Huntington National Bank gains competitive advantage through a best-in-class originations platform
"With some systems, you struggle with the platform and never get to focusing on your business problems. The ORBIT system developed by the CGI/Huntington team has allowed us to focus on our business issues and how we're going to move forward to improve our operations."
Dan Vermeire, senior vice president and chief technology officer, Huntington National Bank
The Client
Huntington Bancshares Incorporated is a $30 billion regional bank holding company headquartered in Columbus, Ohio. Through its affiliated companies, Huntington has more than 137 years of serving the financial needs of its customers. Huntington provides innovative retail and commercial financial products and services through more than 300 regional banking offices in Indiana, Kentucky, Michigan, Ohio, and West Virginia. Huntington also offers retail and commercial financial services online at www.huntington.com, through its technologically advanced, 24-hour telephone bank, and through its network of nearly 850 ATMs.
Selected financial service activities are also conducted in other states including: Dealer Sales offices in Florida, Georgia, Tennessee, Pennsylvania, and Arizona; Private Financial Group offices in Florida; and Mortgage Banking offices in Florida, Maryland, and New Jersey. International banking services are made available through the headquarters office in Columbus and additional offices located in the Cayman Islands and Hong Kong.
The Challenge
Those in the business of auto financing face a fierce competitive landscape, with margins that are paper thin. The winners must make faster and smarter decisions, effectively manage risk, and still book loans and leases at lower operating costs.
Huntington National Bank, the primary subsidiary of Huntington Bancshares Incorporated, a $30 billion regional bank holding company headquartered in Columbus, Ohio, was seeking to replace its homegrown originations system with a best-in-class solution that would allow greater flexibility, functionality, and scalability.
Building off its "go-forward architecture" strategy-using IT solutions that deliver maximum business benefits and are flexible to current and future needs-Huntington sought a partner to help it create a reliable, proven infrastructure that could operate in a high-volume, low-cost environment. It wanted a platform that would deliver faster turnaround time, better customer service, leveraged automated decisioning, and greater efficiency.
After evaluating systems from several providers, Huntington turned to previous partner CGI. Based upon successful results from working together on its collections efforts, Huntington trusted CGI's ability to help build a strategy and integrate a flexible solution.
The Strategy
The bank selected two CGI products. The first was the ACAPSŪ front-end originations platform, because it offered a solid processing engine that, through a joint opportunity, could be enhanced to support an indirect vehicle lease capability. This meant that the loan and lease functions could be supported on the same platform, whereas most banks have to use two platforms. The Strata® decision engine was also selected to integrate Huntington's front-end decisioning with its collections strategies and achieve compliance in the booking process. Because auto-decisioning is not just about speed but smarter decision making, these tools would help improve the overall quality and consistency of decisions.
To kick off the project, the CGI/Huntington team held in-depth discovery sessions with leaders from across the organization to discuss how the new originations system should be designed and implemented - from application data entry through the booking, funding, and loan boarding processes.
The result was a customized solution called ORBIT (Originations-Review-Booking-Imaging-Tracking), a high-speed, indirect lending platform that supports all aspects of credit processing for both loan and lease vehicle financing. "With some systems, you struggle with the platform and never get to focusing on your business problems. The ORBIT system developed by the CGI/Huntington team has allowed us to focus on our business issues and how we're going to move forward to improve our operations," says Dan Vermeire, Huntington's senior vice president and chief technology officer.
As the implementation phases of the project began, the CGI/Huntington team prioritized and controlled the deployment of this complex, multifaceted system. This process included extensive user testing that enabled the team to make timely changes, identify enhancements, and build a pipeline for future growth. Huntington found that by leveraging team members from across the company in the testing process, training time was significantly reduced when the system was ready for rollout.
For the initial launch, the team selected Huntington's home originations department in Columbus to ensure that the new system could efficiently and effectively fund contracts at high speed. The success of this test launch provided the confidence needed for the bank-wide rollout of the system.
The Results
"CGI's decisioning capability helps us to effectively manage risk by ensuring the quality and consistency of decisions... ultimately improving the bottom line," says Tim Barber, Huntington's senior vice president of credit risk management. Since launching ORBIT in mid-2001, Huntington is realizing business benefits that other institutions are only thinking about. Specifically, the bank can now:
- Generate 20 percent more volume at 30 percent less cost
- Expect a minimum of 5 percent efficiencies year over year due to system flexibility
- Guarantee to dealers that correct loans and leases will be reviewed and funded within 48 hours, 100 percent of the time
- Realize increased accuracy to internal and external customers by eliminating manual intervention
- Provide dealers with an immediate response for all applications that fall into the autodecisioning criteria established in CGI Strata
- Provide improved data access as a result of a well-designed reporting database
- Accelerate the implementation of decision strategy changes
- Implement a custom scorecard in a matter of days or weeks instead of months
The bottom line: Huntington has gained a competitive edge, increasing efficiency while processing more loans and leases at a significantly lower cost.
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