Independent Banker - June 2018 - 19

Next: What is emotionally intelligent leadership?
together with human knowledge and experience?
What factors determine the effectiveness or lack
of effectiveness of technology?
Samir Agarwal is vice president of Wolters Kluwer's
community bank and credit unions group.
In that role, he is focused on helping community
banks make sound risk management and compliance
decisions to grow their businesses.
" The best way to use technology in a compliance
program ... is in business process management, "
says Agarwal. " Over the past decade, there have
been many independent 'point' solutions developed
to solve a specific problem; for instance, a
change in document compliance or a calculation
required for a mortgage loan. A very fragmented
system can result.
" It is very important to ask, 'What technology
can assist the institution to achieve the business
practice it is trying to accomplish?' "
In a community bank, consumer and commercial
business is typically split into two divisions.
Within those divisions, each staff member takes
on a broad assortment of roles and handles a
wide variety of highly regulated products and
services. Compliance within each area is often
achieved by an independent " checklist " method,
rather than as an integral, formalized part of the
broader business management structure.
Technologies as business process management
tools can ensure the bank is operating in the
manner it intends and in compliance with regulatory
requirements. " If we use technological
solutions the right way, " observes Agarwal, " we
achieve automation that is consistent, repeatable
and uniform. It can mitigate or remove the
human error factor from the equation and allow
us to focus on business needs. It can also free
up management to address other non-technology-related
needs. "
He says the goal is to balance business process
management so it is not run " entirely by gut or
conducted in a totally assembly-line fashion. "
The aim of regtech is to show whether an institution's
bankers are operating efficiently and in
compliance, and to offer a tool to measure and
prove adherence.
What about human knowledge and the human
touch? Agarwal believes the actual business of
banking needs human interaction. " When we talk
about the types of products and services we offer,
various customer financial pictures, differences
in collateral, these are all factors requiring customized
discussions, " he says. " That is the heart
of community banking and a community bank's
relationship with its customers. "
Whittling down the list
What steps should community bankers take to
implement technology in the most cost-effective
and efficient manner?
Agarwal considers self-assessment the starting
point. " Ask, 'What do I want to achieve with the
use of technology?' " he says. " Some bankers do
not step back to look at their whole business process
management program, and they focus on one
" The best way to
use technology in a
compliance program ...
is in business process
management. "
-Samir Agarwal, Wolters Kluwer
Quick stat
June
2016
The term
" regtech " is
coined by the
U.K.'s Financial
Conduct
Authority
specific exception from a recent examination or
audit. But the factors that drive the effectiveness
of technology are conducting a self-assessment,
understanding the goals that need to be met, and
then choosing the right technologies that will
solve them and protect the future operation. "
He encourages community banks to look at the
technology market, what others are using, and
technology research and advisory firms' analyses.
Planning, implementing and managing effective
technology solutions is a nearly impossible
task if left to circumstance, and the outcomes
may well be reflected in the budget, examination
results and staff frustration level for years
to come. Community banks can avoid overspend
and digression from the objective by conducting a
solid assessment up front, determining what elements
are required and addressing them.
Mary Thorson Wright, a former Federal Reserve
examiner, is a financial writer in Virginia.
independentbanker.org Q 19
http://www.independentbanker.org
Independent Banker - June 2018

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