Menard Bank’s customers are its greatest asset—and top priority. For CEO Monte Lyckman, this means, among other things, that the bank should never turn down a depositor.
A cornerstone of its Central Texas community for over 100 years, Menard Bank provides financial support and guidance to area businesses and ranchers, as well as the county, school district, youth baseball league, volunteer fire department, and other local organizations.
The bank has always had strong capital levels and a solid deposit base, but when an existing customer transferred over their business account from a large regional bank, Menard essentially doubled in size, growing from approximately $46 million in assets to about $93 million in one year.
“Talk about your capital-to-asset ratio dropping,” Monte says. “We were thinking we’d have to inject money into our capital and pay more in FDIC insurance. We were considering offering more stock and borrowing from TIB Bank, but obviously there are some expenses associated with those options.”
“Basically, we were looking at a balance sheet that didn’t even look like ours.” adds Virginia Hill, Menard’s vice president of operations. “And it felt like the change happened overnight.”
Yet, Monte and Virginia knew turning the customer away wasn’t an option.
Shortly thereafter, Monte heard from another banker who was facing a similar challenge at his institution. That banker told Monte to call IntraFi®, so he did.
Menard Bank used IntraFi’s solutions to move the depositor’s funds off-balance sheet by selling them to other banks in IntraFi’s network of financial institutions. As a result, Menard was able to lower its total assets from around $93 million to $63 million.
“Taking that money off our balance sheet has been a godsend,” says Monte. “Our capital ratio went back up, and all the little things that the Fed examiners look at improved. In fact, we just had a state exam, and we did really well.”
Meanwhile, Menard is earning fee income on the transaction. More importantly, it has been able to maintain ownership and control of the customer relationship. But that’s not all.
“The customer has access to FDIC insurance on 100% of its funds, which they’re thrilled with,” Monte says. “They didn’t get that at the regional bank.”
But the cherry on top? IntraFi’s customer service. “Administratively, IntraFi made it really easy for us,” says Hill. “The whole process was so quick and seamless. And every time I call IntraFi, whoever I speak with is terrific.”
Based on its experience so far, Menard Bank aims to continue the partnership for years to come.