When tax reform was first announced, there were plenty of predictions as to how the tax savings would be spent.
Thanks to the ABA’s Energizing the Economy list, we can actually see – in one place – how banks are spending their initial windfall. Across the list, there is a healthy investment in employees, whether it is raising the minimum wage to $15 or more, paying out bonuses, or providing more training and development. Some even created ways to give back to the community through new products (some with very appealing interest rates), lending more money to small businesses, or investing in their community giving programs.
It’s not surprising that tax savings will be spent on staff. According to the ABA Community Bank CEO Priorities for 2018 survey, recruiting and retaining talent is a top concern of CEOs, right up there with regulatory compliance and acquiring new customers.
I’m eager to see whether the next wave of tax savings spurs even more spending on customers, perhaps in the form of lower spreads and higher deposit rates. Or, whether we’ll see investments in the growth drivers revealed in the ABA study. Investments like these will not only benefit the bank but the community at large.The Energizing the Economy list is updated daily, so visit often to keep an eye on what your peers are doing. And, if you haven’t already, share how you’re using your tax savings to benefit the economy. I’ll be working on a future story highlighting how some Dashboard customers are using their tax savings. If you would like your institution to be highlighted in some way, reach out to your client support specialist and let them know. We’ll reach out to you later to have a quick conversation to learn more about your institution, what you are doing, and why you chose to spend the savings the way you did.