The Daily Dividend

News, notes and insights from around the industry

DECEMBER 14, 2018
Last-Minute Shopping
By Mark Loehrke, Editor, Financial Managers Society

Tis’ the season to seek out bargains, and FMS has a great one – but only if you get your shopping done now.

The 2019 FMS Forum may be six months away, but our early rate is only available until December 23rd! So register today to save $100 on all of the amazing educational opportunities and valuable peer connections the Forum offers year after year.

But the early rate will be gone soon, so be sure to put a trip to Boston for the 2019 FMS Forum on your last-minute wish list. And remember – FMS members enjoy an even lower rate than non-members, so if you haven’t already, join now!

DECEMBER 13, 2018
FMStv: The Importance of a CECL Implementation Roadmap
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

FMStv: The Importance of a CECL Implementation RoadmapIf you’ve been waiting impatiently for Netflix to release the latest season of [insert your favorite show here], you can now bide your time in a productive manner by checking in on a brand new episode of FMStv. 

In The Importance of a CECL Implementation Roadmap, Tom Caragher of ZM Financial discusses an effective way to plan and track CECL implementation by creating and following a roadmap that brings every component together and plots key goals and milestones on a comprehensive timeline. 

Since CECL will impact numerous areas of your institution, having a sound plan is crucial – tune in to FMStv now to learn how to get started.
 

DECEMBER 12, 2018
The New CFO
By Mark Loehrke, Editor, Financial Managers Society

The New CFOThat the CFO role has been undergoing massive changes in terms of responsibilities and expectations over the past several years is hardly news to those currently occupying that spot. Ongoing change is just part of the day-to-day reality for today’s CFOs – a fact driven home yet again in the latest global survey from McKinsey & Company.    

Among the notable findings to emerge since the company’s previous poll two years ago, CFOs say the number of functions reporting to them has risen from about four to more than six – including big increases in areas such as internal audit, corporate strategy, product pricing, board engagement and enterprise transformation – and the share of CFOs overseeing their companies’ digital activities has roughly doubled (neither of these developments will come as surprising to many FMS member CFOs, of course).     

While the pace of change and the increasing demands on their time may be stressful, McKinsey prefers to take an optimistic view of the evolution of the role, noting that the current environment offers an opportunity for CFOs to present themselves as both leading change agents and sources of competitive advantage for their organizations like never before. The question, then, is how to best reach that goal by balancing their traditional (and still very necessary) tasks with the collaboration and talents that the new definition of the role now requires. 

Need some ideas? Make plans to attend the FMS webinar 2019 CFO Outlook: Insights and Recommendations for Financial Institutions on February 6, 2019.
 

DECEMBER 11, 2018
CU 3Q
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

The results are in, and the NCUA reports that the third quarter was a rousing success for credit unions nationwide. For the period ending September 30, the 5,436 federally insured credit unions celebrated rising assets, falling delinquency rates and increases in membership.

Total assets rose by 5.6%, or $77 billion, from the year before, to total $1.14 trillion. Loans also saw a hearty increase from the year before – 9.5%, or $89 billion – to $1 trillion. Though loans may be on the rise, delinquencies retreated to 67 basis points, down from 79 a year earlier, while the net charge-off ratio saw only a one-point rise from the year before.

Net income was another reason to celebrate – up $3.1 billion (30%) from the third quarter of 2017. The net interest margin was $44 billion, or 3.1% of average assets, up from $39.5 billion (3.0%) at this time last year.

While the total number of credit unions fell by 206, membership was on the rise yet again. Credit unions have gained 4.9 million members so far in 2018, reaching a total of 115.4 million — that’s a lot of reasons to celebrate this holiday season.
 

DECEMBER 10, 2018
A Second Look at forward
By Mark Loehrke, Editor, Financial Managers Society

Looking forward to 2019Year-end is always such a busy time for banks and credit unions, and we can relate here at FMS – not only are we putting the finishing touches on our upcoming January-February issue of FMS forward, we’re actually deep into planning for March-April already as well. But before all of that work comes to fruition, we’ve rounded up some stories that offer a second look at the topics we covered in the November-December issue.

In Forever Young, we built a nice graphic spread around our latest proprietary research on how institutions are appealing to younger people – both as customers and employees. Once they find a way to get those young employees in the door, however, it would be great to also have a solid strategy for grooming them as future leaders.

Industry veteran John Behringer covered a lot of ground in his Eye on ’19 Q&A, including his thoughts on the technological development that he expects to impact banks and credit unions in 2019 – here are five more innovation trends to consider as January approaches. Behringer also touched on the economy and interest rates, of course – two topics that will weigh heavily as institutions look ahead to 2019.

Finally, Rob Newberry and Larry Sorenson engaged in a lively debate about the potential impact of CECL in Point-Counterpoint. Theirs are just two of the many voices that will continue to weigh in on the new accounting standard in the months ahead.
 

DECEMBER 7, 2018
FMS Webinar: Understanding and Using Customer Profitability
By Hilary Collins, Specialist, Publications and Research, Financial Managers Society

FMS Webinar: Strategic Implications of CECLTo stay competitive in the financial services industry, customers must be at the center of everything. But even with access to so much customer data, many institutions still lack an understanding of the value each customer brings to the organization. 

If you suspect your customer profitability system needs a tune-up, join us for a two-part super webinar, “Understanding and Using Customer Profitability,” on December 11 and 12. Brad Dahlman of ProfitStars will use part one to explain what drives customer profitability and how to implement changes to your current system, then in part two will explain how to best analyze your customer data and use it to make the kinds of decisions that will help move your institution forward.

You can join us for part one, part two or both – register today!
 

DECEMBER 6, 2018
Looking Ahead to 2019
By Mark Loehrke, Editor, Financial Managers Society

Looking Ahead to 2019Deloitte is out with its annual Banking Outlook for 2019, which paints a decidedly optimistic picture for the industry heading into the New Year – provided institutions are prepared to make the changes necessary to take advantage of the new opportunities that may be coming their way. Among the more notable nuggets from this year’s report:

The U.S. banking industry as a whole finds itself on firmer ground a decade after the financial crisis, thanks in part to favorable GDP growth, tax cuts, rising rates and regulatory relief

More and more institutions are embracing the spirit of digital transformation – from creating new capabilities to modernizing legacy systems – which will be increasingly important as new fintech competitors enter the arena

The competition for qualified talent continues to heat up as well, with Deloitte recommending that institutions focus on enabling employees to work more creatively to solve problems that create new value for customers – which may mean looking outside of the industry for the talent they need

While the risk management function appears to be evolving – with institutions having made notable advances in how they assess and mitigate risk across the enterprise in recent years – current systems may be less equipped to manage emerging risks, including growing cybersecurity threats 

Even as price competition in deposits is likely to increase due to higher rates, Deloitte does not anticipate a deterioration in credit quality in 2019, although the report does note that a potential slowdown in 2020 or beyond could alter the competitive dynamics

Although banks are expected to become more active in the fintech space, either by launching stand-alone digital banks or through partnerships, Deloitte believes the importance of the traditional branch in attracting and retaining customers should remain for the foreseeable future

In addition to the above topics, the report also offers a trove of information regarding M&A trends, payments technology, the growing wealth management industry and much more.
 



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