Is your certificate promotion doing what you want?

As liquidity and cost of funds pressures continue to be a focus, credit unions are exploring possible funding options within the liquidity toolbox. Among them, certificate promotions which, in this rate environment, are becoming a more frequently used tool.

On the surface, attracting liquidity through certificates seems straightforward. Offer a competitive rate, promote it, and the dollars typically come in with ease. However, before rolling out that next certificate promotion, there are several important items to consider to make it as effective as possible.

For example, has the credit union run a what-if and do the right decision-makers understand the impact of the certificate promotion potentially cannibalizing existing low-cost deposits? This challenge has been addressed in previous blogs, specifically the one titled Hidden Cost of Addressing Liquidity Needs.


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