Savings mobilization marketing programs can help banks increase deposits and long-term profits. Raffle promotions, Kiddie Savers clubs, and public concerts were shown to substantially boost deposit levels. While many MABS member banks are profitable, opportunities still exist for all banks to improve further by mobilizing more deposits. Cultivating microdeposits provides long-term benefits to the bank through increased client relationships and expanded business opportunities over time.

1. Savings Mobiliza.on Marke.ng Programs
Ferdinand O. Sia
RBAP‐MABS
2011 RBAP‐MABS Regional Roundtable Conference
Hya= Hotel & Casino, Manila
November 9, 2011

2. Savings Mobiliza.on Marke.ng Programs
RBAP‐MABS Regional Round Table Conference
9 November 2011
2

3. Savings Mobiliza.on
Part I: Why culJvate microdeposits?
Part II: MarkeJng Programs for Savings
MobilizaJon
a. Raffle PromoJon
b. Kiddie Savers Club
c. Public Events
Part III: MABS Banks Performance
3

4. PART I: WHY CULTIVATE MICRODEPOSITS?
4

5. 1. Long Term View: Deposit balance increase over .me
PHP Deposit History of a Typical Depositor in 2000
70,000
58,978
60,000
50,000
40,000
30,000
18,730
20,000
8,260
10,000
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
• People’s income increase as they advance in the life cycle
• InvesJng in micro‐depositors will present long term benefits to the bank
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6. 2. Marke.ng Perspec.ve: Wide deposit base expand business
opportuni.es for the bank
• SomeJme in the future, a
depositor will need financial
services
• A deposit account presents an
opportunity to build a lasJng
relaJonship with clients
• Trust and good relaJonship make
it easier to offer other products
and services to depositors
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7. 3. Financial Impact: For banks with more loans than deposits,
more deposits translate to more income
In Million Loans vs. Deposits
PHP
800
Shortfall
700 funded with
Bills Payable
600
Loans at 9%
500
Potential
400 savings
Deposits
300
200 Savings
Account
100 only pays
1%
0
Jan‐04 Dec‐04 Nov‐05 Oct‐06 Sep‐07 Aug‐08 Jul‐09 Jun‐10 Dec‐10
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8. PART II: MARKETING MICRODEPOSITS
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9. a. Savings Booster Project: Raffle Promo.on
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10. Result 1: Deposits grew rapidly with promo.on
Deposit Balances (PHP mn) Deposit Growth Rate
205 15%
169 188
161 163 12%
10%
7% 8%
Before 18 Before 12 Before 6 During A^er 6 Before 18 Before 12 Before 6 During A^er 6
months months months months months months months months
No. Accounts 6,426 No. Account Growth Rate
11%
5,831 4%
5,641 5,606 5,686
‐5% ‐4% 0%
Before 18 Before 12 Before 6 During A^er 6
months months months months Before 18 Before 12 Before 6 During A^er 6
months months months months
Notes: (1) Growth rate is based on average of monthly year-on-year growth rates for the study duration.
(2) Deposits refer to voluntary deposits only.
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11. Result 2: More depositors par.cipated and their balances increased
Average Core Deposit Average Core Deposit Growth Rate
32,180 18%
31,914
29,671 12%
11%
29,105
28,556 8%
‐1%
Before 18 Before 12 Before 6 During A^er 6 Before 18 Before 12 Before 6 During A^er 6
months months months months months months months months
Proportion of accounts that qualified for raffle promotion
Savings Deposit 2008 2009 2010
(raffle year)
New Depositors 6% 5% 12%
Repeat Depositors 8% 10% 10%
Note: For comparison purposes, calculations were made on hypothetical proportion of accounts
qualified for raffle promotions for 2008 and 2009 as if raffle promotion existed in those years.
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12. b. Savings Booster: Savings Account for Young Depositors
• Target guardian and minor
depositors
• Establish relaJonship with
potenJal clients at very young
age
• AcJviJes and freebies make the
product more meaningful to
depositors
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13. Benefits from Kiddie Savers come in various forms
Short-term benefits:
Costs:
• Increase business with parents
• Lock box
• Earn public goodwill
• Freebies • Brand marketing
• Club activities
Long Term benefits:
• Marketing & Promotions • Kiddie depositors eventually
• Special administration
avail other bank products
• Overall customer loyalty
Investment Return
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14. c. Savings Booster: Public concert with celebri.es
• EffecJve in a=racJng new
micro‐deposit accounts
• Bank may ask for a
minimum deposit to serve
as entry Jcket
• Choice of celebriJes will
depend on the taste of the
local market
• Performers from local
market are equally effecJve
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15. PART III: MABS BANKS PERFORMANCE
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16. Good News 1: Majority of MABS member banks are more
profitable than the industry
25%
Selected Member Banks’ Profitability (2010)
N
20%
J
O
Return on Equity (ROE)
G
E
15% I
L
Universal and Commercial B
Bank Industry Rural Bank Industry
10%
Thri^ Bank F H
Industry A
D
K Higher than
5% C industry
Lower than
M industry
0%
0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 4.5%
Return on Asset (ROA)
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17. Good News 2: Opportuni.es s.ll exist to further improve
profits by mobilizing deposits
Small Banks Large Banks
0.9 3.5
0.8 Balanced Porjolio Line  Balanced Porjolio Line 
3.0
0.7
J
Deposits (in Php billions)
2.5
0.6 A
Deposit (in Php billions)
0.5 B 2.0
C K
0.4 1.5
E D L M
0.3 F 1.0
0.2 G N
0.5
0.1
I H O
‐ ‐
‐ 0.2 0.4 0.6 0.8 ‐ 0.5 1.0 1.5 2.0 2.5 3.0 3.5
Loans (in Php billions) Loans (in Php billions)
Most deposit-loan ratios are above 0.85
Note: Loans in this slide refer to gross loans.
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18. Summary
• Microsavings serve as long term investments to generate
funds for loans, obtain new clients and increase profits
• Raffle promoJons, Kiddie Savers Programs, and public
concerts can boost deposits substanJally for the bank
• OpportuniJes sJll exist among MABS member banks to
further improve profits by mobilizing deposits
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