Pub. 11 2020 Issue 4 16 West Virginia Banker Navigating the Pandemic — Where To From Here? By Gary Shook, Community Bankers’ Bank I n sitting down to write this article, I am reflecting upon what a year 2020 has been. We know 2021 will be different from 2020 but cannot predict the highs, the lows and the challenges coming our way next year. We, as individuals, are fortunate to be living in a resilient democracy. We, as U.S. citizens, are resilient. Because of our resiliency, our banking system is also resilient. Regardless of the ups and downs of economic cycles and the effects they elicit, our banking system has always, in the end, remained a source of financial strength. With that said, we at Community Bankers’ Bank (CBB) were curious as to how our bankers in the Fifth Federal Reserve District are processing the moving parts and pieces that 2020 has handed us thus far. In late September, using an independent moderator, CBB convened several Zoom focus group calls consisting of banking executives from across the 5th District. We were eager to hear what they have experienced. We wanted to hear where they think the industry is going. In general, we wanted to listen to the good, the bad, and even the ugly, and that’s what we heard. I want to share their opinions about our current circumstances, coupled with some reflection and forward-thinking. CARES ACT/Payroll Protection Program There was universal agreement within our focus groups that the Payroll Protection Program (PPP) brought new business opportunities to the community banking sector. Community banks offered a much-needed lifeline to small businesses within their communities, despite evolving PPP guidelines that were difficult to navigate the issues with the SBA loan application portal. Banks sprinted to deploy capital to small businesses when they needed it most. Bankers who partic- ipated in PPP were grateful to fellow employees, as well as their boards, for the nimbleness they exhibited by pivoting quickly to meet PPP demand. We inquired whether our focus group institutions limited PPP loans to existing customers or opened the process to all qualified applicants. Responses ranged from 100% existing customers to 80% of applicants being new to the bank. With that said, a significant percentage of PPP loans were made to existing customers among our participants. Bankers are working hard to “onboard” new relationships. With many retail and commercial banking offices being closed (due to COVID-19), keeping these new customers might be problematic. Some banks have tied sales goals to retaining new PPP customers. Others send weekly newsletters and various marketing communications to draw in new pros- pects and generate interest in a broader array of products and services. When we questioned our focus groups as to guidance on PPP loan forgiveness, there was generally a dim view about the process. Some have elected to utilize technology to assist with forgiveness, but most banks plan to use existing resourc- es. The SBA has made allowances for smaller loans of $50K or less. Our bankers are hopeful these loans will be forgiven, but there has been no legislative fix to ensure that. They hope small businesses and community banks are not put through more undue stress and aggravation. All focus group partici- pants were eager to get the forgiveness aspect behind them. Bricks and Mortar Branches Versus Mobile Banking Most of the bankers said that considering the changes in delivery brought about by COVID-19, they would need to take advantage of growth opportunities. These may exist in branch structure and delivery.