It has been quite the year, all the more reason to count our many blessings and be thankful for what we have. We are grateful for our friends, family and those who have impacted our lives. Our thoughts also turn to you with warm appreciation. Thank you for your service and commitment to our Association and for all you do to contribute to our shared success. Have a wonderful thanksgiving holiday with your family and loved ones.

The Staff of the West Virginia Bankers Association
BSA/AML Compliance Strategies in a COVID-19 Environment
Elizabeth K. Madlem, Associate General Counsel

The formal study of risk management has been around since World War II and involves learning how to identify, assess and manage financial risks for an organization. It has long been associated with market insurance, protections from accidents and use of derivatives. It evolved into contingency planning, analyzing various risk prevention activities and portfolio management. Operational and liquidity risks emerged as a formalized concept in the 1990s as financial institutions intensified their market risk and credit risk management activities. Risk management has become a corporate affair-it is a major player in the decisions of an institution's management and monitoring policy. The concept of risk began to cover pure risk management, technological risk management models, and operational risk. And as the identification of new risks emerged, so did an expanded concept of operational risk. Read the full article.
Tactics for Navigating Tectonic Shifts in Liquidity
Scott Hildenbrand, Managing Director
Head of Balance Sheet Analysis and Strategy | Head of Piper Sandler Hedging Services

This year has presented bank management teams with a multitude of issues to juggle, many of which seemingly pull in opposing directions, and most of which were not firmly on the radar to start the year. Such is life in 2020.  Some banks' primary concerns stem from the fact that the industry has seen a shift in liquidity. Balance sheets are awash with deposits relative to recent periods while securities holdings have come down relative to assets. The build in balance sheet liquidity has come in the form of cash, with an unusually high 7.6% of assets held in cash and equivalents as of June 30. 

This drastic change in the liquidity picture is best encapsulated by the significant uptick in the Cash and Unencumbered Securities-to-Assets Ratio. The ratio has surpassed the average over the past fourteen years of 20.6%, steadily climbing toward the high of 24.7% last seen in 1Q13. Read the full article.
Growing Non-Interest Income Without Raising Fees
Dr. Sean Payant, Chief Consulting Officer

Over the last 10 years the banking industry has seen a steady decline in fee income associated with checking accounts-community banks under $10B have seen a 32 percent decline and banks over $10B have seen a 45 percent decline in fee income when compared to a 2008 baseline. Many institutions are raising fees. Should you?

One option: start adding minimum balances in order to get additional income from your current customers. Following the lead of big institutions, some community banks have tried to make up fee income by instituting additional account fees with disappointing results.

In 2010 prior to the implementation of the Dodd-Frank changes related to retail debit cards and overdrafts services, an extremely profitable-midsize bank in the northwest decided to implement a $9 per month service fee on checking accounts. Their fee income dropped dramatically and attrition went up substantially. In a public statement, the CEO ultimately stated the bank had made a mistake; however much of the damage was already done. If monthly service charges aren't the answer, then what is? Read the full article.
Top Six Stress Testing Tips During COVID-19
Dennis Falk, Senior Vice President and Regional Manager
While there are still routine things to look for when stress testing in today's world, there are also some new areas to address. In order to help you with this, today we provide you with our six stress testing tips for COVID-19.
  1. Sensitivity Testing. COVID-19 is an example of the need to do sensitivity testing as well as scenario testing. For instance, can my portfolio withstand an event that is one, two, or three standard deviations (that the far outer edges of normal might be), regardless of where the pressure comes from? Consider sensitivity back-testing to document how specific actions, by your institution and the government, remediated events. Read the full article.
Embracing a Growth Mindset - and New Partnerships - During a Volatile Market
Brian Mullet, SVP, Bank Relationships
Bankers Healthcare Group (WVBankers Associate Member)


PROFESSIONAL DEVELOPMENT
Session 1: Marketing/Business Development/Negotiations
January 28, 2021 | Stonewall Resort 

Presented by Patrice Konarik
February 2 & 3, 2021 | Virtual

(WVBankers Legislative Day)
February 23, 2021 | Charleston Town Center Marriott

February 23, 2021 | Charleston Town Center Marriott