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Funding and Liquidity Experience

Migration from warehouse lines to FHLB Advances

  • Executed all FHLB membership agreements
  • Compared advance rates against various forms of collateral between alternatives
  • Shifted funding process from one-by-one draws (hundreds each day) to managing daily balances with the FHLB (one transaction in or out)
  • Negotiated attractive terms for unused back-up lines

Diversification of funding sources

  • Expanded collateral pledged to the FHLB to increase capacity
  • Established relationships with several listing services
  • Contracted several broker-dealers to obtain market pricing for brokered CDs
  • Executed trades with various counterparties to bring in brokered MMDA funds
  • Established relationships with Promontory to support reciprocal deposits to replace secured account relationships (both public and private funds) and reduce reliance on large deposits
  • Explored inter-bank relationships and bi-lateral lines
  • Revisited retail pricing strategy to ensure that funding would be stable even if regulators imposed rate caps

Management of Regulatory Restrictions

  • Identified limit on funds available from each source pursuant to regulatory order
  • Tracked all deposits that were at rates in excess of market
  • Built tools to track and manage deposit flows on a day-by-day basis
  • Fine-tuned collateral pledged to maximize available securities
  • Managed retail pricing strategy relative to FDIC limits
  • Identified other assets that could be liquidated at reasonable prices; developed contingency plan to put liquidation in motion if/when trigger events occurred