How does one go about implementing a data warehouse for banks? Are there any case studies available for implementation in large banks in the U.S. and U.K.? Can I get information on the status of implementation in such banks?


Sid Adelman’s Answer: The implementation for a bank is not much different than the implementation for any other industry. The standard texts will give you that information. You will, however, need to determine where the bank could make effective use of information from a data warehouse. These are a number of applications that banks have implemented:

  • Evaluating business concentration and risk exposure leading to modified credit policies and loan loss reserves
  • Consumer asset data
  • Spot market trends
  • Government regulation reporting
  • Marketing
  • Mergers
    • Geographic overlap and saturation
    • Information for government regulation and approval
  • Support management planning, marketing and financial decision making
  • Ability to track and cut costs
  • Manage resources more effectively
  • Provide feedback to bankers regarding customer relationships and profitability
  • Information on spending patterns on a segment of issuing members card base (co-brand)
    • Target marketing
    • Promotion performance
  • Members use it to analyze performance by product, geography, interchange rates, volume by merchant, location, promotions, operational performance
  • Cardholder spending by state and merchant classification to develop direct mail promotion with key merchants.
  • Ability to select better marketing partners, build innovative and successful new product and build brand loyalty
  • Co- branding – determining where their cards, e.g., Sierra Club, NRA, are being used and develop target marketing plans
  • Combine with proprietary data to determine purchase patterns to develop marketing programs
  • Agent alerts
    • Early warnings for changing spending patterns
    • Opportunity for special offer based on abnormal cardholder activity
    • When response rate to promotions hits target
  • Test promotional opportunities
  • Mortgage Loan portfolio
    • New loans in process (pipeline)
    • Secondary marketing of mortgage loans
  • Deciding how to package new offerings
  • Monitor enterprise-wide data
  • Information on cross-selling
  • Information on the results of special promotions at the branch level
  • Profitability
  • Integrating demographic and geographical data aimed at customers’ specific needs
  • Use what is known about the customers to understand and forecast the economy
  • Ability to service business partners faster

Clay Rehm’s Answer: The planning, analysis and design is no different than any other industry. The planning and requirements gathering phases are the most important and you can use templates and techniques from other successful projects and other successful data warehouse projects in other industries.

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