While sitting at the kitchen table and reading a magazine the other day, something dawned on us: if one eats breakfast and scrolls through an article on a tablet or a phone, the touch screen gets all gooey, so a paper magazine gets strong points for meal-time reading. While it is still true that we read more on the internet than anywhere else, there is something that is lost when one picks and chooses only the things flashing by on a screen. In the case of this magazine, we sat and read for an extended time, were relaxed and left with a clean phone that could still be used. The issue was Bloomberg Business Week and it had many articles recounting what happened 5Ys ago. If you feel yourself getting all misty-eyed reminiscing about the way things used to be in banking before the financial crisis (officially began in Sep 2008), find a coworker, have them roll up that same magazine and ask them to whack you upside the head. Unfortunately, those days are long gone.
We know many bankers want to block the crisis from all memory, but that cannot happen and we all know now that regulators are leveraging "lessons learned" as they walk around banks with rolled up magazines looking for some crazy fool to step out of line. Regulators, technology, customers and bankers move much faster now as competition remains tough and the economic recovery remains unenthusiastic.
Since we cannot go back, magazines and other sources on this subject are worth reading. In the end, four standalone investment banks were considered essential for the functioning of the global financial system and by the end of Sep they had all become banks so they could receive mandatory capital infusions from the government. Had they all failed, it would have been a bit like going beyond the edge of an old sailing map where we would likely have met dragons. No matter what side of the "save" or "let them fail" side of the coin you come down on, we saw some very spooky things back then and it was probably the only way out at the time given all the moving pieces.
So as we recall the lessons of the crisis and look to the changed landscape it created, we know community bankers remain active in their communities and continue to make a strong difference no matter the competition. Sure, things are still brutal and it may take awhile to completely get back to "normal", but even if we truly are in a "new normal" as some say, good old-fashioned community banking is still needed. Customers still need help running their businesses, raising capital, paying the bills and getting financial advice. Community bankers on the ground are the best resources for small business owners to gain comfort and find solutions tailored to their needs.
Whether you would rather read a paper magazine or click and cruise around, you know that banks--like magazines--need to find areas where they can create value. Bankers have to go beyond services that the public believes should be free and expand relationships with great service. Contracting NIM and low interest rates may seem like two realities that will be around for a while, but that doesn't mean there isn't business to be done and opportunities to capture new clients or deepen existing relationships.
Keep moving forward as you test and learn new things and closely monitor what your competitors are doing. This approach will help your bank survive and thrive through the next crisis - no matter when it hits or where you read all about it.