IBANYS’ associate member firm Promontory Interfinancial Network’s “Bank Confidence Index” has hit a four-year low.Its latest Bank Executive Business Outlook Survey Report details the results of the survey, which is based on bank leaders’ forward-looking expectations for access to capital, loan demand, deposit competition, and funding costs. The report includes overall confidence and component readings by region for the past four years. For bankers, 2018 was a turning point. Bankers noted a number of factors (e.g., weaker growth in loan demand, higher funding costs, more competition for deposit) that underscored a much tougher environment for the industry. Other highlights from the survey include:
- Loan Demand. A major change from a year ago. Last year, 64% of respondents predicted an improvement in loan demand for 2018. This year, just 39% expected to see an improvement in the indicator over the next 12 months.
- Deposit Competition. Expectations for deposit competition remained relatively stable-at high levels-for the past year.
- Funding Costs. At the end of 2018, 88% of respondents expected funding costs to rise, down slightly from recent quarters, but in line with predictions from the beginning of the year.
- Access to Capital. After a drop in the first quarter, expectations regarding access to capital remained steady throughout 2018.
Note: Promontory helps financial institutions of all sizes thrive. Promontory Network members use its solutions ̶ Bank Assetpoint, Insured Cash Sweep, or ICS, CDARS, IND, and Yankee Sweep ̶ to source new asset opportunities, diversify their asset portfolios, reduce collateral requirements, purchase funding, and build multi-million-dollar relationships. Contact Kevin Hamilton firstname.lastname@example.org, (866) 776-6426 ext. 3329 to see how Promontory can help your bank manage its balance sheet more profitably.