Tuesday, June 21, 2011

V-blog: Speaking of economies of scale to NY Bankers

I recently spoke at a New York Bankers Association senior management conference regarding the quest for economies of scale to improve earnings through positive operating leverage. I was the leadoff hitter for a tandem that included a JPMorgan Chase banker. I brought my 21 year-old daughter with me, and thought it might be a good idea for her to use our family camera to video and edit my remarks. See below.

Bottom Line:

Banks and thrifts have not reduced efficiency or expense ratios as they have grown... i.e. they have not achieved economies of scale.

I cited three possibilities why this is so:

     1. Culture/Bureaucratic Attitude;
     2. Fragmented Responsibilities; and
     3. Technology Utilization and We Have Always Done It That Way

The session was based on a white paper I recently wrote for the Financial Managers' Society. See link to the white paper below.

This is my first V-blog and I will get better at it, especially if my daughter provides me guidance.

~ Jeff

Lesson learned: We have to get better at camera positioning!

Link to FMS White Paper on economies of scale and positive operating leverage: