Banks’ prices for treasury management services moved higher in 2011, according to the annual Blue Book survey from Phoenix-Hecht. The average list price rose 1.8%, putting it a little above last year’s 1.5% rise in consumer prices, and discounting declined a bit, to 44%, down from 45% last year.
“The banks seem to be in a little bit better position to get prices that they would like to see,” says David Bochnovic, executive vice president at Phoenix-Hecht.
For the first time, Phoenix-Hecht collected data on the earnings credit rate (ECR) banks apply to corporate customers’ balances in non-interest-bearing accounts and found rates ranging from 0.01% to just over 1%, with the biggest chunk of ECRs falling between 0.20% and 0.35%. “There are a lot of ECRs out there, even from the same banks,” Bochnovic says.
The survey also suggests credit providers are wielding a little more influence over companies’ purchases of cash management services, at least at smaller businesses. Almost 62% of companies with revenue of less than $500 million say they would expect to move cash management business to a new bank that gave them a credit package, up from 54.3% in 2010 and 53% in 2009. Among larger companies, just 34.3% would expect to move cash management business, up from 31.9% in 2010 but down from 43.6% in 2009.
You can see a summary of the Blue Book here.