Banking

Partly because of economic volatility, longer-term brokered CDs have become more competitive in the past few years. In recent regulatory proposals, the competitive environment could get significantly more challenging. Traditional banks should be aware of the regulatory conversations and prepared to take their customers through the process of considering and pursuing these investment vehicles.

In September, the Consumer Financial Protection Bureau (CFPB) issued its final ruling on an amendment to Regulation B of the Home Mortgage Disclosure Act (HMDA). It also noted its intent to assist with compliance with Regulation C. The amendment, which follows a 2015 congressional update, will go into effect starting January 1, 2018. Ultimately, it is designed to give creditors more flexibility to meet standard government regulations, but banks are generally unprepared for the changes, in part because the standards have been moving targets.

As every football fan knows, the "hurry-up offense" is a staple in many playbooks. (For those of you unfamiliar with the term, in a “hurry-up offense,” the offense tries to execute as many plays as possible—as quickly as possible). It's a style of attack that works well if the opponent is complacent or under-prepared. When successful, the speed of the play exposes weaknesses in the defense quickly. It wears them down, and makes them confused and frustrated, giving the offense the opportunity to capitalize on the defensive breakdown.

For organizations of every kind, data breach incidents are "when"—not "if" events. Especially for business entities (like banks) that manage clients’ private information, building vigilance against threat actors, unintentional compromises, and other cyber vulnerabilities is as much a part of risk management as instituting compliance measures. But understanding how to spot weaknesses, build transparency, and engage checks and balances demands a new level of focus and capability for many banks.

The banking industry has been (understandably) shaken by the rise and impact of technologies like automation and artificial intelligence. The audit profession has been similarly shaken. Already, machines can handle a substantial portion of the audit services we provide. Oddly enough for a client service profession, however, it’s virtually impossible to find any information about how tactical audit process changes will impact our clients. A quick Google search shows no articles about what audit clients should expect to experience in the coming seven or so years.

At the start of 2017, we looked at the topics that were of the greatest interest to you in 2016. Issues related to regulatory changes, cyber issues, demographic shifts, and new banking channels and roles for community banks captured our attention—and yours. Not surprisingly, our most popular blogs of 2016 were related to technology risk and complexity, global markets, and regulatory complexity. 

As banks evolve, so should your leadership team and board. Shareholders, analysts, investors, and even customers want proof of diversity, collaboration, and confident decisions. No longer can a bank board be a ‘good old boys club’ comprised of leaders from the local business community. Effective leadership reflects the composition of the customer base, it encourages objectivity, and it brings a broader set of collective skills to bear.

As promised, the Federal Reserve’s monetary policy committee raised interest rates by a quarter of a percentage point at its March 15 meeting. Chair Janet Yellen had suggested the hike would be appropriate if economic markers—in particularly GDP rates, jobs, and consumer spending—improved over a slight slump from at the start of 2017 determined to be mostly ‘transitory.’

Many company leaders see audit as a task related to compliance, and that’s a fair—if overly simplified—definition for external audit. Once per year, an external auditor will perform an annual examination and issue an objective report regarding the financial statements. This regulated activity has an impact on the reputation and financial health of a business. Internal audit is neither specifically tied to regulation, nor is it a single, time delineated task. It is, however, more vital to the ongoing resilience of the business. The effort is more flexible and tailored to the goals and qualities of the entity, and (if done well) is performed throughout the year to monitor company practices and risks.

“Business and government face significant challenges to keep pace with a dizzying array of rapidly emerging and evolving risks. The internal audit profession is in an ideal position to help them, but we must have the right talent at our disposal to provide that assistance.”

Amid the many other differences between presidential nominees Donald Trump and Hillary Clinton, the two have proposed very different tax law changes. As opposed to trying to make sense of the many subjective differences between the candidates, understanding how each candidate could impact tax policy may be the best way for businesses and individuals to compose an informed plan for the future.

For about nine years, analysts have predicted two game changers for the banking industry – an M&A boom and an interest rate hike. The M&A prophecy came true in 2014, with the highest transaction volume since 2006. Based on year-to-date transaction activity, this trend will continue through 2015.

Picture it: you are at the next technology conference boasting about how you just spent your entire IT budget to buy the best security equipment on the market. You have earned the admiration of your peers. And then comes a call from the IT department. An employee has compromised your system by clicking on a malicious link in a phishing email, thinking it was a legitimate message from the helpdesk.