MOUNTAIN VIEW, Calif. A new survey suggests credit unions and community banks are overpaying for technology by not negotiating better with IT providers.
The survey, part of a report called “Less Burn, More Return” from the Business Performance Innovation Network and Paladin fs, suggests smaller financial institutions are paying approximately 24% over “fair market value” for core systems. It said the figure is even higher, 29%, for institutions between $500 million and $1 billion in assets.
Meanwhile, in separate findings from the survey, the top concerns of CU and community bank execs for the next 12 months include tight net interest margins (79%), increased regulation (72%), sluggish economic growth (54%) and greater competition from larger institutions (33%).
The top management priorities identified by those same executives included growing loan portfolios (82%), reducing non-interest expense (63%), managing new regulatory requirements (50%), and adding new technologies and bank processes (34%).
