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A Strong Loan Review System Is Good for Your Business

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Key Takeaways Effective credit risk review promotes lending agility. Many of the objectives of a credit risk review system support business goals. Keys to effective loan review are independence, sufficient standing in the organization, and adequate funding.

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FinCEN Reissues Real Estate Geographic Targeting Orders

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On November 8, 2019, the Financial Crimes Enforcement Network (FinCEN) reissued their Geographic Targeting Orders (GTOs) for 12 metropolitan areas. GTOs are authorized under the Bank Secrecy Act to detect money laundering and other illicit activity through the purchases of real estate.

The Risk Your Asset/Liability Management Process Might Be Missing

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ALM | 4 minute read Key Takeaways Many financial institutions view asset/liability management as a "check-the-box" regulatory exercise.

How Stress Test Results Can Yield Better Lending, Credit, and Risk Decisions

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Stress Testing | 7 minute read Key Takeaways Stress testing is an important component of sound risk management. Top down and bottom up analysis can inform capital assessments. Stress testing can put a burden on smaller financial institutions, but today's technology "levels the playing field.".

FinCEN Steps up Efforts to Protect Against the Six Biggest Threats to the U.S. Financial System

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The Financial Crimes Enforcement Network (FinCEN) is tasked with protecting the financial system both within the United States and internationally. Financial criminals are working hard, using technology and innovation to their advantage, to stay one step ahead of FinCEN and financial institutions.

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USDA Releases Interim Final Hemp Rules

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3 minute read Key Takeaways The USDA released their interim rule on hemp production. States and tribes must include key components in their programs. States may begin submitting programs to the USDA for approval. .

FinCEN Issues Advisory on the Financial Action Task Force Updated List of Jurisdictions with AML/CFT Deficiencies

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3 minute read Key Takeaways Three countries are added to the FATF list: Iceland, Mongolia, and Zimbabwe. DPRK and Iran continue to need enhanced due diligence. FinCEN released update guidance around these FATF updates. .

Kleptocracy – What Does it Mean to Community Financial Institutions?

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The term kleptocracy has been used in the financial crimes profession for years, but many AML professionals do not understand its meaning and therefore are not adequately monitoring for it within their BSA/AML program. So, what is a kleptocrat?

Effective Loan Pricing – Why It’s Imperative Now More than Ever

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Loan Pricing | 7 minute read Key Takeaways Financial institutions' net interest margins face a nasty squeeze, but a number of factors can contribute to lower yields on loans. Financial institutions have options when net interest margins are squeezed.

October Employment Report: Not So Scary

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Economy | 2 minute read Key Takeaways Overall, October's national employment report was positive. The General Motors strike imp acted the manufacturing sector. Year-to-date, job gains have slowed in comparison to last year.

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CECL Extensions One Step Closer to Final Approval

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CECL | 6 minute read Key Takeaways The FASB affirmed plans to extend deadlines for CECL implementation; a final vote is expected in November. The board will monitor whether it has divided the two adoption-date buckets in the most appropriate way.

Five Ways to Build a Solid Foundation With Your Examiners

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One of the most important business relationships you will have is the one you maintain between your institution and your examination staff. This is not a relationship that only needs attention during the exam process. Instead, this relationship should be nurtured by both sides on an ongoing basis.

Cyber Complications for Vendor Risk Management

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The following article was first published in ABA Banking Journal on October 17, 2019. In a marketplace where data is shared and distributed at record speeds, third-party or vendor risk management is a challenge for most businesses. The banking industry is no stranger to this.

E-Commerce Merchants: A Hot Commodity in the Dark Web

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Dark Web | 5 minute read Key Takeaways Cybercriminals are now targeting e-commerce merchants with malware attacks. Merchants of all sizes are being targeted. Financial institutions should be proactive with their fraud prevention on the dark web. . The New Frontier on the Dark Web.

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Cyber Complications for Vendor Risk Management

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The following article was first published in ABA Banking Journal on October 17, 2019. Cybersecurity | 4 minute read Key Takeaways Third-party/vendor risk management is becoming increasingly challenging with more cloud-based providers.

Creating a Customer-Centric, Digital Financial Institution

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A farmer, a university student, and a business owner walk into a bank. It sounds like the beginning of a joke, but for many community financial institutions, a spectrum of different customers and banking needs is something that they see every day.

On Spreadsheet Day 2019, Celebrate the App, But Acknowledge Its Limitations

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On Spreadsheet Day 2019, Celebrate the App, But Acknowledge Its Limitations. Sub-category | 10 minute read Key Takeaways Spreadsheet Day is a good time to celebrate this popular tool while examining some vulnerabilities spreadsheets pose for FIs.

Avoiding the Suspicious Activity Monitoring Rabbit Hole

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SAMS | 4 minute read Key Takeaways Staff your BSA department for success with more senior employees on alert triage. Document all decisions and clearly state why the activity is (or is not) deemed suspicious. Optimize your transaction monitoring system regularly.

Stress Testing: Are the Results Guiding Your CECL Decision-Making?

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Stress Testing | 6 minute read Key Takeaways Stress testing is a useful tool to help guide CECL decisions. Top-down testing uses pool orientation and segmentation to make decisions. Bottom-up testing is transactional and best for smaller institutions (under $25B).

Another Disappointing Monthly Jobs Report for September

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This morning’s Employment Situation report from the Bureau of Labor Statistics for the month of September came in weaker than expected. There were 136,000 jobs added in September, falling short of the expectation of an added 145,000 jobs.

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Top CECL Questions Answered

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CECL | 7 minute read Key Takeaways Balancing the scales: the FASB's cost-benefit an alysis of CECL. Strategies to lessen the impact of CECL on smaller community banks. How to work better with field examiners and auditors. . The transition to the current expected credit loss (CECL) standard is just around the corner for larger SEC filing institutions, but for many institutions, there are still many questions surrounding the new standard.

Restoring Banking Optimism

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Optimism hit a five-year high in 2017 among c-level executives at financial institutions, but this year, optimism took a sharp dip amidst concerns over decelerated loan growth, an uncertain economy, and higher interest rates, according to survey results by Cornerstone Advisors.

New Community Bank Sentiment Index Shows Bankers Largely Positive

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Community bankers are largely positive about the future, based on the first results of a new index gauging business sentiment among the financial professionals who serve a critical role in local economies.

Examiners’ Shift in Focus Calls for Institutions to Develop a Risk-Based AML Program

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The burden of extensive regulatory exams on a financial institution’s BSA/AML program has taken its toll on the financial crimes industry for years.

Should My Financial Institution Enter into This Interest Rate Swap?

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A rather common method for financial institutions to hedge earnings or value at risk is an interest rate swap transaction. As we move into ever-changing rate environments, eventually you or someone on your ALCO committee may wonder exactly what an interest rate swap would do for the institution.

Can Financial Institutions Bank CBD Retailers? Did the Farm Bill Legalize CBD?

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Leverage New Bank Technology by Examining Current Processes, Pain Points

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Imagine buying a new engine for your car. Your car, however, happens to be 8 years old, with tread-worn tires, and a window that won’t roll up.

Seven Items That Should be on Every BSA Software Checklist

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Shopping for a bank secrecy act/anti-money laundering (BSA/AML) monitoring software can feel overwhelming. There are so many options, features, and benefits to each system that it can be tough to figure out where to start. We’ve spent the last 20 years working with industry experts regarding regulatory compliance and our customer base regarding program efficiencies to build BAM+ into the ultimate BSA/AML regulatory and compliance solution.

August Jobs Report: Hiring Slows, but Wages Increase

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This morning’s BLS Employment Situation Report showed a disappointing 130,000 net jobs created for the month of August. Analysts had anticipated a gain of 150,000 jobs. Moreover, 25,000 of those jobs created were by the Federal Government due to hiring for Census-related activities.

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Lending and Credit Automation: Before and After

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Slow lending decisions and frustrating loan application processes are among borrowers’ biggest gripes with traditional financial institutions vs competitors such as online or alternative lenders.

Loan Grading 101

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In an ideal world, all of the money that banks lend out to borrowers would be paid back at its maturity date. However, that’s not always the case, as there are three inherent risks all financial intermediaries face: credit risk, interest rate risk, and liquidity risk.

FinCEN Releases New Advisory for Financial Institutions Regarding the Fentanyl Epidemic

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In response to the nation-wide opioid crisis that has led to unprecedented addiction and death, FinCEN has issued guidance to alert financial institutions to the financial schemes and typologies related to the trafficking of fentanyl and other synthetic opioids.

How Financial Institutions Focus on Customers Is Key

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The community bank model is built around customer service, but for many bank and credit union customers, the definition of “good service” has been changing over the last couple of decades.

Opacity vs. Transparency at the Federal Reserve Stress Testing Conference

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Last week, the Federal Reserve hosted a stress testing conference in Boston, MA. The conference brought together regulators, bankers, economists, and others to discuss the most important annual check on the stability of the banking system. The initial stress test conducted in 2009 was described as a “wartime” test meant to reassure the public that the system was solvent, and it was very effective.

Latest CECL FAQs

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The Financial Accounting Standards Board’s new current expected credit loss (CECL) standard, known as one of the biggest changes to bank accounting. Because of the complexities and changes that CECL brings, there are many questions surrounding implementation, potential effects, and more.

Easy Ways BSA Officers Can Get Their Required Training

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Ongoing training is at the very heart of a satisfactory Bank Secrecy Act/Anti-Money Laundering (BSA/AML) compliance program in financial institutions.

How One Bank Intends to Implement CECL – And Maybe Even Do It Early

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Main Street Bank, like thousands of other privately held or smaller financial institutions across the U.S., recently found out it will have extra time to implement the current expected credit loss (CECL) accounting standard.

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Is the ThinkBIG Conference Right for My Financial Institution?

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The first annual ThinkBIG Conference is right around the corner.

Helping Bankers Deal with Change: ThinkBIG Keynote Speaker Champions Tips For Change Management

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The current expected credit loss model, or CECL. Modernization of the Community Reinvestment Act. The shifting shape and effect of fintechs on banking. Libra and other forms of digital currency and their impact. Financial institutions are dealing with enormous change these days.

July’s Employment Report Is Just Fine

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The Aug. 2 Bureau of Labor Statistics Employment Situation report for July was about in line with expectations.

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The Importance of Managing Core Deposits 

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“I don’t think there’s any more important topic at this time in our recovery in the economy and the state of community financial institution management,” said Dave Koch, Managing Director of Advisory Services at Abrigo on the topic of core deposits.

Writing Effective Credit Memos Efficiently

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Why is writing effective credit memos so vexing? Given that a credit memorandum is one of the most critical documents in the life of the loan, it would seem like a straightforward process. However, lenders, credit analysts, and other banking staff frequently seek tips for writing better credit memos.

Cybercrime Continues to Top the Leader Board:

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Cybercrime is on the rise within financial institutions and other businesses and continues to be at the forefront of the minds of those in the fraud prevention field. Bad actors are staying one step ahead of detection creating serious hard dollar losses for financial institutions.

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