The Orchestra of Rates Management

Conducting Efficiency with EPM

In the world of commercial banking, rates management is like conducting an orchestra. Each instrument—interest rates, payout schedules, adjustment factors, and lag strategies—must be finely tuned and coordinated to create harmony within the operation. When managed well, the result is a symphony of efficiency, profitability, and customer satisfaction. When managed poorly, the outcome is disjointed, costly, and out of tune with market realities and customer expectations.

Recent statistics show that approximately 60% of banks continue to rely heavily on manual processes, contributing to a 25% higher error rate in rate adjustments compared to automated processes.

A Symphony Without a Conductor

Many financial institutions still rely on fragmented, spreadsheet driven manual processes for adjusting rates. Imagine an orchestra where each musician plays independently—some ahead of the beat, some behind, and no one listening to the conductor. The result is a cacophony of errors, missed opportunities, and revenue leakage.

Banks that manage rates manually often experience:

• Delayed reactions to market movements
• Operational inefficiencies and high cost due to excessive manual intervention
• Revenue loss from misaligned payout strategies on both upward and downward movement of base rates
• Regulatory risks from inconsistent rate applications

• Missed revenue opportunities (estimated at a 10-15% revenue leakage annually)
• Delays in response to market changes, affecting competitiveness
• Increased regulatory fines (recently averaging $5 million annually per institution

Enter EPM-The Maestro of Automation

Enterprise Pricing Modernization (EPM) from ArcOne steps in as the conductor, ensuring every rate adjustment, every adjustment factor and every payout schedule plays in perfect harmony. By automating and centralizing rate management, EPM transforms a chaotic, manual process into a seamless performance.

With EPM, banks can:

• Move away from complex spreadsheets and automatically adjust, amend and execute rate pricing strategies depending upon base rate change
• Increase Revenue with correct spreads and pay outs scheduled at the correct time for the Pricing Strategy without error
• Implement lag strategies to smooth out fluctuations and manage market volatility
• Optimize payout schedules to balance customer incentives with bank profitability
• Help ensure adherence to regulatory requirements, reducing the risk of manual errors and incorrect rate price adjustments
• Following a rate change understand immediately the liquidity position across your whole deposit book

Using EPM technology can provide

• Up to 30% increase in operational efficiency
• Revenue gains averaging 8-12% through optimized payout and spread management
• Enhanced regulatory compliance, reducing fines by over 70%

Precision Tuning: Rate Adjustment Factors & Lag Strategies

Just as musicians finely tune pitch and rhythm, EPM enables precise tuning of rates based on market indices, customer segments, and risk profiles. Lag strategies implemented via EPM reduce customer churn by approximately 15% during market volatility.

The 90-Day Implementation Plan: From Chaos to Concert

EPM's structured implementation roadmap ensures minimal disruption and maximum results within just 90 days:

The Grand Finale: A Competitive Edge in Banking

Top banks differentiate through precise, transparent, and responsive rate management. With EPM, banks enhance customer loyalty and profitability, becoming market leaders in pricing excellence.

Current market trends indicate that banks adopting automated solutions like EPM are outperforming peers by as much as 20% in customer retention and profitability.

Embrace EPM and transform your rates management from operational chaos into a competitive advantage. The baton is in your hands.