April 16 — In 2018, financial institutions can expect to focus on expanding loan portfolios, with community banks especially keen on generating commercial loans and credit unions working to generate consumer loans. These findings come courtesy of the Cornerstone Advisor’s What’s Going on in Banking report (sponsored by Baker Hill), which states that one in five institutions will add a new or replacement loan origination system this year.
The report also finds that the overwhelming majority (85 percent) of institutions will increase spending on IT this year, with some seeing IT budgets grow by more than 10 percent. Most banks and credit unions surveyed indicated that improving efficiency and service delivery were their most important objectives. Streamlining workflows is also top of mind, with 96 percent of banks and 89 percent of credit unions stating this would help reduce costs.
“In 2018, community banks and credit unions will seek to gain more value from existing systems, as survey respondents listed this as a top priority in the technology department,” said Ron Shevlin, director of research at Cornerstone. “With regards to lending technology, 29 percent of financial institutions want to modify or improve their consumer loan origination system, and 34 percent want to improve their commercial loan origination system. Modifying, improving or if needed, replacing, these systems may help institutions realize the full value of such technology and ultimately, achieve the loan growth that many institutions are prioritizing this year.”
To download the full report, click here.