Business Intelligence

In Banking and Finance

Team Predators
Puneet Gupta 09BM8037
Varun Bajpai 09BM8059
What is BI?
The ability to apprehend the
●

Intelligence interrelationships of presented facts in such a

way as to guide action towards a desired goal.

The use of company data to facilitate decision-making by

Business
●

decision-makers, which means understanding current

functioning and anticipating actions for well-informed
Intelligence steering of the enterprise.

Data 
Information
Why BI?

Without BI companies are likely to :-

●
exceed budgets
●
miss expectations
●
improper usage of funds among various depts
●
miss sales opportunity
●
ignore profitable markets
●
focus on less performing products and services
●
neglect measurable metrics
Why BI?
Companies often find themselves in precarious position due to many factors such
as…

Lacking visibility across Lacking depth of analysis

Lacking insight to the enterprise
operational inefficiencies difficult to
take longer to coordinate activities
identify and address across departments,
issues divisions, partners,
and customers
miss seeing
abnormal variances
and understanding
root causes that have
material impact on
earnings
Why BI?

Without BI, Companies end up with ….

●
multiple versions of the truth
●
misaligned action across the organization
●
difficulty in prioritizing
●
inability to perform in-depth analysis
●
not knowing where to concentrate efforts
●
inability to measure departmental performance
●
unable to locate important information
BI for Banking Institutions - Objectives
Increase Customer Base

Increase Operational Efficiency

Increase Customer Satisfaction

Customer Behavior Analysis

Adherence to guidelines

Staff Performance Analysis

Increase Profitability
Achieving Objectives
Increase Customer Base
Analysis by
Geographical Area
Industry
 By Category
 By Revenue
 By Profitability

Demography
Achieving Objectives
Increase Operational Efficiency
Productivity Analysis
No of transactions – Target Vs Actual
Inter-departmental delay analysis
Time Spent Vs Profitability Analysis
Increase Customer Satisfaction
Suggest alternate investment plans based on past allocation and
performance
Achieving Objectives
Adherence to Guidelines
Locating Deviations
Tracking money trails
Example
• Loan Performance Analysis by
• geographical area
• demographic segments
• industry type, company turnover, profitability, age of
company
• amount of loan, period of loan, interest rate
• occupation, duration of occupation, designation
• salary range
• educational qualifications, marital status
• loan product features
KPIs for Banking Sector
• Income Perspective
 Non-interest income level
 Fee income level
 Gross profit
 Interest spread

• Investment return Perspective

 Return on capital employed
 Return on operating capital
 Return on Equity

• Cost Perspective
 Cost to assets ratio
 Overhead cost ratio
 Cost to Income
KPIs for Banking Sector
Interest Perspective
 Profit margin
 Operating margin
 Interest margin
Company assets Perspective
 Non-performing assets
 Reserve requirement
 Return on average assets

Risk Perspective
 Value at risk
 Capital adequacy ratio
Monthly Account Snapshot Fact
Dealing With Multivalve Dimension
Some touch points
Identification and Retention of most valued accounts
Accounts can be differentiated based on primary
balances and analyzed on that criteria
Understanding ever dynamic customer behavior based
on different parameters
It may be relevant for the bank to capture and store
behavior scores relating to the activity or
characteristics of each account and household
Snapshot of historical monthly data may be used for
defining future products
Insurance Sector
Core Processes:-
Issue/Renew Policies
Collect Premium Payments
Process Claims
KPIs for Insurance Sector
Policy Transaction Fact
 Number of Policy Sale
 Value of policies sold
 Number of policies renewed compared to number of policies sold
 Number of policies sold as compared to quota
KPIs for Insurance Sector
Policy Premium Snapshot Fact
 Number of missed premiums or lapses compared to total number of
policies sold
 Percentage of policies that lapse within the first two years
KPIs for Insurance Sector
Claims Transaction Fact
 Total benefits paid as a percentage of premium
 Frequency of claims
 Time taken to process a claim
Thank You