Banking

Legislators have introduced few new tax developments specific to the banking industry in the past year. Banks end 2015 contending with a handful of ongoing legislative issues that impact critical decisions. Of those, the timing and extension of the tax extenders package is perhaps the most pressing. A failure or delay by Congress to pass this legislation means uncertainty for community banks as well as for the businesses and families they serve.

In 1992, the Green Bay Packers starting quarterback suffered an injury. Brett Favre stepped in and the team never missed a beat. Sixteen years later as Favre approached retirement, Aaron Rodgers took the starting position. The team continued a legacy of strong leadership.

The internal audit function can be a powerful resource for creating competitive advantages and driving growth. It’s relatively intuitive to consider how identifying efficiencies and mitigating risk can aid in the sustainability of an organization. A deeper look at the internal audit (IA) process reveals that it is also incredibly effective for nurturing a strong bank culture during an M&A transaction. 

Let’s begin today with a brief multiple choice quiz. Internal audit allows your financial institution to do which of the following:

1. Increase revenue production

2. Cut costs

3. Produce reliable numbers for informed decisions

4. Increase efficiencies

5. Reduce fraud risk

6. All of the above 

Community banks have many strong assets that offer every reason for optimism. Even in the face of technology change, new demographics and increasing globalization of services, these smaller, local institutions have a host of leverageable assets.[1]

Internal audit is an objective source of confidence for stakeholders, and proof that your bank is compliant and prepared for the future. Typically, an internal auditor will focus on things like reputation, growth, and corporate governance by keeping sight of controls and management, risk, and operations. The most valuable and effective internal auditors, however, go beyond those functions. They help the bank to stay aware of business trends and remain anticipatory so you are equipped and prepared for upcoming challenges, risks, and opportunities.

Chances are, you’re reading this blog on your phone or tablet. We reached the tipping point for mobile use in the US in the past year. While studies vary slightly, most report approximately 66% of email is opened and read on smartphones (versus 34% on desktop), and time spent engaged with digital media is 51% for mobile (compared to 42% for desktop). And while these reports are specific to media consumption, many others provide evidence that we are a truly connected population, using tablets and smartphones in every corner of life, from communicating to helping with homework, to paying bills, to teleworking. 

The competitive spirit is a driving force that pushes each of us to reach unimaginable heights. It’s also what makes sports stories so endearing – particularly those where an underdog overcomes great obstacles to win.  I particularly like this quote from Rocky Balboa (Sylvester Stallone) in the movie Rocky: 

Not long ago, we examined the value and importance of a healthy bank culture.  In it, we shared the HORNE Wise Firm model, which is based on the belief that a strong foundation is built on the combination of ‘we’ and ‘service’ – a cultural belief in working together to make a difference. We also shared some powerful statistics that indicate per-employee profit increases from $7,802 to $27,401 in organizations with a shared culture based on vision, mission, and values. 

Last week at the 40^th annual AICPA “National Conference on Banks & Savings Institutions” in Washington, DC, change was on everyone’s mind. The conference coincided with the second Republican primary debate and the even bigger debate about whether the Federal Reserve would raise interest rates for the first time in almost a decade. 

Recently, we discussed the changes impacting the banking industry as non-bank companies have begun to employ investor funding and new automated models to underwrite loans with unprecedented efficiency. In the short time since this competition emerged in the marketplace, it has had a significant impact on consumer, mortgage, and small business lending.

I recently had the pleasure of having dinner with Senator Richard Shelby (R-AL). We were in Dallas, preparing to watch our shared alma mater, the Crimson Tide of Alabama, take on the Wisconsin Badgers. It was a great honor to connect with a man who has meant so much to the state where I was born, and who continues to work hard for the banking industry.

Employees need to feel inspired by the company mission and values, because raw talent is meaningless without the will to create results. - KISSMetrics