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Strategic Loan Pricing

This session will cover seven strategic concepts. Along the way, we will demonstrate how to measure loan profitability and calculate the required rate of return on a loan. We'll discuss how to use the components of most loan pricing models to understand where you have a competitive advantage – and also where your bank does not have an advantage.

OnDemand
Recorded Monday,
August 16th, 2021
Presented by Richard Hamm
2h total length
2.5 CEU Credits
$279.00 or 1 Token

Includes: 30 Days OnDemand Playback, Presenter Materials and Handouts

  • Lending
  • Board Member
  • Commercial Lender
  • Consumer Lender/Retail Banker
  • Credit Analyst
  • Marketing Officer/Business Development
  • Private Banker
  • Senior Management
  • Small Business Lender
  • Workout Specialist/Collector

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With intense competition to capture loans, plus ever-changing levels of interest rates, it is important to have a strategic approach to loan pricing – not just matching or reacting to the competition. This program outlines the ways your bank can cover costs and meeting profit objectives by differentiating loan interest rates to reflect relative risk, plus knowing that you CAN win the borrower's business on a basis other than the lowest price.

This session will cover seven strategic concepts. Along the way, we will demonstrate how to measure loan profitability and calculate the required rate of return on a loan. We'll discuss how to use the components of most loan pricing models to understand where you have a competitive advantage – and also where your bank does not have an advantage. Another important concept is getting premiums for taking risk and for adding value to the customer relationship, and ways to compete with a lower rate for volume or when you are able to mitigate risk better than your competitor can.

Covered Topics

  • The key drivers of loan profitability
  • Using the drivers of loan profitability to “scout" your competition
  • Differentiating the rate on all risk metrics
  • Recognizing economies of scale on larger loans
  • Watching out for loans that are typically under priced
  • Other strategies to consider

Who should attend

Commercial lenders, private bankers, small business lenders, community bankers, credit analysts, portfolio managers, assistant relationship managers, lending managers and credit officers.


Richard Hamm

Instructor Bio

Richard Hamm has been training bankers for 28 years, designing and delivering courses specializing in commercial lending and credit, including portfolio and risk management, commercial real estate (CRE) and appraisals, plus selling and negotiating skills, and director training. He also conducts eight senior lender forums on a periodic basis in multiple states and one series at the national level.

He is based in Huntsville, AL and has owned/operated Advantage Consulting & Training for 14 years, after a 22-year banking career including senior positions in lending and credit, plus president of a community bank through formation and acquisition of an existing bank. He has BS and MBA degrees from the University of Alabama.


Credit Information

Recommended for 2.5 CEU Credit Hours. After attending this webinar, each attendee can receive a Certificate of Attendance for self-reporting of CEU Credits.