A Trusted Advisor to Financial Institutions

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  • March 2017
    • 15&16: Georgia Bankers Association: Technology Conference, Atlanta
    • 20: GSB at the University of Wisconsin: IT Management School
  • April 2017
    • 4: Oklahoma Bankers: Management Conference, San Diego
    • 5: Ohio Bankers League: Technology Conference, Columbus
    • 7: Webinar: Community Bank Strategies
     
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    2017 Banking Outlook

    Welcome to 2017! I trust that you and your family had a great holiday season. Getting back to business, I have some thoughts on evaluating your banking and enterprise strategy to begin the year. I hope you’ll enjoy this new, easier-to-read newsletter format. This is just one of a few In this issue, I offer 5 areas of focus for 2017 and beyond:

    Governance and Regulation Awareness
    Cyber Security Training
    Productivity Enhancements
    Virtual Banking
    Emerging Trends

    JANUARY 17 – ISSUE #1
    Trent Fleming

    Welcome to 2017! I trust that you and your family had a great holiday season. Getting back to business, I have some thoughts on evaluating your banking and enterprise strategy to begin the year. I hope you’ll enjoy this new, easier-to-read newsletter format. This is just one of a few In this issue, I offer 5 areas of focus for 2017 and beyond:
    Governance and Regulation Awareness
    Cyber Security Training
    Productivity Enhancements
    Virtual Banking
    Emerging Trends

    In the News
    Here are links to my most recent publications:

    Is Your Bank’s Board of Directors Prepared for the Future?
    THEFINANCIALBRAND.COM – Share
    The role and composition of a financial institution’s board of directors must reflect the changes sweeping across the banking industry.

    Trent’s Comments: In Defense of Legacy Core Systems
    BANKINGINSIGHTS.BLOGSPOT.COM – Share
    As the on-line complement to my very popular “Trent’s Comments” newsletter, this blog will serve as a way to access the entire newsletter, as well as timely matters of interest in between newsletter offerings.

    And here I am, quoted in Euro Money Magazine about the Wells Fargo Investment Bank:

    Wells Fargo’s investment bank takes a hit /Euromoney magazine
    WWW.EUROMONEY.COM – Share
    Clinging on to modest IB ranking; municipalities show their clout over ethics scandals.

    Corporate Governance and Regulation Awareness
    Increasingly, we find that the regulators are expecting broad attention to overall management of your organization. Directors and executives are expected to be aware of, understand, and provide direct oversight of key issues involving the organization, no matter how technical or esoteric. This ranges from Cybersecurity (more on that later) to new investment vehicles. Effective corporate governance demands a more educated and involved board. Tip: plan for ongoing director education and training on all areas of the organization. Leverage resources from your state and national trade associations, your vendors, and your advisors: attorneys, CPAs, and yes, even consultants.

    Cyber Security Training
    Heard enough about this yet? Here’s the reality: CyberSecurity is a critical business issue that is here to stay. Going forward, every decision you make will involve some element of managing IT security and risk. Innumerable hackers worldwide are spending their days and nights seeking vulnerabilities to exploit, across all types of organizations. You are not immune, even in rural community banks. Tip: training and awareness remain a key first line of defense. In particular, you will find that employees – rather than customers may be your weakest link. In evaluating cybersecurity incidents, we find too often that an employee facilitated the attack by letting their guard down and clicking on what should have been a suspicious email. So training starts with employees, and extends to customers. Second, be sure that your discussion of new and renewed vendor relationships (of all types) includes addressing cybersecurity issues.

    Productivity Enhancements
    All of us are keenly aware that we are not getting the levels of productivity we expected when the automation age began. Recently, commenters including Randall Forsyth (Barron’s) have lamented the lack of productivity in American industry. In my experience, this stems largely from an underutilization of resources, which in turn stems from a lack of training. Tip: two simple steps to better productivity. First, manage your people well. Ensure that the fundamental steps for better HR practices are in place: clear communication of expectations, proper training for the tasks at hand, and quick feedback, both positive and negative, for on the job performance. Train your managers to manage. Second, address utilization of your key systems. Work with your software vendors to understand the tools available to help your people use the software you’ve invested in.

    Virtual Banking
    It is past time to prepare for this. My definition of virtual bank is the sum of all customer activity outside of your traditional branch network. I suspect that if you took a look at the transaction levels, you would find that this “virtual activity” (mobile, phone, Internet, ATM/Debit) has already exceeded branch transactions. Since this now represents a significant part of your customer activity, it is time to address and actively manage it. This includes developing or further building out a call center capability, developing support for remote delivery channels, and preparing for the next generation of branch delivery (ITM, video teller, self-service)
    Tip: identify the current volumes of activity by transaction type, and establish a “virtual branch manager” position within the bank to begin overseeing this. Provide key guidance about expectations and goals for the virtual branch, as well as bank-wide education to help employees understand the mission.

    Emerging Trends
    Ok, not really trends, but a trend. You will increasingly see reference to Artificial Intelligence as it relates to business matters. Do not dismiss this. The selective use of artificial intelligence can dramatically improve many of your processes, from reporting, to loan applications, to personnel management. Look for opportunities to leverage AI offerings from your vendor to improve how you do business. Tip: better management information from your data is available by allowing advanced reporting systems (which will increasingly use AI) to provide you with insights you will otherwise miss. Remember that by processing customer transaction activity, you have access to better information about that individual or business than any one else can easily have. Leverage that information to better serve and cross-sell to your customers.

    One Response to 2017 Banking Outlook

    • Thanks for the kind words. It’s scary to think how many more small business owners would be getting their financing if they thought about their credit as an asset! The bottom line with credit is preserving it if it’s already excellent and improving it if it’s not where you want it to be.

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