If there is any point in the loan process that is the most critical it is the presentation of the term sheet. If done right, the term sheet ends up closing a profitable loan and if done wrong, it generates more questions and begs to be negotiated. One feature that we have found advantageous to the process is the inclusion of multiple options in loan structuring.
You have probably received an email from a spammer and thought “Why can’t these guys use spell check?” Or in similar vein, if everyone knows about the Nigerian Prince email scam in this day and age, why still say you are a Nigerian Prince? The immediate assumption is that the sender is moronic, a foreigner or careless. The ironic part is that the exact opposite is true and the move shows a bit of brilliance that every banker should employ.
The Math of the Scam
As of yesterday, general registration for the .BANK web domain extensions opened and an estimated 4,000 domains were applied for. Approved by ICANN in 2008, financial organizations and trade associations banded together to establish an fTLD Registry Services, an entity that would control these “financial top level domains” (fTLDs). Open on a limited basis since May, yesterday was the first day any bank could apply. What ensued was the greatest land grab by banks in the history of the industry and it was all anyone talked about yesterday.
When it comes to commercial customer service, next to execution, there is nothing better to garner satisfaction than becoming a trusted financial advisor. As community bank relationship managers, we can be the foremost trusted advisors to our commercial customers. Given that we have seen multiple business and real estate cycles for hundreds of customers, and experienced banker possess the knowledge, insight and the ability to analyze a specific financial situation to then offer prudent, customized advice.
Last week we ran a blog with the concept on an idea for a new relationship account and a New Year’s countdown promotion to go with it (HERE). In response, many bankers asked our ideas for a summer promotion to gain new customers.
Chances are your bank has a “pipeline report.” This is a report that details all the qualified prospects, their potential transactions, their value and where they are in the sales process. If your bank is on top of its sales game, it likely has this report by customer relationship so that loans, deposits and services are all on one report and can be managed. If your bank is more traditional, then it likely has multiple reports for loans, deposits and maybe, fees. If your bank doesn’t believe in relationship banking, then maybe you just have this report for loans.
Ahh, Summer – the taste of watermelon, the smell of BBQ and the struggle to keep from getting an iPhone-tan line as we text from the pool. We have been waiting all winter to start complaining about the summer heat and now we get our chance. Regardless of what you have planned for the dog days of summer, the season is also the time to start planning your winter account promotions.
Who fits the "bill" for the new ten? In case the US Treasury asks, we are ready...
We need your help on this one. If you have a pen and paper, keep it handy as we will ask you to write down one number related to your bank. First, let’s define the concept. In statistics, the correlation coefficient is a measure of the linear dependence between two variables X and Y, with a value that ranges between +1 and −1 inclusive. A correlation of 1 is perfect positive correlation, 0 is no correlation, and −1 is a perfect negative correlation. This concept is widely used as a measure of the degree of linear dependence between two variables.
If truth be told, banks think very little on where to set their commercial loan maturities. That could be a mistake as setting maturity not only impacts credit and liquidity risk, but also has a significant impact on profitability. Today, we will step through two different loan structures to demonstrate the difference in both credit risk and risk-adjusted return. By understanding the finer points of setting future loan maturities, banks can improve performance.
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