Why Empowered Employees Are Key to Unlocking Loan Growth

Banking Industry Trends

In today’s interest rate environment, community banks feel pressured to grow loan volumes across all channels to ensure profitability. Many institutions are concentrating their efforts on certain types of commercial loans to boost profitability this year – in particular, commercial C&I loans (62% of banks) and commercial real estate loans (49%), according to research from Cornerstone Advisors. As they focus on profitable portfolio growth, banks must avoid pitfalls in the commercial loan origination process, whether that’s inefficiencies in their lending workflows or being exposed to additional risk.

Meanwhile, hiring and retaining talent continues to be a challenge for community banks, especially those operating in smaller markets. In fact, banks cited talent as one of the top businesses challenges for the year ahead in BAI’s Banking Outlook 2023 Trends survey.

Given the tough labor market, community banks across the U.S. are struggling to recruit experienced lending personnel, especially commercial lenders. As a result, many banks have turned to their existing staff to process loan requests and recommend the right products to borrowers. However, existing staff often lack the level of expertise needed to process business and commercial loan requests, and guide prospective borrowers to the appropriate products. 

As banks focus on marketing certain product lines or loan types, empowering your current employees to better serve business and commercial customers will be key to achieving those growth goals.

Identify pain points for your team.

Employees are one of the most valuable assets banks have, as they represent your institution for customers and the broader community. For institutions to grow, bank leaders must ensure employees have the tools, resources and support they need to accomplish their work as easily, efficiently, and accurately as possible. Beyond efficiencies, employees should also feel confident they have the knowledge and technology available to help them capture, complete and close loan requests without wondering if they missed a step.

So, how can you get there?

Your bank can start by evaluating its current loan processes. Determine what’s working and what’s not working from a technology standpoint. Here are a few considerations to think about: How do employees currently interact with potential borrowers? How do we underwrite different types of loans? Is my portfolio segmented? Is my bank serving a niche market, and are we serving it well? Are customers or employees flagging inefficiencies at various stages of the lending process?

You may realize there are certain areas that consistently present roadblocks. For example, employees may need to re-key the same customer’s information across multiple systems, increasing the time needed to complete tasks and upping the risk of clerical errors. Or, they may find that certain solutions are out of synch with the latest information, rates or credit policies, making it difficult to provide up-to-date offers to customers.

Once any roadblocks are identified, your bank can determine which tasks could be optimized or automated with a stronger technology stack to make the workflow easier for your team.

You should also consider where internal knowledge can be institutionalized to support both current and future staff. Your bank likely has a few superstar team members who are experts on your products and certain markets based on years of experience. For instance, one employee may be knowledgeable about construction loans while another may be an expert in agricultural lending.

However, when these high-performing employees move on or retire, you don’t want to lose that information with them. A strong commercial lending software solution can help store their insights and make sure they’re available for the next generation of employees that comes through. In the meantime, a reliable knowledge base will also help with staff training, internal organization, and record keeping.

Capture, complete and close with confidence.

Your bank should also consider specific areas where a tailored technology solution can facilitate tasks or streamline workflows for your team. In particular, digital lending tools like the Baker Hill NextGen® Banker Application can automate and optimize the loan origination process by ensuring all necessary documents are captured and complete loan application packages are submitted every time.

Such tools not only support the shift to a fully digital lending workflow by eliminating the need for paper-based loan applications and document checklists, they also reduce compliance challenges and delays caused by submitted applications with missing or incorrect information.

Additionally, the right lending software can help all bank employees:

  • Validate current information and only gather the required applicant data using digital workflows, streamlining the entire process for both the customer and employee.
  • Appropriately match loan requests to the product lines that have been targeted for growth objectives by your bank.
  • Impress customers from the first interaction with seamless application process, all the way through underwriting to post-close.

Ultimately, your bank’s employees are the frontline of your business and are critical stakeholders in your bank’s success. Leverage the latest technology to empower them as much as possible with digitally-enabled, intuitive workflows that puts the information they needs at their fingertips. By doing so, you can ensure your team is equipped to generate loan growth at every interaction while delivering a superior  experience for your customers, including your bank’s valuable commercial clients.