CHALLENGES
Mississippi-based Metropolitan Bank, founded in 2008, is a privately held financial institution that offers personal and commercial banking services along with mortgage lending. Metropolitan Bank which has eight full-service locations across two states surpassed $1 billion in assets in the first half of 2015. With the goal of continuing to grow loans, core deposits and non-interest income to generate core earnings and increase shareholder returns, the institution sought a solution that would significantly improve efficiencies within its financial reporting and planning processes, better track budget expenditures, and enable the accurate forecasting of cash flow on a detailed level. Additionally, the bank required a platform with the scalability to keep pace with the rapid level of growth that the bank has recently experienced and expects to continue.

SOLUTIONS
After much research and consideration, Metropolitan Bank selected Kaufman Hall’s Axiom Financial Institutions Suite – software for performance reporting, budgeting, and cash flow forecasting. Metropolitan needed additional flexibility in writing reports and summarizing data from its core system, and Axiom was the best fit for the bank’s needs in this area. Prior to implementing Axiom Software’s budgeting solution, the institution had a spreadsheet-based budgeting process which required manual consolidation and their margin and yield calculations weren’t as accurate as they needed them to be. Additionally, their former cash flow planning process didn’t provide the visibility they needed into how loan runoffs were affecting their cash flow, forecasted net loan growth and the impact on loan yields, spread and net interest margin.

RESULTS

Improved efficiencies surrounding financial reporting
Prior to implementation, creating daily, monthly, and quarterly financial reports consumed large amounts of its staff’s time as Metropolitan Bank relied on multiple Microsoft Excel® spreadsheets for financial reporting, budgeting and forecasting, which lacked efficiency and left room for potential error. Being able to bring in data from its core system in an automated fashion with Axiom Software helped Metropolitan significantly improve its financial reporting largely due to the capability for creating user-defined reports, editing reports with ease, and creating new templates for future reports. “We needed the capacity to create reports quickly and edit them if need be. The option to create templates for our reporting has allowed us to turn around information and one-off requests faster than we were able to do prior,” said Darryl Waltman, Director of Finance & Accounting at Metropolitan Bank. “Axiom has given us the ability to write whatever report we want to write in the system in order to give the appropriate information to whoever is asking for it.” To date, the software has drastically reduced the time it takes to create these reports, eliminating as much as 30 minutes from daily reporting in addition to saving days each month for monthly reports. Quarterly regulatory reporting including call reporting is also much quicker with Axiom Software and allows the bank to proactively manage its capital in light of regulatory guidelines.

Streamlined data-gathering for more precise analysis
Metropolitan Bank has significantly streamlined the collection of budgeting data from its management staff while also streamlining consolidation of that data, a task that was previously completed manually by Finance. It now runs and updates its consolidated budgets much faster than it did with its previous methods and more importantly, sees fewer errors and can uncover opportunities to improve its cash position and overall financial outcomes.

“Axiom has given us the ability to be more scientific with our budgeting and forecasting processes, particularly in how we forecast our cash flow,” said Waltman. “Our previous budgeting process consisted of distributed spreadsheets to each market and for our administrative/overhead expenses which was time consuming and error prone. Since using the Axiom Software budgeting solution, we have a lot more comfort in our numbers and can use them for better reporting and forecasting.”

Insightful and data-driven forecasting
Metropolitan Bank has also found Axiom Software’s cash flow forecasting tool capable of producing much more detailed and accurate margin and yield calculations. Prior to implementation, the bank utilized manually-entered, macro-level assumptions to support forecasting needs, which resulted in less focused calculations for projecting cash flows. By using Axiom’s cash flow forecasting solution, Metropolitan Bank has increased its visibility into net interest margin and loan yields, enabling it to more readily make necessary regulatory adjustments as needed. “During our recent quarterly forecast, we utilized Axiom Software to gain insight into our loan yield and NIM,” said Waltman. “This allowed us to make adjustments including controlling deposit inflow and outflow to support our rapid growth and help us anticipate our capital needs.”

Financial industry expertise and support
Metropolitan Bank attributes the smooth implementation of these solutions to the knowledge and experience of the Axiom Software team. “Our implementation went well and I was very pleased. The Axiom team’s experience working in financial institutions helped guide us in our efforts.” In addition to implementation, the Finance team at Metropolitan Bank has had great interactions with the Axiom Software support team. Waltman comments, “I’ve been very pleased with how responsive that everyone has been from customer support. When I ask a question, they not only give me an answer, but they also explain the solution and tell me why they approached the problem the way they did. They’re teaching me the system instead of fixing for me.”

Metropolitan Bank is looking toward the future as their growth continues and are confident that Axiom Software can support them in this growth.”We hope to be able to implement the FTP module in the next six to twelve months, as we are very interested in more accurately measuring our relationship profitability. The sky is the limit as to what you can get out of the system,” says Waltman.

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