Description
The financial services industry is constantly and rapidly changing, making it more and more challenging for financial institutions to keep up with the changes—and with the competition.
Major applications of business intelligence
software in the ?nancial services industry
Business Intelligence and Financial Services
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. The Financial Services Industry: New Customers, New Acquisitions, New Regulations . . . . . . . . . . . . . . 2
3. Industry Factors Driving Business Intelligence Solutions at Financial Services Companies . . . . . . . . . 3
4. Applying Business Intelligence to the Needs of Financial Services Companies . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.1. Operational Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.2. Consumer Credit Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.3. Other Application Areas in the Financial Services Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5. Financial Services Organization Snapshots: Fieldstone Mortgage and Redecard . . . . . . . . . . . . . . . . . . . . . . . 7
6. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Business Intelligence and Financial Services
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Major applications of business intelligence software
in the ?nancial services industry
The ?nancial services industry is constantly and rapidly changing, making it more and more challenging for
?nancial institutions to keep up with the changes—and with the competition. With a vast range of customers
and customer needs, changing regulations, and growing fraud threats, ?nancial services companies need
information management solutions that will allow them to make smart decisions. Financial institutions need
to use all the tools at their disposal to manage the many industry challenges and ensure their own ?nancial
stability through intelligent business solutions.
With such a far-reaching scope of services and concerns in the ?nancial industry, ?nancial institutions handle immense
amounts of information. It’s hard to keep track of important information and even to know which information
is valuable, and ?nancial services companies need the tools to take advantage of the myriad information at their
disposal. The information technology available today allows these companies to make better business decisions and to
better target performance goals. MicroStrategy offers the ?nancial services industry the business intelligence software
to report on, analyze, and monitor the vast corporate data through a business intelligence architecture that helps
companies reduce costs, increase revenue, and maximize the value of information.
The Financial Services Industry: New Customers,
New Acquisitions, New Regulations
Financial services companies need to keep up with their constantly changing industry to stay viable and competitive.
As the industry grows, companies’ customer bases expand and diversify. That means more and varied customer
information, making it more dif?cult for companies to understand consumer needs, track trends, identify pro?table
areas, and prevent fraud. Increased customer diversity also means that these companies are always faced with
changes consumer demands. Financial services companies must provide low-cost, personalized, and timely service
across multiple channels, or their customers will simply ?nd it elsewhere.
In addition, many ?nancial institutions are merging with or acquiring insurance companies. While this growth
can bring increased revenue, it also brings a host of new challenges for these ?nancial institutions. First, these
companies are accepting the risks associated with the insurance industry, including huge capital outlays in the event
of natural or human disasters and the possibility of insurance fraud.
Second, when merging with or acquiring insurance companies, ?nancial institutions are also inheriting a wealth of
information on consumer and corporate activity. These new consolidated giants are now dealing with overwhelming
amounts of information from many sources thrown together into one giant pool—a pool that’s becoming
increasingly dif?cult to manage. Companies must manage and utilize the information they inherit in a way that
serves the needs of both their own businesses and of their clients.
Finally, all this merger and acquisition activity gives ?nancial institutions the opportunity to greatly reduce overhead
costs by integrating operational processes. But to make the most of this opportunity, ?nancial services companies
must identify areas where they can increase ef?ciency and reduce redundancies.
The ?nancial services industry is also facing many new regulatory developments. The increasing potential for fraud has
led to regulations requiring ?nancial institutions to monitor for any potentially illegal activity, as well as provide regular
Business Intelligence and Financial Services
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Business Intelligence and Financial Services
and accurate ?nancial reporting. While the new regulations are designed to enhance ?nancial stability and consumer
security, they present new challenges for ?nancial institutions working to stay in compliance. Failure to maintain
regulatory compliance can result in poor credit ratings, dif?culty in attracting investment, and customer loss. Financial
institutions must make sure they have the tools to properly monitor activity and meet reporting requirements.
Industry Factors Driving Business Intelligence
Solutions at Financial Services Companies
Faced with the above challenges ?nancial services companies are forced to be proactive in managing and
utilizing corporate data if they want to keep up with or stay ahead of the competition. That’s where business
intelligence comes in. Business intelligence software gives ?nancial services companies the capability to analyze
the vast amounts of information they already have to make the best business decisions. The software allows
?nancial institutions to tap into their huge databases and deliver easy-to-comprehend insight to improve business
performance and maintain regulatory compliance.
The applications of business intelligence in the ?nancial services industry are far-reaching. First, ?nancial institutions
must manage large volumes of data from many sources, including a diverse customer base, extensive branch
networks, ?nancial advisors, and investors. MicroStrategy’s integrated architecture allows companies to easily
integrate and cross-reference vast amounts of information from multiple sources, identify relationships within the
information, and learn how different factors affect each other and the company’s bottom line.
In addition, a ?nancial services company will have many people in different locations with different skills who
need to use this information for varying purposes—everyone from executives who need high-level customized
summary data with drill-down capabilities to power users who need to create and design custom reports to
data analysts who must identify and communicate market trends. MicroStrategy offers a single, easy-to-use
Web interface that allows multiple users to access the information relevant to them. MicroStrategy’s intuitive
analytical capabilities allow different users to manipulate the data to glean the most from the information that
affects their decision making.
Finally, ?nancial services companies must work to increase revenue while maintaining or reducing costs.
Business intelligence software allows ?nancial services companies to analyze pro?t and loss, including product
sales analysis, campaign management, market segment analysis, fraud pro?ling, and risk analysis. Companies
can grow revenue by maximizing customer value over the long term and improving customer acquisition and
retention. At the same time, companies can reduce costs by managing risk and preventing fraud, as well as
improving operational ef?ciency.
MicroStrategy’s Business Intelligence platform simultaneously accesses immense amounts of information, enabling
analysis from many sources at once and providing the most thorough and integrated reporting. MicroStrategy
then presents this information in user-friendly reports, scorecards, and dashboards and allows users to look at the
information in different ways, offering the simplest and most useful ways to analyze the information to get the
desired results—business strategies that increase pro?ts.
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Applying Business Intelligence to the Needs of
Financial Services Companies
Financial services companies can use business intelligence in many ways, creating smart business solutions across
the myriad challenges in the ?nancial services industry.
OPERATIONAL REPORTING
It is easy for a ?nancial services company to get so focused on outside pro?t building that it overlooks the many
cost-saving opportunities within its own operation. By maximizing operational ef?ciency throughout their entire
organizations—everywhere from the accounting of?ce to the call center to the trading desk—companies can reduce
costs to help them increase and maintain their pro?t margins. MicroStrategy allows users to compare operational
metrics across the enterprise to create accurate, real-time reports that identify areas in need of streamlining. Users
can also create alerts for instant noti?cation of emergency situations requiring rapid response.
Relevant KPIs:
SAMPLE REPORT :
OPERATIONAL REVIEW AGAINST ALL REGIONS
It is essential for ?nancial institutions to understand where they stand against other organizations across the
country, region, or the globe. Using a chart like the one above, an organization can track market share, risk,
?nancial standing, or any other metric that is important for benchmarking.
• Benchmark Comparison
• HR Cost Analysis
• HR Data Tracking
• Financial Analysis
• Operational Spend vs. Risk Analysis
• Daily Dashboard
• Total Accounts
• Open & Delinquent Accounts
RATIO OF TOTAL $$ TO
DELINQUENT $$ WITHIN
THE ORGANIZATION
MARKET SHARE
OF TOTAL $$
MARKET SHARE FOR
ONLY DELINQUENT $$
RATIO OF TOTAL $$ TO
DELINQUENT $$ AGAINST ALL
ORGANIZATIONS IN COUNTRY
VIEW OF DELINQUENT $$ AND
TOTAL $$ FOR ORGANIZATION
ACROSS WHOLE COUNTRY
WHOLE COUNTRY
REGION
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Business Intelligence and Financial Services
CONSUMER CREDIT MANAGEMENT
With increasing customer diversity, ?nancial institutions want to track their customers’ credit habits to discern the
most pro?table avenues and to protect themselves from loss through customer default on credit. MicroStrategy’s
integrated architecture allows companies to analyze customers’ credit activities to uncover new revenue
opportunities through targeted up-sell campaigns and to prevent default through predictive analysis. In addition,
the Gramm-Leach-Bliley Act requires ?nancial institutions to protect their customers’ personal information.
MicroStrategy’s monitoring capabilities allow ?nancial institutions to track customers’ opt-out notices, and its
unique centralized administration and industry-leading security architecture enable ?nancial institutions to ensure
the privacy of the vast amounts of consumer data they collect.
Relevant KPIs:
SAMPLE REPORT :
SUMMARY OF CUSTOMER CREDIT ANALYSIS
As institutions monitor their credit and risk portfolio, they will often use reports like the one above to regularly take
a snapshot of the credit grades of their customer base. As this changes, they can get a feel for the extra risk they
may be facing or drill into customers with improving or declining credit for cross-sell opportunities.
• Outstanding Risk
• Utilized Credit
• Availment (Granted Credit)
• Ratio of Granted to Utilized Credit
• Credit Grade Analysis
• Credit Scores
• WAC (With Approved Credit) Analysis
• Customer Long Term Value
• Risk Grades
• Credit vs. Delinquency
• Credit vs. Purpose
• Purpose vs. Delinquency
SUMMARY OF CUSTOMER CREDIT ANALYSIS
Month Risk Grade Count Current Balance
Pct of Balance
Outstanding
by Month
Current
WAC
FICO
Current
Average
Balance
WA
LTV
2007
01 (Jan)
(UNDEFINED) 94 $16,762,911.12 0.34% 8.55 607 $276,272.96 84.16
A+ 971 $117,498,729.88 2.74% 7.92 651 $232,242.34 89.02
A 43,096 $7,322,615,693.14 84.20% 7.91 677 $244,536.40 85.36
A- 2,652 $373,837,527.28 5.87% 8.18 597 $192,850.49 85.02
B+ 578 $58,732,119.23 0.63% 9.15 550 $169,339.64 90.44
B 1251 $132,734,942.81 2.01% 9.24 581 $173,176.75 81.04
C+ 12 $880,356.21 0.02% 10.11 529 $146,726.03 74.80
C 716 $67,673,615.36 0.74% 10.40 554 $156,734.12 75.30
D 186 $18,514,460.38 0.34% 10.99 568 $157,849.38 66.61
D- 4 $332,488.95 0.01% 8.28 647 $110,829.65 82.40
FICO 785 $158,360,839.28 3.09% 8.35 639 $310,364.39 78.91
Total 50,345 $8,267,943,683.65 100.00% 9.01 600 $197,356.56 85.11
Total 50,345 $8,267,943,683.65 100.00% 9.01 600 $197,356.56 85.11
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Other Application areas in the Financial Services
Industry where Business Intelligence enables enhanced
competitive standing:
ASSET MANAGEMENT
Financial services companies must keep track of extensive and varied assets in many different forms. MicroStrategy’s
analysis and monitoring capabilities allow companies to ascertain which assets are most pro?table, determine how
to maximize pro?tability of their various assets, and ensure that their many assets are properly managed. In addition,
with the consolidation of assets resulting from mergers and acquisitions, business intelligence software allows ?nancial
institutions to identify areas where they can reduce redundancies and drive performance improvements.
RISK MANAGEMENT
Financial institutions need intelligent risk management strategies to meet regulatory requirements, as well as to ensure
their own security. The regulations within the New Basel Capital Accord (Basel II) are driving ?nancial institutions to
determine portfolio risk segments, operational risk levels, and the associated required capital allocation. The reporting
and disclosure requirements of the Sarbanes-Oxley Act have prompted ?nancial institutions to conduct extensive
risk assessments of both internal and external factors. MicroStrategy’s analytical and reporting capabilities allow
?nancial services companies to implement risk management strategies that meet these many needs. Within a ?nancial
institution’s vast data warehouse and data stores there exist immense amounts of information that can help companies
identify potential risk areas and detect fraud. MicroStrategy’s in-depth analytical capabilities make use of this immense
database and data stores and integrate the relevant data into user-friendly reports with useful, actionable information.
MicroStrategy analytics let management uncover internal and external fraud, ensure accountability, and deter fraudulent
activity—actions that ultimately increase margins and reduce e xpenses.
COMPENSATION ANALYSIS
Financial institutions have multi-tiered management con?gurations, involving complex employee compensation
structures, as well as diverse performance goals across the enterprise. MicroStrategy’s integrated platform allows companies
to pull data from multiple sources for more accurate analysis and to support complex incentive compensation plans.
REGULATORY COMPLIANCE
Business intelligence allows insurance companies to identify activities related to fraud and predict potential fraud
before it occurs. MicroStrategy’s in-depth analytical capabilities help insurance companies recognize fraud before
paying fraudulent claims, reducing losses due to fraud and improving recovery rates.
REGULATORY COMPLIANCE
The changing regulatory environment within the ?nancial services industry is requiring ?nancial institutions to
measure and report risk and manage their capital in new ways. International Financial Reporting Standards (IFRS)
requires improved information on ?nancial instruments in ?nancial statements. Basel II is forcing ?nancial services
companies to adopt sophisticated methods for determining risk-adjusted capital, and the Sarbanes-Oxley Act of
2002 calls for accelerated ?nancial reporting and more rigorous disclosures and certi?cations. MicroStrategy’s
business intelligence software consolidates, analyzes, and reports on ?nancial and other enterprise information,
and it allows companies to categorize risk and improve internal controls.
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Business Intelligence and Financial Services
?nancial services organization snapshots
ENTERPRISE STANDARDIZATION AT FIELDSTONE
MORTGAGE
Fieldstone Mortgage Company, a wholly owned subsidiary of Fieldstone Investment Corporation (NASDAQ: FICC),
selected MicroStrategy as its enterprise Business Intelligence standard.
Fieldstone Mortgage initially selected MicroStrategy to provide a small group of users with reporting and analysis
capabilities for critical areas of the business and expanded its deployment to address increased demand for more
reports to more users. As a result of its success with MicroStrategy, Fieldstone Mortgage made MicroStrategy its
Business Intelligence standard for the entire organization.
“ From our ?rst application, we quickly realized the signi?cant bene?ts of MicroStrategy’s reporting and analysis
capabilities. We are delighted to make MicroStrategy available to our entire organization. The ability to rapidly
create reports and modify report content to view different scenarios is extremely valuable in helping us to make
analytically-based business decisions, in real-time.”
Customer Relationship Management at Redecard
Redecard has deployed MicroStrategy software to enhance its customer relationships and increase overall
productivity by improving data access and streamlining the decision-making process. As the company responsible
for capturing and transmitting more than 150 million Brazilian credit and debit card transactions per second,
Redecard needed a business intelligence system to track and analyze detailed transaction and customer data.
The MicroStrategy platform provides Redecard with a better understanding of its market and allows its users to
quickly evaluate and predict customer behavior and opportunities.
“ We chose MicroStrategy as our enterprise-wide standard because it offered the superior analytics and completely
Web-based reporting environment that we required. In order to distinguish ourselves as a service company for
our customers, we must constantly analyze our customer relationships, and the MicroStrategy platform offers the
customer-focused analysis we need to succeed.”
“ The greatest advantage of this application is that there is no more uncertainty—employees know exactly what
to do when they arrive for work every day. To achieve this kind of success with our application and to manage
quick changes in our business and the market, however, we needed extremely ef?cient tools and a reliable ally
with top-quality business intelligence expertise. MicroStrategy addressed these concerns.”
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Business Intelligence and Financial Services
MicroStrategy: The Choice of Leading Financial
Services Companies
At MicroStrategy, we are fully dedicated to helping ?nancial services companies stay competitive in a challenging
industry. We believe that business intelligence properly applied to corporate data provides ?nancial services companies
with the insight they need to increase revenue, reduce costs, and comply with industry regulations and standards.
Today, four of the top ?ve U.S. diversi?ed ?nancial services companies rely on MicroStrategy’s business intelligence
architecture for their reporting, analysis, and monitoring of corporate data. MicroStrategy’s integrated architecture
offers ?nancial services companies far-reaching opportunities for ever-expanding business intelligence. Whether
starting with one or several applications, ?nancial services companies can evolve to utilize MicroStrategy’s unique
capabilities: access for thousands of users, reporting and analysis of tremendous amounts of data across multiple
sources, graphical dashboards and boardroom-quality reports, and unconstrained analytical ?exibility. MicroStrategy
supports ?nancial institution requirements for 24-7 operations, unparalleled data integrity across multiple data
sources, and the highest security levels.
With the constant changes and increasing challenges in the ?nancial services industry, ?nancial institutions need to
stay one step ahead of the competition. MicroStrategy equips companies with the tools they need to make the best
use of the vast amounts of information available to them, allowing them to operate more ef?ciently and increase
revenue. At MicroStrategy, we are committed to helping your company increase its competitive advantage by
devising smart business solutions and making better business decisions every day.
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Business Intelligence and Financial Services
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doc_792771447.pdf
The financial services industry is constantly and rapidly changing, making it more and more challenging for financial institutions to keep up with the changes—and with the competition.
Major applications of business intelligence
software in the ?nancial services industry
Business Intelligence and Financial Services
1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
2. The Financial Services Industry: New Customers, New Acquisitions, New Regulations . . . . . . . . . . . . . . 2
3. Industry Factors Driving Business Intelligence Solutions at Financial Services Companies . . . . . . . . . 3
4. Applying Business Intelligence to the Needs of Financial Services Companies . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.1. Operational Reporting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
4.2. Consumer Credit Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4.3. Other Application Areas in the Financial Services Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5. Financial Services Organization Snapshots: Fieldstone Mortgage and Redecard . . . . . . . . . . . . . . . . . . . . . . . 7
6. Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Business Intelligence and Financial Services
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Major applications of business intelligence software
in the ?nancial services industry
The ?nancial services industry is constantly and rapidly changing, making it more and more challenging for
?nancial institutions to keep up with the changes—and with the competition. With a vast range of customers
and customer needs, changing regulations, and growing fraud threats, ?nancial services companies need
information management solutions that will allow them to make smart decisions. Financial institutions need
to use all the tools at their disposal to manage the many industry challenges and ensure their own ?nancial
stability through intelligent business solutions.
With such a far-reaching scope of services and concerns in the ?nancial industry, ?nancial institutions handle immense
amounts of information. It’s hard to keep track of important information and even to know which information
is valuable, and ?nancial services companies need the tools to take advantage of the myriad information at their
disposal. The information technology available today allows these companies to make better business decisions and to
better target performance goals. MicroStrategy offers the ?nancial services industry the business intelligence software
to report on, analyze, and monitor the vast corporate data through a business intelligence architecture that helps
companies reduce costs, increase revenue, and maximize the value of information.
The Financial Services Industry: New Customers,
New Acquisitions, New Regulations
Financial services companies need to keep up with their constantly changing industry to stay viable and competitive.
As the industry grows, companies’ customer bases expand and diversify. That means more and varied customer
information, making it more dif?cult for companies to understand consumer needs, track trends, identify pro?table
areas, and prevent fraud. Increased customer diversity also means that these companies are always faced with
changes consumer demands. Financial services companies must provide low-cost, personalized, and timely service
across multiple channels, or their customers will simply ?nd it elsewhere.
In addition, many ?nancial institutions are merging with or acquiring insurance companies. While this growth
can bring increased revenue, it also brings a host of new challenges for these ?nancial institutions. First, these
companies are accepting the risks associated with the insurance industry, including huge capital outlays in the event
of natural or human disasters and the possibility of insurance fraud.
Second, when merging with or acquiring insurance companies, ?nancial institutions are also inheriting a wealth of
information on consumer and corporate activity. These new consolidated giants are now dealing with overwhelming
amounts of information from many sources thrown together into one giant pool—a pool that’s becoming
increasingly dif?cult to manage. Companies must manage and utilize the information they inherit in a way that
serves the needs of both their own businesses and of their clients.
Finally, all this merger and acquisition activity gives ?nancial institutions the opportunity to greatly reduce overhead
costs by integrating operational processes. But to make the most of this opportunity, ?nancial services companies
must identify areas where they can increase ef?ciency and reduce redundancies.
The ?nancial services industry is also facing many new regulatory developments. The increasing potential for fraud has
led to regulations requiring ?nancial institutions to monitor for any potentially illegal activity, as well as provide regular
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Business Intelligence and Financial Services
and accurate ?nancial reporting. While the new regulations are designed to enhance ?nancial stability and consumer
security, they present new challenges for ?nancial institutions working to stay in compliance. Failure to maintain
regulatory compliance can result in poor credit ratings, dif?culty in attracting investment, and customer loss. Financial
institutions must make sure they have the tools to properly monitor activity and meet reporting requirements.
Industry Factors Driving Business Intelligence
Solutions at Financial Services Companies
Faced with the above challenges ?nancial services companies are forced to be proactive in managing and
utilizing corporate data if they want to keep up with or stay ahead of the competition. That’s where business
intelligence comes in. Business intelligence software gives ?nancial services companies the capability to analyze
the vast amounts of information they already have to make the best business decisions. The software allows
?nancial institutions to tap into their huge databases and deliver easy-to-comprehend insight to improve business
performance and maintain regulatory compliance.
The applications of business intelligence in the ?nancial services industry are far-reaching. First, ?nancial institutions
must manage large volumes of data from many sources, including a diverse customer base, extensive branch
networks, ?nancial advisors, and investors. MicroStrategy’s integrated architecture allows companies to easily
integrate and cross-reference vast amounts of information from multiple sources, identify relationships within the
information, and learn how different factors affect each other and the company’s bottom line.
In addition, a ?nancial services company will have many people in different locations with different skills who
need to use this information for varying purposes—everyone from executives who need high-level customized
summary data with drill-down capabilities to power users who need to create and design custom reports to
data analysts who must identify and communicate market trends. MicroStrategy offers a single, easy-to-use
Web interface that allows multiple users to access the information relevant to them. MicroStrategy’s intuitive
analytical capabilities allow different users to manipulate the data to glean the most from the information that
affects their decision making.
Finally, ?nancial services companies must work to increase revenue while maintaining or reducing costs.
Business intelligence software allows ?nancial services companies to analyze pro?t and loss, including product
sales analysis, campaign management, market segment analysis, fraud pro?ling, and risk analysis. Companies
can grow revenue by maximizing customer value over the long term and improving customer acquisition and
retention. At the same time, companies can reduce costs by managing risk and preventing fraud, as well as
improving operational ef?ciency.
MicroStrategy’s Business Intelligence platform simultaneously accesses immense amounts of information, enabling
analysis from many sources at once and providing the most thorough and integrated reporting. MicroStrategy
then presents this information in user-friendly reports, scorecards, and dashboards and allows users to look at the
information in different ways, offering the simplest and most useful ways to analyze the information to get the
desired results—business strategies that increase pro?ts.
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Applying Business Intelligence to the Needs of
Financial Services Companies
Financial services companies can use business intelligence in many ways, creating smart business solutions across
the myriad challenges in the ?nancial services industry.
OPERATIONAL REPORTING
It is easy for a ?nancial services company to get so focused on outside pro?t building that it overlooks the many
cost-saving opportunities within its own operation. By maximizing operational ef?ciency throughout their entire
organizations—everywhere from the accounting of?ce to the call center to the trading desk—companies can reduce
costs to help them increase and maintain their pro?t margins. MicroStrategy allows users to compare operational
metrics across the enterprise to create accurate, real-time reports that identify areas in need of streamlining. Users
can also create alerts for instant noti?cation of emergency situations requiring rapid response.
Relevant KPIs:
SAMPLE REPORT :
OPERATIONAL REVIEW AGAINST ALL REGIONS
It is essential for ?nancial institutions to understand where they stand against other organizations across the
country, region, or the globe. Using a chart like the one above, an organization can track market share, risk,
?nancial standing, or any other metric that is important for benchmarking.
• Benchmark Comparison
• HR Cost Analysis
• HR Data Tracking
• Financial Analysis
• Operational Spend vs. Risk Analysis
• Daily Dashboard
• Total Accounts
• Open & Delinquent Accounts
RATIO OF TOTAL $$ TO
DELINQUENT $$ WITHIN
THE ORGANIZATION
MARKET SHARE
OF TOTAL $$
MARKET SHARE FOR
ONLY DELINQUENT $$
RATIO OF TOTAL $$ TO
DELINQUENT $$ AGAINST ALL
ORGANIZATIONS IN COUNTRY
VIEW OF DELINQUENT $$ AND
TOTAL $$ FOR ORGANIZATION
ACROSS WHOLE COUNTRY
WHOLE COUNTRY
REGION
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CONSUMER CREDIT MANAGEMENT
With increasing customer diversity, ?nancial institutions want to track their customers’ credit habits to discern the
most pro?table avenues and to protect themselves from loss through customer default on credit. MicroStrategy’s
integrated architecture allows companies to analyze customers’ credit activities to uncover new revenue
opportunities through targeted up-sell campaigns and to prevent default through predictive analysis. In addition,
the Gramm-Leach-Bliley Act requires ?nancial institutions to protect their customers’ personal information.
MicroStrategy’s monitoring capabilities allow ?nancial institutions to track customers’ opt-out notices, and its
unique centralized administration and industry-leading security architecture enable ?nancial institutions to ensure
the privacy of the vast amounts of consumer data they collect.
Relevant KPIs:
SAMPLE REPORT :
SUMMARY OF CUSTOMER CREDIT ANALYSIS
As institutions monitor their credit and risk portfolio, they will often use reports like the one above to regularly take
a snapshot of the credit grades of their customer base. As this changes, they can get a feel for the extra risk they
may be facing or drill into customers with improving or declining credit for cross-sell opportunities.
• Outstanding Risk
• Utilized Credit
• Availment (Granted Credit)
• Ratio of Granted to Utilized Credit
• Credit Grade Analysis
• Credit Scores
• WAC (With Approved Credit) Analysis
• Customer Long Term Value
• Risk Grades
• Credit vs. Delinquency
• Credit vs. Purpose
• Purpose vs. Delinquency
SUMMARY OF CUSTOMER CREDIT ANALYSIS
Month Risk Grade Count Current Balance
Pct of Balance
Outstanding
by Month
Current
WAC
FICO
Current
Average
Balance
WA
LTV
2007
01 (Jan)
(UNDEFINED) 94 $16,762,911.12 0.34% 8.55 607 $276,272.96 84.16
A+ 971 $117,498,729.88 2.74% 7.92 651 $232,242.34 89.02
A 43,096 $7,322,615,693.14 84.20% 7.91 677 $244,536.40 85.36
A- 2,652 $373,837,527.28 5.87% 8.18 597 $192,850.49 85.02
B+ 578 $58,732,119.23 0.63% 9.15 550 $169,339.64 90.44
B 1251 $132,734,942.81 2.01% 9.24 581 $173,176.75 81.04
C+ 12 $880,356.21 0.02% 10.11 529 $146,726.03 74.80
C 716 $67,673,615.36 0.74% 10.40 554 $156,734.12 75.30
D 186 $18,514,460.38 0.34% 10.99 568 $157,849.38 66.61
D- 4 $332,488.95 0.01% 8.28 647 $110,829.65 82.40
FICO 785 $158,360,839.28 3.09% 8.35 639 $310,364.39 78.91
Total 50,345 $8,267,943,683.65 100.00% 9.01 600 $197,356.56 85.11
Total 50,345 $8,267,943,683.65 100.00% 9.01 600 $197,356.56 85.11
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Business Intelligence and Financial Services Business Intelligence and Financial Services
Other Application areas in the Financial Services
Industry where Business Intelligence enables enhanced
competitive standing:
ASSET MANAGEMENT
Financial services companies must keep track of extensive and varied assets in many different forms. MicroStrategy’s
analysis and monitoring capabilities allow companies to ascertain which assets are most pro?table, determine how
to maximize pro?tability of their various assets, and ensure that their many assets are properly managed. In addition,
with the consolidation of assets resulting from mergers and acquisitions, business intelligence software allows ?nancial
institutions to identify areas where they can reduce redundancies and drive performance improvements.
RISK MANAGEMENT
Financial institutions need intelligent risk management strategies to meet regulatory requirements, as well as to ensure
their own security. The regulations within the New Basel Capital Accord (Basel II) are driving ?nancial institutions to
determine portfolio risk segments, operational risk levels, and the associated required capital allocation. The reporting
and disclosure requirements of the Sarbanes-Oxley Act have prompted ?nancial institutions to conduct extensive
risk assessments of both internal and external factors. MicroStrategy’s analytical and reporting capabilities allow
?nancial services companies to implement risk management strategies that meet these many needs. Within a ?nancial
institution’s vast data warehouse and data stores there exist immense amounts of information that can help companies
identify potential risk areas and detect fraud. MicroStrategy’s in-depth analytical capabilities make use of this immense
database and data stores and integrate the relevant data into user-friendly reports with useful, actionable information.
MicroStrategy analytics let management uncover internal and external fraud, ensure accountability, and deter fraudulent
activity—actions that ultimately increase margins and reduce e xpenses.
COMPENSATION ANALYSIS
Financial institutions have multi-tiered management con?gurations, involving complex employee compensation
structures, as well as diverse performance goals across the enterprise. MicroStrategy’s integrated platform allows companies
to pull data from multiple sources for more accurate analysis and to support complex incentive compensation plans.
REGULATORY COMPLIANCE
Business intelligence allows insurance companies to identify activities related to fraud and predict potential fraud
before it occurs. MicroStrategy’s in-depth analytical capabilities help insurance companies recognize fraud before
paying fraudulent claims, reducing losses due to fraud and improving recovery rates.
REGULATORY COMPLIANCE
The changing regulatory environment within the ?nancial services industry is requiring ?nancial institutions to
measure and report risk and manage their capital in new ways. International Financial Reporting Standards (IFRS)
requires improved information on ?nancial instruments in ?nancial statements. Basel II is forcing ?nancial services
companies to adopt sophisticated methods for determining risk-adjusted capital, and the Sarbanes-Oxley Act of
2002 calls for accelerated ?nancial reporting and more rigorous disclosures and certi?cations. MicroStrategy’s
business intelligence software consolidates, analyzes, and reports on ?nancial and other enterprise information,
and it allows companies to categorize risk and improve internal controls.
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?nancial services organization snapshots
ENTERPRISE STANDARDIZATION AT FIELDSTONE
MORTGAGE
Fieldstone Mortgage Company, a wholly owned subsidiary of Fieldstone Investment Corporation (NASDAQ: FICC),
selected MicroStrategy as its enterprise Business Intelligence standard.
Fieldstone Mortgage initially selected MicroStrategy to provide a small group of users with reporting and analysis
capabilities for critical areas of the business and expanded its deployment to address increased demand for more
reports to more users. As a result of its success with MicroStrategy, Fieldstone Mortgage made MicroStrategy its
Business Intelligence standard for the entire organization.
“ From our ?rst application, we quickly realized the signi?cant bene?ts of MicroStrategy’s reporting and analysis
capabilities. We are delighted to make MicroStrategy available to our entire organization. The ability to rapidly
create reports and modify report content to view different scenarios is extremely valuable in helping us to make
analytically-based business decisions, in real-time.”
Customer Relationship Management at Redecard
Redecard has deployed MicroStrategy software to enhance its customer relationships and increase overall
productivity by improving data access and streamlining the decision-making process. As the company responsible
for capturing and transmitting more than 150 million Brazilian credit and debit card transactions per second,
Redecard needed a business intelligence system to track and analyze detailed transaction and customer data.
The MicroStrategy platform provides Redecard with a better understanding of its market and allows its users to
quickly evaluate and predict customer behavior and opportunities.
“ We chose MicroStrategy as our enterprise-wide standard because it offered the superior analytics and completely
Web-based reporting environment that we required. In order to distinguish ourselves as a service company for
our customers, we must constantly analyze our customer relationships, and the MicroStrategy platform offers the
customer-focused analysis we need to succeed.”
“ The greatest advantage of this application is that there is no more uncertainty—employees know exactly what
to do when they arrive for work every day. To achieve this kind of success with our application and to manage
quick changes in our business and the market, however, we needed extremely ef?cient tools and a reliable ally
with top-quality business intelligence expertise. MicroStrategy addressed these concerns.”
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MicroStrategy: The Choice of Leading Financial
Services Companies
At MicroStrategy, we are fully dedicated to helping ?nancial services companies stay competitive in a challenging
industry. We believe that business intelligence properly applied to corporate data provides ?nancial services companies
with the insight they need to increase revenue, reduce costs, and comply with industry regulations and standards.
Today, four of the top ?ve U.S. diversi?ed ?nancial services companies rely on MicroStrategy’s business intelligence
architecture for their reporting, analysis, and monitoring of corporate data. MicroStrategy’s integrated architecture
offers ?nancial services companies far-reaching opportunities for ever-expanding business intelligence. Whether
starting with one or several applications, ?nancial services companies can evolve to utilize MicroStrategy’s unique
capabilities: access for thousands of users, reporting and analysis of tremendous amounts of data across multiple
sources, graphical dashboards and boardroom-quality reports, and unconstrained analytical ?exibility. MicroStrategy
supports ?nancial institution requirements for 24-7 operations, unparalleled data integrity across multiple data
sources, and the highest security levels.
With the constant changes and increasing challenges in the ?nancial services industry, ?nancial institutions need to
stay one step ahead of the competition. MicroStrategy equips companies with the tools they need to make the best
use of the vast amounts of information available to them, allowing them to operate more ef?ciently and increase
revenue. At MicroStrategy, we are committed to helping your company increase its competitive advantage by
devising smart business solutions and making better business decisions every day.
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