Continued stagnant loan growth, higher competition for deposits, shrinking margins, and ultimately lower levels of ROA and ROE throughout the banking industry mandate the development of meaningful and cost-effective funding game plans to support growth requirements.
Most institutions are still benefiting as lower-coupon loans cash flow or reprice into a higher-rate environment. That means interest income can rise even without growth. The challenge is that the story is starting to turn on both sides of the balance sheet.
Institutions of all shapes and sizes are implementing proactive balance sheet strategies to reduce potential exposures, not because they are guessing what will happen to rates, but because they are implementing to be ready regardless.
When institutions rely on static assumptions, they risk falling out of synch with how customers actually respond to changing rates, pricing, and market conditions. But by grounding assumptions in observable data, regularly validating them against performance, and incorporating key behavioral drivers, institutions can help ensure their models reflect reality and perform as intended.
AI will do many things better than humans currently do. But the universe of unsolved problems is so vast, and the cost of attacking them is dropping so fast, that the constraint will not be “what is there left to do?” It will be “who has the initiative to go do it?”
The DCG advisory consulting team starts every week with an internal discussion of market trends, regulatory developments, and the real experiences of our bank and credit union clients. Here are the notes from this week’s Monday Morning Meeting.
The DCG advisory consulting team starts every week with an internal discussion of market trends, regulatory developments, and the real experiences of our bank and credit union clients. Here are the notes from this week’s Monday Morning Meeting.
The DCG advisory consulting team starts every week with an internal discussion of market trends, regulatory developments, and the real experiences of our bank and credit union clients. Here are the notes from this week’s Monday Morning Meeting.
Asymmetric loan prepayment risk is a key dynamic that many IRR models fail to capture. Simplistically-modeled prepayment behavior often obscures the full earnings volatility profile.
The DCG advisory consulting team starts every week with an internal discussion of market trends, regulatory developments, and the real experiences of our bank and credit union clients. Here are the notes from this week’s Monday Morning Meeting.
A single source of truth ensures consistency across the loan portfolio and the institution, so leaders and their teams can guide the balance sheet with clarity and confidence.
Capital planning doesn’t have to be complicated to be effective. The goal is a repeatable process that looks beyond the annual budget, considers what could change, and outlines what to do if capital were under pressure.
As institutions plan for 2026, the challenge is how to balance current earnings momentum with disciplined scenarios and a realistic view of potential risks ahead. Here are some key considerations.
There is a massive tug-of-war between trying to lower deposit rates and protecting deposit relationships. Here are four ideas to help find the sweet spot in the struggle and gain an edge in deposit management.
