Independent Banker - June 2021 - 23

Next: To promote innovation, embed it in your culture 
management solutions that adhere
to regulatory requirements. They not
only mitigate risks and control costs
but also increase the value of the
relationships between vendors and
community banks, Herman says.
" We have taken the conservative,
yet acceptable approach of
aggressively managing our contracts
from negotiations to strategically
align contract maturities, " she
says. " Coinciding our core banking
platform agreement with our add-ons
allows the potential to not pay out to
switch or change [platforms] upon
maturity [of the contract]. "
Active core-bank relationships
Ruth Christopher, executive vice
president and chief financial officer at
$815 million-asset Citizens Bank of
Las Cruces in Las Cruces, N.M., says
the bank has been happy with its core
provider. " Their products enable us
to meet the needs of our customers, "
she says. " Therefore, we have felt little
need to work around them. We believe
it is important to be actively involved
with our core. "
The community bank actively
participates in the provider's
conferences and, prior to COVID-19,
regional user groups. " Our preferred
method when dealing with service
issues is to work through proper
channels with our core. However,
we do not hesitate to escalate when
A guide to managing your core relationship
The newly updated ICBA Core Processor Resource Guide includes
steps to evaluate your core processor, your business needs and
potential core vendor alternatives. The guide, which is free for
members, also offers insights into negotiating contracts and
resources for banks switching systems. icba.org/coreguide
necessary, " Christopher says. " This is
easy to do, since we have developed
relationships with upper management
at our core. "
While Citizens Bank of Las Cruces
tends to be hands-on with its core
provider, the bank hired a consultant
several years ago when it renegotiated
its core contract.
Working with consultants can
have its benefits, as they are often
knowledgeable about the core
providers and their service level
offering, says Maria Schuld, division
executive for the Americas Banking
Solutions Group at Jacksonville, Fla.based
FIS.
" While they can give you great
insight and perspective due to this
expertise, " she says, " the decisions
made by the bank should be informed
by clear expectations, objectives and
costs to achieve the best outcomes in
these situations. "
QUICK STAT
75%
of community banks say they
will stick with their current core
processor, rather than switch
Source: ICBA 2020 Core Processor Survey
Evaluate your core vendor
Community banks looking to
accomplish strategic goals should see
their core provider not simply as a
vendor but as a partner, Schuld says.
Banks can build their core relationship
by better understanding what
solutions, services and functionality
they already offer and by reviewing
account and support resources. Banks
should make their core providers
aware of their business goals, too.
" Sharing your strategy is an important
step to ensure your core provider
understands your needs and is able to
collaborate with you, " she adds.
As with any relationship, Stacey
Zengel, vice president of Monett,
Mo.-based Jack Henry & Associates
and president of Jack Henry Banking,
says communication between a
community bank and its core provider
is integral to a successful partnership.
He likens it to the importance of
communication between spouses to
maintain a strong relationship.
When evaluating a core
relationship, community banks
should ask themselves if there are
gaps in functionalities and if their
provider honestly discusses how-or
if-it can fill them, Zengel says. Often,
banks mistakenly believe there are
gaps because they aren't leveraging
the functionality that their core
provider already offers. Community
banks should take advantage of
their provider's user groups to
discuss issues and possible solutions
that other banks have employed,
Zengel adds.
" Banks should get to know what the
provider can already do for them, " he
says. " It's important to get educated,
and consulting services with your core
provider are available. " 
Katie Kuehner-Hebert is a writer
in California.
independentbanker.org Q 23
http://www.icba.org/coreguide http://www.independentbanker.org
Independent Banker - June 2021

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