Pandemic: No Problem. And Messages From Our Financial Services Providers

Here is what my family is doing to reduce the risk of contracting or spreading coronavirus:

1. Washing hands with greater discipline for 20 seconds per wash. Which is difficult. I'm singing the "Baby Shark" song.

2. Daily disinfecting of frequently touched surfaces such as phones, keyboards, handles, etc.

3. Coughing and sneezing into our elbows.

4. Trying desperately to not touch our faces. Do you know how hard this is?

5. Following CDC guidelines and state recommendations to reduce risk, such as not attending large gatherings. The NHL made that difficult Flyers-Wild game decision for me. Hoping to get tickets for another game.

6. Towelette wipe down of seating area when I fly.

7. Sign up for my health plan's virtual doctor visit portal. In case we need it.

Here is what we are doing to support local businesses:

1.  Keep going to them.

2.  Order online, as most restaurants will either deliver or prepare for pickup.

3.  Highlight brands that are supporting their hourly employees even in lieu of significantly declining revenues.

4.  Highlight charities and wealthier individuals that are supporting the same, such as Kevin Love of the Cleveland Cavaliers donating $100,000 to support arena workers.

5.  Not sniping at politicians because I disagree with them.

6. Not hoarding.

Here are some messages that I have received from various financial firms regarding coronavirus preparedness. Perhaps your pandemic response team would be interested.

Stay safe out there and don't panic!

Genworth

Dear Valued Policyholder:

As COVID 19 (the coronavirus) dominates the news and the stock markets have large movements from day to day, we at Genworth want to reassure you that our associates are well positioned to continue our long tradition of being there for our policyholders regardless of social and economic conditions.

We have proactively taken steps to make sure that our associates are safe, our call centers staffed, and our processing teams are able to function. We have implemented employee travel restrictions, provided associates with tools and technology and have encouraged them to work from home, conducted a deep cleaning of all Genworth facilities and revised our time off and FMLA policy. These changes provide our associates with the flexibility to adapt their schedules to meet our business obligations and limit any service interruptions.
 
Genworth’s high commitment to serving you includes a robust self-service opportunity MyGenworth available 24/7. To sign up, click: https://www.genworth.com/login.html. With MyGenworth, you can obtain current policy status and perform routine policy updates such as address changes and beneficiary updates. Additionally, we encourage you to consider signing up for Electronic Funds Transfer (EFT) for your on-going premium payments as well as policy benefit payments you receive from us on a routine basis. You will find the necessary authorization information under the “Billing and Payments” section on MyGenworth. 

To help you stay healthy and take care of yourself we are sharing some useful third-party resources.

https://www.nahc.org/resources-services/coronavirus-resources/
 
https://www.cdc.gov/coronavirus/2019-ncov/index.html
 
We realize times like these can be unsettling, rest assured we are ready to serve you and value your business.
 
Sincerely,

David O’Leary
CEO, President, U.S. life insurance division

MassMutual

Market Volatility and Your Workplace Retirement Savings     Recent volatility within U.S. and global markets brought on by global health concerns has been historic and unsettling. You're not alone if you have concerns or questions about your retirement savings and investments during current market conditions.           MassMutual is committed to providing you with the power of perspective to help you navigate through these uncertain times.           Things to consider       •   Keep calm. It's not easy, but keep in mind that after downturns, history has shown that markets have recovered and delivered gains in the long-term.           •   Revisit your goals and stick to your plan. Be sure to review your goals and keep your individual needs, risk tolerance and time horizons in mind before making changes to your investment strategy.           •   Stay informed. For up-to-date economic insights and analysis, see MassMutual's regular market commentary.           During market swings, it can be helpful to remember that a diversified and balanced portfolio may be a good defense for downturns and can help position you for potential market recoveries. We're here to help you – so be sure to check out our resources and tools to learn more. Please consider your goals, needs, risk tolerance, and time horizon before making any investment decisions – and consult with your financial adviser if needed.

© 2020 Massachusetts Mutual Life Insurance Company (MassMutual®), 1295 State Street, Springfield, MA 01111-0001. All rights reserved. www.MassMutual.com.   We hope you found this message useful. However, if you'd rather not receive future marketing emails from MassMutual, please unsubscribe. Replies to this address are not monitored.

BB&T/Truist

You're a valued member of the Truist family, and nothing is more important to us than your health and safety.

As the spread of coronavirus, known as COVID-19, continues to be a growing concern across the country, we’re taking extra precautions to protect you, our teammates and the communities we serve. Our Executive Leadership and business readiness teams are monitoring the situation and are in close contact with health authorities, including the Centers for Disease Control and Prevention (CDC), to ensure we’re acting on the latest guidance and information.

We’re Here To Help

If you're negatively affected by the coronavirus situation, we’re here to help. Our branch bankers, relationship managers and contact center teammates are all committed to working with our clients to reduce financial stress during this challenging and uncertain time.

Contact Information:

BBT.com

Find up-to-date branch hours and other information to manage your accounts

800.BANK.BBT | 800-226-5228

Account information is available through our automated phone system 24/7.

As we assist clients and businesses who may be affected by the coronavirus situation, we're also listening and learning from those conversations to help us evaluate and possibly implement additional client relief measures as they emerge.

We invite you to use our convenient digital banking channels and phone banking options to conduct your banking transactions, and when in doubt, always feel free to contact your relationship manager or local branch.

What Our Company Is Doing To Help

• Increasing our focus on disinfecting surfaces including ATMs, teller line areas, elevator touchpads, door handles and other high-touch areas • Increasing the number of hand sanitizing stations available in our branches and offices • Asking teammates who are sick to stay home until they are well • Asking teammates who have recently returned from any high-risk country on the CDC’s Coronavirus Disease Travel Information website, or who live with someone who has recently traveled to one of those identified regions, to self-report to their manager and work from home for at least 14 days • Suspending international air business travel and limiting nonessential domestic business air travel for our teammates • Conducting group meetings by phone or other digital means

Keeping You Informed

We’re committed to keeping you informed through this rapidly changing situation. As it evolves, you can always find the latest information here on Truist.com. Please do not hesitate to contact us if we can be of assistance with any of your banking needs.

For the latest information about COVID-19, please visit cdc.gov or your local health department website.

Navy Federal Credit Union

An Update for Our Members

The spread of the Coronavirus (COVID-19) has all of our attention. I wanted to let you know your Navy Federal Credit Union family is doing everything possible to keep our employees and you, our members, safe while delivering the best member experience possible. What We’re Doing We’re monitoring and following all guidance from the Centers for Disease Control (CDC), including taking the steps necessary to reduce the threat of COVID-19 exposure to employees and members. Our branches remain open to serve you. We have an extensive cleaning procedure in place and can conduct additional cleanings if needed. Some locations have had their hours adjusted as a result of local conditions. For the latest updates on branch hours, you can visit our Branch Closures & Updates page on our website. Our team members are also being reminded to ensure their hands are regularly washed or sanitized. Steps You Can Take Our commitment to world-class, 24/7 member service remains fundamental to our mission. Our digital banking tools are designed to be easy to use. Whether you’re paying a bill through the Navy Federal website, depositing a check, checking an account balance or transferring money using our mobile app, our goal remains empowering you to conduct your business quickly and easily. If you need to access cash, we have more than 700 Navy Federal ATMs around the world, and you have free access to another 30,000 ATMs in the CO-OP Network®. You can find your nearest ATM here. Our Mission Despite the threat posed by COVID-19, your Navy Federal team remains committed to serving you and your families. You are our members, part of our family, and together we will get through this situation. Sincerely, Mary McDuffie President/CEO Navy Federal Credit Union

Radius Bank

A message from Radius Bank on COVID19  

Like you, the team at Radius Bank is monitoring the latest news about the Coronavirus. As a valued client, we understand your concerns and the uncertainty you may be feeling at a time like this.

We wanted to remind you that Radius is a leading-edge digital bank prepared to handle situations such as this, and as a Radius client, you can handle all your banking needs at anytime, anywhere from your computer or mobile device. Our convenient digital tools give you 24/7 access to your accounts.

Once signed in, you'll be able to:

• View transactions and check balances
• Make payments
• Make a mobile deposit (from the mobile app only)
• Transfer funds
• Update your contact information
• See your account and routing number
• Find an ATM
• Send us a secure message

Make sure you have the correct website address bookmarked and the most updated version of our mobile app by following the links below:

Personal Account Clients

• Enroll in Personal Online Banking
• Download the Radius Mobile app

Business Account Clients

• Contact us to enroll in Business Online Banking
• Download the Radius Business app

We're Here to Help!

Questions?

• Visit our FAQ page
• Start a live chat on our website
• Give us a call at 1.800.242.0272 – you can activate your debit card or reset your PIN, check your balances, hear recent transaction history, and transfer funds all from our automated system, as well as speak with a representative
• For our business/commercial banking and lending customers, you may also contact your portfolio or relationship manager

As always, the health and well-being of our customers and team members is our top priority. We will continue to monitor this situation and will be available to assist our clients as needed.

Please visit radiusbank.com/readiness as the situation evolves for the latest updates.

For additional information about COVID-19, visit the Centers for Disease Control and Prevention at CDC.GOV.

Bank Board Reports: War and Peace or Cliff Notes?

Today, Board reports closely resemble War and Peace. Why? The same reason regulators focus on the little things... to CYA! We don't want to be criticized that our Board was uninformed, so that little embarrassment about the audit exception that turned into employee fraud is on page 262 of your Board report. 

You mean you didn't see it? That's on you, fella.

Are we trying to fool ourselves into believing that all of our Board members are reading the 300+ pages we send to them two days prior to the Board meeting every month? Sure, there will be some that do. But my suspicion is there are more that do not. How could they? It's 300 pages! In two days! And most Board members have full time jobs!

According to the FDIC pocket guide for directors, a financial institution's Board should:

- Select and retain competent management

- Establish, with management, the institution's long and short-term business objectives in a legal and sound manner

- Monitor operations to ensure that they are controlled adequately and are in compliance with law and policies

- Oversee the institutions' business performance

- Ensure that the institution helps to meet its community's credit needs

How many pages per month do we need to fulfill Board responsibilities? What is not in the above list are the following things that I often see Boards debating:

- Selecting contractors for the buildout of the new branch

- Determining raises for employees that are not Senior Management

- Credit underwriting

- Small ticket charitable donations

- Loan administration's $100 budget variance

All of these distractions take valuable time away from Boards doing what they should be doing, described above. Here is what I suggest for Board reporting:

1. Financial reports for the current period, and trends. 

2. Budget variance reports

3. Financial progress towards strategic plan

4. Financial condition and performance versus peer

5. High level risk management reports (because more granular risk reports are reviewed in Committee) and trends.

6. Compliance and audit reports, not included in 5 above

7. Other business such as approving policy changes, large/exception credits requiring Board approval as per policy.

Aside from including a whole policy (changes are blacklined so Board member doesn't have to search for them), or a credit package, I can't see why a Board package has to be more than 100 pages.

Executive recruiter Alan Kaplan recently wrote an article for Bank Director magazine titled What Makes Great Boards Great. His number one characteristic was quality dialog, debate, and discussion. With Board packages that are 300+ pages and agenda's crammed with unfocused topics not directly related to Board responsibilities, how can there be quality dialog, debate, and discussion?

Especially since most directors don't have the time to read 300 pages for their upcoming Board meeting. So they sit in silence when they should be focusing on debate emanating from what is on page 262.

Do you think Board packages focus on the right things?

~ Jeff

·         

Enterprise-wide Risk Management (ERM): Yawn

I attended an industry presentation on ERM this past week put on by RSM McGladrey.  The topic highly interested me, not because it is interesting, but because everybody is talking about it and there are differing opinions about what to do about it. What an opportunity for a non-audit, non-compliance, non-IT, and non-credit blogger to write about it!

First I would like to say that the McGladrey speaker really knew his stuff and was balanced. So often I hear commentary on ERM by advocates that think it is the next best thing to, say, online banking. Well, no it isn't. It is not likely to make your FI a lick of money. That said, here is my criteria for an ERM program:

"A successful ERM will result in reduced losses that exceed the investment made in the ERM program."

~ jeff for banks

Why else would an FI embark on ERM? If the investment in ERM exceeds losses foregone, then don't invest in an ERM program. It's not worth the money. As community FIs, regulators force us to throw enough money down a black hole without us volunteering to do so.

But managing risk across organizational silos is highly fragmented in FIs. It makes sense to coordinate the effort into one area. Perhaps, as suggested by one attendee at the presentation, ERM could streamline risk management efforts to make reporting more relevant, less voluminous, and less labor intensive. If this was a by-product of ERM, then I'm in! I think your Board of Directors (Trustees for CUs) would appreciate reducing the size of monthly Board reports for monitoring risk.

An organization's risk profile looks like the bubble chart below from McGladrey's presentation. But not all risks are equal. If we were to quantify risk across the industry, Credit Risk would rank at 10 for greatest risk (on a hypothetical scale of 1 to 10), but other significant risks would be much lower such as Liquidity and Interest Rate Risk (perhaps 4's). How would a non-audit, non-compliance, non-credit person develop a ranking system for risks?

Look at past experience to determine levels of risk. For example, perform a lookback over a meaningful sample period (perhaps 10 years, or at least one economic cycle) to identify where your FI actually lost money. A second criteria could be to query your personnel with the greatest knowledge of the risk to quantify the possible loss and the likely loss from a certain risk. By developing such a discipline, the FI should determine how much resources, if any, should be dedicated to mitigating the risk.

The bubble chart above contains too much in the form of risk categories, as most categories have sub-risks. The McGladrey presenter mentioned having 20-25 risks worth monitoring and mitigating, although he was not married to it. As ERM evolves, we have to guard against monitoring so many risks that the processes that result are inefficient in their application and ineffective at preventing those risks that represent the greatest potential loss.

For example, I was evaluating processes in a client's deposit operations function where one of the ladies in the department sorted through a large stack of checks for two hours each day. I asked why she did it. She said the Bank had a check fraud about seven years ago, and therefore she had to manually review all checks over $5,000. I asked what a fraud might look like. She didn't seem clear. I asked how many she has prevented since the undertaking. She said none.

Here was an FI that allocates two employee hours per day to prevent a fraud that she probably would not prevent. The investment in resources significantly outsized the risk. I put to you that this example will be all too familiar if we implement ERM without evaluating the size and likelihood of risk. And processes, like government programs, last forever.

This past economic cycle made clear that the single greatest risk FIs face is credit risk. I don't see this changing. Even FIs that failed due to liquidity had their woes start with credit risk, including the credit risk in the FIs investment portfolio. So let's not fool ourselves into thinking that somehow "employee fraud", or some other risk, ranks nearly as high.

But there are risks that can have materially negative impacts on our business. So a CEO and Board can efficiently and effectively monitor the greatest risks to the safety and soundness of the FI, consider implementing a well thought out ERM that is focused, efficient, and effective.

Any thoughts on what such an ERM program would look like?

~ Jeff