How Hampshire Trust Bank is using digital transformation to improve human interaction, not replace it

How Hampshire Trust Bank is using digital transformation to improve human interaction, not replace it

Hampshire Trust Bank (HTB) is a specialist bank staffed by experts focused on helping UK businesses realise their ambitions. The bank’s primary operations are development finance and specialist mortgages, and specialist business finance, focusing on wholesale, block-discounting, classic cars and other asset finance categories. HTB also provides award-winning savings accounts to individuals and businesses. Russ Fitzgerald, Chief Information Officer at HTB, discusses the digital evolution of the bank: “Although the bank was initially established back in the 1970s in Hampshire it was acquired by private equity investors in 2014. Soon after it moved to London and has been successfully growing its business since, moving to its current Bishopsgate headquarters in 2017”.

Fitzgerald joined HTB in April last year as an IT Director and soon progressed to CIO in September the following year. “I was introduced to HTB having spent the last 20 years or so working for large financial institutions. After I left my previous role I felt less attracted to the larger institutions and wanted to work for a smaller bank where I could play a greater part in defining and delivering the strategy,” he says. “HTB has turned out to be everything that I'd hoped for.” The CIO’s role involves managing IT, security, business transformation, facilities, operational resilience and supplier management.

With an impressive growth trajectory in terms of staff and revenue, the bank targeted digital as the key to its expansion. “In line with our growth and to support this development, the next stage of our transformation relied heavily on technology. This initiative launched our digital transformation journey,” says Fitzgerald. “Fortunately, the bank was built on robust foundations – this is a credit to those who established the business in 2014. It runs on a core banking platform called Phoebus, which provides all the services the bank has needed to date. The team at Phoebus also provide a first-rate service, delivering dynamic support for smaller banks. They’re less rigid than mainstream suppliers, which works particularly well for us and suits our agile operating style.”

When Fitzgerald joined HTB, he established a strategy for the board and prioritised plans for technology and infrastructure development. The bank introduced an application programming interface (API) infrastructure as part of its high-level architecture, which enables data services and collaboration capabilities. This infrastructure involves consuming data services to improve operational efficiency, credit risk processes, and customer and broker experience. With this infrastructure in place, the bank can maximise the potential for Fintech collaboration opportunities.

“Integral to our strategy was the introduction low-code tools into HTB. Having assessed the marketplace, we forged a strategic partnership with MatsSoft (Netcall) to use their low-code environment to develop workflow and front-end integration with data and services, such as Phoebus which can help improve operational efficiency and underwriting capabilities” he adds. HTB found that MatsSoft (Netcall) enabled it to build development capabilities with ease and speed, due to its ability to offer API integration. With low-code, the firm has commissioned a series of developments within its operations, such as a new mortgage platform. “The bespoke platform targets specialist lending. It will be integrated through API infrastructure with Phoebus later on this year and will give us much needed operational efficiencies through data collection with both internal and external data sources. Opportunities to collaborate with Fintechs within the property market remains an opportunity waiting to be tapped” says Fitzgerald.

The bank has also formed a valuable partnership with consultancy firm Virtrium, a Chaucer Group Company. “Virtrium helped us identify, procure, contract and assess the architectural implications of various API orchestration layers,” notes Fitzgerald. “In September 2018 we commissioned this transformation work with Virtrium, and by December we had settled on a contract with SnapLogic. By the end of the month, we had implemented the API infrastructure into our production environment and had a proof of concept up and running.” Throughout the year ahead, HTB will invest in its existing applications and develop further platforms focused on improving operational efficiency, underwriting capability and broker experience.

During last year, the firm developed a series of core applications which HTB plans to integrate with back-end platforms using Snaplogic’s API infrastructure. The applications have been created in order to improve efficiency as well as broker and customer experience. “We’ll use them to underpin the specialist advice that we give on a face-to-face basis to brokers and their clients. HTB has also invested in the Sprint platform from Apak Group, a Sopra Banking Software company. “Our partnership with Apak has worked well for us,” comments Fitzgerald. “Our collaborative development of their Sprint platform services the brokers of our Specialist Business Finance Division. We’ve had some amazing broker feedback on the platform,” says Fitzgerald. “It is now integrated to HTB via our API infrastructure and will shortly integrate Sprint with APIs for Asset valuations and HPI checks, further improving efficiency with more opportunities on the horizon.”

On the subject of capability, Fitzgerald notes: “While we have the ambitions to build the services and capabilities of larger competitors, we sometimes lack the senior capabilities to help lead us through the journey. I draw down on ‘Capability as a service’ to supplement our strength. We have a great relationship with Ben de la Salle from ICA Consultancy, as he gives us the capabilities of a big bank CISO when I need to set strategy and direction, as does Cliff Ratcliffe from Techana who brings the IT architectural knowledge and lessons learnt from bigger banks to the benefit of HTB. Cliff has proven to be a valuable partner for us and I have the benefit of them on site on a part time basis as and when we need them.”

HTB recently refined their credit risk strategy with help from partner Deloitte. As a result of this, the bank is investing in modelling, decisioning and data analytics capabilities. “Deloitte were key for us in helping set our strategy and stretch our ambitions,” comments Fitzgerald. “With Deloitte’s guidance and support we have invested in a complete refresh of our data and BI technology stack, which resulted in a decision to invest in Snowflake’s database architecture and the Tableau visualization tool.”

“We’re not on a digital journey to replace human interaction – this is a digital journey that enhances human interaction and allows us to drive up our proposition, improve our operating efficiency and draw information from internal and external data sources that will greatly improve the way in which we underwrite and assess propositions,” says Fitzgerald.

“We have established our high-level architecture and identified, contracted and purchased our API infrastructure,” Fitzgerald concludes. “Our API Infrastructure enables HTB to play a greater role in the SME lending ecosystem. We have further commissioned low code development tools to develop our capabilities in this space and worked closely with flexible platform providers to tailor our proposition. We will further utilise data and services with a view to benefiting from open banking opportunities in the short term. Our detailed infrastructure strategy underpins this and demonstrates how we manage capacity and compute capabilities across a hybrid of our own data centers and the public cloud. This allows us to be an agnostic provider in our approach to transitioning capacity and compute to the cloud, which is aligned with our agile delivery approach” states Fitzgerald.

As the company continues on its digital transformation journey, it is focussed on using data services to improve operational efficiency, underwriting ability, and the customer and broker experience. “Collaboration with Fintech’s is a key component of my role and keeping a close eye on where Open Banking is going is essential for HTB as an organisation,” notes Fitzgerald.

Russ Fitzgerald