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MonJa’s Digital Banking and Lending Monthly Roundup – Why Subscribe?

Digital banking and lending are evolving rapidly. Recent fintech-banking partnerships and innovation in technology with the introduction of AI, ML and blockchain herald a new era in lending. Fintech’s are changing the competitive ecosystem, empowering lenders to process loans faster and smarter.  In a world full of noise, understanding how the technologies and developments may impact your financial institution’s credit decisions and credit portfolio is of critical importance, while also you can improve your finance by learning online trading, as there are resources like trade fx that help you with this. With MonJa’s Digital Banking and Lending Monthly Roundup, it’s easy to stay up to date on what’s happening in the space. Get the latest updates, analysis and commentary on digital banking and lending segment!

04/28/22 SBA direct lending will harm local financial institutions’ relationships (CUInsight)

In most cases, the SBA does not act as a direct lender but rather ensures the repayment of loans provided by a credit union or another lender. In regards to that, the CUNA wrote to the House and Senate Small Business Committees stating that the effective approach for a small business entrepreneur while partnering with a provider of key financial services is to establish and maintain a connection with a credit union. The letter also emphasized the importance of credit unions in assisting small businesses.

04/27/22 Aligning cannabis compliance and member service (CUInsight)  

When developing a cannabis banking program, credit unions should consider how they’ll engage their members to gather the information they need in a way that satisfies their legal requirements while also being mindful to the members requirements. While the right technology can facilitate cannabis compliance and operational teams work more efficiently and achieve better results, the right people, who have been trained as specialized cannabis bankers, are also crucial in developing trusting member connections and can be a competitive differentiator. As cannabis becomes legalized in more states and eventually at the federal level, analyzing how compliance and member service may go hand in hand is crucial in maintaining long-term partnerships with CRBs.   

04/27/22 The tech talent war (CUInsight)  

Credit unions, like most industries in this time of great resignation, are embracing digital transformation to compete with banks and fintech, whose technological advancements are making it difficult for credit unions to retain and recruit talent because they are still in the early stages and lack advanced technology and ongoing innovation. To win the war on talent, credit unions must reevaluate their tech talent requirements and develop a hiring strategy to meet those needs. They require tech leaders who are up to date on the rapidly changing industry to ensure that organizations collaborate with the appropriate partners to keep pace with the rapidly evolving financial services industry.

04/27/22 The path to becoming a credit union CEO (CUInsight)

CUCollaborate looked into the LinkedIn profiles of over 2,700 credit union CEOs to discover what does it take to lead a credit union as CEO. While there are many paths to becoming a credit union CEO, one should have technical skills related to banking and lending, as well as skills like staff management and team building. Moreover, to be the CEO of a sizable credit union, a Bachelor’s or Master’s degree is a must, along with an average of 20 years of prior management and executive experience.

04/27/22 As Rates Rise, New Home Sales Fall Again (CU Today) 

Although rising interest rates are hindering the new house sales, construction delays are no less. According to the National Association of Home Builders/Wells Fargo Housing Market Index, builder confidence in the market for new single-family homes declined for the fourth month in a row. New-home sales plummeted 8.6% to 763,000 annualized units in March, after an upward revision of 47,000 units in February. March sales were down 12.6% from the previous year. Unsold houses on the market increased by 15,000 to 407,000, while the non-seasonally adjusted median home price increased by 3.6% to $436,700 in March, reflecting a 33.4 % increase over the previous year’s inventory levels. In March, sales declined in all Census regions, with the South dropping 10.2%, followed by the Midwest (-8.7%), the West (-6%), and the North (-3%). However, owing to inventory shortages in the existing house market, NAFCU anticipates new home sales to trend up moderately through the rest of the year.

04/27/22 CoVantage CU Agrees To Buy LincolnWay Community Bank (CU Today)

CoVantage Credit Union, a highly successful commercial lender and one of just a few credit unions in the country that has served commercial members for the entire period it has been in existence, has agreed to purchase LincolnWay Community Bank, a wholly-owned subsidiary of LWCBancorp, Inc., specializing in commercial development and commercial real estate loans. It will pay $277 million for LincolnWay Community Bank, making it the seventh credit union purchase of a bank in 2022. CoVantage, following this acquisition, will give the size and scale needed to grow by collaborating with LincolnWay Community businesses. Through the partnership with LincolnWay Community, CoVantage will be able to reach a new market with the award-winning products and services that it provides to its 140,000 member-owners. Michael Bell, a pioneer in credit union bank acquisitions, said the sale demonstrates how more banks looking to sell are seeing the advantages of having credit unions as partners.

04/27/22 Leagues, CUNA Call on CFPB for ‘Open and Transparent’ Rulemaking (Credit Union Times)

CUNA and 50 credit union leagues wrote to House and Senate committees, arguing that the CFPB is failing to accomplish its mission of “making consumer financial markets work for consumers” as its decision-makers aren’t listening to the concerns and priorities of credit unions and other financial institutions that are subject to the bureau’s rulemaking. Credit unions have long opposed the CFPB, but the joint letter stated that the CFPB’s poor regulation is jeopardizing the financial system and the consumers it is intended to safeguard. The Leagues and CUNA also emphasized the need for a reinvigorated appeal for Congress to re-examine the bureau’s structure and implement legislation creating a multi-member bipartisan committee. Irrespective of which political party occupies the White House, open and transparent regulation is an essential aspect of the administrative process as it would offer the assurance that consumers and the financial services industry require.

04/27/22 LendingClub earnings beat Q1 expectations (LendItFintech)

LendingClub exceeded analysts’ forecasts with earnings of $.39 per share on revenue of $289.5 million. Revenue increased by 174 percent year over year, exceeding 117 percent growth in originations. The company reported that its membership had surpassed four million, foreshadowing a profitable quarter’s end. From December 31, 2021, to March 31, 2022, total loans outside of Public-Private Partnership (PPP) increased by 23%. In addition, the bank’s deposits, which totaled $4 billion, increased by 27% and 68%, respectively, boosting loan growth. In totality, Lending Club was predicted to earn $0.24-$.26 per share on $262.07 million in revenue. The company believes that it is in a strong position to carry out its strategy and beat the competition while assisting its members in navigating the ever-changing economic landscape.

04/21/22 Goldman’s checking account for the masses nears as bank tests product with U.S. employees (CNBC)

The launch of Goldman Sachs’ long-awaited checking account, initially scheduled for January 2020, has been postponed as the firm works through its product plan. However, the internal testing for the no-fee, interest-bearing account is now open to all 20,000-plus employees in the United States. They will have the opportunity to be among the first to explore the new product, test chosen features, and provide feedback as beta participants. Goldman’s play to handle Americans’ principal transaction hub is one of the major initiatives it has taken to compete directly with retail giants such as Bank of America and Wells Fargo.

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