Just two days into a new job, Jim Schipper knew he would be changing his vacation plans.

Schipper, 61, is the Osceola banker who was tapped by Gov. Terry Branstad to replace Tom Gronstal as state superintendent of banking.

In the past, Schipper and his wife would run off to Lake of the Ozarks to take a breather from his role as president of American State Bank, an institution he founded in 1987 with a group of investors.

“That schedule is going to be adjusted pretty dramatically,” Schipper said. “This is going to take a fair amount of time and attention.”

Not that Schipper was left with a pile of woe concerning the condition of the 312 state-chartered banks he will oversee, not to mention mortgage lenders, loan companies, payday lenders and other financial institutions regulated by the Iowa Division of Banking.

For the most part, Iowa banks are healthy. Maybe a dozen still suffer from the breakneck competition for customers and the less-than-sound underwriting that prevailed during the development boom that went bust in 2008.

“The state’s been fortunate. Our industry in the state is pretty unique,” Schipper said.

The most recent data from the Federal Deposit Insurance Corp. show that 92 percent of state-chartered banks are profitable, their capital levels are above industry norms and they are removing bad debt from their balance sheets.

And, Schipper is quick to note, the Banking Division was in capable hands for nearly a decade with Gronstal at the helm.

The men are longtime acquaintances, and each is quick to compliment the other’s abilities.

In an interview before he left office, Gronstal said Schipper “will do a great job” as banking superintendent.

Regarding Gronstal, Schipper said, “I’ve known Tom for a long time, and I have a lot of respect for him, and I think the strength and soundness of the industry in Iowa is to his credit and the staff’s credit for having provided solid oversight and direction of the industry.”

The superintendent serves at the pleasure of the governor. Schipper is a Republican; Gronstal is a Democrat.

Schipper said he is not anticipating holding the job for more than four years, the length of the governor’s term. He will be 65 then; retirement might seem a better option than it did when he found out he was being considered for the banking superintendent post.

Schipper was not born to be a banker, but by the time he entered Iowa State University, he was pretty certain he wanted to enter the industry.

He grew up in Butler County and played football for Aplington High School “before all the NFL players showed up,” he said. His father was a “butter maker.”

“My generation was the first (in the family) to enter banking,” he said. Now, his daughter, his brother-in-law and two cousins are bankers.

Schipper worked for the U.S. Department of Agriculture after graduating from ISU. Then he landed a job as a loan officer trainee at Clarke County State Bank in Osceola. It was the launch of a career during which he learned banking from the ground up, first filing checks and checking endorsements, doing manual calculations of interest accruals and working a teller window.

“We did a lot of things the old-fashioned way. I came up old school and learned a lot of the operational aspects of banking hands-on,” Schipper said.

That hands-on approach is evident in the way American State Bank treats its customers, said John Sorensen, president and CEO of the Iowa Bankers Association and one of the people who recommended Schipper for the state banking superintendent job.

“I’ve been in American State Bank many times, and I’m always impressed, not just with the organization, but the customer service mentality of the staff, and I think that comes from the top down,” he said.

American State Bank was founded in April 1987, when Schipper organized an investor group to buy the failed Osceola State Bank & Trust Co.

At the time, Osceola State Bank had a little more than $7 million in assets.

As of Dec. 31, 2010, American State Bank had $117 million in assets, $92 million in deposits, $79 million in loans, $9.2 million in equity capital and annual net income of $1.8 million.

Schipper is proud enough of the numbers that a chart showing the bank’s progress was the only item decorating his Grand Avenue office on his second day on the job.

Though the state’s banking industry is on fairly solid footing, it faces challenges, especially with changes in federal banking regulations that were intended to target the mega banks with more than $10 billion in assets, but are sure to filter down to community banks, Schipper said.

“I was never convinced that community banks were going to be immune from all of that,” he said.

One key area that did not leave community banks untouched is the regulation of interchange fees banks charge for the use of their credit and debit cards. That change goes into effect July 1, and Sorensen said it could eliminate as much as 70 percent of the revenues banks earn from processing the transactions.

Schipper has had a close look at the process that led to the changes, which are contained in the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Schipper has been a member of the Iowa Bankers Association for the past 20 years, serving as a board member and treasurer before becoming the chairman and CEO in 2008. He has also served as a member of the American Bankers Association (ABA) and completed a term as a member of the ABA Government Relations Council.

In that role, he lobbied Congress on behalf of community banks, and he has heard testimony that convinced him that any regulations written to enforce Dodd-Frank will play in the favor of consumers.

During trips to Washington, D.C., over the last couple of years, Schipper said he was told by two congressmen and a U.S. Treasury Department representative that if there are issues “between consumer protection and safety and soundness (of banks), consumer protection is going to trump safety and soundness every time.”

Protecting the safety and soundness of the state’s lenders is the main charge from Branstad, Schipper said.

He senses that there is a mood in Washington to impose price controls on financial institutions, an attitude that existed in the 1970s, when banks operated under usury caps, limiting the interest rates they could charge.

“In the last couple of years, we’re seeing a clear trend of federal price controls,” Schipper said.

In addition, small banks will find it difficult to deal with the paperwork generated by additional oversight of their operations.

Schipper said that American State Bank has considered sharing compliance expertise with a consortium of banks. The Iowa Bankers Association also provides compliance audits, but Schipper said the organization has a backlog of requests for audits that spills into 2012.

Schipper also is keeping a watchful eye on the escalation of prices for farmland. He does not believe there will be another bubble to burst, but he cautions that it is not possible to adequately collateralize farm loans.

“To make a farm loan, you have to have supporting income to service the debt,” he said. “The collateral level is almost irrelevant.”

Commodity prices are driving up the cost of farmland. Additionally, farm income has risen to the point that many farmers don’t need to borrow to finance the purchase of $9,000-an-acre farm ground, he said.

“A lot of farmers are so liquid that they don’t need to borrow,” he said.

Schipper also has introduced legislation, first proposed by Gronstal, that could control the lending spree to developers that has resulted in financial pain for banks and borrowers. It also would allow banks to extend or modify existing loans in certain circumstances.

As a banker always looking for creative products and new customers, Schipper said he understands the influx of banks into Greater Des Moines that occurred during the development boom of 2000 to 2007.

“We had our eye on entering the Des Moines market, like about everybody did five years ago, and probably the luckiest thing that ever happened to me and my bank was that we just didn’t find the right situation, the right opportunity to pull the trigger and do that,” Schipper said. “But I think all banks were looking for opportunities to diversify assets, diversify lending.”

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