Saving time and money were primary drivers of community bank IT spending last year, as many of the country's smallest banks got squeezed; not typically from securitization woes, but from the housing market freefall that crippled many retail borrowers and made lots of construction loans go bad.

But even before the financial crisis, the price of staying cost-competitive was weighing on small banks; it's now making them ever-more-attractive acquisition targets as the banking industry morphs into a new era. Celent analysts say consumers will soon expect from community banks the same technology offerings they can get from big banks-mobile banking, consumer and business RDC, branch capture and others. Community banks, especially those with less than $500 million in assets, "lack the infrastructure to run these systems in-house and the buying power to drive the ASP price down," writes Celent's Bart Narter in his report, "It Takes More Than a Village: The Decline of the Community Bank." More....

Celent is onto something. Some 66 percent of respondents to the ICBA's 2008 Community Bank Technology survey list keeping up with emerging technology as one of the long-term IT decisions they face in the next 24 months, 62 percent list improving technology's ROI and 60 percent say keeping technology affordable is on the agenda. (Multiple responses allowed.)

The entries BTN received in its call for the best community bank IT projects all outlined initiatives driven by these concerns. The projects selected for the spotlight ranged across the enterprise, from saving money by reducing server sprawl and implementing redundant backup at The Business Bank in Appleton, WI to cutting $150k from annual training expenses at Bank of American Fork in American Fork, UT. The projects highlighted here are notable not because they rival Wells Fargo or JP Morgan Chase in their technological savvy, but because of the impressive ROI they produced for cash-strapped community banks and their oft-overworked CIOs.

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