Correspondent Blog

Since their emergency rate cut last Sunday the Fed has been hyperactive in instituting new programs in order to provide liquidity and apply some cushion to the economic fall.  The Fed quickly grasped the gravity of the situation and the coming dive in economic output with an array of programs that we thought/hoped we wouldn’t…

How To Create A High Performing Bank With An Employee Handbook Let’s be honest. Your bank employee handbook is probably a snooze-fest. If you are like most banks, your employee handbook was likely cobbled together from a template given to you by a third-party human resources firm or a revision of another bank’s handbook. Chances…

As the virus spreads its way across the U.S., the question turns to how long will this last? You’ve no doubt seen the charts that compare case numbers by country and across time. Looking at the results from China they started reporting cases in early January and are now taking tentative steps to return to…

The economic implications of coronavirus are expected to be widespread and are already causing some borrowers to be concerned about their ability to make loan payments. Many of our bank customers have used the ARC program to fix rates for borrowers while retaining a variable rate. Some of these borrowers in profoundly affected sectors, such…

The Fed did more than cut rates on Sunday; they pumped a massive amount of liquidity in the system, sending a signal to banks to level up. Far behind the health of employees and customers in the COVID-19 pandemic, comes the economic impact. Unlike the recession of 2008, where the economic impact came over many…

The Fed met in emergency session yesterday and cut rates 100bp (0.0%-0.25%) and also reinstated quantitative easing. The move on a Sunday afternoon underscores the seriousness of the developing coronavirus and the Fed dug deep into its tool kit. In addition to cutting rates to zero they also announced they will purchase $500 billion in…

It’s risk-on Friday (the 13th) after several countries stepped in overnight with both fiscal and monetary plans to deal with the ongoing crisis. The biggest of the plans is from the EU with officials ready to suspend fiscal rules to increase flexibility in dealing with the crisis, and the normally fiscally conservative Germans are declaring…

The unrelenting flight-to-safety trade took a breather yesterday, but it in no way represents a turning of the tide for this morning the risk-off trade is with us once again. The impetus for the move this morning stems from the uncertain fiscal stimulus that is still being hashed out in D.C.. While some of the…

There is now little doubt that the coronavirus will spread globally and will cause more supply and demand shocks in the market. While economic activity will slow, the amount and duration of the slowdown are big unknowns. Community banks may not have exposure to Chinese markets and may not have significant exposure to the energy…

Apparently We Can Go Pretty Low If anyone thought the late February stock sell-off would be a one and done development the week just past, and this certainly morning, have cracked that illusion big-time. Historic moves are in store this morning with the 30-year bond moving overnight to a low yield of 0.70% and is…

When we talk about unforeseen Black Swan events, the COVID-19 virus fits the profile. It has come out of nowhere, taken lives, disrupted public health, altered our daily lives, causing financial market volatility, caused more than five standard deviations of movement in interest rates and likely to have a material impact on credit markets. This…

February was another strong month for the labor market but with the survey week occurring prior to news of the coronavirus reaching U.S. shores it’s likely the last solid jobs report for the next several months. And even though the report was mostly solid, the bifurcation of the economy continues with most of the strength…