The Daily Dividend

News, notes and insights from around the industry

APRIL 23, 2018
Digital Banking Trends  Globally
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

Digital Banking Trends--GloballyCustomers all around the world want more digital options from their financial institutions. Whether by necessity or choice, in the richest and the poorest countries, people are embracing digital banking. Two recent global studies highlight some of the key trends internationally.

67% of global customers are already using digital banking.

People love digital banking – the majority of customers are using it already, and 86% want digital payment, 68% want digital personal loans and 62% want digital mortgages.


67% of Americans would try a new digital platform.
Less receptive than customers in India or China, Americans still show openness to new digital banking options.


52% of adults worldwide sent or received a digital payment last year.
Digital payments are increasingly popular, with the number of users having risen by 11 percentage points since 2014. Even in developing countries, 44% are on board with digital payments.


140 million unbanked individuals opened their first account last year.
Almost 70% of adults globally now have a bank account, in no small part due to the growth of digital payments – many opened their account specifically to receive payment from a job that paid digitally.


40% said their traditional bank didn’t help them with personal finance management.
These respondents said non-bank alternatives were better suited to help them manage their personal finances and look into investment options – a red flag for institutions that aren’t doing enough to guide their customers to financial literacy.


Traditional banks are more trusted than digital banks.
Digital banks are still lagging behind traditional institutions when it comes to trust and stability, but digital banks deliver superior experiences and better rates of return. As digital banks gain even more of a foothold, their perceived stability is likely to grow in the eyes of customers, who may be wooed away from traditional institutions altogether.

APRIL 20, 2018
A Tough Decision
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

A Tough DecisionPart of being a leader is making tough decisions. Part of being a good leader is getting people to accept those decisions. But when there’s no way to make everyone happy, what do you do?

David Maxwell has some pointers on how to make complex decisions with unknown outcomes. By understanding what makes these choices so tough, you can cut through your own clouded judgment to make a wise assessment.


Face issues head on

Problems can often feel like they came out of nowhere, but that’s rarely the case. It’s tempting to avoid tough calls until they become inescapable and demand your attention, but waiting until trouble reaches a boiling point actually allows the problem to grow and do more damage.

Have a sounding board

When you’re facing a terrible decision with no miraculous solution, it can be tempting to isolate and stew. But a better bet is to get as many perspectives as you can from a circle of trustworthy confidants. There may not be a magic bullet, but there could be a better option you wouldn’t have thought of on your own.

Minimize the damage

In the worst scenarios, there’s likely no way to avoid damage entirely – whether to your employees, your customers or your reputation. But once you’ve made your choice, communicate it clearly and get to work minimizing the harm done. Find ways to help those harmed by the decision, and don’t obsess over worst-case scenarios. On the other hand, don’t downplay what happened – recognize those who will bear the brunt of your decision.


Like Sophie or Solomon, leaders may one day have to make an impossible choice. But if they more fully understand the factors that go into their decision-making process, they will hopefully end up closer to Solomon’s choice than to Sophie’s.

APRIL 19, 2018
Countdown to Orlando
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

Countdown to OrlandoIf you’re as excited as we are, you know that The FMS Forum 2018 is less than eight weeks away. So here are some things to do between now and the big event in June:

Sharpen your pencils and buy a new legal pad – our educational lineup is loaded.


Get ready for fun, because we’ll have plenty of networking opportunities and groovy receptions, as well as a golf tournament and special access to Orlando’s many treasures.


Not only will your days be filled with education and recreation, but your nights will be the epitome of relaxation since you’ll be staying at the luxurious Hyatt Regency Grand Cypress at a special rate.


Need we say more? Take a peek at our Forum brochure to get a better look at everything we have in store for the 70th anniversary celebration!


See you in June!

APRIL 18, 2018
Hard Topics in the Big Easy
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

Hard Topics in the Big EasyNext month you can treat yourself to some gumbo, a muffaletta and a hearty helping of first-class financial education.

On May 15-18, FMS is heading down to New Orleans for a pair of terrific seminars: Comprehensive ALM and & IRR from Three Perspectives, and A Deep Dive: Liquidity Management. (Register for both to maximize your CPE and save over $600!) Not only will you gain in-depth understanding on these critical topics, you’ll do so while enjoying a special room rate an elegant hotel in the heart of a historic city.


So if you want to spend a few days learning from the experts at Darling Consulting and Alpha-Numeric Consulting – and spend a few evenings enjoying all that New Orleans has to offer – register now. As always, FMS members enjoy a special rate. (Not a member? Join today!)


APRIL 17, 2018
Millennials and Their Money
By Mark Loehrke, Editor, Financial Managers Society

Millennials and Their MoneyWhy are Millennials becoming more and more interested in wealth management services? The story behind that story has to do with their overall relationship with money, which is rooted in several distinct generational trends and attitudes: 

Skepticism and Wariness

Having witnessed firsthand the damage caused by the Great Recession, Millennials are more likely to avoid the stock market, keep their savings in cash or checking and focus their spending on necessities like education and health care.


Debt Concerns

Speaking of education, the greatest lesson Millennials have learned is that pursuing that college degree has left them with another mountain to climb – a mountain of student loan debt. Now it’s a burden that weighs heavily on most purchase and investing decisions. 


Time is of the Essence

When Millennials do decide to spend, they tend to favor items or services that help save them time – such as online purchases with same-day delivery or dining out instead of taking the time to prepare a meal at home – as opposed to the conspicuous consumption of luxury brands.


Given the above considerations, banks and credit unions need to tailor their approaches to this generation mindfully, with an eye toward forging an institution-customer partnership that goes far beyond a traditional transactional setup. Show them that you share their goals – and demonstrate how you can help them get there – and you may have the key to a long-term relationship.

APRIL 16, 2018
Cybersecurity Guidance
By Mark Loehrke, Editor, Financial Managers Society

As they survey the daunting landscape of cyber threats and look for ways to better shore up their defenses and response mechanisms, institutions can turn to two helpful new online guides to help them navigate the terrain.

Cyber Insurance


Even though it may lack the familiar comic appeal of a friendly talking gecko, FFIEC’s recent statement on issues to consider when determining whether to include cyber insurance as part of a risk management program can nevertheless be seen a useful addition to the debate. While FFIEC members (the Federal Reserve Board, OCC and FDIC) do not require financial institutions to maintain cyber insurance and the statement does not put forth any new regulatory expectations, the collective is looking to help facilitate the discussion around cyber insurance as more institutions begin to consider it as an option in light of the increasing volume and sophistication of cyber attacks.    


In short, the statement notes that traditional general liability insurance policies may not provide effective coverage for all potential exposures caused by cyber events. Cyber insurance could therefore offset financial losses from a variety of exposures – including data breaches resulting in the loss of confidential information – that may not be covered by other policies. Institutions should assess the scope of their current coverage and consider how cyber insurance may fit into their overall risk management framework, but should understand that cyber insurance is not a replacement for a sound and effective risk management program, which should continue to include identifying, measuring, mitigating and monitoring ongoing cyber risk exposure.


Cybersecurity and the Board


The Center for Audit Quality, meanwhile, has come out with a new tool designed to help guide board members through the issues they need to know in order to stay on top of their institutions’ cybersecurity programs. The tool suggests that board members ask questions designed to help them better understand how the financial statement auditor considers cybersecurity risk, the role of management and responsibilities of the financial statement auditor related to cybersecurity disclosures, and management’s approach to cybersecurity risk management.


Some of the questions the CAQ recommends asking include:


  • How are cybersecurity risks that auditors identify addressed in the audit process?


  • What impact would a cybersecurity breach have on the auditor’s assessment of internal control over financial reporting?


  • What does the auditor consider related to cybersecurity disclosures?


  • What framework does management use in designing its cybersecurity risk management program?


  • What processes are in place to periodically evaluate the cybersecurity risk program and controls?


The tool also compiles cybersecurity-related resources from the CAQ, the American Institute of CPAs, the National Association of Corporate Directors and others.

APRIL 13, 2018
A Wake-Up Call from Zuckerberg
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

A Wake-Up Call from ZuckerbergData analytics are a big deal for financial institutions these days (you may recall the Data Duo story from the November/December 2017 issue of FMS forward explaining the benefits of implementing data analysis).

It’s now pretty much agreed that institutions absolutely have to use customer data to cater to their customers – not only because it’s good for business, but because this is, in fact, what customers want. But Mark Zuckerberg’s time in the hot seat has highlighted the fact that many customers don’t really understand how their data is being collected and used and, in fact, they may not be terribly happy if they were they to find out.


A recent survey showed that a full 30% of consumers think providers using their payment and purchase data is an invasion of privacy that should be prohibited, while another 32% have reached a tepid acceptance, calling it a necessary evil that only occasionally benefits them. Only 15% said it’s a benefit that improves their experience and helps with product recommendation – and an additional 23% said it’s a benefit, but hedged by arguing that they should be compensated for their data or have some other guaranteed benefit in exchange for their personal information.


Financial institutions can take a lesson from Facebook’s public interrogation. Customer data should be protected and kept private (see the September/October 2017 issue of FMS forward for tips on cybersecurity), and customers should also be informed in clear, readable language exactly what you plan on doing with their data. That way, there won’t be any nasty surprises (or, hopefully, congressional hearings).


Mark Loehrke
Editor and Director, Publications and Research

Danielle Holland

Hilary Collins
Specialist, Publications and Research