Growth is a popular and challenging word for today’s banks. With customers having myriad options for financial services and banks facing shrinking margins, the key to growth is taking new approaches and looking beyond a bank’s traditional services. At least that’s the philosophy of Banterra Bank, a $1.3 billion bank in Illinois, and so far, it’s working. The bank has grown assets significantly in recent years, and its ROA and ROE—1.1 percent and 11.2 percent, respectively—are above industry average.
According to Jef May, Banterra’s president, the bank’s focus on geographic expansion, lending diversification and cost control has allowed it to achieve these impressive results. He also believes that digital banking has reached its tipping point and that community banks must rise to the occasion over the next five years to remain competitive. May says that banks have to change their focus and work with technology providers, like CSI, that have a shared vision for the future.
Challenge
While it has experienced growth over the past few years, Banterra Bank, like all banks today, faces numerous obstacles to ongoing success: digital competitors, shrinking margins and cyber threats.
Solution
The bank diversified its loan portfolio, expanded its footprint and managed its costs effectively; this included working collaboratively with its core provider to offer competitive retail products, leverage secure systems and provide more digital services.
Result
Banterra boasts ROA and ROE that are ahead of the industry average: 1.1% and 11.2%, respectively. The bank also is working toward a more digital future, a vision it shares with CSI.
Combining Technology and Service
Banterra’s growth strategies include, among other tactics, ofering new types of lending and expanding its branch network into other areas. Since 2005, the bank, a long-time NuPoint® core platform user, has focused on expanding its footprint beyond Illinois, opening branches in three additional states. Along the way, it relied on CSI to assist with its growing retail business. Debra Becht, the bank’s senior vice president of retail banking, helps ensure that Banterra fully leverages NuPoint’s technology in order to ofer competitive services to the bank’s growing retail deposit customer base.
“On the deposit side, CSI’s platform offers great flexibility for building products,” Becht says. “We’re using it to its fullest extent, and we have a great working relationship with CSI.”
And it’s the solid partnership with CSI that further supports the bank’s ability to deliver competitive products and services to its customers. Banterra, like most community banks, focuses heavily on providing high-quality support for its customers, so fulfilling that mission requires a highly responsive technology partner. For May, that’s one of the best aspects of working with CSI.
“CSI listens to us, and they are a good partner,” May says. “They are also quick to respond and work with us to get issues solved.”
Mitigating Customers’ Risks
To complement its growth strategy, Banterra also places a heavy emphasis on protecting customer data and the integrity of its systems. Cybersecurity has emerged as a significant threat to all banks, and Banterra realizes the risks associated with a data breach or system compromise. Becht understands that a security event would severely damage the bank’s reputation, and says working with CSI offers additional advantages.
“We have the utmost confidence in the security and audit processes at CSI,” Becht says. “The quality of CSI’s management of cybersecurity also makes us confident in their ability to help protect our bank.”
In fact, Banterra also relies on CSI’s regulatory compliance solutions to help further mitigate cyber threats. The bank has used such services as CSI’s penetration testing to identify and remediate any system vulnerabilities that may exist. And beyond the compliance services they receive from CSI, the bank understands the value of CSI’s own security posture.
“CSI’s history and audit reviews are sterling,” May says. “What’s more, their leadership and financial strength, in turn, give us added confidence in our ability to safeguard our bank and its customers.”
“We have the utmost confidence in the security and audit processes at CSI. The quality of CSI’s management of cybersecurity also makes us confident in their ability to help protect our bank.”
Debra Brecht
SVP of Retail Banking, Banterra Bank
Sharing a Vision For the Future
As Banterra continues on its growth trajectory, the bank’s leadership realizes the need to expand its business model beyond just traditional offerings. That’s why May is focused on delivering digital banking services that will allow the bank to compete with online alternatives, like Ally Bank, that have greater reach and lower overhead.
And he believes establishing relationships with technology providers that hold a similar view is critical for banks to make the transition.
“CSI recognizes the direction of the industry and talks about helping banks capitalize on the digital revolution,” May says. “The key to success for any bank is working with a provider that has both a commitment to service and a vision for the future—and we have that with CSI.”