OTP Bank maintains its market-leading position

Driving better business decisions with IBM Business Analytics

Published on 25-Jan-2012

Validated on 01 Jul 2013

"With the help of the IBM SPSS Modeler we can go through all the modelling stages quickly and easily, from data preparation and analysis to outputs." - Tamás Tóth, Head of Analysis and Modeling, Credit Approval and Risk Management Division, OTP Bank

Customer:
OTP Bank

Industry:
Banking

Deployment country:
Hungary

Solution:
BA - Business Analytics, Business Integration, Business Performance Transformation, Business Resiliency, BA - Predictive Analytics, Smarter Planet, Business-to-Business

Smarter Planet:
Smarter Banking

Overview

OTP Bank has played a defining role in the Hungarian banking sector for more than 60 years and has operated as a multi-functional commercial bank since 1989. It is a member of the OTP Group, which provides universal financial services through several subsidiaries. In Hungary, traditional banking operations are performed by OTP Bank while specialised services, including car leasing, investment funds and insurance, are developed and offered by the group’s subsidiaries.

Business need:
In order to maintain a competitive edge, OTP Bank requires quality information that it can use to drive better business decisions. The bank needs powerful data modelling and analysis tools to gain enhanced insight into all facets of its business.

Solution:
OTP Bank uses IBM® SPSS® Modeler to reveal patterns and trends in data, taking advantage of the software’s outstanding modelling and scoring tools to provide managers with the information they need to capitalise on opportunities and mitigate risks.

Benefits:
Provides accurate, current, high-quality information which helps to shape critical business decisions and strategy and maintain competitiveness. Offers an attractive price-to-performance ratio. Enables fast, straightforward creation of scoring and analytical models that give enhanced insight into a diverse range of company operations.

Case Study

OTP Bank has played a defining role in the Hungarian banking sector for more than 60 years and has operated as a multi-functional commercial bank since 1989. It is a member of the OTP Group, which provides universal financial services through several subsidiaries. In Hungary, traditional banking operations are performed by OTP Bank while specialised services, including car leasing, investment funds and insurance, are developed and offered by the group’s subsidiaries.

OTP Bank embarked on international expansion in the early 2000s, and now has subsidiaries in eight other European countries. In addition to Hungary, it is also the market leader in Bulgaria and Montenegro. Annual profitability in the last few years has been between 150-300 billion Hungarian forints. The bank employs around 8,000 people in Hungary, and OTP Group as a whole has a staff of 30,000.

Using quality information to remain competitive
As Hungary’s leading bank, OTP processes extremely large volumes of data, making it essential to use powerful analytical, reporting and scoring systems to gain a comprehensive view of its own operational processes, client requirements, and market conditions. In the current turbulent business environment, quality information is required to ensure that the bank achieves a competitive advantage by making accurate, evidence-based decisions more rapidly than its rivals.

OTP Bank has been using IBM SPSS software to drive more informed analysis since the early 2000s. According to Tamás Tóth, Head of the Analysis and Modelling Department of OTP Bank’s Credit Approval and Risk Management Division, “OTP Bank gives serious consideration to making purchases, and we always try to make the best decision from a professional point of view. We consider the price to value ratio of any product to be just as important as the professional criteria.”

Improved commercial awareness and more informed decision-making
IBM SPSS Modeler reveals patterns and trends in data, using a unique visual interface supported by advanced analytics. OTP Bank can use the application to model outcomes and understand what factors influence them, allowing it to take better advantage of opportunities and mitigate risks.

While OTP Bank generally uses IBM SPSS software for all types of modelling, SPSS Modeler is predominantly used in the construction of scorecard models and related analytical processes. The bank employs these scorecard models to provide a comprehensive set of performance measures and build the framework for its strategic management system. The scorecards themselves allow managers to look at the business from different perspectives and gain a better awareness of the bank’s activity.

IBM SPSS Modeler also helps to create models which accelerate and facilitate decision-making processes in the bank through the use of various automated processes. “With the help of Modeler we can go through all the modelling stages quickly and easily, from data preparation and analysis to outputs,” says Tamás Tóth. “Deployment of the reports is also relatively simple, with a wide range of options available.” The software allows users to choose between the most commonly used types of model and analysis, and they can nearly always find something appropriate.

OTP Bank professionals are highly interested in the innovations being introduced by IBM SPSS software, and are open to new products. Every purchase is preceded by a thorough consideration of their choice, and they aim to apply identical standards at group level to ensure standardisation across the business and enhance efficiency.

High performance, solid support
OTP Bank operates at a profit, and SPSS products naturally play their part in this, even though it is difficult to quantify the benefits derived from using the software. “For us, IBM SPSS software is a highly effective tool for performing all types of modelling and analytical tasks. It certainly adds value to the business, even if we can’t put a numerical figure on these benefits,” says Tamás Tóth.

For OTP Bank, the true value of IBM SPSS Modeler lies in its powerful analytics capabilities. The application enables rapid, efficient creation of models such as the bank’s scorecard system, which fuel enhanced insight into a diverse range of company operations. These models provide accurate, current and quality information which helps to shape critical business decisions and strategy, helping OTP Bank to remain competitive in a tough market.

Another advantage of the IBM SPSS solutions is the excellent support service provided by IBM, which is local and easy to access, enabling any issues with the software to be quickly resolved.

“I am absolutely satisfied with the support of IBM SPSS Hungary,” states Tamás Tóth. “If there is anything we are unable to solve alone, they are always open and ready to give rapid answers. For example, while testing a previous version of SPSS Modeler, it turned out that one of our nodes was faulty. Once we informed IBM SPSS of the fault, they were able to quickly correct it.”

Despite strong competition from companies such as SAS Analytics, OTP Bank is convinced that IBM SPSS applications offer the best price to performance ratio in the industry.

“We have no intention of changing our software, as we have been highly satisfied with all aspects of the solution. Simply, put our daily operations would be impossible to solve satisfactorily without IBM SPSS software,” concludes Tamás Tóth.

About IBM Business Analytics
IBM Business Analytics software delivers actionable insights decision-makers need to achieve better business performance. IBM offers a comprehensive, unified portfolio of business intelligence, predictive and advanced analytics, financial performance and strategy management, governance, risk and compliance and analytic applications.

With IBM software, companies can spot trends, patterns and anomalies, compare “what if” scenarios, predict potential threats and opportunities, identify and manage key business risks and plan, budget and forecast resources. With these deep analytic capabilities our customers around the world can better understand, anticipate and shape business outcomes.

Products and services used

IBM products and services that were used in this case study.

Software:
SPSS Modeler

Legal Information

© Copyright IBM Corporation 2012. IBM Hungary Ltd., H-1117 Budapest, Infopark, Neumann János u. 1st, Hungary. Produced in Hungary, January 2012. IBM, the IBM logo, ibm.com, and SPSS are trademarks of International Business Machines Corporation, registered in many jurisdictions worldwide. A current list of other IBM trademarks is available on the Web at “Copyright and trademark information” at www.ibm.com/legal/copytrade.shtml. IBM and Clementine Consulting are separate companies and each is responsible for its own products. Neither IBM nor Clementine Consulting makes any warranties, express or implied, concerning the other’s products. Other company, product or service names may be trademarks, or service marks of others. References in this publication to IBM products, programs or services do not imply that IBM intends to make these available in all countries in which IBM operates. Any reference to an IBM product, program or service is not intended to imply that only IBM’s product, program or service may be used. Any functionally equivalent product, program or service may be used instead. All customer examples cited represent how some customers have used IBM products and the results they may have achieved. Actual environmental costs and performance characteristics will vary depending on individual customer configurations and conditions. IBM hardware products are manufactured from new parts, or new and used parts. In some cases, the hardware product may not be new and may have been previously installed. Regardless, IBM warranty terms apply. This publication is for general guidance only. Photographs may show design models.