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SRM Perspectives on Key Industry Trends

Paul Davis

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Key Takeaways from CUNA GAC: Challenging Times Ahead

Posted by Paul Davis on Mar 8, 2022 9:16:42 AM

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The CUNA Governmental Affairs Conference was in-person for the first time in three years, giving many credit union executives a long-overdue chance to have face-to-face meetings.

 

SRM made the most of the week, engaging with scores of executives, getting a sense of their challenges and opportunities, and lining up discussions to assist in crafting strategies and finding solutions for both.

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Topics: Digital Banking, Vendor Contract Management, Cryptocurrency, Credit Union Vendor Management, Cryptocurrency for Banks and Credit Unions, Loan Growth, Deposits, Overdraft

Merger Scrutiny, Overdraft Fees & More: Banking Regulation in 2022

Posted by Paul Davis on Feb 8, 2022 11:47:00 AM

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Financial institutions should brace for substantial regulatory change in the year ahead.

Turnover at the top of several federal agencies, including the Consumer Financial Protection Bureau (CFPB), the Office of the Comptroller of the Currency (OCC), and the Federal Deposit Insurance Corp. (FDIC), foreshadows more scrutiny for FIs.

Everything seems to be on the table, including timelines for implementing the Current Expected Credit Loss (CECL) accounting standard, data privacy, and Bank Secrecy Act compliance.

There are, however, several areas that we believe merit the most attention in the coming months.

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Topics: Vendor management, Cryptocurrency, Interchange, Regulations, Mergers & Acquisitions, Overdraft

How a CBDC Could Disrupt the US Financial System

Posted by Paul Davis on Jan 27, 2022 9:30:00 AM

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Creating a US central bank digital currency (CBDC) could have several benefits; however, it would also cause a plethora of systemic challenges for the existing financial system.

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Topics: Vendor management, Cryptocurrency, CBDC, Federal Reserve, Blockchain

How Financial Institutions Are Trying to Appeal to Younger Consumers

Posted by Paul Davis on Jan 18, 2022 9:30:00 AM

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Financial institutions (FIs) of all sizes struggle to recruit and retain younger employees and customers – a challenge exacerbated by the rise of neobanks that offer enhanced experiences, streamlined processes, and faster decisions.

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Topics: Payments, Vendor Contract Negotiation, Bank Vendor Management, Credit Union Vendor Management, Rewards Programs, Gen Z

Identifying Revenue Opportunities in 2022

Posted by Paul Davis on Dec 1, 2021 9:30:00 AM

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It will be difficult for financial institutions to boost revenue in 2022 – many will need to be more innovative than ever to add customers, book loans, and bring in fees.

Interest rates should remain low next year, and competition will intensify as loan demand returns. Customers’ shifting preference for digital channels will require tech investments that will further pinch bottom lines.

Financial institutions are looking at niche businesses, acquiring loan portfolios, and creative revenue strategies to offset those pressures. Here’s a look at some tactics being employed.

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Topics: Fintech, Bank Vendor Management, Credit Union Vendor Management, Buy Now Pay Later, Cannabis Banking, Revenue

What’s Driving the ICBA’s Pivot with Credit Unions Buying Banks

Posted by Paul Davis on Nov 2, 2021 9:30:00 AM

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Although credit unions have been acquiring banks for nearly 20 years, the banking industry has recently intensified its efforts to slow the pace of activity. The pushback is partially due to the aggregate number of credit unions buying banks – roughly 100 have taken place since 2003 – and that the purchases are, on average, becoming more significant.

A case in point is Midwest Community Bank in Freeport, Illinois, which recently became the 12th bank to agree to be sold to a credit union this year. Overall, the credit union industry could eclipse the all-time high of 16 bank acquisitions announced in 2019.

The Independent Community Bankers of America (ICBA), which has objected to these transactions for years (largely citing the tax-exempt status of credit unions), sent a letter to Treasury Secretary Janet Yellen in July recommending that the federal government assess an exit fee on credit unions when they buy banks.

This proposal represents an interesting shift for the ICBA, one that we will look at more closely below.

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Topics: Vendor Contract Negotiation, Bank Vendor Management, Credit Union Vendor Management

Tech upgrades are coming – but at what cost?

Posted by Paul Davis on Oct 27, 2021 9:00:00 AM

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Despite concerns about upfront costs, a growing number of community banks are preparing to implement technological upgrades, such as online loan closings and automated underwriting.

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Topics: Fintech, Automation, Bank Vendor Management, Credit Union Vendor Management

The Four Whys Driving More Buys | Excess Deposit Strategies Add to M&A Trend

Posted by Paul Davis on Aug 24, 2021 9:30:00 AM

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In response to the banking industry’s recent influx of deposits, several recent bank acquisitions show how some banks are responding to the pressure of putting liquidity to work.

Midsize banks like Truist Financial, Fifth Third Bancorp, Regions Financial, and some community banks have announced acquisitions where they plan to hold onto loans that the sellers would typically roll off the balance sheet.

Their objective? To redeploy billions of dollars in deposits held by the acquirers, shore up net interest margins, and boost returns.

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Topics: Lending Strategy, Mergers & Acquisitions

New OCC Fintech Charter Gives Challengers & Neobanks A Competitive Edge

Posted by Paul Davis on Jul 22, 2021 9:15:00 AM

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In recent years, challenger banks, neobanks, and other fintech startups have intensified their efforts to compete as financial services providers. Now, regulators have renewed interest in shifting the odds in their favor.

By obtaining a new specialized charter through the Office of the Comptroller of the Currency (OCC), new competitors may gain strategic advantages over more conventional banks and credit unions.

Here is a closer look at some legal and regulatory developments which could determine just how entrenched fintechs will become in the payments system – and how competitive they can be with core banking products and services.

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Topics: Payments, Fintech, Digital Banking, FDIC, Challenger Bank, Neobank, Growth Strategies

SRM Mid-Year Trends 2021 | Banks & CUs Perform Balancing Act

Posted by Paul Davis on Jul 14, 2021 9:30:00 AM

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SRM recently released its list of 2021 midyear trends that banks and credit unions should monitor during the second half of this year. Naturally, these developments didn’t appear out of thin air – our top-performing project managers and experts make it their business to examine and spotlight those topics which carry the greatest strategic impact for payments and financial services.

In this post, SRM shines a light on some big acts we’ve long anticipated will draw attention by the millions, billions, and trillions.

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Topics: Digital Banking, Vendor Contract Negotiation, Bank Vendor Management, Credit Union Vendor Management, payment trends, Voice Assistants

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