CPG and industry friends gazed into a crystal ball to predict that the following events will occur in 2016:
1. In the latest version of the strategy “If you can’t beat ‘em, buy ‘em”, a bank will acquire a leading non-bank on-line lender in order to capture the growth potential and the technological savvy of those companies. ~ Claude Hanley, Capital Performance Group
2. As interest rates rise, competition for core small business deposits among community banks will increase and more community banks will begin to pay interest on small business demand deposits. ~ John Barrickman, New Horizons Financial Group
3. A greater number of banks will adopt more formal commercial on-boarding practices. This follows from a wider appreciation among executives that a regular, organized process of coordinated contacts in the first year between the new customer and various bank personnel (and potentially board members) lowers buyer’s remorse and deepens partnerships with new bank customers. ~ Jack Hubbard, St. Meyer & Hubbard, Inc.
4. Banks will increase their efforts to automate low-value (i.e. predictable, repetitive) elements of client sales interactions that, to this point, banks have thought only branch staff or small business bankers could provide. Bank management will pursue this automation in order to increase efficiency, ensure greater consistency in the customer experience, and to improve their information on customer interactions. ~ Nick Miller, Clarity Advantage Corp.
5. Loan problems will begin to appear among community banks, especially among banks that are located in agricultural markets, oil and gas regions, and coal mining areas. ~ Christine Corso, New Horizons Financial Group
6. The Fed will begin to raise rates in 2016 but do so very modestly as world economic challenges dampen expectations for the U.S. economy and the presidential election whirlwind dampens moods. Even so, midsize and community banks should continue to outperform larger banks who are more reliant on consumer banking – which the CFPB and other regulators have made significantly more costly for bigger institutions. ~ Mary Beth Sullivan, Capital Performance Group
7. Senator Elizabeth Warren will find only a chunk of coal in her stocking on Christmas morning due to her naughty bank bashing this year. ~ Santa Claus