First Niagara was arguably a beneficiary of the financial storm that had many banks over a barrel, making quick acquisitions that doubled its asset size from $9 billion to more than $20 billion and its shoe size from New York state to Pennsylvania, expanding from a community bank to a top 30 bank by market capitalization in about a year.

But the honeymoon was short for First Niagara, which had to figure out how to optimize thousands of new relationships and dozens of branches on the fly or risk loosing accounts to myriad competitors.

To manage its new size, the institution recently licensed a pair of SAS products—SAS Activity-Based Management and SAS Profitability Management. The bank is using SAS Activity-Based Management to model costs, activities, processes and behaviors, while the profitability piece calculates profit and loss for each of its one million customer accounts, branches, products or a combination of the above in an effort to align resources for price optimization, capacity utilization and other process improvements.

Trevor Gee, a principal in the bank technology practice at Deloitte Consulting, says when a bank grows rapidly, building a process that can optimize cost, customer information and profitability while cleaning data from different silos at different institutions is "almost like starting from scratch. You have to extract the data, you have to normalize the data and develop standards."

In the past year, First Niagara acquired Philadelphia-based Harleysville Financial for $237 million, a deal that added $5.6 billion in assets. First Niagara also bought 57 former National City branches in western Pennsylvania from PNC, which added about $4 billion in assets—in an all stock deal worth about $150 million.

David Wallace, a manager for SAS, says Profitability Management has the ability to leverage cost analysis from Activity-Based Management to scale cost allocations across increasingly larger volumes of transactions, customers or business units.

Brent Bahnub, director of business intelligence for First Niagara, says that within six months, the bank improved its pre-tax bottom line by a little over $1 million and expects to increase this improvement by five times over the next 18 months.

There are a lot of tech options to help banks manage fast growth and data management through acqusition, such as IBM's Information Framework, and solutions from Oracle, MicroStrategy, HP and other vendors that sell business intelligence. Most of these solutions are part of a move toward centralized data governance to manage the quality of data across and optimize its use for CRM, risk, resource management and other purposes.

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