Johnson Bank rated 'weak' despite posting state's highest 1Q profit

Johnson Bank was the most profitable bank in Wisconsin last quarter, but it still made a "watchlist" of banks that are potentially in trouble.

The Racine-based bank received a "D+," or "weak," rating from Weiss Associates, a private company that researches U.S. banks. Weiss' list is spreading around the Internet and raising the public's concerns about the stability of hundreds of banks nationwide.

Weiss' list drew a strong response from Kurt Bauer, president/CEO of the Wisconsin Bankers Association.

“The public and media should not place any credibility in ratings of federally insured depository institutions prepared by private companies," Bauer said. "The only accurate ratings for financial institutions are issued by government regulatory agencies, and they are not made public out of fear that they could unnecessarily alarm depositors."

Johnson Bank's rating should be put in context. The J-S reported last week that Johnson Bank reported a profit of $5 million last quarter, which was the highest in the state. The $5 million in profit is a pittance compared to the bank's $5.6 billion in deposits, but many other banks lost money last quarter.

M&I Bank, which has $50.25 billion in deposits and lost $116 million in the first three months of the year, received a "D" rating on the Weiss list. Kenosha's Southport Bank, which has $425 million in deposits, received a rating of "E-," which was the list's lowest rating aside form failure. Associated Bank, of Green Bay, which had $22.6 billion in deposits, received a "D" rating. 

The list has spread across the Internet this week as Weiss's list of 2,259 U.S. banks that are weak or near failing was released. Ninety-eight Wisconsin banks made the "watchlist." Weiss also released a list of "strong" banks, which included 30 from Wisconsin. None of the strong banks were in Racine County.

Nationally, it's been a rough year on the banking industry. Thousands of bank have lost money and 73 banks have failed this year. 

Johnson Bank referred comment on Weiss's watchlist list to a prepared statement by Bauer. Speaking for the industry, he called the private list "sensational." 

"The private company ratings use arbitrary and often simplistic formulas based solely on information that is publicly available, which provides a narrow snapshot rather than a complete picture of the institution in question," Bauer said.

"The ratings may also be influenced by the business interests of whoever is calculating them. That is why these ratings are flawed and misleading at best, and dangerous and irresponsible at worst."

"Use of these ratings by the media is sensational and a disservice to the public,” Bauer said.

Another banking insider pointed out that the FDIC does not make its "troubled bank list" public. The public lists are created by private agencies that are the same ones that were praising Lehman Brothers and Goldman Sachs before the crash.

The private agencies now seem to have swung in the other direction, the insider said.

Caledonia has state's lowest unemployment rate

Caledonia has the lowest unemployment rate in the state, according to April numbers released this week by the Department of Workforce Development.

The City of Racine had a slight drop in its unemployment rate, falling from 16.5 percent in March to 16.4 percent 14.8 percent in April. The city added an estimated 400 jobs over the last month. The city has about 2,700 fewer jobs than it did in April 2009.

Racine County's April rate fell from 10.5 percent to 9.9 percent. Statewide, unemployment fell 1.6 percent from March to April, but had 46,665 jobs fewer than in April 2009.

Click here for the state's unemployment release.

Journal Sentinel can't find a 'best place to work' in Racine

Um, did the Journal Sentinel forget something?

Milwaukee's newspaper has come out with a special section touting Southeastern Wisconsin's 100 Best Workplaces -- but no companies from Racine were included.

Closest we came  is Gateway Technical College, 9th on a list of 15 best  large employers (with over 500 employees) --  but credited to Kenosha.

Most notably absent from the Journal Sentinel's listing is SC Johnson -- which regularly shows up in national best-places-to-work listings, like those of Fortune (SCJ ranked 83rd nationally in 2010 -- the tenth time it's made the list, while Johnson Financial Group was 22nd) and Working Mother magazines, AARP (best employer for workers over 50 in 2009), among others.

The Journal Sentinel said: "We set out to identify some of the companies and organizations in southeast Wisconsin that consider it an obligation, or at least smart business, to give their employees a fair shake and a fulfilling work experience. To do this, we invited workers to nominate their employers, and we enlisted the help of workplace consulting firm WorkplaceDynamics to survey tens of thousands of workers in the region."

And then they totally missed SCJ! We can only conclude that SCJ's employees were too busy actually  working to fill out the surveys.  

Here's the Journal Sentinel's full list.

We would, of course, be interested in hearing what SCJ employees have to say.

Update: A reader took offense that we singled out SCJ as one of Racine's great local employers. She correctly points out there are many good companies in our city. Here's her message:

We take pride where we work, our company is one of the few that actually increased our sales during the hardest times as of late. Not to mention the hard earned money I make in this company and others who work outside our town and commute back home, put hard money back into the city and its stores, mechanics, gas stations, fund-raisers, and local shops (could go on). I love Racine, moved here from Illinois, fought to believe the negative cloud hovered over this town and embraced for my own opinion. I advocate to all my friends who come from all directions to work and have brought them in to really see what our town is all about and they too have begun to change their minds. I am a proud homeowner in Racine and proud to live here. It truly is in my heart and would not want to ever move. The hometown feel, beach front, oasis, softball, parks, theatre, downtown shops, the history, I could go on. I am just a bit taken back by the comment. I would have agreed if you implemented more company's other than SCJ for Racine, they already are well known brand as it is and get plenty of press. Many great employers were missed and yet you chose to give SCJ such great kudos is an insult to many other Racine great companies. We do and should take pride in SCJ but give the others some written space too.

Salsa maker wins entrepreneur's award at RCEDC's annual meeting

Award-winning local entrepreneur Brian Peters at Wednesday's RCEDC annual meeting. 

If you know Brian Peters, you know the man loves his salsa. That love is on its way to becoming a successful business.

Peters, and his idea to create an all-natural salsa, won a local entrepreneur's competition Wednesday at the Racine County Economic Development Corporation's annual meeting. He beat out five finalists for the $1,000 award, which was voted on by a panel of local business owners.

Peters and the four other entrepreneurs gave "elevator pitches" of their business plans to an audience of about 300 local economic leaders gathered at the Veterans Terrace in Burlington. The three-member panel then put the future business owners on the spot, asking tough questions about their business plans and how they intend to create successful enterprises.

Other finalists included:

Norm Walker, Facilities Services and Solutions. Walker helps manufacturers who use compressed air find inefficiencies in their operations. He has a system that identifies, and then quantifies, potential energy savings. The service is actually free at the moment if business owners use the state's Focus on Energy rebate credit.

Jim Nondorf Jr., Water Separation Systems. Nondorf is looking to expand his Racine-based business to help businesses with large boilers become more efficient. He offers a reverse osmosis solution that reduces the amount of water and energy needed in boilers.

Raymond Madden, Computer Renewal. Madden will "up-cycle" used computers to prevent them from being dumped in the landfill. He intends to collect old computers, fix them, and sell them at discounted prices to consumers and businesses.

Ellen Ferwerda, home composting. Ferwerda plans to invent a garbage disposal that will compost food waste and convert it into nutrient-rich soil. It's meant to capitalize on growing interest in composting, which some cities are beginning to require as a way to reduce garbage.

Peters, whose business is called the Peters Cellars Family Kitchen, began working on his business in 2008 when he was laid off from his job after 20 years in the construction industry. He saw the forced career change as an opportunity to reinvent himself into the owner of a natural foods company. Peters' specialty is an all-natural salsa recipe that he intends to sell  as a top-brand salsa. He also plans to work with the homeless at HALO to create jobs and help people in need get work experience.

All five finalists were selected to participate in the "Launching Green Businesses" program, organized by UW-Parkside's Small Business Development Center and the Racine County Workforce Development Center. He and about 20 other entrepreneurs worked through a 15-week class to develop a business plan they can take to investors and lenders to get started.

The finalists were the featured speakers at RCEDC's annual meeting, which also included a review of the county's economic development in 2009 and the organization's annual awards.

Burlington Area School District Superintendent Ron Jandura, who is retiring after 40 years in education, received the Sam Johnson Volunteer Award. Odinn Johnson (left), Sam Johnson's grandson, introduced the award with stories about his family. He referred to Sam as "Grand-Sam" and recalled that the original Samuel Johnson, his great-grandfather, help support a southern school for former slaves

In his acceptance speech, Jandura talked about innovations in education that are helping students apply learning to the real world. One Burlington High class calls students to a "crime" scene at 2 a.m. to process forensic evidence, while another allows students to witness a live surgery. Burlington also created the state's first Construction Career Academy, which teaches students how to work in the building trades.

Jandura predicted major changes in school systems over the next five to 10 years. While education has resisted technology - walk into a school today and not much is different from 50 years ago, he said - it's headed toward a revolution.

In one specific case, Jandura said a student approached school officials about wanting to study Italian, so the administrators found an online class for him to take. The student went on to become an American diplomat in Italy, he said.

About 300 people attended RCEDC's annual meeting on 

Wednesday at Veterans Terrace in Burlington.

Other award winners included:

The Leonard W. Ziolkowski Public Sector Award - Gilbert Bakke, former RCEDC board member and current member of the Racine County Board

The Anthony J. DiCastri Private Sector Award - Roger Caron, president of the Racine Area Manufacturers and Commerce

Lender of the Year - Glenn Schroeder, vice president, business banking division at M&I Bank

RCEDC also recognized its business loan recipients in 2009. They included:

• Amarillo Towing of Wisconsin
• HM Product Solutions
• Johnson's Gardens
• Ketter's Flooring
• Maletto's Packaging
• Michelle R. Bonnesss, M.D.
• Nelson Bros. & Strom Quadra
• Spee-Dee Packaging Machinery
• Strategic Electronic Solutions
• Sturtevant Sportsplex
• Wisconsin Shower Door

RCEDC's 27th annual anniversary celebration started with a welcome talk by RCEDC board President Dan Pettit, followed by a summary of 2009 economic development results by County Executive Bill McReynolds.

Matt Wagner

Burlington Mayor Bob Miller

Matt Wagner, director of UW-Parkside's Small Business Development Center, introduced the entrepreneurs, and Burlington Mayor Robert Miller introduced the community award winners. 

Gordy Kacala, executive director of RCEDC, closed the meeting by saying that, in spite of the recession, he was "pleased with the progress we've had." 

Kacala added that competition is so fierce among communities for new businesses that he's afraid to announce future projects because other communities are trying to poach them.

"That's the reality we're dealing with," he said. 

Racine's Fischer Precise USA receives $63K in tax credits

The state is helping Racine's Fischer Precise USA replace equipment and hire new employees.

Gov. Jim Doyle announced Tuesday that the local company will receive $63,000 in tax credits from the Economic Development Tax Credit Program from the Department of Commerce to help upgrade the equipment for its facility in Racine and create 14 new jobs over the next three years.

Fischer Precise USA provides high speed rotational systems, which are used in many industries such as aerospace, electronic, and medical. The company recently moved its product line to Racine and is investing $1.3 million to upgrade its equipment.