Chemical Banking Corp. and H.F. Ahmanson & Co. have installed profitability measurement software that runs exclusively on personal computers.
The software, from Treasury Services Corp., enhances the Santa Monica, Calif.-based company's existing line of asset/liability management systems. It is designed to improved the way banks measure the profit performance of their business units, customer segments, and product groups, company officials said.
The market for such systems has heated up during the past two years, as financial institutions grappled with giving management a clearer picture of income streams' sources. Several technology companies have profitability systems on the market, including Electronic Data Systems Corp., Plano, Tex., Hogan Systems Inc., Dallas, and Newtrend, Orlando, Fla.
A survey by Price Waterhouse says most financial institutions with more than $3 billion in assets have installed some sort of profitability measurement software but that few are satisfied with the results.
Many of these systems run on mainframe computers. But at least some bank financial officers said they would prefer to use more of the ever-increasing power of PCs, instead.
"Since I hold no power over the [mainframe] data processing people," said an East Coast banker, who wished to remain anonymous, "it's no small feat to get them to do a report for me. By the time all the approvals come down, you get what you wanted two years ago."
The Treasury Services software focuses on cost management. At Chemical and Ahmanson, it uses statistical data downloaded from mainframe general ledger and customer account files to a personal computer. The PC user then can turn the data into customized reports that analyze the profitability of something as large as a business unit or as small as an individual customer account.
An important feature of the system is its ability to help bankers optimized profits by advising them how to allocate costs most effectively, bankers said. Using high-performance PCs, the system can process 400,000 records per minute, Treasury Services officials added.
"The advances in relational data base technology, coupled with personal computer advances, are what allow this software to be so effective in a personal computer environment," said John Dorman, president of Treasury Services.