How to Get the Most from Your Banking Relationship

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How to Get the Most from Your Banking
Relationship

• Presented By Susan M. Cotton
• Money Matters Consulting
• April 22, 2010

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New Trend in Banking

• Lower Rates
• (Earnings Credit Rate)

• Higher Bank Fees
• (Hard Dollar Fees)

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How Low Can You Go?!

• Before

• Now

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What To Do?!

• Shop ECR and other Deposit Rates
• Manage Bank Balances Better
• Control Bank Fees
• Know Thy Banker!
• OR
• Wait Until Rates Go Up

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Shop ECR and Other Rates

• ECR is a short-term rate based on 3 month T-Bill.
• It can vary, however, from bank to bank.
• Banks wanting deposits will offer a higher rate.
• ECR is not guaranteed or fixed. Beware!
• Tiered rates based on balances, type of customer.
• Consider different types of bank accounts.

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Manage Bank Balances Better

• DDA Sweep
• Balances moved from checking to sweep fund.
• Double-check prevailing rates. Might be low.
• Sweep balances are not FDIC-insured.
• Eliminates chance of excess balances.

• Controlled Disbursement
• Use a separate bank routing point.
• Check presentment totals presented in the am.
• Transfer money to DDA if necessary.
• Maintenance required!
• Can use with Positive Pay.

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• Your Account Analysis Statement is an invoice and
  should be reviewed carefully.

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It All Adds Up!
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Look for the following
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Do More Banking On-Line

• Account Analysis
• Copies of Checks
• Account Transfers
• Information Reporting
• Wire Transfers
• Key is to reduce bank manpower time
• Tel. calls, faxes, paper copies, snail mail

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You Snooze, You Lose!

• Identify bank problems within 30 days.
• Review Account Analysis statements upon receipt.
• Bank surpluses cannot be carried forward to next
  year.
• Problems cannot be corrected from prior year.
• Bank client has greater burden to identify
  problems.
• Use Spreadsheet to input Account Analysis data.

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Know Thy Banker

• Meet with Rel. Mgr. annually (quarterly
  preferable)
• Discuss problems, new services, bank compensation
• Negotiate a fee schedule
• Have pricing fixed for set period of time
• Go over Account Analysis statement in detail
• Ask for Account Analysis training session for
  staff

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Youre a Winner If

• You have a contractual fee schedule in place
• You can accurately budget for banking expenses
• You review Account Analysis right away
• You can identify what each line item means
• You do not keep excess balances in your accounts
• You maintain an Account Analysis spreadsheet

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