Could Lenders use a Loan Pricing Tool?

/in , , , , /by

Bank lenders need to know which customers are profitable and which ones are not. Does the type and size of the loan matter and how do you factor in the customer’s deposit relationship into the profitability equation? Do your bank’s lenders work for the customer or for the bank when it comes to loan pricing and whether or not to charge a fee?

These are all good questions and a loan and deposit pricing tool will help banks increase net interest income and win more deals when in a competitive situation. Even though getting fees on loans is always a good thing do they really matter to the profitability of the loan? Of course the answer is it depends on the type, size, and term of the loan. Not many banks factor this into the equation.

Relationship profitability many times comes down to does the customer have multiple loans and deposits with the bank? Or, could I get a deposit account if I make a loan to a new customer. All of this is relevant but the type and size of the loans/deposits are critical. Are the deposits interest bearing or in an operating account? Are the customer’s loans small or large and how many loans are there?

Loan pricing tools have been around for decades and many large and regional banks use them. Strunk’s loan, relationship and deposit pricing solution is easy to use, affordable and your lenders will like the tool. Contact Strunk at 800.728.3116 or email at info@strunkaccess.com to learn about how our loan pricing tool will increase net interest income by at least 25bp.

 

An independent certified public accountant has examined Strunk’s operations and found them to be in compliance with the AICPA’s Trust Service Principles. It was determined that Strunk meets the Security, Availability, Processing Integrity, Confidentiality, and Privacy criteria for SOC 2 established by the AICPA.