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The Rise of Artificial Intelligence in Banking

Banks in Wisconsin explore the use of AI

By Hannah Flanders

Just five years ago, the idea that AI, or artificial intelligence, could be incorporated into nearly every aspect of the human experience seemed like a topic for future generations. However, the further we wade into the 2020s, the more each of us comes to encounter aspects of AI in our daily lives, even without realizing it. As the capabilities of AI multiply and the number of individuals utilizing this unique technology expands, professionals in many sectors of the U.S. economy — including the financial services — are considering the ways in which AI impacts their business and the surrounding communities.

What is AI?

Despite what many think, AI is not a new phenomenon. Shortly after the creation of the first digital computer, scientists in the 1950s birthed the concept of AI as they explored the possibility of creating an artificial brain. Today, AI has molded into the creation of technology that has the potential to add efficiencies to our daily lives.

In its current state, AI is a computer system with the capability to sense, think, learn, and take action. Throughout the day, we may encounter AI technology by way of recommendations on our favorite streaming platforms, the anti-virus software that scans our emails for spam, or timed traffic signals. However, the Pew Research Center recently found in its study “Public Awareness of Artificial Intelligence in Everyday Activities” that only around 50% of individuals believed that they interacted with some form of AI more than twice a week.

As technology continues to become more widely available, the development of AI and its integration into day-today life has greatly increased. The New York Times states that in 2022, nearly $1.4 billion was invested into various generative AI companies worldwide. By 2030, PwC expects that AI will contribute over $15 trillion to the global economy by increasing productivity and allowing products and services to be more personalized and readily available.

AI in the Banking Industry

Already, banks around the country have employed AI in various areas of their daily operations. In 2020, McKinsey & Company reported that around 60% of financial institutions had already embedded at least one AI capability into their organization. In utilizing systems that have the potential to conduct research, translate languages, create messages, and write job descriptions — among so many other possibilities — banks are able to quickly detect fraud, streamline specific services, and interact with customers at any time of the day.

However, there are many more possibilities, as noted in a Forbes article “The Future of AI in Banking.” In addition to automating routine tasks, AI is great at tracking patterns, targeting product recommendations, providing more accurate customer support, and serving as a single point of contact for banking operations.

Despite these opportunities, many banks are concerned with the challenges embracing AI may impose. Among the top concerns of Americans, reports the Pew Research Center, are digital privacy and the lack of human connection.

Hello, ChatGPT

In November 2022, ChatGPT was released by OpenAI, a San Francisco-based AI research lab. The chatbot, unlike many others, offers detailed responses in many domains of knowledge. In early 2023, Reuters reported that the chatbot had reached 100 million monthly users.

GPT, which stands for Generative Pre-trained Transformer, is a type of Large Language Model (LLM). The UK’s National Cyber Security Centre describes an LLM as a type of algorithm that has been trained using a significant amount of text-based data, which can typically be found on the open internet. ChatGPT then utilizes “deep learning,” or the process of imitating human learning, to formulate humanlike responses.

The Benefits and Challenges of AI

Because ChatGPT is trained using free, unfiltered data sourced from across the internet, many are skeptical of its reliability and validity. However, it is important for users to acknowledge that many systems are programmed, using the desired or relevant algorithms and data, by humans. As many begin to harness the capabilities of AI, the benefits (and challenges) are becoming evident.

  • Logic and Creativity

Rather than be influenced by emotion, most AI models only have the aptitude to make logical decisions. This capability, which may be beneficial in removing some forms of bias, may not consider the full picture of the data presented. In addition, the lack of emotion may result in less creative solutions.

  • Human Connection

Unlike humans, AI is constantly available. While ensuring customers have around-the-clock access to the organization and its services is key in combating competition, many are concerned that AI may result in less human interaction or replace humans in the workforce.

  • Privacy and Risk

American Banker stated that nearly 80 U.S. financial institutions reported a data breach in 2022. As increasingly more banks look to incorporate AI to analyze large swaths of data, the risk of personal information falling into the wrong hands rises. Because the security measures of ChatGPT, and other models, are determined by the organization or platform hosting the software, businesses should ensure that their risk management practices are up to date and monitored regularly.

  • Implementation/Adaption

Although AI can minimize repetitive and time-consuming tasks, banks should first consider how employing new AI programs may interact with existing software. Additionally, if the adaption process requires extensive effort for both employees and customers, AI may not be the right solution.

  • Regulation

As of this writing, financial regulators have not yet published a comprehensive set of AI-related rules. However, banks are reminded that existing regulation may apply. Several agencies — including the Financial Crimes Enforcement Network (FinCEN) and the Office of the Comptroller of the Currency (OCC) — are encouraging banks to engage with AI to determine its usefulness within their organization.

As more individuals throughout the country become aware of AI, it is important that bankers in Wisconsin closely follow its advancements and challenges as wells as continually explore the ways in which systems, such as ChatGPT, may impact their business, staff members, and customers, While ChatGPT may be just the latest trend, there is no doubt that AI has already left a lasting effect on the power of technology.

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Executive Letter: Staying Ahead of Industry Challenges with the Society of Bank Executives

Rose Oswald PoelsBy Rose Oswald Poels

The Society of Bank Executives — which officially launched earlier this year after a pre-launch session last fall — provides C-suite bankers with accelerated professional development and networking opportunities. As an original partner in the nationwide program, the Wisconsin Bankers Association (WBA) is committed to ensuring bankers in Wisconsin have access to education and resources that allow them to enhance their skills, expand their knowledge, and foster growth and development throughout their bank.

As bankers are well aware, our industry is facing new challenges daily. It is critical, for the continued success of banks throughout the U.S., that all leaders have the ability to identify and proactively respond to various types of risk. As such, the Society has identified Strategic Risk as the topic of the fall 2023 session.

The Society provides its members with a unique opportunity to enhance their own professional development — often alongside members of their executive team — while learning from national experts on the designated topics. In the last year, several Wisconsin bankers have joined the Society and found it to be very valuable to their own professional growth as a leader while meeting peers from around the country.

Membership of the Society includes two six-month, self-paced professional development programs a year. These sessions are focused specifically on assisting bank executives in developing and mastering the “art” of leading a bank. So far, more than 125 bank leaders from 57 banks in 13 states have already joined the Society’s distinctive, peer-driven program.

During the fall event, the Society will host three virtual webinars, with related readings and resources, and one in-person summit. Bankers will hone important leadership skills and be able to network with other leaders from around the country on many strategic topics.

The first Society event for the upcoming fall session will be held via Zoom in August, so now is the perfect time for bank executives in Wisconsin to sign on as individual members or as a team and make the most of the upcoming session. Additionally, new members will gain access to a substantive online library featuring previous sessions and resources related to Trust & Team Building and Culture.

To learn more about the Society, and to join as a member, please visit executives.bank/home.

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Economist to Provide Updates on the U.S. Economy

WBA’s annual Management Conference returns in September

By Hannah Flanders

Dr. Ed Seifried

In September, bank management teams from across Wisconsin will have the opportunity to hear from economist Dr. Ed Seifried during the Wisconsin Bankers Association’s (WBA) annual Management Conference. Having experience teaching students at various banking schools, educating C-suite and bank management staff, and serving as a director for a community bank, Dr. Seifried brings decades of knowledge and experience to this year’s event.

As bankers in Wisconsin find themselves navigating unprecedented challenges relating to inflation, interest rates, and the recent banking crisis, Dr. Seifried will provide attendees with the techniques to monitor the local and global economy, forecast a recession, and prepare resources and responses to assure customers of the stability of the U.S. financial system.

Although Dr. Seifried believes that the current period of inflation is about halfway over, continually monitoring GDP reports will be critical for bankers to ensure that their institution remains able to support growth through loan quality and liquidity. Additionally, utilizing various techniques to monitor the economy will allow bankers to explore appropriate solutions for their bank and remain in the know on current topics impact their communities, according to Dr. Seifried.

Dr. Seifried is one of two keynote speakers presenting during WBA’s annual Management Conference. The event, which kicks off on Wednesday, September 20 with an evening reception, will bring together c-suite bankers and various members of the bank’s management team for networking and education. Register your team now at wisbank.com/management to gain insight from Dr. Seifried and several other speakers during this year’s event.

Register For the 2023 Conference
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Banks Advised to Gear Up Now for 2023 Launch of FedNow Instant Payments

By Paul Gores

Banks interested in joining next year’s rollout of the FedNow faster payments service should be preparing for it today, those familiar with the program say.

FedNow, a Federal Reserve payments service similar to The Clearing House’s RTP network, is scheduled to be offered to banks in the U.S. as soon as May of 2023.

According to the Fed, the FedNow Service will facilitate the nationwide reach of instant payment services by financial institutions, regardless of size or geographic location, and do it around the clock, every day of the year.

Businesses and consumers will be able to send and receive instant payments at any time of day via banks and credit unions that use FedNow. Recipients will have full access to funds immediately, giving them greater flexibility to manage their money and make time-sensitive payments, the Fed says.

“Wisconsin banks have been very innovative over the years, and this is another innovation that’s coming that Wisconsin banks should be looking at and should be adopting when they are ready,” said Todd Koehn, vice president for faster payments solutions at Bankers’ Bank. “It potentially could be a game changer for their customers.”

FedNow currently is conducting a pilot program with more than 100 banks, core processors, and other third-party organizations involved with payments technology.

The U.S. has trailed Europe and some parts of the world in developing an instant payment network. While the privately owned Real Time Payments network, or RTP, is available to American banks, the Fed felt like it needed to play a role to expand the fast-payments realm, experts said.

“All of the market players going back a decade recognized it wasn’t if but when instant payments would come domestically into the market and ecosystem,” said Nick Denning, senior vice president –payments industry relations, for ICBA Bancard. “I think at that time the Fed was trying to determine what role they would play, if any, in instant payments, and ICBA, community banks, and other groups definitely advocated for the Fed to play that operator role to bring more network capabilities to the market.”

Now that the Fed’s faster payment network is getting ready to launch — and will be seeking early adopters — banks that want to participate should be gearing up for it, experts said. To do that, banks should make sure they have an overall payments plan, and begin meeting with their core processor or fintechs that in most cases will be the channel connecting the bank and the new behind-the-scenes FedNow payments “rail.”

“Community banks should be talking to their key technology partners,” said Koehn. “What are their timeframes to get on the rail? How long will it take once they’re on the rail for my bank to join the rail?”

Earlier this year, the Fed disclosed fees for FedNow. But that doesn’t include the cost of the infrastructure needed by a bank to use the network. The overall cost to implement a connection to FedNow is one reason many banks are expected to go through their core processor or a fintech instead of directly to the Fed.

“It’s cheaper to go direct to the Fed, but you’d have to build your own infrastructure and maintain it. And that’s expensive,” Koehn said. “Most community banks will connect through a processor, whether it’s an online banking processor or a core processor.”

According to the Fed, FedNow’s anticipated fees include:

  • A $25 monthly FedNow Service participation fee for each routing transit number (RTN) that enrolls in the service to receive credit transfers.
  • 4.5 cents per credittransfer to be paid by its sender, including returns.
  • A fee of 1 cent for a request for payment (RFP) message to be paid by the requester, including both requests for a new payment or funds to be returned.

A participating financial institution can send an RFP through the FedNow Service to another participating financial institution to request payment of a bill, invoice, or other amount owed by the receiving financial institution’s customer.

The planned FedNow Service’s credit transfer transaction limit will be $500,000.

Brad Northcraft, senior vice president for deposit operations at IncredibleBank, said his bank plans to access FedNow through a payments provider that is part of the financial institution’s core processor.

Northcraft said he thinks a key catalyst for FedNow was for the U.S. to have a system that would bring payments into parity with other countries.

“I think they generally recognized that the payments industry, the velocity of payments, continues to accelerate. I think that was their impetus to really launch FedNow,” he said.

He noted that the introduction of Real Time Payment (RTP) by The Clearing House about five years ago also was a motivation for the Fed to establish its own faster-payments network.

While money moves electronically through ACH, wires and RTP, Koehn said FedNow is meant to augment existing systems, not replace them.

Denning, too, said FedNow will enhance overall payment capabilities.

“To a certain degree, FedNow and RTP network will compete for volume and so forth, but also to a certain degree, complement each other in terms of the robustness of the nation’s payment systems from a resiliency and scope and breadth perspective,” Denning said.

The Fed says surveys show consumers and businesses want faster payments, and that instant payments can help banks better retain their customers.

“Because (with FedNow) I can make a payment on Sunday at 2 a.m. and you’re going to have your payment at 2:01 a.m. — or quicker than that — on Sunday morning, I think it is going to be partially driven by the end user,” Northcraft said.

Koehn said he thinks FedNow is “going to revolutionize community banking because banking has been 5 to 5½ days a week, and FedNow will bring 24-by-7-by-365.”

“And that’s a good thing for community banks when customers are depositing money, and the community bank knows there’s no fraud associated with it,” he said.

Koehn said there are many scenarios in which around-the-clock payments capability could help banks and consumers.

For example, he said, a small manufacturing company might be having trouble attracting and retaining employees because the workers, as is increasingly the case, want to be paid on the same day they do their work, not on traditional paydays every week or two. FedNow could be used to accommodate same-day payroll for the manufacturer.

Or, perhaps, a plumber who made an emergency repair could send an invoice securely over the network, and be paid instantly by the homeowner or business, avoiding the problems of checks that need to be cashed or could bounce.

Banks that don’t have a serious payments strategy need to get going and figure out how FedNow can best help them, those familiar with FedNow say.

“I’ve been in banking for almost four decades. Started in the payments space back in 2011. The mantra back then was whoever controls the payments controls the balances,” Northcraft said.

Denning said banks should be talking to their current third-party providers, whether it’s their core provider or other providers that they leverage for payments or other capabilities, as well as customers.

As part of that process, it’s important to analyze what customers need, Denning said.

“What pain points and challenges do they encounter on a daily basis that I can help solve with some of what we’re doing in payments?” Denning said. “We can offer instant payments, but where the rubber really hits the road is how can we make a difference in people’s lives, how can we help our customers.”

He added: “Connecting those dots on what the providers can do and then what pain points, challenges, opportunities exist within our customer base, that’s where the magic will really happen.”

Gores is a journalist who covered business news for the Milwaukee Journal Sentinel for 20 years.

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Controlling Your Bank’s Destiny

Owners of family-owned and closely held banks meet at annual strategic retreat

By Hannah Flanders

Pictured (left to right) are: Peter Wilder, Godfrey & Kahn, S.C., Milwaukee; Richard Katz, Resource Bank, DeKalb, Ill.; Paul Foy, Cornerstone Community Bank, Grafton; and Chad Kane, WoodTrust Bank, Wausau.

Across the Midwest, many banks held primarily by a single investor or family face unique challenges in their day-to-day operations and future planning. As competition rises, it is critical that there are resources and networks dedicated to closely held bank owners as they navigate internal and external pressures in an effort to determine their own fate.

“It is important that we treat these banks for what they are first — family businesses,” said Peter Wilder, attorney at Godfrey & Kahn, S.C.

As such, closely held banks must not only consider regulatory, wealth, and succession pressures that all banks must balance, but interpersonal and family dynamics in addition. While challenges throughout the industry mount and opportunities for closely held banks to use their unique position to expand, resources and education pertaining specifically to family-owned or closely held banks remain marginal.

Banking on Family

It is no secret that operating a family business requires communication. While mutual respect between family members is vital, so too is having acknowledgeable peer network and counsel who are understanding of the unique benefits and challenges owners of closely held banks face. The growth and success of a closely held organization is dependent on one’s ability to navigate family dynamics, bank strategy, and the goals of all shareholders. In having the support of the family, educated advisors, and peers that can sympathize and share their perspective, bank owners will not only have the ability to avoid unnecessary difficulties, but gain valuable knowledge to facilitate the bank’s strategic next steps.

Family-owned banks must make special considerations when dealing with wealth and liquidity, succession, and estate planning. It could be, for example, that selling stock to outside investors to raise capital is not an option or that the next generation is not widely interested in running the family business.

While closely held banks face a variety of obstacles, opportunities for these banks are expansive. For one, family banks have the advantage of relating to their family business clients. Owners of family-run banks may not only serve as trusted financial advisors to local family business, but also as a resource for navigating challenges related to such structural ownership. Additionally, the overlap between bank management and bank ownership allows closely held bank owners to maximize efficiency and minimize conflict simply because there are likely fewer non-active owners to consult for every decision.

“It takes real commitment to plan for the future of a family-owned bank,” states Richard Katz, chairman of Resource Bank located in DeKalb, Illinois. “Family-owned banks are oftentimes the conjunction of a lifetime of personal effort, family legacy, and dedication to one’s community. With careful planning — aided by dedicated professionals — it is possible to envision a bright future for generations to come.”

Strategic Success

In order to assist bankers in navigating the unique challenges and possibilities available to closely held institutions, the Wisconsin Bankers Association (WBA), in partnership with the Illinois Bankers Association (IBA) and Godfrey & Kahn, S.C., began offering the Family-owned and Closed Held Strategic Retreat in 2019.

“Issues often seen in family-owned banks are usually not covered in broader events or conferences,” stated Wisconsin’s Cornerstone Community Bank President Paul Foy. “This specific retreat allows institutions to meet with legal and regulatory experts as well as network with peers facing similar challenges.”

“The Family-owned [and Closely Held Strategic] Retreat is specifically targeted at a group of bankers that do not often have access to similar resources,” highlighted Wilder. “The retreat underscores what succession, tax, and wealth planning may look like for each generation and how this planning gives ownership groups more control over their bank’s destiny.”

During the 2022 event, bankers in attendance at the Family-owned and Closely Held Strategic Retreat had the opportunity to hear from several panelists ranging from the ever-important topic of wealth to planning for the future.

Thank you to our 2022 retreat sponsors!

The event opened on Thursday, October 13 with a peer panel featuring Foy, Katz, and Chad Kane of WoodTrust Bank in Wausau. Attendees enjoyed gaining perspective from the banker panelists on why and how their families dealt with wealth transfers and the succession of the bank as it transfers to a new generation or new owners entirely.

Panelists emphasized that the intimate nature of such retreat has allowed attendees to gain a detailed understanding of how their closely held peers tackle the unique benefits and issues brought forth by closely held ownership.

The following day, Godfrey & Kahn S.C. colleagues Wilder and Jeff Billings presented on estate planning and the corresponding regulatory issues that closely held bank owners need to consider as they look ahead and transition bank ownership into new hands.

Eide Bailly’s Michael Holdren followed with an in-depth discussion on valuations specifically highlighting why closely held banks may consider a valuation; what the typical valuation process looks like; and how inflation, potential recession, reliance on net interest income, and regulatory oversight may impact the future of valuations.

The retreat concluded with an advisor panel featuring David Fritz and Patrick Marget of Executive Benefits Network (EBN); Brendan Freeman, First Business Bank; and Andrew Spillane, Godfrey & Kahn, S.C. The panel covered the role of life insurance, tax planning, and private fund investments to arm families with several resources to consider when wealth planning.

In addition to the thorough discussions and panels held at the retreat, many bankers state that the extensive networking opportunities remain the main attraction in returning each year.

“Not only are the various speakers geared specifically at closely held banks, but the intimate discussions I find myself having each year have been increasingly valuable in recognizing our goals as a family and as an institution,” said Foy.

“This event is not simply networking as you may perceive it from other events,” agreed Katz. “It’s partnership, friendship, deep connections, and the ability to share knowledge.”

Overall, the end goal of the Family-owned and Closely Held Retreat is to ensure shareholder value. From preparing the next generation for new responsibilities to understanding what options there are for those no longer keeping the business, the retreat presents bankers with an intimate setting to connect with their banking peers and other advisors who understand the intricacies of closely held banks.

“This program has been invaluable to the continued success of our bank,” stated Katz. “Its niche target has opened my eyes not only to the strategic opportunities that will benefit both the personal and professional aspects of the bank, but to the experts that are able to help us in implementing the change we wish to see.”

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2022 WBA Management Conference Recap

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Serving Increasingly Diverse Communities

PremierBank’s Bilingual Initiatives Committee helps bank serve Hispanic community

By Kathleen Rolfs

Between 2000 and 2015, the Hispanic population in Wisconsin doubled in size with an increase of 95%, according to a demographic summary conducted by the Wisconsin Department of Health Services. This was the most rapid population increase of any of Wisconsin’s various racial groups (White, Black/African American, American Indian, and Hispanic).

During this span of time, Wisconsin’s overall population increased by roughly 400,000 residents, with Hispanics making up 46% of this increase. With Hispanics being the fastest growing minority population in Wisconsin, it is important that community banks thoughtfully consider how they are best meeting the financial needs of this influential consumer base.

Although individual desires and product requirements are as diverse for the Hispanic community as any other demographic, one way that PremierBank is successfully serving our Hispanic friends and neighbors is through our unique Bilingual Initiatives Committee. This group is comprised of several bilingual bankers along with marketing and retail banking officers. The goals of the committee include identifying opportunities that exist within our communities for strategic community partnerships, and collaborative education within our organization to ensure all our bankers are equipped to understand and anticipate the needs of the rapidly growing, ethnically diverse Hispanic community.

Bilingual Bankers Share Their Heritage

At a minimum, having bankers on staff who speak the same native language of those who live and work in our communities is one of the most obvious ways that we can reduce or eliminate language barriers with our Hispanic customers and successfully deliver the most appropriate financial solutions to them.

Guided by our Bilingual Initiatives Committee, our bilingual bankers help provide education within our organization about the Hispanic community. Peer-to-peer learning is a powerful tool that helps break through biases and promulgates understanding. As such, we have found that giving our bilingual bankers many opportunities throughout the year to share their heritage with their colleagues encourages a much deeper understanding of our local Hispanic population, while simultaneously building community within our own organization.

During last year’s Hispanic Heritage month, PremierBank treated all employees to traditional pan dulce or “sweet bread” served fresh from a local Mexican baker. These were personally delivered by members who serve on the Bilingual Initiative Committee, some of whom were dressed in traditional Mexican apparel, with an explanation of the history of these tasty treats! Inexpensive activities encourage understanding and respect among a diverse workforce, while providing education about this important segment of banking prospects and customers.

Bilingual Banking Community Outreach

Whether through financial contributions, sponsoring a resource fair that targets the Hispanic community, or creating our own event that caters to the Hispanic community, PremierBank’s Bilingual Initiative Committee is intentional in the quest to find new events to support within our footprint area.

In September 2022, a “Hispanic Heritage Celebration” is being planned at one of our banking locations complete with food trucks, traditional Central and South American dancers, and a lively mariachi band. After working with the local convention and visitor’s bureau and receiving advice from the city parks and recreation department, our Bilingual Initiatives Committee has found enthusiastic community support in our efforts to plan this upcoming community event that will celebrate Hispanic customs, cuisine, and heritage.

Building Long-Term Relationships

As marketers, we know that the Hispanic segment is an incredibly valuable consumer group. With an annual purchasing power of over $1.5 trillion, this powerhouse community is more likely to start a new business than any other demographic and it accounts for a larger percentage of home purchases than ever before, according to an article published by Forbes. However, we cannot simply make token efforts to attract their business.

To reach this audience, cater to their actual needs, and stand out from our competitors, banks need to establish an authentic connection in an honest and respectful way. Our Bilingual Initiatives Committee is making a difference at PremierBank by helping us to build authentic, meaningful relationships both inside and outside of our bank. Because of this, the business relationships we have formed with our Hispanic customers and community partners are based on understanding and respect and will endure long into the future.

Rolfs, vice president – director of marketing at PremierBank in Fort Atkinson, is a member of the 2022–2023 WBA Marketing Committee.

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The Cost of Employee Financial Stress

How Wisconsin employers can best invest in the security of their team

By Hannah Flanders

As inflation and the cost of living across the country continue to rise, more employees are feeling the increasing strain of financial burden in their day-to-day lives. While some individuals may choose to seek higher paying positions to combat this stress, many are looking to their current employer to assist them in finding new solutions to managing these burdens.

Financial stress is often defined as any emotional tension an individual may experience related to money, debt, or upcoming expenses. According to a survey by Purchasing Power in March 2022, 97% of all full-time employees reported that they experience financial stress.

While monetary stress manifests in many different ways, employers should be concerned that these stressors weaken productivity, negatively impact company culture, and decrease overall talent retention.

What Can Employers Do?

According to the 1,100 full-time employees surveyed by Purchasing Power, 57% say the benefits their employer offers have a major to moderate impact on their decision to stay at their current job. While unemployment rates return to pre-pandemic lows, employers must develop attractive benefit packages that not only meet the needs of incoming talent but set current employees up for success.

These benefits — ranging from health insurance and vacation time to retirement planning and financial wellness programs — impact overall employee satisfaction, both personally and professionally, and save businesses billions of dollars each year.

In a survey conducted by the American Psychological Association (APA), money stress experienced among Americans registered at its highest recorded level since 2015. By regularly reassessing employee benefit plans, businesses are better able to accommodate for common stressors — such as retirement and emergency savings — in relation to current events. Additionally, these opportunities allow greater chances for Wisconsin employers to integrate new, relevant, and cutting-edge tools for members of their team.

The Importance of Financial Wellness Programs

More than ever, employees consider it the employer’s responsibility to help employees with their financial well-being. In addition to providing employees the resources they need to feel secure, businesses that invest in financial wellness programs are more likely to retain current talent and save on the cost of recruiting and training.

Today, wellness is no longer determined solely by physical health. In order to wholly provide for employees, employers must account for all aspects that create tension in one’s life. By promoting resources that help employees stretch their dollar, employers are increasing productivity, engagement, and attendance among those who may otherwise be severely impacted by their financial worries.

PwC’s Employee Financial Wellness Survey, conducted in early 2022 on over 3,200 full-time employees, highlighted that among the 29% of employees currently looking for a new job, 65% cite money as their primary reason. However, both financially stressed and non-stressed individuals surveyed reported being more likely to accept a position or stay with a company that they feel cares about their financial well-being.

Wisconsin employers who are not doing so already should consider adopting financial well-being into benefit packages and adding financial education opportunities such as private coaching as resources for every employee. As housing costs, gas prices, and living necessities skyrocket around the country, individuals are seeking additional initiatives that aid in overcoming the recent additional stress.

A Growing Need for Assistance

Similar to how the nature of work and its demands have evolved over the last three years, workers too are reassessing their financial priorities.

The U.S. Census Bureau states that, according to the most recent census data collected in 2020, Wisconsin’s median household income is $63,293, over $4,000 below the national average. Although the importance of establishing and ensuring a health emergency saving fund has been emphasized even more since the onset of the pandemic, a quarter of consumers still have no savings set aside for emergencies, according to the 2022 Emergency Savings and Financial Security report by the Consumer Financial Protection Bureau (CFPB). Additionally, 39% have less than a month’s worth of income saved for emergencies.

This lack of funds directly originates from, according to the CFPB, an individual’s knowledge on how to save. Whether it be lack of information relating to saving or financial constraints, those without emergency saving funds are nearly three times as likely to “not know how to save” than those who have a fund of some proportion.

The Society for Human Resource Management (SHRM) states that while upwards of 95% of organizations offer retirement savings plans, less than 35% offer financial planning/ coaching, and even less (15%) offer emergency savings funds or payroll advances, causing many individuals facing an emergency to charge a credit card, borrow money, or cut other expenses.

However, as the prices for necessities such as groceries, shelter, and gasoline rise — more Wisconsinites than ever are struggling to set aside funds for emergencies, their future, or even other commodities. In addition to setting a 40-year record for total increasing prices (a 9.1% increase since June 2021), both food and energy prices increased by 10.4% and 41.6% percent, respectively, in the last 12 months. These skyrocketing prices represent the largest price jumps consumers have seen since the early 1980s, according to data presented in the June 2022 Consumer Price Index.

Resources Available

Financial wellness programs, such as America Saves and Wisconsin Saves, not only help employers meet the growing demand for budgeting tools, but these campaigns also build consumer confidence, assist individuals in reaching their financial goals, and save businesses added expenses caused by absenteeism or low productivity.

America Saves and Wisconsin Saves provide individuals with the tools and education needed to effectively approach savings goals such as retirement, debt repayment, or vacations. Be it a long- or short-term goal, America Saves supports low- to moderate-income households in saving money, building wealth, and preparing for the unexpected.

The Wisconsin Saves initiative, brought forth by a coalition of Wisconsin organizations including the Wisconsin Bankers Association (WBA), promotes automatic saving opportunities through split deposit. The program, launched in 2021, encourages small- and medium-sized employers to promote the ease and benefits of saving automatically for emergencies through split deposit.

By promoting the success of these programs, encouraging employees to take the America Saves pledge to access additional resources, or motivating teams to split their deposit into a savings fund — Wisconsin businesses can play an important and impactful role in helping their employees improve their financial well-being.

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Embracing the Future of Work at WBA’s Management Conference

Join Wisconsin banking leaders in education and networking opportunities

Banking leaders from throughout Wisconsin will once again reconvene in Wisconsin Dells for a two-day event focused on education and networking. WBA’s Management Conference, beginning on September 13, is a must-attend event for CEOs, CFOs, CCOs, HR leaders, and other members of the bank’s management team.

An optional, pre-conference golf outing is scheduled for September 13 at Rock Golf Club in Wisconsin Dells. Bankers interested in additional opportunities to connect with their banking peers and event sponsors should plan to attend. Following the outing, the event will kick off on Tuesday night with a dinner program recognizing individual bankers who will be receiving WBA’s 30- and 40-year Lifetime Service Awards. Bankers interested in receiving this recognition or honoring an individual who meets the service award criteria should visit wisbank.com/ServiceAwards to complete the nomination form by August 19, 2022 to be included in the program.

On September 14, bankers will have the opportunity to attend two general sessions and two rounds of breakout sessions that include four management-related tracks including credit/lending, human resources, finance, and general bank trends.

In addition to networking among peers, Wisconsin bankers will hear from Sarah Sladek, founder and CEO of XYZ University, LLC during her keynote session on managing and leading during the new era of workplace shift that has recently emerged. While preparing for increasing innovation, shifting values, global connectivity, disruption, and opportunity, Sladek will assist bank leaders and organizers in understanding why they may be struggling to lead a high-functioning team as well as provide insight into how bankers may best be able to usher in a new generation of talent.

To learn more and register for the upcoming event in Wisconsin Dells, visit wisbank.com/management. Questions regarding the conference can be directed to WBA’s Lori Kalscheuer, director – education.

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Lead Your Team to the Next Level

WBA’s Management Conference Returns to Wisconsin Dells in September

Join over 150 banking leaders for WBA’s annual Management Conference September 13 and 14 in Wisconsin Dells. C-suite and HR professionals will enjoy several general sessions, breakout sessions, and opportunities to network among Wisconsin banking peers and over 50 conference sponsors and exhibitors from across the U.S.

The conference, to be held at Glacier Canyon Conference Center, will officially begin on Tuesday night with a dinner program and ceremony recognizing individual bankers who will be receiving WBA’s 30- and 40-year Lifetime Service Awards. Bankers are encouraged to attend this program not only to celebrate these milestone achievements, but for additional opportunities to network with banking peers. Bankers interested in receiving this recognition or honoring an individual who meets the service award criteria should visit wisbank.com/ServiceAwards to complete the nomination form.

Management Conference Banner

Before the dinner program on Tuesday, September 13, bankers looking to make the most of their time out of the office will also enjoy an optional pre-conference golf outing at Wild Rock Golf Club in Wisconsin Dells. Join WBA, your banking peers, and several sponsors at this unofficial kickoff for an additional opportunity to connect with banking leaders from around the state.

This year’s conference will focus on taking banking to the next level. By investing in opportunities to network with other community bankers and dive into topics that will help your bank succeed as a business, leaders are able to reinvest the skills and knowledge learned at the conference into every member of their team.

WBA encourages all bank management teams to take advantage of the four management-related breakout session tracks — including credit/lending, human resources, finance, and general bank trends — for the benefit of every leader, their team, and the continued success of their institution.

To learn more and register for the upcoming event in Wisconsin Dells, visit wisbank.com/management. Questions regarding the conference can be directed to WBA’s Lori Kalscheuer, director – education.

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questions@wisbank.com

608-441-1200

4721 S Biltmore Ln.
Madison, WI 53718

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