The anatomy of a successful organic loan-growth strategy

first_img 5SHARESShareShareSharePrintMailGooglePinterestDiggRedditStumbleuponDeliciousBufferTumblr,Scott Butterfield Scott is the Principal of Your Credit Union Partner, PLLC.Your Credit Union Partner (YCUP) is a trusted advisor to the leaders of more than 100 credit unions located throughout … Web: www.yourcupartner.org Details Organic loan growth is a popular phrase these days. Today, an increasing number of credit unions are looking for ways to attract more loans directly. Direct loan growth (vs. indirect) can be more attractive, cutting out the middle man to improve yields, and leveraging direct member contact to increase cross-sells and higher products per member.Direct loan growth is easier said than doneOrganic loan growth can be difficult for credit unions operating in a competitive “red ocean.” W. Chan Kim and Renée Mauborgne of Blue Ocean Strategy argue that companies succeed by creating “blue oceans” of uncontested market space, as opposed to “red oceans,” where competitors fight for dominance – the analogy being that an ocean full of vicious competition turns red with blood. When it comes to consumer loans, credit unions operate in a very red ocean. Organic loan growth is difficult because literally everyone else is using the same product, pricing, promotion, criteria, process and delivery to attract the same group of people. The auto loan marketplace is crowded and cutthroat.To successfully achieve organic direct growth, you must do something different. We get to work with a lot of credit unions, and we hear (see) what works and what doesn’t. The purpose of this article is to share a best-practice organic loan-growth model to help your team find greater results. Setting the stageFive years ago, a mid-sized ($250-$500 million) credit union (let’s call it Best Practice CU) decided to shift its focus away from an indirect auto program. As stated above, Best Practice CU wanted to increase loan yields, and it wanted to interact more with new loan members to build deeper relationships. The credit union’s leadership believed that cross-selling results would be higher for direct versus indirect new loan members.Best Practice CU identified that prime and near-prime credit consumers who had existing auto loans would make for the ideal target. If you’re thinking this sounds like a common auto loan “recapture” program, read on.The credit union worked with its partner, Experian, to identify specific auto trades that had interest rates high enough to warrant an effective refinance offer. Common recapture programs frequently fall flat, because the promo rate offered is not that much lower than the consumers existing rate and because credit unions typically limit criteria to a static credit score range. Static credit scores, without trended data, can be tricky. I’d rather finance a “C” tier loan for someone with an improving profile than for someone with a deteriorating credit profile. Best Practice CU wanted to find prime borrowers who could have qualified for better rates at the time, but were just overcharged. It also wanted to find near-prime consumers who have improving credit profiles. The credit union used Experian’s Trended Data to find consumers with improving credit profiles. This allowed them to lend a little deeper, at higher rates, and better manage risk (i.e., profiles are improving). Next, Best Practice CU leveraged the interest rate data provided by Experian to customize rate offers to each target group. This way, the credit union only targeted people with rates high enough to result in a refinance offer. The data played a critical role: it increased offer acceptance, and Best Practice CU didn’t waste its time or money targeting people with low rates and less incentive to go through the refinance process.Best Practice CU went through many changes and adjustments, but it remained committed to the new process and used it monthly to find new consumers and recapture their auto loans.Finally, to support the regular target marketing, Best Practice CU utilized its Call Center to make outbound calls to follow up on the offers. The customized rate offer made the refinance opportunity more attractive for the consumer (e.g., the refinanced payment went down a lot), and that made it easier for the Call Center to close the deal – and to cross-sell other opportunities.Measuring successDuring the past five years, Best Practice CU has migrated nearly $50 million from indirect auto pool to a direct auto loan pool. That is a more profitable loan portfolio, and it represents new members who have more than one relationship at the credit union.“Experian’s Trended Data enables credit unions to identify members who are improving their financial situation by lowering their debt and paying on time.  Further, our interest rate data can then be used to help those members by offering better interest rates than they are currently paying,” said Paul Desaulniers, Senior Director – Trended Data, Scores & Collections at Experian.Why it mattersIf you want to consistently compete and win, you must do something different (and better).In this case, Best Practice CU took a run of the mill auto loan recapture process (such as the one so many credit unions are pursuing), and designed a better way. In the midst of a very red ocean of consumer auto lending, they found blue water.If like Best Practice CU, you want to do a better job with organic direct loan growth, I encourage you to consider the red ocean your team is currently swimming in. Invest the time to identify opportunities where you can more effectively compete. Invest the time and resources to build something successful. Don’t skimp on the technology, data, and human resources needed to create a best practice. Best practices are rarely “one and done.”last_img read more

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Robert P. Crowell

first_imgRobert P. Crowell, age 76 of Batesville, died Saturday, November 11, 2017 at Margaret Mary Health.  Born February 7, 1941 in Chicago, Illinois, he is the son of Ruth (Nee: Steele) and Cecil Crowell.  He married Linda Pactwa August 3, 1963 at St. Paul’s Church in Hammond, Indiana.  Bob taught Industrial Arts and Drafting for 33 years before retiring.  His first two years were at Sunman and his last 31 in Batesville.  He enjoyed working with young people.  He started the Coonhunters Junior Conservation Club, worked on many projects with students through the Rural Alliance for the Arts, coached the high school track and cross country teams for 10 years and had a program similar to Junior Achievement in which his students would create a business, manufacture a product and sell it to the public.Other interests included being a member of the Tri-County Harmonizers Barbara Shop Quartet, a former member of the Coonhunters small bore rifle team and re-furbishing and re-finishing antiques with Linda.  They also owned and operated the Safari Camp Ground for 16 years. Bob collect gas memorabilia and loved to collect and restore antique steam and gas engine tractors.  A member of the Pioneer Engineers Club of Rushville, he had articles published in 23 magazines on the subject.Another love of Bob’s was cars.  Over the years he owned several collectable cars and was a member of the Corvair Club of Indianapolis, the Corvair Club of Cincinnati, Vintage T-Bird Club of Indianapolis, the Ford Model T Club of America, the Ford Model T Club of Indianapolis, and the Hoosier Hills Car Club.Bob is survived by his wife Linda; daughter Patricia Crowell-Gentles of Lambertville, New Jersey; brother James Crowell of Valparaiso, Indiana as well as numerous nieces and nephews.  He is preceded in death by his parents.  Visitation is Wednesday, November 15th, from 4 – 7 p.m. at the Weigel Funeral Home.  Funeral services are 10 a.m. Thursday, November 16th, at the Batesville United Methodist Church with Rev. Chris Renick and Rev. Charles Flory officiating.  Burial will follow in the church cemetery.  The family requests memorials to Safe Passage.last_img read more

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Zidane set to offload four more Real Madrid stars

first_img Loading… Real Madrid boss Zinedine Zidane is set to continue his policy of selling squad players ahead of the 2020-21 La Liga campaign. Brahim Diaz has already joined Serie A side AC Milan on a season long loan, with James Rodriguez set to join Everton in the coming days. However, as per the front page of Saturday’s edition of Diario AS, Zidane is aiming to raise up to €100m by offloading Gareth Bale, Sergio Reguilon, Mariano Diaz and Borja Mayoral. Reguilon has been linked with a move to Premier League side Manchester United, after returning from a season long loan spell at Sevilla in 2019-20. Diaz has been lined up to join Benfica on a 12 month loan, with Mayoral previously linked with Valencia, after spending the last two seasons on loan at Levante.Advertisement Read Also: Real Madrid deny splashing €160m to sign Hazard from Chelsea Bale’s future remains the most complex issue for Zidane to resolve in the coming weeks, with his agent Jonathan Barnett to discuss the Welshman’s future with Florentino Perez next week. The 31-year old still has two years to run on his current contract at the Santiago Bernabeu, however, Los Blancos are rumoured to be edging closer to allowing him to leave on a free transfer. FacebookTwitterWhatsAppEmail分享 Promoted Content15 Photos Of Amazingly Beautiful MutationsBest & Worst Celebrity Endorsed Games Ever MadeThe Highest Paid Football Players In The WorldWho Is The Most Powerful Woman On Earth?7 Mesmerizing Facts About Hypnosis11 Most Immersive Game To Play On Your Table TopCouples Who Celebrated Their Union In A Unique, Unforgettable WayWhat Are The Most Delicious Foods Out There?The Funniest Prankster Grandma And Her Grandson6 Incredibly Strange Facts About Hurricanes8 Superfoods For Growing Hair Back And Stimulating Its Growth8 Weird Facts About Coffee That Will Surprise Youlast_img read more

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