Bank Innovation’s Top 3 Posts in February
With big-money deals, product rollouts, and a busy earnings season to boot, it is perhaps no surprise that a merger to potentially create the sixth-largest bank in the U.S. got the most attention from readers in February.
Below are Bank Innovation’s three top posts for the month, determined by views as well as editors’ choice.
BB&T’s $28.2 billion all-stock acquisition of SunTrust Bank, announced Feb. 7, made waves in the financial world, which wondered aloud what the massive technology integration effort will look like.
“BB&T has a great digital offering, but SunTrust has the superior technology when it comes to the lending business,” one source told Bank Innovation.
It appears that SunTrust will take the lead on the technology front, Jeremy Acevedo, manager of industry analysis, Edmunds, told Bank Innovation. And indeed, in a joint presentation, BB&T and SunTrust announced that the new entity’s Chief Information Officer will come from SunTrust: Scott Case, not BB&T’s Barbara Duck. However, the bank’s Chief Digital and Customer Experience Officer is a BB&T executive: Donta Wilson.
The deal creates a combined bank, still unnamed, valued at $66 billion.
Core processor Jack Henry & Associates signed a deal with Zelle‘s parent company Early Warning in 2016, but it won’t be deploying the P2P service until 2020, at earliest, Bank Innovation learned last month.
Jack Henry only started beta testing Zelle for Symitar, its core credit union data processing system that serves 680 credit unions, this year. It has also begun certification testing for its bank-focused SilverLake core and Symitar.
The core processor expects to complete testing for all cores by the end of 2019, Rusiru Gunasena, senior director for JHA Payment Solutions at Jack Henry, told Bank Innovation.
“We are building a centralized payments hub, JHA PayCenter, that will connect all of our banking and credit union cores with all faster payment networks,” Jack Henry’s Gunasena said. “The first network implementation will be Zelle. Core clients using Jack Henry’s GoDough (mobile) and Banno (online and mobile) platforms will be provided with a full-service integration including settlement and reconciliation, debit network integration for out of network transactions, reporting, and data contribution.”
The integration process doesn’t stop here. The credit unions will have to then sign a participant agreement with Zelle, a step required by Early Warning. After this step, the FIs will contract directly with JHA for these services, Gunasena explained.
JHA PayCenter will then start onboarding, but in batches. This process is an “efficient and faster process than direct integration with Zelle,” Gunasena said.
Banco Santander’s five-year, $700 million agreement it reached with IBM in February will enable the Madrid, Spain-based bank to “accelerate and deepen” its digital transformation to a more open, flexible institution.
This means Santander is poised to tap into IBM’s AI, blockchain and big data offerings. For instance, the bank will use IBM Watson to improve customer experience, enhance branch advisors expertise and increase employee productivity.
Executive Chair Ana Patricia Botín said during the bank’s 4Q18 earnings call that Santander doubled its number of digital customers and doubled the number of digital transactions over the previous three years.
“We have much more engaged customers and what’s important, 68% of the engagement from customers comes from the mobile; and finally, we have doubled digital sales,” Botín said, adding 32% of the bank’s sales across the group are now made through digital channels.
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