UMB Financial (UMBF) in Kansas City long has been an early adopter of technology. The diversified financial company says technology holds the key to improving banking for customers while lowering the cost of serving them.
The $15.7 billion-asset company, which recently celebrated its 100th anniversary, is moving to mobile transactions, experimenting with video banking and turning its personnel who deal directly with customers into "advisors," all with the goal of reconceiving the role of the 121 branches in seven states and 330 ATMs that make up its retail network.
"The reality is that you have to cut costs," Mariner Kemper, the bank's CEO, told American Banker recently. "We're using technology to enhance the customer experience."
Throughout its history, UMB has turned to technology to build its business. In 1928, the company opened what is thought to be the nation's first drive-up window. Sixty-even years later, UMB was among the first Midwestern banks to offer online banking.
These days UMB, which serves roughly 250,000 retail customers and about 20,000 small businesses, is counting on technology to meet the needs of an evolving mix of customers.
For the past year, the company has tested videoconferencing in three branches. Video links connect customers with a teller in the company's call center who can transfer funds, obtain copies of checks, update account information and handle other routine transactions. "The goal was to help customers feel more comfortable with the use of alternative technologies and also to transition more time-consuming transactions [offsite] to free up personnel in the branches for more value-added activities," says Christine Pierson, UMB's head of consumer banking.
"You could count on both hands the number of customers who didn't want to use it," adds Pierson, who says UMB expects to roll video banking out more widely this year.
The company also is taking steps to speed service and cut costs. One example: the company slashed by 75% the time it takes to review applications for small business loans after revamping processes for the bank's 10 most popular retail transactions. "That's a much better experience because customers get their answer back quickly and you've taken out waste along the way," Pierson said.
Kemper notes that many younger customers visit a branch solely to open an account. "What we're dealing with as an industry is a bridge between generations," Kemper said. "The younger generations will do everything through technology, and yet all banks have an older group of customers that still use the branch network."
For UMB, that means retooling its retail channels to meet a lifetime's worth of customers' needs. "We have to be there as bankers to help them through that process," says Kemper. "Otherwise, we'll just be left with a very expensive acquisition model."
Kemper says he read with interest a recent report by American Banker about how Wells Fargo is testing a branch prototype that would measure about 1,000 square feet and feature movable walls that convert private rooms to ATM vestibules. "I think that's kind of where everybody's head is," Kemper said of maintaining branches. "Not that you're going to get out of it. You just have to do it more efficiently."