The banking industry has largely become acclimated to a challenging local operating market, sustaining positive and increasing levels of profitability on a consolidated basis for 3 consecutive years, reaching a Pre-Tax ROE of 7.1% in YTD 2016. Although the economic and fiscal landscape might very well continue to deteriorate in coming quarters before there is a turnaround, as per the Planning Board’s downward revised economic growth forecasts (-2.3% for FY 2017) and the daunting liquidity issues and debt obligations being faced by the government, Dodd-Frank Act Stress Tests (DFAST) results indicate that local banks can withstand additional pressures given strong capital positions. In this issue we will present trends in ATM-related indicators, check processing and POS transactions. ATM terminals, ATM debit transactions and check processing have all decreased significantly in the past 5 years, while POS transactions have materially increased, pointing to increased use of online/mobile banking and non-cash methods of payment. Lastly, we analyze the implications of interest rate hikes by the U.S. Federal Reserve Board on the local economy and banking sector.