investment Officer of the National Credit Union Administration. He provides guidance to clients navigating today s rapidly changing regulatory environment. Mr. Felker joined the National Credit Union Administration (NCUA) in 1971 as a Federal Credit Union Examiner in Region I, continuing in that position until 1974 when he joined the staff of the New York State Credit Union League. At the New York State Credit Union League, Mr. Felker held the positions of Senior Field Consultant and Director of Member Services before returning to NCUA s Region I in 1977. As a federal credit union examiner and as a member of the New York State Credit Union League staff, Mr. Felker organized and chartered 10 federal credit unions, including Empire Corporate Federal Credit Union. Between 1977 and 1986, Mr. Felker served NCUA s Region I as Director of Consumer Affairs, Director of Chartering and Insurance, and as a Supervisory Examiner. In 1986, Mr. Felker transferred to NCUA s Washington Office as the Risk Analysis Officer in the Office of Examination and Insurance. In 1988, Mr. Felker was named to the position of NCUA Senior Investment Officer. As Senior Investment Officer, Mr. Felker monitored the investment markets, and provided information to examiners, credit union officials, and securities dealers relative to the various investment instruments authorized by the Federal Credit Union Act and the NCUA Rules and Regulations. Mr. Felker also served as NCUA s representative to the Federal Financial Institution Examination Council s (FFIEC) Investment Task Force, and was the principal author of NCUA s investment regulation for natural person credit unions. Mr. Felker was also the principal author of several NCUA Interpretive Ruling and Policy Statements addressing investments and balance sheet risk management practices. Mr. Felker has made numerous presentations before trade and regulatory groups throughout the United States and Canada, including the following: National Credit Union Administration, Federal Reserve Bank of Atlanta, Federal Reserve Bank of Dallas, Federal Reserve Bank of Kansas City, Federal Reserve Bank of New York, Federal Reserve System, Washington, D.C., Florida Credit Union League, CUES CEO Network, Michigan Credit Union League, CUES National Director s Conference, Defense Credit Union Council, Credit Union League of MA. Mr. Felker is a 1971 graduate of Husson College (Bangor, Maine) where he earned a Bachelor of Science in Accounting and Business Administration. Mr. Felker also holds an LLB degree, and has attended the New York Institute of Finance where he studied many of the investment products available to financial institutions. 100 Motor Parkway, 2nd Floor l Hauppauge l NY l 11788 l Toll Free: 800.645.5424 l Tel: 631.979.0097 l Fax: 631.979.6036 www.bsmservices.com l regulatoryaffairs@bsmservices.com
Frank A. Santucci Managing Director Frank Santucci is the Managing Director of Balance Sheet Management Services (BSMS), and is an authority on issues related to asset liability management in the institutional fixed income market. He provides balance sheet and portfolio intelligence to institutions related to their policies, investment objectives and regulatory responsibilities. Frank is the principal author of Balance Sheet Management s ALM model, a comprehensive and costeffective service that measures and monitors risk related to earnings, liquidity, capital and interest rates. The user-friendly ALM product has become instrumental for many institutions in the active management of their balance sheets. Prior to the founding of Balance Sheet Management, he assisted hundreds of institutional investors to purchase and sell fixed-income securities while serving as an account executive at BSMS affiliate, First Empire Securities. He also served as an account executive for the California-based Guardian Financial Group, a financial services company specializing in investments and insurance products for institutional investors. As an account executive, Frank was responsible for the analysis of qualified pension, profit sharing, and retirement plans, and the sale of group annuities, investment funds, and Guaranteed Investment Contracts to the qualified plans of Fortune 500 Companies. Frank pursued his higher education at Long Beach City College and at California State University of Long Beach in Long Beach, California. Frank currently holds Series 7, 63, and 24 licenses from the Financial Industry Regulatory Authority. Frank is also an Eagle Scout with the Boy Scouts of America. 100 Motor Parkway, 2nd Floor l Hauppauge l NY l 11788 l Toll Free: 800.645.5424 l Tel: 631.979.0097 l Fax: 631.979.6036 www.bsmservices.com l info@bsmservices.com
Notice of Privacy Policies We value our relationships with our customers and are dedicated to providing them with exceptional products and services. As part of our dedication to servicing their financial needs, Balance Sheet Management Services, Inc. ( BSMS ) is committed to protecting the confidentiality of non-public personal information about our customers. This privacy notice is to inform our customers about the types of information that is obtained from customers, how that information is used, and the measures taken to protect that information. Information Obtained From Customers In order to provide services to each customer, BSMS requests the customer to provide certain personal non-public information, including, but not limited to current investments, investment history and objectives, and other non-public information that will assist us in performing our services. How Information is Protected BSMS restricts access to non-public personal information to those employees who need to know that information to provide products or services to our customers. We maintain physical, electronic and procedural safeguards that comply with federal and state regulations to guard such information. Disclosure We do not disclose any non-public personal information about our customers or former customers to anyone except as permitted by law. Non-public personal information as outlined above will only be disclosed for such purposes as conducting and auditing our business, administering the business of affiliated organizations, responding to requests from government authorities or regulatory bodies, or as authorized or requested by our customers. Such disclosures include, but are not limited to: Affiliates We may provide information to affiliated companies to enable them to provide business services. Agents We may provide information to enable agents to offer and provide our products and services to our customers. Government Authorities and Regulatory Bodies We may provide information upon request from governmental authorities or regulatory bodies for the purpose of preventing fraud, auditing our business, or other reason for which the entity is legally permitted to request information. We do not share, trade, sell, exchange or disclose non-public personal information except as stated above or to otherwise service our customers accounts. It is our policy not to disclose any non-public personal information to non-affiliates other than service providers and third parties that aid in fulfilling the services requested by our clients. About This Privacy Notice The examples contained herein are provided as illustrations and are not a comprehensive account of the rights of any party under applicable federal or state laws. The policies stated herein will remain in effect even after an account is closed, to the extent that the information is retained. We may from time to time amend this policy and will inform you of any changes as required by law. For additional information, contact us via mail at the address on this letterhead.
Notice of Separation of Services This notice provides information regarding the relationship and separation of services between Balance Sheet Management & Consulting Services, Inc. ( BSMS ) and First Empire Securities, Inc. ( FES ). BSMS and FES are separate legal entities, each a wholly owned subsidiary of First Empire Holding Corp. BSMS provides comprehensive analytics and consultative services, including assetliability management analysis. FES is a regulated broker dealer executing trades for clients. BSMS maintains electronic, physical and procedural safeguards reasonably designed to maintain separation between BSMS and FES as follows: 1. Electronic Separation In order to prepare an ALM analysis, clients are directed to send the information needed to prepare the analysis directly to BSMS by uploading the information to a secure FTP site. This secure site is on a separate network from FES and is password protected and accessible only by authorized BSMS and IT staff. Registered representatives from FES do not have access to the FTP site. 2. Physical Separation The BSMS staff who receives your confidential information to prepare and produce your ALM analysis are physically separated from the registered representatives who service the clients through FES. 3. Separation of Services The ALM input, including but not limited to assumptions, market valuations, projections, etc., is determined by the BSMS staff and the client and is not discussed with or otherwise opened to influence by the registered representative who services the client through FES. Upon completion, the ALM analysis is provided to the client and may be provided to the registered representative and/or financial strategist on the account at FES. BSMS clients are not required to use FES as a broker to purchase or sell their investments. Fees for BSMS ALM analyses are paid directly to BSMS. Please contact your representative with any questions regarding this notice. 100 Motor Parkway, 2nd Floor Hauppauge, NY 11788 Tel: 631.979.0097 Toll Free: 800-645.5424 Fax: 631.979.0448