Slideshow 'Why Would Anyone Want to Be a Banker': Comments of the Week

  • November 07 2014, 7:30am EST
9 Images Total

American Banker readers share their views on the most pressing banking topics of the week. Comments are excerpted from reader response sections of articles and from our social media platforms.

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On a prediction that more regional banks will plan mergers that make them systemically important financial institutions, to benefit from the implicit government subsidy:

"Today, with all the new regulations and Federal Reserve Board discretion to intervene into a bank's operating decisions, not to mention risks from [Department of Justice] and [Consumer Financial Protection Bureau] litigation that is mostly politically motivated, it is hard to understand why anyone would want to be a banker, let alone a SIFI."

Related Article: Banks' New Merger Strategy: Becoming TBTF

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On whether regional banks would really be enthusiastic about becoming SIFIs:

"I do hear of banks approaching the $50 billion threshold considering bold leaps across it, but not because they are eager to get there, but rather to be sure that there is enough business to be able to support the added burden. Obtaining SIFI-dom reminds me of the words of the poor convict on the way to the gallows, 'If it weren't for the honor of it all, I would just as soon pass.'"

Related Article: Banks' New Merger Strategy: Becoming TBTF

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On a Boston bank that built a high-tech miniature branch on a community college campus to attract passersby:

"By the way, the 350-square-foot branch in a heavily trafficked area, with small teams of 'universal bankers' manning them, has been around for about 30 years now. They're called in-store branches."

Related Article: Makeovers Turn Out Smaller, Sleeker, Smarter Branches

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On a proposal that regulators update the Community Reinvestment Act by designating separate responsibilities and examination standards for online banks with little or no branch presence:

"All well and good, but it would be much better if the folks at the FDIC, Federal Reserve, et al, would actually join the 21st century and realize that by modernizing the regulations, they might actually entice banks and non-banks alike to participate in banking in locations that today, most banks fear to tread. For example, if the regulations would give credence to today's video teller machines, which can perform 80% of most branch transactions, and recognize them as true branch locations, thus allowing CRA credit, I would venture that many banks would put them in all kinds of communities and markets, due to the low cost of investment."

Related Article: How to Move the CRA into the 21st Century

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On reports that banks' merchant-funded rewards programs have been less profitable than expected:

"It's the wrong program. Content consumption is the top predictor of purchase intent. Banks should be in the mobile phone business. Give your best customers a mobile phone and plan and know what they're buying."

Related Article: Targeted Consumer Rewards Fail to Yield Profits for Banks

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On the industry's push to make banks the sole custodians of account credentials when customers use personal finance management sites like Mint:

"The core issue is that the data contained in my bank account is just that: my data. So there needs to be a way for me to safely access that, and if I wish, to share that information with aggregators or other app providers that handle that data in a way that is more personalized and relevant for me than my bank does. This is not the bank's data — it's mine and I have the right to use it."

Related Article: The Search for a Safer Way to Share Consumer Data with PFM Sites

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On a suggestion that merging Fannie Mae and Freddie Mac would be an effective way to trim costs while awaiting reform of the government-sponsored enterprises:

"While we're consolidating, how about looking at HUD/FHA, USDA Rural Development and VA. Why are there three different federal home loan programs, each with different underwriting guidelines and systems, staff, etc.? Seems like if it's necessary to have a federal housing program, that it could be under one umbrella with different niche programs to serve rural areas, veterans, etc. Even if we can't do that, can we at least give them all the same credit standards? The logic of a given factor being good enough for one federal program but not another escapes me."

Related Article: Fannie and Freddie: Two Where One Will Do

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On the argument that forcing front-line bank staff to make heavy-handed sales pitches often alienates both employees and customers:

"It is a mystery to me that the senior level managers don't understand the correlation between satisfied employees and better sales results. Instead, we seem to use the same stale sales tactics that often resemble telemarketing tricks. The more reliable approach is to take care of the customers, become a trusted partner with them and they will then respond by being open to using more products and services."

Related Article: Want More Cross-Sales? You'll Have to Earn Them

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