After laying a solid foundation over previous years, the Analytics and Data Management (ADM) Department flourished in 2018 after having succeeded in changing the Bank’s digital culture across the organization. For over two years, the team has worked relentlessly to propagate a culture that prioritizes data science and analytics and recognizes their importance. The team’s efforts materialized in 2018 and the business became ready to use data science to achieve its goals and accelerate growth. The team succeeded in building a favorable track record throughout the organization and became a trusted partner of various departments, allowing for more collaborative projects and higher dependency.
Additionally, the team set a clear agenda to assist the Bank in providing personalized products to customers, optimizing operational processes, understanding fast-paced market alterations and supporting the decision-making process. All this was conducted while maintaining CIB’s position as a market leader in the banking industry, and was reflected in the numerous awards CIB won during 2018. This was all achieved through:
- Investing in innovation
- Customer analytics
- Risk analytics
- Performance analytics
- Technological advancements
Moreover, in recognition of the Bank’s extensive efforts on the data front, London Business School (LBS) featured CIB’s data transformation as a case study in 2018, making CIB the first Middle Eastern company to be analyzed in a case study by the Leadership Institute.
The case study covered the evolution of the Bank’s human capital culture, which enabled it to meet its overall data transformation strategy. It also discussed the Bank’s success in changing the organizational design and operating model into a data-driven one. The case study will be taught in graduate programs for years to come.
Innovation is the ADM team’s main tool to safeguard the Bank’s current position as market leader. The industry is more dynamic than ever, with rapid changes taking place and new players attempting to enter the field. CIB must explore and utilize up-and-coming technologies capable of adding value to the Bank’s current business model. The ADM team believes that investing time and resources to embed innovation in the Bank’s everyday activities will translate to future earnings.
Blockchain has been a subject of intense study for the past few years. Using blockchain could change the dynamics of not only the banking sector but the economy as a whole. This technology can be used to create a digital identity, smart contracts, and cross-border transactions. As an early adopter of the technology in the Egyptian market, CIB was the first to join the Know Your Customer (KYC) project on R3’s Corda blockchain last year. This year, the Bank is reaping the benefits of the strategic decision to join this alliance. The ADM team is currently testing different use cases to develop live projects while simultaneously building a local blockchain network for banks and different financial services providers.
One of the CBE’s current priorities is to improve the existing KYC process by launching a study to explore using distributed ledger technology (DLT) to provide financial services. The plan will begin with KYC for retail customers, and corporate KYC processes will be added at a later stage. KYC, or eKYC in this case, becomes a stepping-stone toward financial inclusion. By adding data layers, such as medical records, subsidies, and governmental services, to the basic KYC structure, we can develop eKYC into a full digital identity for each citizen and pave the way for a more open banking platform.
Smart contracts are another promising application of blockchain technology; they allow customers in various fields such as shipping, real estate, and insurance to execute transactions and agreements automatically without an intermediary.
By investing funds and resources in developing blockchain technology, CIB is making transactions more secure, cheaper, and faster. The Bank will be able to perform cross-border transactions for a fraction of the cost and time; this technology can potentially replace SWIFT and other traditional payment platforms.
Throughout the year, the department continued to transform CIB from a product-centric institution to a customer-centric one, increasing product acquisition and customer satisfaction while optimizing marketing costs. The team completed a number of projects in this area, such as revamping our balance-based customer segmentation to a fully customized, data-driven, behavioral segmentation that puts the customers at the heart of the organization and decision-making process. Additionally, the department completed a project to segment credit card users based on purchase behaviors in order to provide the cards business with distinct customer segments characterized by well-defined behaviors, interests, and preferences.
The ADM team also developed a churn-propensity model to identify high-risk customers prone to churn; retention strategies were successfully developed based on this model.
In 2018, the team also launched a Digital Lending Program (DLP) to penetrate an untapped market of credit seekers based on their history as Careem captains. This program can be duplicated in the future to penetrate unbanked segments and increase financial inclusion through the use of data analytics tools.
Aligned with CIB’s 360-degree customer-centric strategy, the analytics team developed a tool to track and measure behavioral KPIs for all corporate and business banking customer interactions. Various new principle types of consumer indices were established by combining new KPIs and customer data with the main objective of spotting at-risk customers and new opportunities.
The team’s continuous efforts to analyze CIB customer data are expected to increase sales to new and existing customers, reduce customer churn, and increase loyalty while simultaneously delivering higher returns on marketing and promotions investments.
With the rise of computing power and new analytical techniques, banks can now extract deeper and more valuable insights from their ever-growing volume of data. For the Risk Department, these trends present unique opportunities to better identify, measure, and mitigate risk.
The team developed an anomaly-detection model to minimize fraud by identifying, monitoring, and controlling fraudulent customer behavior that suggests a threat of tax evasion under CBE anti-money laundering laws and regulations.
The team also collaborated with the Business Banking Department to create an early warning system comprised of a set of guided processes that identify risks at an early stage for business banking and corporate customers. The system’s main task is to support managing the loan portfolio and assist in taking proactive steps to reduce risks resulting from unsecured lending.
Performance analytics are an essential tool the team uses to achieve higher productivity and efficiency. Using this tool, the team was able to anticipate trends, prioritize resources, deliver automation and self-service, push towards consistent service improvement, and align services with CIB’s overall business goals and strategy.
In 2018, the team worked on re-engineering and optimizing average wait times at branches. A new evaluation tool was created to measure and assess the impact of any recommended action, eliminating the need to invest in new, untested methods and assess them after implementation.
The team also analyzed cash withdrawal activity across the ATM network and found that the Bank’s current ATM cash levels and structure are over funded. Using this knowledge, the team derived a formula to lower cash costs (largely opportunity loss of interest income and unnecessary costs such as cash transportation) and increase returns without affecting customer satisfaction.
Another performance analytics tool introduced by the team estimates the number of incoming calls to the call center, allowing for planning and allocating resources more efficiently. This tool has accurately captured call center demand in a fully automated manner. Insights gained from this tool have allowed us to create a more positive customer experience and optimize the department’s allocation of agents.
This year, the team launched CIB Navigator; a dynamic digital performance dashboard that enables different lines of business to track customers’ adoption of digital transactions across available online channels, and helps relationship managers and customer service officers persuade more customers to transition to available digital portals. Greater utilization of digital channels will reduce traffic at CIB branches and hence, increase cost synergies. In this regard, the execution of numerous transactions over alternative digital channels from traditional ones resulted in more than EGP 200 million cost saving in 2018.
Ranking dashboards were developed to create a competitive environment to achieve CIB’s strategic goals and objectives. Many managers use this tool to track their teams’ performance. These dashboards are sent on a monthly basis to branch sales forces, as well as the direct sales and telesales teams, and acts as an element of encouragement to increase sales.
2019 Forward-Looking Strategy
Starting 2019, the team will capitalize on the efforts and outcomes conducted in the arena of data analytics over the last few years, parting from the notion that data is the future. The department plans to continue harnessing the power and wealth of data available to keep CIB at the forefront of the Egyptian and regional financial sectors and further drive value for all the Bank’s stakeholders.