Could Net Interest Margin Woes Spell Opportunity?
When an in-person strategic planning retreat has to be hastily switched to a virtual one, sacrifices must be made. And in this case, I simply didn’t have the time to review the long-term implications of the Fed’s guidance that they were not inclined to raise the Fed Funds Rate until inflation hit or passed 2%. […]
Create Operating Discipline at Your Bank
Bankers have made great strides in developing the strategies to succeed over the long-term, analyzing the customers that most value their strategic direction, and gaining the buy-in from their Boards of Directors and employees. The next challenge is to build the environment and culture where the organization moves toward its aspirational future. To create operational […]
For Banks, Self Assessments Are Hard
Self assessments are hard, period. Not just in banks. But since this is a banking blog, let’s focus there. Strategic plans should include a fact-based self assessment. Some call it a situation analysis, others an environmental scan. They usually include a SWOT, which some people dislike but I find the vitriol around a SWOT to […]
A Whale of a Tale: Enloe State Bank
“The bank’s on fire!” So said the panicked cleaning person that ran across the parking lot from the bank to the adjacent restaurant. “Call 9-1-1!” The bank in reference was Enloe State Bank, a $37 million in total assets, one-branch bank based in Cooper, Texas, population 1,969. The fire happened on May 11, 2019 and […]
Texas Big: First Road Trip Since the Pandemic
It was bound to happen. After four months of lockdown, bankers are getting back to the office. They never stopped working, mind you. But work has been different to say the least. This month was our first opportunity to visit clients outside of driving distance since March! The challenge: We are based in Pennsylvania and […]
Bankers: Hunker or Pounce?
Unprecedented times. How many of our borrowers on forbearance can begin making payments? What provision do we make this quarter? How do we justify it? What will our constituencies think when we have to foreclose on borrowers? For most of us, the onset of a recession means a time to assess the risk on our […]
Bankers: Who Has These Three Drivers of Value?
Two years ago bank stock analysts from investment banking firm Boenning & Scattergood identified three attributes in a financial institution that investors should look for. I wrote a blog post on it that is currently my third most read post of all time. The three attributes were: Superior Growth Prospects Excess Capital Strong Deposit Franchises I can […]
Money Is Math. And Math Is Color Blind
Typical conversation at my house: Me: How much was on the credit card?!?! Wife: Well, it’s because of [reason 1], [reason 2], and [reason 3]. Me: Our checking account doesn’t care about the reasons. We pay the amount on the credit card, and it comes out of the checking account. Simple math. This conversation is […]
The Federal Reserve’s Main Street Lending Program: Manna From Heaven for Community Banks?
“How much more abuse can small businesses take from big banks?” ~ Community Bank CEO PPP is winding down. Community banks not only took care of their small to medium sized businesses (SMEs), but also helped big bank customers when their calls went unanswered. Why? Because the big banks prioritized. It was a first come, […]
Banks On Sale
My bank stock portfolio was comfortably in the black, with a solid 2.5% dividend yield at year-end. My have times changed. Before I begin, I feel compelled to disclose that I am not a registered broker or financial advisor. I am not giving you investment advice. At December 31, 2019, the SNL Bank & Thrift […]