According to Wikipedia, ancient Babylonians began each year by promising to return borrowed objects and repay their debts. Ancient Romans began the New Year by making promises to Janus, a two-faced god who represented beginnings and transitions. The month January is name for Janus. Neither the Babylonians nor the Romans had to deal with technology vendors. Ah, so much for the good old days!

Here is our suggested list of New Year’s resolutions, from a technology perspective.

1. Reread your technology contracts – especially core processing contracts.

Make sure to focus on limitations of liability, cost escalation, deconversion charge calculations, and service level commitments. You should have a firm understanding of each. There is no activity better suited for a dreary winter day than diving into a technology contract. Have plenty of coffee ready.

2. Gather your processing invoices and audit them.

Compare the charges to your contract. For vendors that increase each line item by the Consumer Price Index (CPI) – or whatever factor used for price increases – this can be difficult. Ask for vendor assistance to explain charges, if necessary. Vendors should support their charges. Compare invoices to your contracts to insure that calculations are performing properly and make sure only valid charges appear. Many contracts today allow a look back period of 12 months, therefore, if you find overcharges, the reimbursement period will be for only 12 months. We have found a surprising number of invoice errors when reviewing contracts during our engagements and some errors have been occurring for years.

3. Schedule a strategic overview meeting with your core vendor to discuss your institution’s goals and objectives.

This meeting will be an opportunity to find out how your core vendor can support specific goals and set milestones to be reached during the year. As a result, you will begin the year with mutually agreed upon objectives. Give your vendor a gold star if it requests this meeting before you do. Regardless, this meeting must occur whether your bank is inhouse or outsourced for core processing.

4. Review your contract expiration dates and consider strategies to follow in advance of expiration.

A good rule of thumb is to begin a competitive renewal 18-24 months in advance of expiration. Anything less than that can limit your options, sometimes severely.

5. Keep an eye on final regulations to be implemented later in 2018 according to the Office of the Inspector General’s Report on FDIC-Supervised Institutions’ Contracts with Technology Service Providers.

The FDIC concurred with the report findings and should have a response implemented by October 2018. This response could have a dramatic impact on technology contracts going forward. A link to the OIG Report on FDIC-Supervised Institutions’ Contracts with Technology Service Providers is provided below.

6. Identify all of the technology-related risk assessments maintained by your financial institution in order to perform the annual update process.

Annual assessments include adding any new threats and/or control processes associated with the technology or product line to determine if residual risk ratings are still within the acceptable tolerance level of the bank.

7. Prepare an IT Strategic Plan Outline.

IT Strategic Plan Outlines can be used as working documents to track IT projects, initiated by the IT Department and other areas within the company, with projected time frames and estimated costs for each project.

8. Review the company’s hardware/software inventory listing to identify any “end of life” systems that need to be replaced and included in the annual budgeting process.

9. Review monthly management reports to identify additional information statistics/or information that should be provided to management to enhance the oversight process.

10. Request employees to list any system issues presenting problems that have not been resolved and/or any system features/functionalities that are not available, but if enabled would improve efficiency.

This list should be used to follow through on opportunities to increase productivity and enhance customer service.

11. Resolve to call Darla Brogan, Senior Consultant at ProBank Austin, for Information Technology Audits, Operational Reviews, assistance with Information Security/Cybersecurity Policies and Procedures, and/or Business Continuity Plans.

Darla can be reached at (800)523-4778, ext 251, or via email at

12. Resolve to call Steve Heckard, Senior Consultant at ProBank Austin, for assistance with contract renewals or management of vendor evaluation projects.

Steve can be reached at (219) 246-2300 or via email at

Wishing you a happy, healthy, and productive New Year!


OIG Issues Report on FDIC-Supervised Institutions’ Contracts with Technology Service Providers