ABA Banking Journal - June 2009 - (Page 16) Community Banking Pass the Aspirin The Headache Keeping Technology Costs Down Tech costs drive noninterest expense up, but nowadays, community banks have to have it to compete. Indeed, tech has sometimes functioned as the equalizer between large and small banks. We recently asked a group of bankers meeting for next month’s technology roundtable what steps their institutions had recently taken to control technology costs. REMEDY 1 Robert Braswell, president and CEO, Carolina Bank, $650 million-assets, Greensboro, N.C. Approximately five years ago, we went in-house with our information technology. At the time that we made the switch, we were paying $85,000-$95,000 for outside consulting services. The very first year, we saved $50,000, by taking IT inside. REMEDY 2 Gregory Patton, president and CEO, Sierra Vista Bank, $80 million-assets, Folsom, Calif. We’re a two-year-old de novo bank. As you might expect, the first year we were in operation, we hired consultants to help with IT. The second year we hired a chief information officer away from a much larger institution. Already, her workload has expanded much beyond what she originally had to do. She has brought a lot of value to her job. And on a monthly basis, she is less expensive than the consultants. REMEDY 3 Ken Burgess, Jr., president and CEO, First National Bank of Midland, $330 million-assets, Midland, Texas. We are in the middle of converting all of our bank’s network servers to virtual servers, to try to reduce the number of servers we have. It enables you to be more efficient with your backshop. [In this sense, the term “virtual server” refers to a single server that runs with independent sections, called “partitions,” that behave as if they resided on separate servers.] REMEDY 4 Bob King, president and CEO, Sterling Bank, $400 millionassets, Mount Laurel, N.J. We’ve gone through a lot of phases with technology over our bank’s ten years. We have pretty much settled on running things in-house. It’s not always the cheapest alternative, but we have come to believe that developing the skills of the business of banking in-house is important to developing our overall business. We try to use technology in every way possible in pursuing that business. REMEDY 5 Thomas N. Pelletier, president and CEO, Northfield Savings Bank, Northfield, Vt. We have gotten into virtualization, to reduce costs, as well. We’re doing this in two stages. The first stage is being completed in 2009, the second will be completed in 2010. We’ve also implemented branch capture. This will increase efficiencies in our offices, and it will also save us more than $100,000 a year in costs. REMEDY 6 Ted Awerkamp, president and CEO, Mercantile Bancorp, Inc., $1.8 billion—six banks doing business in five states— Quincy, Ill. We have an in-house system. Our head of IT is a CPA and that’s helped. We’ve adopted remote capture across the board, and that’s helped. And we’ve got about 20% of our deposit base receiving statements electronically now. REMEDY 7 Steve Goodenow, president, Bank Midwest, $534.7 millionassets, Spirit Lake, Iowa. We’ve adopted e-statements and virtualization as well. [The bank’s website, www.bankmidwest.com, aggressively promotes e-notices and other e-services from the first screen on. Worth a look.] Subscribe at www.ababj.com 16 JUNE 2009/ABA BANKING JOURNAL http://www.sterlingnj.com http://www.mraeresources.com http://www.carolinabank.com https://www.nsbvt.com http://sierravistabank.com http://www.mraeresources.com http://www.mercbanx.com http://www.mraeresources.com https://www.fnbmidland.com/ http://www.bankmidwest.com http://www.bankmidwest.com http://www.ababj.com Table of Contents for the Digital Edition of ABA Banking Journal - June 2009 ABA Bank Journal - June 2009 Contents Editor’s Column Time to Ramp Up Mortgage Lending? ABA Resources ABA Chairman’s Position Shred Your Marketing Beliefs Pass the Aspirin Top Community Bank Performers: How They Did Security First National Bank: A World Apart, in More Ways Than One People’s Bank of Seneca: A good Time to be a Community Bank Home Bank of California: Prospering - Stuffed with CRE Bank of Dade: Tri-State Market and Cost Control Build Success Course Change Coming for Fair-Lending Enforcement 6 Critical Fair-Lending Pressure Points to Review Now Mining for Dollars Compliance Mailbox More Help for Mortgage Modifiers Banker’s Mart To Advertise/Index of Advertisers The Economy ABA Banking Journal - June 2009 ABA Banking Journal - June 2009 - ABA Bank Journal - June 2009 (Page Cover1) ABA Banking Journal - June 2009 - ABA Bank Journal - June 2009 (Page Cover2) ABA Banking Journal - June 2009 - Contents (Page 1) ABA Banking Journal - June 2009 - Editor’s Column (Page 2) ABA Banking Journal - June 2009 - Editor’s Column (Page 3) ABA Banking Journal - June 2009 - Editor’s Column (Page 4) ABA Banking Journal - June 2009 - Time to Ramp Up Mortgage Lending? (Page 5) ABA Banking Journal - June 2009 - Time to Ramp Up Mortgage Lending? (Page 6) ABA Banking Journal - June 2009 - Time to Ramp Up Mortgage Lending? (Page 7) ABA Banking Journal - June 2009 - Time to Ramp Up Mortgage Lending? (Page 8) ABA Banking Journal - June 2009 - ABA Resources (Page 9) ABA Banking Journal - June 2009 - ABA Chairman’s Position (Page 10) ABA Banking Journal - June 2009 - ABA Chairman’s Position (Page 11) ABA Banking Journal - June 2009 - Shred Your Marketing Beliefs (Page 12) ABA Banking Journal - June 2009 - Shred Your Marketing Beliefs (Page 13) ABA Banking Journal - June 2009 - Shred Your Marketing Beliefs (Page 14) ABA Banking Journal - June 2009 - Shred Your Marketing Beliefs (Page 15) ABA Banking Journal - June 2009 - Pass the Aspirin (Page 16) ABA Banking Journal - June 2009 - Pass the Aspirin (Page 17) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 18) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 19) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 20) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 21) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 22) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 23) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 24) ABA Banking Journal - June 2009 - Top Community Bank Performers: How They Did (Page 25) ABA Banking Journal - June 2009 - Security First National Bank: A World Apart, in More Ways Than One (Page 26) ABA Banking Journal - June 2009 - Security First National Bank: A World Apart, in More Ways Than One (Page 27) ABA Banking Journal - June 2009 - People’s Bank of Seneca: A good Time to be a Community Bank (Page 28) ABA Banking Journal - June 2009 - Home Bank of California: Prospering - Stuffed with CRE (Page 29) ABA Banking Journal - June 2009 - Bank of Dade: Tri-State Market and Cost Control Build Success (Page 30) ABA Banking Journal - June 2009 - Bank of Dade: Tri-State Market and Cost Control Build Success (Page 31) ABA Banking Journal - June 2009 - Course Change Coming for Fair-Lending Enforcement (Page 32) ABA Banking Journal - June 2009 - Course Change Coming for Fair-Lending Enforcement (Page 33) ABA Banking Journal - June 2009 - 6 Critical Fair-Lending Pressure Points to Review Now (Page 34) ABA Banking Journal - June 2009 - 6 Critical Fair-Lending Pressure Points to Review Now (Page 35) ABA Banking Journal - June 2009 - Mining for Dollars (Page 36) ABA Banking Journal - June 2009 - Mining for Dollars (Page 37) ABA Banking Journal - June 2009 - Mining for Dollars (Page 38) ABA Banking Journal - June 2009 - Mining for Dollars (Page 39) ABA Banking Journal - June 2009 - Compliance Mailbox (Page 40) ABA Banking Journal - June 2009 - More Help for Mortgage Modifiers (Page 41) ABA Banking Journal - June 2009 - More Help for Mortgage Modifiers (Page 42) ABA Banking Journal - June 2009 - To Advertise/Index of Advertisers (Page 43) ABA Banking Journal - June 2009 - The Economy (Page 44) ABA Banking Journal - June 2009 - The Economy (Page 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