Legends in Lending. Success Stories Shared.

Transcription

1 Legends in Lending. Success Stories Shared. Panelists: Hilary Reed, Bucks First FCU Lisa Totaro, Sunmark FCU Alison Wolf, FAA CU Kristen Mashburn, Listerhill CU Brian Griffith, Gesa CU

2 Hilary Reed VP/Marketing Bucks First FCU $85 Million

3 What: Bucks First FCU 2012 Loan Growth: 10.1% Increase in Auto Loans 10.6% Increase in Home Equity Loans How: Refinance, Refinance, Refinance! With the fluctuations in the economy over the past few years, consumers are constantly looking for ways to put more money in their pockets. Educating members about their refinance options can increase your loan share of wallet, your bottom line, and deepen your member relationships.

4 Auto Refinance 9 out of 10 consumers arrange financing at the time of purchase, through the dealership. If you don t have an indirect program (or someone dedicated to cultivating indirect relationships with dealers), only a percentage of your members will think of you FIRST when buying a car. 45% of Credit Union members have a new or used auto loan. Only a little over half of those members have their loan with your credit union. The alternative to getting their FIRST auto loan, is getting their NEXT. Target members/consumers who have recently purchased a vehicle and financed it elsewhere Offer them something better. (i.e. better rate, lower payment, rebate, cash, etc) Close the deal and cultivate this new relationship The offer can make or break your success A flimsy offer will end up in the trash can with all of the other credit offers your members receive. Make it known that We know you re cheating on us (Maybe not in those words). Tell them that you want them back, and prove it with your offer.

5 Auto Refinance Auto Recapture Program Targeted members with pre-qualified credit criteria who have Recently purchased a vehicle Financed the vehicle elsewhere Sent bi-monthly offer letters Offered to drop their current rate by 1.00% Maintained an appropriate floor rate - approved by ALM Included an expiration of offer to create sense of urgency Sent follow up postcard reminding them of the offer before expiration Ongoing follow up phone calls to targeted members Benefits of Auto Recapture Programs Increased share of wallet They are already members of your credit union Capture the business they have elsewhere Deepen the relationship with your member Low Interest Rate Risk As long as ALM is involved and floor rate is set Low Credit Risk You set the pre-screen qualifications Only mail to acceptable credit scores to ensure candidates are credit-qualified Do not mail to delinquent members, members with collections, bankruptcy, or limited credit history

6 Auto Refinance Annual Drop Your Rate Refinance Promotion Run promotion every summer year for 6 years Refinance your auto loan with us and we ll drop current your rate by 2.00% If you qualify for the loan, you get the 2% rate drop not tiered Loan to value must meet criteria Use mailing lists that tell us which members purchased a vehicle elsewhere Focus on lower credit tier individuals You will always get rate chasers with A+ credit Targeting lower credit tier individuals will allow for higher interest margins Staff contacts members who have withdrawn auto loan applications If we lost the first opportunity for ANY reason, now is the chance to get them back Shows them that we care, and we remember Benefits of Drop Your Rate Promotion We still maintain a good interest margin Bring in millions in used auto loan balances every year Members come to expect from year to year Has a word-of-mouth, viral effect The discount not being tiered gives lower credit tier individuals the opportunity to get a better rate, pay less interest, and creates loyalty to the Credit Union

7 Home Equity Mortgage Refinance Consumers are now beginning to recover from the housing downturn. Believe it or not, some people DO have equity in their homes In 2012, some 1.7 million consumers who were previously underwater on their home loans, were able to bring them right side up, creating positive equity in their mortgages. Home prices are expected to continue to rise through 2013 Focus on what you do best. Create a niche. Your product cannot be all things to all people. Not everyone will want your home loan product, or qualify for it. Find the niche in your marketplace. Make your product fit your target audience and vice versa. Know your target audience for your product New home? First time home buyers? Baby Boomers with equity? Why are you targeting this segment? Know the answer to this before you begin. Are you trying to get blood from a stone? Is your market over-saturated with lenders? Focus, focus, focus. Know who you want. Know when you want them. Know how much you want from them. Know what you re going to do for them.

8 Home Equity Mortgage Refinance Created a Niche Home Loan Product Pay Off Your Home in 5 Years Home Equity Loan Closed End, Fixed Rates 5 year as low as 2.25% APR 10 year as low as 3.24% APR Must have a minimum 60% LTV (40% Equity) Bucks First FCU must be in 1 st lien position No closing costs No application fee for loans of $25,000+ Called it a Home Loan so that those individuals with a current mortgage will consider Refinancing into this product.

9 Home Equity Mortgage Refinance Targeted Marketing to Various Consumer Segments Targeted members and non-members Non-members within 5 mile radius of branches Current mortgage in good standing $80,000+ of equity in the home Length of residence 15+ yrs Ages Members with 40%+ equity in their home (Raddon demographic data) Members with a current Bucks First FCU Home Equity Line of Credit Allowed members to refinance from a variable rate line of credit into fixed rate, shorter term, first lien home loan Mailed a separate letter from those who received standard postcard Members with Checking Accounts Checking balances of $1.00 or greater Recurring monthly bank ACH debit of $800+ Ages No Bucks First FCU Home Equity or HELOC Targeted Onboarding Include direct mail piece for this product in ongoing onboarding/matrix mailings All new households ages Low participation Households (Single Service Members for 6+ months) Older upscale, Middle Income Depositor, Middle Market Consumer Segments only (As defined by Raddon)

10 Home Equity Mortgage Refinance Targeted Delivery Channel Mix (Ongoing) Banner ad placements on local websites targeted to Bucks County residents based on recent web behaviors surrounding finance & homes Yahoo Behavioral Targeting advertisements Keyword and content targeting for SEO Demographically targeted online banking web banners Objectives April 2012 $2,000,000 in new product balances in first 12 months $66,000 average loan balance per household 30 loans Increase Home Equity Loan HH Share of Wallet from 45.7% to 46.2% Results April 2013 $8,667,000 in new product balances in first 12 months - 433% of objective $68,700 average loan balance per household 104% of objective 126 loans 420% of objective Increased Home Equity Loan HH Share of Wallet from 45.7% to 47.9% - 103% of objective

11 Lisa Totaro Marketing Associate Sunmark FCU $374 Million

12 Sunmark Federal Credit Union Mortgage & Auto Loan Successes (Albany, NY -- $374m assets)

13 Sunmark Auto Loans: Promotion Results 250 applications/week $2+ million volume/week

14 Auto Loan Promo: Marketing Integrated marketing campaigns Unique creative

15 Sunmark Mortgage: 2012 Excellence in Lending winner 550% origination growth since 2005 $200+ million originated in 2012

16 Mortgage: Marketing Integrated campaigns 4.3% direct mail conversion (Fall 2012) No Closing Costs campaign 63% annual volume closed after introduction in Sept 2011

17 Alison Wolf Vice President of Marketing FAA Credit Union $530 Million

18 Growing Loans It s More Than an Interest Rate

19 Overview Exited the Business Lending Market Had a $60 Million Loan Gap to Fill Real Estate Portfolio Shrunk Significantly Over Time Record low rates caused loans to be sold to Fannie Mae Focus had been business lending and indirect lending Averaged less then $1 million a month in production since 2009

20 What to do? VP of Lending spot was vacated Duties were divided Indirect Business Lending Consumer/Visa Real Estate That s where I come in

21 First Things First Decided to take a big picture approach Evaluate what we did right and what we did wrong Meet with every employee Look at competition Evaluate programs, rates, service uh oh!

22 Wow we really do that? Service was a major fail! Made people wait two weeks to apply in person (yes, really) Rates were ignored (hadn t been adjusted in years) It was impossible to even apply, better yet, get a loan (no phone calls, please) Does anyone care? (FSRs took the easy route) No follow up by anyone maybe your loan closes, maybe it doesn t

23 Solving the Problem Had a lot of room for improvement What s happening to applications? Long process Make applying easier 3 rd party, branches, 3 choices Adjust rates and fees Update the rate sheet (let s put ourselves first) Give members options

24 Marketing Items

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26 Results Results: 2012 Booked $98 Million in-house real estate loans Best month was $11 million! New record. Year over year growth of 41% Branches are especially busy with applications Continue to see high demand. Still have some service issues, trying to work through these. New VP hired late 2012, she has taken control of department.

27 Kristen Mashburn Director of Marketing Listerhill CU $620 Million

28 Listerhill s Lending Success 2011 Campaign Just Move It Generated $90 million in loans 13% increase Gave our members $450, Campaign So Can You Generated $105 million in loans 20% increase Gave our members $550,000

29 Gaining the Team s Buy-In Involving the team from the beginning Rewarding employees Communicating clearly and frequently

30 Gaining the Team s Buy-In Involving the team from the beginning Pulling together a cross-sectional team Using their ideas (and giving them credit for them!) Saying Thanks!

31 Gaining the Team s Buy-In Rewarding Employees Cash is King Put a Face on It Make it Tangible

32 Gaining the Team s Buy-In Communicating clearly and frequently Staff Sheets Launch Video Weekly Updates

33 Crafting the Right Message Finding Relevance Performing an environmental analysis Communicating Clearly and Concisely Avoiding fine print Providing a strong call-to-action

34 Crafting the Right Message Our Message

35 Selecting the Right Medium A mixture of mediums is essential Telling the complete story

36 Selecting the Right Mediums Traditional Telling the Complete Story Event Digital/Unconve ntional

37 Documenting for Future Use Project Plan Online Project Management Recap Campaign

38 Brian Griffith Marketing & Communications Manager Gesa Credit Union $1.2 Billion

39 It s All About Who You Know. Gesa Credit Union Richland, WA

40 Gesa Credit Union Founded in 1953 to serve GE Supervisors; Community Charter in 1997, serving Washington state; $1.2 billion in assets;115,000 members; 11 retail branches (13 by year end), and 7 high school branches; Began offering MBL in 2009; Commercial Services Team: 10.5 FTE; Marketing Team: 8 FTE; $112mil in Loan Portfolio.

41 Commercial Connections Commercial Services Department was founded in Team is comprised of Commercial Lenders from large regional banks. We are the largest CU offering Commercial Services in our region.

42 Telling our MBO s Stories Small local boutique winery who relies on Gesa Line of Credit for seasonal operating funds. Well-known and connected wine maker (relies entirely on Club sales.) Also uses commercial banking services.

43 Telling our MBO s Stories Largest commercial real estate agency in region. Well-known and connected commercial Realtor. Strong testimonial on Gesa s behalf.

44 Celebrate & Share

45 Direct Mail, Newsletters and Community Events Quarterly Newsletter for Member Business Owners Launched April 2012 Purchased business prospect lists from Equifax for direct mail campaigns. Sponsored Regional Business Expos, Technology Expos, and Manufacturing Expos.

46 Results

47 QUESTIONS?