Nurturing growth is a top priority for many community banks. In fact, 69 percent of the bank executives surveyed as part of CSI’s Banking Priorities 2018 study said driving growth and profitability is their greatest challenge. One bank is meeting that challenge head-on.
In a 10-year period, Consumers National Bank in Minerva, Ohio, grew assets by more than 120 percent while increasing the number of full-time employees by only 15 percent. So, what’s the secret behind the institution’s success? According to Ralph Lober, president and CEO of Consumers Nation Bank, it all started with the bank’s decision to form a partnership with CSI.
A Core Decision
When Lober joined Consumers National Bank in 2007, the bank was analyzing whether it should continue in-house processing or outsource its core banking operations. Managing the core internally was both time and labor intensive, and Lober says it was difficult for the then $200 million institution to justify the costs and overhead of internal processing.
For several months, Lober and his team examined multiple vendors that provided both in-house and data center processing. Eventually, the bank decided to outsource its core processing, and chose CSI as its technology partner to help increase efficiency, expand product offerings and reduce information technology (IT) risks.
“The bank I came from was a CSI customer, so I was very comfortable with their system and the way they managed accounts, which I liked a lot,” Lober says. “I knew that when I called CSI for help, I was going to speak to someone who knew me and knew the bank.”
Lober says switching to NuPoint®, CSI’s core processing solution, provided services like card management and branch capture that immediately improved several of the bank’s new account processes. In addition, services like NuMonitor, CenterDoc, document imaging, NuPoint Reporter and Card Sentry allowed for process consolidation and consistent, cost-effective growth.
“We went from approximately $10 million in annual loan production to about $75 million.”
Ralph Lober
President & CEO
Consumers National Bank
“Before switching, we used a number of separate systems to complete new account and maintenance processes,” Lober says. “With CSI, it’s all in the same platform so we eliminated some redundant procedures.”
Last year, the bank began using NuPoint Teller Capture, which automates customer-facing transaction processing systems by combining image processing with teller functionality, including integrated check scanning and virtual ticketing—something Lober appreciates.
“Teller capture has resulted in front-line and back-office efficiency, as well as a reduction in the number of tickets we had to buy,” he says.
The efficiencies gained from outsourcing core operations and incorporating additional functionality have enabled management to focus on other priorities. Mainly, the desire to grow Consumers National Bank commercially.
The Path to Growth
Converting to CSI solutions allowed the bank to reduce the IT, operations and bookkeeping staff by about nine positions. The change provided management the flexibility to reallocate these positions to fulfill some of the bank’s other needs, including audit, loan processing and a renewed emphasis on commercial sales—with outstanding results.
“We went from approximately $10 million in annual loan production to about $75 million,” Lober says. “And we’ve added three branches and two loan centers in five different markets since 2007.”
Reallocating staff investment from processing to sales positions on the front line made a huge difference in the bank’s growth and efficiency, but management had another strategy to keep Consumers National Bank’s momentum going strong.
The Benefits of Digital Banking
Lober believes a community bank cannot recruit commercial or retail customers from mega and regional banks without offering them equivalent or superior technology, even if they buy into the community bank philosophy. So to improve customer experience while gaining efficiency. Consumers National Bank is converting to some of CSI’s Digital Banking solutions, including Business Banking, Internet Banking and Mobile Banking.
“CSI’s Digital Banking meets, and in many cases, exceeds the capabilities of what we are currently offering on both the retail and commercial sides,” Lober says. “For example, our commercial customers want a cash management system, from ACH origination to wire modules, that is integrated with mobile banking. When we move to CSI, we’ll be able to provide these services through mobile devices at a price point that makes sense for a community bank.”
As an added bonus, the conversion to CSI’s Digital Banking will allow the bank to eliminate two additional vendor relationships, which Lober says will increase overall efficiency, lower IT risk and provide a more seamless customer experience—three key ingredients in the recipe for growth.
Building Trust
However, a bank cannot consolidate vendor relationships and formulate a winning growth strategy without a dependable partnership with its main service provider. Lober’s relationship with CSI, specifically with his Ohio-based relationship managers, has been blossoming for nearly two decades. He has worked with the same two relationship managers during his entire 18 years as a CSI customer, adding a sense of continuity to the service CSI provides to the bank.
“Like the bank, both relationship managers are based in northeast Ohio. That’s huge,” Lober says. “We used to meet with our previous provider once a year. Now we meet face-to-face with Maria Dallas once a month to go over current projects and other matters. She continually works without management team and technology steering committee to ensure the bank is getting the most out of our CSI solutions. And that’s big, in my opinion.”
Over the last 10 years, Consumers National Bank has dialed up the right strategy to achieve growth and keep the customer pipeline full. There are many different aspects of a successful growth strategy, but regardless of assets, location or number of branches, a strong partnership between a financial institution and its technology provider cannot be overlooked.