Cost control continues to be the most important concern of bank operations officers, according to a survey by the American Bankers Association.

In the survey at the ABA National Operations and Automation Conference in May, 54% of 145 banks responding listed cost control as their greatest challenge for the coming year.

By contrast, only 15% of the respondents viewed adapting bank operations to a merger or acquisition as their biggest hurdle.

Consolidation Savings

Over half in the survey had recently merged with another institution, and 79% of that group said they realized cost savings from combining and consolidating operations.

Layoffs were not expected to be as prevalent as last year: 77% said their operations staff would shrink or maintain its present size, compared with 82% who planned staff cuts a year ago.

Outsourcing, or hiring a service company to handle computer and other operations, will also be a major factor in cost-cutting efforts, the survey found. Data processing is the most likely area to be outsourced, followed closely by automated teller machine services.

While cost cutting will curtail some activities, others will expand in the next year. About six of 10 respondents planned upgrades to their platform systems. The number expanding home banking programs rose to 36% from 12%, and those expanding point-of-sale debit programs rose to 36% from 20%.

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