Being an "A" Player in a "D" Bank

It's been a couple of weeks since my last post and I figured it is about time to post again. It is pretty much impossible to keep up with the latest news in banking and I have (almost) stopped trying. My thoughts recently have been to focus on who are the real victims in this whole crisis and I have concluded that there are lots of people that are being negatively affected and are paying consequences and it is not just consumers and borrowers. I have really been forced to look through the eyes of the banker whose job is cut due to market circumstances and the current financial crisis. I am not talking about the CEO's and CFO's of Lehman or Wachovia--I am talking about "A" players that have been integral to the growth of the banks that employ them and today have been sent packing. I talk to "A" players daily, and most of these people I consider to be the smartest people that I have the privilege to learn from. Many have been loyal to their banks, maintained a loyal customer following, provided a solid image for the bank through community involvement, and are now left scratching their head because the bank that they have been such an integral part of has now let them know that they are not going to be able to continue to keep them on the payroll through this economic downturn. Some economists would argue that this is just a part of free market enterprise and that everything will balance itself out (some of the same professionals that are now not sure where to start in their job hunt) because that is the way our economy is set up. I can agree to a point and argue that these same bankers that I am now working with to help them find strong opportunities as recently as six months ago pretty much wanted to hang up on me when I called them to let them know about what the competition was looking for. I realize that sometimes you just don't have time to listen to or talk with a recruiter, but now those same bankers are demanding my time in helping them find opportunities. I cannot predict the future and couldn't have known that the banking industry would be one of the industries most negatively affected by this crisis, but I can see that there are many "A" players out there in the market that are or were with "D" level banks and that bank name on their resume can be a huge roadblock to great opportunities. The reputation that these "D" banks carry can make it difficult to even get an interview with a strong bank. I think a lot of the public has also placed blame on bankers at every level and have associated a distrust for loan officers especially. I would urge all "A" players to hold your employer accountable for its reputation and not rely on the fact that you have been loyal to them and made them profitable. It is your career and your reputation as a financial professional to make sure that your personal philosophy and your employers mission statement are consistent. If you find yourself in a "D" organization that doesn't practice safety and soundness, you may want to find an organization that matches your personal philosophy so that you don't become an "A" player stuck in a "D" organization---or worse---no organization at all!

What's in Store for Banking in the Future?

After networking with a few senior banking executives today, one thing that popped into my head was "What is in store for banking in the future?" Banking is a business that is so unique because it is a private business designed to make a profit, yet heavily regulated--and in some cases backed and protected---by the government, so I find myself wondering how banks balance the regulation with the capitalist approach to making profit. I remember writing a paper in middle school about the future and how America will be living in a "cashless society" which I would say is definitely true today. I realize the convenience of using a debit card over writing a check, shopping online in order to just about anything I could want at my fingertips and two days later sitting on my doorstep, and the role it plays in being able to account for where it is that my money is being spent. As with everything else in the world of increasing technology, when we surpass the value of this convenience with the way it can actually do more harm to our financial state, we need to look at the issue and come up with a way to fix the problem. You would think that with all of these technical advances we have to save us time that we would have more time on our hands but it seems that people have less and less of what most of us value more than money. I feel like I am starting to sound like my grandparents, but maybe that isn't such a bad thing--they may be better off in their retirement years than my parents, and possibly myself. I think as an average American we aren't seeing banking for what it really is: a company designed to sell a product or service for a profit. It seems that it is just a part of being an American is to have a bank account, debit and credit cards, loans, and more investment products than we even know how to manage on our own. Just like any other industry or corporation in America, all banks are not created or managed equal. We have a choice in where to put our money for safekeeping, where we want to invest our money for the future, and who we want to pay to lend us money for our homes, cars, etc...How do most people choose what bank to provide them these services? I am not sure what the reasons are but I can say alot of it depends on what is most convenient and time efficient. We don't take the time to shop around for banks or research the financial stability of a company before we deposit all of our hard earned money into the place. We look at what is on paper: Bank A is offering me 5.9% interest on my loan and Bank B is offering 7.2%. Seems like an easy choice right? Well, maybe the looks are decieving. If every American realized the power that we really do have over the success of these private companies, we probably would not have ended up in this financial crisis in the first place. But nonetheless, here we are and we can complain til we are blue in the face but it isn't changing things. So if we can all use our purchasing power to make the best choices on which banks and financial institutions to get OUR business, we could stop letting the ones that operate dysfunctially rake more of our hard earned money. This will create healthy competition for all banks to step up thier lending policies and hold themselves accountable for thier business practices. We need to realize that the average citizen is in the majority and these companies need our money to thrive so we have the control and power and we are not using it! Let's make banks fight for our business by differentiating themselves from the greedy organizations that we refuse to give our money to! Banking is a service to help us gain the things we want, not a necessity to provide for the things we NEED. If we don't empower ourselves as consumers, we are not only hurting ourselves but our children and children's children because we are weakening our economy to the point that we may have no choice but to revert back to the other end of the spectrum and live in a "cash only society" We need to be aware of our power and use it to help ourselves and generations that come after us.