Profitability Advisory Services

Every bank and credit union is focused on understanding its profitability—including the profitability of customers, departments, officers, channels and products. However, many of organizations lack the technical expertise, practical experience and, more importantly, adequate infrastructure to handle these types of calculations and analyses. These challenges are compounded by the necessity to train and educate executives and management in order to foster their adoption of profitability principles.

Our experts deliver an actionable profitability framework that pulls brings together funds transfer pricing (FTP) best practices, service transfer pricing and economic capital allocation practices to maximize profitability. The Kaufman Hall framework makes profitability measurement processes completely transparent, enabling stakeholders to have a clear picture of what's affecting costs and profits.

The result: insight that drives better decision making.

With an efficient approach to profitability management, banks, and credit unions can:

  • Calculate FTP to view the value created by funds users, funds providers, and interest rate risk managers
  • Support costing with rate/volume equations at the most granular level
  • View top and bottom performing products and services to identify areas for profit improvement
  • Apply cost factors that may have been estimated from cost studies or other means
  • Draw on profitability results to inform other areas of planning and incentive compensation management

This multi-tiered offering can include any or all of the following;

  • Methodologies
  • Analysis
  • Strategic deployment 
  • Auditing
  • Executive and management training