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State Bank of Toulon | Needed Efficiency

The Challenge: Needed Efficiency

To meet strategic growth objectives while also maintaining headcount (critical to profitability in low-margin times) and mitigating underwriting risk, banks are looking for efficiencies within credit underwriting and review that allow their lenders to do more with less and to differentiate their bank from other alternatives. Brandon Yaklich, Commercial Loan Officer of State Bank of Toulon in Toulon, Illinois, said the institution faced similar challenges. They needed a tool to be more efficient.

Those narrative reports are what differentiates Abrigo from everyone in the industry. Everyone else uses bank-speak, but they don’t provide anything to give back to the client that they are able to use and digest.
Brandon Yaklich, State Bank of Toulon

The Solution:

The bank implemented the Credit Analysis solution from Abrigo and relied heavily on the software's agricultural templates for loans to producers. The bank's portfolio was roughly 75% agricultural, so it was important to adopt a technology that took on the nuances of ag lending while still providing efficiency.

As part of the software, State Bank of Toulon also implemented the budgets, narrative reports, industry data, and projections that came with the solution. These features took the bank's usage beyond just spreading loans and into consultative relationships with its prospective and current customers.

The Result:
Big Customer Service without Big Time Commitments

Using Credit Analysis’ extra features, Yaklich explains, “I can say ‘Here are your last three years, here is your average yield for 40 acres for corn for this farm, etc. Do you expect to see these same yields on the ground this year? Is there anything additional you plan to do this year?’” Having these types of planning conversations with the borrower sets his institution apart from competitors.

In addition, the solution helps Yaklich easily generate a budget he can send home with the borrower and help him or her keep track of actions needed to stay on budget. “He takes it and shows the other 6 farmers what our bank gave them and how much of a grasp we have on his production. That is something that stands out.”

The software also shows average production and other information so they can use that data in consultations with customers. For example, one farmer initially was looking for a $150,000 loan, but Yaklich noticed in the historical financial data that the farmer had applied lime to his fields three years ago. Knowing that lime application was something needed every three years, Yaklich asked if the farmer intended to apply lime in the upcoming year and, if so, whether the loan application had taken that into account. He did, but hadn’t yet, so the initial $150,000 loan request turned into a $300,000 request.

Yaklich credits the technology's narrative analysis for making a big difference for the institution. “We were in the top 5% in the country for commercial loan increase and demand.”

They have everything they need to know because of this report....[It] isn’t just a sheet with a lot of numbers on it; it actually has salient information on it. We can show heads of cattle, soybeans, corn, etc. the borrower may have. The FDIC is happy. Internal regulators are happy. Everyone is happy on that side.
Brandon Yaklich, State Bank of Toulon
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