Customers

Solutions for the Financial Services Industry

The demand for financial and banking-related services is closely tied to economic activity and the level of interest rates. Financial Institutions such as; commercial banks, savings banks and/or credit unions, organizations are operating in a highly concentrated industry where large economies of scale offer new opportunities such as industry consolidation and automation. Smaller financial organizations tend to compete successfully in segments where customer service or knowledge of the local market is more important.

Given the competitive nature of the industry and the continuous challenges on financial institutions, organizations require a best-in-class performance management solution to mitigate risk and manage the micro and macro industry factors such as regulations, global operations, industry automation, customer service and changing leading economic indicators (prime loan rate, personal income). These factors can affect the profitability and the financial stability of the organization on a daily basis and need to be continuously monitored to assure challenges are managed and positive financial measurement is successfully achieved.

Why PROPHIX for Financial Services

The PROPHIX suite of performance management solutions enables financial institutions to focus on the bottom line and improve operational inefficiencies. New opportunities are easily discovered and market and customer value becomes enhanced. Organizations begin to measure product and service line profitability, evaluate different revenue lines, streamline operations, produce vital reports, efficiently consolidate data and improve cost inefficiencies. PROPHX delivers the means to start understanding overall financial performance and the true health of the organization.

Financial service organizations use PROPHIX Performance Management software and services for:

Measuring product/service line profitability

• Analyze and compare major product/service lines: bank loans, account services, brokerage services, credit card and leasing services, trust management, and investment services
• Understand the true costs of servicing customers: administrative expenses, personnel expenses, occupancy expenses, etc.
• Discover seasonality and trends to better manage product and service mix

Accurate revenue evaluation

• Evaluate different revenue lines from key revenue sources such as interest income, investment activities and service fees
• Identify factors affecting revenue, for example exposure to interest rate change and fluctuating personal income
• Explore and measure new revenue opportunities (specialty services, expansion to non-bank services) without compromising data integrity

Streamlining operations

• Manage interest rate instability by running interest rate shocks and scenarios to determine risk exposure
• Measure the quality of loans and investments and their timing differences in the maturity of loans and deposits; implement risk and liquidity management
• Forecast service and loan production and understand the true effect on income and the balance sheet

Balance sheet forecasting

• Generate detailed balance sheets that clearly identify assets (various loans and investments) and liabilities (deposits and borrowings)
• Continuously monitor assets to understand risk and how much liquidity the financial institution has in securities
• Analyze key balance sheet ratios such as the equity multiplier (asset/equity) to measure how many times a dollar of equity is leveraged

Consistent, reliable reporting

• Create detailed transaction reports illustrating ratios and yields utilized along with pertinent supporting details
• Produce and automatically distribute formal financial statement reports to key management and external stakeholders
• Make use of inherent OLAP reporting to slice and dice and drill down on information when analyzing reports and key data

Precise consolidation of data

• Take advantage of embedded organizational logic through tree structure roll-ups; easily adapt and change the structure through drag & drop or import processes
• Support a network of multiple branches/locations/entities by automatically consolidating data and running essential business processes
• Plan for alternative bank locations and unexpected industry consolidations through alternate roll-up and consolidation scenarios

Improved cost efficiency

• Control and manage labor costs associated with both hourly and salaried employees
• Eliminate and plan for job redundancy as new technology replaces certain tasks and banking processes
• Measure and account for capital expenditures associated with large computer technology investments

Financial Services Resource Center

Download the State National Bank Case Study