Correspondent Blog

In 1963, American Express rolled out an initiative of embossing “Member Since xxxx” on its credit cards and marketing material to signify customer loyalty, relationship longevity, and prestige of brand. Several other banks, including Wells Fargo, have followed suit with similar success. A member tenure program signals recognition, belonging, and continuity. In this article, we…

In a perfect world, when it comes to pricing commercial loans, banks would price customer relationships based on risk-adjusted return on capital (RAROC) and incorporate shareholder value-added (SVA). Banks would then measure profitability at the customer, product, branch, region, or manager level so that management may properly allocate resources to drive institutional profitability. Banks would…

Like a carpenter with a hammer where everything looks like a nail, to a deposit gather, all too often the world looks like a rate. Commonly lost is a discussion around marketing expense. In this article, we explore a deposit marketing framework that describes how bankers might want to think of the trade off between…

When it comes to winning loans for commercial relationships, community bankers need to know who they are competing against. Understanding your competition allows you to better innovate your products, define your delivery channels, highlight your differentiation, and establish pricing methods (among other business strategies).  Bank managers often believe that they can differentiate their service to…

Many bankers use gen AI as a search engine. Others use it to help them write or come up with ideas. Still others are more sophisticated and have started to incorporate multiple AI models into the enterprise to leverage AI across the bank. All this helps, but one execution that we found the most helpful…

In our previous article (HERE), we explained that fee income (not net interest margin, asset size, or nine other variables) has the highest correlation to community bank performance as measured by both return on assets and equity. Growing fee income is one of the most critical investments you can make. Why? We believe that this…

Many banks either fail to innovate or innovate to their detriment. Artificial intelligence and tokenization are two current examples where either banks are ignoring or in an attempt to innovate have destroyed the value of the product by copying old processes, putting enough guardrails on to limit its use or being so slow to roll…

Annually we study community banks’ performance to investigate which financial variables correlate to Bank ROA. We then explain that correlative relationship using further studies, analysis, and industry observations. We use average five-year ROA and measure the correlation coefficient (R2) for various financial variables. Over the years the relationship between NIM and ROA has been remarkably…

When it comes to deposit gathering, the first quarter of any year is critical. If you need deposits and don’t have an active tax refund deposit effort every year, then you are missing out on one of the most effective deposit gathering tactics in banking. Tax refunds are just starting to hit this week and…

We talk to thousands of lenders across the country each month about structuring and pricing loans.  We have never fielded so many questions and debates surrounding pricing differential between fixed versus floating-rate loans.  We believe that this development is primarily driven by the uncertainty of the future path of interest rates (a perennial issue for…

This month will likely go down as the “Agentic Big Bang.” The artificial intelligence landscape shifted from “chatting” to mainstream “doing,” and if you are running a community bank in the US, the ground beneath your feet just moved. Over the last two weeks, we had four seminal events – Openclaw exploded, Anthropic released Claude…

To be a better trusted advisor to your commercial borrowers, one important topic is interest rates in 2026. We recently wrote an article about how the Federal Reserve’s next interest rate move may be up and not down (here).  The aim of that article was not to take a alternative view for contrarian-sake but to…