ABA Banking Journal - February 2008 - (Page 26)

Community Banking you want more of?” It is obvious that community banks should have the strategy to be core deposit driven by creating more relationships. This is traditional, profitable banking, and it creates the highest future share value. Besides, going after core deposits is far more enjoyable than dealing with loan problems! Banks with problems are probably not taking care of their best customers and are probably too tied up to go after new customers. So this is a great time to build core deposits. (See feature on depositgathering strategies on page 38.) It is essential that your product line, delivery systems, front line people, and sales teams be up for the challenge. As we mentioned, it is also a time when you can invest some money in technology, people, and training. Community banks should have the “best” to increase the odds of capturing core deposits. Unfortunately, many front line staff do not have a firm understanding of why core deposits are desired—for example, why opening a checking account is far better than a CD. And management’s response is often to introduce a “sales culture” to enhance performance. We’ve learned that staff need to be trained to help customers make decisions that are beneficial to them, and ultimately, build the relationship. All too often frontline issues go undetected by senior management. Advising customers to take out a CD versus opening a money market account, not intro- ducing themselves, or listing service fees instead of benefits are a detriment to your bottom line. We’ve even been privy to mystery shopping results where a CSR told a business prospect that “there are lots of bigger banks in the area if they didn’t have what he needed.” It’s crucial to train well, ensure consistency, and check in often. As for the loan officers, they are often looked to as business development officers and are expected to bring in business core deposits. This is also a misstep we see repeatedly. Loan officers tend to be in contact with businesses that need money. It is more important to go after businesses that have money and don’t need loans. And finally, don’t forget benchmarks. 26 FEBRUARY 2008/ABA BANKING JOURNAL http://captiveindoormedia.com http://captiveindoormedia.com

Table of Contents Feed for the Digital Edition of ABA Banking Journal - February 2008

ABA Banking Journal - February 2008 Contents On ABABJ.COM: Have You Visited Our Brand-New Website? Editor's Column "That's Edutainment" Snapshot: Tier 1 Ratios Stable so Far 100th Anniversary: Then and Now ABA Resources ABA Chairman's Position Don't Despair Pass the Aspirin Cover Story: Socially Responsible Banking Profitably - Incoming America's Community Bankers Council Chairwoman, Dorothy Bridges Demonstrates the Way A True "Rags-to-Banker" Story Retail Banking: On the Money Hunt Community Bank Management: The Ugly Truth About Board Relations Does Core Really Matter? Security 2.0: Not Just a New Kettle of Phish A Personal Case of Mal-Serendipity DOD Credit Regs Demand Attention Mailbox Banker's Mart To Advertise/Index of Advertisers The Economy

ABA Banking Journal - February 2008

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