Agenda 2 New Environment and New Technology 1. P Preparing for - PDF document

2/15/2013 Y Your New Depository Contract N D it C t t Making it Work for Your District Presented by BBVA Compass Robert McDaniel Robert McDaniel , City President City President Gina Lobato, Public Funds Relationship Manager Melissa Leal, Treasury Management Officer Agenda 2 New Environment and New Technology 1. P Preparing for the RFP i f th RFP 2. Making the RFP Your Own 3. Evaluating the Responses 4. 1

2/15/2013 Objectives 3 o Incorporate best practices into your RFP’s I t b t ti i t RFP’ o Enhance success with RFP’s for Banking Services o Understand the Bank’s perspective o Create a mutually beneficial RFP The Current Environment 4 Historically low rates 1. Cost containment is job one Cost containment is “job one” 2 2. Followed immediately by revenue enhancement! 3. Regulatory changes 4. Collateral requirements • FDIC coverage • Increased paper and electronic fraud Increased paper and electronic fraud 5 5. Technology fuels change—and addresses risks in the 6. current environment 2

2/15/2013 Changing Technology 5 Efficiency and Cost Containment Payables outsourcing—paper, electronic and wire Payables outsourcing—paper electronic and wire   Paper to electronic conversion  Vendor payments via commercial card  Enhancing Receivables Internet payments  21 st century lockbox  Check image processing  Fighting Fraud ACH blocks and positive pay  Payables outsourcing  Look Back to Prepare for the RFP 6 Conduct a “WWW” review of your current depository relationship, and prioritize: relationship, and prioritize:  What’s Working Service Functionality Relationship Value  What’s Not Identify product and service gaps Quantify concerns about value 3

2/15/2013 Look Ahead to Prepare for the RFP 7 Continue the “WWW” process by considering:  What’s Next  What s Next Economy/revenue Expansion New technology New investment options Regulatory changes Regulatory changes Prioritize and Define 8  Must Have’s! Keeping what works p g Improving what doesn’t work Meeting regulatory requirements  Wants Improving what works Preparing for the future  We’re Exploring Adding new technology Changing processes Stay focused on the possible! 4

2/15/2013 Help Your Banks Prepare Better Responses 9 More information = better, more accurate pricing!  Provide volumes wherever possible  Provide volumes wherever possible “Blind” account analysis statements Historical transaction volume and balance data Listing of all services  Share balance information Interest bearing vs. non-interest bearing Use average balances vs. one point in time  Share your account structure  Share strategic plans that impact your depository relationship  Provide your most recently approved Investment Policy Tailor the RFP to Your District 10  Highlight “ must have ” services and features, such as:  Fraud protection for paper and electronic payments  Local cash vault services  Direct deposit of payroll  Local lockbox site  Ask for additional information in the sections that address your “ wants ”. These could include: dd “ ” Th ld i l d  Moving away from paper payments  Adding deposit alternatives  Offering internet payment options 5

2/15/2013 Tailor the RFP to Your District 11  Give direction on what you are “ exploring ”. Are you considering: id i  Enhancing your purchasing system  Converting to a new ERP system  Outsourcing payment services  Ask for new ideas and suggestions—free consulting!  Technology is changing rapidly  Innovations improve efficiency  Alternatives may be more cost-effective About Merchant Services and Commercial Card 12 Merchant Services   Consider a separate RFP for this service Be sure to include a current merchant statement or equivalent   Commercial Card Services  Good for gathering general information about the providers’ capabilities  For pricing and vendor selection, strongly recommend a separate RFP Vendor matching process insures best pricing V d hi i b i i Program structure should be a tailored to your accounting system Trend is to move to a two pronged program: distributed cards and vendor purchases 6

2/15/2013 Evaluating the Responses 13 Develop criteria such as:  Expertise Safety and Soundness Range of Products Market Presence Dedicated Team Rates/Pricing Research bank ratings  Fitch  Moody’s  S&P  Bauer Financial (www.bauerfinancial.com), IDC Financial Publishing  Include your criteria in the RFP  Ask for references  Consider presentations by finalists  Include product demonstrations  Especially important for new products and services  Keep Your Consultants 14 You may receive several good bid responses, but you can only pick one… only pick one…  Keep the next best 1 or 2 on your “consultant” list  Meet with each several time a year  You will get new ideas  You may find a vendor for a new financial service such as Merchant or Commercial Card  You will have several good banking relationships before your next RFP is due 7