Financial Institutions Demonstrate Agility, Flexibility to Meet Profitability Goals According to Syntellis Report
The 2022 CFO Outlook for Financial Institutions report reveals 92% of finance leaders expect to meet or exceed 2021 profitability goals, 76% met or exceeded 2020 targets
CHICAGO – December 7, 2021 – Syntellis Performance Solutions’ 2022 CFO Outlook for Financial Institutions report, published today, explores the factors impacting the sector over the past year, as well as the trends and opportunities financial institutions will face in the coming year.
Looking ahead to 2022, financial leaders say agility is critical to remaining profitable. The report uncovered that the majority of institutions (84%) need to do more to leverage financial and operational data to inform strategic decisions, while over a third of institutions remain hindered by continued reliance on outdated and time-consuming means of budgeting, such as spreadsheets.
“As we move through the ongoing COVID-19 pandemic, flexibility and agility have taken center stage in navigating an uncertain landscape,” said Flint Brenton, CEO of Syntellis. “After facing significant challenges in the past two years, financial institutions remain resilient and have embraced nimble planning and quick adjustments to remain profitable. We expect to see more of these changes as institutions leverage new technology to improve budgeting, forecasting, reporting, and scenario analysis.”
Key findings of the report include:
- Decision makers remain in the dark: Institutions are not proactively addressing known capability gaps — 59% of bank and credit unions acknowledge that their data visualizations and dashboards are insufficient, limiting visibility and making timely business decisions difficult.
- Tools and processes remain outdated: Over a third of respondents still rely on spreadsheets as the primary means for incentive compensation (48%), budgeting and forecasting (39%), scenario analysis (36%), and profitability analysis (34%), indicating there is room for vast improvement.
- Economic uncertainty takes its toll on budgeting: The ripple effects of economic uncertainties from the pandemic have prolonged budget cycles, with 43% reporting that budgeting takes 12 months or longer (compared to 14% in 2020).
- Talent, organization and recruiting methods meet worker needs: 82% updated workforce and compensation offerings in the last two years, and 65% said employees had more flexibility to work remotely, meeting employee demands for job satisfaction. 36% have also moved staff to different job functions to meet the organization’s needs.
- Businesses adapt to income models: More than half (52%) of institutions experienced growth in interest income from sources such as Paycheck Protection Program (PPP) and mortgage loans, while 45% saw expenses grow. Larger institutions with $5-$9.9 billion in assets were most likely to see growth in non-interest income at 76%, followed by the smallest institutions (under $1 billion) at 67%.
- The technology transformation is expected to continue: Over the next 12-18 months, 42% of leaders anticipate increasing their use of predictive analytics, 30% plan to use artificial intelligence, and 26% will invest in machine learning.
“The data in Syntellis’ CFO Outlook report, and the information we’ve heard from customers, shows that financial institutions have navigated significant disruptions with agility and skill, and that they can continue to evolve and improve financial performance with the help of purpose-built technology,” said Danny Baker, Vice President, Market Strategy, Financial & Risk Management Solutions at Fiserv, a Syntellis strategic partner. “The industry as a whole must move beyond its reliance on spreadsheets and disparate systems and seek out integration, which will maximize the insights gained from planning and profitability analysis and promote sustainable growth.”
The 2022 CFO Outlook for Financial Institutions report is based on the results of online surveys completed in late 2021. Nearly 200 finance leaders participated in the surveys, representing a variety of financial institutions including banks, credit unions and other providers.
About Syntellis Performance Solutions
Syntellis Performance Solutions provides innovative enterprise performance management software, data and analytics solutions for financial institutions. Syntellis’ Axiom software helps finance professionals elevate performance by acquiring insights, accelerating decisions and advancing their business plans. For more information, please visit www.syntellis.com.