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Budgeting for Profitability in 2016

Posted by Jeff Harper, President, BSG Financial Group on Sep 15, 2015 2:25:00 PM

It’s that time of year again, when financial institution management teams around the nation are in some stage of planning and budgeting for 2016.

When seeking areas for investment, non-interest income is still front and center, along with compliance and customer communications. All of these areas of potential growth can be addressed with innovative technology solutions, which will be crucial to create sustainable profitability and enhanced customer service for next year and beyond.

According to a recent study by Cornerstone Advisors, roughly half of community banks and credit unions will spend slightly more on IT in 2015 than they did in 2014. This growing trend in technology investment is likely to increase even more next year.

To that end, many a CEO/CFO would like to find that “ace in the hole” line item project that will deliver an immediate increase in revenue without taxing compliance or IT resources. Listed below are two such solutions that your management team should consider. (You can download a complete list here: 'Four Surefire Ways to Improve Your Financial Institution's Performance.')

Each solution has proven successful in helping other financial institutions just like yours generate non-interest income; streamline processes; or maintain compliance without compromising their financial institution's resources.

Solution #1: Profitable, Personalized Checking Accounts

Get out of the “free checking” bind that can cost your institution $250 to $400 per account annually to sustain. Instead, offer a fee-based checking account that is enhanced with value-add products and services that are important to the customer, who will pay a small fee for extras they find useful.

Bundled, fee-based accounts can include benefits like:

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Topics: Fee-Based Checking, Courtesy Overdraft, Non-Interest Income, Budgeting

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