The Value Proposition

Expanding High Net Worth Client Credit Revenue

By:
Mark S. Johnson
404.909.5167
markstephenjohnson@comcast.net
Success in this Endeavor Requires A Unique
Leadership Profile
Extensive sales
Loss Prevention leadership
background
Credit Structuring Skills Typical combined with
Credit
Officer extraordinary
credit skills

Typical

Revenue Production
PWM
Sales
Leader

Credit Production Skills

 Increasing Profitable Low Risk
Capital Deployment
$$$$

$$
Future Active
Lending Markets
Additional Profitable Commercial
$ Lending Market Banking
* Private Lending- Institutional
Family Office Clients
Typical Bank Non-Profit
Lending Markets *Non-Bank
Multi-Family Banking
* Commercial Banking Offices Private Banking
*Commercial RE
* Institutional Non-Profit
*Investment Only
Providers Family Office
* Proprietary Private
Banking
(Local, regional and Private
national clients)
$$$$$$$$$$$ Lending
$$$$$$$$$$$
Loan Funding Sources
$$$$$$$$$$$
$$$$$$$$$$$
Extraordinary Bank Credit Revenue Generation
Through Strategic Partnership with Non-Bank Private Wealth Service
Providers

Four Key Concepts

Observation of Client Financial Behaviors by their Advisors
Credit Strategy Design that is Complimentary to Family Planning
Strategies Employed
Delivering Credit Strategy that Provides Economic Benefit that can be
Measured
Ongoing Bank Management reinforcement of the first
three within the Outside Advisor Community
 Observable Financial Behaviors
Front line advisor recognition and understanding of this concept is key to credit
extraordinary production and growth

Private Wealth clients pervasive belief:

I'm rich and liquid, why would I borrow money

Showing Them an Alternate Route to their Original Financial Solution that Provides
Quantifiable Economic Benefit (QEB)
Through the use of Strategic Credit is the

Key
 Re-action vs. Pro-action
In the Private Space, Advisors can produce
Advisors are often extraordinary results by
focused on fee income expanding that focus to
and they often only react include generation of net
to client defined credit interest revenue by
needs creating client needs
Extraordinary credit revenue growth is available in opening or expanding this market of the underserved
clients of Family Office and Investment Management only firms. Helping their Advisors to first
recognize there is one and then helping them :

to the clients originally defined financial solution is the key

 What am I talking about?
Left on their own high Net Worth clients will almost always use
cash or liquidate investment assets to fund these activities

Liquidating AUM to fund a variety

of activities where QEB can be
derived through a Strategic Credit
Structure
Transferring less than maximum
potential value when using GRATs
Using long term mortgages to fund
typically shorter term residential
purchases
Losing the step up in basis when
gifting assets
Funding high dollar life insurance
policy premiums through cash flow
or AUM liquidation or borrowing
within their policies
Funding for their Family Bank with
AUM or cash Transfers

All of theses typical high net worth client behaviors lead to

unnecessary client AUM or client cash flow reductions. QEB can be
provided to the client through a Strategic Credit structure in each case
 High Net Worth Client
Credit Revenue Sources

~70%
Increasing
Family Advisors
Recognition
That a Credit Strategy
Could Provide QEB
(Family Bank Funding, High $ Insurance Policy Funding,
Support for Gifting Strategies, Support for Private Investment Activity)

~30% Client Realization of Credit Needs

(typically residential mortgages, smaller consumer oriented credit lines
and asset purchase loans)
Whatever a banks current private wealth client credit revenue level it can more than double with
the establishment of strategic partnerships with non bank Family Office Providers
 Characteristics of the Leader You Choose
Deep knowledge Strong Family Office & Extraordinary
Investment
Deep Private Client Keen Observation of Creative Private Client
Deep Credit of Private Client Strategic Credit Management Revenue Gains
Entity Structural
Structuring and Behaviors Alternatives Community Contacts
Underwriting Skills Understanding
The
Years Years of Years of Years of Multiple contacts development
experience in experience observing the formulating within the of additional
the Private structuring financial lives credit Family Office and net credit
Lending and selling of High Net structures to Non-Bank spread
market credit facilities Worth (HNW) provide affiliated revenue by
to and Ultra HNW typically Investment opening a new
complement clients unthought-of Management high net worth
the planning of alternative community and ultra-high
and entity credit to serve as net worth
strategies of solutions to market will
the initial prospects
HNW and Ultra HNW and Ultra drive
to take advantage of extraordinary
HNW clients HNW client
financial the stable and profits
behaviors creative lending
platform
The bank can offer
their clients

If youd like to discuss the topic further dont hesitate to

contact me at (404.909.5167)