May 2019

Why You Are Watching The Wrong Lending Competitors

Credit management - graphic of man looking through binoculars
CREDIT MANAGEMENT

No doubt, you hear all about how your competitors are winning deals because they are more aggressive when it comes to underwriting. While banks must always ask if they are taking the right risks and the right amount of risk, it is probably the competitors that you are not watching that is causing you the greatest risk. In this short article, we explore one often overlooked aspect of competitor surveillance and how this one technique can help protect your bank.

 

5 Reasons To Come To Our Bank Management Conference

Bank Management Conference
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. Hosted at the Ritz Carlton in Amelia Island, Florida, this is our flagship conference that gives banks the opportunity to meet our team, hear new ideas and to exchange thoughts with some of the best bankers in our industry.

 

The Hidden Risk in Commercial Lending

Managing credit risk - unexpected loss
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.  For commercial banks, it is the unexpected loss that is more important for lending decisions and long-term profitability.  We will outline how unexpected loss manifests itself in lending decisions and what commercial lenders must know to safeguard against unexpected loss for credit and interest rate risk.

 

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

More Accurate Commercial Real Estate Underwriting
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. However, since we see hundreds of underwriting packages a month from a variety of banks across the country, it is rare that we see banks, and even borrowers, adjust rents for new construction. In this article, we present our methodology, data, and adjustment factors that banks can use to have more accurate underwriting.

 

How To Get Better At Bank Email Notifications and Marketing

Bank Email Benchmarks
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. The work is starting to pay off. Email is one of the most effective forms of marketing we do, and the plan is to do more of it in the next year. In this article, we take a look at email marketing benchmarks in order to help your bank gauge your current level of effectiveness.

 

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

PROFITABLE BANK LENDING
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. However, there are three key elements that make debt especially appealing for borrowers. Commercial lenders that understand these three elements can better position themselves for success.

 

The Three Key Elements to Borrower

 

What Just Happened At Finovate Spring 2019

Bank Technology At Finovate 2019

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. This is speed dating for financial technology, and it is a fantastic way not only to look for new partners but to help your bank hone what is important to its vision. In this article, we recap the trends and highlight some companies that should be worth consideration by all banks.

 

Here Is What Other Banks Spend On Technology

BANK TECH SPENDING
BANK TECH SPENDING

One question we always ask is if we are spending enough on technology? After that question, we get confused and mired in the quicksand of financial reporting, finance philosophy and technology strategy. “Technology” is so pervasive that it is difficult to determine what the difference is between spending on “digital” projects versus “analog” projects. For instance, if we upgrade our phone system from dedicated copper to fiber optics that is an analog project but if we convert over to a slower voice-over-IP system is that a digital project?

Why Commercial Loan Prepayment Provisions Matter

Protecting Commercial Loan Profitability

In an article two weeks ago, we discussed why community banks should desire prepayment provisions in their loans.  We also acknowledged that in this very competitive banking market banks are unable to negotiate a meaningful prepayment provision.  In this blog, we will identify techniques that some banks may use to obtain a meaningful prepayment provision, and we share a video explaining how CenterState Bank lenders use these techniques with commercial borrowers to negotiate a powerful prepayment provision.