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Capturing UFOsUnparalleled Funding Opportunities
Neil Stanley
Factors in Assessing Your Current Situation
- Long-term Deposit Volume Trend- Brokered Deposit Volume Trend- Other Borrowed Funds Volume Trend- Cost of CD Interest Expense Compared to Peers- Cost of Funding Earning Assets- Change in CD Interest Expense- Competitive Pricing Position- Loan-to-Core Deposit Level and Trend- Overall Financial Performance- Number of Offices- Market Footprint
Funding Volumes/Trend
Cost of Funding
Marketplace Position
Funding Needs
Marketplace PositionPros and Cons to This?
APY
Marketplace PositionPros and Cons to This?
APY
Marketplace PositionPros and Cons to This?
APY
Are your depositors going to settle for this?
How are Your People
Responding to Ads Like This
From Competitors?
How are Your People
Responding to Ads Like This
From Competitors
Who Are Closer to Home?
Bankers Have New Tools
10 Ways to Make CDs Cool Again
https://www.linkedin.com/pulse/10-ways-make-cds-cool-again-neil-stanley/
Switch to a Dynamic Rate Sheet
AdaptableAdd your current standard terms, rates, and logo.
Value DepositorsLet your depositors know it’s about them by creating a rate sheet that uses the depositor’s name.
Straight TalkTurn APY into terms your customers know and understand.
Simply plug in the amount a customer wants to deposit and show your offerings in dollarsrather than basis points alone.
Show How You Compare in Dollars
Compare Your RatesGive your frontline easy access to survey data.
Survey DataSurvey data is uploaded to the tool on a weekly basis to keep your team up-to-date with the current market.
Win!Data suggests that depositors who are given options in terms of dollars per month are more likely to stay with your institution.
Customize Maturity Dates & Offer Relationship Pricing
Anticipate NeedsOffer and price certificates that mature at any future date.
Examples include:• Tax day• Year-end• Birthdays• Graduations• Anniversaries
Retain Maturing CDs with Limited Edition Savings
Retention ToolAn attractive rate with the ultimate in flexibility.
Safe to UseLimited to maturing certificates only. No new deposits.
Compliant with RegulationIt is a simple savings account. 1.70%
As Interest Rates Rise Savers Have New Options
Financial Institutions Like Yours are Delivering Value to Depositors
in Many New Ways Including:
Better Savings Account Products
“Right-Sized” Early Withdrawal Penalties
Refinancing
Growing Properly-Priced Retail Deposits Today
https://thefinancialbrand.com/73678/banking-companion-deposit-account-cd-savings/
There is no guarantee that retail depositors will remain content as interest rates rise. To combat the potential of
attrition, banks and credit unions are using new approaches to attract, negotiate, and expand retail
relationships with properly-priced deposits.
New Deposits Accounts Deliver the Best of CDs and Savings
• Open and fund like a CD• High yield like a CD• Variable rate like a savings account• Withdraw any time, like a savings
account
Better Savings Account Product
The Companion Deposit Account
Similar to Limited Edition SavingsIt is a simple savings account.
Attract New MoneyCreate an offer that appeals to a potentially broader demographic than traditional stand-alone certificates.
1.80% Variable RateYou control the interest rate.
(Sample Results)
6,512,924.301,420,087.32
The Companion Deposit Account
Ideal New Relationships(Sample Results)
Early Withdrawal PenaltiesAre Not the Same Between Banks
https://www.bankofthewest.com/personal-banking/savings-accounts/cd/premium-mm-cd.html
Sample Penalty………
Have You Increased Your EWP?
Why increase Early Withdrawal Penalty?
Has it helped? What have been the benefits?
What does an effective EWP do? Protect the F.I.
Depositors hate penalties! Don’t you want more depositors? Why do something they hate???
Do what depositors like that is also good for you!!!
Depositors will Increasingly Check the Penalties
Offer “Right-Sizes Penalties” with CDtwo®
“Right-Sized Penalties” are determined on day of redemption and are never more
than conventional penalties for the bank. It is always better to use CDtwo®
“Right-Sized” Early Withdrawal Penalties
Which do you think depositors will choose if you bring this to their attention? $4,880 or $146 early withdrawal penalty?
http://www.bankps.com/Pages/CDtwoRedemptionPublic.aspx?userid=TSBank
“Right-Sized” Early Withdrawal Penalties
You can Protect Your F.I. while giving Depositors a Better Investment Option
100,000 – 99,854 = $146 Penalty Today
The Big Picture Opportunity
Every CD conversation should close with a conversation about the bigger picture.
Your people are hesitant to ask about other deposits.
Many Baby Boomers depositors have refinanced their mortgages many times over the years.
Now You Can Help Them Refinance Deposits!!!
GrowthMargin EnhancementRetention
APY
Creating an Effective Pricing Strategy
1
1 – Companion
GrowthMargin EnhancementRetention
APY
A More Effective 7-Stage Approach
21
APY
1 – Companion2 – Standard
GrowthMargin EnhancementRetention
A More Effective 7-Stage Approach
2
3
1
1 – Companion2 – Standard3 – Promotional Specials
GrowthMargin EnhancementRetention
APY
A More Effective 7-Stage Approach
2
3
4
1
1 – Companion2 – Standard3 – Promotional Specials4 – Customized5 – CDtwo
GrowthMargin EnhancementRetention
5
APY
A More Effective 7-Stage Approach
A More Effective 7-Stage Approach
APY
2
3
4
61
1 – Companion2 – Standard3 – Promotional Specials4 – Customized5 – CDtwo6 – Limited Edition7 – CD Refinance
GrowthMargin EnhancementRetention
5 7
Sequential Sales Process Opportunities• Companion Deposit Account – Be Relevant Again
• Standard CDs – Keep Interest Margins Healthy
• Promotional Specials – Focus on Getting Positive Attention
• Customized CDs – Offer the Ultimate in Flexibility of Term
• CDtwo® with “Right-Sized” Penalties – Present Better Options
• Limited Edition Savings – Reward Loyalty with Desired Liquidity
• CD Refinance – Be the Heroes who Deliver Windfalls
1 – Companion2 – Standard3 – Promotional Specials4 – Customized5 – CDtwo6 – Limited Edition7 – CD Refinance
GrowthMargin EnhancementRetention
Total Deposit Impact!
Financial Institutions using the suite of CoreCD® Package and Premium services
grew properly-priced retail deposits faster!
From what you observed today, Which of these statements apply?
• We could provide more flexible options for retail depositors.
• Depositors could better recognize that we are pricing competitively without over-emphasizing interest rates.
• The sales tools we saw are simple to understand and easy to use.
• I can see how depositors would appreciate the new things we saw today.
• I can see how our front line, especially the high-performers would really like this.
• I can see how Companion Deposit Accounts, “Right-sizing” early withdrawal penalties, and refinancing CDs of our competitors could help us grow much faster.
• The ability to make more profit is clearly connected to winning and retaining more properly-priced long-term deposits.
• We don’t want our competitors to get these tools first.
www.thecorepoint.com