A line item in Wisconsin Gov. Jim Doyle’s 2009-2011 state budget could drastically change the outcome of civil court cases in the state and may greatly endanger the state’s small to medium sized businesses, opponents to the change say.

Doyle’s budget would change the state’s provision for joint and several liability, if it is signed into law. Current state law mandates that a defendant be found at least 51 percent at fault to be found liable. However, Doyle’s budget proposes that a defendant, whether a corporation or individual resident, could be liable if they were found at least 1 percent liable.

“If you’re a manufacturer of a bicycle and someone is injured on that bike… and if the (jury) finds the bike company 1 percent responsible, they can be required to pay 100 percent of damages,” said Bob Fassbender, spokesman for the Wisconsin Civil Justice Council Inc. (WCJC). The council was formed to represent Wisconsin employers facing litigation.

“This (legislation) is after deep pockets – manufacturers and other businesses – which plaintiff lawyers will attempt to find, to find someone a little bit responsible so they can get those deep pockets into court and get a settlement," Fassbender said.

Bill Smith, state director of the National Federation of Independent Businesses (NFIB), said that if the state’s provision for joint and several liability is changed, it will present two significant problems to the state’s business community.

“This could make every Main Street business vulnerable to lawsuits and it destroys the predictability we want to have in our civil justice system,” Smith said. “This restores unpredictability in our state – it puts every small business in jeopardy of being caught in a lawsuit.”

The change will cause raise insurance premiums, both Smith and Andrew Franken, president of the Wisconsin Insurance Alliance, said.

“Back in 1995, a lot of changes were made that brought more sanity to our (legal) climate in Wisconsin,” Franken said. “This turns the clock back, which will jeopardize every manufacturer, church or charity that will be subject to lawsuits that go down to one percent of occurrence.”

The Wisconsin Association for Justice, formerly known as the Wisconsin Academy of Trial Lawyers, said the change will ensure that residents and their health insurance providers are not left without protection after a car accident or other damages.

“We are at a time in our history when we need to revisit the playing field with it comes to the rights of consumers,” said Mark Thomsen, president of the association. “There have been a lot of changes made over the past couple of decades that have tipped the playing field against the consumer in many ways. This change in the law will help restore fairness in the law for consumers.”

A Doyle administration spokeswoman agreed with Thomsen.

"The provision addresses a fairness issue by taking the burden of the costs to care for severely injured people off of society and onto the people at fault," said Carla Vigue, deputy press secretary with the Doyle administration. 

Anchor Bank does not have enough cash to repay loan from U.S. Bank

Madison-based Anchor Bancorp Wisconsin Inc., the parent company of Anchor Bank, is facing a March 2 deadline to repay $56.3 million of a $116.3 million revolving line of credit to U.S. Bancorp, the Minneapolis-based corporate parent of U.S. Bank.

However, according to Anchor's Feb. 17 filings with the U.S. Securities & Exchange Commission (SEC), Anchor Bank does not have sufficient cash on hand to make the payment and will not likely be able to raise enough to pay it.

"As of the date of this filing, we do not have sufficient cash on hand to reduce our outstanding borrowings to $60 million," the filing stated. "There can be no assurance that we will be able to raise sufficient cash on hand to reduce the borrowings to $60 million prior to March 2, 2009."

The balance of the loan, issued on June 9, 2008, is due on Dec. 31, 2009, and there is no commitment within the loan agreement for renegotiation. If Anchor Bancorp is unable to repay the balance of the loan and U.S. Bancorp is unwilling to renegotiate its terms, U.S. Bancorp could foreclose on Anchor Bancorp.

"If we fail to meet our payment obligations under the credit agreement, such failure will constitute an event of default under the credit agreement," the SEC filing states.

Anchor is the fourth-largest Wisconsin-based bank.

In the event of a default, U.S Bancorp could decide not to allow Anchor Bancorp to borrow further, could terminate its outstanding commitment or could seize outstanding shares of Anchor's stock that have been pledged as capital under the loan.

"If the agent (U.S. Bancorp) were to take one or more of these actions, it could have a material adverse effect on our reputation, operations and ability to continue as a going concern, and you could lose your investment in the securities," the filing stated.

Mark Timmerman, president and chief executive officer of Anchor Bank, told BizTimes Milwaukee that his bank is in active negotiations with U.S. Bancorp.

"We are well along in active negotiations with U.S. Bank to reach an agreement on an amendment (to the line of credit)," Timmerman said. "We are expecting a proposal in the near future. We believe we’re making progress. At this point, we're well capitalized and not in default. These (negotiations) are occurring and I imagine will continue to occur on a very active time frame. We want to get this resolved - all parties want to get this resolved."

A U.S. Bancorp spokesman declined to comment on the matter.

In its filing with the SEC, Anchor Bancorp reported a loss of $167.3 million during the fourth quarter of 2008, including $60.3 million in loan losses. The bank had $6.3 million in net income during the same quarter of 2007.

Anchor Bancorp had about $4.8 billion in total assets at the end of the fourth quarter.

Anchor Bancorp sold $110 million in its senior preferred stock shares to the U.S. Treasury under the federal Troubled Asset Relief Program (TARP) on Jan. 30.

Customers of Anchor Bank are covered by the Federal Deposit Insurance Corp. insurance up to $250,000, regardless of what becomes of the bank.

Name: Ignatius L. Smetek

Title: President and chief investment officer

Company: Arcataur Capital Management LLC

Family: Nancy (wife), sons Danny (14) and Sam (12)

City of Residence: Brookfield

What's new at your company? “We were recently notified of being named a 5 star recipient for client satisfaction for investment managers through an independent survey of southeastern Wisconsin.”

What are the most interesting issues you work with clients on? “Communication and execution of a sound investment plan to achieve their goals. With the difficult economic environment our clients have been grateful for our discipline and integrity.”

What is the most difficult or challenging project you've been involved with? “Financial markets always offer exciting challenges, but our successful history is based upon looking for opportunity while most are focused on risk, or looking for risk when the crowd is focused on opportunity. 

What was the funniest moment of your career? “Bumping into Donald Trump in the men’s room after a meeting and needing to explain to him how the motion-activated faucets on the sink worked.”

Marshall & Ilsley Corp. recently made several high-level promotions. They include:

• M&I Wealth Management recently promoted Susan M. Hickey to vice president, trust services. Hickey previously served as assistant vice president, trust services. She has been with M&I since 2007.
• M&I Bank has promoted Michael Wood, vice president, manager of delivery management to senior vice president. Wood has been with M&I since 1986 and has more than 23 years of industry experience.
• M&I Support Services has promoted Andrea McIlwraith, corporate project manager, to vice president. McIlwraith has been with M&I since 2008 and has more than 14 years of industry experience.

Shareholder advocates call for political transparency for banks

Warning that "gaps in transparency and accountability" contributed to the current economic crisis, shareholder advocates have called on 19 financial companies, including Milwaukee-based Marshall & Ilsley Corp., that received more than $1 billion under the U.S. Treasury Department's Troubled Asset Relief Program (TARP) to disclose and require board oversight of their political spending with corporate funds.

The Center for Political Accountability (CPA) is a nationwide shareholder initiative to bring transparency and accountability to corporate political spending.

The companies, which received a letter signed by 23 shareholder advocates, have limited or no political disclosure.

Only three financial services companies - Prudential Financial Services, American Express and Capital One - have agreed to full reporting and board oversight of their political spending with corporate funds. The reporting includes soft money contributions and payments to trade associations and other tax exempt organizations used for political purposes.

The letter called "disclosure of political spending  ... a key part of transparency and accountability. To help rebuild shareholder and public trust in financial services institutions," it continued, "we are writing to urge your company to disclose and require board oversight of its political spending with corporate funds."

"As major political givers, banks should, as a matter of course, be open and above board in this spending," said CPA executive director Bruce Freed. "Unfortunately, many have been resistant to full disclosure. A safe and sound financial system must be based on transparency and accountability."

A recent Washington Times article reported that political action committees of JP Morgan Chase, Bank of American, Wells Fargo, Goldman Sachs and other banks have contributed more than $2 million since last October as they were receiving TARP funds.

In addition to Marshall & Ilsley, which is the parent company of M&I Bank, the other companies receiving the letter from the CPA are: Bank of America, Citigroup, JPMorgan Chase, Wells Fargo, Goldman Sachs, PNC Financial Services, Regions Financial Corp, SunTrust Banks, Fifth Third Bancorp, BB&T, Bank of New York Mellon, KeyCorp, CIT Group, Comerica, State Street, Northern Trust, Zions Bancorporation and Huntington Bancshares.

Marshall & Ilsley spokeswoman Sara Schmitz told BizTimes Milwaukee, "We have not had an opportunity to review this document, and therefore are unable to comment at this time."

The letter was signed by the CPA and several other organizations, including Adrian Dominican Sisters, AFL-CIO Office of Investment, As You Sow, Boston Common Asset Management, Calvert Asset Management Co., Catholic Healthcare West, Congregation of St. Joseph, Domini Social Investments, Dominican Sisters of Hope, International Brotherhood of Teamsters, Mercy Investment Program, Midwest Coalition for Responsible Investments, Nathan Cummings Foundation, Newground Social Investment, Pax World Management Corporation, Sisters of Charity of the Blessed Virgin Mary, Sisters of Mercy Regional Community of Detroit Charitable Trust, Sisters of St. Joseph of Carondelet and Associates St. Louis Province, Socially Responsible Investment Committee of Congregation of St. Joseph, Trillium Asset Management Corp., Ursuline Sisters of Tildonk, U.S. Province and Walden Asset Management.

The letter urged financial services companies to:

• Disclose on the company website all political spending including soft money contributions and payments to trade associations and other tax-exempt organizations that are used for political purposes.
• Require board oversight of their corporate political spending.
• Adopt policies and procedures for approval and review of political spending.

For additional information, visit www.politicalaccountability.net.

Fiserv launches new brand campaign

On its 25th anniversary as a company on Monday, Fiserv Inc. unveiled a new logo, an enhanced market approach and a new brand identity for the banking technology company.

The full integration of CheckFree's electronic commerce operations within Fiserv has been a catalyst to drive increased innovation and focus the power of Fiserv's cumulative expertise on helping clients grow their business and increase profitability.

"Our enhanced market approach and vibrant new identity are reflective of the significant change occurring within the financial services industry. We have the expertise, resources and scale to lead this transformation," said Jeffery Yabuki, Fiserv president and chief executive officer. "Fiserv provides processing technology solutions for more financial institutions than anyone in the world. That scale, combined with our market-leading products and services, uniquely positions us to lead the development of next-generation solutions that will transform the way financial services are delivered."

Starting today, all of Fiserv's solutions are under the new brand and some offerings have been renamed. Fiserv innovations include: Source Capture Solutions, a full suite of solutions that enable electronification of all sources of deposits; Corillian Online (formerly Online Advantage), the next-generation platform for online personal financial management; Mobile Money, a mobile banking solution unique in its ability to support all mobile access protocols; MyMoney, the unique solution that leverages social networking technology to connect consumers with financial institutions; Business Analytics for Premier (formerly Viewpoint), the solution that enables proactive business intelligence practices as part of Fiserv's Premier banking solution; and Bank Intelligence Solutions (formerly BancIntelligence), comprehensive online advisory tools that aid financial institutions in decision-making.

The company's organizational structure has been aligned to streamline Fiserv's market approach, accelerate product innovation and make it easier for clients to access the full breadth of Fiserv solutions. All of the company's businesses have been unified under the new brand and report through two primary operating divisions led by Steve Olsen, former CheckFree chief operating officer and now Fiserv group president, and Tom Warsop, Fiserv group president.

For more information about the changes, visit www.newfiserv.com.

Feingold unveils web site to navigate stimulus plan

U.S. Sen. Russ Feingold (D-Wis.) recently unveiled a web site dedicated to informing Wisconsin communities, residents and businesses about the details of the American Recovery and Reinvestment Act.

The web site, http://feingold.senate.gov/recovery, includes information on how Wisconsin will benefit from the bill.

"Now that the economic recovery passage has become law, it is time to make sure it does what it is intended to do like creating jobs and easing the financial burdens felt by Wisconsin businesses and families," Feingold said. "Since the bill is so large and involves so many different initiatives and projects to get our economy going, I want to be as helpful as possible in educating people in Wisconsin about the bill. My site will be continuously updated as the recovery plan is implemented.  I encourage people to visit the website to learn the details about the many positive things this bill will do for Wisconsin."

The site includes a FAQ (frequently asked questions) section and a section that lists the many grant programs funded through the bill to help job training programs, law enforcement agencies, energy efficiency programs, transit programs, housing development programs and other efforts to create or save jobs.

Previously, the Obama administration announced the creation of www.recovery.gov, and Wisconsin Gov. Jim Doyle announced the creation of www.recovery.wisconsin.gov.

Regulatory agency fines Baird for fee violations

The Financial Industry Regulatory Authority (FINRA) has fined Milwaukee-based Robert W. Baird & Co. $500,000 for supervisory violations relating to its fee-based brokerage business.

The FINRA also ordered Baird to return $434,510 in fees, plus interest, to 154 customers. Those customers either paid fees in fee-based accounts without generating activity or paid fees higher than those indicated on the Baird fee schedule.

The FINRA found that Baird's failure to adequately review its 360/One accounts during a period in which the 360/One program grew from approximately 7,000 accounts to more than 11,000 accounts allowed numerous 360/One customers to remain in the program despite conducting no trades for at least eight consecutive quarters. The accounts paid more than $269,000 in fees during the inactive quarters.

Baird also failed to have a supervisory system in place to automatically credit certain 360/One customers with breakpoint discounts that were specified in new account agreements. As a result, 53 customers paid fees higher than those indicated on the Baird fee schedule, resulting in total overpayments of approximately $165,000, the FINRA said.

In addition, from May 1999 through January 2005, Baird failed to adequately disclose to its fee-based customers that assets held on margin - for which the customer might already be paying interest - and short sales were included as eligible assets for purposes of fee calculation, the FINRA said.

In settling this matter, the firm neither admitted nor denied the charges, but consented to the entry of FINRA's findings.

The FINRA is the largest independent regulator for all securities firms doing business in the United States. Investors can obtain more information about the matter at www.finra.org/brokercheck.

Acuity caps record year

Acuity Insurance wrote an all-time record amount of premium in personal lines in 2008, finishing the year at $196 million.

In commercial lines, the Sheboygan-based property and casualty insurer wrapped up 2008 with 82,044 policies, an all-time high. The insurer also set new benchmarks for quote issuing success, booking a record 38.1 percent of the quotes it issued. The 47,453 commercial lines quotes that independent agents submitted also was a record.

"Acuity's results in 2008 show that we continue to build on the foundation of strength and stability that policyholders rely on to protect their personal and financial well-being and independent agents depend on to grow their own businesses," said Ben Salzmann, Acuity's president and chief executive officer.

Obama unveils plan to stabilize housing market

The Obama administration unveiled a plan last week to help 9 million "at risk" homeowners modify the terms of their mortgages and stay in their homes.

President Barack Obama plans to announce the details of the plan later today in Arizona, one of the most decimated real estate markets in the nation.

Obama plans to commit $75 billion of taxpayer money to back the homeownership initiative.

His plan contains two separate programs. One is aimed at 4 million to 5 million homeowners struggling with loans owned or guaranteed by Fannie Mae or Freddie Mac to help them refinance their mortgages through the two institutions. Homeowners who have Fannie Mae or Freddie Mac loans who are having a difficult time refinancing and owe more than 80 percent of the value of their homes would be eligible to refinance with the program.

A separate program would be aimed at 3 million to 4 million homeowners by allowing them to modify their mortgages to lower monthly interest rates through any participating lender. With the plan, the lender would voluntarily lower the interest rate, and the government would provide subsidies to the lender.

"The plan I'm announcing focuses on rescuing families who have played by the rules and acted responsibly: by refinancing loans for millions of families in traditional mortgages who are underwater or close to it; by modifying loans for families stuck in sub-prime mortgages they can't afford as a result of skyrocketing interest rates or personal misfortune; and by taking broader steps to keep mortgage rates low so that families can secure loans with affordable monthly payments," Obama said in prepared remarks.

Meanwhile, the U.S. Commerce Department announced today that the collapse in the housing industry accelerated in January, as construction on new U.S. housing units plunged 16.8 percent to a seasonally adjusted annual rate of 466,000, the weakest levels of construction in the post-World War II era.

Housing starts have dropped at double-digit rates for the past three months.

Inlanta Mortgage adds in-house underwriting

Inlanta Mortgage, a Waukesha-based mortgage banker and broker, has added in-house underwriting to its extensive list of support services for loan officers and partner branches.

“With numerous, significant benefits in operating with in-house underwriting, we are pleased to bring this resource to our loan officers and branch partners,” said Jean Badciong, vice president of operations at Inlanta Mortgage.

Randy Burgei, a FHA Direct Endorsement Underwriter, has joined Inlanta Mortgage to develop the company’s in-house underwriting, insuring and shipping departments. He also helped the company achieve full Eagle status, meaning Inlanta will be able to originate and sell FHA-insured mortgages without prior approval from a sponsoring lender. With Burgei’s Direct Endorsement status, the company can streamline the application process and provide greater flexibility for originators and borrowers.

For more information, visit www.inlanta.com.

The Financial Planning Association of Southern Wisconsin will present "Advising Clients on Selling Their Businesses" on Thursday, Feb. 26, from 7:45 a.m. to 12:30 p.m. at Country Springs Hotel, 2810 Golf Road, Pewaukee. The event will include information on valuation, taxes, legal concerns and tips on working with a mergers and acquisitions advisor. For more information, click here.

The American Society of Women Accountants Milwaukee Chapter will hold its “ASWA Student Night” on Tuesday, Feb. 24 from 6-8 p.m. at Klemmer's Banquet Center, 10401 West Oklahoma Avenue, West Allis. The event is held to encourage networking between students and accounting and financial professionals. Raffles and auction items sold will benefit the ASWA scholarship fund. Cost is $22 for members, $24 for guests and $19 for students. For more, contact Kathy Burzynski at 262-335-0763 or Bur@BurzynskiES.com.

World Trade Center Wisconsin will present its “Successful Cross-Cultural Negotiations” seminar on Tuesday, March 24 from 7:30 a.m. to noon at the University Club of Milwaukee, 924 E. Wells St. The event will feature keynote speaker Eric Etchart, president of Manitowoc Crane Group, as well as presentations on negotiation strategies, regional differences and a case study. Cost is $65 for WTC members and $85 for non-members. For information or to register, call 414-274-3840.

Banking

• Wisconsin Department of Financial Institutions 
• Federal Deposit Insurance Corp.
• Wisconsin Bankers Association 
• Community Bankers of Wisconsin
• Wisconsin Mortgage Bankers Association
• American Bankers Association
• Bankers Association for Finance and Trade
• Commercial Finance Association 
• Risk Management Association

Mergers & Acquisitions

• Association for Corporate Growth 
• International Business Brokers Association 
• Mergers.com

Wealth Management/Financial/Retirement Planning

• Financial Planning Association
• Financial Planning Association of Southern Wisconsin
• Investment Management Consultants Association
• National Association of Personal Financial Advisors (NAPFA)

Other 

• Small Business Administration
• State public awareness campaign
• Wisconsin Credit Union League
• CFA Institute
• CFA Society of Milwaukee
• Wisconsin Angel Network