2016 National State of Financial & Economic Education

April 26, 2016

Every two years, the Council for Economic Education (CEE) comprehensively reviews the state of K-12 economic and financial education in the United States, collecting data from all 50 states and the District of Columbia.

FI Highlight: Rivermark Community Credit Union

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We recently spoke to Rob Mills, Vice President of Technology at Rivermark Community Credit Union to discuss the credit union’s new digital banking experience, how they “fail faster,” and how they continue to evolve...

Cause and Effect: If you build it, will they come?

July 23, 2014
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Many financial institutions assume that digital banking is lucrative because the most valuable customers happen to bank online. While there is certainly a correlation between online bankers and higher profitability, quantitative evidence suggests that...

Intuit 2020 Report: The Future of Financial Services

April 11, 2011
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Today, Intuit released the latest edition of the Intuit 2020 report, Intuit 2020 Report: The Future of Financial Services, which identifies and examines four key trend areas that will  transform the financial services industry...

Fast Facts: Student Loans

January 22, 2013
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The Financial Services Roundtable recently released another iteration of its Fast Facts, reliable, bullet-point research about issues facing the financial services industry. Topics span TARP, Dodd-Frank, insurance, lending, retirement savings and more.  Below are some updated Fast...

The Top 10 Trends in the Digital Banking Industry

December 18, 2013
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Making Banking Fun: Gamification in Financial Services

August 5, 2013
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Technology M&As: The Beats Go On

May 29, 2014
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The ongoing fascination with Apple’s $3 billion purchase of Beats Electronics is entirely understandable, because it’s a cool story. However, it also says a lot about what’s going on between finance and tech.

What We’re Reading

May 5, 2011
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Below are interesting stories the Banking.com staff has been reading over the past week. What have you been reading? Let us know in the comments section below. Virtual Banking Worlds Provide Tangible Lessons American...

Small Business: Perception vs. Reality

November 21, 2012
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In the most recent election cycle, like most others before it, the one sector of the economy that got the most attention was small business.  This is the future, we were told by every...

What We’re Reading: Thanksgiving Edition

November 22, 2012
/   Spotlight

Below are interesting stories the Banking.com staff has been reading over the past week. What have you been reading? Let us know in the comments section below or Tweet @bankingdotcom. Mobile Thursday? Plans for Thanksgiving...

A defining characteristic of the banking industry over the past several years has been change, and one of the biggest changes is the way customers interact with their bank. The advent and advancement of online and mobile banking have decreased the number of trips customers make to the branch, as well as the number of transactions they perform while in the branch. This decrease in activity has threatened the profitability of many branches.

To restore their profitability, banks have to transform their branches into streamlined institutions prepared to meet customers’ needs efficiently. As banks prepare to undergo the transformation process, they should be sure to make data-driven decisions about where their customers are, what they need and how best to serve them in the branch.

The Current Environment
A FMSI 2015 Teller Line Study showed large decreases in the number of customers per branch, as well as a decrease in the number of in-branch transactions.

With such a decrease in traffic to the branch, it is important to understand why customers do go to the branch. Typically, customer activity can be placed into one of two categories: transactional and advisory/sales. Transactional activity has largely been automated or outsourced to ATMs, online and mobile banking. Customers no longer need to go to the branch for their day to day, or even month-to-month, banking needs. However, when customers are planning larger financial decisions, like taking out a mortgage or other loan, setting up investment accounts or seeking general financial advice, they do tend to go to the branch for in-person meetings. Following this trend, successful branches will shift their focus from low-value transactional activities to advisory and sales activities.

Data Driven Decisions
Before a bank begins to transform their branches, they need to know which branches to work on, and what changes will be most impactful at those branches. In order to make meaningful decisions to improve branch profitability, the bank must utilize a data-centric approach to examining its branches and deciding what changes to make.

The first thing a bank needs to know when examining its branches for transformation is why some of its branches may be performing better than others. The biggest predictor of success for a branch is location: is the branch located near other retail businesses, like shopping centers, or in more residential areas? Is it accessible? Likewise, if a bank has a focus on small business lending, does it have branches in proximity to those businesses? Looking at the environment that surrounds successful – and not so successful – branches can provide insight into what kind of environment works best for a particular bank.

Another data point that can provide some insight into a best branch strategy is the demographics of the bank’s customers. In particular, look at demographics including

  • Age of customers
  • Average income
  • Education levels attained
  • Even languages spoken

These kinds of data points can guide branch transformation decisions such as the level of personal service versus high tech automation that customers would prefer, what kind of services customers are most likely to be interested in and what special accommodations the branch should provide (e.g., multi-lingual staff or accessible facilities).

Conclusion
Change in the banking industry is inevitable, and only those banks that are willing to change along with the times will find that they are ultimately successful. Making the right changes can be hugely impactful in a branch’s performance. The key to making the right enhancements to your branch is to make decisions driven by data. Knowing which branches to change and in what ways to change them is an integral step towards operating a profitable branch and institution.

About Elise Hauser: Elise Hauser is a product manager for Sageworks Bank Information, which provides easy-to-access data on US banks and credit unions. Within Bank Information she manages Content and Education, which allows Bank Information to provide thought leadership in the banking industry.

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Voices

Compelling voices and contributed content from around the web

James W. Gabberty

Gabberty is a professor of information systems at Pace University in New York City. An alumnus of the Massachusetts Institute of Technology and New York University Polytechnic Institute, he has served as an expert witness in telecommunication and information security at the federal and state levels and holds numerous certifications from SANS & ISACA.

Zachary Ehrlich

25-year-old writer, and as a native San Franciscan, I am unreasonably loyal to Bank of America, if only for their superhero-like origin story, involving the 1906 earthquake and Italian fruit vendors.

Brad Strothkamp

http://www.forrester.com/rb/analyst/brad_strothkamp

Marisa Mann

Marisa Mann brings over 15 years of experience in consulting and financial services industries to the Solstice team, working on large scale enterprise initiatives across many technologies, including specializing in the digital space – Internet and mobile. Mann is passionate about mobile and the endless possibilities for the enterprise, delivering business value through strong brand recognition and driving to excellence in the consumer experience. Prior to Solstice, Mann worked at JP Morgan Chase, Diamond Management and Technology Consultants, Washington Mutual, Inc, and Accenture.