How Community Banks Can Maintain Compliance Costs with Today’s Cloud-based software

New banking regulations are driving up the operation costs for banks of all sizes. While it’s easier for big banks to purchase new data tools to remain compliant, small banks and credit unions feel the pinch of making these investments. Many are forced to reduce their offerings just to remain financially viable. There is another option for small banks that need to stay current with regulations and don’t want to overspend: CLOUDecision.

How New Regulations Affect Banks

The Dodd-Frank regulations run to more than 22,000 pages. They mandates banks holding more than $50 billion in assets to develop living wills, evaluated by the FDIC, that outline how the bank’s assets can be dispersed in the event that the financial institution fails.

Under the Comprehensive Capital Analysis and Review requirement, banks must demonstrate capital planning, risk management, and internal auditing capabilities to the Federal Reserve. Banks must show their work in every step of capital planning, and use stress testing models to demonstrate compliance.

As a result of stringent regulations, community banks are getting out of the student loan business, or cutting back on the types of services they offer. To recoup some of the expense, banks may begin charging consumers for certain types of transactions, or increasing consumer fees.

When preparing commercial mortgages, banks and credit unions must invest additional resources in loan screening and use tougher underwriting standards. This means more time- and cost-intensive mortgage pre-approval and underwriting for every commercial client. Banks are also prohibited under the Volker Rule from proprietary commercial trading.

Banks must devote additional resources to cybersecurity measures, which scan the environment for threats, alert security professionals, isolate and mitigate the threat, and safeguard enterprise data. Since the cyber threat environment is constantly changing, this represents an ongoing expense for financial institutions. There is never a point at which banks can stop investing in cyber security.

How CLOUDecision Can Help

CLOUDecision makes it easy for small banks and credit unions to comply with regulations while saving money on software. Regulatory requirements are presented clearly within the software, allowing staff to easily process transactions without spending time checking regulations.

Unlike other software, which is priced at a premium that many small institutions cannot afford, CLOUDecision is a proven alternative for small banks and community credit unions. Designed to be affordable and easy to use, CLOUDecision is a straightforward way for banks to get onboard with regulations while maintaining operations costs. To learn more about CLOUDecision, or see a free live demo, contact us.