The Benefits of a structured approach
The ARGOS Credit Process Management is a modular system that supports bank process and analytics. It focuses initially to the lending services of banks for Retail Clients and SMEs, but also for wholesale customers.
What are the business benefits of implementing a robust process flow management application?
1. Enhanced competitiveness and service differentiation:
a) Improved responsiveness of the bank to credit applications through a reduction of the application response time. Linked to an appropriate credit scoring/rating system the bank response can for certain products and activities be quasi immediate. In other cases the improved process flow will reduce bottlenecks and time between two processes.
b) Optimized use of a variety of distribution channels. This is particularly important for banks having large branch networks in large countries with limited access to remote areas.
c) One-to-one loan pricing to enhanced the client satisfaction within strict compliance of credit policies (see below).
2. Enhance credit management capabilities:
a) Implementation of a one-to-one risk based pricing on all products. By linking the credit approval analytics with pricing analytics in an integrated credit underwriting process the bank can individualize the credit pricing on a risk and relationship basis.
b) Strict compliance to the Bank’s Credit Policies and Procedures. The process flow will be managed in accordance with the bank’s approved procedures and with the banks policies (approvals…). The integration of the credit scoring/rating applications will allow a systematic compliance to the credit analytical models as specified in the Banks Policies.
c) The credit risk data generated by the systems (process and analytics) is focused on credit management and may be different than the capital adequacy models used by the bank, but they are reconcilable with the Basel II, Pillar 1 models .
d) The management of credit processes is an important step to compliance to Basel 2, Pillar 2 Internal Capital Assessment Process (ICCAP)
1. Enhanced operation efficiency: All the credit underwriting process are defined in a process flow applicable to all application and only differentiated when needed by market/client type.
2. The automation of the process flow results in improved control and reduced operational risk:
a) All processes can be tracked and controlled, allowing a better management of the operating capacity (bottlenecks, exceptions, resource allocations – – human and technical resources…).
b) An audit trail is generated for all transactions handled by the system.
3. The web based client server architecture allows the system to be implemented throughout the bank’s distribution network (branches, specialized departments, internet, mobile banking, third party sales partners…), with all the required controls and audit trails.
The next post will describe the process management requirements. If this looks like a sales brochure… guess what! Sorry for that but we have to earn a living.