Tuesday, April 20, 2021 - 3:00 - 4:00 PM Central
Is your financial institution stuck with high-cost CDs on your books? You might have more options than you think!
As part of our Series of Solutions, FHLB Des Moines has partnered with The CorePoint to bring you this hour-long webinar hosted by The CorePoint Founder and CEO, Neil Stanley. During the webinar, Neil will share how some financial institutions have found a unique strategy to improve their net interest margin by providing their depositors with a reward option for early redemption of their time deposits. This endeavor is especially advantageous given the U.S. Fed's recent decision to let bank-leverage exemption expire this month.
The median industry time deposit portfolio cost reported as of December 2020 was 1.28 percent. However, FHLB Des Moines advance rates typically hover between the .30 percent to .94 percent range for terms up to about 4-years. Many financial institutions are booking new and renewed time deposits around .30 percent to .40 percent. These disparities have been a material drag on net interest margins for financial institutions that have better funding options in place.
Financial institutions looking for lower cost of funds have materially improved profits and the depositors who want access to their money sooner have received their wish along with some “bonus” interest. While depositors may pass on the option, they are impressed that their financial institution presents them options that are above and beyond the terms of the deal they accepted back when they opened the accounts before the pandemic began. Talk about a great win-win opportunity!
Neil recently penned an article for BAI sharing how financial institutions were thriving using an Early Withdrawal campaign. You can read the article here.
This webinar is for financial institution representatives that:
- Are looking to promptly lower their cost of funds to prevent net interest margin compression
- Offered rates of interest a year ago that they would like to see roll off sooner than scheduled
- Want to display to their customer base that they are financially strong
- Want to give depositors more reasons to see them as their preferred financial institution
We hope you and your team are able to join us to explore the Early Withdrawal option and its possible benefits for your institution.
Continuing Professional Education (CPE) credit will be available for this webinar. Scroll to the bottom of the page for more details.