Banker to Banker

Your Bank Probably Has Loan Size and Risk Wrong

Banker to Banker

MANAGING CREDIT RISK If you are like most banks you have your credit approval and risk process based around loan size. The assumption is that the larger the loan the more risk the bank is taking on so a greater level of risk review is needed. But, suppose the data didn’t bear that assumption out?

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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Why Your Bank Needs A Digital Lead Gen Strategy

Banker to Banker

GENERATING DIGITAL LEADS Unfortunately, in 2020, most bank websites are nothing more than brochure-ware. That is a problem as not only can a bank’s website be its most efficient source leads, but it should also be the best source of conversions (leads that turn into new accounts and loans).

Case Study: How To Win More Loan Business

Banker to Banker

We work on thousands of lending transactions every year with hundreds of community banks across the country.

Increase Deposits The Easy Way and Get a 150%+ Return [Template]

Banker to Banker

When you are a banker, sometimes your workload doesn’t come in neat memos or emails. A lot of stuff just gets dropped off on your desk with notes to “Fix This” (like below) or solve that. Fortunately, a lot of these problems are easy to solve.

How Your Customers Want to Communicate With Your Bank

Banker to Banker

Since your bank's primary value proposition is service and you are likely striving for a superior customer experience, then it would make sense that the first stop you should make is to improve your ability to communicate with the customer.

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.

Derivatives Are Tough But Hedging Is Easy (Get Our Documentation)

Banker to Banker

HEDGING FOR LOAN GROWTH With a flat and low yield curve, borrowers’ demand for long-term fixed-rate loans is high. Furthermore, based on the forward market and most analysts’ predictions, the yield curve is expected to stay low and flat in 2020.

Derivatives Are Tough But Hedging Is Easy

Banker to Banker

HEDGING FOR LOAN GROWTH With a flat and low yield curve, borrowers’ demand for long-term fixed-rate loans is high. Furthermore, based on the forward market and most analysts’ predictions, the yield curve is expected to stay low and flat in 2020.

Why Your Bank Should Be Using Derivatives Now

Banker to Banker

HEDGING FOR LOAN GROWTH With a flat and low yield curve, borrowers’ demand for long-term fixed-rate loans is high. Furthermore, based on the forward market and most analysts’ predictions, the yield curve is expected to stay low and flat in 2020.

The Irishman’s Guide To Bank Sales and Marketing

Banker to Banker

Throw all the facts that you want at someone, and you won’t move them to a position anywhere near the effectiveness than if you can work the facts into a story.

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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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.

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.

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.

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.

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 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 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.

3 Questions From Kat Cole To Make Your Bank Better

Banker to Banker

BANK PERFORMANCE For her sheer authenticity and clarity in thinking, Kat Cole remains one of our favorite corporate leaders in America. We met her at the ICBA a couple of years ago and just saw here last week at the ABA Marketing Conference. She did not disappoint.

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 Great Bank Brand Stories Are Built

Banker to Banker

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 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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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.

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.

Should Your Bank Pursue A Single Mobile App or Multiple App Strategy?

Banker to Banker

MOBILE BANKING STRATEGY In your strategic planning, one decision that needs to come up as you grow towards $1B in total assets is if your bank will have one mobile banking app or multiple apps.

How To Use NPV for Loans and Get Our Free NPV Calculator

Banker to Banker

RELATIONSHIP PROFITABILITY We were recently working to close a commercial loan when the lender officer paused the closing. He did not want his bank to spend legal fees to clarify some tax-transfer issues (costs which the borrower also refused to cover). The legal bill would be between $2 and $3k.

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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.

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.

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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An Agile Approach To Better Lending, Deposit and Fee Products

Banker to Banker

NEW PRODUCT DEVELOPMENT In past articles, we have talked at length about using agile methodology for application development, for technical product innovation, and for your risk processes.

Why Tuesdays and Thursdays Are Your Best Banking Days

Banker to Banker

BANK WEBSITE MARKETING While last week we focused on bank mobile app usage, in this article we take a look at how mobile and online usage compares to see what insights we can glean for bank marketing and customer experience management.

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Here is the Data on Bank Customer Problem Resolution

Banker to Banker

Assume for a second that your bank screws up and causes a problem. The customer comes in or calls to complain - Do you apologize? Of course, you do – but then what? For the most part, community banks are fantastic and solving problems and making customers happy.

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.

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 To Position Loans For the Debt Averse

Banker to Banker

INCREASING LOAN SALES There are many reasons why some customers are more debt-averse than others. Research has shown that millennials are particularly reluctant to take on debt and are also teaching their kids, Gen Z, to avoid borrowing.

How To Position Loans For the Debt Adverse

Banker to Banker

INCREASING LOAN SALES There are many reasons why some customers are more debt-averse than others. Research has shown that millennials are particularly reluctant to take on debt and are also teaching their kids, Gen Z, to avoid borrowing.

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.

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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.

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.

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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