Bank of the West approves loans in one day with IBM ECM and BRMS solutions

Company Background

With more than 700 offices in 19 midwestern and western states, the US$67 billion-asset Bank of the West offers a full range of business, corporate, personal, trust and international banking services.

Challenge
As Bank of the West more than doubled in size, primarily through acquisitions, manual processes made it difficult to quickly and efficiently process commercial loans. Delays arose as applications were routed through approvals via interoffice mail. If during the credit review process, additional information was required, the documents had to be returned to the originating branch and then resubmitted. As a result, while the risk management team could typically respond to a loan application the same day it was received, approving loans could take nearly a week given the process delays.

Solution
Bank of the West implemented IBM® FileNet® eForms, IBM FileNet Content Manager, IBM FileNet Business Process Manager and IBM WebSphere® ILOG JRules business rules management system (BRMS) software to move from a manual, paper-based process to an efficient, automated paperless system. This integrated Enterprise Content Management (ECM), Business Process Management (BPM) and BRMS solution, uses active content via eForms to trigger business processes and it separates business rules from the processes themselves so the company’s Credit Administration team can update credit conditions, approval requirements and special approval privileges, without IT assistance. The result? An increasingly agile organization that can respond quickly to customer needs and changing market requirements.

With nearly 750 loan transactions processed through the system monthly, it was important that the eForms have the same look as paper forms so employee adoption was seamless. FileNet eForms and BPM software enable bank staff to complete loan forms online—populating borrower information from the loan accounting system into the credit request document—and then easily route the applications through credit review and approval.

This integrated ECM, BPM, BRMS system confirms each approver’s credit authority and requires certain critical data boxes to be completed before allowing the file to be saved and transmitted. Additionally, where permitted, it can identify overrides of declined credit decisions and creates the form for staff to justify and report on the override action. Upon credit approval or denial, an e-mail notification is automatically generated to advise business units of credit decisions and risk grade changes.

If credit reviewers need additional information, loan officers can immediately update the forms online and then instantly share the new document. This has helped eliminate lengthy delays due to interoffice mail and enabled staff to approve new loans the same day they are received when additional information is required. Previously this process could take up to a week when corrections and additional information were sent by interoffice mail. Additionally, the solution has helped streamline auditing and reporting processes. Risk management staff can now generate end-of-month reports of data collected by the system, including borrower industry, collateral and risk categories, for credit reviewers to evaluate. Before, each branch had to manually pull paper copies of the reports and then send them via interoffice mail to the risk management office for review.

The agile IBM ECM software has also enabled Bank of the West to automate more than a dozen processes across customer service, cash management and employee requisitions. For example, customer service representatives can enter customer inquiries directly into electronic forms which are automatically routed to the appropriate department for resolution. Approximately 5,000 Bank of the West employees use IBM ECM software today and the bank expects that number to grow as it continues to automate cumbersome paper-based processes. IBM WebSphere Application Server software provided a performance-based application foundation for building, deploying and managing a reliable, available and scalable ECM and BPM solution.

Benefits

• Reduced approval turnaround from nearly a week to less than one day
• Expected savings of about $1.5 million over five years
• Improved staff productivity to enable employees to focus on strengthening customer relationships