Key Takeaways from the 2019 Raddon CEO Forum
Each year, Raddon brings together many of the industry’s top leaders and visionaries to our invitation-only CEO Forum. This year’s event took place earlier this month in Dana Point, California, with more than 75 executives collaborating for two days of engaging and interactive discussions with their peers. Join us as we reflect back on some of the key takeaways from the 2019 Raddon CEO Forum.
As Raddon’s GM Edward “Skip” Wipson shared with the audience in his opening remarks, the goal of this event and everything that Raddon does is to provide financial institutions with strategic guidance for profitable growth. To that end, the CEO Forum kicked off with a Performance Analytics CEO Roundtable session, allowing executives to compare notes on strategic initiatives and use benchmarking data to tailor strategies that will drive growth to their business. Among some of the more interesting discussions during this session, the group heard from the CEOs of three institutions that each shared insights on their path to high performance. A consistent theme among these three top performers and Raddon Crystal Performance Award winners was the consistent and measured use of data to better understand their performance and identify specific areas of opportunity. Key takeaway: Strong leadership that embraces continuous feedback and measurement leads to organizational growth and improvement.
Continuing with the leadership theme, Fiserv Credit Union Solutions President Vinnie Brennan challenged the leaders in attendance to think about what they would do if they were not afraid, as fear can often paralyze individuals and organizations from achieving their full potential. Drawing from past and current leadership roles, Vinnie shared some of his experiences that had a positive impact on employee engagement. Key takeaway: The importance of open and honest two-way communication is a key to stronger employee engagement and organizational success.
Bestselling author and psychotherapist Amy Morin joined us next to discuss the link between financial health and mental health, and made a strong case for why financial institutions should care. Citing research that concluded the likelihood of having a mental health problem such as anxiety and depression is three times higher among people who have debt, Amy talked about ways in which financial institutions can assist with this national crisis. Key takeaway: Consider working directly with local mental health providers to provide education about debt and mental health.
To continue the conversation after her presentation, Amy joined a panel alongside Community First Credit Union (Neenah, WI) CEO Cathie Tierney and Travis Credit Union (Vacaville, CA) CEO Barry Nelson to discuss some of the ways in which their organizations are addressing these financial health challenges. Cathie shared an inspiring letter from an individual that had rebounded from a dark mental state after being assisted with her financial woes, reminding the audience of the awesome power that financial institutions have in helping to alter someone’s life for the better. Barry shared his credit union’s initiatives to help improve the financial literacy and wellbeing of their own employees, recognizing the impact that this can have on their organization and the communities in which they serve. Key takeaway: Promoting financial health is good for the financial services industry, not only because financially healthy consumers are necessary for sustainable long-term growth, but also because it has a positive impact on our communities and society as a whole.
Next up, former NCUA Chairman Dennis Dollar outlined some of the regulatory and legislative challenges that financial institutions are facing with a divided Congress, and what the industry might expect from the Democrat majority in the House and Republican majority in the Senate. Dennis also highlighted the continuing industry consolidation and merger trends, underscoring the importance of growth as a means to survive and effectively compete. Key takeaway: Strategic mergers for marketplace and economies of scale are being discussed more prevalently.
Former Vice Chairman of the FDIC Thomas Hoenig shared his insights and predictions on interest rates and the economy during his presentation. Thomas’ past experience at the Federal Reserve and FDIC give him a unique perspective on current economic events and trends, and he discussed the probability of rate reductions for the remainder of 2019 and 2020. Mr. Hoenig’s perspective was that changes in the global environment, particularly in regard to trade policy, will require continued low rates in the U.S. However, he did not think we would move into a negative rate environment as we are experiencing in other parts of the world. Key takeaway: The implications will be significant for financial institutions; there is likely to be renewed pressure on margins as loan refinancing may again re-emerge as a significant activity and put downward pressure on loan yields, but at the same time it may be difficult to lower deposit rates.
Raddon VP of Research and Chief Economist Bill Handel presented his view on what the next five years will hold for the industry, using research to help separate the true trends from inconsequential noise. Among his top ten trends for 2025 to watch for, Bill outlined why deeper and more precise marketing analytics will be key to institutional success. Citing brand new Raddon research on the financial behavior of Gen Z finding nearly one-half of consumers between the ages 16 to 19 willing to use a checking account offered by Amazon, a percentage much higher than previous generations, Bill highlighted the rapidly changing market as evidence that innovation is critical for financial institutions to survive and succeed. Key takeaway: Effective management centers on agility and the ability to innovate.
The event concluded with an opportunity to celebrate the successes of some of the top performing financial institutions in the country, as measured by the Raddon Performance Index™, a balanced scorecard of growth, income, efficiency and margin management. This year’s 11th annual Crystal Performance Award dinner recognized credit unions in two asset classes based on their 2018 performance: credit unions above $500 million and below $500 million in assets. To be eligible for the Crystal Performance Award, a credit union must participate in the Raddon Performance Analytics program for an in-depth analysis of the credit union’s financials, sales, products and member household relationships. This year’s winners include a diverse group of institutions that all achieved significant growth and remarkable financial success. Key takeaway: There is no single path to strong performance, but a common thread among these award winning institutions is the ability to consistently execute on their strategy.
That’s a wrap on the 2019 Raddon CEO Forum. But fear not, registration is now open for the third annual Raddon Conference, taking place November 4-6, 2019, at the Chicago Marriott Downtown Magnificent Mile. The Raddon Conference is another opportunity for banks and credit unions to come together to share and discuss ideas on the latest challenges facing financial institutions. We hope to see you there!