Give me your tired, your poor, your huddled masses yearning for interest rates slightly higher than the infinitesimal chance I have of winning the Powerball! Maybe I’m being a bit dramatic, but the Fed has been beating their metaphorical drum about rate hikes being ‘just around the corner’ for what seems like an eternity. It reminds me of Aesop’s famous fable where the boy cries wolf so often that it starts to become meaningless. Sound familiar? Perhaps it’s time for a little less talk and a lot more action…on the part of community banks and credit unions.

Here’s the deal. For the last few years, community banks and credit unions have been eagerly anticipating the smallest blip in interest rates that will bolster margins. We’ve been awaiting the return to acceptable levels of employment and inflation, while making sure the stars align so we could see a meager uptick in earnings. Furthermore, the Fed, with their frequent wolf cries, has been teasing the industry insinuating possible light at the end of the tunnel. The latest results of our September meeting indicates… that was a lie. <said in my best Maury Povich voice>

Realistically, and to cut the Fed some slack, timing probably isn’t best for the economy to undergo a rate hike. So what should financial institutions do? Should we retreat back to our offices, complaining about the “darn Fed” and their status quo decision making policy while silently crying inside and wondering what the next meeting will bring? OR, do we forgo our crystal ball and predictions about what the Fed will do? Community banks and credit unions should make a commitment to step outside the box and look for alternatives to drive revenue, improve performance, and grow earnings in ways you can control.

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