No matter the market, a bank today likely has competitors offering 5.5 percent on a certificate of deposit. With competitors pushing the pricing envelope, leaders certainly may wonder: Will high cost of funds become a threat to return on assets? [Continue]
ChatGPT has taken the world by storm. When asked what small business owners want from their banks, ChatGPT identified five key factors. [Continue]
If bankers could choose a funding portfolio made up of deposits committed for a time, or deposits that could leave at any time, they’d choose the former. But, looking at the industry’s deposit composition during the last 30 years, it appears just the opposite. If our asset-liability logic says banks would generally prefer term deposits, what dethroned the CD? Bankers already know the common answers: Interest rates and/or depositor preference. [Continue]
Funding loans is a little more difficult today than it was a few years ago when interest rates were at rock bottom levels. With funding costs on the rise, some bankers are being more careful about lending. [Continue]
The Consumer Financial Protection Bureau’s final rule implementing Section 1071 of the Dodd-Frank Act has made waves in the banking industry since its announcement in late March. [Continue]
In an April roundtable hosted by The Brookings Institution, Prasad Krishnamurthy, professor of law at the University of California, Berkeley, said the Federal Reserve should consider extending its deposit insurance cap far beyond what it is now. [Continue]
Executives who focus single-mindedly on cost of funds have missed the exit ramp, and it does not bode well for their organizations. With some art and some science, banks can de-commoditize deposits by segmenting deposit offers in more robust and differentiated ways than those deployed decades ago. Improved sales processes — and training for frontline staff that has not been imperative since 2009 — can differentiate a bank and bring in profitable funding, though higher-priced, without the detrimental impact of repricing the entire book with across-the-board rate increases. [Continue]
The April 10 shooting that killed five employees at an Old National Bank branch in Louisville, Ky., shocked banks across the country and raised difficult yet necessary questions of how to recognize the signs of a potential shooter. [Continue]
It might be easy to say, “That was a big bank, and we’re community banks. We’re different.” And while that’s true, there are certainly some aspects of the SVB failure that apply to banking across the board. [Continue]
Today, there is so much content online, and so many opinions circulating, that it’s difficult to cut through the noise. That’s why focus groups are more relevant than ever. [Continue]