The Daily Dividend: FMS Publications

News, notes and insights from around the industry

OCTOBER 7, 2019
FMS Perspectives: Assessing Your Financial Institution's Culture
By Hilary Collins, Assistant Editor, Financial Managers Society

Financial institutions are constantly searching for ways to increase their success and profitability, and traditional audits usually function to help accomplish this while ensuring there are no nasty surprises. However, a bank or credit union’s corporate culture is a factor that is often overlooked.

In Assessing Your Financial Institution’s Culture, FMS board member Scott Baranowski of Wolf & Company explains how cultural audits can be a useful tool in the journey toward success. Learn how analyzing areas that need reform can help financial institutions to mitigate the potentially serious effects of a bad culture and ensure a smooth road to a sound future.
 

OCTOBER 3, 2019
FMS Research: IT Priorities
By Hilary Collins, Assistant Editor, Financial Managers Society

Information technology is a crucial component of the modern bank or credit union, whether you’re protecting data or analyzing it. Our Community Mindset 2019 survey asked 400 leaders at community financial institutions to tell us how important various IT priorities were to them: here are their responses. (Percentages indicate the number of respondents who indicated this was an important priority for their institution.)

Rising concerns
Data management (79%), improving efficiency (84%) and getting more value from existing technology/vendor relationships (79%) were not only important to more than three out of four respondents – they also have consistently risen in importance over the past three years we’ve conducted our research.

Falling priorities
On the other hand, replacing existing systems (63%) and pursuing fintech partnerships (53%) have fallen in importance compared to last year. But the reasoning behind these shifts is unclear – it’s possible that many community institutions have already replaced legacy systems or found effective fintech partnerships.

Holding steady
Improving fraud/risk management (80%), adding new systems/capabilities (77%) and infrastructure improvements/core upgrades (74%) are still important priorities for most respondents, with none of these areas seeing either meteoric rises or steady decreases in interest, but remaining firmly on the to-do list.

For more insights from our proprietary research, check out the full Community Mindset 2019 report.
 

OCTOBER 1, 2019
Looking back at forward
By Hilary Collins, Assistant Editor, Financial Managers Society

We’re hard at work on the November-December issue of FMS forward – and already starting on the January-February 2020 issue as well! But as we kick off the fourth quarter, we’ve noticed some developments on the topics we covered in the September-October issue of our member magazine.

If you enjoyed our cover story on small community institutions, Thinking Small, you’ll want to read this piece from Bloomberg on how fintech companies are teaming up with small-town banks. It’s an interesting look at the symbiotic relationships between charterless fintech companies and small community institutions struggling to grow.

Our article The Workforce of the Future looked at how forces such as automation and changing job requirements are dramatically changing the workplace. Here’s how four companies are future-proofing their workforces

For those who were drawn in by our latest FMS research piece, Technology is Banking, the concept of “phygital” banking is an intriguing spin on the language of digital transformation. For strategists and financial service experts, phygital banking means a mix of physical and digital experiences: “real-time solutions with a foundation in personal relationships.”

So until November, happy reading!
 

SEPTEMBER 24, 2019
FMS Research: Technology is Banking
By Hilary Collins, Assistant Editor, Financial Managers Society

As anyone with a pulse and a smartphone can tell you, technological innovation has had a massive impact on the way in which customers interact with their money and their financial institutions. Just a few short years ago, it would have been difficult to imagine depositing a check by taking a picture of it with your phone. But now technology touches almost every decision a financial institution makes, from customer-facing services to back-office operations.

What decisions are your peer institutions making? New research from FMS sheds some light on how community banks and credit unions are tackling technological innovation. From what technology customers are using most to how budget impacts opinions on technology, Technology is Banking, offers insights into how leaders at community institutions are utilizing technology.
 

SEPTEMBER 23, 2019
FMS Perspectives: Balance Sheet Optimization
By Mark Loehrke, Editor, Financial Managers Society

While many institutions rely on a mean-variance optimization framework for their balance sheets, this traditional approach incorporates assumptions that make periodic rebalancing infeasible when it comes to considering all risks and making long-term strategic decisions.

In our latest Perspectives piece, “Balance Sheet Optimization,” Alla Gil of Straterix explains the shortcomings of traditional mean-variance portfolio optimization, arguing that a framework that incorporates high-level data and multiple forward-looking scenarios and alternatives is the better option for institutions looking to make more informed strategic decisions related to M&A, divestitures, capital raising, determining risk appetite and establishing long-term goals.  

This is one of many great articles available to FMS members in our Industry Insights area. (Not a member? Join today!)
 

SEPTEMBER 16, 2019
FMStv: A More Efficient Month-End Close
By Mark Loehrke, Editor, Financial Managers Society

FMStv: The Importance of a CECL Implementation RoadmapAre the important strategic projects in your institution getting enough attention? Or are you constantly pushing off those longer-term and bigger-picture items because your staff is bogged down by the inefficiencies of common tasks like the month-end close?

In our latest FMStv episode, A More Efficient Month-End Close, Nancy Wu of SkyStem presents a step-by-step process to automate and streamline your closing process in order to free up resources for more strategic and variable work.
 

SEPTEMBER 10, 2019
FMS Research: Sizing up the Competition
By Mark Loehrke, Editor, Financial Managers Society

Competition has been stiff in recent years for community institutions, with many banks and credit unions working hard to keep up with peers and differentiate their offerings. With that in mind, FMS went out to respondents in our Community Mindset 2019 survey to ask how competitive they saw themselves in six key areas compared to similar institutions. 

Much like the response we saw to a similar question in 2018, most institutions still believe they’re competitive with their peers across the board, with cybersecurity, digital banking and branch delivery topping the list in 2019. Overall, however, their evaluation scores were uniformly lower than the previous year, with every area showing some degree of lower self-confidence. While those top three categories only dropped by 5% each, respondents’ confidence in their institutions’ competitiveness in payment technology dropped by 9% from 2018 to 2019, in data analytics by 12% and in their appeal to younger customers by 13%.

Does this mean that community institutions are actually performing poorly? Not necessarily. These numbers could simply show that a more intense competitive landscape in 2019 has chipped away at their confidence in their ability to outpace their peers in some of these areas – and that kind of realization often acts as a wake-up call to ramp up the effort.

For more insights from our proprietary research, check out the full Community Mindset 2019 report.
 



Contributors


Mark Loehrke
Editor and Director, Publications and Research
Email: mloehrke@FMSinc.org 



Danielle Holland
President/CEO
Email: dholland@FMSinc.org 




Hilary Collins
Specialist, Publications and Research
Email: hcollins@FMSinc.org