Abound Resources Share Results from their Annual Survey of Community Finanical Institutions in Complimentary White Paper

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Abound Resources' third annual survey shows that community financial institution CEOs are optimistic about 2012 but remain concerned about the weak economy, loan demand and regulatory burden. Complimentary white papers that analyze the complete survey results are available for download at the Abound Resources' website.

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According to Abound Resources’ white papers that analyzes their survey of community financial institution executives, CEOs of community banks and credit unions are feeling more positive than last year in spite of the regulatory cloud. Almost half of CEOs feel either somewhat optimistic or very optimistic about 2012.

Unlike 2011, when CEOs were uncertain about what regulations such as the Dodd-Frank Act and the Durbin Amendment would really mean for their institutions, CEOs in 2012 are a bit more optimistic because they are now able to plan for the impact of these and other regulations and drive their organizations toward the future.

Regulations, along with a weak economy and loan demand, still do continue to weigh on CEOs minds. “On the credit union side concerns about regulatory issues are a bit more pressing because they often lack internal resources to fully understand what will be required", said Brad Smith, President and CEO of Abound Resources. “Most credit unions will require external assistance to fully prepare for the coming regulatory requirements.” On the bank side, Mr. Smith points out that community banks appear ready to expand commercial lending and technology spending.

According to the "Insights into 2012" survey, CEO major concerns this year are:

COMMUNITY BANK                        
Regulatory Burden – 67%            
Weak Economy/Loan Demand – 65%        
Interest Rate Environment – 36%            
Growing Fee Income – 22%                    
Credit Quality/Problem Loans – 18%        

CREDIT UNION
Weak Economy/Loan Demand – 70%
Regulatory Burden – 53%
Interest Rate Environment – 45%
Membership Growth – 19%
Credit Quality/Problem Loans – 18%

Although concerns are similar there is a diversion as would be expected, when it comes to setting priorities. While both place a high priority on improving efficiency and streamlining workflows community bankers’ highest priority is growing commercial loans (75%) while credit union CEOs indicated that improving marketing and sales (57%) was their highest priority.

In addition to CEOs, Abound Resources also polled chief operating officers, chief information officers and chief financial officers about technology concerns and project plans.

Nearly two-thirds (61%) of community bank COO, CIO and CFO respondents report that their technology spending will increase in 2012 which makes sense given the slight increase in CEO optimism this year.

Credit unions gave a slightly different perspective indicating that technology spending would remain flat and the the priority would be to extract more value from existing technology and vendor relationships.

However, comparing credit union CEO growth priorities with COO, CIO and CFO technology plans shows a clear disconnect. “The priorities for the C-suite center on technologies that increase customer convenience but don’t move the needle on the CEO’s focus on improving sales and marketing,” said Brad Smith.

There is also a disconnect between the C-suite and the CEO among the community banker respondents. As with the credit unions, the COO, CIO, CFO group’s priorities center on technology while the CEO is focused on commercial lending and improving efficiency.

Complimentary white papers that analyze the complete survey results are available for download at http://www.AboundResources.com or by clicking on the below links:

Insights into 2012: Community Banks Balance Growth, Efficiency and Compliance

Insights into 2012: Credit Unions Balance Growth, Efficiency and Compliance

ABOUT ABOUND RESOURCES

Abound Resources is a full service management consulting firm with the sole purpose of helping community financial institutions achieve their goals - whether those goals are for growth, efficiency, technology or risk management. In fact, we guarantee it.

Abound Resources offer an array of services designed to improve performance and profitability and help community institutions cope with an increasingly stringent regulatory environment.

Our seven practice areas are each headed by an experienced practice leader:

  • Technology – technology plans, vendor evaluations, core RFPs, bank contract negotiations, bank vendor management
  • Operations and Payments – workflow improvement, bank efficiency studies, payments strategies
  • Lending – loan process improvement, loan origination vendor evaluations and implementations
  • Small Business and Commercial – small business deposit and fee income growth programs, bank cash management programs
  • Strategic Planning – bank strategic plans, risk tolerance planning, one page strategic plans, competitive differentiation
  • Sales and Marketing – branch performance improvement, sales coaching and training, e-marketing strategies and campaign management
  • Risk Management and Compliance – ERM, IT audits, information security assessments, compliance, BSA review

Abound Resources is proud to be an Alliance Provider for CUNA Strategic Services and a Platinum Service Member of the American Bankers Association.

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Deirdre Grubbs
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