Power Up Those Parental Leave Policies: American Express is introducing an improved parental leave policy that no longer distinguishes between primary and secondary caregivers. As of Jan. 1 both new mothers and fathers will receive 20 weeks of fully paid leave after their child's birth. Under the outgoing policy, primary caregivers (typically women) received six weeks of paid leave and secondary caregivers (typically men) received two weeks off. Amex is also increasing the benefits in its health plan for those seeking to become parents, allowing up to $35,000 for surrogacy and adoption (previously $10,000) and another $35,000 for infertility treatments (previously capped at $20,000). The goal is to support employee parenting efforts "in a more complete way," according to Kevin Cox, Amex's chief human resources officer. There's also "a diversity dimension at play," because the new policy could appeal to female and LGBTQ workers in particular, he said. Better benefits for parents just might be an emerging trend in the industry. This year Wells Fargo began offering full- and part-time U.S. employees paid parental leave for the first time and Bank of America increased its paid parental leave from 12 weeks to 16 for U.S. employees. (It's worth noting that, as part of our Women in Banking op-ed series this fall, two writers made a case for using better parental leave policies as a means to improve diversity in banking — here and here.)
Banks as Tech Vendors: Some community banks have created a new income stream by marketing tech products they developed internally to other banks. Citizens Bank of Edmond in Oklahoma, for instance, worked with two local technology firms to provide customers with interactive teller ATMs. The $252 million-asset bank now gets royalties from allowing other banks to use that technology. "All bankers are looking at how we can be more efficient and effective and also improve the customer experience," said Jill Castilla, the president and chief executive of Citizens (and one of our Women to Watch). "Those of us that do it internally or through partnerships will have the ability to potentially resell that to other banks."
Don't Demolish Dodd-Frank: Federal Reserve Chair Janet Yellen said she is advising the incoming Trump administration not to roll back improvements in bank safety and soundness that were implemented by the Dodd-Frank Act. Even so, she offered her support for the idea of reducing the regulatory burden on small banks. She also acknowledged that recent scandals suggest there is room for much more improvement when it comes to bank culture. And she defended the existing framework for resolution plans, saying it is progress toward Republicans' stated goal of ending Too Big to Fail. Though she reiterated that she plans to serve out her full term as chair, she left open the possibility that she might leave when her chairmanship expires in 2018, instead of remaining on the Board of Governors until her seat expires in 2024. She also deflected a question about whether she would accept if Trump sought to reappoint her as chair, saying "that is a decision I don't have to make" at the moment.
Social Mission: A startup called Mighty is building a platform to highlight mission-driven banks for prospective customers who want to know how their deposits are being used to benefit the community. Its CEO, Megan Hryndza, believes social impact will become part of banks' competitive advantage, similar to how consumers might choose to give their business to coffee shops that use fair-trade beans or retailers that sell only American-made apparel. Essentially Mighty — which is being tested with just a few banks to start — helps people decide where to put their money based on factors that have nothing to do with the rates paid on deposits, a service that Hryndza expects to appeal to millennials in particular. "When you bank, you are providing fuel to different markets," Hryndza said, adding this outcome is clearer with investments than deposits. "Just like investors, I, as a depositor, am ready to know the markets I'm powering," she added.
Three Years to Get to 35%: U.K. financial services companies are trying to increase the average number of women at senior management levels to 35% by 2020, up from the current average of 27%. There are 71 companies — including Mastercard, HSBC, Morgan Stanley, Barclays, Deutsche and Credit Suisse — signed on to the Treasury's Women in Finance charter. Participants in the initiative have agreed to make one senior executive accountable for diversity, set targets for gender diversity and link senior executive pay to success in reaching diversity goals. "It is important that the next generation of women working in finance have the opportunity to break the glass ceiling and get to the top," said Jayne-Anne Gadhia, CEO of Virgin Money and the government's Women in Finance champion. The average pay gap between men and women is 18.1%, the lowest level since records began, according to the Office for National Statistics.
Be Cautious on Open Banking: U.S. banks are right to monitor "open banking" developments in the U.K. and European Union, even if it's to determine that the flaws in such a system should be worked out before a similar approach is adopted here, said Oonagh McDonald, a consultant who was formerly a member of U.K. Parliament and a director of the Financial Services Authority. "The priority for banks should be on rebuilding trust, and allowing third-party access to foster open banking is likely not the best way forward," she wrote in this op-ed. "Technology could be used to prevent identity theft in an open banking model but only if banks get together to consider how to do that. If done right, the data portability technology could benefit all the banks and their customers in the U.S."
New Best Friend: Banks should embrace artificial intelligence so that they can more easily navigate policy shifts that affect compliance, argues April Rudin, CEO of wealth-marketing firm The Rudin Group. She predicts that AI will become bank compliance officers' best friend, but that's not to say intelligent computers will erase humans' jobs. That "may be the plotline of science fiction movies, but in reality banks will always need flesh-and-blood staff to handle bank compliance and customer service needs," she wrote in this op-ed. "Compliance officers can use AI's cognitive capabilities to highlight the sections that they should read in addition to using AI to pinpoint what divisions will be affected by each aspect of regulation."
Heritage Oaks president and CEO Simone Lagomarsino will join the board of Pacific Premier Bancorp in Irvine, Calif., after its purchase of the $2 billion-asset Heritage closes in the second quarter of 2017. Lagomarsino said selling was the right decision because of the benefits of becoming part of a larger institution, including a bigger lending limit. She also said she is uncertain what role she'll take on next. Lagomarsino was one of American Banker's Community Bankers of the Year in 2013.
In Case You Missed It
Days of Olde: Cape Cod Five Cents Savings Bank's name is a throwback to the days when the first savings banks were created. They had started out as philanthropic enterprises, capitalized by contributions from well-to-do citizens and staffed by volunteers, as this article exploring the history of savings banks details. Despite how much the times — and these institutions — have changed, keeping an old-fashioned name like Cape Cod Five suits its CEO, Dorothy Savarese. "We've maintained the name even though some people think it's an anachronism," she said. "To us, it's a reminder." Savarese also shared some theories about the origin of the name. "Some people allege that it was because it took five cents to open an account," she said. "Another more common theory is that it was to encourage thrift, and that they were encouraging the fishermen and the cranberry farmers here to put five cents a week into their savings."
A Big Job in Louisiana: Janet Olson recently moved from Capital One to Chase to take over as president of its Baton Rouge market. One of her biggest tasks so far has been helping the Baton Rouge area rebound financially from an August flood, through initiatives such as waiving banking fees for 500,000 affected customers and providing assistance on mortgages and car loans for more than 1,800 customers.
Too Sexy for This Job: The United Nations has dropped Wonder Woman as an honorary ambassador for women and girls … because of the way she dresses. At least 44,000 people signed a petition complaining that Wonder Woman is "overtly sexualized" and not "culturally encompassing or sensitive" enough to represent female empowerment. The petition began circulating after the fictional character was named to the U.N. post a few months ago. "The bottom line appears to be that the United Nations was unable to find a real-life woman that would be able to champion the rights of ALL women on the issue of gender equality and the fight for their empowerment," it said.
Rising Rates of Another Kind: Hourly wages for women rose faster than they did for men in November. It is the third consecutive time that happened — the longest such stretch in about six years, according to data from the Federal Reserve Bank of Atlanta. Women's wages rose at a rate of 4.1% on a year-over-year basis in November. That's just a 0.5 percentage point faster than men's rate of wage growth. This is a different measurement than the gap in overall wages, which shows that women earn about 20% less than their male peers.
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