Synovus Financial Corp. (SNV): Business Model Canvas [11-2024 Updated]

In today's dynamic financial landscape, understanding the business model of a key player like Synovus Financial Corp. (SNV) is essential for investors and analysts alike. This comprehensive examination of Synovus' Business Model Canvas reveals how the company effectively navigates the complexities of the banking sector through strategic partnerships, innovative value propositions, and a robust customer relationship framework. Discover the intricacies of Synovus' operations, from their diverse revenue streams to their commitment to community development.

Synovus Financial Corp. (SNV) - Business Model: Key Partnerships

Collaborations with fintech companies

Synovus Financial Corp. has actively engaged in partnerships with fintech companies to enhance its digital banking services. These collaborations focus on integrating advanced technologies that improve customer experience and operational efficiency. For instance, Synovus partnered with various fintech firms to streamline payment processes and enhance mobile banking capabilities.

Partnerships with local businesses

Synovus maintains strong relationships with local businesses throughout its operational regions. These partnerships enable the bank to offer tailored financial solutions that meet the specific needs of small and medium enterprises (SMEs). In 2024, Synovus reported an increase in loans to local businesses, with total commercial loans reaching approximately $34.84 billion, accounting for 80.8% of its total loan portfolio.

Relationships with governmental entities

Synovus has established strategic alliances with various governmental entities to facilitate community development and economic growth. These relationships often involve participation in public funding initiatives and economic development programs. For example, Synovus is involved in projects that support affordable housing and community reinvestment, reflecting its commitment to social responsibility and local economic support.

Alliances with insurance and investment firms

Synovus has formed alliances with several prominent insurance and investment firms to expand its service offerings. These partnerships enable Synovus to provide comprehensive financial solutions, including wealth management and insurance products. As of September 30, 2024, Synovus reported total non-interest revenue of $114.0 million from its financial management services, a significant portion of which is derived from these strategic alliances.

Partnership Type	Description	Impact on Financial Performance
Fintech Collaborations	Integration of digital banking solutions	Enhanced customer experience and operational efficiency
Local Businesses	Tailored financial solutions for SMEs	Commercial loans reached $34.84 billion
Governmental Entities	Community development initiatives	Support for affordable housing projects
Insurance/Investment Firms	Comprehensive financial services	Generated $114.0 million in non-interest revenue

Synovus Financial Corp. (SNV) - Business Model: Key Activities

Providing a range of financial services

Synovus Financial Corp. operates in multiple segments including Wholesale Banking, Community Banking, Consumer Banking, Financial Management Services, and Treasury and Corporate. As of September 30, 2024, the breakdown of net interest income from these segments is as follows:

Segment	Net Interest Income (in thousands)
Wholesale Banking	$546,836
Community Banking	$298,030
Consumer Banking	$410,506
Financial Management Services	$75,283
Treasury and Corporate	$(36,072)
Total	$1,294,583

Additionally, Synovus has a total loan portfolio of $43.12 billion, with the following composition:

Loan Type	Amount (in thousands)	Percentage of Total Loans
Commercial, Financial and Agricultural	$14,563,913	33.8%
Owner-Occupied	$8,100,084	18.8%
Investment Properties	$11,346,549	26.3%
1-4 Family Properties	$528,130	1.2%
Land and Development	$302,805	0.7%
Total Commercial Real Estate	$12,177,484	28.2%

Risk management and underwriting processes

Synovus actively manages credit risk through robust underwriting policies, routine loan monitoring, and stress testing. The provision for credit losses was $103.8 million for the nine months ended September 30, 2024, compared to $143.6 million for the same period in 2023. The allowance for credit losses (ACL) was $534.5 million as of September 30, 2024, down from $536.6 million at the end of 2023.

Period	Provision for Credit Losses (in thousands)	Net Charge-Offs (in thousands)
Three Months Ended September 30, 2024	$23,434	$27,100
Three Months Ended September 30, 2023	$72,572	$66,800
Nine Months Ended September 30, 2024	$103,818	$105,900
Nine Months Ended September 30, 2023	$143,607	$111,800

Customer service and relationship management

Synovus emphasizes customer service across its various banking sectors, focusing on relationship management to enhance client satisfaction and retention. As of September 30, 2024, total deposits reached $50.19 billion, with a significant increase in core deposits offsetting declines in brokered deposits.

Deposit Type	Amount (in thousands)	Percentage of Total Deposits
Non-Interest-Bearing Demand Deposits	$11,129,094	22.2%
Interest-Bearing Demand Deposits	$6,821,274	13.5%
Money Market Accounts	$11,031,502	22.0%
Savings Deposits	$983,171	2.0%
Total	$50,193,740	100%

Regulatory compliance and reporting

Synovus adheres to capital adequacy standards set by federal regulators. As of September 30, 2024, the Common Equity Tier 1 (CET1) capital ratio was 10.64%, reflecting a stable capital position amidst regulatory scrutiny. The total risk-based capital for Synovus Financial Corp. was reported at $6.53 billion.

Capital Ratio Type	Amount (in thousands)	Ratio
CET1 Capital	$5,107,668	10.64%
Tier 1 Risk-Based Capital	$5,644,813	11.53%
Total Risk-Based Capital	$6,529,260	13.49%

Synovus Financial Corp. (SNV) - Business Model: Key Resources

Strong capital base and liquidity

As of September 30, 2024, Synovus Financial Corp. reported a Common Equity Tier 1 (CET1) capital ratio of 10.64%, reflecting an improvement of 42 basis points from December 31, 2023. The total equity stood at $5.38 billion, with total assets reported at $59.59 billion. Total deposits decreased by $545.4 million compared to December 31, 2023, primarily due to a $937.6 million decline in brokered deposits. Synovus maintains a robust liquidity profile with contingent sources of liquidity totaling approximately $26.6 billion.

Experienced workforce of over 4,700 employees

As of September 30, 2024, Synovus employed a total of 4,728 full-time equivalent employees. The workforce is distributed across various banking divisions, including Wholesale Banking, Community Banking, Consumer Banking, and Financial Management Services. This experienced workforce is essential for delivering customer service and managing the diverse financial products offered by Synovus.

Technological infrastructure for banking operations

Synovus has invested significantly in its technological infrastructure to enhance banking operations and customer experience. The bank utilizes advanced banking software and digital platforms that facilitate online banking, mobile banking services, and secure transaction processing. While specific financial figures for technology investments were not disclosed, the ongoing enhancements to their technological capabilities are aimed at improving operational efficiency and customer satisfaction.

Diverse portfolio of loans and deposits

Synovus Financial Corp. has a diverse loan portfolio totaling $43.12 billion as of September 30, 2024. The composition of the loan portfolio is as follows:

Loan Type	Amount (in thousands)	Percentage of Total Loans
Commercial, Financial, and Agricultural	$14,563,913	33.8%
Owner-Occupied Properties	$8,100,084	18.8%
Total Commercial and Industrial	$22,663,997	52.6%
Investment Properties	$11,346,549	26.3%
1-4 Family Properties	$528,130	1.2%
Land and Development	$302,805	0.7%

Additionally, total deposits at Synovus amounted to $50.19 billion, with core deposits growing by $392.1 million compared to December 31, 2023. The loan-to-deposit ratio was 85.9%.

Synovus Financial Corp. (SNV) - Business Model: Value Propositions

Comprehensive banking solutions for individuals and businesses

Synovus Financial Corp. offers a diverse range of banking products tailored for both individual and commercial clients. As of September 30, 2024, the total loans, net of deferred fees and costs, amounted to $43.12 billion, with the composition primarily comprising:

Loan Type	Amount (in thousands)	Percentage of Total Loans
Commercial, financial, and agricultural	$14,563,913	33.8%
Owner-occupied	$8,100,084	18.8%
Total commercial and industrial	$22,663,997	52.6%
Investment properties	$11,346,549	26.3%
1-4 family properties	$528,130	1.2%
Consumer loans	$8,489,239	19.7%

Competitive interest rates and fees

Synovus maintains competitive interest rates across its loan products. The net interest income for the nine months ended September 30, 2024, was reported at $1.29 billion, with a net interest margin of 3.16%, which reflects the bank’s strategy to optimize yield while remaining competitive in the market. Furthermore, total average deposit costs stood at 2.72% in the third quarter of 2024, showcasing a proactive approach to managing funding costs.

Personalized customer service and financial advice

Synovus emphasizes personalized customer service, which is evident in their financial advisory services. The bank's financial management services generated $139.15 million in non-interest revenue for the nine months ending September 30, 2024. The bank's commitment to understanding client needs allows for tailored financial solutions, enhancing customer satisfaction and loyalty.

Commitment to community development and support

Synovus is dedicated to community development, which is reflected in its various initiatives aimed at supporting local economies. The bank has invested significantly in community development projects, contributing to a total of $200 million in community development loans and investments. Their involvement in the community also includes educational programs and partnerships aimed at promoting financial literacy.

Synovus Financial Corp. (SNV) - Business Model: Customer Relationships

Relationship-based banking approach

Synovus Financial Corp. adopts a relationship-based banking approach that emphasizes personalized service and tailored financial solutions to meet the specific needs of its customers. As of September 30, 2024, Synovus reported total assets of $59.59 billion, with a loan portfolio net of deferred fees totaling $43.12 billion.

Dedicated account managers for businesses

To enhance customer relationships, Synovus provides dedicated account managers for business clients. This personalized service is designed to foster deeper connections and improve client satisfaction. The bank manages a significant commercial loan portfolio, with commercial loans comprising approximately 80.8% of total loans, amounting to $34.84 billion as of September 30, 2024.

Loan Type	Amount (in billions)	Percentage of Total Loans
Commercial, Financial, and Agricultural	14.56	33.8%
Owner-occupied	8.10	18.8%
Total Commercial and Industrial	22.66	52.6%
Total Commercial Real Estate	12.18	28.2%

Online banking and mobile app support

Synovus offers robust online banking and mobile app support, enabling customers to manage their finances conveniently. The bank's digital banking platform facilitates transactions, account management, and customer service interactions, contributing to improved customer engagement. As of September 30, 2024, total deposits stood at $50.19 billion.

Community engagement and outreach programs

Synovus is committed to community engagement and outreach programs, which strengthen its relationship with local communities. The bank actively participates in initiatives that support economic growth and financial literacy. For example, Synovus has invested in various community programs, reflecting its dedication to corporate social responsibility. In 2024, the bank declared common stock dividends totaling $164.4 million, or $1.14 per share.

Synovus Financial Corp. (SNV) - Business Model: Channels

Branch and ATM network across multiple states

Synovus Financial Corp. operates a robust branch and ATM network across the Southeastern United States, specifically in Georgia, Alabama, South Carolina, Tennessee, and Florida. As of September 30, 2024, Synovus had approximately 300 branches and over 450 ATMs, providing convenient access to banking services for its customers.

Digital banking platforms for online access

In 2024, Synovus enhanced its digital banking capabilities, offering a seamless online banking platform that includes mobile banking applications. The digital platform reported over 1.5 million active online banking users, with mobile app downloads exceeding 1 million. This platform allows customers to manage accounts, transfer funds, and apply for loans digitally, which is increasingly important in the current banking landscape.

Telephonic banking services

Synovus provides telephonic banking services that allow customers to access account information, perform transactions, and receive assistance from customer service representatives. The telephonic banking service has seen increased usage, with over 500,000 calls handled monthly as of September 2024, reflecting a strong demand for personal assistance alongside digital services.

Wealth management and advisory services

Synovus offers comprehensive wealth management and advisory services, including investment management, financial planning, and trust services. As of September 30, 2024, the total assets under management (AUM) in Synovus' wealth management division reached approximately $12 billion, indicating a significant growth trend as clients seek personalized investment strategies in a complex economic environment.

Channel	Details	Metrics
Branch Network	Number of branches	~300
ATM Network	Number of ATMs	~450
Digital Banking	Active online banking users	1.5 million+
Mobile App	App downloads	1 million+
Telephonic Banking	Monthly calls handled	500,000+
Wealth Management	Assets under management	$12 billion

Synovus Financial Corp. (SNV) - Business Model: Customer Segments

Individual Consumers and Families

Synovus Financial Corp. provides a variety of financial products and services tailored to individual consumers and families. This segment includes personal banking services, such as savings accounts, checking accounts, personal loans, and mortgages. As of September 30, 2024, Synovus reported total consumer loans amounting to approximately $8.49 billion, which includes credit cards and other consumer loans.

Small to Medium-Sized Businesses

For small to medium-sized businesses (SMBs), Synovus offers comprehensive banking solutions that include business checking accounts, lines of credit, term loans, and treasury management services. As of September 30, 2024, the total loans extended to commercial and industrial clients, which include SMBs, amounted to approximately $22.66 billion. The bank actively focuses on fostering relationships with these businesses, providing tailored financial solutions that meet their unique needs.

Large Corporate Clients

Synovus serves large corporate clients with specialized banking services, including commercial real estate financing, investment banking, and treasury services. The total deposits from these clients were reported at approximately $13.66 billion as of September 30, 2024. The corporate banking division is vital for Synovus, contributing significantly to its overall revenue through fees and interest income from large-scale financing solutions.

Governmental and Non-Profit Organizations

In addition to traditional consumer and corporate banking, Synovus provides financial services to governmental and non-profit organizations. This includes public sector banking, grants management, and specialized lending products tailored for non-profit needs. The total deposits from this segment reached approximately $1.24 billion as of September 30, 2024. Synovus emphasizes its commitment to supporting community development through its services to these organizations.

Customer Segment	Key Services	Total Loans/Deposits (as of September 30, 2024)
Individual Consumers and Families	Personal banking, mortgages, savings and checking accounts	$8.49 billion in consumer loans
Small to Medium-Sized Businesses	Business loans, treasury management, lines of credit	$22.66 billion in commercial and industrial loans
Large Corporate Clients	Commercial real estate financing, investment banking	$13.66 billion in corporate deposits
Governmental and Non-Profit Organizations	Public sector banking, grants management	$1.24 billion in deposits

Synovus Financial Corp. (SNV) - Business Model: Cost Structure

Personnel and employee-related expenses

As of September 30, 2024, Synovus Financial Corp. reported a total of 4,728 full-time equivalent employees . The non-interest expense related to personnel costs for the nine months ended September 30, 2024, was approximately $938.2 million, with a significant portion attributed to salaries, benefits, and share-based compensation . Share-based compensation expense alone accounted for $24.2 million during this period .

Technology and infrastructure costs

Technology and infrastructure costs are critical for Synovus, particularly in enhancing their digital banking capabilities. In 2024, Synovus invested in various technology upgrades, which contributed to the overall non-interest expenses. The total non-interest expense for technology was part of the $938.2 million total for the nine months ended September 30, 2024 . Specific figures for technology expenses are not separately disclosed but are included within the total operational costs.

Regulatory compliance expenses

Regulatory compliance costs have seen an increase due to heightened scrutiny following recent banking sector challenges. For the nine months ended September 30, 2024, Synovus incurred regulatory compliance expenses as part of their total non-interest expenses, which reached $938.2 million . The company reported FDIC special assessment expenses and other compliance-related costs, although specific figures were not disclosed separately .

Marketing and customer acquisition costs

Marketing and customer acquisition expenses are vital for maintaining Synovus's competitive edge. While exact figures for 2024 are not disclosed, marketing expenses typically constitute a portion of the total non-interest expenses, which were $938.2 million for the nine months ended September 30, 2024 . The company has focused on enhancing its marketing strategies to attract new customers and retain existing ones in a challenging market environment.

Cost Category	Amount (in thousands)
Personnel Expenses	$938,200
Technology and Infrastructure Costs	Included in Total Non-Interest Expenses
Regulatory Compliance Expenses	Included in Total Non-Interest Expenses
Marketing and Customer Acquisition Costs	Included in Total Non-Interest Expenses

Synovus Financial Corp. (SNV) - Business Model: Revenue Streams

Interest income from loans and mortgages

As of September 30, 2024, Synovus Financial Corp. reported net interest income of $1.29 billion for the nine months ended September 30, 2024, which reflects a decrease of $84.9 million, or 6%, compared to the same period in 2023. The composition of the loan portfolio included:

Loan Type	Amount (in thousands)	Percentage of Total Loans
Commercial, financial, and agricultural	$14,563,913	33.8%
Owner-occupied properties	$8,100,084	18.8%
Total commercial and industrial	$22,663,997	52.6%
1-4 family properties	$528,130	1.2%
Commercial real estate	$12,177,484	28.2%
Total loans	$43,120,674	100%

Non-interest income from fees and services

Non-interest revenue for the nine months ended September 30, 2024, totaled $114.0 million. This revenue is generated from various fees and services, including but not limited to:

• Service charges on deposit accounts
• Fees from asset management and advisory services
• Brokerage and investment fees
• Trust services fees

For the three months ended September 30, 2024, the breakdown of non-interest revenue was:

Segment	Non-interest Revenue (in thousands)
Wholesale Banking	$14,945
Community Banking	$17,314
Consumer Banking	$18,978
Financial Management Services	$46,446
Treasury and Corporate Other	$26,297
Total	$123,980

Investment income from securities

Investment securities totaled $10.18 billion as of September 30, 2024, which reflects an increase of $388.0 million from December 31, 2023. The repositioning of the available-for-sale (AFS) securities portfolio contributed to this growth, with a focus on higher-yielding investments. The company reported net losses from sales of AFS securities amounting to $256.7 million during the second quarter of 2024, impacting overall investment income.

Asset management and advisory fees

Asset management and advisory services generated substantial revenue for Synovus, although the specific amount is not disclosed separately. However, it is included in the financial management services segment, which reported non-interest revenue of $139.2 million for the nine months ended September 30, 2024. This segment contributes significantly to the overall revenue stream through:

• Investment advisory services
• Wealth management services
• Trust management services

Overall, the diverse revenue streams from interest income, non-interest income, investment income, and asset management services position Synovus Financial Corp. effectively within the financial services sector.

Updated on 16 Nov 2024

Resources:

1. Synovus Financial Corp. (SNV) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Synovus Financial Corp. (SNV)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Synovus Financial Corp. (SNV)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.