Not only the ongoing zero interest phase, but also increasing digitalization has presented sparda-bank nuremberg, to which the coburg branch also belongs, with entirely new challenges. "A very intensive year", board member markus lehnemann summed up 2017 at the balance sheet press conference in coburg. "An unbelievable amount has happened, we have changed a lot and opened up completely new areas of business."
First, as part of its "strategy 2030", the bank has had completely restructured the sales department. "Our advisors today are no longer generalists", said lehnemann. For a good year now, sales has been divided into the competence centers of member support and acquisition, investment and provision, and construction, housing and financing. "We need greater specialization, because advice is becoming more and more demanding", so lehnemann.
An "extremely attractive new business field" are cooperative financings with the goal of creating affordable housing, according to lehnemann. Last summer, sparda-bank was awarded the contract to act as advisor and financing partner for the "spiegelfabrik" cooperative housing project support in furth. "An owners’ association with 80 members that wants to build 54 mixed apartments on 3500 square meters", lehnemann explained. Further projects are already being planned.
Advancing digitalization is also having an impact on banking operations and the organization. "In 2017, for the first time, more customers used the sparda-bank app than the telephone.", lehnemann reported. This is astonishing, because the cooperative sparda-bank used to be a "telephone bank" been. Today, however, mobile banking via app is much more popular, he said. "Customers don’t call as often anymore, but if something doesn’t work, for example if their password is locked, they need help right away – around the clock.", lehnemann has observed. "That’s a completely different set of expectations."
Consultant live on screen
those responsible were also surprised by the response to the video advice service. The bank has been offering this service in construction financing for a year and a half now. During this time, around 400 inquiries had already been received via video telephony. This works much like the messaging service skype, lehnemann explained. The customer sees the advisor live on the screen. The customer can decide for himself whether the advisor is allowed to see him too.
The fact that such video calls are particularly popular on saturdays, sundays and friday evenings presented the bank with the next challenge. "Of course, these are times when no one can be reached at the branch," said lehnemann, said lehnemann. That’s why several "sparda" banks have joined forces, so that they can always offer a single point of contact. What also surprised bankers: "eight out of ten video customers never come to the branch. You call, see that a specialist is sitting there and not an employee of a call center and well! The rest will be done by telephone", lehnemann reported.
The core business of sparda-bank nurnberg, founded in 1930, is still private customers. "Our members need a cheap account", lehnemann knows. Even though the bank is foregoing around 8.5 million euros per year with the fee-free checking account, it wants to stick with it for the time being.
Money remains in the account
"customers want to invest money. With zero interest rates, it’s difficult, lehnemann admitted. He does not see an end to the low-interest phase. He fears that the previous ten years could well turn into 20. A side effect of the lack of interest: customer deposits in the accounts have risen sharply – in coburg alone by 5.4 percent to 109 million euro. "Customers used to have an average of 1,500 euros in their checking accounts, but today some have 8,000 euros." many customers see no need to invest their money if there is hardly any interest on it anyway.
The bank records a significant increase in its lending business. In 2017, the portfolio stood at 90.8 million (previous year: 87.2 million). In terms of construction financing, new business at the coburg branch in 2017 was slightly down on the previous year at 8.9 million euros (2016: 12.9 million). But the bank as a whole achieved strong growth in construction financing, from 397 to 425 million euros.
After the first quarter of the current fiscal year, it is already clear that 2018 will be an "outstanding year for construction financing the building cooperatives are shooting through the roof," says lehnemann!"