IBS Core Values Still Winning the War in Collections Automation
IBS Collections Software
Helps Michigan banks meet Technology needs.
Story on page 26 May 2010 Vol. 22, No. 5
IBS Core Values Still Winning the War in Collections Automation
It is not every day that we encounter successful software firms who embody the traditional USA "bootstrap" story, especially while maintaining core values like Integrity and Putting The Customer First. It may not be particularly surprising to find that a New Hampshire based firm like IBS is one of those companies. But what is impressive, given the nature of their business, is that they have not succumbed to venture capital firms, and haven't sold out to one of many processor offers to take over the business. IBS remains a rare breed; privately held, focused on unmatched customer service, and dedicated to one thing and one thing only -- IBS provides collections and recovery software to financial institutions nationwide.
After six years as a lead developer for a core banking company in the mid 1980s, Robert Daley moved on to serve as the SVP of MIS at St Mary's Bank, in Manchester NH. Often tasked with vetting software solutions to better compliment the bank's Jack Henry core, Rob found himself having a difficult time locating a program to help organize and automate collections activity. Multiple nights and weekends later, in September of 1989, COLLECTION MANAGEMENT SYSTEM™ (CMS™), a Microsoft Windows delinquent account collection system, was born in the basement of Rob's New London home. A few months later, IBS signed its first client, Northfield Savings Bank, a Jack Henry core banking client in Northfield Vermont.
In 1994, ASSET RECOVERY MANAGER™ (ARM™) was added for managing charge-offs and nonaccruals – creating, when paired with CMS™, the COLLECTION AND ASSET RECOVERY MANAGER ™ (CARM™).
Today, nearly 21 years after being launched in a home basement, IBS is the dominant collection and recovery automation provider in the US. Northfield Savings Bank, IBS' first client, has been joined by nearly 800 other financial institutions who have licensed the IBS system for their collections and recovery automation needs. IBS remains the only firm exclusively dedicated to this market space.
Integrity and Purpose Above all Else.
Daley has seen a number of competing companies enter (and eventually exit) the collections software space. Most firms have either been acquired, or have been forced to seek capital from outside investors. Inevitably, their overall customer experience has been affected and the final results are; a poorly supported product, an inconsistent ability to satisfy customers, and pressure to sell at any cost to get or keep their limited market share. IBS still holds fast to a traditional
New Hampshire value, that solid products and service at a fair price, consistently delivered over the long haul will result in a stable, happy and organically growing client base.
It is no surprise that there have been a number of offers to acquire the successful firm in the past decade. And even less surprising is the phone ringing at least once week, with Venture Capital companies eager to "invest" in the technology. But IBS has seen what happens when short term income demands of Venture Capital firms force companies into actions that may not be in the best interest of their customers, their employees, or long term, themselves.
Not only does Rob have high standards for himself, but he holds even higher standards for the IBS sales team.
Sales, as a profession, can be a challenging one –many people view those in a sales role as less-than truthful, with a "say-anything-to-get-the-sale" mentality. That stereotype is far from the truth at IBS – there, being a sales person remains a proud and respected role. IBS sales professionals do not do "feature show + tell" performances, followed by relentless hounding calls and emails. Rob also insists that the sales team "never sells futures". He is adamant that IBS only represent what they have on the shelves at that moment, and that they do not promise features and functionality that don't exist.
Amber Elizabeth Gest is a Director of Regional Sales at IBS, and she is responsible for working with the Michigan market. Amber consults with institutions that are new to collections automation, as well as maintains and services the relationships with existing clients. Some Michigan institutions currently leveraging the IBS system are; Hastings City Bank, Byron/Chemical Bank, Choice One Bank, Edgewater Bank, West Shore Bank, Macatawa, and Northpointe Bank.
Current Economic Climate
The US financial market is facing one of the toughest struggles it has had to endure, and Michigan is on the front line. According to RealtyTrac.com, in March of 2010 there were 100,791 foreclosure homes in Michigan, with 1 in every 256 housing units receiving a foreclosure filing. Macomb County was hardest hit with 1 in every 153 homes receiving a filing. Michigan Bankers are seeing skyrocketing delinquencies, increased bankruptcy filings, and an influx of REO properties. Many institutions are now finding themselves managing much of their portfolio in excel spreadsheets – tracking expenses and credits, managing collections activity, and creating reports for executive management. These manual and semi-manual practices are often time consuming, and error prone.
Scott Cooke is the Assistant Vice President of Special Assets at Northpointe Bank, an IBS client in Grand Rapids. Scott explains, "IBS has enabled Northpointe Bank to integrate our REO functions that were formerly managed through the use of many Spreadsheets. The integration with our core banking system has allowed us to efficiently track mortgage loans from the moment they miss a payment through non-accrual, foreclosure, bankruptcy, ORE sales and then recovery collection for deficiencies/judgments that are obtained as a result. The ability to customize the application/reports to suit our needs has been pivotal, in these challenging economic times, to effectively managing our loan portfolio versus the traditional pre-programmed "boxed" applications which limit the user's ability to make system changes without waiting for the next release."
The IBS system of today offers:
• Powerful and Flexible Account Queuing
• Custom Workflow Automation (prompting the correct collections action or follow up)
• Automated Charge off, BK, Foreclosure and REO Management
• Centralized Tracking of Collections and Loan Officer Activities
• Automated Collections Letters and Notices
• Automated Reporting (Board Reports, Collections Activity, Watch List, Loan Loss, etc)
• Payment Processing (Check or Debit Card Pay-by-Phone)
Additionally, IBS' unmatched flexibility allows for complimentary product and service integration – providing collections and recovery staff access to useful tools without leaving the collection system.
IBS has partnered with a number of 3rd party vendors, integrating many powerful tools into the IBS system. One of the most popular is the automated voice messaging system from SoundBite. This technology provides a cost effective solution for combating heavily increasing collections volumes, without increasing the number of collections FTEs. SoundBite delivers professionally recorded outbound debtor messages to a custom configured queue of accounts, instructing the debtor to contact the bank. The system automatically detects answering machines, disconnected numbers, and verifies right-party contact - and of course, all call details and results are fully documented within the IBS system for tracking and reporting. More individual accounts are reached in less time, and the number of inbound client-initiated calls increases – all for a
fraction of the cost of a new hire.
Another tool which a number of IBS clients are applauding is the integration with LexisNexis. From skip trace and collect-ability scoring, to tracking bankruptcies with immediate notice of BK filing or status change -- the LexisNexis products offer an arsenal of tools which help speed and direct collections workload.
Imaging integration has become an increasingly important function in collections software, as collectors are looking for integrated access to all imaged documents at the institution, not just letter documentation. With the ability to feed an institution-wide imaging system with debtor letters and collection reports, the IBS system allows the collector to look at the original loan application and other stored documents within the institutions' imaging system.
Every company touts their customer service as topnotch, but it takes a very special company to deliver it. A key indicator that IBS is a different type of company is the consistent customer feedback regarding their Client Services department.
The Support team, led by Nancy Clark, IBS Support Manager, has received rave reviews by old and new clients alike. In the first quarter of 2010, the IBS support team resolved 511 support calls, with Priority 1 support issues (urgent technical issues) being closed in an average of 2.5 hours. In April, a total of 97 support calls were resolved, with Priority 1 support issues being resolved in 30 minutes! Hastings City Bank, in Hastings, MI, has been an IBS client since 2001. Tammy Brumm, Collections Manager at HCB, explains that the Support at IBS is "exceptional", and gives Nancy tremendous praise. "We have recently upgraded our program and have had trouble with the Month End Reports.... Nancy has been working on these issues and
making the needed changes as quickly as possible."
IBS is having a record year. Rob acknowledges that the current economy has helped create much more demand for the product. He is pleased with his company's consistent performance over the past 21 years. "A handshake seals the deal. You keep your word. You treat employees, customers, even competitors with respect. You listen to your gut, to your mothers teachings – and
you do the right thing".