TCF Retail Lending. SMART Data Case Study. May 12, 2015

Transcription

1 TCF Retail Lending SMART Data Case Study May 12, 2015

2 Contents TCF & Retail Lending Overview Historical Timeline Current State Proposed New Approach Overall Business Case Q&A 2

3 TCF Overview & Retail Lending TCF Corporate Profile $20 billion national bank holding company headquartered in Minnesota 45 th largest publicly traded US based bank holding company by asset size 379 branches in 8 states 85% of total assets are loans and leases Retail Lending Overview $5.6 billion of residential mortgage loans-$3.0 billion first mortgages and $2.6 billion junior lien loans Primary strategy is to originate high credit quality secured loans for investment and for sale Significant focus in 2015 in improving Finance systems, processes and controls 3

4 Historical Timeline RLBI Started Sept 13 RLBI Release 1 Complete July 14 RLBI Release 2 Complete May 15 MERF File Automated RLBI Release 3 Was Slated for Dec 15 RLBI Releases 4+ Were Slated Through 2016 RLBI CRA Portfolio on EVOLV Apr 15 K19 Being Presented for Full EVOLV Implementation, Today EVOLV Fully Implemented Mar 17 EVOLV EVOLV CRA Portfolio Launch Oct 14 Move Away from RLBI to EVOLV Concluded Feb 15 Enterprise View Obtained -Corporate Leadership -IT Leadership Included -K2 and Rueben Creative All Loans in EVOLV Dec 15 Participation Capability Mar 16 4

5 Risk and Finance Manual Processes Loan Data Flow Opportunity Summary of Current State Shaw Servicing System Servicing Systems SBO Portfolio - OCWEN SBO Portfolio PNC and Future Cash and Operational Entries from Shaw GL / ~70% data movement and 30% data creation CQDB LDB RLDM M-E Financial File 3 Reports (Remittance, DQ, Summary) TBD GL Recon F91 ALLL / ERM CRA Purchase Program Recon Essbase Non-Accrual / Re-accrual REO REIT Acctg SBO Loans Charge-off System TDR Run-off Programs (Command Protect) Fiserv Claims F114 FAS 65 HFS Credit Quality Reports Rollforward Reports Future Processes --- PCI Accounting? CECL? 5

6 Architectural / Data Perspective -- Industry Best Practices Source 1 Historical Model: Distributed Ownership Source 1 Industry Trending Model: Enterprise Centric Warehouse Distributed Applications Source 2 Source 2 Source 3 Source 3 Source 4 Source 4 Distributed responsibility for sourcing, staging and end user reporting Centralized responsibility for enterprise data, MDM assets and LOB control and dictate their specific needs 6 6

7 Proposed New Approach Enterprise Business Intelligence & Operational Storage RLBI Original Scope Proposed Scope Enterprise BI Shaw Harland RL Other RL Data Stage / Extract / Cleanse / Transform Application Hard Coded / Infer/ Calculate Original RLBI Scope Blended all three elements Focus on Finance Reports only as output Non-Finance reports some day Other BU s Enterprise Data Stage & Operational Storage Operations Shaw Harland RL Other Evolv Infer / Calculate Refocus on data staging & operational storage Enterprise project Evolv Proposed Solve RL Finance Needs RL Data Mart RL Finance Reports Retail Lending focus If you build it they will come Credit Accounting (FAS 91, Non Accrual, etc) Finance Reports Data layer includes inference, enrichment and identification Release 2, to be done in Q2, automates Month End File Maintain Releases 1 and 2 Risk Unanticipated Needs Enterprise Database Reserving (TDR, guideline, etc.) Forecasting & Stress Testing Application layer includes calculations, model execution, and automating manual processes Scalable / Flexible Much more than just reporting 7

8 Risk and Finance Automated Processes Loan Data Flow Opportunity EVOLV Solution Source Systems Shaw Servicing System LSBO Portfolio OCWEN, Education Lending SBO Portfolio CRA Loans Shaw Cash and Operational Entries GL / RLDS Adaptor Adaptor RLBI Integrated Risk and Finance Solution for Loans GL Data Enrichment & Management FAS 5 Common Data Layer for Risk and Finance Originated Loan Accounting Credit and Reserving FAS114 / TDRs Loan Accounting and Forecasting Acquired Loan Accounting Loan Risk Analytics and Model Execution Credit Review Model Execution Cash Flows Analytics Stress Loan Level Risk and Finance GAAP and Adjusting Entries; Loan Level Extracts Enterprise Data Warehouse Risk, Finance & Users Implemented Current Implementation 8

9 Architectural / Data Perspective -- Scalability Comparison Financial Management Functions RLBI Applicability Forecasting ALLL & Credit DFAST & Risk Accounting Loan Sales EVOLV Applicability Forecasting ALLL & Credit DFAST & Risk Accounting Loan Sales Enterprise View RLBI Applicability Winthrop Equip Finance Inventory Finance Gateway Retail Lending Commercial EVOLV Applicability Winthrop Equip Finance Inventory Finance Gateway Retail Lending Commercial 9

10 Business Case for EVOLV EVOLV vs. RLBI EVOLV RLBI Development External Internal Maintenance External Internal Scalable Across TCF Uses Yes, Accounting, ALLL, DFAST, Forecasting, Loan Sales No Vendor Primatics N/A Business Case for EVOLV Data Integrity and Controls Clear RCS Unsatisfactory rating Reduce financial reporting risk, protect shareholder value Efficiency Gains Reduce compliance cycle time and increase analytical capacity Primatics better positioned to maintain system Enterprise Scalability Applicable across all lending units Loan Sale Structure Flexibility Participations and other structures 10

11 Q&A 11