Correspondent Blog

If you want to get ahead of a trend, consider investing in content for your bank. Content is the new growth accelerator in banking and banks would be wise to start small now, experiment, and learn the ways of the future. Content is the missing piece of growth acceleration and helps not only acquire new…

Research demonstrates that many companies do not sell their products or services evenly throughout the week, month, quarter, or year. Instead, in many industries, revenue and profit margins can fluctuate substantially throughout periods. It pays for community banks to not pay attention to this phenomenon in order to increase margins, but due to the vaccine,…

Credit is always changing, and CenterState watches a variety of markers such as corporate bond credit spreads, vacancy rates, net effective rents and many others in order to help us understand credit. Three of those important credit metrics are the probability of default (POD) by industry, the rate of change of that POD, and the…

As shown in the graph below, we may be witnessing the end of a multi-decade bull run in bonds.  After many decades of decline, interest rates may be on the rise for years to come.  This development is creating an opportunity for community banks to book longer-term fixed-rate loans with higher profit margins.  However, borrower…

Of all the lending programs in banking history, the Paycheck Protection Program (PPP) has to be one of the most complicated ever to enthrall bankers. Consider that in the next couple of weeks, banks will be:  originating the second draw of PPP (PPP2) under new guidelines; originating PPP loans under the initial set of guidelines…

A credit tenant loan (CTL) is a loan secured by the real estate pledged as collateral and the obligation of a credit-rated tenant of that real estate.  These loans are a cross between a bond (because the tenant’s obligation to pay rent is a senior obligation of a creditworthy obligor) and a commercial mortgage (because…

The new split bipartisan Covid Relief Bill got traction yesterday and stands a good chance of getting approved in the next couple of weeks. Most versions of a new stimulus package contain the approval for the next draw of the Paycheck Protection Program (PPP). The SBA, in turn, is preparing to bring the program live…

With FDA approval and the first shipments of the COVID-19 vaccine start to hit our communities this week, the question comes up over should banks have a policy around if the vaccine should be mandated, recommended, supported, and acknowledged in the workplace?  On the one hand, taking a proactive stance supporting workplace vaccination could be…

We recently spoke to a frustrated banker who was amazed that a regional bank was trying to poach his existing customer by quoting the borrower a credit spread of 1.65%. At such a thin credit spread, how would any bank make a profit, and why was this regional bank so irrational?  In this blog, we…

Now that Thanksgiving is behind us we can turn our attention to the holidays. That means our annual gift guide for bankers. We do this as we not only have a good time putting this together, but it is one of the pieces of content that we produce that drives heavy traffic. At this time,…

On October 23, 2020, the International Swaps and Derivatives Association (ISDA) published the Fallback Protocol (Protocol) that allows firms that use LIBOR to transition to SOFR when LIBOR becomes unavailable.  On November 30, 2020, ISDA and IBA announced that it will cease publication of the one-week and two-month US dollar LIBOR settings immediately following the…

In a recent training, the recording of which is below, our Bank participated in an intro class on how to get better at remote selling and coaching put on by Jack Hubbard of St. Meyer & Hubbard. Given the pandemic and the fact that we believe remote selling is here to stay, we found it was…