OFFICIAL PUBLICATION OF THE MONTANA INDEPENDENT BANKERS ASSOCIATION

Pub 8 2020 Issue 2

finquant-not-fintech

Finquant, Not Fintech: Why Bankers Healthcare Group Prioritizes Data To Create A Better Bank Loan Offering

In the months since the COVID-19 outbreak erupted in the United States, the lending market has seen a significant amount of disruption. At a time when banks would have been focused on loan volume and building their income streams, many shifted their attention to the Paycheck Protection Program (PPP) to support local business owners.

Paired with the recent news that mortgage rates have reached a record low, many banks are considering new ways to build and diversify their loan portfolio. Historically, community banks would consider alternative lenders or FinTech’s competition, but now they’re looking at these partnerships as a way to strengthen their bottom line.

While partnering with nontraditional lenders has its benefits, it’s important to note that not all lenders who claim the “fintech” title have the same impact financially. These companies can originate loans with ease, but their real differentiator — and the ROI for your bank — is in their historical data.

Loans Backed by Data and Insights

One well-established alternative lender, Bankers Healthcare Group (BHG), sets itself apart from FinTechs by carving its niche as a financial quantitative service company, or FinQuant for short. The company has been originating loans for community banks for nearly two decades, targeting licensed health care practitioners and highly-skilled professionals — some of the highest-earning borrowers with top-tier credit scores in the country.

But BHG doesn’t stop there. The lender has built proprietary quantitative analysis models that leverage 19 years’ worth of its historical borrower data to uncover variables that dictate the risk associated with each borrower. Utilizing some of the brightest minds in analytics from top universities and companies, as well as 30 data vendors, BHG has gained unmatched insight into its borrower characteristics and performance by industry, and can quickly determine the performance potential and the price risk.

Not only does this data help inform future decision-making into who BHG lends to, but it’s also leveraged by BHG’s full-service, in-house marketing agency to execute highly-targeted campaigns to millions of professionals every day. Even within these industries, BHG is extremely selective: the company targets the top 20% of the strongest-credit quality health care and other highly-skilled professionals. This attention to detail originating on the front-side of their business gives BHG an unbelievable advantage to ensure they’re only lending to top-rated borrowers, which has resulted in over $6 billion in financial solutions to date.

Now more than ever, community banks are in a unique position to diversify their commercial loan portfolio and strengthen their bottom line. By choosing an established partner like Bankers Healthcare Group and joining the BHG Bank Network, they have peace of mind and can quickly put a growth plan into action.

FinQuant-Driven Results

Today, BHG works with more than 15,000 of these coveted borrowers each month, with a record of $429 million funding in Q1 of 2020. That trend continued into Q2, with phenomenal loan volume sold through the BHG Loan Hub, a state-of-the-art loan delivery platform for community banks.

This secure online system allows for daily sales and delivery of medical and professional loans while helping BHG service the growing loan demand from community banks. The platform includes various methods whereby a single loan or portfolio of loans can be purchased. It has been a highly effective distribution channel where a bank can approve the loan program and purchase loans according to its underwriting standards the very next day. New loans are posted each day, and, as with all BHG loans, a consistent, complete credit file is available for review prior to purchase.

Across the country, a network of more than 1,100 community banks get access to high-quality medical and professional loans — earning a solid 3-6.5% return — and over 19 years, no bank has ever taken a loss on the BHG Core Loan portfolio.

Characteristics of a Credible Alternative Lender

BHG prioritizes data, analytics, technology, sales, marketing, underwriting, compliance, speed and customer service to originate quality loans and, as a result, has become the No. 1 source for medical and professional loans. For community banks considering a partnership with an alternative lender, BHG emulates the characteristics to look for:

Track record of success

BHG has built a network of more than 1,100 community banks, providing access to the No. 1 source for medical and professional loans, which has resulted in over $600 million in interest earned since 2001.

Endless borrower data

With over $25 billion in underwritten loans, BHG can better predict through quantitative analysis the performance of borrowers, providing a stronger return on your portfolio.

Origination expertise

BHG has established a name for itself among top-rated borrowers through innovative and comprehensive marketing tactics, resulting in thousands of new loans originated each month.

Streamlined process

BHG offers consistent loan packages so you can quickly analyze complete credit files and make informed purchasing decisions with ease.

Innovative technology, concierge service

With a lending process driven by the right mix of technology and customer service, BHG offers an experience no other alternative lender can compare to.

Are you interested in learning more? BHG believes in the power of great relationships and encourages you to ask your partner banks if they have joined the BHG Bank Network, and if so, how much interest income they earned on their BHG loan portfolio. BHG is also happy to connect you directly with any of its partners in your specific state.

The Montana Independent Bankers Association 

This story appears in Issue 2 2020 of the Community Banker Magazine.

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