Headlines:
More Consolidated Statements from Key Midwest Replaces E-Bill Pay Offering Conn.'s Liberty Bank Switches Processors New Web Platform for Ohio Savings Automated Trade Processing at Wells
More Consolidated Statements from Key
CLEVELAND - KeyCorp is expanding a program to provide consolidated monthly statements to customers who have complex relationships with the banking company.
Allyn Pytel, a senior vice president in charge of media and output management at KeyCorp, said the new system for "relationship statements" improves customer service and saves the company money.
"The statements are visually appealing and easy to understand, and they're very cost-efficient to produce," Mr. Pytel said in an interview Monday.
Key introduced the service in June for wealth management customers of its trust unit and its private bank. Executives plan to roll it out during the second quarter for people with "high-net-worth statements," such as brokerage customers and those who have both brokerage and deposit accounts.
The Dialogue package from Exstream Software Inc. of Lexington, Ky., allows Key to redesign their statements to reduce printing, paper, and mailing costs. The software also can generate pie, line, or bar charts and can insert marketing messages into space that would otherwise be blank.
Key is studying ways to make broader use of the technology, Mr. Pytel said. "We acquired the tool for a specific project. Now we're doing the evaluation [of] how much of a corporatewide implementation do we do."
The software has also enabled Key to start transmitting statements over the Internet. Mr. Pytel said that with very little marketing, about 20% of new customers are opting to receive statements electronically.
Douglas Jacomine, a vice president and the manager of the technology services division, said Key's technical staff is developing tools to give employees in the business units control over functions such as statement design and message targeting, "permitting the people who know the customer best to craft the statements."
Midwest Replaces E-Bill Pay Offering
BISMARCK, N.D. - Midwest Corporate Federal Credit Union is offering its member credit unions an electronic bill payment system from Mid-Atlantic Corporate Federal Credit Union of Middletown, Pa.
Douglas C. Wolf, Midwest Corporate's president and chief executive, said its clients could offer the payment service to their members or use it as a benchmark in shopping for such a service.
Midwest Corporate's agreement with Mid-Atlantic was signed in January.
The Mid-Atlantic system replaces one that Midwest previously offered from the Corporate Network eCom LLC subsidiary of U.S. Central Credit Union, Mr. Wolf said in an interview Wednesday. The new system should be more affordable for Midwest's member credit unions, mostly small and midsize one in the Dakotas, he said.
The offering includes neither Internet banking nor online bill presentment features. Mr. Wolf said he finds the market for presentment still undeveloped, though the new system could accommodate presentment in the future.
And the focused nature of the Mid-Atlantic system serves both credit unions that have existing online banking systems and those that do not, he said. "You don't have to have a home banking product," as long as a credit union has a Web page to link to the system.
Conn.'s Liberty Bank Switches Processors
MIDDLETOWN, Conn. - Liberty Bank, a mutual savings bank with $2 billion of assets, will add digital imaging capabilities after its switches its item-processing outsourcing to COCC, a mutually owned processor based in Avon.
The conversion is scheduled for completion by June 1, he said.
Robert M. Hoppenstedt, the executive vice president of personal banking at Liberty Bank, said the decision to change followed a formal review undertaken with the help of a consultant. Proposals from five vendors were studied, and the two finalists were COCC and Fiserv Inc., which had provided item processing to the bank since the mid-1980s, he said in an interview Tuesday.
"We were looking for a company that had the same strategic goals that Liberty Bank has - be small, be close to your customers, be good. Nothing against Fiserv," he said.
COCC, a company once known as Connecticut On-Line Computer Center Inc., provides processing services to 90 community banks in the Northeast, which own COCC.
Another factor in the decision was COCC's use of image-based fraud-prevention technology from Advanced Financial Solutions Inc. of Oklahoma City, Mr. Hoppenstedt said. "That will allow us to be more vigilant in a growing area of concern."
Larger institutions already have adopted more stringent check-fraud systems, in many cases chasing fraud artists to the next tier of targets, he noted. "We have to put on that protection because they're coming down the food chain to us."
New Web Platform for Ohio Savings
CLEVELAND - Having upgraded its online banking service, Ohio Savings Bank plans to raise the profile of its Web channel, which an executive admits has been allowed to languish.
Even so, Jo Ann Boylan, an executive vice president and the $12.8 billion-asset savings and loan's chief technology officer, said it does not plan to market the service as heavily as local competitors such as Charter One Financial Inc. and Bank One Corp. have done.
"It's not our lead offering. It is there to enhance our relationships with our customers and to deepen our offerings," Ms. Boylan said in an interview last week.
Less than 7% of Ohio Savings' retail customers - 40,000 of its 600,000 accounts - bank online, Ms Boylan said.
It moved its online banking service to a platform hosted by Online Resources Corp. of McLean, Va., instead of upgrading the one it had used from InteliData Technologies Corp. of Reston.
"It was never our selection to pick InteliData," Ms. Boylan said. Ohio Savings had introduced Internet banking several years ago and outsourced the hosting to the First Data Resources arm of First Data Corp., which sold that business to a company that InteliData acquired in 2001, she said.
"We never really migrated," and by the fall of 2001, "we reached a point in our relationship where we were going to have to do a forklift upgrade," she said.
Instead, Ohio Savings sent out a request for bids. After reviewing proposals from five providers, it decided to split its the Web site, moving the marketing portion in-house and migrating the transactional portion to Online Resources' hosted service.
One reason for the switch was that Online Resources handles its bill processing in-house, while InteliData, the other finalist, outsourced it to Princeton eCom Corp., Ms. Boylan said. "I was able to work with one vendor," she said. "That has streamlined the process."
Ohio Savings signed a contract with Online Resources in February 2002. The internal switchover was complete by December, but executives decided to wait until after the holidays to introduce the new Web site to account holders, she said. "Christmas time is not a great time to have your customers change their online banking system. They have other things on their mind."
Since the new site went live to consumers last month, "we've had a significant increase in new registrations," Ms. Boylan said, though Ohio Savings has yet begun to promote the upgraded service.
And even if e-banking is not a lead offering, "we know we have to have it be competitive," she said. "That's the starting point."
Automated Trade Processing at Wells
MINNEAPOLIS - Wells Fargo & Co. has automated the straight-through processing of cross-border securities trades in the trust division, and an executive says it plans to apply the same technology to other types of transactions.
Robin Reinfeld, a vice president of the division and the STP senior project manager for trust investment operations, said in an interview last week that the trust division records the transactions made by more than 800 outside money managers and transmits the information for settlement, Ms. Reinfeld said.
The division had spent one and a half years looking for an automated "workflow engine," to enable it to process transactions faster, at a lower cost, and with better risk management and monitoring, she said.
Executives had looked at a half-dozen alternatives before they encountered a Lawrenceville, N.J., company called Connextive Inc. last summer, Ms. Reinfeld said. "We were in contract negotiations with another vendor, and we put that on hold."
Connextive offered a graphical system that produces flow charts for modeling the trade process - a step that eliminates a lot of hand coding - and it has modules to speed an upgrade of Wells Fargo's Swift messaging to comply with a new technical standard called ISO 15022, she said.
The transition to ISO 15022 has proven so troublesome for the industry that the Society for Worldwide Interbank Financial Telecommunication extended its November 2002 deadline by six months so that institutions could make the change, she said. "We thought it was a huge thing that we made that deadline," Ms. Reinfeld said.
In trade processing, a major goal for Wells was to reduce the manual handling of exceptions, she said. For instance, if an investment manager fails to provide necessary details on a transaction, the new software can find it using data from internal tables and transmit it automatically, "versus a human being having to touch that trade and it being manual from then on."
The division wants to extend the STP enhancements to foreign exchange, mutual fund, and domestic trading as well, she said. "We're going to be phasing it in through next year."
