Blog · Wallet share and penetration · Commercial banking
The complete lending-only relationship calculation on five borrowers, small enough to check by hand: the loan book with origination type, the deposit ledger and product holdings joined on the customer identifier, the lending-only test, the syndicate participation and the acquired portfolio flagged, the norm from the two full-relationship borrowers of the same size and sector, the value at norm for the lending-only borrowers, and the assertion that every borrower is in the master, so a reader can reproduce every figure and then run it on their own loan book and deposit ledger.
Lending-only is a join between the loan book and the deposit and product ledgers and a test per borrower, and on five borrowers the whole thing can be done by hand, including the two flags. This page works the join, the test, the flags, the norm, the value and the assertion.
| Borrower | Sector | Size | Exposure | Origination type | Relationship manager |
|---|---|---|---|---|---|
| A | Manufacturing | Mid | $8.2m | Direct | RM-04 |
| B | Real estate | Mid | $12.0m | Syndicated participation | RM-11 |
| C | Services | Mid | $5.5m | Acquired portfolio | RM-11 |
| D | Manufacturing | Mid | $6.0m | Direct | RM-04 |
| E | Manufacturing | Mid | $9.5m | Direct | RM-04 |
| Borrower | Operating account | Deposit balance | Treasury products | Card | Annual fees |
|---|---|---|---|---|---|
| A | No | $12,000 | None | No | $0 |
| B | No | $0 | None | No | $0 |
| C | No | $30,000 | None | No | $0 |
| D | Yes | $1,600,000 | FX, payments | Yes | $38,000 |
| E | Yes | $2,200,000 | Payments | Yes | $44,000 |
loan book customers ⊆ customer master: A, B, C, D, E all present. Holds.
Lending-only = active facility and no operating account and no treasury product and no card and deposits under $50,000
| Borrower | Lending-only? | Flag |
|---|---|---|
| A | Yes | Direct: on the list |
| B | Yes | Syndicated participation: excluded |
| C | Yes | Acquired portfolio: review |
| D | No | Full relationship |
| E | No | Full relationship |
Same cell: mid-sized manufacturing with an operating account.
Median deposits = median(1,600,000, 2,200,000) = $1,900,000 Median fees = median(38,000, 44,000) = $41,000
| Borrower | Exposure | Deposits at norm | Fees at norm | Reading |
|---|---|---|---|---|
| A | $8.2m | $1.9m | $41,000/yr | The bank carries the credit; another bank has the operating relationship |
| C | $5.5m | not valued until reviewed | RM-11 to say whether reachable | |
| B | $12.0m | excluded | Not a relationship |
| Relationship manager | Direct lending-only | Exposure | Value at norm |
|---|---|---|---|
| RM-04 | 1 (A) | $8.2m | $1.9m deposits, $41,000 fees |
| RM-11 | 0 direct; 1 review (C) | $5.5m | pending |
Lending-only share of the loan book by exposure, direct only: 8.2 ÷ 41.2 = 20 percent. With B and C: 62 percent, which is why the flags matter.
Loan book and deposits never joined. A's exposure is on the credit report; A's absence of deposits is nowhere.
B counted. The list's largest line is a facility the bank bought a piece of.
C valued at norm. $1.9m of deposits at a borrower the relationship manager has never met.
Norm from a benchmark. Deposits per borrower from a survey; D and E are what this bank achieves.
The same join, test and flags per borrower, the norm per size and sector cell, per relationship manager. Covirage runs it on the loan book, the deposit ledger, the holdings and the master every quarter. The lending-only guide covers the measure, and the cross-sell measurement guide covers the product-count view it is the sharpest case of.
Because the bank bought a share of another bank's facility; the borrower has no relationship with this bank and never will through that facility. It is real exposure and not a cross-sell opportunity, and the origination type on the loan record says so.
Because a borrower that came with an acquired book may or may not be reachable: the relationship was with the seller. It is flagged for the relationship manager to say, rather than excluded by rule, and it is not valued at norm until they do.
At five it is two; on a real book it is every borrower in the size and sector cell with an operating account, as a median, with the cell's count shown and greyed under the floor. Here the two full-relationship borrowers, D and E, give the medians.