UMB stands tall among banks, but how about a reward for good behavior?

• Author: Cote, Mike
• Position: COTE'S [colorado] - UMB Financial Corp.

Since lawmakers signed off on a $700 billion Wall Street bailout, UMB Financial CEO Mariner Kemper has been making a pitch for banks like his that didn't contribute to the subprime mortgage slide.

What's in it for them?

Sure, it's great PR to have SmartMoney magazine name UMB among the strongest, best-capitalized banks in the country "primed to lead the way in a financial-sector recovery." But banks that took high-risk gambles are going to get propped up by taxpayer dollars--while those that did right by shareholders and depositors will get nothing but kudos.

"Those institutions that abused the system will come out on the back end stronger and back to compete against us," Kemper says. "And we'll have paid for it through FDIC premiums. We'll have paid for their mistakes. I think it's unfair and sends the wrong message."

UMB Financial Corp. operates 135 banking centers throughout Colorado, Missouri, Illinois, Kansas, Oklahoma, Nebraska and Arizona. The Kansas City-based holding company has less than $10 million in bad loans and one of the lowest nonperforming loan ratios in the industry.

It's weathered the credit crisis with a strong price--to-earnings ratio of 24. Its stock was trading at $50 in mid-October, $19 off its 52-week high but $7 higher, or 16 percent, over a year ago and performing well compared to its competitors.

Kemper, who is based in Denver, would like to see a reduced Federal Deposit Insurance Corp. premium for highly rated banks like UMB and make those that abused the system pay for it.

"If you have a bad driving record, you pay more for your insurance," he says. "I have a good driving record, and I may end up paying for all those bad drivers out there."

Kemper had a chance to make his plea to someone who has the power to do something about it during a recent trip to San Francisco for the ColoradoBiz annual Top Company trip, (a jaunt to California wine country that UMB has sponsored since its inception a decade ago.)

While dining with his wife at a San Francisco restaurant, Kemper spotted U.S. Speaker of the House and local resident Nancy Pelosi at a table nearby. He couldn't resist the urge to talk to her about the financial crisis.

"She had asked me whether I thought they were doing the right thing," Kemper said. "I told her that the further they take direction toward...