Financial institutions of all sizes have been vying for deposits following the bank collapses earlier this year. Even today, things remain on the move.
Since the end of May, deposits at large financial institutions have fallen while deposits at smaller and regional financial institutions have increased. The four biggest banks in the U.S. by asset size gave up $262 billion in deposits when compared to the year before.
In contrast, many community and regional financial institutions are continuing to win back deposits. It’s the strong community ties and trust-backed relationships that have allowed depositors to remain calm and retain confidence in their community financial institutions. But many community and regional financial institutions are still on the hunt for deposits and are willing to pay aggressive deposit rates across products.
Thinking about building a full strategy for determining rates and launching new products can be intimidating. We’ve thought through some tips, tricks, and considerations to ease the process and capture the up-for-grabs deposits.
New products open the door to capture deposits and connect with customers and members. Choosing the right type of product to offer requires thinking through risk, strategy, and market fit.
In the time since the bank failures, consumers have gotten less worried about further potential failures and shifted attention to ensuring that their deposits were generating the maximum yield.
This has left many consumers looking to money-market funds and CD products. Inflows to money-market funds are now at levels that haven’t been seen since 2020.
A locally owned and managed $2 billion bank based out of the Midwest recently grew deposits by leveraging a rate-driven strategy with a multi-channel marketing campaign.
The bank launched a 5% interest rate savings account and a 5.5% 13-month CD to attract new deposits.
The bank leveraged a variety of marketing channels to ensure that the product got maximum visibility. The bank leveraged both traditional and digital channels to promote the product, using email and promotions on frequented financial websites to cover the digital marketing strategy. As for traditional marketing channels, the bank turned to direct mail and print advertisement. A key thing that the bank considered was choosing specific channels catered to their target demographics – for example, choosing a newspaper advertisement to reach a traditionally older demographic.
In less than 30 days of product promotion, the bank received more than 1,000 applicants and over $35 million in new deposits.
Many digital account opening vendors have a traditional process for adding and updating product offerings. These processes include liaising with vendors to get things updated, often taking up to several weeks. This can hinder your ability to maximize on things like the latest rate, or an untapped CD strategy. At Narmi, we built a tool to ensure our financial institutions can make additions and updates in real-time.
Narmi’s Product List Manager gives financial institutions full control over this process, creating a seamless user experience for staff and allowing financial institutions to capitalize on shifting deposits.
As deposits continue to remain up for grabs, Narmi’s Product List Manager empowers financial institutions to operate more efficiently while also offering the most appealing products and rates.