Since the Great Recession of 2008, a number of new laws (e.g. Dodd Frank) and new regulations (e.g. Basel III) were enacted which have had a significant effect not only on how financial institutions conduct business, but also on the costs of compliance associated with these rules & regulations. Unfortunately, these costs have hit smaller institutions such as Community Banks and Credit Unions disproportionately harder than regional and national banks and are also a direct contributor to the rise in consolidation activity amongst institutions. The skyrocketing cost of compliance, in conjunction with increased FDIC deposit insurance fees and shrinking loan spreads due to the low interest rate environment, has caused management of these institutions to look for any type of efficiencies and cost saving opportunities which can be levered in order to bolster earnings.
Besides salaries and benefits, one of the largest non-interest expense items financial institutions incur are for costs associated with the operation of their facilities. Savings vehicles for management to consider range from the full outsourcing of staffing & facilities oversight to having a facility sourcing expert augment its internal staff by handling specific activities which are not directly related to an institution’s core objective of accepting deposits and lending money. At M|GROUP we call the latter “low dollar value/high volume tasks”, the most common examples of which are Lawn/Landscape Maintenance, Snow/Ice Management, Janitorial, and Parking Lot Maintenance & Resealing.
Some of the major benefits of partnering with a facility sourcing expert to manage these types of non-core tasks are:
If a financial institution desires to retain some level of involvement in the management of its real estate facilities while also looking to control costs and increase earnings, partnering with a sourcing provider, such as our M|SOURCE Service Networks division, is an important option to consider.
If you would like more information on how our experts at M|SOURCE Service Networks, Inc. can streamline vendor relationships and create customizable, dependable, and effective service management programs across your branch network, please give Timm Hahn a call at 262-439-4204 or via email at email@example.com