Iowa Community Bank Hits in the Big Leagues of Digital Banking


Premier Bank, Dubuque, Iowa

For financial institutions, online and mobile banking are playing an increasingly important role for attracting and keeping customers. While these are areas often pioneered by larger financial institutions, Todd Link, Senior Vice President of Operations and Chief Risk Officer at Premier Bank in Iowa, believes that these channels can actually be the great equalizer for community banks.

Community banks, he argues, have often had the edge over larger banks when it came to personalized service. Now, due to more robust technology, the playing field has been further leveled.

“We can now go head to head with large banks on the technology front,” Link says. “The gap is not there anymore.”

Premier Bank has three branches in Dubuque, Iowa, and $250 million in assets. While the bank may be small by conventional standards, it doesn’t look small when it comes to a digital presence that impresses. The bank underwent an aggressive upgrade of its online channel in 2011, implementing a new web and online banking presence, adding mobile banking and other features like instant messaging capabilities for support.

The results?

  • A 9.5 percent increase in online bill-pay enrollment
  • A 56 percent increase in online bill-pay usage
  • A 400 percent surge in mobile banking customers
  • A 15 percent average monthly increase in online chat customers, helping reduce calls to customer service
  • Growth in e-statement usage to 76 percent of its online client base

One of the best results, however, was satisfying an increasingly tech-savvy customer. Before the upgrade, many of Premier Bank’s systems worked well from a technology and security standpoint but had a dated look and feel.

“Customers will grow weary of stale and outdated technology,” Link says. “They’re going to the app store and comparing what they get with their bank to some of the leading edge high tech apps on the market. They’re asking, ‘Why can’t my bank do something like this?’”

By analyzing customer behavior, it became clear to Premier Bank that its customers wanted the freedom to bank in a 24/7 environment – paying bills, transferring funds and conducting other transactions whenever and wherever they choose. Link says he needed an infrastructure that could handle this kind of behavior. The alternative was having customers lured away by larger competitors offering more up-to-date technology.

In terms of IM, while adoption has been slow, it is increasing every month, and Link says the capability provides value to customers who prefer this channel.

The more customers you convert to e-statements as opposed to receiving mail ... the more efficient your operations will be.

Further, mobile banking upgrades have improved customer satisfaction and loyalty, and e-statements have saved money on mail costs while reducing environmental impact of paper. Link also believes that decreasing the number of vendors has substantially reduced risk.

He maintains that community banks should not sacrifice on customer experience because of fear of technology as an expense. He says a better user experience and improved efficiency don’t have to be mutually exclusive objectives.

“Community banks can absolutely adopt technology that improves the customer experience and delivers efficiencies,” Link says. “The more customers you convert to e-statements as opposed to receiving mail, or instant messaging instead of calling the call center, the more efficient your operations will be.”

While it is clear to him that technology is leveling the playing field, community banks should be prepared to continue rolling out new technology-based services, and faster, than in the past.

“Our biggest challenge collectively as community banks is speed to market,” Link says. “If we continue to operate in a mindset and adopt technology at a snail’s pace, we’re going to be eaten alive by bigger competitors. We need to measure concept and deployment in days and weeks, not months and years.”

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