First Financial Bankshares: Small Bank, Big Innovation

Conventional wisdom states that community banks can't offer cutting-edge, innovative technology products as the big banks do, but they make up for that with more personal customer relationships. According to Jeff Casey, it doesn't have to be a case of sacrificing one for the other.

"We are a community bank and we pride ourselves on being involved in the community and being that local bank, but when it comes to technology we feel we are competing with the big banks," says Casey, senior VP of alternate delivery channels for First Financial Bankshares (Abilene, Texas; $4.9 billion in assets).

Casey says small banks can -- and indeed, must -- offer the same technology products to customers that large banks do, especially when it comes to mobile. Accordingly, Casey and his team of around 30 professionals have helped roll out an impressive array of mobile services for a community bank. First Financial operates 66 branches, primarily in Texas.

As 2012 dawned, First Financial didn't even have a mobile app, although it was in the works. Initially First Financial looked at mobile as an extension of online banking, Casey says, but quickly realized "that we needed to look at mobile as a strategic channel that's separate from online." After issuing an RFP, First Financial chose a mobile product from Austin, Texas-based Malauzai Software and rolled out its first mobile offering in March 2012. Mobile adoption soon skyrocketed, and Casey knew he had to add even more of the innovative mobile functionality that his customers desired. In November 2012, First Financial added a mobile remote deposit capture capability. And in January of this year, the bank partnered with Allied Payment Network, which leverages Mitek's Mobile Photo Bill Pay technology, on a mobile bill payment application that enables customers to pay bills using the camera on their mobile devices. First Financial was the first bank in the country to roll out this photo bill pay system, according to Casey.

More than 2,000 payments have been made via mobile bill pay so far, and Casey believes it to be an extremely important product. "Bill pay is a sticky product," he says. "If a new customer already has bill pay set up at another bank, they don't have to re-create everything inside our bill pay system, just snap a picture one time."

Which Way For Mobile Payments?

Though it has offered mobile banking for less than two years, First Financial has around 30,000 registered mobile banking users, about 30% of its online base. Additionally, Casey notes that between 5,000 and 7,000 of those are mobile-only customers, including not just new customers, but existing ones who switched to the mobile channel completely. Mobile also has produced a cost savings for the bank. Casey examined dollar amounts associated with customer transactions in each channel -- call center, branch, ATM and online banking -- and estimated that shifting some transactions to lower-cost channels, such as mobile, saved the bank $300,000.

But the mobile revolution at First Financial is only just beginning. Casey says he is exploring a mobile payment solution. "Right now we're in talks with vendors and figuring out which directions we want to go in," he adds.

Casey sees mobile payments as a "game changer" in the banking industry. "The customer really wants that convenience," he says. "And when you can pair it with relevant, targeted, timely marketing, that's a huge value add."

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Casey also believes in the promise of big data will be essential for First Financial. "We have an opportunity to combat the nontraditional competitors, like Google, by utilizing all the data we have," he says. "Banks have traditionally looked at data in a transaction-based way, but instead we need to use data to build a better profile of our customers. The technology is at a point, with all the data analytics tools available, where banks can get closer to managing the entire financial relationship with the customer."

Casey says that today delivery channels are very segmented, and mining big data effectively can help banks get a better view of what customer preferences are. "Right now, banks have a difficult time getting down to the 'why?' of when a customer does something," he says. "The challenge is getting that." To that end, a big project for Casey in 2014 will be utilizing the information the bank has to provide value-added products to its customers. This will include things such as merchant-funded rewards programs and geographically relevant advertising.

[Apple: Always the Elephant in the Mobile Payments Room]

Another big project on the horizon is a standardization effort. First Financial has recently transitioned from being a bank holding company, where its subsidiary banks each had different systems in place, to becoming a single-charter bank. "So we're looking across the organization and standardizing our processes, and that involves bringing together a lot of different systems previously in use," he notes.

Casey is also planning for an eventful 2014 in his personal life: He is set to welcome his first child into the world in October. "Right now we're spending a lot of time getting ready to have a little one in the household," he says.

Casey, also a history buff, says spending time with his family "is the foundation for a good work-life balance."

Personal Snapshot

Jeff Casey

Senior VP of alternate delivery channels, First Financial Bankshares

Size of IT organization: About 30 people

Prior roles: Special projects manager, First Financial Bankshares, various technology management roles working primarily in the chemical industry

Education: B.B.A. from Texas A&M University; graduate of the Texas Tech Banking School in Lubbock, Texas

Hobbies: History buff

Bryan Yurcan is associate editor for Bank Systems and Technology. He has worked in various editorial capacities for newspapers and magazines for the past 8 years. After beginning his career as a municipal and courts reporter for daily newspapers in upstate New York, Bryan has ... View Full Bio