Diets and Deposits

My cousin Roy is one of the nicest people on earth. He has a big heart, a big personality, and an appetite to match. He’s never met a person he didn’t like, a puppy he didn’t want to take home, an onion ring he couldn’t get around, or a pie he wouldn’t take seconds on. He’s what my mother calls a good eater.

Consequently, his weight has long been a source of anguish to him.

He’s tried every diet known – the high-protein, low-carb diet (he gained ten pounds); the high-carb, low-fat diet (5 pounds); grapefruit diets; Mediterranean diets – you get the idea. And all with the same result: he loses a few pounds, and then gains back more.

So imagine my surprise when a new svelte Roy showed up at the last family gathering. “Gosh,” I said, “how’d you do it? What diet finally worked for you?”

Sheepishly, he replied, “I stopped dieting – they weren’t working, so I stopped.”

“I figured that a better approach was to just eat like skinny people do. So I started watching portions, eating more veggies, and turning down seconds.” “And I hit the gym. All in all, it was just about doing a lot of little things right. It didn’t happen overnight but I began to lose weight.”

Here’s the part where Roy’s “How I Stopped Dieting and Started Living” story ties in with banking.

In the past, attracting deposits was relatively easy. Run a high rate promotion, lock’em in with CD, renew’em automatically when they come due, and call it customer loyalty.

All well and good while it worked, but with the new national rate restrictions those rate promotions will not work for a lot of banks. So bankers who used that approach exclusively and counted on the niceness of their customer service people to build loyalty are facing a world of eroding deposits.

So what do you do instead? Maybe it’s time to adopt best practices in building deposits. Here are a few suggestions:

  • Recognize that attracting and retaining core deposits is a full-time, long-term process – just like losing weight. It’s more important to do a lot of little things right – every day – than it is to have a series of blow-out promotions.
  • Get a plan. You probably tell your clients “Fail to plan, plan to fail.” Same thing with building core deposits. A workable plan puts you in control. You can observe and measure what’s happening, make adjustments and take action before crises happen.
  • Recognize that some “valued customers” are more valued than others. Identify your high-value, high-profit customers, the ones who contribute most to your bank’s profitability. Once these customers are identified, cherish them. Lavish attention and benefits on them, whatever it takes to keep them.
  • Don’t guess – find out what your best customers want and institute best practices in customer care to deliver them. (There are some relatively inexpensive and easy approaches to obtaining this information objectively from customers). Then train your staff, and keep on training them on what makes a difference to your customers and how to inspire them to open more accounts with you.
  • Now figure out what types of prospects you have the best probability of attracting and go after their relationships.
  • Put numbers to it. What’s a reasonable objective for growing deposits, and how much will it cost you? What deposits will you lose every year, and how can that money be replaced? How much more business can you get from existing satisfied customers?
  • As you can see, developing and keeping a strong deposit base and customer loyalty not achieved overnight. So start today – figure out the “little things” you and your team can do every day – and do them, every day!

If you need help developing a practical and effective plan to attract and keep core deposits Lauren can be reached at

New Years Resolutions
Hope for the Best But Prepare for the Worst

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