Banc One Corp. has contracted to install loan documentation software from CFI ProServices Inc. throughout its affiliates.
Officials at Portland, Ore.-based CFI would not disclose the amount of the contract, but said it was worth millions of dollars.
The software, Laser Pro, guides users through a series of questions to determine which federal and state laws apply to the commercial or consumer loan being processed. It then automatically prints out the forms needed for regulatory compliance.
79 Affiliates I Involved
Banc One declined to comment on the deal. But Matt Chapman, CFI's president and chief executive, said the Columbus, Ohio-based banking company is installing the software in all 79 affiliate banks in the 12 states where it operates.
Laser Pro is designed to improve the speed and accuracy of loan processing while ensuring compliance with the maze of state and federal laws. It's a workstation-based product that is used with a personal computer and a laser printer.
Laser Pro promotes consistent systemwide control of lending policies," Mr. Chapman said. "We automate the business process and, in the course of doing that, we implement the regulatory issues and the bank's own policies."
To Do Maintenance, Updating
He said that Banc One, with $76 billion of assets, is initially installing a DOS version at some bank units and will move eventually to an OS/2 version.
Under the terms of the contract, CFI will maintain the software and update it two or three times a year, said Mr. Chapman. In addition to the initial contract fees, Banc One will continue to pay CFI an amount based on the volume of loan transactions.
To stay abreast of the changing regulatory environment, CFI retains independent counsel in all 50 states who report relevant legal information to its in-house lawyers.
Laser Pro may also be updated to incorporate processing of new loan products and other changes in the policies of an individual bank.
Banc One is the most recent of about 2,000 banks to install the software. Other large banks using Laser Pro include First Interstate Bancorp, Los Angeles, which recently moved to implement the software bankwide, and U.S. Bancorp, Portland, Ore.
Barnett banks Inc., Jacksonville, Fla., began using the software in the summer of 1992 for its affiliates' small-business lending. According to Eric Sadow, senior counsel, the goal was to limit the use of outside lawyers and standardize loan documentation. "The overall intent [was] to reduce the cost to our borrowers and to speed up the closing process," he said.
To Be Phased In
"It worked very well for us," Mr. Sadow added. Barnett plans to use Laser Pro for all of its corporate loans. It will be phased in next year in Barnett's six largest affiliates, which process the majority, of the company's loans.
Many community banks also use Laser Pro, including FWB Bank in Rockville, Md. "It's a super product, and I think it gave us some competitive edge in technology," said Kim Yashek, senior vice president and controller. Before the bank brought in Laser Pro five years ago, it used software that required pre-printed forms.
"We chose the software because it automated our whole loan documentation" process," she said.
CFI officials said it will post sales of $26 million in 1993, up from $15 million last year.
Mr. Chapman said he views the contract with Banc One as a long-term partnership. "I think that is the real key to this contract. Banc One is very able to partner with people. There is a lot of discussion about this, but they really do it."
