BID Daily Newsletter Archives
According to the National Day Calendar, today is National Sardines Day. You may not run out to get sardines for lunch, but it could be fun trivia to share. While sardines may swim in the same direction to stay in their schools, we are finding people more easily break away from their surroundings with the right incentive. It's no secret that the pandemic (and the subsequent remote work trend) is shifting people from urban centers to less costly suburban and rural areas, where community financial institutions (CFIs) arguably have an edge over their rivals. In fact, Pew Research...
While most of the globe has been explored, Pitcairn Island off of New Zealand, and Palmerston Island in the South Pacific are relatively uncharted territories. Speaking of uncharted territory, the pandemic definitely blew all of us off course from our plans for the year. Further, we remain in unchartered territory as we budget and plan for 2021, with trillions of stimulus dollars pumped into the economy and a continued shortage of coin. With all of this and more, CECL may not have been top of mind. Yet, it is still coming. For most non-SEC filers, CECL starts in 2023. To...
According to a FastTrack 360 survey, 71% of executives reveal that employee engagement is critical to their company's success. While this may be obvious, it may be a good time to review a few ways that financial institutions are keeping employee satisfaction high, especially these days, and compare with your own.So, we decided to share some of the best practices of the 85 institutions that made American Banker's list of "Best Banks to Work For" as provided by the CEOs. Communicate frequently. Reach out to your employees regularly, particularly those working remotely. Email frequently, hold video conferences, conduct regular "pulse"...
The barometer was first invented in the 1600s in Italy. We have come a long way with our weather tools since then, which is a good thing since our weather events seem to need them these days. Banking regulators are taking note too with a more focused look on the effects of weather and climate. The Federal Reserve's latest Financial Stability Report includes climate risk for the first time, noting "Federal Reserve supervisors expect banks to have systems in place that appropriately identify, measure, control, and monitor all of their material risks, which for many banks are...
We found out that the term "millennial" can be credited to the historians, Neil Howe and William Strauss, who used it in their book, "Generations." Yet, there are actually 30 other names for this generation, such as Generation Me and Echo Boomers.For the last 10Ys, appealing to this generation has been a goal of many organizations and countless studies have been conducted on how to engage them and win their business. After 10Ys, it's hard to pin down traits that apply to everyone in this diverse group. Yet, we are going to try to highlight a few themes that community...
When you think of Sweden, Volvo and IKEA may come to mind, but you may not think about vodka. However, Sweden is the largest exporter of vodka (Absolut), with 20.6% of total exports. France comes in second at 18.6% and Russia is third with 7.4%. Creative businesses seem to find ways to enter and even overtake international markets. While the coronavirus had originally affected international trade, it seems to be normalizing to an extent. So, it could be a good time for community financial institutions (CFIs) to prepare to serve those customers with international trade business.Firms that import or...
Ever wonder where the name, Google, comes from? It is supposedly a twist of the term "googol" which means the number one with 100 zeros, implying a huge amount of data on the search engine. Google's aspirations have certainly pivoted, along with other tech companies, as they now focus on the financial industry. Tech giants have been inching their businesses deeper and deeper into the world of banking over the past few years, and it looks like their efforts could be helped along by a recent OCC proposal. The Task Force on Financial Technology is currently reviewing a...
Did you know that Antarctica is the only continent without bees? While bees seem to have challenges reaching that continent, the Internet of Things (IoT) doesn't. This continent gets internet access via satellite systems.Considering it is so widespread, IoT is here to stay and is even growing by leaps and bounds. Of course, in the wake of the pandemic, the hands-free aspect of many IoT devices has become more appealing and is expediting its adoption. According to the firm Gartner, 25B IoT devices are expected to be in use by 2021, and Mercator Advisory Group previously found that payments generated...
A new report by UBS and PwC shows that 2,189 billionaires worldwide have a combined wealth of $10.2T vs. the previous record of $8.9T in 2017. Wealth management of that crowd would be very lucrative!While not many community financial institutions (CFIs) offer wealth management services, it may be an area to explore and worth the extra time, especially with low-interest rates and tight margins. Not only could you add fee income, but you could fill additional needs of your current customers and make their relationship with you even stickier. With that in mind, we bring you three proven ways to...
Glaucoma damages the optic nerve and leads to blindness. Luckily, many of us get annual eye examinations which are vital in its detection. Another type of examination - the regulatory kind - is also important and the pandemic has created additional exam questions. We help you address them.You and your peers have been doing all you can to help customers who have been hit hard financially. While you have followed all procedures and guidelines, it has been an unpredictable time when your customers needed a little extra help. While regulators have signaled that they would not automatically adversely rate COVID-related...
In 1916, the first Uniform Small Loan Law allowed up to 3.5% monthly interest on loans of $300 or less. From there, two-thirds of states implemented similar versions of it. While these loans have not often been embraced by FDIC-insured financial institutions (FIs), this sentiment may be changing.Most recently, Bank of America made headlines with the announcement that it was getting into the payday loan market. Customers can now borrow up to $500 (in increments of $100) for a $5 flat fee regardless of the amount advanced to their account. Digital bank Varo, followed suit shortly after, announcing...
According to Bain & Co., bumping up customer retention by only 5% can boost profits by 125%! That is a good reason to re-examine your loyalty programs to ensure they are still relevant.These days, loyalty programs are pivoting to include pandemic-specific customer needs. Instead of a regular shopping or dining discount, some are offering freebies like free delivery instead. The popularity of loyalty programs has never been higher. A recent study by daVinci Payments found that 97% of American adults now participate in loyalty programs. Furthermore, another study found that nearly nine out of 10 bank customers in...
Do you know which planet was the first to be discovered with the telescope? If you guessed Uranus, you are right. Not all questions have one right answer though. Today we bring you our thoughts on three questions provided by bankers that you may find of interest regarding women and minority-owned businesses, mobile-first credit cards, and remote employee feedback. Q: Women and minority-owned businesses face special challenges and it's even more of an issue during the pandemic. What are some things our institution can do to help them?A: There's a long-held attitude among many of these businesses that they will...
NASA has evidence that it could rain glass on a planet named HD 189733b. That would be a little stressful for the inhabitants, if there were any. On Earth, many people have lots of other forms of stress right now, including financial stress.During this unprecedented time, your customers are likely feeling a great deal of anxiety, and it's not just about whether they could contract COVID-19. The American Psychological Association finds that 70% of Americans are stressed out about the economy and work. Many small business owners are concerned that they may have to significantly curtail operations (again). Even if...
What do dentists and community financial institution (CFI) branches of the future have in common? More than you may first think.Today's bankers might not think of dentistry when contemplating the business model of their branches. But in fact, the professional office model, in which specialized, one-on-one service is provided by appointment, might well be the way more branch client service is handled in the future.As Mike Carter, executive vice president of advisory firm Strategic Resource Management said to S&P Global Market Intelligence in the summer, "In the future, the bank branch will be a lot like going to the...
In 1777, Frederick the Great gave an official statement advising everyone to drink beer instead of coffee. He was raised on beer-soup and thought it was much healthier than coffee. Some official statements are more reasonable than others; we cover two of those (proposed rules) today.In an earlier article, we discussed the flexibility that banking regulators are providing. Today, we cover proposed rules by the CFPB and FinCEN that are looking for comments.CFPB and lending to minority and small businesses. Under Section 1071 of the Dodd-Frank Act, the Consumer Financial Protection Bureau (CFPB) is required to specifying how...
At the end of 2019, popular payment apps included Tabbedout, LevelUp, and Mint. Meanwhile, DoorDash and GrubHub have become more widely used lately. There is a lot to keep track of these days with payments. We know that you are watching these fast-moving trends to see how they develop and how they could affect your customers. To help you out, we bring you some highlights from The Strawhecker Group on a number of payment-related trends: Contactless payments. This had been an area of growing importance before the pandemic, but hyper-sensitivity to contact has only made the movement in
Apparently, the average American eats between 3,000-5,000 calories during Thanksgiving dinner. Hitting the 5,000 calories may be something some of us would like to avoid this year! There are things to avoid when working on technology development too.Not unexpectedly, over half of financial industry C-suite executives and senior management want to put new technologies into place in the near future, according to a July survey by Broadridge Financial Solutions. These days there are many ways to provide technology products to your customers. That can make it difficult. To keep your customers happy and stay on top of the
Weirdly, instead of "cheese", Victorians said "prunes" when getting their picture taken to mimic a smile. Hearing that regulators are willing to be flexible might make a few bankers smile without either "cheese" or "prunes."Michelle Bowman, a Federal Reserve Governor, during her speech at "Community Banking in the 21st Century" indicated that community banks supporting customers in good faith during the pandemic can expect flexibility from banking regulators. In its supervision of community banks, the Federal Reserve recognizes that it needs to balance safety and soundness on one hand, with the role of filling critical financial needs on
According to one study, sarcasm promotes creative thinking. So, what are you waiting for? These days, however, it will take more than creative thinking to stay on top of the CRE market. KPMG reports that 68% of corporate CEOs expect to reduce their office space. In addition, new firms created during the pandemic have been designed around a remote workforce with a smaller physical footprint. Meanwhile, small businesses are still struggling as forbearances are coming to an end, creating further pressure on landlord cash flow. Eric Rosengren, president and CEO of the Federal Reserve Bank of Boston,
Not surprisingly, the US has the highest rate of early-stage entrepreneurship (15.6%) in the developed world, and 87% of early-stage business owners expect to add employees. They are an important part of the economy. But, a global pandemic hasn't made things easy on them. Still, many entrepreneurs are actually starting new businesses.According to a recent JustBusiness survey, one in five entrepreneurs have identified new business opportunities and set out to launch them since the virus outbreak -- half of whom are first-time entrepreneurs. Not surprisingly, roughly a quarter of the individuals trying to launch new ventures are people
Some of the silliest college mascots we have heard were: a pickle, an artichoke, and a slug. But, trying to pay for a college education is far from silly and Google is attempting to provide an alternative with its new certificate program. The tech giant recently introduced its new Google Career Certificates program which is sure to make educators sit up and take notice. But, it could also have ramifications for community financial institutions (CFIs) as they continue servicing their customers and look for talent.The value of a college degree. With higher education costs soaring with seemingly no end in
According to The Brookings Institution based on the most recent Census Bureau data, almost 40% of Americans under the age of 16 are Black, Latino or Hispanic. While they may not be business owners yet, it may not be long before they think about their future and the opportunities of a business owner.Even today, communities of diversity offer sources of new customers for many community financial institutions (CFIs), and many of these business owners are still struggling through this pandemic. Consider the PPP loan program, which has been a lifeline to many small businesses. But Black and Latino
In the 1500s, monks noticed an explosion on the side of the moon. This was most likely a meteor "merging" with the moon and leaving a huge crater as its mark. Some mergers definitely have a greater impact than others. In that vein, the Department of Justice (DOJ) is conducting a wide-ranging examination of its bank merger antitrust review policies, and the result could favor smaller banks. Changes under consideration could allow smaller bank mergers to move forward without full antitrust reviews. Such a change could have the effect of removing the DOJ oversight of many of these
Did you know that sea cucumbers eat with their feet? Sometimes things can be a little upside down, especially in today's world. But, to ensure that this is minimized, bankers are having tough conversations with their borrowers. This is one of the things we heard in our recent conversations with our client community financial institutions (CFIs) on how they are approaching lending, as the pandemic continues. We would like to share some of the highlights of these conversations. Existing customers. Many lenders are focused on existing customers, to ensure that their institution maintains a fairly stable loan portfolio base. With
Amazon, Walmart, and Target are names that come to mind for one-stop shopping. People want simplicity and one-stop shopping. Now, paying bills can be done in one-stop. Have you considered this for your financial institution?The world of banking has become increasingly mobile, particularly with many first-time users embracing electronic payments during the pandemic. It is no longer sufficient to just offer straightforward online bill payments. Many fintechs and other merchants now provide aggregated bill payment offerings using electronic bill payment and presentment (EBPP) technology. This provides access to detailed invoices from multiple merchants or service providers. It offers flexibility
You probably didn't realize that it is National Yorkshire Pudding Day. If you are not sure what it is, we looked it up. It is a popover of baked unsweetened egg batter eaten as a side dish, often with roast beef. Not everyone may be looking for Yorkshire pudding, but it is nice to have it as an option.Similarly, it is nice to have lending options for your customers. As the pandemic slogs on, you may be looking to bring in more business and continue helping your customers, especially those that may have been too big for the Paycheck Protection
We thought it interesting to learn that continental plates can drift as fast as our fingernails grow, which is 20x faster than first thought! Speed is on everyone's mind with payments these days, and the research is clear: US consumers and small businesses want faster, secure payment options. To that end, more options are on the way. We give you a quick update on real-time payment solutions and why it is important for community financial institutions.Faster payments options. The Clearing House and Zelle have already launched real-time payment services. These are used extensively, mainly through the big banks and consumers
The computer password was created in 1960 by Fernando Corbato of MIT. Its original intent was to keep individual files private, while users worked on them. Fast forward 60Ys and the idea of private information has expanded exponentially. Despite decades of advancement, the primary form of security for many bank employees is still the password. Furthermore, with many bank employees working from home in recent months, the potential risks of basic password security are becoming more evident. With so many personal and professional sites and networks requiring passwords, most folks on average have to remember at least 90 passwords. Because
Did you know the unicorn is the national animal of Scotland? This is due to its importance in Celtic mythology. Sometimes you don't find things out if you don't ask. In that spirit, we provide you with some of our readers' questions and our insight in addressing them. Q: With all that's been going on, might it make sense to buy back stock?A: We've seen several recent share repurchase agreements, which could be for a number of reasons, including the desire to offset lackluster demand. Plus, with many bank stocks trading below tangible book value, buying back shares can be
Trivia Nights became popular in the '70s, yet they have had a resurgence. In fact, two OH bartenders turned it into a $1.5MM business in 2019! Talk about having a good idea and running with it! There are many businesses with good ideas that are now on hold, but that may be changing.The pandemic has been a difficult time for millions of businesses. Yet, recent data is pointing to increasing business optimism. A rising index. After three consecutive quarters of declining optimism, small-business owners are feeling more positive, with increasing expectations for the future. In August, the NFIB Small Business
Many of us have heard that young kids can't remember a lot before age 3. This is called "infantile amnesia" because the hippocampus (in charge of episodic memories) is not fully developed until after 3Ys old. From then on, they learn and grow quickly. Yet, the current pandemic has shifted some of their learning environments quite a bit. Limited child care has become a serious issue as workers try to return to the workplace. A recent Federal Reserve Bank of Philadelphia survey found that nearly half of the manufacturers in that region had difficulties recalling furloughed workers or hiring new
Since Halloween is coming this month, we thought we would check on the heaviest pumpkin recorded last year. That honor goes to a 2,517 lb. pumpkin grown in NY. As you think about that relative to your own front porch jack-o-lanterns, we bring your attention to some of the latest ag trends.While many farmers have planted crops the same way for years, some are coming up with innovative business solutions and pivoting crops according to demand. This means they will need you more than ever. So, we not only lay out some of the current trends, but also give some
Gallup reports that 70% of US employees stated they were working from home at least partially in May. This number surged from 7% prior to the pandemic. Needless to say, with teams spread out remotely, leading the workplace has changed dramatically in the last few months.Today, success with a remote workforce depends a lot on your employees, but predominantly, it depends on your leadership skills in managing a remote team. While we know you have been working on this for a while now, we thought we would share five tips to continue employee engagement and encourage higher productivity. Communicate. Schedule
Newton's third law states that for every action there is an equal and opposite reaction. So, it should come as no surprise that as mobile banking usage has soared since the onset of the COVID-19 pandemic, so too has mobile banking fraud.According to a report from the Federal Bureau of Investigation, mobile banking activity increased by 50% in the first five months of 2020. Add to that the stimulus checks that were mailed out to people as part of the CARES Act, and a large portion which were deposited remotely. These are all facts not lost on cyber
Did you know that baby sea otters can't swim right away? Their moms wrap them in kelp to keep them buoyant until they learn to swim on their own. It is nice to get help when you need it most and community financial institutions (CFIs) have always been good at giving help to their communities. In fact, CFIs are masters of community involvement and thanking their customers. During these challenging times, it is even more important. So, we wanted to highlight some of the creative ways that we have heard some CFIs are doing this. You may get some good
Poland has a crooked forest where hundreds of trees bend at a 90-degree angle and point north. Sometimes you may have to make a turn to get where you need to go. As the pandemic lingers on, CFOs are making a turn or two as well, with automation. Many are rethinking how best to manage their needs, both short-term and long-term, and finding automation can help. We provide some insight from a new report from Tipalti, "Rebooting Finance Teams for the Robot Revolution." as you consider automating some finance processes with your teams. Day-to-day management during the pandemic. Only 14%
In August, a Swiss town experienced "chocolate snow" with a malfunctioning ventilation system at the local chocolate factory. Having chocolate falling from the skies could lure some potential employees into a community. However, you may want to consider some more practical options to engage your Gen Z employees (those born 1996-2015). Yesterday, we discussed Gen Zers as business customers . Today , we discuss how to engage Gen Zers for recruitment and employee retention. Already a force to be reckoned with, they currently account for 68MM US adults. By 2025, these young people will represent one
"Drip" and "glow up" are adjectives used by Generation Z meaning wearing expensive things and looking better than before. If you don't know these words, you may want to change that as this generation is becoming more important.Gen Z, people born after 1996, has often been overshadowed by the huge and powerful millennial segment. But, coming into their own in an age of mobile access and social media, this generation will likely exert a noticeable impact on the financial world, especially as businesses. They will soon represent the largest US consumer population. Currently, Gen Z constitutes 40% of the market
The Fed reports that it costs 19.6 cents to print the $100 bill and that a missing watermark and security thread are the best ways to detect a counterfeit bill. That is comforting to bankers. But with cryptocurrency being used more these days, bankers will face new challenges and need to rely more heavily on regulators for guidance, if they decide to go down this path.The Office of the Comptroller of the Currency (OCC) recently published a letter clarifying national banks' and federal savings associations' authority to provide cryptocurrency custody services for customers. While banks now have the
The Hass avocado is named after a CA mailman, Rudolph Hass who patented it in 1935. If he gets royalties on every Hass avocado sold, he really had a successful strategic plan!These days, it is not as easy to create a successful strategic plan. Most financial institutions build annual strategic plans by updating those from the year before. Yet, with the arrival of the pandemic, strategic plans will need more scrutiny than previous years. This year's strategic plan will require new approaches, tactics, and priorities that help your institution move forward in a world in which everything you knew six
Time-off requests have plunged 25% as vacation plans were dashed and uncertainty remains around the coronavirus. Last year in July, there were just over 70.3K vacation requests from employees at 3,000 companies. This year that number fell to around 52.7K. Not only has the pandemic pulled many away from their vacations, but it has also pulled financial institutions away from their post-LIBOR plans. Many bankers may hope or expect that regulators will still push the LIBOR deadline. Yet, regulators on both sides of the pond have been clear that their December 2021 deadline to transition away from LIBOR is a
Various sources report that the raccoon is the mascot for 2020 -- it wears a mask, compulsively washes its hands and if you leave out one "c", its letters rearranged spell "corona." As you chuckle at this idea, we bring your attention to one specific area affected by the coronavirus, employee onboarding.Physical distancing and remote working don't seem to be going away anytime soon due to COVID-19. So, as community financial institutions resume and step up their hiring, they need to accommodate these situations. This can be challenging as you need to not only onboard through remote channels, but also
Thai Airways has grounded flights due to the coronavirus and is awaiting bankruptcy protection approval. In the meantime, trying to make lemonade out of lemons, the airline - known for its high-quality cuisine - decided to open a theme-based pop-up restaurant that serves 2,000 meals a day! Similarly, customer complaints are no one's idea of fun, but, you can make lemonade out of lemons here too. These may provide warning signs of problems with your institution's compliance and risk management. A strong complaint-management program can validate inherent risk, ensure control effectiveness, identify compliance and operational weaknesses, and help your institution
As far as we know, the first drive-up window teller was at Grand National Bank in MO in 1930. Fast forward 90Ys and we are seeing a resurgence of this banking channel. For some time, experts have been telling bankers that branches are undergoing profound changes and that the old ways of transacting business need to be reimagined. Yet, the experts never expected COVID-19, which has brought back one of the previous staples of branch banking: the drive-through teller.The Revival of the Drive-Through Teller During COVID-19Across the country, drive-through tellers are making a comeback. Customers are responding strongly to
While it is hard to pinpoint the exact temperature of the earth's core, it is somewhere between 7,952 degrees Fahrenheit and 10,800 degrees Fahrenheit. Either way, it is hot in there!Another core that has been a hot topic lately is core providers. As most financial institutions (FIs) implemented more technology amid the pandemic, a growing number are looking outside their core provider for these services. More and more FIs have been casting a wider net for technology services in recent years, which Bank Director's annual technology survey illustrates. Only 41% of respondents said they depend on their core
In Colombia, dried ants are the typical movie theater snack, not popcorn, and they cost a whole lot less. When you are managing your liquidity, that is important. Liquidity management is always important for bankers, but especially during times like these. In addition to that, the government stimulus has created a situation where financial institutions are suddenly flush with liquidity. Yet, this is likely only for the short term, as circumstances start to change. As such, it is imperative to stress test your liquidity risk. You may be comfortable with liquidity risk, but it could still be helpful to
Antarctica has hurricane-force winds every three days! Yes, it is considered the windiest place on earth! Luckily, most of us don't have to deal with those conditions. But still, disasters seem more prevalent in our neck of the woods these days. Wildfires in the West. Tornadoes in the Midwest. Hurricanes in the Gulf of Mexico and the Atlantic Coast. Natural disasters seem more frequent and community financial institutions (CFIs) seem to find themselves on the frontlines of disaster response more often. Now might be the time to review your plans. As you prepare, we bring you some timely reminders. Fine-tune
Interesting fact: not only can people be allergic to cats but cats can be allergic to people. This is not often the case since our bathing habits are usually more rigorous than those of most cats.Another area covered more rigorously these days is expenses. Bankers are looking for all ways to tighten the belt including contemplating job cuts. When the pandemic and economic slump first prompted widespread job losses, banks were among those most likely to maintain employment levels. Indeed, a number of banks and financial, institutions, including Citi, Wells Fargo, and Bank of America, pledged not to
Did you know that a bottle of wine consists of around 700 grapes? Think of all the fruit you are drinking the next time you have a glass of Chardonnay or Pinot Noir! Just as wine has a lot of grapes, Google Play Store and iTunes have a lot of apps and they are increasing every day. According to Statista, about 40% of community banks had a mobile app in 2018. Since this was 2Ys ago and pre-COVID-19, we believe this number is a bit higher today. So how do you stand out amongst the thousands of banking apps out
John Lloyd Wright, Frank Lloyd Wright's son, invented the toy, Lincoln Logs. Remember those? While new inventions can increase your profitability, so can cutting costs.These days, many community financial institutions (CFIs) are finding that staying profitable involves cutting costs. To that end, bankers are looking at potential places to trim expenses. We cover two big areas that can help.Digital banking. The pandemic has made some potential cost-savers clearer than others. Some CFIs were already shedding branches, but an uptick in digital banking, plus a mostly successful move to remote working for some, may push some CFIs
Coca-Cola was the first soft drink consumed in space. Pepsi came eight hours later. Still, Coke's performance looks better in this case. While not up in space, we definitely are experiencing a new set of circumstances. How are your employees performing through it all?We are now six months into remote working, and it is unlikely that is going to change anytime soon. This type of work practice has now become the "new normal" and businesses, including community financial institutions (CFIs), may need to review and adapt the way they assess their employees' performance under these conditions. Not only that but,
Did you know one of the differences between alligators and crocodiles is that crocodiles can't stick out their tongues? Strange and fascinating. But, we wonder what methods were used to test this fact! Before you dig too deep into that, we bring up Regulatory Technology (RegTech) as a method used by some bankers these days to stay compliant. With ongoing regulatory demands and faster payments, financial institutions (FIs) have become more focused on efficient and effective regulatory compliance methods. For this reason, it's little surprise that RegTech has become one of the most popular subsets of FinTech development. FIs know
According to the National Highway Traffic Safety Administration, around 530k crashes are caused by improper lane changing and merging. Just as improper traffic merging can have its consequences, bank mergers without the right elements can quickly sour these days.The pandemic has been tough on bank M&A activity, particularly for the megadeals that headlined banking news last year. Through the first seven months of 2020, the number of bank deals dropped by almost two-thirds, while the total value plunged by more than 80%. The first seven months of 2019 saw 150 announced deals worth $43B. But just 56 deals were announced
Do you know why the average house cat sleeps about 16-20 hours a day? We found out from PetMD that even house cats are "hardwired like big cats" so they need to rest up in case they need to go "on the hunt." In today's Inquiry & Insight issue, we have some banking-related questions to answer from some of our readers, which we thought you might appreciate. Q: The pandemic is forcing financial institutions to rethink their security plans. What are some different approaches we could consider to mitigate threats?A: With more staffers working remotely, financial institutions (FIs) have
The word "toxic storm" may conjure up images of hazardous materials, negligent compliance, and bad weather. Luckily, that doesn't seem to happen often. But, when a member of the Federal Reserve uses the phrase "toxic storm", our ears perk up.A policy analyst at the St. Louis Fed used those words to describe the precarious financial situation millennials are facing. Today, we share some relevant data on this group as well as some strategies to help your millennial customers survive and even thrive. The St. Louis Fed laid out three reasons why COVID-19 could prove a more difficult setback
Experts believe there could be as many as 760MM mobile contactless payment users worldwide by the end of this year. Faster payments are a big deal and the Office of the Comptroller of the Currency (OCC) recently made a move in this area. The OCC is set to introduce a special purpose payments charter for nonbank payment processors and fintechs -- a move that bank and credit union trade groups strongly oppose.Payments Charter 1.0, slated to launch this fall, would be akin to a national money transmitter license that preempts state licenses, according to Acting Comptroller Brian Brooks. About
The New York Times reported that the movie "b" will feature the "first fully autonomous artificially intelligent actor," Erica. She was created by a Japanese roboticist and she is practicing lines with local actors, awaiting production to start. Artificial intelligence (AI) is not only being utilized by Hollywood, but also becoming more widely used in the financial industry too. Fraud detection and online customer engagement are a few ways. Some are also using it to help make better credit decisions and to reduce racial and gender bias. While the use of machine-learning algorithms within AI decision-making systems may not completely
A mature leafy tree makes as much oxygen seasonally as 10 people inhale in a year. With as many as 6MM trees on average planted in the US each year, that is a lot of oxygen! Trees sure are useful. Another tree many companies use is a decision tree. Today we discuss how these decision trees can help your customers.Many banks construct decision trees to help their employees solve customer problems. If the problem is A, do this. For a problem in category B, do that. You reward them when they help a customer quickly. But by doing this, are
Did you know that baby porcupines were called porcupettes? Even as babies, they can be prickly. Another area that could be prickly is PPP follow-up, including forgiveness and extensions. As of August 8th, the SBA reported that over 5.2MM loans have been made through the Paycheck Protection Program (PPP). While bankers have worked hard to meet their customers' needs with these loans, more hard work is still ahead of them.Somewhat lost in the chaos of the current COVID-19 pandemic is the fact that many lenders are also looking at renewals, extensions, and new loan requests from their borrowers. The
The longest skateboard trip was over 7.5K miles, according to the Guinness World Records. Before you think of dusting off your own skateboard and giving it a whirl, we discuss another kind of board -- digital account onboarding.There has definitely been an increase in digital account openings during the coronavirus. Some customers need new accounts for their stimulus checks while others may be trying to build up their "rainy day" fund since it has been pouring lately. Digital bank, Chime, reported having record account openings during the first couple of months, and as the crisis keeps going, online account activity
During his lifetime, Vincent Van Gogh only sold one painting for the equivalent of about $109. Not only that, but it took 20Ys after his death to be recognized as a gifted painter and get the credit he was due. These days, bankers everywhere are grappling with another kind of credit -- helping their customers through the current crisis.For the week ending August 9th, 3.6MM homeowners were in forbearance with the total number of loans in this category dipping to 7.21%, according to the Mortgage Bankers Association. While this number has decreased, the pain for some may not
The film "All the Money in the World" depicts the real-life kidnapping of one-time-richest-man in-the-world J. Paul Getty's grandson -- and his controversial refusal to pay the ransom. In the 50 years since this iconic story came to light, the issue of whether paying extortion is a good or bad idea has been hotly contested. Nowadays, extortion has moved to the digital realm. More hackers see ransomware schemes as a quick way to make cash, by gaining access to and locking up businesses' important data and systems, which they will release only when a ransom is paid. Ransomware has been
Google was founded in 1998 and 4Ys later, it was used as a verb on a popular TV show. In 2006, it was officially introduced in the Oxford English Dictionary. Now, Google is making headlines again with banking partnerships. The tech giant plans to offer digital bank accounts through Google Pay, offering budgeting tools via an FDIC or NCUA-insured account. Recently, partners include community banks, marking an expansion of earlier agreements with a large multinational bank and a credit union. On the one hand, it's another example of tech giants honing in on traditional bank territory. Apple recently introduced a
Many young adults want independence. But, it is especially hard these days. TD Ameritrade recently surveyed young millennials (24-29Ys old) where 57% say that the coronavirus has largely affected their financial independence.Similarly, many community financial institutions (CFIs) are trying to hold onto their independence. While some may be turning to mergers to increase stakeholder value, others still want to remain independent. It may be tough during a pandemic, but it can be done successfully. Having the right strategies in place can increase the strategic importance of independence for your shareholders, customers, and community. Here are some key strategies to start.
As of this month, 3.5B people worldwide use smartphones. That equates to 44.85% of the global population. It is no wonder that technology advancements are demanded these days, which keeps financial institutions (FIs) busy investing in technology. According to research conducted by AT&T and IDG, 81% of FIs have made technology changes at the corporate and/or branch level in recent years. Now, 5G will likely be a part of that technology upgrade. Telecommunications companies like AT&T and Verizon have already begun rolling out new high-speed 5G network technology in some parts of the country -- and this will affect financial
Did you know that pinball and dancing used to be illegal in some states? Sometimes, crimes can be re-evaluated for their effects on society. Similarly, the FDIC recently decided that certain individuals who committed trivial crimes in the past should have the opportunity to work at financial institutions (FIs). This change Could expand the pool of eligible banking employees, and that could be particularly helpful for community financial institutions (CFIs). The recently finalized change means that individuals who were convicted of small crimes in the past won't be automatically blocked from job openings at FIs, or be forced to go
While bears and tigers often top the list as the most dangerous animals, so do human beings. It is not surprising then that bankers need to take extra precautions these days trying to ensure bank security.A financial institution's first retail delivery channel has always been the branch. Even though digital banking has surged lately, the branch remains in many ways the best way for bankers to connect with customers. But keeping branches secure has become a bit more challenging, with some of the effects of COVID-19, such as face coverings and physical distancing.Here are a few tips for how CFIs
According to a Harvard study, 55% of Americans were more stressed in May than in January. COVID-19 has really stressed us out...even bankers, as they work on their stress testing. All bankers are busy stress testing their loan portfolios, to find out the potential effects of COVID-19. Getting a quick assessment is invaluable to see how loan losses will affect capital. In addition to loan portfolio stress testing, liquidity stress testing is also imperative. Combining liquidity and credit stress testing provides a more complete picture around your institution's resiliency.Liquidity depletion. Most bankers have experienced a rise in liquidity given the
According to Bobby Flay, the ideal grilling time for a medium-rare burger is four minutes on one side and 5 on the other. We know that there are a lot of burgers being grilled this summer. But, there are other fun things to do even with the limitations of COVID-19. So, today we thought we would offer some creative ways to help de-stress customers and employees during these unprecedented times. Drive-in movies. One idea is to host drive-in events for community members, making sure of course, to comply with applicate state and local laws. Consider, Walmart's announcement that it would
In a study by the Fetzer Institute, 62% of Americans reported that they needed more forgiveness in their personal lives. Small business customers also want forgiveness -- of their PPP loans. Recent changes to the Small Business Administration's Paycheck Protection Program (PPP) will help more small businesses get their loans forgiven -- but it also leaves community financial institutions (CFIs) on the hook for longer, meaning extra costs and a growing administrative burden. Are CFIs better off keeping the loans and associated work in-house, selling the loans now and letting someone else deal with the hassles, or hiring a vendor
Pandemics are not new. There have actually been five in the past 100Ys, the Spanish Flu, Asian Flu (H2N2), Avian Flu (H3N2), H1N1, and now COVID-19. Still, this one has caused a lot of suffering, physically, emotionally, and financially. One group that is especially vulnerable financially is the unbanked.COVID-19 has encouraged more online purchasing, a catalyst for more cashless payments. Many stores have become cashless too, to keep their employees and customers safe by eliminating currency as a possible transmission source. Yet, the unbanked mainly use currency for purchases and so this shift has limited their purchasing opportunities.According to the
The first online review site, Epinions, started in 1999 and was bought by DealTime (shopping.com) in 2003. Since then, sites such as Yelp, Angie's List, and Google have added customer reviews to their sites.Due to COVID-19, customer review sites have expanded the information provided, from product quality and customer service, to include sanitation and safety efforts taken by businesses. Community financial institutions (CFIs) can use these sites too, to capture the steps they are taking in their branches and communicate with their customers.Given consumers' heightened interest in the risks associated with venturing into publicly accessible spaces, Yelp has expanded the
According to the Washington Post, there are 3,134 Main Streets in the US. That number has been declining, but the Fed's Main Street Lending Program (MSLP) may help.GDP recorded a record slide in the second quarter, shrinking at a 32.9% annual rate. As the economy continues to struggle, small businesses continue to grasp for help. While many bankers have helped businesses get funds through the Paycheck Protection Program (PPP), one government program that hasn't gotten as much attention is the MSLP. But, that may be changing.Both programs are aimed at helping small- and medium-sized businesses obtain financing. Yet a key
Something we found surprising is that Queen Elizabeth is a trained mechanic. While you ponder that strange fact, we hope you don't find the transition from the London Interbank Offered Rate (LIBOR) surprising.LIBOR's days are numbered, as the clock continues to tick towards its December 31, 2021 expiration. Though COVID-19 has turned the focus to a myriad of new challenges, there has yet to be an announcement delaying the transition. If community financial institutions (CFIs) want to ensure they are aware of their total LIBOR exposures, they need to continue moving forward with their transition plans. COVID-19 has definitely changed
La Paz, Bolivia is the capital city at the highest altitude worldwide -- 11,942 feet. While you likely aren't planning any South American trips in the near future, we thought this was interesting trivia. But, now we bring you back to the US to review findings of a new report by Deloitte. This report projects US commercial banks' balance sheet and profitability over the next 5Ys. These findings and our insight could prove helpful as you begin the strategic planning season. In Deloitte's baseline scenario, to which the firm attaches a 70% probability, recovery won't kick-start until mid-2021.
The most popular desserts in the US are: chocolate chip cookies, apple pie, cheesecake, pecan pie, carrot cake, and ice cream. It is likely that at least one of these dessert offerings is making your mouth water. So, while you ponder your next sweet treat, we provide you with some information on setting up another type of offering: Banking-as-a-Service (BaaS).BaaS is an end-to-end process that allows financial institutions to provide more services through application programming interfaces (APIs) with third-parties seamlessly. BaaS not only provides customers with value-added services, but could also create a new revenue source for your institution. One
Does anyone remember the days when a phone call at a phone booth cost only a dime? Well, today -- if you can find a phone booth -- that call would cost 50-75 cents. Not only has the cost gone up, but coins are hard to find too.It's not that all the coins have vanished. The US has around $48B worth of coins in circulation. In a normal year, the US Mint might make as many as 12B new coins. But then, things changed due to COVID-19. Between January and May 2020, the Mint made about $4B in new coins,
Q: Which is the most curious letter? A: Y? Ok, so that joke was a little goofy, but we wanted to get you into the mood for our latest Inquiry & Insight issue. This monthly issue allows us to address questions from our readers and provide you with some possible points of discussion as you begin your day.Q: We're considering a new compliance management system. What are some of the considerations?A: A good first step is to understand how much you're spending on compliance. To help in this effort, banks could consider a tool developed by ABA to