Strunk at the ABA’s Virtual Risk Management Conference 2021

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We’re getting the hang of these virtual events at Strunk!  Strunk attended the ABA’s annual Risk Management conference last week. During the virtual event we hosted a virtual booth, met with many familiar and new faces via Zoom meetings and attended virtual sessions. We enjoyed the opportunity to connect with bankers across the country.

We welcomed the opportunity to discuss with attendees the latest features offered by our Governance, Risk Management and Compliance (GRC) software Risk Manager, which includes six GRC tools – Risk Assessor, Policy Manager, Controls Manager, Skills Manager, Issues Manager and Vendor Manager.

A state of the industry was provided by Dr. Catherine Mann, currently the Global Chief Economist for Citibank. The session included an update on the economy, focusing on pandemic recovery in all key sectors. She also shared thoughts on key economic risks for financial markets and how this impacts risk mitigation efforts. The session also included a keynote address by Rob Nichols, President and CEO of the American Bankers Association.

Attendees had the opportunity to discuss post-pandemic risk management, among many other topics. Bankers were encouraged to reassess and modify risk management frameworks as a result of the pandemic, especially reviewing and adjusting risk appetites and associated metrics.

Congratulations to the winner of Strunk’s giveaway, a $100 gift card to Amazon – Linda Schnitzler of The Canandaigua National Bank and Trust Company!

We hope to see you all in person next year. Until then, stay well.

Do Business Accounts Have To Opt In To Reg E?

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Over the years Strunk has been asked a number of times, “do business accounts that have overdraft privilege have to opt into Reg. E to have their debit card point of sale and ATM transactions covered in the program?” To understand this you must first understand that most consumer protection rules do not apply to deposit accounts held by a business. It is also important to understand that a business-purpose account can be held by a legal entity, such as an LLC or a corporation, or by individuals operating a business themselves as a sole proprietorship.

We need to take a look at Regulation E and break it down regarding this topic. The coverage of Reg. E is stated in section 1005.3(a). It applies to “electronic fund transfers” that debit or credit a “consumer’s account.” Paragraph 1005.2(b) (1) defines an “account” as a consumer asset account established primarily for personal, family, or household purposes. Paragraph 1005.2(e) defines a “consumer” as a natural person. The result is if an individual is using their deposit account for the purposes of operation a sole proprietorship or an account is held by a legal entity, it would not be covered by Reg. E either.

Reg. E coverage means that the “opt-in” for overdraft coverage of debit card point of sale and ATM transactions only applies to consumer accounts. Any application of the concept to other accounts (such as business accounts) is a matter of bank policy and should be addressed in the bank’s deposit account agreement for such accounts.

Why has your Financial Institution missed out on Small Dollar Installment Lending?

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Community banks and credit unions have been shut out of the small dollar installment lending business due to the cost of taking an application, getting a credit bureau report, underwriting the loan, getting documents signed, funding and servicing the loan. Industry experts say that the cost to underwrite consumer loans typically runs $150 or more, with annual servicing cost running as high as $180 per year…doing it the ‘old school’ way.

Strunk has partnered with Quilo to provide a digital platform to make instant consumer loans for online or point of sale purchases. Large mega banks and FinTech companies have been offering these types of loans for several years and community financial institutions have been unable to keep pace. The Buy-Now-Pay-Later “BNPL” business is booming across the nation and Millennials, Gen X, and Gen Z’s are using the service…just not with your financial institution.  UNTIL NOW!

Quilo provides an opportunity for your institution to increase loans, net interest income, and offer an exciting service that consumers love, all from an app on their Smartphone. It allows consumers to make purchases and pay for them over a 3-24 month timeframe. It takes the stress out of lending…consumers don’t have to share their soul to borrow $500 and the financial institution doesn’t have to stress over telling them we don’t make small loans.

With tremendous growth potential in this segment of installment lending it doesn’t take long to show you how this would work for your financial institution. Take back the consumer lending business from the big banks and FinTech companies.

To learn more about Quilo contact Strunk at info@strunkaccess.com or 800.728.3116 for a quick demo of the Quilo Instant Installment Loan Program.

Conveniently Retain Report Copies

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Strunk’s hosted ODP Manager solution allows you to export and save your institution’s reports as Excel or PDF files. In addition to data from your most recent extract file, you are also able to access reports from your most recent seven As of Dates.

If you typically refer back to past reports for further analysis as you have time available, ODP Manager can streamline your report retention process. Instead of manually exporting and saving copies of reports, Strunk can set up your reports to be automatically archived after each import.

Once Strunk has created your report archive with your requested reports, PDFs are automatically saved within ODP Manager after each import of your daily extract file. Archived reports are easily located within a special Archived Reports section and are organized by As of Date.

Don’t worry about locating past reports – let Strunk manage your ODP Manager report archive! Please contact Strunk Support at support@strunkaccess.com with any questions or to find out more about using this feature.

Do you properly evaluate vendor risk?

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Understanding vendor risk is an extremely important part of your vendor management program.  Each vendor that provides a product or service to you may have some inherit risk that your organization may take on.  Knowing the inherit risk for each of your vendors before you go into contract with them will provide insight into whether or not the vendor handles any critical business function, have access to sensitive customer data or if they interact with customers.

Risk assessments will not eliminate the risk associated with the vendor, but the risk assessment can help minimize the impact on your business.  Once the vendor’s risk has been identified then you can decide if those risk can be eliminated by knowing what controls that vendor has in place.  The vendor’s controls should be reviewed to make sure they are effective and also monitored.

A successful vendor risk assessment can assist with:

  • Rating each vendor according to risk
  • Assessing each vendor relationship at the service or product level.
  • Determine which vendors need to complete vendor surveys to determine what controls they have in place for their risk.
  • Determine the due diligence requirements and the frequency.

Even though risk assessments are a prevented step in the vendor management process, organizations should always perform periodic vendor risk assessments to ensure its vendors are keeping up with its quality standards and not introduction risks to the company, its customers, and investors. https://strunkaccess.com/vendor-manager/

Strunk at the ABA’s Virtual Conference for Community Bankers 2021

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For the first time, Strunk attended the ABA’s annual Conference for Community Bankers virtually. During the virtual event we hosted a virtual booth, met with many familiar and new faces via Zoom meetings and attended virtual sessions. While a bit different than being together, it remains one of the most anticipated events of the year and we made the most of the connections with bankers and enjoyed seeing everyone.

We welcomed the opportunity to discuss with attendees the latest features offered by our Governance, Risk Management and Compliance (GRC) software Risk Manager, which includes six GRC tools – Risk Assessor, Policy Manager, Controls Manager, Skills Manager, Issues Manager and Vendor Manager. Strunk’s Overdraft Program is always a hot topic of conversation and we were glad to discuss our approach with long-time clients and potential clients.

Attendees had the opportunity to hear from keynote speaker, former NBA star Earvin ‘Magic’ Johnson in his session ‘The Power of Magic’. On top of his athletic notoriety, Magic is a driven and successful entrepreneur who shared what it takes to truly make an impact.

Another interesting session was hosted by Ron Shevlin of Cornerstone Advisors on the five forces shaping the banking industry today. He detailed how challenger banks, big tech, embedded finance, artificial intelligence, and cryptocurrency are affecting our banks and provided areas of focus for community FIs.

Congratulations to the winner of Strunk’s giveaway, a $100 gift card to Amazon – Mayra Rinaldi of Columbia Bank!

We hope to see you all in person next year and to once again host the conference t-shirt station. Until then, stay well.

Are you tired of doing Risk Assessments?

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We hear comments from community bankers across the country that they don’t like doing risk assessments and that they are time consuming. Risk Assessments generally come in the form of Excel Spreadsheets or Word documents. Often times they are done in silos where each functional area of the bank does their regulatory required risk assessment and periodically reports them to the bank’s board for review/approval.

Many banks do risk assessments for the regulators which is typically the wrong approach, in Strunk’s opinion. Risk assessments are done annually for those required by regulations and sometimes others are done two weeks before the regulators walk in. Risk Assessments should be designed to give senior management, board and ownership a snapshot of what risks your bank faces and what has been done to mitigate those risks. High risks aren’t bad; they just need to be managed.

Regulatory scrutiny of BSA/AML, ACH, Fair Lending, Loan Concentrations, Cybersecurity, Information Technology and other areas of the bank have caused financial institutions to spend more time and money focusing on the risks the bank faces. Outsourcing some of these functions to vendors is an expensive way to manage the risk assessment process and certainly unnecessary. Strunk’s GRC (Governance, Risk Management and Compliance) solution makes the risk assessment process easy to do and it consolidates all areas of risk the bank faces into one report.

Bank examiners often tell the community bank that they are coming out for the annual exam six weeks to two months prior to actually showing up. Generally, they ask the bank to send an extensive amount of information prior to coming onsite. This gives the regulator time to form their opinion on what risks the bank faces before arriving at the bank.

Strunk’s solution lets the bank tell their story rather than have the regulator tell the bank’s story to them. Comprehensive risk assessments are made easy with Strunk’s Risk Assessor Solution https://strunkaccess.com/risk-assessor/.

New Look & Feel: ODP Manager v2

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This month’s Strunk Access release introduces an all new look and feel for current ODP Manager clients. In an effort to continuously utilize the latest technology, Strunk stays on top of monthly updates that not only improve feature functionality but also application performance.

ODP Manager v2 consolidates Collection Letters, Custom Letters, and Ad Hoc Form Letters into a single menu option. When users click on Letters in the purple menu bar, they will now select either Collection Letters, Custom Letters, or Ad Hoc Form Letters from the menu. It is easier than ever before to generate letters once the proper menu item is chosen. Clients can also print a sample letter from the generation screen as needed.

These letter types can be used when creating templates to organize the different kinds of letters a client uses. Type Collection should be used for standard collection letters, type Custom will be chosen for all types of consumer communications and type Ad Hoc Form for letter types that need to be sent on demand.

Strunk CEO Dan Roderick says “I want clients to be able to stay on top of their programs and focus on what’s important to their organization. Strunk is committed to ensuring our applications are easy-to-use and continuously updated, to take that additional burden off their shoulders.”

ODP Manager is the most powerful tool available to help financial institutions get the most benefit out of their overdraft programs and remain in full compliance with the law. The application is provided as a cloud-hosted application, taking full advantage of the latest software developments and eliminating the need for users to maintain a separate application in their own network environment.

Help Your Customers Opt In for Regulation E Online

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ODP Manager includes letter templates that allow your customers the opportunity to opt in for Regulation E so they can authorize Overdraft Privilege service for ATM withdrawals and everyday debit card purchases. Did you know that ODP Manager can also help you offer your customers the option to opt in on your website?

Strunk can create a Reg E opt in form and Reg E opt out form that mirrors the content in your ODP Manager letters. You would then add links to these forms to your website.

When your customer submits the Consent Form for Overdraft Services or the Consent to Opt-Out, the opt in or opt out request is tracked in ODP Manager. The customer also is emailed a confirmation of their Reg E submission. Periodically, you review the new customer responses in ODP Manager and generate a list of the accounts that need the Reg E election updated. You perform the appropriate maintenance in your core software – updating the account record to either opt in or opt out the customer’s requested account. The ODP Manager software always shows you the most recent responses that you have not yet reviewed. The list of submissions is retained so you can look up past responses.

Let ODP Manager expand your options to allow your customers to choose Overdraft Privilege coverage for ATM and everyday debit card transactions. Please contact Strunk Support at support@strunkaccess.com with any questions or to find out more about using this feature.

Managing your Vendor’s Service Level Agreements

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Vendor Manager automates vendor due diligence, provides a practical framework for deciding which vendors to assess in depth, assesses the risks they present, and monitors their performance.

Defining and managing Service Level Agreements (SLAs) with your vendors is a very important aspect of your Vendor Manger program.  An SLA defines the level of service expected by you from a vendor, laying out the metrics by which that service is measured, and the remedies or penalties, if any, should the agreed-on service levels not be achieved.  Monitoring SLA takes place after the contractual agreement to meet the client expectations is executed. Having a central location to clearly identify, define and review your SLA is critical to your Vendor Manager program.

Being able to create reports to understand where potential problem areas with your vendor’s service that they are providing is key to a quality vendor manger program.  Strunk’s Vendor Manager software has the capabilities to help you manage your vendor’s SLAs and it provides a central repository to track your vendor’s performance to make sure they are meeting your business needs.

Use Strunk’s Vendor Manager to automate a cumbersome process into a well-organized, self-documenting work flow. In addition to tracking the performance against key SLAs, use Vendor Manager to maintain your list of key vendors and associated contracts, to assess the inherent risk presented by each vendor and to complete the annual review of each relationship.

An independent certified public accountant has examined Strunk’s operations and found them to be in compliance with the AICPA’s Trust Service Principles. It was determined that Strunk meets the Security, Availability, Processing Integrity, Confidentiality, and Privacy criteria for SOC 2 established by the AICPA.