Western Independent Banker - January/February 2009 - (Page 20)

• Redeploying from low potential markets to fund more productive expansion. The resources to pay for marketing and greater market density can be made available by exiting underachieving locations and markets that are absorbing a disproportionate level of spending. Short-Term Actions to Build Deposits Picking up on these keys, the following actions can help banks grow deposits short and long term: 1. Determine where the bank stands in terms of market share across all products by focusing on deposits. It is a straightforward proposition to understand the bank’s current customer segments, and it does not take significant work to identify the segments that populate the bank’s trade area and their propensity to acquire bank services. 2. Ascertain the causes of gaps found in the market share analysis. The obvious sources of problems are: (a) a lack of adequate advertising, promotion, and direct marketing initiatives and (b) the absence of scale (and visibility) in some markets. Primary customer and prospect research may be necessary to understand why the bank is not topof-mind when a prospect is making a buying decision or—if it was considered—why it did not capture the customer’s business. 3. The insights from primary and secondary research efforts should form the basis for a series of concrete actions to address deposit shortfalls. The most common outcome is a series of decisions to: (a) increase spending on new products; (b) add quality sales personnel; and (c) utilize a fuller array of advertising and promotion to achieve new sales targets for new business. These should be based on market potential rather than the mere act of adding a percentage to last year’s actual results. 4. Do not reward account-churning sales tactics. Set targets and remuneration based on net new business only. If the bank is not setting sales targets and rewarding the acquisition of net new business, the source of deposit growth shortfalls has been discovered. 5. Use insights about market potential to rethink branching strategies and tactics with a clear eye toward existing markets where the bank cannot be successful given its current position and capacity for further investment. Redeploy scarce resources to higher potential opportunities. These are just a few of the practical steps that smaller financial institutions can take to organically grow their core deposits, a critical task in these economic times. Mack Wood is vice president and general manager of Metavante Consulting and Professional Services. He can be reached at mack.wood@metavante.com. Everyone wins when we work together. We were made for times like these. We were founded by bankers to oﬀer a comprehensive insurance solution for ﬁnancial institutions. BancInsure’s commitment to community banks has been unswerving —even as other insurers reduced their exposure to this market. Peace of mind when you need it most. With an unmatched reinsurance portfolio, an industry leading 25% market share and an A- (Excellent) rating with a stable outlook from A.M. Best; you can count on BancInsure to be there for your bank when you need us most. Take a closer look at BancInsure. 5005 North Lincoln Boulevard Oklahoma City, Oklahoma 73105 800.682.1630 BancInsure.com Ask your Independent Agent about BancInsure; visit us on the web at BancInsure.com or call us at 800.682.1630 to learn more about what BancInsure can do for your bank. Change is coming. BancInsure is ready. 20 www.wib.org Western Independent Banker http://www.bancinsure.com http://www.clickrsvp.com http://www.wib.org

Table of Contents Feed for the Digital Edition of Western Independent Banker - January/February 2009

Western Independent Banker - January/February 2009 Contents A Message from the President & CEO Managin Liquidity and Funding During a Recession Staying Liquid in a Time of Regulatory Sea Change Managing Liquidity in a Volatile Rate Environment Regulatory Outlook for Brokered Deposits Deposit Growth and Branch Network Effectiveness Turbo Charging Account Acquisitions FDIC-Insured Sweep Accounts Creating a Contingency Funding Plan WIB Service Corporation Report WIB Calendar New Members Index of Advertisers advertiser.com

Western Independent Banker - January/February 2009

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