Commercial Loan Pricing Strategies for a Dynamic Rate Environment
March 20, 2025After the Federal Reserve began cutting rates in 2024, many bankers anticipated a return to a positively sloped yield curve. Although recent economic data has moderated expectations for further rate cuts in 2025, the current environment is poised to enhance bank performance. Budgets for 2025 indicate increasing net interest margins, driven by both declining funding costs and rising asset yields. Loan yields are projected to continue climbing as higher new volume rates replace maturing loans at lower rates.
Join Forvis Mazars for a fast-paced webinar, where we’ll discuss recent industry trends in loan yields and deposit costs and provide a summary of 2025 budget forecasts. With all of these moving parts, maintaining discipline in commercial loan pricing is crucial. We’ll present real-life examples demonstrating that relationship pricing is not a one-size-fits-all approach. The mix of loans and deposits, along with the rates earned and paid on these accounts, can significantly impact the pricing of new loan requests.
Learning Objectives
Upon completion of this program, participants will be able to:
- Describe recent lending trends surrounding loan yields and deposit costs and understand how these trends impact the commercial lending landscape.
- Discuss the importance of discipline in commercial lending, especially in a dynamic rate environment.
- Recognize that relationship-based pricing is not an all-encompassing approach through real-world pricing examples.
- Explain how pricing models like LoanPricingPRO® can help support your institution in a shifting rate environment.
LoanPricingPRO®
Our strategic loan pricing tool can help your financial institution manage and grow your portfolio by factoring in the value of your existing customer relationships and help enhance your proposed loan terms with real-time profitability analysis.