Are you ready for the historic deposit term tsunami?
Within the next year, a significant number of bank CDs will mature, totaling approximately $2.5 trillion. Another nearly $9 trillion in government debt holders will also look for their next investment. Where will all these funds end up? Personalized engagement is now one of the best ways to retain them or win them over to your institution.
In three months, nearly $950 billion in bank CDs will come to term. And that’s the first and smaller wave of a coming maturity tsunami for time investments. Some $2.5 trillion in bank time deposits will mature within 12 months; a record $8.9 trillion of government debt is set to do the same.
After the biggest time-investment origination boom since before 2009, savers using CDs, share certificates and U.S. Treasury bonds will be in the market for time investments en masse. As they receive emails and letters notifying them that their maturity date approaches, they will decide: Where should I place my money next?
Most depositors have a tremendous amount of opportunity in that question right now. Banking has never been more disunified in its approach to deposit pricing, and the industry has also never been more varied in its marketing acumen. Marketing sits at a focal point as bank and credit union executives consider how they keep deposits without getting cornered by rate-matching demands.
Loyalty may seem like it’s dying, but it’s really just become different today. Improved deposit pricing and segmented engagement via the marketing department can build a new form of relationship banking. It’s become an enormous opportunity to retain and attract deposits — and to do so profitably.
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