Ready To Comply

Two California banks implement software that automates the compliance process

Two California banks-Cathay Bank, Los Angeles, and Community Bank of Central California, Salinas-are deploying a software application from Netherlands-based BWise to help track and manage the variables throughout their organization that affect compliance. BWise is providing the solution to the two banks as an application service provider (ASP).

Launched in February, the BWise Internet-based solution, called Cubed Compliance, combines in-depth compliance knowledge with advanced business transformation software technology. The platform is designed to increase bank compliance efficiency and overall performance by giving all employees-from managers to tellers-access to relevant information, performance objectives and indicators. Because it provides a single repository for all relevant compliance information, it also facilitates documentation to support auditors.

The platform is scalable to serve the needs of banks of any size.

Limited resources, time pressures, and the need for quick accessibility contributed to the decision to take advantage of BWise's ASP services, said Ray Williams, vice president, compliance and privacy officer at Community Bank of Central California. "ASP also reduces costs and eases the bank's concern about additional hardware expenses. This was definitely the right choice for our bank."

For Cathay Bank, new banking legislation and regulations were the driving force behind the decision to go with BWise, according to Mary Grace Karonis, vice president of compliance. "Our decision to deploy the BWise Compliance Edition software was in response to this ever-growing regulatory climate and the need to enhance communication among all our employees to improve efficiency in implementing change."

The solution provides bank compliance officers with better use and maintainability of compliance information. Document and version management modules track regulation changes and references. Hyperlinks to key people, updated procedures and new regulations ensure that every regulation and policy impacted by a regulatory change is covered. Online replacement of existing documents, expirations and review-by dates, as well as easy access to relevant regulations and procedures, also enhance the use and maintainability of compliance information.

The solution increases bank efficiency through workflow that supports the organization of compliance improvement and cost reduction in the maintenance of compliance. It improves employee productivity, contains employee-training costs, and improves the deployment of timely and adequate compliance/policies.

The Communication Engine, the core of the platform, improves management control by enhancing communication. As a result, employees have a better understanding of accountability and risk, and an increased knowledge and awareness of new processes.

U.S. banks operate in a largely paper-intensive, manual environment, where it is increasingly difficult to keep pace with the demands of a growing regulatory environment, noted Tim Willems, president and CEO of BWise. "Our solution gives everyone involved immediate access to procedures and policies for state and federal regulations and acts, pending or passed, thereby improving the time it takes for implementation and the lowering risks of noncompliance."

Willems also pointed out that while compliance is the major focus of BWise Cubed Compliance Edition, the platform could be used in other areas of the bank, including operations, back office and loan processing, from the teller window through accounting.

The use of the BWise ASP model reflects a growing trend on the part of the banking industry to outsource some of their technology functions. According to Cap Gemini Ernst & Young, nearly a third of U.S. banks now use application service providers for some technology work. In Europe, the figure is closer to 40%.