Print Issue: 2021 - October Edition

Right to repair: Nerds get their revenge in the farm field

The next time you meet with one of your ag customers, please thank them on behalf of your IT department. By adding their political clout to a much broader technical issue, farmers have helped achieve a Federal Trade Commission policy breakthrough heretofore unreachable: The right to repair. If the FTC follows through properly with its new directive, this will help your perennially struggling ag customers’ bottom lines — as well as perhaps lower your bank’s computer equipment costs over time.  [Continue]

Look beyond your footprint when recruiting for tech

Joe McIntyre, senior vice president with Robert Half’s technology solutions group, speaks about the difficulty banks are having filling tech positions. “We’re seeing less than a 1 percent unemployment rate for IT professionals, which is creating a real problem for banks trying to hire,” he said. “The supply and demand is really out of whack. There are simply many more jobs than there are candidates.” Digitalization efforts are driving up a demand for experienced IT professionals. [Continue]

Express your brand, internally and externally

We’ve all heard of “company branding” but what does that really mean for community banks? In a highly competitive environment, it’s about more than “we’re here to serve our communities.” It’s about setting your bank apart: What makes you unique? What are your bank’s values? How do you meet your overall mission? [Continue]

Create a competitive advantage with fintech partnerships

The word “fintech” first emerged in 1971, but it really began to rise in the 2000s and then its prevalence exploded in the 2010s. At first, banks weren’t sure what to make of fintechs. Were they products to purchase? Competitors? And what qualifies as a fintech? Different types of fintechs interact with banks and consumers in different ways. Some of them can create a competitive advantage, providing sleek or robust services to community bank customers that are on par with or exceed those offered by megabank competitors.  [Continue]

More than money needed to attract talent

Recruiters say a complicating facet of attracting and retaining key bank employees is a surplus of retirement-age bankers and the deficit of college graduates entering the industry. Stuart Kazor at Omaha, Neb.-based financial recruiting firm Adams Inc., noted other industries or roles, especially fintechs and IT positions, are more lucrative. [Continue]

Three tips for today’s bank leaders

With the economic situation still uncertain more than a year and a half after the pandemic started, banks are facing challenges in trying to figure out how to position their institutions for the future. While I offered thoughts on an array of topics — from the need to reimagine what asset-liability committees can and should be to the importance of thinking differently about pricing — my top three ideas are: Develop new relationships, look at derivatives, and examine wholesale funding. [Continue]

Should banks be financing farm real estate now?

Every Federal Reserve district bank is reporting hefty increases in farmland prices. Ultra-low interest rates are helping drive land prices. Is it too early to use the bubble word? And it isn’t just land prices; if you lend money to farmers and ranchers, you know there has been an explosion in prices for used machinery and all input costs. How long do these artificially low rates last, and what happens to asset values when rates start to climb? [Continue]

How will farmers deal with climate change and other challenges?

As they near the end of 2021, many community ag bankers say their farm clients are feeling optimistic, but the industry isn’t entirely sunny. Farmers have long served as stewards of the natural world, and as climate change becomes a more pressing topic, they wrestle with how to respond. That’s not their only challenge, as they also face down consolidation, rising real estate prices, rate pressure, among other issues. [Continue]

What I learned from buying a troubled bank

At the end of July 2013, we invested $1.8 million to buy 49 percent of Flagship Financial Group, Inc. This was the start of one fun journey that continues today. The primary asset of the organization was Flagship Bank Minnesota, which had two locations in the Twin Cities metro area. The bank was under a cease and desist order and struggling with a high level of troubled assets. However, it had a great group of employees and was in a market that I knew very well. At the time, Flagship Bank Minnesota had $94 million in assets and $62.8 million in loans in the two locations. In June 2021, we were up to six locations, $327.6 million in assets and $233.7 million in loans.  [Continue]

Find talent beyond your pre-pandemic scope

Businesses across the country have reported that they are struggling to hire, and the banking industry is certainly not immune. In what has been dubbed “The Great Resignation,” this has become a reflection of the shifting priorities of employees.  In a survey by CreditKarma, 41 percent of U.S. workers are considering leaving their current job within the next six months. The current pressure that banks are feeling to hire may be only the tip of the iceberg between not being able to fill open roles and the potential that existing employees may leave.  [Continue]