The Headache: Community bank efficiency ratios are deteriorating, FDIC reports.

Our Question: Why? And what can be done to reverse the trend?

Come see what other bankers think, and add your own views

 
Deep in FDIC's latest figures was a chart demonstrating a serious degradation in community bank efficiency ratios.
 
The deterioration began in 2006 and has steadily grown worse.
 
At yearend, the average ratio for banks under $1 billion stood at 74%, versus 64% at the end of 2004. Through most of the same period, banks over $1 billion in assets have improved, with an average ratio of 53% at yearend, versus 57% at the end of 2005.
 
We have our own guesses on the causes. But tell us why you think this has happened; whether it matches your own bank's experience; and what your bank is trying to improve things.
 
Let's hear your views and ideas below!
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