Performance Measurement

Branch vs. Lending Organizations: Which Organization Won the 2020 Profitability Battle?

Community financial institutions came off of a strong year in 2019 and entered 2020 a little apprehensive. The economy was slowing, the Fed started lowering interest rates and there was a presidential election on the horizon. By the middle of the first quarter of 2020, apprehension turned into anxiety. Today we are not completely over […]


CFPB: Are They Coming to Get You?

A bank trade association CEO asked me a couple of questions while he was researching an op-ed piece. The edited Q&A is below. Q. Shouldn’t the CFPB work to address the impediments to starting a bank in LMI markets rather than punish community banks who scrambled to serve their customers when the economy shut down? […]


Banking’s Top 5 Total Return to Shareholders: 2020 Edition

For the past nine years I searched for the Top 5 financial institutions in five-year total return to shareholders because I support long-term strategic decision making that may not benefit next quarter’s or even next year’s earnings. And I am weary of the persistent “get big or get out” mentality of many industry pundits. If […]


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%. […]


Are Your Management Reports Just An Illusion?

Many financial institutions produce management reports using data only from their general ledger systems. An example is producing branch profitability reports limited to data from the branch’s cost center. Limiting the information within your management reports to only general ledger data may be producing reports that are just an ILLUSION! As noted by this famous painting […]


Two Ideas to Lower Operating Cost Per Account

Last week I wrote a TKG Perspective’s article on Bank Profitability in 2019. I congratulated community financial institutions for delivering a positive trend in business checking account operating cost per account. The challenge is, aside from residential mortgages, all other product categories showed negative trends in operating cost per account. In the below video blog, […]


Banking Profitability Roundup

End of year brings banking industry summaries. Some are very good, such as this one written by Jeff Davis of Mercer Capital (Mercer). In his summary, you’ll find charts and trends for net interest margin (NIM), pre-tax ROA, and fee income for whole institutions, and broken out by size cohorts. But that is as deep […]


How To Do Product Management Without Product Profitability

Quick answer: I don’t know. I posited this question on Twitter because product management has come up during various financial institution strategic planning sessions. I also don’t know of many new banking products since I’ve been in the business. See my post on that subject here from nearly two years ago. But product management is […]


Is It Customer Loyalty That You Seek?

Why are customers loyal to your financial institution? I hear many reasons in strategic planning sessions: 1. Our people. They are loyal to their lender, branch manager, etc. 2. Our service. We have the best service! 3. Our products. We have a really cool checking product. 4. Our location. We’re right in town. Aside from […]


Bankers: Is It Worth Buying Checking Accounts

At least somebody noticed. Noticed that I might be a valuable checking account customer. Aside from credit cards, I don’t get much attention from bankers or financial advisors. Maybe the “do not call” list is more effective than I thought? So when I opened my mailbox and received the bribe, I was interested. Interested to […]