It was an important deal, and Rabobank was in danger of losing it.
A customer with a large loan wanted it restructured. Otherwise they were going to pay the loan off and take their business elsewhere.
“With the terms, we needed to structure a deal that would change the conversation and retain a valued customer,” said Kyle Koelbel, Rabobank’s Chief Financial Officer.
This sort of situation was exactly why Rabobank, National Association – a unit of Rabobank Group - had previously been in the market for a tool to help them with their commercial loan pricing.
“We were really looking for something that would embrace the entire relationship of our customers,” Koelbel said.
Rabobank initially looked into whether this was something they could build in-house, but quickly dismissed that idea. They went looking for solutions, did their due diligence and eventually chose PrecisionLender.
“In the end, the ease of use of PrecisionLender, the amount of information, and the ability for lenders to structure deals that work for their client was what ultimately won the day,” Koelbel said.
Empowering the Lender
The key, Koelbel noted, was in the power the lenders now had. They enjoyed greater transparency and more ability to shape deals.
“They like that PrecisionLender gives them different options,” Koelbel said. “If they need to improve the economics of a transaction, they could bring in more deposits, or they could reduce the tenure of a loan to reduce the risk. They now had efficient ways to make the deal work and meet the needs of the customer.”
That feeling of control, as well as a straightforward, uncomplicated interface, ensured that PrecisionLender had a high adoption rate among Rabobank’s lending force.
“If it’s not easy to use, your lenders aren’t going to use it,” Koelbel said.
Advising, not Selling
Rabobank’s lenders are using PrecisionLender, and it’s resulting in stronger, deeper relationships with customers. That’s given Rabobank a way to separate themselves from the competition.
Now, when Rabobank’s lenders sit down with customers, they’re asking questions, seeking to really understand the customer’s needs. The more information they can gather, the more options PrecisionLender will be able to offer. The more options offered, the more likely a deal can be structured that leaves both the borrower and the bank feeling good.
Back to the Big Deal
Ultimately, that’s what helped Rabobank rescue the aforementioned big deal. The discussion didn’t immediately turn to “Can we match the rate?”
Instead, Rabobank asked other questions. They found out which parts of the deal were important to the customers and which parts didn’t particularly matter. They changed the former group to appeal to the customer, while tweaking the latter group to reduce some of the transaction’s risk for the bank. Eventually they found a solution that worked for everyone.
“In the end, we were able to re-structure a loan that favored both our customer and the bank,” Koelbel said.
Deal saved. Deal improved. Customer satisfied. Relationship strengthened.