Marketing for Banks Through Exceptional Annual Reports

Due to regulatory requirements, banks need to produce and release a bank annual report each year, which undoubtedly entails an ample amount of time, money and stress. So why not put all your effort to extra beneficial use and treat your annual report as a practical bank marketing tool, drawing something back to your bank in return?

Customarily, bank annual reports include such content as financial details, balance sheets, and CEO’s and chairperson’s reports. But if you view your annual report as a part of your bank’s overall marketing plan, you’ll find there are ways that your content can be presented in a more useful and enlightening manner and elements can be included that can enhance the marketing impact of your bank annual report. After all, whoever reads your report will consider it a representation of your bank and will likely make assumptions about your financial institution based on what is conveyed in your report.

Boost the marketing power of your bank annual report with any of the following elements:

• Specific statements of your goals or vision. An expression of your bank’s aims or vision should be clearly stated and woven into various articles and letters throughout the report. Keep your statements positive and easy to understand so people get a clear picture of your passion and vision.

• Summaries of your bank’s successes and achievements. Marketing for banks via an annual report should include not only who you are, but also what you have done over the past year. Presenting what you’ve done and how your bank has achieved its goals portrays your bank as an ambitious, go-getting organization that successfully puts its plans into action. Additionally, if people see their money and support being used in beneficial ways, they will be more likely to continue doing so in the future.

• Overview of community involvement, charitable giving and support. People respect and appreciate when any organization gives back to the community in which they live, work and raise their families. So if your bank or employees donated money, time or services to the community, be sure to explain it in your annual report. Your generosity won’t go unnoticed!

• Case studies or customer testimonials. Case studies and testimonials that exhibit the positive results of your bank’s service are helpful in demonstrating the outcomes of your efforts, and they also show the warmer, human side of your financial institution.

• Future plans. Including an announcement of your bank’s future plans is a vital marketing tool that shows you’re a forward-looking financial institution with a vision toward future success. These initiates could be included in the CEO’s or chairperson’s report.

• Names of board and committee members, donors, sponsors, supporters, helpers, etc. These people deserve to be recognized in your bank annual report. Listing their names – or better yet, thanking them – shows that you value each and every one of them and the contributions they made. Just remember that while you want to include as many names as possible, be sure to do so in the most concise manner possible.

• Photos. People love putting faces to names so try to include pictures whenever possible. Make sure the photos you plan to use are of high quality, or consider hiring a professional photographer to take new ones.

• Contact information. Help people get in touch with your bank by including all of your contact information such as address, phone number, fax number, website and email address. These details can be presented on the back cover of your report.

Clearly, marketing for banks through informative, inspiring annual reports is a no-brainer. With a few additions and adjustments, your bank annual report can become more than a mere financial summary, transforming into a useful tool that acts as a supplement to your existing marketing materials, tells a narrative about your bank and its vision, and proves to readers that you deserve their trust and support.

The Mega Banks Are About to Lap You

Are You Leveraging Your Agility and Personal Service Enough?

For years the largest banks relied on mergers and acquisitions (M&A) to reach and exceed stock market expectations. In fact, when you look at Bank of America, Citigroup, Wells Fargo and JP Morgan Chase, they collectively represented 35 separate companies in 1990.

In recent times the strict regulatory environment has discouraged these very banks from growing through acquisition-completely realigning their focus towards organic growth. The management teams had to find a way to develop effective revenue gains and expense reduction programs to generate billions, or fail to meet stockholder and investment market expectations.

Some of these banks have risen to the challenge, including Wells Fargo, who had the best efficiency ratio of all the largest banks, at just 59 percent in Q4 2014. While its peers did not come close to this ratio due to a litany of reasons, it is safe to assume they are diligently working towards improving.

This is bad news for the thousands of other financial institutions, who historically have reaped the benefits when larger banks alienate account holders through poor customer service or higher fees- often times resulting from circumstances stemming from a strong M&A culture.

The community banks and credit unions who do not properly implement improvement strategies are at a greater risk of being left behind in the market. This article will provide tips on staying ahead of the mega banks, by leveraging the natural advantages smaller institutions have-including agility and personal service.

Agility in Creating Efficiency Programs

When you are dealing with tens of thousands of employees, and several approval layers, it can take years to implement a new efficiency program. Conversely, an initiative like workforce optimization or realigning branch hours, can take as little as a couple of months to get underway and running for smaller institutions. Despite this advantage, there is evidence that as a whole most community banks and credit unions are not taking advantage of more effectively managing their workforce optimization programs.

Per the FDIC and NCUA, noninterest expenses were up 3.1 percent for both community banks and credit unions from 2013 Q4 to 2014 Q4. The FDIC attributed much of this increase to higher employee salary and benefits, which was up 6.5 percent in the same period. Furthermore, despite a shrinking year-over-year transaction trend in the branches, the FDIC reported an actual 1.2 percent increase in full-time employees at community banks from a year earlier. What was your year-over-year full-time employee trend?

Having a dedicated workforce management program can help you fine-tune the highest non-interest operating expense, the staff in your branch network. By aligning the right number of staff at the right place and time based on forecasted transactions and interactions, you will see marked difference in employee productivity and labor cost per transaction and interaction levels. It is not uncommon for mega banks to have very expensive proprietary systems and dedicated full-time managers handling their workforce initiative-light-years ahead of the annual spread sheet review often seen in smaller institutions.

Perhaps the simplest improvement effort to implement for smaller and more agile banks and credit unions is trimming branch daily hours of operation or close on a Saturday, if sluggish business volumes warrant. Such changes appear minor to account holders, but can produce dramatic results. In 2012, a 21-branch, Illinois-based bank perform such an analysis across its entire branch network. As a result, the bank trimmed nearly 1,300 weekly labor hours in its branch network for an estimated annualized labor cost savings of more than $1.2 million.

Personal Service – The Big Differentiator

We hear it all the time, ‘our service is what separates us from the rest,’ and it is a rallying call that has helped community banks and credit unions earn new account holders for decades.

Just in the last few years SNL Financial reported the six largest banks paying $123.5 billion in financial settlements over faulty mortgages alone. This undoubtedly alienated many customers who many likely turned to smaller institutions. Additionally, there are thousands more who have had poor service experiences at mega banks on a month-to-month basis.

However, I predict a decline in these poor service experiences at mega banks in the years to come, making it more difficult for community banks and credit unions to rely on great personal service to differentiate themselves. With hundreds of millions of dollars to invest in new service-based technologies, like appointment setting systems and enhanced self-service devices, the mega banks will assuredly make greater strides in impressing their customers with remarkable experiences.

A solution to combat these market developments is to take what already is great at smaller institutions-outstanding personal service-and leverage technology to make it even better. The following are two such technologies:

1. Utilizing lobby management systems, can help institutions improve the lobby experience while capturing valuable service and sales intelligence in the process. This type of technology enhances personal service by streamlining the account holder visit, and helps to improve staff performance through identifying and implementing targeted coaching activities.

2. Adopt cash recyclers to shore up time in the branch in order to effectively roll-out universal associate branches. Universal associate interactions will increase both cross-selling and service.

The mega banks are being forced to rethink many of their strategies. Bank of America recently reported nearly a 78 percent efficiency ratio, a number several points higher than the next bank on the list. They have talented employees, deep pockets and a large customer base, but what they do not have is the agility and exceptional personal service smaller institutions have. The community banks and credit unions that fully leverage these two significant advantages will likely double, triple or even quadruple in size in the years to come.

Money and Banking – How a Reserve Bank Creates Money

There is a common misnomer that money is created on a printing press. While it is true that a few notes are printed and used in commerce, the vast majority of money in circulation does not even have the soundness of paper notes. All but a very small percentage of money is nothing more than ledger entries on a bank computer.

When a central reserve bank needs to buy a stapler or desk, it writes a check to the supplier and takes receipt of the good. The supplier deposits the check in a commercial bank, and the commercial bank forwards the check to the reserve bank for payment. The reserve bank uses the check to erase the liability created when the check was written and credits the amount of the check to the commercial bank.

Let’s follow the accounting starting with clean balance sheets.

When the central reserve bank purchases the stapler (let’s say for 10 units) by writing a check, the reserve bank’s assets increase by one 10-unit stapler, and its liabilities increase by 10 units. The supplier increases both his assets and owner’s equity by 10 units less the cost of the stapler to him.

When the stapler supplier deposits the check with his commercial bank, the commercial bank increases both its assets and liabilities by 10 units. When presented to the reserve bank for payment, the reserve bank records the deposit as an increase in assets of 10 units and an accounts payable liability (the commercial bank’s account) of 10 units. Since the check has been paid, it is canceled along with the 10-unit liability it created.

By writing a check presentable only to itself, the reserve bank has just created 10 monetary units out of thin air. With a few keystrokes, the money supply has just been inflated by the 10 units the stapler supplier now has on deposit at his commercial bank. Unfortunately, the inflation doesn’t stop there.

For every unit a commercial bank has on deposit at the central reserve bank, they can loan out .9 units. Since our example commercial bank now has 10 units on deposit at the reserve bank, it can make a 9-unit loan simply by writing another check. If that check is deposited at another commercial bank, the second commercial bank will present that check to the reserve bank for payment. The reserve bank will move 9 units from the first commercial bank’s account to the second commercial bank’s account and cancel the check.

Now, the stapler supplier and the recipient of the loan proceeds have total bank deposits of 19 units. Of course, the money inflation doesn’t even stop there. The second commercial bank can now loan 8.1 units to another bank which can then loan 7.2 units to another bank and so on until the total money supply has been increased by 100 units all without ever turning on a single printing press.

Of course, a central bank can only use so many staplers. The most effective method a central reserve bank has of creating money is by purchasing government bonds. Since government borrowing is ubiquitous, a reserve bank can easily purchase these bonds on the open market. The problem with this, though, is that it amounts to a double tax on the people of that country.

The people are taxed once to repay the bond and interest and a second time in the reduced purchasing power of their money. While the costs of this scheme are borne by the people, the benefits are realized solely by politicians and the individuals and corporations who contract with the government. By the time the newly-created money filters through government, government contractors, and banks, the wage-earner derives little increase in his standard of living if not an outright decrease.

The central reserve bank is both the lynch pin and Achilles heel of a fractional reserve banking system. Monetarist economists claim a central bank is required to promote economic stability and growth in the economy; any costs, they maintain, are outweighed by the benefits. Very few monetarists explain, though, that the bearers of the cost and receivers of the benefits are not the same people. By shrouding a reserve bank in an “official” cloak, bankers and economists fool people into believing that a little ink and paper and a lot of digits on a computer screen is just as good as sound money.

Offshore Banking – Extra Services Private Banks Offer That You Never Knew Existed!

Products offered by banks around the world are broadly the same, though they often go under different names. However, there are products you might come across in the offshore arena that you may not be entirely familiar with. In fact, you may not have known that such wondrous possibilities existed! Here are a few definitions and explanations.

Safe Deposit Boxes

A safe deposit box is a locked box reserved for you in the vault of your bank. It’s a place where you can keep small, high-value items. People typically use safe deposit boxes for documents such as physical stocks or bonds, or for small, high value goods that they want to keep safe… like valuable coins, jewelry or maybe a stash of microchips. You might keep these items for pure investment purposes – say gold bullion or uncut rough diamonds – or for more sentimental reasons (your great-grandmother’s wedding jewelry for example).

Typically you will keep the keys to the box, while the bank controls access to the vault where all the boxes are located. Normally the bank does not keep a duplicate key… so if you lose the key you will have to pay for a specialist locksmith to come in and break open the box, then you’ll have to buy the bank a new box too. Needless to say this is expensive, so do take care of your keys!

Multi-Currency Accounts vs. Multiple Currency Accounts

Different banks (and different countries) maintain different accounting systems.

Multi-currency accounts are quite common in offshore banks. These are very flexible in that they allow you to keep many different currencies in the same account. You have just one account number, but when you look at your statement on the internet you will see different balances… X amount of US dollars, Y amount of Euros etc. If you send a transfer to a multi-currency account, the bank will typically keep the deposit in the currency received, rather than converting it to any particular default currency.

Other banks also allow you to hold balances in different currencies, but operate on a different system – a separate account number for each currency. This means that, if you wish to operate in a number of different currencies, you need to maintain multiple accounts. The net result is basically the same, but you will have a series of account numbers and you must take care not to confuse them. For example, if you send US dollars to the Euro account number, the bank will assume you want to convert that balance to Euros and will do so without informing you.

Precious Metals Storage

Many prudent investors have invested in assets like gold and silver and have made huge returns on their money over the past few years as commodity prices have shot through the roof. Perhaps strangely, however, if you ask the average banker how to buy gold, they don’t know – so they will tell you it is not a good investment. Sometimes it pays to be insistent!

Some banks offer a basic service where you can buy gold and simply store it in your safe deposit box. This certainly works, but may not be the most practical way of handling it. Why? Because each time you want to buy or sell, you have to visit the bank personally. Only you have access to your box. Fine if it’s around the corner, but not if it’s around the world.

There are various other practical ways of buying gold such as Perth Mint Certificates or Exchange Traded Funds, but the security of such investments in the current financial climate is debatable. There is really no substitute for cold, hard gold in a secret secure vault!

However for the purposes of this article and understanding offshore banking products generally, suffice to say it’s important to understand the difference between allocated storage, and unallocated – also known as pooled storage. Both these systems are used by private offshore banks.

“Allocated” means that a certain piece of metal (specific gold bars, coins or whatever) belongs to you. The metals are stored in the bank’s general vault, rather than in a specific safe deposit boxes, but they are specifically allocated as your assets. For practical purposes, therefore, you can instruct the bank to buy and sell on your behalf without you having to travel there.

“Unallocated” or “pooled” storage means that the bank simply has X amount of gold in its vault, and allocates so many grams, ounces or kilos to your account as part of a book-keeping exercise. But the banker cannot in this case take you down to the vault and point out your specific gold bar. Again you can instruct the bank to buy and sell on your behalf.

Allocated storage of course is better, but pooled storage tends to work out a lot cheaper in terms of the actual fees the bank charges for taking care of the metals in its vault.

Numbered Accounts

Numbered accounts (or pseudonymous accounts, which are the same but are known by code words instead of numbers) are not all that different from normal bank accounts. The usual account records, such as statements and what regular bank staff can see in their computers, omit reference to the customer’s name or other identifying information, replacing it with a code number or the pseudonym. The relationship between the code number or pseudonym and the actual customer is known only to a few senior managers within the bank.

It is important to emphasize that the bank has an obligation to know the true identity of both the account holder and its beneficial owner. There is no such thing as an anonymous account.

Typically the way numbered accounts work these days is that you will have a numbered account and a regular account in the same bank. Numbered accounts cannot normally be used for regular transactions such as wire transfers or checking. So when you want to make a deposit or withdrawal, your private banker will personally carry out a cash transaction at the counter between the two accounts. In the accounting records, the transaction will appear on your personal account as a cash deposit or withdrawal, so there will be no direct link to your numbered account.

Of course, within reason and subject to normal limits, you can carry out cash transactions directly on the numbered account.

Brokerage Accounts

A regular bank or ‘cash’ account is simply used for depositing and transacting in a currency such as pounds, dollars or francs. Your brokerage account, however, can be used for buying stocks, funds and other investments on the world markets. The brokerage account may be stand-alone, or may be linked to your offshore bank account in the same institution. Either way, you will typically have to transfer funds from the cash account to the brokerage account before you can buy stocks.

Offshore Credit and Debit Cards

Almost all offshore banks will offer you the option of linking some kind of plastic payment card to your account. This may be anything from an unbranded hole-in-the-wall cash card through to a premium travel and entertainment card like the Platinum American Express or Diners Club cards. The most common brands, of course, are Visa and MasterCard, and there are even more variations on these cards than there are banks in the world!

You personal banker will be happy to explain the range of cards available and what are the principal differences between products like debit cards, deferred debit cards, secured credit cards and so on.

What your banker will not explain, however, is that you may well be able to enhance your privacy by obtaining a card from a completely different bank.

Why? Because the moment you use a card issued in your name by your principal offshore bank, you are creating a permanent electronic trail in the systems of the card network operator (for example Visa). So your banking records are no longer exclusively held by your offshore bank. The card networks typically process data all over the world, exposing it to numerous jurisdictions where investigators might be tempted to go on fishing trips.

Anonymous Cash Cards

Like numbered accounts, anonymous cash cards do still exist, but there is a lot of hearsay and legend surrounding them. Here are the facts.

By anonymous cash card we refer to a plastic card which, together with a PIN code, can be used for withdrawing cash in automated teller machines around the world. It can also be used sometimes in merchants such as supermarkets, but acceptance is generally limited to certain locations. It’s anonymous because, unlike normal credit and debit cards, there is no name printed on the card nor encoded on the magnetic strip.

It is not 100% anonymous, however. You do have to show ID to obtain such a card in the first place, and you also have to comply with all regular know your customer and due diligence rules. There are also strict withdrawal limits. These restrictions are necessary to make sure the card issuing bank operates legally and to ensure that the cards are not abused by money launderers.

There is one very, very big advantage to the anonymous cash card. That is when you use it internationally, the transaction is processed only based on the card number. The card network operator does not know who you are. The due diligence information (like passport copy) that you have provided is stored safely offshore in the card issuer’s office, away from prying eyes and protected by strict banking privacy laws. This is in stark contrast to regular international debit cards which have names not just printed on the card but also embedded in the magnetic strip so the name can be captured electronically.

Another advantage of the anonymous cash card is that should it fall into the wrong hands, the loss is minimal. ID theft is not possible when the card is anonymous! Without the PIN (which hopefully you have stored only in your head) the card is useless. There is no chance somebody could empty out your offshore account before you notice the card is missing. And, because it’s a stand-alone card, there is no chance that somebody could find out even the country, let alone the actual bank, where your principal offshore account is held. All you have to do is make one phone call and the card can be canceled and replaced.

Finally, another advantage is legally avoiding reporting requirements. Anonymous cash cards do not class as a bank account. They are regarded as prepaid products, something between the electronic equivalent of a traveler’s cheque and a prepaid phone card. So if your country requires you to report offshore accounts, you don’t need necessarily need to report an offshore anonymous cash card. Note: this report is prepared for a global readership. Some countries may have differing rules in this regard. If you are not sure about the reporting requirements in your country of residence, please check with your local tax authorities or a professional qualified in your jurisdiction.

You might be wondering how, if the card is not linked to your principal bank account, you can withdraw money from it? Simple: it is a prepaid product. You prepay, by means of an offshore wire transfer, an amount you are likely need over the period you determine. You can keep these transfer amounts relatively low so they remain under the radar.

Infinite Banking System – Financial Rewards Through Personal Banking

Here’s a shocking fact about money– the average American spends about 60% of his or her lifetime earnings on taxes and interest payments. That means that for every $100 you earn, $60 of it is never really yours. It’s paying the government, the bank you borrowed money from, and any other institution to which you’re paying interest.

You may be thinking, “Well, that’s just the way it is.” But it doesn’t have to be. With the Infinite Banking System you can break the cycle of paying money to someone else, and start paying it to yourself.

What Is Infinite Banking?
The Infinite Banking System is a financial philosophy of being your own bank. It means taking more control of your financial dealings, not just handing them over to some financial advisor or institution. Infinite Banking takes structure and discipline, but the rewards are numerous.

Let’s start by discussing the financial “norm”. Most people, when seeking a mortgage or financing the purchase of a new car, will turn to a bank or other financial institution. In the traditional banking system, there are three major players: the Saver, the Borrower, and the Banker.

The Saver deposits money with the bank and earns interest on his or her money; the Borrower borrows money from the bank and pays interest on the money borrowed. The Bank is just the intermediary. For its effort, the bank charges higher interest to the borrower than it pays to the saver. This is called the spread, and is how banks make their money.

What the Infinite Banking System does is make you the bank. You will save with your bank, you will borrow from your bank, and when you pay interest on your personal loans, you’ll be paying yourself–because you’re the bank.

Sound complicated?

It’s not! The infinite banking concept predicates on the idea of cutting out the middleman–the bank. With Infinite Banking you can save with and borrow from yourself. And when you pay yourself back, you are paying back your personal loan plus the interest to yourself.

Getting Started with Infinite Banking
So how do you become your own bank and begin financing yourself?

With whole life insurance. Specifically, it’s a dividend paying whole-life insurance policy. The Infinite Banking system is built on this financial tool and it allows many possibilities for financial stability and success.

To start, whole life insurance has been a proven winning financial tool since the inception of life insurance. Whole life insurance policies are carried by:

o the wealthy to protect their estates
o ordinary families to protect their assets
o corporations, and
o almost every major bank.

In fact, in 2008, bank owned life insurance (BOLI) grew by $126.1 billion. So the product is a proven winner.

When using whole life insurance as a personal banking system, the policy is structured differently. The Infinite Banking system’s whole life policy is structured to maximize liquid cash values instead of concentrating on the death benefit. Which means you can enjoy your money now and still leave a financial legacy for your heirs.

The Benefits of a Dividend-Paying Whole Life Policy
A dividend-paying whole life insurance policy allows you to take policy loans from the cash values within your policy. You control these funds and dictate the re-payment terms. That means you set the interest rate, the amortization period and other loan terms. It might be tempting to think that the best thing about this is no paperwork! (Have you applied for a loan lately?). But in fact, the best thing about this is that when you borrow from yourself, you also pay yourself back. You pay back the loan, you pay yourself interest, and you do it all on your schedule. There are no penalties for a late or missed payment. And there are no loan fees or other transaction fees. Remember, you are now the bank!

There are numerous other benefits to the infinite banking concept. A properly structured dividend paying whole life insurance policy offers tax-deferred growth of money, and tax-free distributions via policy loans. Non-loan withdrawals from the account are tax-free up to your basis, or the amount you have contributed into the account.

With the Infinite Banking System, cash value growth within the account accumulates tax-free. Additionally, the death benefit proceeds pass to your heirs income tax-free. In fact, with proper planning, you heirs can receive the life insurance proceeds from your policy free of estate taxes.

The Infinite Banking Concept teaches independence from the conventional way of financing, meaning you will no longer be reliant upon banks and finance companies for cash or financing. If you’re ready to be your own bank, look into the Infinite Banking Concept today. With a little planning and discipline, you’ll be on your way to financial self-reliance.

Internet Banking UK – Reviewed

Banking online in the UK is now massive. It wasn’t all that long ago that it was the preserve of geeks, early adopters and those afraid of walking into banks to talk to people. Now however every one from your Mum to your technophobe mate does a lot of their banking online. It is just so simple, so convenient and saves time in our busy twenty first century lives.

One of the first banks that spearheaded Internet Banking UK was First Direct. I joined them back in 1998 having been messed around by Barclays too much, and was delighted to find their pure internet only based banking was both a pleasure to use, and was supported by a 24×7 phone banking service that got you straight through to a person, rather than a series of options pressing 1 for this 2 for that and then hold for an age. To this day, I am still with First Direct and value the personal service provided with direct line to UK based call centre staff. Anyway, I’m getting slightly off topic. The main reason I am writing this article is to express my thoughts and passion for online banking.

Over the years that major high street banks started introducing Internet Banking as a service to their customers. Some got it spot on, some came up with appalling bad sites that were not intuitive and made the experience frustrating rather than simple and easy. The online offerings of the major UK banks were also joined by other internet only off-shoots, such as Smile, Intelligent Finance (IF) and Cahoot. Of these, I did temporarily defect to Cahoot and use it for a couple of years, and whilst the basics of the site are ok, the overall service is really poor. I’m surprised they are still around, and hopefully Santander will sort them out sooner rather than later – some of the key issues being frequent outages, poor performance, lack of functionality. You can’t even download statements! They provide a part time phone banking service to back up the internet banking, so if you are having problems on a Sunday, then forget what you’re doing and call back on Monday in office hours (when most people are busy working!).

Another service becoming more common and is a great addition is mobile banking. This started with SMS alerts, which I have benefited from through First Direct for as long as I can remember, and it costs nothing (as long as you pay in at least £1500 per month the whole banking service is free). You can set up mini statements, but best of all you can have alerts with different thresholds, for example set an amount that you want to get alerted about when either a debit of credit exceeding that amount takes place. Even better, and alert that your balance is above, or below a preset amount – great to warn you early that you are either approaching a zero, or approaching your overdraft limit. These alerts can set on your First Direct Credit card too, meaning you can be alerted to any fraudulent activity on your account within 24 hours. Cahoot also provide this service but they huge miss in their offering is there are never any monetary amounts mentioned in the texts, so hey are next to useless. “Payment Alerts your account ending 1010” or “A balance alert for current account ending 5342” – Pointless.

The evolution of the SMS alert banking is of course Mobile Banking, where you can access your account details, and perform transactions on a mobile device. With the massive popularity of smart phones these days, the capability of the mobile web browser is almost the same as that of a PC based browser, so moving money and checking balances on the move has become a reality. Some of the banks provide dedicated apps, or cut down versions of their full blown internet bank sites when you visit them from an iPhone of a Symbain smart phone for example. So anywhere you have a mobile signal (i.e. 98% of the UK) and some juice in your mobile, you can do most things with your money that 15 years ago required you to walk into a high street bank during working hours. This, in my opinion is a revolution, and really puts us in control of our money.

Obviously for some people still, they like the face to face interaction, like to queue up and get a bank clerk to perform transactions (which are increasingly done on a version of the same system that is provided as the online banking service) and some people need the assistance of the banks to do what they need to do. But gradually high street banks are changing, becoming places where you can pop in to do your internet banking or phone banking, and to speak to someone regarding major new business such discussing mortgage options of life insurance/investment accounts. I even prefer to do all this online, having opened savings accounts, researched mortgages and set up child trust funds through the internet. But this is they way high street banks are going, and eventually they will start closing down more branches…

If you are with one of the major UK banks and don’t currently use online banking, it is worth your while setting up an online account. The banks can help you with this, but be warned that some of the web sites are much better than others. I’d even go as far say that it is worth considering switching banks to one that provides the most user friendly, functional, secure and fast online banking service. The other factors on current accounts such as interest rates, fees and customer service may vary, but not a lot these days. Google “Online Banking Reviews” to see what others think and how your bank is rated, and make up your own mind.

Agile Banking – Managing the Challenge of Change

Business Agility

Business agility is the ability of a business to adapt rapidly and cost efficiently in response to changes in the business environment. Business agility can be attained by maintaining and adapting goods and services to meet customer demands, adjusting to the changes in a business environment and taking advantage of human resources.

Agility in Banking

Agility in the context of banking doesn’t mean just speed in execution; it also means that the bank is nimble and flexible. Agility helps the bank to win a marathon, as opposed to a hundred meter dash.

A bank, which is agile, will be able to roll out new products at a much more rapid pace to meet the target of treating each customer as a segment of one. This rapid product development and rollout can be managed only if the bank is backed by a clear process strategy to handle product complexity and accompanying growth. This combination of product and process in an agile bank is expected to increase the quality of customer experience, which can be benchmarked using a metric of growth combined with stickiness. By growth, we mean that a bank is able to attract new customers as well as more business from existing customers. High stickiness means low customer attrition.

Hence, agility helps a bank to streamline its process such that it can roll out newer products at a rapid pace to increase the quality of customer experience, and thereby retain existing customers and attract new ones.

Types of Agility

Agility can be classified in two ways. A bank can be either Range Agile or Time Agile.

Range Agility defines the ability of the bank to broaden or shrink specific aspects of its capabilities. This also implies that the bank is able to increase or decrease the portfolio of its products and services. This can happen by simultaneously expanding or shrinking the bank’s processes and the capabilities of its people. A range agile bank will also be able to tap new and emerging platforms and channels like Social Media, which can be used to crowd source the development of products that can cater to the needs of a particular segment.

Time Agility defines the speed with which a bank can roll out new products and services to take care of the varying needs of customers. For a bank to be time agile, the processes and systems that underlie operations should be capable of handling the frequent changes in the bank’s offerings. The use of state-of-the-art banking solutions will enable the bank to turn around newer products quickly and manage diverse products and services as time progresses.

Challenge of Change

Hence, an agile bank is one that is on the move and constantly undergoing change. An agile bank will also have a large number of alliances with partners who contribute to various parts of the product and service offering. The way the change is managed will determine whether the bank succeeds at increasing customer satisfaction and profitability or ends up with a large number of offerings that add to the chaos, but not to customer satisfaction.

Some of the key steps on the journey towards agility, which will help in managing the challenge of change, are as follows:

Identify the Change Driver

The need for agility in a bank can arise from a change driver. This change driver can be internal or external. External change drivers arise from factors over which the bank has almost no control, like a reduction in margin because of a hike in interest rates, or an increased regulatory compliance burden on account of heightened Central Bank norms. Internal change drivers can arise from factors such as merger and acquisition or a reduction in workforce. The driver of agility needs to be identified and communicated clearly within the bank and to all its stakeholders.

Identify the Agility Enablers

After identifying the change drivers, the bank needs to identify the agility enablers against each. The current and target states need to be identified for each of these drivers as well as the enablers that will take the bank to its target. For instance, the loss of customers due to the unavailability of mobile banking, can be a change driver. The agility enabler in this case could be the adoption of a new technology solution for Mobile Banking. Another driver could be the need to reduce the waiting time at the teller window. The agility enabler in this case could be service automation through an ATM or kiosk, supported by IT infrastructure at the backend.

Strategy Formulation and People Management

The top management of the bank needs to identify the strategy for each of these enablers and communicate the same to the unit or department concerned. In each unit, a core team must be formed to manage the transition, as well as communicate with the people within. More often, the strategy formulated by the bank must encompass the change in its technology landscape. The bank might replace the legacy systems with the latest Banking system to cover its end to end operations. This might necessitate developing the skills of the bank’s employees. Hence, every strategy formulated to reach the target state of an agility enabler must consider the people dimension, especially from the standpoint of minimizing chaos.

Effective Business Process Management

The business processes needs to be clearly documented; in the case of an agile bank, Business Process Management (BPM) needs to be constantly updated, preferably by the people who carry out the business processes. The business rules, constraints, processes and policies need to be documented as part of BPM. The generation of business process maps is not a one-time activity and will constantly undergo change as the bank changes its products and processes to become more range agile. Hence, it is prudent to identify the owners for each business process, who will be responsible for keeping the process documentation up to date. An enterprise BPM solution will help the bank in managing business processes and also making them accessible to all their respective stakeholders.

Effective Decision Making

An agile bank, working in a dynamic business environment, needs to respond to change to tap growth opportunities. The effectiveness of decision-making will determine the quality of the response. The performance metrics and data relevant to the bank need to be extracted and presented within the shortest possible lead time for agile decision making. The best-in-class IT solutions for banks come with their own analytics solutions, capable of generating the data required for analysis, at a click. If there are multiple enterprise systems and multiple subsidiaries operating within the bank, it is worth exploring an Enterprise Decision Dashboard (EDD). An EDD will have the data extraction and presentation capabilities to take the output from multiple systems and present it to the decision makers.

Review and Monitoring

A steering committee consisting of the CXOs of the bank needs to be formed, and charged with conducting periodic review and directing course correction if required, in the journey towards agility. Under the steering committee, a core team comprising members from each concerned SBU or department must be formed that will drive and monitor the progress made in their respective departments.

Conclusion

The journey towards making a bank agile involves changes, which affect its people, processes and products. This is accompanied by a change in its technology landscape to facilitate rapid innovation and transformation. These changes needs to be carefully calibrated and managed so that the bank’s existing customers do not feel any adverse impact and the bank also attains a larger market share and higher customer satisfaction at the end of the journey.

Is My Money Safe? On The Soundness Of Our Banks

Banks are institutions wherein miracles happen regularly. We rarely entrust our money to anyone but ourselves – and our banks. Despite a very chequered history of mismanagement, corruption, false promises and representations, delusions and behavioural inconsistency – banks still succeed to motivate us to give them our money. Partly it is the feeling that there is safety in numbers. The fashionable term today is “moral hazard”. The implicit guarantees of the state and of other financial institutions moves us to take risks which we would, otherwise, have avoided. Partly it is the sophistication of the banks in marketing and promoting themselves and their products. Glossy brochures, professional computer and video presentations and vast, shrine-like, real estate complexes all serve to enhance the image of the banks as the temples of the new religion of money.

But what is behind all this? How can we judge the soundness of our banks? In other words, how can we tell if our money is safely tucked away in a safe haven?

The reflex is to go to the bank’s balance sheets. Banks and balance sheets have been both invented in their modern form in the 15th century. A balance sheet, coupled with other financial statements is supposed to provide us with a true and full picture of the health of the bank, its past and its long-term prospects. The surprising thing is that – despite common opinion – it does. The less surprising element is that it is rather useless unless you know how to read it.

Financial Statements (Income – aka Profit and Loss – Statement, Cash Flow Statement and Balance Sheet) come in many forms. Sometimes they conform to Western accounting standards (the Generally Accepted Accounting Principles, GAAP, or the less rigorous and more fuzzily worded International Accounting Standards, IAS). Otherwise, they conform to local accounting standards, which often leave a lot to be desired. Still, you should look for banks, which make their updated financial reports available to you. The best choice would be a bank that is audited by one of the Big Six Western accounting firms and makes its audit reports publicly available. Such audited financial statements should consolidate the financial results of the bank with the financial results of its subsidiaries or associated companies. A lot often hides in those corners of corporate ownership.

Banks are rated by independent agencies. The most famous and most reliable of the lot is Fitch-IBCA. Another one is Thomson BankWatch-BREE. These agencies assign letter and number combinations to the banks, that reflect their stability. Most agencies differentiate the short term from the long term prospects of the banking institution rated. Some of them even study (and rate) issues, such as the legality of the operations of the bank (legal rating). Ostensibly, all a concerned person has to do, therefore, is to step up to the bank manager, muster courage and ask for the bank’s rating. Unfortunately, life is more complicated than rating agencies would like us to believe. They base themselves mostly on the financial results of the bank rated, as a reliable gauge of its financial strength or financial profile. Nothing is further from the truth.

Admittedly, the financial results do contain a few important facts. But one has to look beyond the naked figures to get the real – often much less encouraging – picture.

Consider the thorny issue of exchange rates. Financial statements are calculated (sometimes stated in USD in addition to the local currency) using the exchange rate prevailing on the 31st of December of the fiscal year (to which the statements refer). In a country with a volatile domestic currency this would tend to completely distort the true picture. This is especially true if a big chunk of the activity preceded this arbitrary date. The same applies to financial statements, which were not inflation-adjusted in high inflation countries. The statements will look inflated and even reflect profits where heavy losses were incurred. “Average amounts” accounting (which makes use of average exchange rates throughout the year) is even more misleading. The only way to truly reflect reality is if the bank were to keep two sets of accounts: one in the local currency and one in USD (or in some other currency of reference). Otherwise, fictitious growth in the asset base (due to inflation or currency fluctuations) could result.

Another example: in many countries, changes in regulations can greatly effect the financial statements of a bank. In 1996, in Russia, to take an example, the Bank of Russia changed the algorithm for calculating an important banking ratio (the capital to risk weighted assets ratio). Unless a Russian bank restated its previous financial statements accordingly, a sharp change in profitability appeared from nowhere.

The net assets themselves are always misstated: the figure refers to the situation on 31/12. A 48-hour loan given to a collaborating firm can inflate the asset base on the crucial date. This misrepresentation is only mildly ameliorated by the introduction of an “average assets” calculus. Moreover, some of the assets can be interest earning and performing – others, non-performing. The maturity distribution of the assets is also of prime importance. If most of the bank’s assets can be withdrawn by its clients on a very short notice (on demand) – it can swiftly find itself in trouble with a run on its assets leading to insolvency.

Another oft-used figure is the net income of the bank. It is important to distinguish interest income from non-interest income. In an open, sophisticated credit market, the income from interest differentials should be minimal and reflect the risk plus a reasonable component of income to the bank. But in many countries (Japan, Russia) the government subsidizes banks by lending to them money cheaply (through the Central Bank or through bonds). The banks then proceed to lend the cheap funds at exorbitant rates to their customers, thus reaping enormous interest income. In many countries the income from government securities is tax free, which represents another form of subsidy. A high income from interest is a sign of weakness, not of health, here today, there tomorrow. The preferred indicator should be income from operations (fees, commissions and other charges).

There are a few key ratios to observe. A relevant question is whether the bank is accredited with international banking agencies. The latter issue regulatory capital requirements and other defined ratios. Compliance with these demands is a minimum in the absence of which, the bank should be regarded as positively dangerous.

The return on the bank’s equity (ROE) is the net income divided by its average equity. The return on the bank’s assets (ROA) is its net income divided by its average assets. The (tier 1 or total) capital divided by the bank’s risk weighted assets – a measure of the bank’s capital adequacy. Most banks follow the provisions of the Basel Accord as set by the Basel Committee of Bank Supervision (also known as the G10). This could be misleading because the Accord is ill equipped to deal with risks associated with emerging markets, where default rates of 33% and more are the norm. Finally, there is the common stock to total assets ratio. But ratios are not cure-alls. Inasmuch as the quantities that comprise them can be toyed with – they can be subject to manipulation and distortion. It is true that it is better to have high ratios than low ones. High ratios are indicative of a bank’s underlying strength of reserves and provisions and, thereby, of its ability to expand its business. A strong bank can also participate in various programs, offerings and auctions of the Central Bank or of the Ministry of Finance. The more of the bank’s earnings are retained in the bank and not distributed as profits to its shareholders – the better these ratios and the bank’s resilience to credit risks. Still, these ratios should be taken with more than a grain of salt. Not even the bank’s profit margin (the ratio of net income to total income) or its asset utilization coefficient (the ratio of income to average assets) should be relied upon. They could be the result of hidden subsidies by the government and management misjudgement or understatement of credit risks.

To elaborate on the last two points: a bank can borrow cheap money from the Central Bank (or pay low interest to its depositors and savers) and invest it in secure government bonds, earning a much higher interest income from the bonds’ coupon payments. The end result: a rise in the bank’s income and profitability due to a non-productive, non-lasting arbitrage operation. Otherwise, the bank’s management can understate the amounts of bad loans carried on the bank’s books, thus decreasing the necessary set-asides and increasing profitability. The financial statements of banks largely reflect the management’s appraisal of the business. This is a poor guide to go by.

In the main financial results’ page of a bank’s books, special attention should be paid to provisions for the devaluation of securities and to the unrealized difference in the currency position. This is especially true if the bank is holding a major part of the assets (in the form of financial investments or of loans) and the equity is invested in securities or in foreign exchange denominated instruments. Separately, a bank can be trading for its own position (the Nostro), either as a market maker or as a trader. The profit (or loss) on securities trading has to be discounted because it is conjectural and incidental to the bank’s main activities: deposit taking and loan making.

Most banks deposit some of their assets with other banks. This is normally considered to be a way of spreading the risk. But in highly volatile economies with sickly, underdeveloped financial sectors, all the institutions in the sector are likely to move in tandem (a highly correlated market). Cross deposits among banks only serve to increase the risk of the depositing bank (as the recent affair with Toko Bank in Russia and the banking crisis in South Korea have demonstrated).

Further closer to the bottom line are the bank’s operating expenses: salaries, depreciation, fixed or capital assets (real estate and equipment) and administrative expenses. The rule of thumb is: the higher these expenses, the worse. The great historian Toynbee once said that great civilizations collapse immediately after they bequeath to us the most impressive buildings. This is doubly true with banks. If you see a bank fervently engaged in the construction of palatial branches – stay away from it.

All considered, banks are risk traders. They live off the mismatch between assets and liabilities. To the best of their ability, they try to second guess the markets and reduce such a mismatch by assuming part of the risks and by engaging in proper portfolio management. For this they charge fees and commissions, interest and profits – which constitute their sources of income. If any expertise is attributed to the banking system, it is risk management. Banks are supposed to adequately assess, control and minimize credit risks. They are required to implement credit rating mechanisms (credit analysis), efficient and exclusive information-gathering systems, and to put in place the right lending policies and procedures. Just in case they misread the market risks and these turned into credit risks (which happens only too often), banks are supposed to put aside amounts of money which could realistically offset loans gone sour or non-performing in the future. These are the loan loss reserves and provisions. Loans are supposed to be constantly monitored, reclassified and charges must be made against them as applicable. If you see a bank with zero reclassifications, charge off and recoveries – either the bank is lying through its teeth, or it is not taking the business of banking too seriously, or its management is no less than divine in its prescience. What is important to look at is the rate of provision for loan losses as a percentage of the loans outstanding. Then it should be compared to the percentage of non-performing loans out of the loans outstanding. If the two figures are out of kilter, either someone is pulling your leg – or the management is incompetent or lying to you. The first thing new owners of a bank do is, usually, improve the placed asset quality (a polite way of saying that they get rid of bad, non-performing loans, whether declared as such or not). They do this by classifying the loans. Most central banks in the world have in place regulations for loan classification and if acted upon, these yield rather more reliable results than any management’s “appraisal”, no matter how well intentioned. In some countries in the world, the Central Bank (or the Supervision of the Banks) forces banks to set aside provisions against loans of the highest risk categories, even if they are performing. This, by far, should be the preferable method.

Of the two sides of the balance sheet, the assets side should earn the most attention. Within it, the interest earning assets deserve the greatest dedication of time. What percentage of the loans is commercial and what percentage given to individuals? How many lenders are there (risk diversification is inversely proportional to exposure to single borrowers)? How many of the transactions are with “related parties”? How much is in local currency and how much in foreign currencies (and in which)? A large exposure to foreign currency lending is not necessarily healthy. A sharp, unexpected devaluation could move a lot of the borrowers into non-performance and default and, thus, adversely affect the quality of the asset base. In which financial vehicles and instruments is the bank invested? How risky are they? And so on.

No less important is the maturity structure of the assets. It is an integral part of the liquidity (risk) management of the bank. The crucial question is: what are the cash flows projected from the maturity dates of the different assets and liabilities – and how likely are they to materialize. A rough matching has to exist between the various maturities of the assets and the liabilities. The cash flows generated by the assets of the bank must be used to finance the cash flows resulting from the banks’ liabilities. A distinction has to be made between stable and hot funds (the latter in constant pursuit of higher yields). Liquidity indicators and alerts have to be set in place and calculated a few times daily. Gaps (especially in the short term category) between the bank’s assets and its liabilities are a very worrisome sign.

But the bank’s macroeconomic environment is as important to the determination of its financial health and of its creditworthiness as any ratio or micro-analysis. The state of the financial markets sometimes has a larger bearing on the bank’s soundness than other factors. A fine example is the effect that interest rates or a devaluation have on a bank’s profitability and capitalization. The implied (not to mention the explicit) support of the authorities, of other banks and of investors (domestic as well as international) sets the psychological background to any future developments. This is only too logical. In an unstable financial environment, knock-on effects are more likely. Banks deposit money with other banks on a security basis. Still, the value of securities and collaterals is as good as their liquidity and as the market itself. The very ability to do business (for instance, in the syndicated loan market) is influenced by the larger picture. Falling equity markets herald trading losses and loss of income from trading operations and so on.

Perhaps the single most important factor is the general level of interest rates in the economy. It determines the present value of foreign exchange and local currency denominated government debt. It influences the balance between realized and unrealized losses on longer-term (commercial or other) paper. One of the most important liquidity generation instruments is the repurchase agreement (repo). Banks sell their portfolios of government debt with an obligation to buy it back at a later date. If interest rates shoot up – the losses on these repos can trigger margin calls (demands to immediately pay the losses or else materialize them by buying the securities back). Margin calls are a drain on liquidity. Thus, in an environment of rising interest rates, repos could absorb liquidity from the banks, deflate rather than inflate. The same principle applies to leverage investment vehicles used by the bank to improve the returns of its securities trading operations. High interest rates here can have an even more painful outcome. As liquidity is crunched, the banks are forced to materialize their trading losses. This is bound to put added pressure on the prices of financial assets, trigger more margin calls and squeeze liquidity further. It is a vicious circle of a monstrous momentum once commenced.

But high interest rates, as we mentioned, also strain the asset side of the balance sheet by applying pressure to borrowers. The same goes for a devaluation. Liabilities connected to foreign exchange grow with a devaluation with no (immediate) corresponding increase in local prices to compensate the borrower. Market risk is thus rapidly transformed to credit risk. Borrowers default on their obligations. Loan loss provisions need to be increased, eating into the bank’s liquidity (and profitability) even further. Banks are then tempted to play with their reserve coverage levels in order to increase their reported profits and this, in turn, raises a real concern regarding the adequacy of the levels of loan loss reserves. Only an increase in the equity base can then assuage the (justified) fears of the market but such an increase can come only through foreign investment, in most cases. And foreign investment is usually a last resort, pariah, solution (see Southeast Asia and the Czech Republic for fresh examples in an endless supply of them. Japan and China are, probably, next).

In the past, the thinking was that some of the risk could be ameliorated by hedging in forward markets (=by selling it to willing risk buyers). But a hedge is only as good as the counterparty that provides it and in a market besieged by knock-on insolvencies, the comfort is dubious. In most emerging markets, for instance, there are no natural sellers of foreign exchange (companies prefer to hoard the stuff). So forwards are considered to be a variety of gambling with a default in case of substantial losses a very plausible way out.

Banks depend on lending for their survival. The lending base, in turn, depends on the quality of lending opportunities. In high-risk markets, this depends on the possibility of connected lending and on the quality of the collaterals offered by the borrowers. Whether the borrowers have qualitative collaterals to offer is a direct outcome of the liquidity of the market and on how they use the proceeds of the lending. These two elements are intimately linked with the banking system. Hence the penultimate vicious circle: where no functioning and professional banking system exists – no good borrowers will emerge.

Bank Stress Tests

The Federal Deposit Insurance Corporation (FDIC) just issued its final rules for implementing the stress test requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). The FDIC, as a Federal financial regulatory agency, will now require insured state nonmember banks and insured state-chartered savings associations with total consolidated assets of more than $10 billion to conduct annual stress tests. The agency must still define the test scenarios, establish methodologies for conducting the tests for at least three different sets of conditions, including baseline, adverse, and severely adverse, establish the form and content of the report banks must submit, and require banks to publish a summary of the results of the stress tests.

According to its final rule, the FDIC will use a phased approach to implement the stress tests. Most banks with consolidated assets of $50 billion or more have been involved in stress testing previously, including the 2009 Supervisory Capital Assessment Program (SCAP) and the Board’s Comprehensive Capital Analysis and Review (CCAR) stress tests, and consequently have the framework in place to conduct the new tests. Given the size, complexity and importance of these big banks to the safety of the United States banking system, the FDIC will begin those tests more quickly, requiring them this year using financial data as of September 30, 2012. Because there are some state banks with assets of $50 billion or more that were not subject to SCAP and CCAR and may need more time to implement testing, the FDIC has retained the authority to delay implementation on a case-by-case basis. For those institutions that will begin stress testing this year, the FDIC anticipates releasing testing scenarios in November. Then, results are due to the FDIC and the Board of Governors of the Federal Reserve System in January 2013. For these banks, public disclosure of summary test results will be required in 2013.

For institutions with assets between $10 billion and $50 billion, testing will be delayed until October 2013, to ensure these institutions have sufficient time to implement testing programs. The first public disclosure of summary results for these banks will be in 2015, based on 2014 stress tests.

Going forward, the FDIC intends to distribute test scenarios no later than November 15 each year, approximately seven weeks prior to the January date required for $50 billion asset banks to report annual stress test results. For banks meeting the $10 billion to $50 billion asset threshold, the final rule extends the reporting date to March 31 of each year and permits these institutions to report test results under the same timeframe as their parent holding company.

Naturally, banks are concerned about the economic scenarios that will be established by the FDIC for testing. Some institutions suggested testing criteria be tailored to a bank’s specific business profile, including unique asset mixes and operating profiles to avoid distortions. Banks with small geographic footprints wanted to develop economic scenarios relevant to their regional operations. But the FDIC plans to issue the same set of test scenarios to the banks so results can be easily compared. However, the FDIC may require a bank to use different or additional test scenarios if there are unforeseen circumstances to be considered.

When it comes to reporting, the FDIC expects larger banks will have more complex portfolios requiring greater detail, while more simplified reporting should be sufficient for smaller institutions. Again, the FDIC reserves the right to require more or less reporting from each institution or group on a case-by-case basis.

As required by Dodd-Frank, the FDIC is coordinating the rules, test scenarios, reporting and disclosure with the Federal Reserve Board, the Office of the Comptroller of the Currency (OCC), and the Federal Insurance Office to minimize the regulatory burden for banks and ensure consistency between the Federal regulatory agencies.

The FDIC stress tests are intended to assist regulators in assessing a bank’s capital adequacy and to aid in identifying downside risks and potential impact of adverse conditions. The tests are expected to support ongoing improvement in a bank’s internal assessment of capital adequacy and planning. But, the FDIC doesn’t expect banks to rely solely on these required stress tests. They want banks to independently apply broader testing to address a range of potentially adverse outcomes across risk types that may affect a bank’s financial condition, including capital adequacy, capital planning, governance over those processes, regulatory capital measures, results of supervisory stress test and market assessments.

Congress created the Federal Deposit Insurance Corporation in 1933 to restore public confidence in the nation’s banking system. The FDIC insures deposits at the nation’s banks and savings associations, and it promotes the financial health of these institutions by identifying, monitoring and addressing their risk exposure. Dodd-Frank tasked the FDIC with fortifying oversight in an attempt to better anticipate and control potential risks. All eyes will be watching as they develop the testing scenarios and begin to respond to bank results.

Clearly, the stress test results will be an important ingredient to assess bank risk and head off potential disaster. But, you needn’t wait for these annual results to keep abreast of your bank – a Weiss Financial Strength Rating let’s you assess your bank’s results on an ongoing basis.