Scott Earwood
Director of Community Solutions

The Current Climate: Bankers Are in, Lenders Are Out
I hear the same story from bankers around the country.  When asked if their bank sees itself as transactional or relationship oriented, they’ll reply, “We say we’re a relationship bank, but too many times we end up with single service clients.” This is a problem because a bank with a high percentage of single-service clients is inherently not a relationship bank.

Banking in 2024 requires a different, more comprehensive approach to relationship building than what has worked for the last 15 years. Gone are the days when a bank could make money by piling up loans and funding them with cheap deposits.  In today’s rate environment, margins have been compressed industrywide. On the horizon are potential charge-offs, shrinking deposit balances, and dwindling consumer stockpiles of cash.

To adapt and survive in this environment, bankers must become bankers again. That means viewing relationships holistically, which includes understanding that today’s customers are just as interested in their deposits as their loans.

Why Relationship Banking is Better
Full and optimized relationships drive the profitability of any bank. Data collected from our client base shows that 15% of the average bank’s consumer relationships are responsible for 75% of its deposits and 50% of revenue. It also shows that a business relationship that includes treasury management and the primary operating account generates about three times the return on capital of a loan-only relationship.

Is your bank committed to getting the most out of its relationships? Ask yourself the following questions:

  • Does detailed knowledge of customer relationships exist outside of your bankers’ heads?
  • Does the bank know the profitability of individual customer relationships?
  • Does each banker have the tools and information needed to serve and optimize their own customer relationships?

If your bank is truly committed to relationship banking, the answers to those three questions should be ‘yes.’

Why Full Relationships Matter to Your Customers
Whether it’s a complex commercial client with multiple tax entities or a married couple with a few accounts, when clients interact with your bank’s frontline employees, they are usually thinking about their entire banking relationship. Can your employees say the same?

Complex client needs and siloed bank product data often make it difficult to compile an at-a-glance view of relationships. Breaking down those silos and presenting the scope of the entire relationship to team members can help ensure that customer needs are understood and met.

Why Full Relationships Matter to Your Bank
Many institutions think of themselves as relationship banks, but their customer and account data tell a different story.

When asked to list their 10 best clients, for example, bankers will typically list their largest clients or the people they see most often. Line up those lists against relationship profitability metrics and those bankers typically are missing three or four of the top 10 because they lack critical information about the relationship.

Bankers who have access to account- and relationship-level profitability information can protect their winners, improve their mid-tier relationships and get more from less-profitable customers.

Equipping Your Team
While goals and strategies are set by leadership, relationships are built by bankers and branch employees whose success depends, in part, on how well they understand the current state and the potential value of individual relationships. Giving those employees ready access to easily digested insights into those relationships and arming them with incentives and tools to help improve pricing and profitability can make those relationships stronger and more productive.

In 2024, the narrow path to growth runs through optimized relationships. Banks need to know which relationships are winning for them and which ones are losing. By combining traditional fundamentals and modern data technology, bank leaders can protect and deepen the relationships that contribute most to the health and profitability of their banks and transform their bankers into trusted advisors rather than order takers.


Scott Earwood

Director of Community Solutions

Scott Earwood is the director of community solutions for White Clay, and he is responsible for the community bank and credit union division.  Mr. Earwood spent the last 11 years at White Clay providing bankers with software tools and data intelligence to ensure return on liquidity and capital in each customer relationship.


Mr. Earwood spent the first 10 years of his career working for both national and community financial institutions in the retail, business banking and mortgage lines of business.  After banking, he started several businesses including a venture capital-backed start-up.