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 http://www.nxtbook.com/naylor/BAKS/BAKS0515 http://www.nxtbook.com/naylor/BAKS/BAKS0415 http://www.nxtbook.com/naylor/BAKS/BAKS0315 http://www.nxtbook.com/naylor/BAKS2/BAKS1014 http://www.nxtbook.com/naylor/BAKS2/BAKS0914 http://www.nxtbook.com/naylor/BAKS2/BAKS0814 http://www.nxtbook.com/naylor/BAKS2/BAKS0714 http://www.nxtbook.com/naylor/BAKS2/BAKS0614 http://www.nxtbook.com/naylor/BAKS2/BAKS0514 http://www.nxtbook.com/naylor/BAKS2/BAKS0414 http://www.nxtbook.com/naylor/BAKS2/BAKS0314 http://www.nxtbook.com/naylor/BAKS2/BAKS0214 http://www.nxtbook.com/naylor/BAKS2/BAKS0114 http://www.nxtbook.com/naylor/BAKS2/BAKS1213 http://www.nxtbook.com/naylor/BAKS2/BAKS1113 http://www.nxtbook.com/naylor/BAKS2/BAKS1013 http://www.nxtbook.com/naylor/BAKS2/BAKS0913 http://www.nxtbook.com/naylor/BAKS2/BAKS0813 http://www.nxtbook.com/naylor/BAKS2/BAKS0713 http://www.nxtbook.com/naylor/BAKS2/BAKS0613 http://www.nxtbook.com/naylor/BAKS2/BAKS0513 http://www.nxtbook.com/naylor/BAKS2/BAKS0413 http://www.nxtbook.com/naylor/BAKS2/BAKS0313 http://www.nxtbook.com/naylor/BAKS2/BAKS0213 http://www.nxtbook.com/naylor/BAKS2/BAKS0113 http://www.nxtbook.com/naylor/BAKS2/BAKS1212 http://www.nxtbook.com/naylor/BAKS2/BAKS1112 http://www.nxtbook.com/naylor/BAKS2/BAKS1012 http://www.nxtbook.com/naylor/BAKS2/BAKS0912 http://www.nxtbook.com/naylor/BAKS2/BAKS0812 http://www.nxtbook.com/naylor/BAKS2/BAKS0712 http://www.nxtbook.com/naylor/BAKS2/BAKS0612 http://www.nxtbook.com/naylor/BAKS2/BAKS0512 http://www.nxtbook.com/naylor/BAKS2/BAKS0412 http://www.nxtbook.com/naylor/BAKS2/BAKS0312 http://www.nxtbook.com/naylor/BAKS2/BAKS0212 http://www.nxtbook.com/naylor/BAKS2/BAKS0112 http://www.nxtbook.com/naylor/BAKS2/BAKS1211 http://www.nxtbook.com/naylor/BAKS2/BAKS1111 http://www.nxtbook.com/naylor/BAKS2/BAKS1011 http://www.nxtbook.com/naylor/BAKS2/BAKS0911 http://www.nxtbook.com/naylor/BAKS2/BAKS0811 http://www.nxtbook.com/naylor/BAKS2/BAKS0711 http://www.nxtbook.com/naylor/BAKS2/BAKS0611 http://www.nxtbook.com/naylor/BAKS2/BAKS0511 http://www.nxtbook.com/naylor/BAKS2/BAKS0411 http://www.nxtbook.com/naylor/BAKS2/BAKS0311 http://www.nxtbook.com/naylor/BAKS2/BAKS0211 http://www.nxtbook.com/naylor/BAKS2/BAKS0111 http://www.nxtbook.com/naylor/BAKS2/BAKS1210 http://www.nxtbook.com/naylor/BAKS2/BAKS1110 http://www.nxtbook.com/naylor/BAKS2/BAKS1010 http://www.nxtbook.com/naylor/BAKS2/BAKS0910 http://www.nxtbook.com/naylor/BAKS2/BAKS0810 http://www.nxtbook.com/nxtbooks/sb/ababj0710 http://www.nxtbook.com/nxtbooks/sb/ababj0610 http://www.nxtbook.com/nxtbooks/sb/ababj0510 http://www.nxtbook.com/nxtbooks/sb/ababj0410 http://www.nxtbook.com/nxtbooks/sb/ababj0310 http://www.nxtbook.com/nxtbooks/sb/ababj0210 http://www.nxtbook.com/nxtbooks/sb/ababj0110 http://www.nxtbook.com/nxtbooks/sb/ababj1209 http://www.nxtbook.com/nxtbooks/sb/ababj1109 http://www.nxtbook.com/nxtbooks/sb/ababj1009 http://www.nxtbook.com/nxtbooks/sb/ababj0909 http://www.nxtbook.com/nxtbooks/sb/ababj0809 http://www.nxtbook.com/nxtbooks/sb/ababj0709 http://www.nxtbook.com/nxtbooks/sb/ababj0609 http://www.nxtbook.com/nxtbooks/sb/ababj0509 http://www.nxtbook.com/nxtbooks/sb/ababj0409 http://www.nxtbook.com/nxtbooks/sb/ababj0309 http://www.nxtbook.com/nxtbooks/sb/ababj0209 http://www.nxtbook.com/nxtbooks/sb/ababj0109 http://www.nxtbook.com/nxtbooks/sb/ababj1208 http://www.nxtbook.com/nxtbooks/sb/ababj1108 http://www.nxtbook.com/nxtbooks/sb/ababj1008 http://www.nxtbook.com/nxtbooks/sb/ababj0908 http://www.nxtbook.com/nxtbooks/sb/ababj0808 http://www.nxtbook.com/nxtbooks/sb/ababj0708 http://www.nxtbook.com/nxtbooks/sb/ababj0608 http://www.nxtbook.com/nxtbooks/sb/ababj0508 http://www.nxtbook.com/nxtbooks/sb/ababj0408 http://www.nxtbook.com/nxtbooks/sb/ababj0308 http://www.nxtbook.com/nxtbooks/sb/ababj0208 http://www.nxtbook.com/nxtbooks/sb/ababj-compsurv08 http://www.nxtbook.com/nxtbooks/sb/ababj0108 http://www.nxtbook.com/nxtbooks/sb/ababj1207 http://www.nxtbook.com/nxtbooks/sb/ababj1107 http://www.nxtbook.com/nxtbooks/sb/ababj1007 http://www.nxtbook.com/nxtbooks/sb/ababj0907 http://www.nxtbook.com/nxtbooks/sb/ababj0807 http://www.nxtbook.com/nxtbooks/sb/ababj0707 http://www.nxtbook.com/nxtbooks/sb/ababj0607 http://www.nxtbook.com/nxtbooks/sb/ababj-jackhenry http://www.nxtbook.com/nxtbooks/sb/ababj0507 http://www.nxtbook.com/nxtbooks/sb/ababj0407 http://www.nxtbook.com/nxtbooks/sb/ababj0307 http://www.nxtbook.com/nxtbooks/sb/ababj-compsurv07 http://www.nxtbook.com/nxtbooks/sb/ababj0207 http://www.nxtbook.com/nxtbooks/sb/ababj0107 http://www.nxtbook.com/nxtbooks/sb/ababj1206 http://www.nxtbook.com/nxtbooks/sb/ababjcompsurv2006 http://www.nxtbookMEDIA.com