By reducing servicing costs and associated correspondent fees, clients using Bankers' Bank Northeast can improve their income. In addition, our Fed Funds As Agent overnight program most often pays a higher rate on average than the competition. We also offer a unique program that can reduce your reserves. This is accomplished by decreasing the amount of transaction account balances that are subject to reserves by moving them into non-transaction accounts. Our International Services program offers financial institutions the opportunity to generate higher fee income than available through other correspondents.
Because we are able to secure preferred pricing and aggregate volumes, Bankers' Bank Northeast is able to effectively reduce the costs and/or fees associated with traditional correspondent services. In addition, clients are not subject to the standard 10% reserve requirements and we pay 90% of our average fed funds rate for the given month on all compensating balances versus the rates offered by large correspondents. The rate differential is often significant.
By using the various services offered through Bankers' Bank Northeast, clients are able to effectively consolidate multiple correspondent relationships and therefore simplify their day-to-day operations. This reduces many associated tasks including wire transfer activity, telephone calls, maintaining of multiple correspondent accounts; multiple targeted compensating balances, reconcilement activity, etc.
Improving Service Delivery
Bankers' Bank Northeast is able (because of the large volumes that we generate) to work closely with its various third-party vendors and implement enhancements and/or concessions that otherwise might not be available to any individual clients. In addition, we work very closely with each of our clients on a day-to-day basis. We quickly respond to proposal requests, research and problem resolution. We are bankers working for bankers.
Assisting With Liquidity
Our goal is to provide financial institutions with a flexible and reliable resource for their short-term liquidity needs. By using our Fed Funds Liquidity Line, it is our intention to offer a competitively priced unsecured line of credit, typically up to $2 million or more to qualified financial institutions.