Executive Summary | Q4 2024
The Deposit Analytics Module provides comprehensive insights into deposit retention, rate sensitivity, and account profitability. Our analysis reveals significant opportunities to reduce deposit runoff through proactive rate management and targeted retention strategies.
| Metric | Current Value | Change vs LQ | Status |
|---|---|---|---|
| Total Deposits | $487.2M | +3.2% | Strong |
| Retention Rate | 94.3% | +1.1% | Excellent |
| Average Rate Paid | 2.85% | +0.15% | Monitor |
| Rate Sensitivity | 68% | Stable | High Risk |
| Account Profitability | $247/acct | +$12 | Good |
| At-Risk Deposits | $31.4M | +$2.1M | Needs Action |
68% of members demonstrate high rate sensitivity, significantly above the credit union industry average of 52%. This concentration creates both risk and opportunity:
Money Market and IRA Shares are outperforming with 4.5% and 5.1% growth rates respectively, while Special Savings products lag at 1.9%. Product-specific strategies can optimize overall deposit growth:
Clear seasonal trends indicate December and January as peak growth months (2.5-3.1% net growth) with summer months showing lowest growth (0.9-1.1%). Strategic timing of promotions and rate adjustments should align with these patterns.
High-value accounts ($50K+) generate $847 average profit per account, 19.7x more profitable than minimal accounts (<$1K). Current portfolio composition:
Implement targeted rate adjustments for the $31.4M in at-risk deposits. Analysis shows that a 25 basis point rate increase for high-value, rate-sensitive members delivers 39:1 ROI ($78.5K cost vs $3.1M retention benefit).
Your credit union currently trails top quartile competitors by 10-25 basis points across key products. Conduct a comprehensive rate review focusing on Money Market and IRA Shares where competitive gaps are widest and member sensitivity is highest.
Redesign Special Savings products showing 1.9% growth (vs 4.5% portfolio average). Consider bundling with high-performing Money Market accounts or creating seasonal promotional campaigns aligned with December/January peak growth patterns.
Develop relationship-based rate tiers that reward high-value members while maintaining profitability across all segments. Focus retention efforts on the 12% of accounts generating 67% of profits while identifying pathways to migrate medium-value members upward.
All scenarios maintain consistent ROI due to the significant spread between intervention costs (rate adjustments) and replacement costs (losing and reacquiring deposits). Additional benefits include reduced acquisition costs, preserved member relationships, and sustained profitability from high-value accounts.