1. Tim Keith – Chief Strategist
Achieving Material Yet Efficient
Deposit Growth Through Analytics
and Marketing

2. Any successful sales process requires
Capacity
The person you are selling to must have the basic means to buy the
product
Propensity
The person you are selling to must have some inclination to buy the
product

3. Data driven deposit generation – key principles
• Material yet efficient deposit growth in this market requires taking some
repricing risk
• The more they have with you, the more they have somewhere else
– The most efficient source of deposit growth is existing High Deposit Households
• The best retention tool is proactive cross-selling
• With declining branch visits and cell phone call screening, it is vital to
provide customers with easy ways to self identify as “in market” as
points in time
– Marketing can/should become a key tool in deposit portfolio management
• Digital channels vastly expand awareness while making outreach
dynamic. They also provide direct evidence of consumer interaction
with the marketing
• What most banks and credit unions lack is the discipline to consistently
execute

4. Marketing repricing risk - fallacies
1. 100% of liquid deposits held by targeted households are at risk of
repricing in rate oriented deposit marketing campaigns
– Normative campaign response rates are <10% meaning >90% is not at risk
– The weighting of price to the money market tier structure can mitigate risk further
2. If I do nothing, everything will stay the same
– Any static group of deposit households will show run off over 90-120 day periods – this is accelerating in most
markets as aggressiveness of competitive rate offers have increased
3. Ignoring the relationship benefits created by engaging a customer
with rate offers
– The “halo affect” is real – rate offers tee up conversations between sales people and customers which produce
additional product purchases
– When a customer buys a new product, relationship retention increases
4. There is not a material price sensitivity difference between customers
and prospects
– Customers are less rate sensitive than non-customers, the difference can overwhelm repricing cost

5. Key questions – normative benchmarking
• How does accounts per household compare to peer?
– Are strengths or gaps driven by product mix, sales or delivery?
• What percentage of my total households were new in the last 12
months and how does that compare to peers?
– How much of my deposit growth is coming from New Households?
• What percentage of households only use one service with the
institution?
– What is my cross-sell potential and attrition risk among Single Service Households?
• How concentrated are my deposits?
– Do 3% of households control 50% of deposits? Is this normal?
• How strong are my High Deposit Household relationships?
– Am I meeting the transactional and credit needs of my High Deposit Households?
• Is my overlap between deposit and credit usage normal?
– What is my opportunity to sell more deposits to Loan Households?

6. Example – deposit concentration
• Households with $100,000+ in deposits make up 4% of customers
and control 55% of deposits. 826 don’t have checking. 89 are
single service.
• Households with $10,000+ deposits make up 22% of customers
and control 93% of deposits. 2,867 do not have checking. 650
are single service.

7. Repricing risk model – money market
Target Universe - High Deposit Checking Households w/o Money Market, Single Service CD Households, Underfunded Money Market Accts
Scenario 1 - Most Conservative Scenario 2 - Middle of the Road Scenario 3 - Aggressive
Projected Response Rate 1.80% Projected Response Rate 1.80% Projected Response Rate 1.80%
Normative Response Rate 1.80% Normative Response Rate 1.80% Normative Response Rate 1.80%
Response balance $69,000,000 Responders 1200 Responders 2880
New Money $34,500,000 Response balance $69,000,000 Response balance $69,000,000
New Money % 50.00% New Money $48,300,000 New Money $58,650,000
NIM on New Money @ 1.25% $431,250 New Money % 70.00% New Money % 85.00%
Repriced Money $34,500,000 NIM on New Money @ 1.25% $603,750 NIM on New Money @ 1.25% $733,125
Repricing Cost @ 1.5% $517,500 Repriced Money $20,700,000 Repriced Money $10,350,000
Attrition Prevented $17,250,000 Repricing Cost @ 1.5% $310,500 Repricing Cost @ 1.5% $155,250
NIM on Prevented Attrition $172,500 Attrition Prevented $10,350,000 Attrition Prevented $5,175,000
Contribution Benefit $86,250 NIM on Prevented Attrition $103,500 NIM on Prevented Attrition $51,750
Cost of Program $100,000 Contribution Benefit $396,750 Contribution Benefit $629,625
Net Contribution Benefit ($13,750) Cost of Program $100,000 Cost of Program $100,000
Net Contribution Benefit $296,750 Net Contribution Benefit $529,625

8. Repricing risk model - CD
Target Universe - ALL High Deposit Checking Households, Single Service CD Households
Scenario 1 - Most Conservative Scenario 2 - Middle of the Road Scenario 3 - Aggressive
Projected Response Rate 3.91% Projected Response Rate 3.91% Projected Response Rate 3.91%
Normative Response Rate 3.91% Normative Response Rate 3.91% Normative Response Rate 3.91%
Response balance $99,000,000 Responders 2000 Responders 2000
New Money $49,500,000 Response balance $99,000,000 Response balance $99,000,000
New Money % 50.00% New Money $69,300,000 New Money $84,150,000
NIM on New Money @ 1% $495,000 New Money % 70.00% New Money % 85.00%
Repriced Money $49,500,000 NIM on New Money @ 1% $693,000 NIM on New Money @ 1% $841,500
Repricing Cost @ 1.5% $742,500 Repriced Money $29,700,000 Repriced Money $14,850,000
Attrition Prevented $24,750,000 Repricing Cost @ 1.5% $445,500 Repricing Cost @ 1.5% $222,750
NIM on Prevented Attrition $185,625 Attrition Prevented $14,850,000 Attrition Prevented $7,425,000
Contribution Benefit ($61,875) NIM on Prevented Attrition $111,375 NIM on Prevented Attrition $55,688
Cost of Program $120,000 Contribution Benefit $358,875 Contribution Benefit $674,438
Net Contribution Benefit ($181,875) Cost of Program $120,000 Cost of Program $120,000
Net Contribution Benefit $238,875 Net Contribution Benefit $554,438

9. Omnichannel deposit marketing calendar
January February March April May
direct mail/email direct mail/email
IP Targeting/
Retargeting /FB
IP Targeting/
Retargeting /FB
IP Targeting/
Retargeting /FB
IP Targeting/
Retargeting /FB
IP Targeting/
Retargeting /FB
direct mail/email direct mail/email
IP Targeting /
Retargeting/ FB
IP Targeting /
Retargeting/ FB
IP Targeting /
Retargeting/ FB
IP Targeting /
Retargeting/ FB
direct mail/email
IP Targeting /
Retargeting /FB
IP Targeting /
Retargeting /FB
IP Targeting /
Retargeting /FB
Cross-sell
Analysis
Checking Xsell
Upsell, eSVC
Money Market
Xsell
CD Xsell
Checking Xsell
Upsell, eSVC
Tracking ReviewTracking Review
CD Xsell

10. 12 month program proforma
New Average Total Halo Halo Contribution 12 Month 36 Month
Deposits Accounts Balance Balance Accounts Balance Impact ROI ROI
Checking Cross-sell 400 $4,500 $1,801,260 160 $2,401,680 $103,072 91% 218%
Checking Up-Sell 1,209 $7,500 $9,067,500 1,596 $7,254,000 $317,363 163% 488%
CD/MM Cross-sell 1,279 $47,500 $60,752,500 1,279 $12,790,000 $637,901 950% 2280%
Total Deposits 2,888 $24,797 $71,621,260 3,035 $22,445,680 $1,058,336 349% 838%
Home Equity 46 $75,000 $3,420,000 16 $79,800 $27,360 500% 1050%
Direct Installment Loan 812 $32,500 $26,405,600 183 $457,020 $284,368 250% 525%
Debit Card 365 N/A N/A 182 $911,550 $36,462 104% 250%
Onboarding 2,400 4,500 $10,800,000 $378,000 740% 1776%
Grand Total 6,511 $18,262 $112,246,860 3,416 $23,894,050 $1,784,526 426% 1022%

11. Campaign case study #1 – CD
Campaign Objective
To grow time deposits while expanding and retaining key customer
relationships
Offer
Targeted households received a 2.25% 14 month CD offer requiring
$10,000 in new money and a checking account
• Customers targeted had high capacity based on external
demographic indicators but limited existing relationships due to
fear of repricing risk
• The campaign yielded 503 CDs with $23 million in balances

12. Response rate by household deposits
Households with >$50,000 in deposits prior to the campaign made up 23%
of targeted households but accounted for 72% of balances generated
0.04%
0.42%
3.36%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
< $10,000 $10,000 - $50,000 $50,000+

13. Average balance by household deposits
Response rate and average balances were directly linear (high to low)
with household deposit levels prior to the campaign

14. Responder household purchase activity
24% of responder HH also purchased other deposits including 18% who
bought checking
23.73%
16.10%
2.12%
5.51%
1.69%
0.00%
10.00%
20.00%
Additional Deposit Consumer Checking Savings Money Market Business Checking

15. Campaign case study #2 – MMA
Campaign Objective
To liquid deposits while expanding and retaining key customer
relationships
Offer
A primary competitor was prominently offering 2.25% on Money
Market savings. This campaign sought to leverage a targeted
approach and current customer relationships to counter this offer
but an acceptable NIM. 1.75% was offered for balances >$25,000.
• The campaign yielded 352 money market accounted $35
million in account balances over a 90 day campaign window at
a cost of 10 basis points per dollar.

16. MMA cross-sell net change in deposits
The average response balance was $98,168 making the new money
percentage 76%

17. MMA cross-sell net change in deposits
The level of deposit with the bank prior to the campaign predicted
response to the offer
0.00%
1.39%
3.18%
0.00%
0.50%
1.00%
1.50%
2.00%
2.50%
3.00%
< $10,000 $10,000 - $50,000 $50,000+

18. Average balance by household deposits
Households with $50,000+ in deposits prior to the campaign made up 47%
of targeted customers but 64% of response balances
$83,541
$109,029
$0
$25,000
$50,000
$75,000
$100,000
$10,000 - $50,000 $50,000+

19. Case study campaign scenarios
Actual Campaign Original Campaign
Rate Offered 1.75% 2.25%
Balances Generated $35,000,000 $50,000,000
NIM 2.25% 1.75%
Contribution $787,500 $875,000
Repricing Cost $105,000 $375,000
Retention Benefit $157,500 $157,500
NII $840,000 $657,500

20. Thank you!