Independent Banker - July 2020 - 66

CONNECTIONS
" More and more in banking is about
data management. "
-Eric Sprink, Coastal Community Bank
management and help build a
proprietary AI-based BSA product.
In preparation for such a partnership,
Coastal Community Bank
brought on David Franklin as senior
vice president and data scientist architect.
" We had to hire someone that
speaks the language, " Sprink says.
" We have to have oversight. "
The community bank eventually
chose Neocova in St. Louis, Mo., an
artifi cial intelligence-based, application
programming interface-driven
(API) banking technology platform
designed specifi cally to support community
banks. The bank announced
the partnership in January 2020.
Sprink says they continue to see
milestones achieved from the partnership,
such as enhanced management
and utilization of that data management
for the bank and its customers.
" We're learning how to open new accounts
online with world-class fraud
prevention, including BSA, KYC [know
your customer] and CIP [customer
identifi cation program], " Sprink says.
The community bank is also experiencing
less costly, more effi cient fraud
monitoring, as the new AI-powered
capabilities reduce accounts fl agged as
false positives. Since only a small percentage
of fl agged activity turns out to
be truly fraudulent, this reduces staff
time reviewing those that are truly
suspicious. " It's a cost savings, " Sprink
says. " That means either you have fewer
accounts to review or, on the other
hand, it allows you to grow faster. "
The capabilities the community
bank is developing for BaaS will also
benefi t its regular banking customers.
" If you really step back, more and
more in banking is about data management, "
he says. " We hope to use
this technology to provide custom-fi t
solutions for our customers. "
'You've got to be all in'
While Sprink is proud of the bank's
progress to date, it's not been an easy
or fast journey. " It's taken us fi ve
years to get to this point, " he says.
" We'd put a toe in, then a leg and then
check with the regulators. We're still a
bank; we're still compliance-focused.
We can't just go zero to 60. "
Sprink has collaborated closely
with regulators, meeting with them
every 90 days and checking in with
them fairly often, sometimes weekly.
The community bank even takes its
customers to meet with regulators,
who have been generally positive
about its BaaS-related initiatives
While Sprink believes more community
banks should explore partnering
in digital delivery, he cautions
that they must have a vision. " Don't
just partner with a fi ntech without
identifying your specifi c needs within
their given strategy, " he says.
Sprink insists that Coastal Community
Bank's commitment has been essential
to its long-term success.
" You've got to be all in, " he says.
" We have raised extra capital at IPO
to support this long-term vision. A
whole ecosystem has to be built. Your
policies and procedures have to be
updated; your liquidity has to be updated.
You have to lean in and hire the
resources, and you have to communicate
with everybody, often. "
Judith Sears is a writer in Colorado.
Independent Banker - July 2020

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