The American Bankers Association recently published the results of their annual survey of community banking CEOs. It is a good read linked below. What really struck me was once I read down to Figure 6 titled, “What keeps you up at night?”, there were ten responses ranked from most to least concern. Not surprisingly, the top three items were net interest margin, growing core deposits and an IT data breach. The last two were interest rate risk and recruiting / retaining talent. I really can’t say that any of the ten issues listed shouldn’t have been there, but I was really surprised about two issues that were not listed: getting more innovative and attracting / retaining younger customers. If you follow this blog, you know these are two hot button issues for me. Are these more important than core deposits or IT breaches? Certainly not. But are they “as important” to the extent that they should be on the minds of community bank CEOs therefore making this list? Certainly. Try this thought experiment: If deposit rates were to dip back down to nearly zero, what would the effect be on the health of the financial institution 5 years from now? Would you predict there would be a loss of a significant percentage of the institution’s customer base and the associated deposits? Now consider you ignore young millennials and Gen Zs and make no effort to market to them or create services tailored specifically to attract and keep them as customers. What effect would that have on your institution in 5 years? Consider that in the next 5 years, dozens or perhaps hundreds of older seniors and baby boomers will pass away. Their money will pass down to younger generations, perhaps even skipping their Gen X children and passing to younger millennial and Gen Z grandchildren. Without a strategic effort to attract and retain these younger customers, is it possible, even likely that in 5 years’ time you would see a reduction in overall accounts and the associated deposits? Two of the main attractors of younger customers is how much an institution is seen as “doing good” and the level of innovation they exhibit. Doing good is certainly top of mind for all community bankers; you are actively involved in your communities and helping both consumers and small business owners in your service areas. However, as an industry, we may not communicate this level of “goodness” effectively to young millennials and Gen Zs. We have good stories to tell, so we should be better storytellers. Maybe you have been interested in advancing the institution’s ability to be more innovative but are not sure exactly how to accomplish that. Maybe you would love to have a strategic initiative to be more proactive in attracting and keeping younger customers but don’t know where to start. FNBB has resources available for you to ramp up your innovation quotient. One such service is our Innovation Workshops. The workshop is a half-day session that specifically focuses on opening up the minds of attendees to imagine that the future of community banking could be different, not just in general, but specific to that institution. The workshop is generally tailored to a specific strategic focus for that institution. Here are several options for innovation workshop focus areas: Banking Younger Customers Next Generation Digital Banking Capitalizing on Your Payments Franchise Retail Branch Transformation Expanding Treasury / Cash Management Services Exploring the Customer Journey A workshop is generally 12 to 20 participants representing a cross functional selection across all departments. Some institutions have booked multiple workshops to enable every employee to participate in one, which is a great idea as everyone, regardless of their position, can be looking for innovations that lower operating costs, increase revenue or improve the customer experience. The future is rooted in younger generations. These digital natives will not bank like their parents or grandparents. Attracting them requires new marketing techniques. Keeping them requires robust digital tools, access to advanced payments and an innovative approach to customer service. The next 5 to 8 years are critical for your institution to make a strategic decision to focus on this important issue. Failure to do so will not immediately become dire but down the road, it is unlikely that you will be able to “catch up” in becoming relevant to younger customers. The time to act is now. Need ideas on how you can be more relevant to younger customers? Download our white paper on The Next Generation of Banking here. There are 12 Innovation Workshop slots available for FNBB customers this year. Why wait, contact dpeterson@bankers-bank.com or your relationship manager and reserve one of those 12 slots for your institution right away. It might be the most strategic meeting you hold all year. Resources https://www.aba.com/news-research/analysis-guides/community-bank-ceo-priorities-2025 The views expressed in this blog are for informational purposes. All information shared should be independently evaluated as to its applicability or efficacy. FNBB does not endorse, recommend or promote any specific service or company that may be named or implied in any blog post.