Park State Bank News

The Big Picture is Shifting Rapidly

These are challenging times in financial markets. Frankly, I nor anyone else has any experience with economic and financial disruptions caused by proclamation from policy makers around the globe. Two weeks ago I did not expect the entire global economy to be closed almost overnight. Normally, policy makers blundering with monetary or fiscal policy cause recessions. Not this time, this is a disease-­‐induced problem with enormous economic and financial consequences. What I know, or think I know shifts daily. This is an attempt to help explain with the caveat that understanding will evolve next week and the week after, so I will start with this and send updates often.

In the past two weeks, Covid-­‐19 grew from a distant threat to reality. Most Americans did not anticipate this or how long it will remain a threat. The biggest change for me is the acceptance that the damage is not likely to pass in a month or two. It now appears there will be a sharp drop in global activity, followed by a period of significant weakness lasting at least two quarters, followed by a partial recovery. At some point, the expectations of worse outcomes will give way to expecting better outcomes and the panic in markets will cease.

The Economy Will Recover

Perspective is important. After the Great Recession from 2007 to the second quarter of 2009, it took two years, until the second quarter of 2011, for growth to recover to the pre-­‐recessionary peak. The market recovery begins before the economic recovery, and the economic recovery begins years before growth and employment recover cycle highs. A few weeks ago, none of us were familiar with social distancing, but apparently it is the only means of suppression of a virus as contagious as this one. It requires an unprecedented disruption to daily activities and the economy. How the economy reacts once these measures are lifted us largely unknown.

Best guess for a timeline:

• Step 1: until this week, economists focused on how long it takes to get to peak infection, when the spread of the virus is “under control.” They thought the economy would return to normal at that point. Markets traded accordingly.
• Step 2: this week, people began thinking about the measures needed to prevent further increases once peak infection is reached. No school, no office work, no movies, no sports, no bars, no restaurants, and no retail beyond groceries and pharmacies, except online. These restrictions will not be dropped all at once just because the number of cases levels off. And certain activities may be permanently altered.
• Step 3: Peak infection, normal life resumes and with it -­‐ restarting the economic engine.

Judging from China and a few other Asian countries, step 1 takes months. The CDC estimates the US will reach peak cases in July or August. Steps 2 and 3 are still unknown.

Policy Response

The Federal Reserve and Congress are working hard for answers. I am confident they will find them. Some stimulus measures will have immediate impact and some delayed, but they will all help. The Fed cut the fed funds rate 150bp to 0-­‐.25%. Last week, they have provided credit markets with several trillion in various programs providing badly needed liquidity, and transformed their $60bn/mo balance sheet expansion program from not-­‐QE (using one short term asset to buy another short term asset) into sort-­‐of-­‐QE (using a short term asset to buy longer-­‐duration assets, but with no pre-­‐announced time line or quantity).

The Fed decision to invoke quantitative easing is a signal to markets. And they are not alone, more than half a dozen central banks acted or pledged action in the past 24 hours. Policy makers will not get everything right, but they will react and adapt.

Fiscal policy takes longer to formulate than monetary policy, but US policymakers have set aside politics and gotten to work. They have passed what they term two phases of stimulus and they are currently working on phase three – expected to be north of 1.5 Trillion. Markets have whipsawed. The global drop in stocks is as big as in the first 150 days of 2008-­‐09, but in a fraction of the time.

Don’t Panic

This is a globally synchronous event. Even the global financial crisis hit the world in a staggered fashion. This time, all of the biggest economies are sinking within a few months of each other. There will be significant job losses. I’ve seen estimates Global GDP could drop 10% in the first half of 2020, implying about $8.5 trillion of lost income. A 1% drop in global GDP, by the way, would be the worst ever. The fallout from a 10% drop is hard to imagine. I know that sounds scary, and it is, but it is important to state the economy will recover from whatever is thrown at it. No matter how deep the downturn, there will be a recovery.

As an abundance of caution, the bank has decided to close the lobby as of Wednesday 03-18-2020. Our drive-up will be open normal hours, from 8 am to 6 pm Monday through Friday and 9 am to Noon on Saturday. We will continue to monitor the situation and inform you when we are returning to normal operations.

During these modified hours please note the following:

• Our Team: We are committed to supporting your banking needs. We will be at the bank to provide support, and the lobby tellers will be answering phones to make sure we maintain a high level of service.
• Safe Deposit Box Access: Please call or email, and we will set an appointment with you for access to your box.
• New Accounts: We will work with you over the phone and use our secure portal to gather the needed documentation. We will then set an appointment with you to arrange for your signature.
• Loans: We will continue to accept applications and work on your loans. We will work with you over the phone and use our secure portal, then we will set an appointment for loan closings.
• Construction Draws: Construction Draws can be dropped through the drive-up commercial window. You may also contact us to coordinate drop off and pick up from the bank. We encourage you to sign up to submit your draw requests electronically to facilitate a safe, secure and expedited process.
• Construction Workers: If you need to cash a check and do not have an account with us, please use the drive-up window by the building. If you have an account, any lane will work.
• Trust: Our team stands ready to continue supporting your trust needs and will work via phone and electronically to continue to provide full service. We will make appointments as necessary.
• Accounting: As always, we will continue to process any invoices for payment to you the day we receive them. We will continue to be “the fastest pay in town” as some of our vendors have described us.

Community

As your community bank, we will continue to provide support to the amazing nonprofits that serve our community. Two organizations that have enhanced their operations and missions during this time to include food and emergency services are:
Community Partnership, Divide – 719.686.0705
Community of Caring, Cripple Creek – 719.689.3584

Hotline

For customers in need of additional assistance, please call and leave a message on our HOTLINE at 719.686.5218.
If you have an emergency, you can reach me at any time at 719.433.4055.

Everyone, please remain safe. We appreciate all of you.

Thank You,
Tony Perry and the Park State Bank & Trust Team

FIRE Update

It does appear that an electrical issue caused our small fire. One Sprinkler, which flooded the first floor and basement, along with the smoke damage, encouraged us to renovate. We are happy to report that thanks to our great vendors, we are a week ahead of schedule on restoring the interior back to normal. In the future, the roof damage will be repaired, with no impact to operations. We appreciate your patience.

We are currently in the process of renovations related to recovery from the smoke and water damage. We are projecting a target completion date of April 6, 2020. Over the next several weeks, team members will be re-locating based on the work currently in process. Brenda or another person at the Front Desk will direct you accordingly based on the day.

We sincerely appreciate your patience with the construction.

Hours:
We are working hard to maintain our standard hours listed below and we will notify you if the hours are modified for repair work.

Teller Drive-up: Monday through Friday from 8 am to 6 pm. Saturday from 9 am to Noon.

Lobby Entrance: Monday through Friday from 9 am to 5 pm. Saturday 9 am to 12 pm.

Craig Ketchum LPL Financial: Craig can be reached by calling his assistant Aprel German at 817-984-3385.

Monday morning, Jan. 27th, at 3:06 am the bank experienced a fire on the east side of the building. We do not have a definitive determination of the root cause of the fire, but we will communicate it to you once we have one. The alarm worked properly, and the sprinkler system did its job. Unfortunately, the water and smoke damage were extensive and required some significant repairs.

The safety and security of our team and customers is our priority. We have worked hard to re-open access to the lobby while we organize our construction plan and timelines.

Hours:

Teller Drive-up: Monday through Friday from 8 am to 6 pm. Saturday from 9 am to Noon.
Lobby Entrance: Monday through Friday from 9 am to 5 pm. Saturday 9 am to 12 pm.
Teller Line: Teller transactions will now be handled in the Lobby and Drive-up. We appreciate your patience with our repairs to the building.

Personal Banking:

Personal bankers will be in their usual areas. Again, we appreciate your patience with our repairs to the building.

Loans: Loan Officers and Loan Administrators are working from their usual desks and are available from 9 am to 5 pm Monday through Friday. We appreciate your patience with the slight delay to our usual expedient response in some loan processing. The team is working hard, and we will be caught up early this week.
Trust: Marcie and the team are working from the second floor. Brenda is at the top of the stairs and she will coordinate getting you in.
Accounting: Operations are on the second floor and normal operations are in effect.
Craig Ketchum LPL Financial: Craig can be reached by calling his assistant Aprel German at 817-984-3385.

Thank You,
Tony L. Perry
President & CEO

Last Monday morning at 3:06 am the bank experienced a fire on the east side of the building. We do not have a definitive determination of the root cause of the fire, but we will communicate it to you once we have one. The alarm worked properly, and the sprinkler system did its job. Unfortunately, the water and smoke damage are extensive and will require some significant repairs.

The safety and security of our team and customers is our priority. For that reason, we have adjusted our operations. Until the bank is ready for normal operations the following will be in effect.

Hours:

Teller Drive-up: Monday through Friday from 8 am to 6 pm. Saturday from 9 am to Noon.
Lobby Entrance: Monday through Friday from 9 am to 5 pm. Saturday Closed.
Teller Line: All teller transactions will be limited to the drive-through until further notice. We recognize that the lines will be longer than usual. We will have all tellers on deck to minimize the transaction time.
If you need coin deposits or change orders. Please call 719-686-5214. A teller will take your information and call you back with a plan to take care of your needs.

Personal Banking:

Personal banking is operating on the second floor above the entrance to the bank. They will be able to take care of your banking needs. We can facilitate access to your safe deposit box, and you will be escorted for your safety.

Loans: Loan Officers and Loan Administrators are working from their usual desks and are available from 9 am to 5 pm Monday through Friday. We appreciate your patience with the slight delay to our usual expedient response in some loan processing. The team is working hard, and we will be caught up early this week.
Trust: Marcie and the team are working on the second floor. Brenda is at the top of the stairs and she will coordinate getting you in.
Accounting: Operations are on the second floor and normal operations are in effect.
Craig Ketchum LPL Financial: Craig can be reached by calling his assistant Aprel German at 817-984-3385.

Thank You,
Tony L. Perry
President & CEO

Monday morning January 27th at approximately 3:06 a.m. Park State Bank experienced a fire under a soffit on the east side of the building. The fire damage was mitigated by our sprinkler system. The sprinkler system did such a great job that we are now assessing the damage, root cause, and have begun mitigation efforts.

The drive-up is open and operational from 8 am to 6 pm. We expect to have access to the rest of the bank Thursday or Friday morning.

We can facilitate entrance to your safe deposit box if you have a critical need. If you need access to your box, call Craig at 719-231-9046.

Please call me at 719-433-4055 with any critical concerns or questions regarding any loans in progress. Our loan officers will be returning calls starting on Thursday, if they have not already.

This site will be updated on a regular basis until we resume complete, normal operations.

Thank You,
Tony L. Perry
President & CEO

Welcome to the refreshed Park State Bank & Trust website. The goal is to speed up, and simplify the site, while making it easier to keep the information updated.  We also wanted to lay the groundwork for future tools that we will provide to you.  With this rollout you will also now have access to Mobile Banking and a Mortgage Loan Online Application and Personal and Business Loan Applications.

We will be closed Monday, September 3, 2018 in observance of Labor Day.  Have a safe and happy holiday weekend.

Please take a look around and let us know what you think via [email protected]

Update 09/04/2018:  We have been told the ATM should be repaired in the afternoon of 09/05.  We appreciate your patience.

We were informed that the motherboard in the ATM is fried.  We are awaiting an eta on replacing the board.  That said, we are also in the process of ordering a New ATM to replace it.  We appreciate your patience and will keep you updated here.  Thank You.