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Editor's note: this piece originally appeared in the May edition of DS News.
As CTO of SunTrust’s consumer banking arm, Ken Meyer is responsible for many aspects of Enterprise Information Services (EIS), the organizational unit that provides the company’s overall technology and information-related support. Most recently, he was the head of wholesale lending operations at SunTrust where he was responsible for the middle office that supports small business banking as well as commercial and business banking and private wealth management. Meyer joined SunTrust in 2013 from Accenture where he worked with leading financial institutions including SunTrust. He recently spoke to DS News about how technology is changing the servicing side of the business and why providing a complete digital experience to consumers will be more important than ever for lenders.
Which technologies are defining the mortgage and servicing industry this year?
This year is less about one technology and more about continuously changing it based on client expectations and experience. Lenders who use technology successfully will be the ones who can leverage it to reduce the stress of buying a home and really educating borrowers about the process while being transparent throughout their mortgage experience. People don't understand the rules and regulation when it comes to originating a loan. They just want to buy a home and their expectations are changing with different experiences especially with online retail giants like Amazon.
The question is how do we try to reduce the friction in a safe way and educate homebuyers along the way and communicate transparently? Digital engagement is the way of the future. It doesn't just start and stop where technology can help with origination. We should be looking at automation and different technologies in the future and at things like artificial intelligence and machine-learning as well as other ways to leverage data to better and quicker decisions for our clients.
That way, we can reduce the ultimate cycle turn and really equip our teammates from an underwriting and servicing perspective in a way that they have more information and more data than they ever had before. Fewer clients want to call or go see somebody for their borrowing needs. While those channels still exist and will continue to be there, clients are becoming more comfortable with the idea of leveraging technology and digital channels. Lenders must make sure they’re meeting clients where they want, when they want, and how they want.
SunTrust and BB&T announced a merger of the two banks. What will be the impact of this deal on the digital lending platforms of both the banks, especially in the mortgage space?
The news about our merger was exciting for SunTrust and BB&T. It looks like a great opportunity for two purpose-driven companies to come together and bring even more value to both of our clients. Though it is still early days to comment on how we plan to leverage our digital platforms, we look forward to sharing more as soon as we can.
Speaking about SunTrust specifically, our digital mortgage journey has been all about how we get to the point where we put as many tools in the hands of our clients to self-serve seamlessly. We’ve been improving the servicing as well as origination aspect of mortgages through digital initiatives.
From the servicing perspective, we've been on the same journey as many other financial institutions, especially those that have a mortgage presence. In many institutions, you would have separate logins, separate portals, and separate experiences when it comes to post-closings and the different mortgage servicing aspects. We've continued to work on integration into our online channels and mobile channels over the past few years to get to to the point where clients can easily manage their own mortgage alerts and schedule their payments. Through online banking, we've focused on things like how we leverage digital capabilities to engage our clients with things like escrows, settlement, and mortgage statements.
From the origination perspective, we launched SmartGUIDE nationally in March 2018, as a digital platform for clients to engage with us at the point of sale and as a tool for our loan officers to help them guide clients through what is an extremely stressful period of their life—the actual process of buying a home. To date, we've had over 13,000 applications submitted via this platform, and we’ve seen a 25 percent rise in the use of this application since October, which goes to show the strong digital adoption by homebuyers.
What are some of the trends that will define lending in the second quarter of the year?
The mortgage industry continues to be ever changing. We've seen volume in the refinance area decreasing while the focus has increased on the purchase origination side of the house. However, the biggest trend that’s emerging is the increasing willingness of borrowers to engage with lenders in a digital fashion. Lenders, this year, would do well to focus on digital engagement platforms for their clients. For example, within a year of rolling out our digital platform, 75 percent of our applications come through the digital channel. Lenders must create a best-in-class experience that, regardless of what their clients are interested in and whatever they ask for can be leveraged digitally because it is easy to use and educates them along the way.
What does a typical day look like for your team?
As a team that works across various bank operations and businesses, we want to make sure that the foundation for all our digital initiatives remains strong. As a result, my team is always focused on continuous improvement and making sure that we offer a safe, secure, stable, and reliable experience to our clients. Based on client and teammate feedback, we try putting the best technology stack in front of them to ensure a great experience. Our teams are heavily integrated with our business partners and we’re taking on more of an agile mindset with how we develop software and run the different applications. We’re constantly trying to disrupt ourselves, so a lot of discussion is around how do we ultimately leapfrog into the future and make sure that we're not only thinking about our clients’ needs for today but also for the future.
