The News: Capital One is one of the first U.S. banks to offer a high interest checking account for business customers: Clear Interest Business Checking. With the Clear Interest Business Checking account, Capital One provides customers with high interest rates for the first 12 months (market rates thereafter) along with a business specialist to help business owners better manage their money. EVP of Capital One’s Business Banking Peter Appello explains that Clear Interest Business Checking will enable business customers to manage their business’ money more effectively while also earning interest on their accounts. 

Board’s View: The recent repeal of Regulation Q allows U.S. banks to pay interest on business deposits. But Capital One’s Clear Interest Business Checking goes beyond a basic interest-bearing account and instead is an example of banks placing a greater emphasis on cash flow management and customer experience strategies. Moving away from traditional relationship banking, business owners are placing more value the bank’s ability to help them manage their cash flow and provide easy to use and convenient banking solutions. As businesses focus less on borrowing and more on cash reserves, leading banks are attracting and retaining their customers by providing innovative services and products that help them put cash balances to better use.

 How Can We Help: To learn more about customer needs and preferences in the post crisis era please consult our profile of business owners and the full summary of results from our multinational survey of business owners.

 Read the full article at Market Watch.

What does it say when the senior leadership of banks in even relatively-healthy Australia call the changes to our industry profound? It’s time to sit up and take note. In a wide-ranging and fascinating interview, these eight Australian executives see a world where capital, liquidity, and risk pricing are permanently altered. They predict:

• Higher and Sustained Margin Pressures. The cost of funding new business will remain higher, in part due to expected regulatory changes like Basel III. These expenses will be reflected in lower margins for the bank, higher costs for the customer, or both.
• Increasingly Savvy Customers Who Shop: As a matter of necessity, corporate treasurers will more aggressively diversify funding. This dynamic has only begun to play itself out, suggesting that the depth of this disruption remains unknown.

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