Welcome to the Top 5 Percenter™ Blog

Stop Rate Matching: The Strategy That Protects Your Net Interest Margin [VIDEO]

by | High Performance, Increase Net Interest Margin, NIM, Premium Pricing, Profitability and Growth, Sales Process, Sales Training

Stop Matching Rates. Start Protecting Your Margin.

Every time your bank matches a competitor’s rate, you’re making a strategic decision—even if no one intended it.

Most strategic plans never say, “Let’s compete on price.” Yet many community banks execute exactly that strategy every day. Rate matching quietly erodes net interest margin, trains customers to shop instead of trust, and leaves profitability at the mercy of competitors.

The banks consistently commanding premium pricing don’t simply have better products, they have a better sales system, stronger differentiation, and a disciplined execution strategy that makes rate matching unnecessary.

This week’s video will reveal why so many banks unintentionally commoditize themselves and what separates institutions that consistently protect their margins from those trapped in endless pricing battles.

In this video, you’ll discover:

  • Why rate matching is a symptom of a deeper strategic problem—not the problem itself.
  • The systems top-performing banks use to command premium pricing without losing customers.
  • How the right sales process and differentiation strategy protect your net interest margin.

If your bank is still competing on rates, it’s time to rethink the strategy behind the numbers.

Watch the video below.

I bet your strategic plan does not have anything in it that says, “We want to match rates. We want to shrink our net interest margin.”

“Oh, what can we do to match the rates of our desperate competitors?”

Those words are probably not in your strategic plan, and yet the way that your plan is being executed demonstrates a reliable, predictable pattern, which basically means your people are still matching rates. So we need to address rate matching, not only from a decommoditization standpoint, but also how you handle this strategically at the same time.

I’ll tell you what—it’s really easy to do what’s normal in banking: sit behind the desks, wait for the requests, match the rates, or, on the deals that you call out on, take them through a typical sales process but then end up having to match the rates anyway.

What is it about your strategy that’s wrong? If you knew that, you’d say, “Roxanne, I’d have this fixed by now.” Well, of course. But how long can you live with not fixing the strategy that doesn’t allow you to increase your pricing?

There are many false attempts, and many people try very hard in their banks, as good bankers, to command premium pricing, and yet the job doesn’t get done. There’s always the next excuse.

“It’s the competitors.”

“It’s that nobody is loyal anymore.”

There are lots of excuses, but what are the strategies that are going to take you out of that? How are you going to approach things?

Strategy, by definition, is this: with limited resources, what do you need to do to make sure you hit an outcome? Most people only talk about the limited resources. The “doing” has everything to do with: Do you have the right sales system? Do you have the right differentiation?

Do you have the right attentiveness to the right sales system? Does everyone know how to follow it? And the proof is in the pudding, as my grandfather used to say. If you’re commanding great premium pricing, your people are doing all of those things right.

More From The Blog

The Great Money Migration of 2021 [VIDEO]

Which side of the great money migration of 2021 will you be on? There was a day when customers used to walk in your lobby—those were good days. They loved you. They...

An Oasis of Loan Growth… [VIDEO]

Loan demand has dried up. Boy, those are words you never want to hear. Not just because you don't want to hear that there isn't as much demand for loans, but when your...

Remember What It Is All About [VIDEO]

The economy has gotten tougher. People are getting crankier. A lot of people are still unhealthy. Everywhere you look there seems to be a new problem, but how many new...

The Virtues of a Gratitude Habit [VIDEO]

Just today I heard about one of our banks where a quarter of their people are out with COVID. Hmm. These are challenging times. Imagine trying to run a bank with that...