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Arvest, Signature Bank Adopting New Tech

5 min read

The bank of tomorrow will be a digital one.

Brick-and-mortar banks aren’t going away, but online resources, digital platforms and mobile connections are the future of banking, Arkansas bank professionals said last week.

“It is critical for community banks and regional banks,” said Teslar Software CEO Joe Ehrhardt. “Community banks and regional banks have no choice but to innovate.”

Arvest Bank of Fayetteville, one of the state’s largest banks with more than $26 billion in assets, has been working for the past couple of years to get ahead of the digital curve. Arvest started its digital transformation in 2019 and hired former Google Cloud executive Laura Merling as its chief transformation and operations officer in the fall of 2021. The bank had previously partnered with Google Cloud to upgrade its information technology architecture in 2022.

Earlier this year, Arvest announced publicly one of its first big digital rollouts, a cloud platform for its equipment finance lending division. The platform was created by Thought Machine of New York City, a global banking software company.

Arvest said the platform will let the bank operate in the segment more efficiently and quicker. In 2021, the last full year of data, the bank’s subsidiary Arvest Equipment Finance made $685 million in loans and leases.

“As we think about the future of banking, we identified equipment financing as an area of opportunity to address pain points with obtaining important, business-sustaining equipment for commercial customers of all sizes,” Merling said in February. “Through Thought Machine’s modern, cloud-native platform, Arvest is able to differentiate its entire banking experience and release financial products faster. This is just the first of many exciting services to come as we continue to build a best-in-breed banking service that supports the growing needs of our business customers.”

Merling said Arvest Bank also moved one of its data centers to Google Cloud. Another initiative in development is a platform that would allow customers to have access to their information, which also allows the bank to provide better service with all a customer’s information in one place.

A Five-Year Project

Offering an equipment finance platform wasn’t the first Arvest Bank upgrade, and it won’t be the last. Merling said the transformation is a five-year project and, although the bank didn’t release the total financial investment, Arvest Bank is hiring or training about 1,000 employees to handle the changes.

“Arvest’s transformation is driven by our desire to ensure that we stay ahead of customers’ changing preferences and needs as they evolve over time,” Merling said. “Our mission is ‘people helping people find financial solutions for life,’ and in order to stay true to that focus, we must remain flexible as technology advances and as customers’ preferences change, define what it looks like to be a community-focused bank in a digital world, continue to leverage our strength in relationship building, and be actively engaged in driving change at all levels of the organization.”

Ehrhardt said banks have two options, try to maintain the status quo or dive into the innovation pool. He said for a bank such as Arvest Bank with more than 200 branches in four states, the challenge is to balance location operations with new technologies.

“There’s not a perfect answer to that,” Ehrhardt said. “It’s not just the front end for the consumer, but it is every part of the bank. People think it is just the online side, but it is every part of the bank. That is where the user sees it.

“Auto payment, loan term change, all those unseen processes, the consumer sees it in the speed in how the bank reacts. What used to take a day or a week now takes 10 minutes.”

Brant Ward is the president of Signature Bank of Fayetteville, a Teslar Software client. He said banks have to make innovation work seamlessly for their employees and their customers.

“It’s table stakes to be the bank that can service customers effectively,” Ward said. “Most banking platforms of the past were very archaic and inflexible; the ability to integrate new technologies as they arose was much tougher than it is today. Today’s environment has allowed banks not to just use technology, but to quickly embrace moving forward with platforms and applications that align with their goals.”

Relationships Critical

As the banking industry joins other business sectors racing toward the digital horizon, its executives point out that it doesn’t mean banking is going to become an impersonal, robotic experience.

Ehrhardt and Merling said relationships are still the heart and soul of banking. Ehrhardt said that, as an example, bank clients still want to know their banker but want to be able to have access to services 24 hours a day, seven days a week.

“Over the last several years as transactions have shifted from in branch to online, it’s become incredibly important for financial institutions to grow their digital tools and meet customers where and how they want to bank,” Merling said. “Relationships are still critical to these interactions. But a successful technology investment is only as effective as the team’s implementation and operational capabilities. That’s why our transformation journey is focused on the people, processes, and technology required to be the community-focused bank in a digital world.”

Ward said Signature Bank implemented a platform to open accounts online in 2021 and recently upgraded it with an e-signature application.

“Whether you are physically in the bank or digitally logged in, you can perform the same activities when you want to, where you want to,” Ward said. “The idea of purchasing a good online whenever it’s convenient for you, instead of going to the department store, has transferred to banking as well. If you want to come to the bank, we want you to come, but if you need to transact your business at 11 p.m., digital allows us to provide the same level of customer service online as you’d receive if you walked in the front door.”

Efficiency means cost savings and more time for services.

“For customers, it means they have more access to Arvest associates and bank services when, where, and how they want, with more self-service options and with a clearer view of their full financial profile,” Merling said.

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