Exciting times are ahead of us,” predicts Boris Sestan, data analytics supervisor at the $1.2 billion-asset Colonial Savings in Fort Worth, Texas. He says it was “a natural progression” for Colonial to get into data analytics as it became aware of the sheer amount of customer information contained in its systems.
Analyzing all the data a community bank holds can help automate certain proven banking practices, such as when an agricultural lender includes crop price forecasts when underwriting loans.
But data analytics is about more than putting together spreadsheets for individual loans. In its most inclusive sense, it means using information from both inside and outside the bank to boost sales, streamline services and create more targeted marketing. That said, developing expertise in data analytics can be tricky for institutions. Customer information is often spread across a number of different databases within a bank, and the formats may be incompatible with one another. This is because many banks have several legacy databases created in different formats, along with reports generated from that information using different types of “bolt-on” software.
Take it off your plate
Data analytics service providers do much of their work in this area. “The bulk of our efforts is getting data into shape to do analysis,” says Michael Le Lion, global client and partner director at Datawatch Corp., headquartered in Bedford, Mass. But once data are accessible, clients can perform their own analyses. “You can start small and grow,” he says.