Hyatt Regency Orlando
9801 International Drive
Orlando, Florida 32819
Phone: 407-284 1234
“In just 60 days, they developed an action plan, with Roxanne’s help, to target large, low-cost deposit accounts. They used a team-selling approach with our lenders and landed $14 million in new deposits and five new accounts!“
— C. Holland, CEO
Farmers State Bank
Yes, the credit unions are suddenly paying substantial premiums. Yes, other banks are paying outrageous premiums as well. Those are things you can’t do a thing about.
The real problem is strategic—what worked before does not work now.
I’ve been talking to hundreds of CEOs about deposits for the last three years, and here are the three most common “solutions” to fixing the deposit problem. Do any of these sound familiar?
Unlike most banking courses and simulations that teach that advertising your rates in the local paper will solve your deposit problems, what actually happens is the creation of more problems.
Our lovable family dog, Murphy, may he rest in peace, had a few quirks. One day, as the family was about to sit down for a dinner, I put a fresh slab of butter on a butter dish in the middle of the table. I turned around to get the green beans to take them to the table. As I returned, I noticed the butter dish was clean as a bone—as if nothing had ever been on it. I started to wonder if I had beginning Alzheimer’s because I could have sworn I just put butter on the butter dish. Murphy didn’t make eye contact for about 10 minutes, but he did eventually lick his lips.
If that happened only once, I would have continued to wonder about myself. But soon the entire family came to know that if food went on the table without someone standing guard, the most innocent looking golden retriever, the same dog that never begged at the table, would stop making eye contact and eventually lick his lips—his signature move.
Clients have signature moves, too—those moves you can count on them doing every time, even though we act surprised when they happen.
The type of people who respond to a CD rate ad are also the kind of people who will not bring their entire relationship, and they’ll leave you at the drop of the next ad. That’s their signature move. It’s like dating an ax murderer thinking, “I can change him.”
So, you’ve only pushed back a problem—that your team still doesn’t have the right strategies and processes to attract low-cost deposits that stick. In fact, you’ve put your bank in a very dangerous place: a higher cost burden, with more risk of those deposits running out the door when you most need them.
The only thing that is more shocking than exec teams approaching the problem of deposits with the “solution” of adding incentives to lenders is their surprise a year later when it doesn’t work. It NEVER works.
Nobody seems to know why it doesn’t work. “The incentive program we created for our lenders made a dramatic difference”—said no bank CEO, ever!
I have a few theories on why it doesn’t work.
First, many of them don’t really understand deposit accounts, and it is embarrassing for lenders to ask when they are already at the top of the food chain and should know how things work.
Second, they don’t really want that relationship tied down, as their loan portfolio is often their security blanket. They want that portfolio to move with them if they go. So, they’ll nod their heads and occasionally give you a little bit—but they intentionally don’t aggressively seek deposits.
Third, there is an ego aspect. Many of the best lenders have a higher score in self-awareness on emotional intelligence assessments. Because being a lender has long been hailed as more prestigious than deposit positions, they won’t tell you that they think deposits are “beneath them”—it simply shows in the results.
Regardless, it just plain never works as a strategy to incent lenders to bring in deposits.
Who physically walks into a bank? Little old ladies with pictures of grandchildren? Yes. People who are new in town? Yes. Type A service business owners with large low-interest deposits? NEVER! Well, almost never.
Now look at how banks are structured. Lenders sit in the bank and occasionally go on calls—almost always to lists of businesses with, well…loans. Universal bankers are nestled into their comfy chairs waiting to open new accounts. Okay, that’s fine. We need somebody there.
Occasionally, branch managers are the folks who do the deposit calls. But they rarely have any education on how to work with the affluent who (spoiler alert) possess most of the deposits.
They don’t know what a 1031 exchange is and why that creates deposit opportunities. They don’t know whether to ask for a Schedule C or a K-1, so their only move is to say: “We’d sure like to earn your business. If you give us the last three month’s statements, we can see if we can save you some money.” Oh goodness. You’ve just trained your potential customer that price is what matters.
It’s not the managers’ fault. They don’t know how to add massive value, AND they have a branch to run. That is their priority, so they are set up to fail on these deposit calls.
Bottom line: Based on results, the current strategies don’t work and haven’t for some time.
When the horse is dead…dismount.
The banks that are going around town “stealing” million-dollar business checking accounts from their unsuspecting competitors are doing things VERY DIFFERENTLY…
It’s hard to lure a trout from a sand pile. Unfortunately, that misguided approach is what marketing and sales processes in most banks attempt to do. Without an understanding of who has the deposits and what those targeted people find valuable enough to switch, save your marketing dollars.
Almost no banks implement a psychographics and firmographics approach to finding their next best customers. Without that understanding and knowing how to target who has the large deposits, marketing departments spend hundreds of thousands doing “brand” advertising and “rate” advertising—two proven negative ROI investments.
If you are doing either…STOP. Your brand is what people in your community say about you and it NEVER comes from your advertising, so that is a waste. Unless you are a $20 billion organization, there is no value. Even worse, rate advertising is simply an announcement to your community that you are desperate and ineffective.
Those two approaches only work to pull in unprofitable customers IF they even do that.
“I’ve attended 24 years of high-performance networks and affiliations. They all have magic formulas and calculations to tell me how much more money I can bring to margins and profit. The missing ingredient was ‘how.’ We finally found an integrated system of both numbers and understanding with Roxanne Emmerich’s system. We have a real program that has translated to high energy and commitment for every single employee. It works!”
— R.L. Harmon, Jr., Chairman and CEO
Bank of Tennessee
My local de novo bank, in which I was a primary investor, sold a few years ago, and I was open to a new banking relationship. I called a local CEO I’d met at several banking conferences, someone I found to be a man of character, and asked him to send out one of his relationship bankers.
A lovely young woman, who couldn’t have been more caring and kind, stopped by. “If you’d like, please pull your last three months of statements and I can see if I can save you any money.”
My response shocked her. “I really don’t care if you can save me money, so that won’t be necessary.”
She was speechless and didn’t know what to do next—it was the only play in her playbook.
Like almost every banker out there today, she still plays the commodity it’s-all-about-price game. Not only do most bankers not know how to get themselves out of that game, sadly, they often initiate it, like she did.
Most savvy business owners know that there are so many risks and challenges to a business today that a bank could and should bring value regarding that. Discussing how you can save someone a few hundred or even thousand dollars, compared to how to save them hundreds of thousands, shows how out of step most bankers are with the needs of small business owners.
“Our focus on the sales process has led to growth in our core deposits, adding significant value to our organization in the long run. Twenty-six of our twenty-nine banks are in excess of their target levels.”
— M. Scheopner, CEO and President
Landmark National Bank
You’ve probably heard the expression that you can’t win a gun fight with a knife. Well… you can’t pull in 7-figure non-interest-bearing deposit accounts with a “we’d love to earn your business” comment.
Instead, you need to bring the sophistication to earn their business. You must bring the extreme value that far exceeds the difference between what the incumbent bank offers before you earn the right to ask for the business.
Let’s face it. Is returning phone calls quickly justification for a 7-figure checking account move? No. It’s to be expected.
Is staying in touch regularly worth premium pricing and the pain of switching? No. Again, that must be expected to even be in the game.
Now you know “what to do” to fix the deposit problem. The trick is knowing “how to do it”—and how to do it fast, before the bank down the street figures it out.
Will a recession come? Of course it will. Recessions always follow expansions. And when it comes, the bank in your market with a solid foundation of low-cost core deposits will be positioned to thrive. Banks that don’t get their deposit situation fixed now will be forced to change the signs out front and put someone else’s name up there.
In the last recession, we saw close to half of the 16,000 banks in the U.S. disappear or get gobbled up. Will it be that bad in the next recession? Probably not. But by 2022 (in just two years), it’s projected that we’ll lose another 2,000+ banks. The difference between those that go “poof” in the new age of Google checking accounts and those that systematically pull in low-cost commercial accounts will be dramatic.
We’ve worked with over 300 banks during the last 30 years. Those banks that have implemented the deposit blueprint we’ll be sharing with you at the Deposit Mastery Summit have results that speak for themselves:
I want you to consider for a moment what’s possible for you. At this point in history, there’s both real danger and enormous opportunity.
“In 2015, we increased average non-interest-bearing deposits by 23.7%. In 2016, we increased them by 31.5%. And in 2017, we increased average non-interest-bearing deposits by 38.2%”
— L. Harrison, President and CEO
Virginia Partners Bank / Maryland Partners Bank
This is a unique opportunity to get away from your bank, get exposed to the best ideas in the industry, and strategize with your top leaders, so you hit the ground running in 2020.
“We not only met EVERY goal in ALL our branches, but we exceeded many of our goals by 100 percent! Our entire organization acts like a team! I can’t imagine any CEO who wouldn’t want this.”
— C. Hoffman, President and CEO
2015 Extraordinary Bank of the Year Award Winner
“The real progress on the margin is on the deposit side. We have the second lowest cost of funds of any community bank in Utah. And even though rates have moved up, we’ve managed to keep customers.”
— J. Jones, President and CEO
First National Bank of Layton
Every one of the top 100 banks in America shares two common traits: paranoia and humility. They’re always a little paranoid that someone’s going to come along and eat their lunch. That’s what keeps them sharp. And they’re humble…they’re always looking to gain the next slight edge that will keep them in the driver’s seat in their markets.
That’s exactly the problem. We routinely work closely with banks with $7-9 million in assets per employee. They’re never “too busy.” In fact, go inside their banks and everything’s calm and orderly. They’re just productive! When we go inside banks with $2-3 million in assets per employee, there’s a fire to put out every hour, on the hour. Your choice…do you want to be a firefighter or an elite banker?
The regulators are coming!…
We’re rolling out a new Core!…
My kid’s got a soccer game!…
Yep, I get it, life happens, regulators come, new software has to get rolled out…and on and on and on…
If not now, when will you make time for core deposit growth? For profit? For finally getting your bank to the level of performance you believe possible? There will always be [fill in the blank] that’s “in the way” and has you “tied up.” The choice you have is simple. Allow those things to rob you of this opportunity to get the ideas and strategies to have a much brighter tomorrow, or say: “I’m going to figure out core deposit growth. The regulators, the core upgrade, the whatever, will be here when I get back.” It’s just 2 days.
This is a one-time conference ONLY FOR CEOs, SENIOR EXECUTIVES, AND BOARD MEMBERS of community banks to learn and share what’s working right now to land large, low-cost core deposits.
Change your schedule. Get here. You won’t regret it.
Simple. You get your money back.
or CALL (952) 737-6730