Get Back on the Fairway in Your Banking Relationships

Even the best golfers know what it’s like to hit one off the fairway. You line up a shot with confidence, make solid contact and still watch the ball drift into the rough. It happens. The key is knowing how to get back on course quickly and avoid making the same mistake again.

The same principle applies to banking relationships, specifically with loan pricing. Many bankers swing confidently at deals that look good on the surface — only to realize later that once you factor in risk, duration and profitability, the relationship isn’t producing the returns it should. The result is loan deals in the rough with spreads priced under 2%, and no proactive plan to improve these rates upon renewal. In fact, we’ve found that community banks have as much as 40% of their loans that don’t find the fairway. 

But when banks are diligent at identifying and adjusting these deals, they see immediate profitability improvement within their existing relationships.

The Main Reasons Bankers Miss
Most bankers price relationships without knowing exactly what they’re aiming for, or how slight changes to rate, term or risk affect the result far more than intended. These hidden inefficiencies are like shots in the rough: They take extra effort to recover and quietly cost the bank money over time.

Why does this happen so often? It boils down to two issues: 

1. 1. They didn’t have the right tools to price loans at a profitable rate. 

1. 2. They got too aggressive on discounts to win a new customer or keep a larger customer. 

But there is a way to get out of the rough. Banks need to systematically calculate the impact of their pricing decisions, and at renewal, banks need to have a plan to get them back on the fairway. White Clay has found that even smaller community banks can earn millions of dollars just by fixing their loan spreads under 2%. That is on top of the profits saved on new loans that are prevented from ever going into the rough.

By showing bankers where every relationship stands — and what good truly looks like — they will play a smarter, more profitable game.

Make Precision Part of Your Bankers’ Routine
Great golf isn’t about hitting the longest drive; it’s about precision. The same goes for banking performance. To ensure consistent progress and profitability, leaders need to build a disciplined process around three key habits:

1. 1. Inspecting. Ongoing reviews of each banker’s book of business and relationship improvement plans keep every banker accountable and on track. Continuous inspection ensures steady improvement — not just occasional success.

1. 2. Supporting. Provide your team with the tools and education they’ve never had before. Give them visibility into relationship profitability so they can understand the full value of each customer as well as the value of each account and product in the relationship.

1. 3. Incentivizing. Move beyond production based pay. Reward profitable growth, not just volume. When bankers are compensated for the quality of revenue, not just the quantity, the entire portfolio performs better.

What It Looks Like in Practice
With the right information, guidance and a clear plan, bankers can finally know what to aim for. They can identify which deals help the bank grow and which hold it back. They can price relationships precisely, manage them strategically and ensure every new relationship lands squarely in the fairway. Because when every banker plays with precision, the whole institution wins.