Tag: Big Data

Pete Carroll Needs A Data Guy, Better Respect For Statistics Or A Puppy

Bank Risk Management

We were underwhelmed by the creativity of last night’s Super Bowl commercials, but it makes sense that Budweiser’s top rated commercial took first place. While it was basically the same ad as last year, the data shows that if you put a puppy in an ad, the odds of success go way up. Further, if you put that puppy in peril and then have a cross-species rescue, what could be cuter?  Budweiser played the odds and garnered 45 million views and the top ranked ad spot while Pete Carroll, well, did the opposite.

 

What Your Loan Pipeline Data Is Telling Your Bank

Loan Pipeline Data

If you’re a bank that keeps a loan pipeline report, chances are you have some excellent data that will form the basis of making your bank more efficient. The column chart below is one bank’s data where we looked at all the loans that made the pipeline report and then looked at the percentage approved and compared it to those loans that fell out either due to losing the loan to another institution (40% of the fallout), withdrawn/tabled by the borrower (32%), declination (14%), insufficient information (10%) or other (4%).

 

Adjusting Your Bank’s Branch Marketing Model

Bank Marketing with Data

Many banks talk about delivering a targeted local approach, but end up spending their marketing budget to garner a mass appeal. Nine times out of ten, this is a mistake and by utilizing a different approach, banks can be more efficient in their marketing dollars. As usual, solving this marketing problem is a function of asking the right questions. The question is not “How does the bank acquire more customers,” but “How does the bank acquire the right customers.” This means that first you have to understand who the right customer is.

A Commercial Loan Metric That Will Help Your Bank See The Future

Commercial Lending Risk Management

If you listen to the news pundits, there is lots of talk about asset bubbles. To figure out if banks are lending into inflated asset prices we turn to the data for answers. Since valuation is a function of future cash flow, having a more accurate vision of the future is helpful when lending. Once predictive factor to alert commercial real estate lenders is when supply outstrips demand by more than a 2-to-1 ratio. When this occurs there is better than a 60% chance that cash flow remains flat or even goes down, thereby hurting property values.

Why Data Matters In Bank Lending - A Live Example

Banking and Data

You can ignore data when underwriting, but that would be a mistake as sometimes the differences are stark. Our best example comes from fresh data from the office supply sector. Normally, industry probabilities of defaults (“POD”) move by about 7% per year. In 2014 certain industries, like banks and retail office supply stores, moved with large rates of change and even multiple rates of change. While banks are moving in a positive direction and risk is being reduced, retail office supplies are moving in the opposite direction.

What Factors Drive Both Revenue AND Satisfaction in Banking

Bank Service and Revenue Heat Map

Yesterday’s blog on how little branch hours are correlated to revenue and customer satisfaction elicited a healthy dose of responses. If branch hours nutted some bankers up, just wait for the rest of today’s post, as this might really short circuit some guarded beliefs. The picture below is from our data and research and is a heat map of some selected factors and how revenue and satisfaction are dependent on those factors.

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