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Managing Your Banking Relationship

September 3, 2012
By Michael Fina Vice President, Union Affinity Manager, First Trade Union Bank

On July 21, 2010, President Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act (HR 4173).  The legislation was the largest and most influential financial reform package since the Great Depression.  What’s more, it included several hundred rules and studies to be further evaluated by regulators, insuring many more regulatory changes to come in the financial services industry.

While it will take years to fully understand the impact of this legislation on the banking industry, one thing we know for certain is that it is having substantial impact on the bottom line, as banks wrestle with the costly undertaking of regulatory compliance.

For those with fiduciary responsibilities to your organization, you have probably experienced the increased paperwork and administrative bureaucracy this legislation has ushered in.  It has probably also led to increases in your banking fees and transaction costs.

All of this suggests that periodic reviews of your banking relationship are not only advisable, but necessary.  We recommend all parties have mutually agreed upon reviews with a frequency that makes sense for the level of business activity; quarterly, semi-annually or annually seem to work for most customers.  Use these business reviews as a time to look at pricing trends and to project volumes and costs for the period until the next review.  This information can assist in making better budgeting decisions and allow you to fix your expenses for that time period, if needed.

Meeting with your bank’s account team gives you the opportunity to talk about service issues and explore ideas to make the operation more efficient.  It’s also a great time to talk about product and service enhancements that might be worth incorporating into your business requirements.  Fraud protection services, for example, are being added to most banks’ product portfolios quite frequently.  This is the time to determine if they make sense for your business needs.

The banking industry is undergoing unprecedented change.   Technological advancements allow you to handle the majority of your business and personal banking virtually from a computer, mobile phone and tablet.  Sweeping legislation, while less obvious to us on a daily basis, is impacting every aspect of banking operations and the upcoming elections could mean more changes lie ahead.  Perhaps now, more than ever, you should be paying close attention to your banking relationship, as most likely things have changed a bit since you last looked.

In Solidarity,

Michael Fina
Vice President | First Trade Union Bank

First Trade Union Bank is a union-owned community bank serving labor organizations and its members for more than 25 years.  NY offices are located in New Hyde Park and Hauppauge.  Michael Fina, Vice President / Institutional Banking for First Trade Union Bank, is responsible for generating new relationships with public and private sector unions throughout New York State and can be reached at 516-874-9601 or  mfina@ftub.com . 

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