Two items clearly stand out as the most troubling issues concerning profitability. But, interest rates and regulatory issues are out of your control.  So, what’s a financial institution to do?

I’m still geeking-out on the Bank Director 2015 Growth Strategy Survey! 

In addition to the thoughts on Millennials that the survey raised, another survey question stood out to me…

Which factors have had the most negative impact on profitability for your institution over the past 12 months?

  • Low interest rates: 70%
  • High cost of regulatory compliance: 64%
  • Lack of sufficient fee income: 35% 
  • Inefficiencies: 28%
  • Constraints on loan growth: 21% 
  • Branch network too large/broad: 15%

A few weeks ago, I wrote about pre-work that you need to do before your next planning session. Add this question to your list!!!

But before you get too far, repeat after me…

Grant me the serenity to accept the things I cannot change; 
courage to change the things I can; 
and wisdom to know the difference.

Two items clearly stand out as the most troubling issues concerning profitability. But, interest rates and regulatory issues are out of your control.  So, what’s a financial institution to do?  

Where do you focus your efforts?

You see it on Facebook, hear it in the office and watch it on the news every day … People complaining about what they cannot control.

If rates and regs are biting into your bottom line, where can you make it up?

  • Can you increase GAP, debt cancellation and auto deductible reimbursement sales for auto loans?
  • Are you packaging higher-interest credit cards with every mortgage closed? Don’t customers need to buy new stuff for the new crib?
  • Can you replace a branch with an Interactive Teller Machine (ITM), kiosk or Omni-branch?
  • Would a centralized call center increase productivity?
  • How can you decrease in-branch transactions and increase in-branch relationships?!?

There are a million things you CAN do. Ask yourself what is impacting your profitability so you know the handful of items you SHOULD focus on.

For more articles to get you ready for strategic planning check these out:
Marketing’s Vital Role in Strategic Planning
I know I’m biased, but the Marketing Department, in my opinion, plays the most important role in your upcoming Strategic Planning session.

FOCUS, Momentum, Results
On any given day, there are a million strategies that you can focus on. The trick is to identify the handful of strategies that you should focus on. 

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