Banker to Banker

10 Ideas For Our Bank We Got From Wegmans

Banker to Banker

LEARNING FROM NON-BANKS Last week we tagged along with The Bank of Charles Town (BCT) crew who, like us, are heavily believers in “cultural tours.” BCT used a series of these tours to kick off their strategic planning season with the purpose of grabbing ideas that could spark creative thinking.

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The Price For Attention in Bank Marketing

Banker to Banker

BANK MARKETING If you are still spending money on print and direct mail, we ask you why? Not only is it hard to track, but it is likely the least effective form of marketing that you can do. While building a brand is good, generating an emotional connection is better.

Two Proven Secrets To Faster Bank Decisions - Part II

Banker to Banker

CRITICAL THINKING In Part I, we highlighted how having too much information about a decision often increases the confidence about the decision but usually doesn’t change the accuracy of the decision.

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Why Specializing in Commercial Verticals Can Boost Bank Profitability

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COMMERCIAL SEGMENTATION Much has been written about the merits of community banks developing banking expertise around specific verticals. We recently worked with a bank that won the banking mandate for a family-run funeral home. At first we were surprised that the term loan was 93% LTV.

Here Is Daily Bank App Usage Patterns And Why It Matters

Banker to Banker

DIGITAL MARKETING If you think the average American is on their phone throughout the day you are largely right. However, they may not be on your bank’s app.

8 Ways To Attract The Wrong Clients To Your Bank

Banker to Banker

MANAGING BANK CULTURE AND PROFITABILITY Given that strategic planning season is upon us, one key affirmation is to verify if you are targeting not the customers that you have now but the customers that you want.

Why Your Bank’s Strategic Time Horizon May Hurt You

Banker to Banker

Strategic Planning and Innovation If you look at the sensitivity in a bank’s budget, $1 of investment in a new line of business usually doesn’t break even for two to three years. $1 1 invested in finding a new customer usually returns about 9%, while $1 invested in a new product is usually above 20%.

The Hidden Risk in Commercial Lending

Banker to Banker

MANAGING CREDIT RISK Most risk managers are intimately familiar with the expected loss for credit and interest rate risk. However, fewer risk managers are familiar with the concept of unexpected loss.

How Financial Education Quantitatively Helps Banks

Banker to Banker

THE ECONOMICS OF FINANCIAL LITERACY Many banks put financial literacy education squarely in their Community Redevelopment Act (CRA) effort using the mindset that financial literacy is an affliction of low-to-moderate income households. The reality is, financial illiteracy affects us all.

How To Become A Better Trusted Advisor In Banking

Banker to Banker

IMPROVING BANK PRODUCT SALES A surge in alternative lenders and intense competition among banks has forced community bank lenders to further differentiate themselves and their institution. Many lenders are switching their professional focus from being a salesperson to being a trusted advisor.

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How Understanding Loan Demand and Credit Quality Will Make You A Better Banker

Banker to Banker

A common line of thinking in the banking industry, especially regulators, is that recessions are driven by, or at least exacerbated by, the supply of credit. Banks, in an effort to stay competitive, tend to drop their lending standards to hit their loan growth targets.

4 Trends From Money 20/20 That Will Influence Your Bank

Banker to Banker

Last week’s Money 20/20 conference in Las Vegas proved that it remains one of the best conferences for banks that are serious about innovation, particularly as it revolves around payments.

What The Fed Pause Means For Commercial Loan Production

Banker to Banker

COMMERCIAL LENDING STRATEGIES

How Your Bank Approval Process Hinders Innovation

Banker to Banker

If you want a more innovative bank, it starts, and largely stops, with what your approval process looks like for new technology. Take a human and force them to grow up in New York City. Around age 20, you force them to go to conferences on living in the outdoors, hunting, fishing, and survival.

The Status of Commercial Real Estate Values

Banker to Banker

CRE UNDERWRITING Recent data, just released from Real Capital Analytics, shows that since the start of the year (month-end April), commercial real estate (CRE) has appreciated 2.6% in 2019.

Do You Really Want To Lend Below A 10% Debt Yield?

Banker to Banker

PROFITABLE BANK LENDING Commercial lenders should be aware of the important factors that drive customer behavior to borrow funds. Our clients borrow from us when they refinance debt, or purchase equipment, real estate, or finance working capital.

Why You Are Watching The Wrong Lending Competitors

Banker to Banker

CREDIT MANAGEMENT No doubt, you hear all about how your competitors are winning deals because they are more aggressive when it comes to underwriting.

How To Use Goal Gradient Rewards In Banking

Banker to Banker

Put a rat in a maze, and they will speed up as they get near the end as can smell the reward. Forget rats, human sprinters also run the last 15% of a race faster than the previous 30%. Forget athletes, citizens make more donations to a charity as that charity gets closer to its fundraising goal.

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How To Get Better At Bank Email Notifications and Marketing

Banker to Banker

BANK EMAIL BENCHMARKS Send a bank marketing email out, and chances are 15% never reach the prospect’s inbox. That is not bad considering that it used to be above 25% just a couple of years ago. Bankers have been working hard at collecting email addresses and managing the distribution list.

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The One CRE Underwriting Metric You Are Likely Not Using, But Should

Banker to Banker

More Accurate CRE Underwriting Whenever your bank is looking at underwriting commercial real estate (CRE), you are probably looking at a variety of macro factors such as rent and occupancy trends, absorption, and capitalization rates.

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Adding Transparency To The Commercial Loan Closing Process

Banker to Banker

BETTER LOAN CLOSINGS There is a correlation between the speed of commercial loan closing and bank profitability, and there are many reasons why banks that close loans faster can generate more profits.

The Only 3 Things You Need To Focus on For Bank Strategic Planning

Banker to Banker

GAINING STRATEGIC VISION Strategic planning means a lot of things to a lot of different people.

Our 7 Question Test To Prevent Bad Bank Technology

Banker to Banker

BANK TECHNOLOGY DECISIONS The largest problem with bank innovation is that we see or hear about a sexy piece of technology at a conference or at another bank and then acquire it.

What Just Happened At Finovate Spring 2019

Banker to Banker

Last week, Finovate Spring 2019 took place in San Francisco in which over 270 banks watched more than 60 companies each have seven minutes to impress you with a demo of their technology.

Here Is The Latest Thinking For Libor Fallback Language

Banker to Banker

Today LIBOR is linked to over $250 Trillion (that is with a “T”) in financial instruments and has been used as a reference rate for more than 30 years. However, regulators, for various reasons, are driving a shift to an alternative reference rate.

Bank Worker Productivity and The Technology Imperative

Banker to Banker

BANK TECHNOLOGY INVESTMENT Back in the 1980s, there were more banks, smaller banks, and little technology. We were still driving checks around, there was no online banking, and networked ATMs was the latest in bank technology.

How To Get Conversational For Bank Search Marketing

Banker to Banker

“What do I need to open a checking account?” and “What is the best savings account?” are two trending bank-related searches that are becoming popular. In years past, potential bank customers used to put in a utilitarian “checking account” to search banks offering checking accounts.

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A Checklist For Any Bank Considering a Payment Strategy

Banker to Banker

Payment Innovation When it comes to long-range strategic planning in banking, what to do about payments, should be in the top five considerations up there with treasury management, capital allocation, risk tolerance, and human capital.

Banks That Want A Strong Culture Can Learn From This Netflix Document

Banker to Banker

BANK CULTURE When it comes to corporate culture, many banks know that building a genuine and sustainable culture is like baptizing cats. It’s tough work fraught with many scratches and a lot of moving around.

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How Optionality Impacts Your Net Interest Margin

Banker to Banker

IMPROVING NIM For the majority of bankers, maintaining or increasing net interest margin (NIM) is the single most significant focus today. The shape of the yield curve and lower rates have caused NIM compression across the board and have hurt bank equity performance.

How Great Bank Brand Stories Are Built

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BANK MARKETING Few bankers doubt the power of great storytelling. Instead of advertising, many banks have evolved into showcasing a customer, employee, or creative narrative that walks the reader to some point of conflict and then tells of a resolution.

How To Give Borrowers 30 Years of Amortization In 25 Years

Banker to Banker

LOAN STRUCTURING HACKS One battle currently waged in the banking industry is amortization terms and interest-only (IO) periods. Borrowers often have legitimate needs to extend the principal repayment on term loans to 30 years.

How To Avoid Structural Subordination In Commercial Bank Lending

Banker to Banker

INADVERTENT CREDIT RISK Too many banks in the last financial crises fundamentally misunderstood or did not pay attention to structural subordination risk. We feel that this pattern is partially repeating at some banks today.

What Bankers Need To Know About The Yield Curve

Banker to Banker

INTEREST RATE TRAINING Bankers should consider the shape of the yield curve when structuring and pricing loans to maximize return and reduce risk. The shape of the yield curve can also help lenders understand borrowers’ needs and better position the bank against competitors

Why The Next Quarter is Important For Lenders

Banker to Banker

The last quarter in the year is typically a suboptimal time to generate commercial loans. Most bankers have met their annual goals factoring the existing pipeline of credits.

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How To Use The Hybrid Loan Structure To Win More Profitable Clients

Banker to Banker

It sometimes pays to be opportunistic in marketing your community bank’s products. There is currently an exceptional market opportunity for community banks to win profitable business from larger competitors.

Does Loan Amortization Matter? [Plus Free Calculator]

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HOW LOAN STRUCTURE IMPACTS CREDIT Sometimes how we choose to measure something can lead to incorrect conclusions. While mathematically 30 is 50% more than 20, a 30-year amortizing loan is not 50% riskier, or 50% longer than a 20-year amortizing loan

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Changing Payments and Bank Strategy

Banker to Banker

BANK STRATEGY One item that should be on every bank’s strategic horizon is how to adapt to the changing face of payments. If you are one of those bankers that say, “Cash won’t go away in my lifetime,” you could be right.

Learn From A Pirate - Negotiating Bank Products With Customers

Banker to Banker

Those Somali pirates are a wily bunch. While pirate attacks off the coast of East Africa are down, the average ransom is up. Most of the increase can be attributed to going after more modern ships and with better negotiating tactics.

5 Reasons To Come To Our Bank Management Conference

Banker to Banker

2019 BANK MANAGEMENT CONFERENCE If you have not already, you should make plans to attend our 2019 Bank Management Conference which is coming up quickly on July 11 – 13, 2019.

The Best Way To Structure The First Page of a Credit Memo

Banker to Banker

IMPROVING YOUR CREDIT MEMO In banking, as everywhere else in life, you never get a second chance to make a first impression. The first page of a credit memo is essential for credit analysts, lenders, management, and board members.

Where To Digitally Advertise If You Are A Bank

Banker to Banker

When your bank places advertising, partners, produces content or conducts events, it is helpful to statistically know which subject matter is most, and least conducive to banking. For example, by our marketing data, if you are interested in banking, and getting the most out of your banking relationship, you have a 31.4% probability of also being interested (to the point of engaging with content) in travel

13 Of The Most Important Mary Meeker Slides Pertaining To Banking

Banker to Banker

TECHNOLOGY TRENDS Starting in 1995, star-analyst Mary Meeker, “The Queen of the Internet,” co-founder at ReCode, and partner at the investment firm Bond Capital delivers a 30-minute presentation on the state of the digital landscape.

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