Advanced Analytics Driven Business Enablement (Citizens)

Hear from Citizens Bank on how they built and scaled a new product offering around HELOC, bringing together capabilities ranging from advanced analytics, marketing, operations and credit policy. 

Steven Bortnick, Consumer Analytics Head, and Adam Boyd, EVP, Head of Home Equity, Credit Card, and Unsecured Lending, from Citizens Bank will share their journey on how they delivered 70% improvement in cycle time with 30% reduction in cost to serve, while improving customer and colleague experience.

Transcription:

Adam Boyd (00:10):
Is the mic on? I guess it is. Hey. All right. Well, thanks for joining everybody. It's a little bit blinding up here, so I can't quite see who all's in the audience, but I appreciate everybody joining at the end of the day. I'm Adam Boyd. I'm from Citizens Bank,

Steven Bortnick (00:27):
Steve Bortnick, Data and Analytics from Citizens bank.

Adam Boyd (00:29):
And I Lead our Home Equity and Unsecured Lending Businesses. We're going to talk a little bit today about the journey we've been on in the home equity lending business over the last few years.

(00:43):
So I took on leadership for the own equity business back in 2020, and in the time I was in the business, I joined the business. The first question and what was really the ultimate head scratcher for me was that we had this product which was very attractively priced, really convenient and flexible borrowing option for customers, but yet nobody seemed to want it. And as we started to dig into the root causes for that, we really found that it wasn't the product itself, it was really the origination experience. If you think about the traditional home equity origination experience, it looks a lot like a mortgage, but the product itself is not a mortgage from a customer perspective, if you're buying a home, you don't have a lot of options outside of a traditional mortgage product. If you're looking to borrow $50,000, you have lots of options. And so what we were increasingly seeing were customers who were choosing more convenient options over the traditional painful home equity experience to access funds. And so we had this hypothesis that if we could deliver a home equity product with an origination experience that looked and felt like an unsecured personal loan, we'd have a real winner on our hands. And so that was the genesis of Citizens Fast Line.

(02:08):
Now I'm going to start with the results and then we're going to spend the rest of the time talking about the how and the what and how we delivered an experience that again, looks a lot like an unsecured experience, but for a secured home equity line of credit. But we launched the product back in 2021, and the results have really exceeded expectations. We look at results really through three lenses from a customer perspective. We're seeing record marketing response, and we're also seeing NPS that's been really consistently north of 80 since we launched the product. The average is 82, the most recent vintages are at 85 or better in a lot of cases. From an operational perspective, we've reduced our cycle times by more than two thirds. We now have the best cycle time in the industry. When you look at us relative to our bank peer set, our pull through rate up 40%.

(03:01):
And so that's the percentage of applications that actually result in the book loan. Again, 40% improvement to massive improvement over what we were delivering previously. And then importantly, colleague satisfaction has improved. When you look at financial performance, we've reduced our cost to originate a loan. So our manufacturing cost is down by 30%. That's over $300 in cost savings per book loan. So on a scale of 50,000 originations a year, it's a pretty substantial cost savings. And then perhaps most importantly is the fact that we've been able to grow originations. We've now delivered now 13 consecutive quarters of positive balance growth in the home equity business, which is really unheard of in the industry.

(03:43):
And so how do we do it? We did it really with an end-to-end transformation. I think the biggest misconception about Citizens Fast Line is that we just took a digital wrapper and put it on the same old home equity origination experience that couldn't be further from the truth. We really took an end-to-end approach to re-imagining the business, and there's really no aspect of the experience that we didn't touch. If you look at the left-hand side of this slide that's on the screen here, you can see sort of that representative customer journey. There's really two flavors of the experience that are in market today. There's the first where we've got an existing customer, we essentially know everything we need to know in order to underwrite the loan at the point of sale, and we're able to go to that customer with a very specific offer, pre underwrite the loan and essentially originate in a single click.

(04:29):
And so we've turned the job of the underwriter in the back office into more of a QA QC function as opposed to actually decisioning the loan. Second flavor is the walk-in experience. So customer shows up, they could be a prospect, they could be an existing citizens' customer. They show up and they tell us they're looking for a home equity at the point of sale on the spot. We go through the exact same pre-underwrite experience and we're able to pull together all of the data needed to decision alone at that point of sale and deliver it to the underwriter to allow for a quicker origination experience for the borrower. And so you could see some of the stats there. It's five minutes or less to complete the online application, and the simplest loans are getting approved in less than seven days. Median is under 10 days, and so very, very fast cycle times much faster than what you would see in any of the industry data around home equity across the industry today. We continue to see average cycle times that are in the 40, 45 day range. And so we're at a point now where we really have the very best experience in the industry. And again, it's really something that's resonating with customers. And so let me pause there. I'll hand it off to Steve to talk a little bit more about the how, because when you look across the board and all the steps that we took to deliver the experience, really all of it is analytics enabled.

Steven Bortnick (05:45):
Alright, I'll take that too. Thank you Adam. Good handoff. Everybody hears me. Okay, so good afternoon everybody. Thank you for your interest in this topic that we've been very passionate about over the last few years and had a really strong partnership with McKinsey to help support us on this journey as well. This is actually a good segue slide. I think where I'm going to back up from this slide a little bit and I'm going to double down on a couple points that Adam made for us. Number one, and this is really a key point and a key principle for how we did this is we did not think about this like a traditional mortgage product. So audience, anybody have a mortgage on a home or have a home equity or ever work in that part of the business, you kind of know how it works.

(06:26):
You kind of get a sense of that from a documentation standpoint, from a compliance standpoint, from a requirement standpoint. So that's really a key point. That was the essence of the journey right there. Second point I would like to make is every element on here is mission critical. None of them are more or less important than the other. And in of themselves, I've seen plenty of analytics partners, marketing partners, operations partners, credit risk partners come in with their version of the solution and it's always a version of painting around the edges or adding a little lipstick to the existing system, maybe moving the needle a little bit. But if you put all that together and if you think end to end, that's really where the magic can come out of that. So with that set, I'll go to the next page. This for me and I'll try to paint a picture here.

(07:20):
This is the meat, the potatoes, the vegetable, the drink, the espresso after this is it. This is everything Pie. What's that key lime pie. I should have gone with the key lime pie. That was the key lime pie earlier.

Adam Boyd (07:35):
Excellent, excellent. Highly recommend.

Steven Bortnick (07:37):
Should have gone with the key lime pie. And this might sound a little bit rote, but it's actually true. You hear a lot of people talk about have a vision. What I would say that's very related to that comment is think with the end in mind. Think with the end in mind as you're trying to build out this solution, and this should look familiar to a lot of people who have been in the industry or again, who have gone through the process as a homeowner, as a consumer yourself. So if you're thinking with the end in mind, from my point of view, that started with how does it work?

(08:07):
How has it worked historically? So you've got a borrower, they're sitting in a branch or wherever they are or a prospective borrower and they sit down and they have a consult with a colleague, with a banker, and they say to themselves and they reach a conclusion, yeah, I think a home equity line of credit would be a good solution for my financial needs where I'm at in my journey. Then you say, okay, well let's start the application process. And that begins a process where you turn on an operational team, you start collecting documents. There's a variety of documents that are needed. You need to schedule an appraisal to figure out what the collateral's worth. You need to pull credit history for husband, for wife, for the borrowers that are going to be on the loan that own the property. You need to clear title, you need to think about insurance.

(08:52):
There's a variety, right? I've only touched on half of it, but I always imagined that you'd have an operational processing team that would gather all that up, and a lot of that had to come from the customer, from the consumer, the prospective borrower, and they had to do a lot of work in that process. And then they'd put together this package and they'd hand this little package to an underwriter. Right Now I'm getting to the end think with the end in mind and the underwriter sits down with the package and says, yep, everything's there. Let me see what the numbers look like. The home has worked this, the credit is of high quality. Let me get out my little policy paper here and let me do the math. Look at that. I can do something for these borrowers. Here's what I can do. And then they work that answer backwards to the consumer.

(09:37):
That takes time, that takes effort, that takes documents, that takes energy. So if that's the end state, the end goal, the idea here was to effectively turn all of that into data, have as much of that data available to you before the borrower ever even shows up and knows that they're interested in that. You have that waiting real time to be able to leverage. But then where the analytics really comes into play is how do I need to transform that data? How do I need to combine that data? How do I bring together borrower one, borrower two, and a piece of collateral? How do I bring in the policy, the pricing to actually say, here's exactly what I can do for you, or here are the options of what I can do for you. That became the engine. I saw a nice presentation this morning that spoke to the idea of data AI factory intelligence.

(10:32):
This to me was the old school way of getting to that intelligence. How do I take all my data requirements? How do I manufacture that into intelligence that I can use for this purpose? With that end goal in mind, I'm trying to underwrite before you ever show up and know that you even want the loan. Unfortunately, we had to do it the old school way. We don't have an AI factory in place, but the old school way is just roll up your sleeves, do a lot of analytic work, do a lot of data science work, do a lot of data engineering work, get all that available, and then we'll talk about a couple other principles and things like that. So that's really the story to tell here.

(11:12):
So going to the next slide, what are we talking about here? Omnichannel customer experience? What I would say here for our journey, you might want to jump in here too. We might want to start the tag team. I'll start It is, with everything I just described and everything Adam just described, it might've been easier to say, you know what? Forget the old scrap that we're just going to start all over. But that really wasn't the need or the requirement here. Really the requirement was to look at our existing partnerships, look at our existing systems and try to figure out how we can work within that. And there's a little bit of an art to that. You're trying to leverage capabilities and solutions that will work for you so that you can take advantage of speed to market. You could take advantage of cost returns and things like that, but if you overdo that, then you find you're spending all of your time trying to shave square edges off of square pegs to fit them into a round hole if you follow that analogy. So you don't want to overdo it one way or the other. And so I think we took advantage of a lot of existing.

Adam Boyd (12:17):
Yeah and I think the other point I would make here is that this development of this experience didn't require us to rip out and replace all of our existing technology. We essentially built an analytic layer that sits on top of the loan origination system and supports the prequalification experience, but doesn't require us to go rip out and replace an LOS. If you've ever been involved in an LOS replacement, it's a multi-year project. Massively expensive. That wasn't necessary here. Yeah.

Steven Bortnick (12:46):
Yeah. So well stated, and I might just leave it at that. I guess maybe the other point I would add for this slide before I go to the next one, and again, necessity is the mother of invention. So with those existing systems, part of the innovation that was occurring here that was leading to the next round of the art of the possible was to say, can we leverage that system? What do we need to adapt? What do we need to change? How do we need to work a little differently for us so that we can take advantage of it here in the flow of the experience that we're trying to create for these customer journeys? So that was the idea, and again, that was a little bit of the art of how to get some of these solutions through to market.

Audience Member 1 (13:27):
How did you orchestrate that if you didn't rip out? I understand why an orchestration system? How did you orchestrate from the legacy though across all orchestrate?

Adam Boyd (13:39):
Yeah, I mean, so the product is essentially the same. Instead of a customer providing a packet of information, we've got a pre-qual engine that sits on top of the loan origination system and it's delivered as data through an API. And so income data that's available at the point of sale can be delivered and entered into the LOS, and I'll be completely transparent and show you behind the curtain. The first instance of this involved essentially a static webpage and people behind the scenes keying information from. So customer had no idea. Customer thought it was a digital experience, it was a digital experience from a customer perspective, but behind the scenes we were making it work by leveraging human beings to enter information and those human beings transition to bots and then from bots to API, which is where we are today, and certainly over the course of those iterations, we became more and more efficient and more and more accurate with data entry, but we found a way to make it work in every single instance. I would say though, the loan origination system did require a little bit of customization, and so we leveraged something we call swim lane codes to identify the speed with which we can originate a loan. There's got to be a landing spot in the origination system for that data point. And so I would say it's more modifications, a little bit of customization to the LOS versus a rip out and replace.

Steven Bortnick (15:03):
The other thing I like about that answer, it's actually consistent with the keynote speak speech that we heard this morning, which was talking about show the value, earn the right. So even if that was clunky behind the scenes, it felt amazing to the customers and that earned the right and the confidence from our organization to say, okay, go on to step two and then go on to step three. And you kind of keep earning that, right? To build, to harden, to optimize, to further expand the solution, which is exactly what happens. So every step of the way, that's a principle I think we talk about this later, which is just that iterative concept. You're never done. You're never holding up a sign that says mission accomplished, it's build great, love it, celebrate what next? What can we do next? How can we make it better? Very consistent with what Adam just said, we're doing okay on time. Right. Okay. Anything else here? Good?

Adam Boyd (15:56):
No, I think that's Good.

Steven Bortnick (15:56):
Not sure what we have next. Oh yeah, this is a good, I can maybe do this real quick. This is a good example because hear a lot on data technology. We just need more data. We need more data, we need more data, right? That's a good talking point. From my point of view as a statistician, as in lifelong financial services analyst, there's a lot in between data and again, AI factory or not intelligence, right? A lot of critical thinking, a lot of work, a lot of blood, sweat and tears that needs to go into that to actually make it meaningful, especially when you get into some more nuanced, really careful, really precise types of use cases like underwriting alone, that's a very sensitive type of use case. So here's an example where we leveraged and took advantage of our internal deposit data. This better than me, but I mean a good chunk of our home equity originations are with our primary retail bank customers.

(16:57):
These are direct deposit customers who deposit their paychecks into their checking account with citizens. They pay their bills out of those accounts. That's very rich data. Everybody probably knows that story has had some version of conversation around it. That's what we're talking about with income here. But how do you analytically translate that into something that you can actually call gross annual income, that you can actually get your risk and your policy teams and your compliance teams to sign off and say, you are allowed to use that to underwrite a loan. That was painful, that was brutal. That was a long journey. That was one piece of the puzzle, and that took a while to get there, but it's a good example of analytics and what it takes to go from data to intelligence. That takes a lot.

Adam Boyd (17:44):
Yeah, I think the other point I would make on this page, especially as you look at everything you need to solve for to originate something as complex as a property secured loan, whether it's a mortgage or a heloc, is that when I talk to others around the industry who have made attempts at simplifying the origination experience, there's this common misconception that the only way to do it is to either sort of narrow your buybacks to only the simplest loans or to cut corners on the origination experience. I would actually argue by solving each of these components through data, we've actually reduced risk, and I think we've got good evidence for that. Another good example is collateral where we moved away from traditional appraisal products to AVMs in the majority of the loans that we originate. ABMS being automated valuation models, so statistical models to calculate the value of the collateral rather than sending an appraiser out. We have good data that the ABMS we're using are actually more accurate than the traditional appraisal products we were using historically. I don't think the regulators have fully come around to that yet, but we've got hard facts that show that that's true. And so I would say in every single one of these instances, I feel good about the fact that not only have we simplified the experience for customers, we've actually reduced the risk that we're taking when we originate loan.

Audience Member 2 (18:59):
How did you guys normalize the income data from this cost transaction? I know that's a big challenge in general in banking is you get a C transferred and it has information on it.

Steven Bortnick (19:11):
Yeah

Audience Member 2 (19:11):
It's hard to distinguish between that's income versus some random deposit, ven or personal suite.

Steven Bortnick (19:20):
Yep, yep.

Audience Member 2 (19:23):
How do you normalize,

Steven Bortnick (19:24):
Identify? So it's not perfect, but it's compliant and it works and it passes, so that's good. And now we have experiential data from the last probably three or four years where we're using it and we have a historical judgment to say, how well are we doing? We've gone back in and made a couple of adjustments along the way. I'd say it's less, it's not a model, it's much more engineering and critical thinking and careful thinking. So for example, one of the requirements was you need a certain history of consistency that requires a definition of consistency. It also requires a, what do you mean, six months, 12 months, two years? Figure that out. What's the definition of consistency? Is it a north and south 10,000, one month, 5,000 the next month that needs to be within some tolerance or above some lower threshold consistency of source.

(20:16):
What's the source record? Who's on the account? Is it two people? Who's in income? Is it, how do you think about that? So you have to work through all those details. What are the sources? You have all kinds of sources. A lot of it's payroll. That's pretty straightforward. A lot of it's not. You have alimony, you have social security, have a variety of things, and some of them have slightly different rule sets. So a lot of engineering analytic thinking and partnering with legal risk and compliance for how you can do that and how you can make that work. Now. You have to have willing partners to get there. I think if you have somebody who's maybe too risk averse and not thinking about solving the problem with you, you're not going to get anywhere. You're just stuck. Good luck. But if you have somebody that's willing to go on that journey, even though it's their role to be the control point and keep you from getting yourself or the institution in trouble, then you can go on that journey with them and they will partner and they will help you. And I would give our legal risk and compliance and some other partners a ton of credit for supporting us on that journey. It's a valuable asset that is monetized for us at this point. So key point,

Audience Member 2 (21:23):
Sorry, are you reaching out to non

Steven Bortnick (21:28):
For this example, what we're showing here for that income source and what we're saying that you have to be a citizen's customer, otherwise we don't have that internal information. But it's the same thing with a plat or a ity or whoever's offering that service. It's just on US data. And for a good chunk of our primary retail customers, oh, it's really good data. This is where they deposit their paychecks and pay their bills, and for a good chunk of that base, these are the folks that are very interested in getting a home equity line of credit with us and taking advantage of that service. But let me touch on that a little bit more and go a little deeper because there's another dimension to the problem we've solved here that a lot of people don't understand and they don't get, even when we don't have all of the data and all of the information and it's not perfectly compliant.

(22:18):
I have a lot of cases where we have a lot of cases where we don't, we have everything but income. There's a ton of value in just that. So part of the solution, Adam touched on swim lanes is if I have a hundred consumers that show up in my pipeline, whether the answer is good, bad, or anywhere in between, I at least know what bucket to put 'em in. And that affects my operational processing. That affects what we queue up next to say, this one's going to take a little longer and it's going to require a little more work. And you give that to the right operational team that then takes it from there versus this one fully pre-baked smooth sailing, we have a wonderful answer for this consumer. Boom, we can close that loan inside of seven days. So just the fact that you have that knowledge to sort everything that shows up versus I only have a solution when everything works out and everything's perfect. That's huge analytic value. A lot of people don't get that part of it.

Adam Boyd (23:14):
Yeah, I would agree. A key part of the value proposition is expectation setting. So at the point of sale, when we deliver an offer, we're not just telling a customer what price they qualify for. We're telling them what price they qualify for, the line amount they qualify for, and how fast they can expect to close their loan. And setting an expectation around cycle time is really, really important, especially when we're seeing our primary competitors as unsecured personal loans.

Steven Bortnick (23:38):
Yeah. Yep, great answer. And you can tell 'em how long it's going to take. You can tell 'em everything they're going to need to do versus not need to do. Everything that goes along with that. You can know when it's an edge case because they're right on the edge of policy, and that's going to be a little dicey. All of that comes into play. We're not giving away the recipe here we

Audience Member 3 (23:57):
Were. You also able to operate then that allows you to optimize your operations.

Adam Boyd (24:02):
Definitely. Totally. Yeah,

Steven Bortnick (24:03):
Totally. It goes hand in hand, which is why I said before, right on that earlier slide, this is not more important than this, less important than that. It's the whole thing. And if you get the chassis, which is why I really went deep on that one page, think with the end in mind, now that becomes your engine and everything works around this engine. That's really the essence of it. And somebody had the vision to see all that through and push all that through. So yeah, what do you want to

Adam Boyd (24:30):
Say? Yeah, I mean, this is just really just the history of our experience in the home equity business. And I think the focus here is that it wasn't a big bang relaunch. This was really an iterative approach. And so we started work on the Fast Line initiative, I don't know, in March. We were live with version one in July of that same year. Again, version one was sort of a static webpage with people keying information behind the scenes. But that allowed us to get started and allowed us to start learning something about the experience and allowed us to start testing different marketing messaging around it. And so we got a huge headstart back in 2021 when we kicked this off to allow us to get to where we are today, and we continue to iterate and optimize on the experience. And so I don't think the work is ever done, but I think that's the key point here.

Audience Member 4 (25:24):
You mentioned the need to partner with risk compliance and bring everybody together to, how did you go about actually building that internal?

Adam Boyd (25:34):
I think that is the culture. That is the culture of the organization, and that's the culture of the team that we built. And it doesn't matter who I'm talking to, whether it's someone in risk, whether it's a regulator, whether it's executive leadership at the bank, the goal of the home equity business is to deliver the very best customer experience period where we started talking about transitioning our value prop from rate led to convenience LED four years ago. And I think everybody at the bank now can recite those talking points. But I think the other key point there is that we weren't willing to sacrifice operational risk, credit risk. And so I think we, everyone acknowledged we weren't willing to cut corners to get there, and we were going to find creative solutions that allowed us to get there in a compliant way. I'll go back to an example a moment ago when we were talking about direct deposit income and Venmo.

(26:24):
Venmo is not a source we'll count for income because of anti-money laundering concerns. And so I could have gone to that and tried to say, Hey, we really need to include this data source because it'll give us 2% additional coverage on direct deposit income and we'll be able to deliver a better experience. But that's not a trade off we would be willing to make. And so I think that's an important point, and I think that's important for getting everyone on board, is ensuring you recognize what every individual at the table is responsible for and ensure that everyone's focused on the same outcome.

Audience Member 4 (26:57):
What's the treatment like? Not customer.

Steven Bortnick (27:04):
If it's not a customer,

Audience Member 4 (27:06):
You don't have the data

Steven Bortnick (27:07):
But we do.

Adam Boyd (27:08):
We have most of the data.

Steven Bortnick (27:10):
I even have cases where we have it all in some cases, right?

Adam Boyd (27:12):
Yeah. But I would say to that point, I mean if you look at the experience that we're delivering across the board, we about 70% or so of what we originate is customer business. The very best version of the experience we deliver requires the customer to enter just a handful of data elements. It really is a one click experience. We can get the majority of those loans closed in seven days or less. If you're a prospect fresh off the street, you show up and you request a home equity line of credit, we can still get that loan closed much faster than anyone else because we have solved collateral, we have solved title, we have solved the longer polls in the tent. I would say the one place where we still have some challenges is on the income side, but even there, if you've got a borrower who's motivated and it's as simple as uploading pay stubs, we can generally get that done very, very quickly as well.

(27:58):
And so I would say across the board, we're delivering a really, really strong experience. I can actually give you a personal example. My sister bought an older home in Long Island a few years ago, and she actually doesn't bank with citizens. She banks with another large national bank, and they actually have a very well-developed home equity business. And so she was in the middle of a renovation a couple of years ago, and she went to her primary bank because she's two thirds of the way through the renovation. She starts running out of money, so she needs a heloc. She goes and applies for the heloc, and she gets approved. She gets a price point that she likes. She gets the line of credit that she likes, but oh, 80 to 120 day cycle time to originate the loan. So she calls me up in a little bit of a panic, I refer her to a loan officer, and we close her loan in 11 days.

(28:48):
And so to me, when I think about that, if you think about the 80 day cycle time they're delivering and the 11 day cycle time we're delivering, it's 11 days of actual work to be done and 70 plus days of inefficiency and waste that hasn't yet been extracted from competitor processes. And that's the way I think about it. And so I think even where we don't have the a hundred percent solution to the point Steve was making earlier, just having 75, 80% of the solution still allows you to get the loan done much more quickly than anyone else.

Steven Bortnick (29:17):
And we have most of that customer or non-customer. Again, income's the most difficult thing, but you can do a pretty good job there too. And we built that into the digital experience for how we want to handle that. So we created what we think is a pretty solid experience. Part of the innovation is can you add other options for the consumer along the way to make that an even better experience? And they can choose how they want to go about that.

Audience Member 5 (29:41):
Are you seeing improved employee retention? I would think that when you're working in a HELOC operation like this, it's a lot more fulfilling to get work done and not though you're spinning your wheels and yada, yada, yada. Yeah,

Adam Boyd (29:59):
Yeah.

Audience Member 5 (30:01):
Are good bankers nowadays? I mean, are you?

Adam Boyd (30:02):
Having Yeah, no, we absolutely are. I mean, we measure employee satisfaction in a couple of different ways. We had some of the survey data. We had done an informal survey of operations colleagues while we were sort of on the journey. The majority of our loan processors reported lower stress, but more formally, we measure employee satisfaction at the company. And home equity continues to have some of the very best employee satisfaction rates at the entire company. And so retention has been really, really strong. And I think the point, it's here on the last bullet point here around hire the right talent, but I think Steve made the joke earlier about sharing the recipe, but I always say it's not the recipe that's important, it's the ingredients. And a key ingredient are the people, not just Steve and I and the other people on the leadership team that are thinking about innovation. It's the actual customer facing colleagues that are on the phone with the customers. And I think about every single time we've looked at NPS and we've tried to understand drivers of NPS and what really matters, one of the most important factors every single time is the colleagues that handled the loan. And so even though we describe this as a digital experience and we've streamlined it, we've made it simpler. We've made the cycle times much, much lower than what anyone else can deliver. The colleague handling the loan and interfacing with the customer really, really matters.

Audience Member 6 (31:27):
Along those lines, are you seeing similar results with expanding wallet share to other areas, this experience?

Adam Boyd (31:34):
Yeah, absolutely. So home equity for us has always been a relationship business. 90% or so of our home equity customers are primary bank relationships for citizens. Since we launched the fast line experience, we've really had much more success with prospecting with the home equity product, and we're seeing pretty strong conversion of those customers into full citizens relationships. We bring about a thousand new customers into the bank every single month leading with a home equity. And the vast majority of those customers also open a checking account and also form a deeper relationship with the bank over time. I think a core component of the value prop with the home equity is that if you get a heloc, you may never need to apply for credit again. Most of the customers who've really figured out how to use a HELOC draw on it multiple times, the most common way to draw is to just go into the mobile app and transfer money into a checking account. And so we've really made sort of the full relationship and embedded component of the heloc. It's not a standalone credit product, it's part of a larger financial management solution, and that's really resonated. We've got our home equity loan officers now selling checking accounts as part of the account opening experience for home equity, and we're having really, really strong success with that.

Steven Bortnick (32:46):
Couple of questions. So last two questions maybe. Are we okay? How do you want to do time? Glad to keep going. Yeah, yeah. Well keep going. Yeah.

Audience Member 1 (32:54):
If you're okay to say what is the next big innovation that you guys are excited about? What's on that last

Steven Bortnick (33:01):
Within this, within home equity, you want to talk about the most recent or you want to talk about where we are going next?

Adam Boyd (33:08):
Well, yeah. So I would say within home equity, I think there's still opportunity to continue solving the puzzle for a larger percentage of customers because again, the very best experience is when you can deliver a fully underwritten file to the underwriter at the first pass. And we can do that for a subset of customers today. I think through partnerships and through additional alternative data sources, we can start to do that for a larger share of our total origination audience. And so I would say that's opportunity one. I think the other place where I think we've got a lot of opportunity is on the servicing experience. And so a lot of work more recently has gone into making for a more seamless transition from the origination experience into the servicing experience. I think the quality of the servicing experience is really what's going to drive deepening over time. I think the home equity product is a wonderful introduction to citizens, but really getting it right in the servicing experience is going to be really important for us as well. And so we're starting to shift our focus a little bit more there. And then I think what Steve was hinting at, we we're intensely focused on our credit card business right now, so nothing to share publicly there right now, but more to come soon.

Steven Bortnick (34:19):
Yeah, that's a version of taking a lot of these principles and making it available for another product. And then just kind of continuing to roll it out. The thing I would add, yeah, you can always innovate on more data, better data, more innovative ways of plugging that in. And you touched on that for sure. And then I think the second bit is we're always looking at, because one thing our organization has done really well is, and everybody talks about it, but customer journeys, customer experience, and we did a really good job here looking at that journey and that experience and saying, what could be a little bit better? Oh, we've got an idea that we want to plug in. Where do you plug it in? And what exactly is that experience and that engagement with the customer look like? Does that improve things materially? Maybe it's a keeper and we'll go for it. If not, it's not worth the lift, right? So it's those kinds of judgments I think at this point. Yeah,

Audience Member 8 (35:05):
You just hit that on it too. But this is a great use case for citizens in terms of going from a reactive approach to a proactive

Steven Bortnick (35:13):
Approach. So

Audience Member 9 (35:14):
Are there other areas of the bank that you're looking at policing the same methodology around being more proactive with your clients?

Steven Bortnick (35:26):
Yes.

Adam Boyd (35:27):
Yeah. Yeah. Answer. The answer is all of them. Every area of the bank, honestly. Yeah,

Audience Member 9 (35:34):
Retail,

Steven Bortnick (35:34):
Right? Even

Audience Member 10 (35:35):
Corporate side side, right?

Adam Boyd (35:38):
You're

Audience Member 1 (35:38):
Looking at taking different data. Maybe not retail data, but corporate data. Small business.

Steven Bortnick (35:46):
Yeah, small businesses. Yeah. I maybe I won't drain it completely here, speak to that a little bit, but we're definitely on a journey there as well. I think the positive for me, in some ways, they're actually out in front at citizens in other ways. It's still brand new. But the positive for me is you've got a very forward looking leadership team that has come in in the last less than a year, and they're really very interested in kind of looking forward, not leaning on the past too much, leverage what they can take advantage of, but really bring it into the future. So there's a lot more energy there and a lot more focus there. And you've got the right leadership, which is a good closing point for me. By the way, I think you were a little modest in your answer is one of the requirements, and we touched on a little bit with getting your partners to come along on the journey, is you do have the right leadership.

(36:35):
Part of the right leadership is analytic thinking and analytic approach to all problems. Well, tons of business decisions that have to be made along the way. You touched on it and you got to do cost benefit constantly. Is it worth it? Is it worth the effort? Oh, yeah. Because it's going to do the following for us. So I think if you're can have analytic leadership, especially at the top of the house, and that's really what you brought to the table, to set the culture, set the tone, give everybody the right sense of the right business decisioning along the way, that made a huge difference here. So I know you're always modest. You're a super modest person, and I'm not just blowing smoke, but you did a lot for the organization to kind of bring that forward. That takes a lot.

Adam Boyd (37:17):
No, I appreciate that. But it really was a team effort, so I don't want to take all the credit. I don't deserve it.

Steven Bortnick (37:26):
Anything good? Call it a wrap. Awesome. Thank you. Thank You.

(37:34):
All.