In our quest to add more value to our customers, one of the ideas we hit upon was to train relationship managers up to handle the complexities of ESOP lending. Instead of lending to a corporate client, it is more profitable and less risky to lend to the ESOP of that client. Further, few bankers take the time to understand how an ESOP works so competition is limited. Banks can go after existing ESOPs and help refinance their current debt, can work with existing clients to establish ESOPs, or can go after perspective commercial customers and help them establish an ESOP.
Of all the top performing banks, the one that we are most envious of and follow the most closely is Live Oak Bank. Chip Mahan and his team of high performers have reverse engineered the best parts of banking. The result is a radically altered business model that achieves performance through its simplicity – profitable products to profitable customers.
Go to Peapack-Gladstone Bank’s (PGB) website and you see something that you find at very few banks. Actually, it is what you don’t find. You don’t find a page full of products. Instead you find information about the bank, what they think and about their philosophy. Their products are under the heading “How We Can Help” where they talk about “Solutions” instead of products. Throughout the site you find a bank trying to make an emotional connection with their client.
Below you will find a link to Season 1, Episode 2 of our new podcast. You should go to iTunes and subscribe as podcasting is our latest experiment and this is really our intro episode that explains why we podcast and more importantly answers a question that we get asked all the time – why we share our data, policies, products, and thoughts with other banks. We also answer the question why we did an intro episode as our second show, instead of our first. We also set up our objectives for the first season.
Ahh, the gentle breeze of Havana – the music, the people, the cigars, the mojitos and the embargo. Given the thawing relations and the new rules announced by the Obama administration, banking and financial transactions are now loosening….somewhat. While the lifting of the embargo will take an act of Congress and is not expected to be reviewed until next year, American companies are already in motion in preparation.