ABA Banking Journal - October 2008 - (Page 56)

Tech topics ed to recover,” says Davidson. “Yet with oil prices, layoffs, and the stress that the financial services sector is under right now, it’s hard to know how the secondary market will work and what types of products will become more widely used.” Davidson says that there could be a role for automation in a market trying to right itself and avoid foreclosure via “haircuts, workouts, and new arrangements.” “There really aren’t any vendor systems that can support a bank handling any volume of client workouts.” Offering an example, Davidson talked about case management systems that banks could use where the bank cuts interest rates to keep the homeowner in residence but shares upside potential down the line when the property is sold. “That’s the sort of workflow and reporting tools the market could use now,” says Davidson. Not everyone sees IT as a savior in hard times. Some say bankers will remain leery of automated scoring and application approval during this more conservative period, one that requires a personal touch in application review. But one vendor, Overture Technologies, Bethesda, Md., sees this period as offering greater opportunity for expanding the use of rules and instant decision engines. It has coined a term “redecisioning,” for the act of re-executing an automated decision with fresh information at any time during the servicing period of a loan. “It’s conceivable to us that a loss mitigation clerk working with an application service provider (ASP) version of our Mozart system could be walking a consumer through the workout process, in a clear, consistent, repeatable way,” notes Linda Simmons, senior vice-president, business development. Case in Point Looking for sales in all the right places hree years ago, First Citizens Bank and Trust set its branch sales goals by blending art with science with the use of the Perform system by Pitney Bowes MapInfo. The $7 billion assets bank, based in Columbia, S.C., is an orthodox, consumer-focused bank with a solid base of small business customers that operate in the region. Heading into its current budgeting process, managers who used to be skeptical that a mere application could come up with the “right answers” are fine with it—even inclined to make fewer manual adjustments to annual sales goals. Today, decisions are based on a statistical analysis of a given trade area in addition to employee knowledge of the market’s potential. Branch environments, micro markets, and customer data are evaluated and used to group branches into peer segments for comparison of performance. Baseline performance expectations are established along with the ability to rationally assign goals based on profitability, attainment cost, and risk of failing. “The technology has really helped us look at the trade areas T Currently, the firm is developing pilots in the higher education sector in which it also operates to test the viability of “a mortgage origination-like process” applied in other types of lending scenarios. While she admits the servicing market is controlled, to some extent, by a few key vendors with aging IT, Overture’s product could, in effect, overlay any of those systems. “There really aren’t any vendor systems that can handle this volume of loan workouts” —Peter Davidson, Brooks 56 OCTOBER 2008/ABA BANKING JOURNAL Fate of e-mortgages? While automation efforts connected to Mortgage Industry Standards Maintenance Organization (MISMO) have continued and yielded some mature technology, aggressive moves to cut away paper from the lending process will remain a bastion of the largest, most prosperous leaders. Still, volumes of e-mortgages have crept up steadily prior to the correction, according to the Mortgage Bankers Association. Cleveland-based Amtrust Bank is a wholesaler that has closed over 10,000 mortgage loans using its proprietary eSign closing solution, notes Steve Trayte, vice president, director of credit and technology. A mainstay on mortgage conference panels, Trayte (pronounced like “trait”) is FI Solutions one face of the definite, if under the radar, electronification movement. “Our originators may scan documents or leverage their online channel to gather Subscribe at www.ababj.com http://www.mapinfo.com http://www.overturecorp.com http://www.mismo.org http://www.mismo.org http://www.ababj.com

Table of Contents for the Digital Edition of ABA Banking Journal - October 2008

ABA Banking Journal - October 2008
Contents
Editor’s Column
A Banker's View of FHA's "Hope for Homeowners" Program
Snapshot: Branch Sales Sag to Ten-Year Low
Covered Bonds Gain Interest after GSE Takeover
ABA Chairman’s Position
ABA Resources
Hot, Web, and Green
Rethinking Segmentation
Still Pushing the Envelope
Keep Regulation Functional
Capital Windfall?
Mortgage IT: Not This Year's Hot Property
Case in Point: Looking for Sales in All the Right Places
Put Your BSA/AML Program into Shape
Mailbox
Banker’s Mart
To Advertise/Index of Advertisers
Remembering Joe Kizzia, Veteren Editor of ABA Banking Journal
100th Anniversary: Then & Now
The Economy

ABA Banking Journal - October 2008

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