Net Interest Margin Planning Case Study - Banking

Olympia Federal Savings Better Manages Interest Rate Risk With 50% Faster Budgets and On-Demand NIM Forecasts in Vena
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Snapshot: Olympia Federal Savings (OlyFed)

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A community bank based in Olympia, WA
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The firm has 8 branch locations and nearly $800 million in assets
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Integrations: Prologue Financials (Fiserv) for GL/ALM, Paylocity for HR
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“It used to take me hours to update the budget and reforecast net interest margin, but now I can do it in just a few minutes.”
Kristina Ware
VP Controller, Olympia Federal Savings
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OlyFed Before Vena

“I don’t even want to think about how long all the budgeting tasks used to take me.”

That’s how Kristina Ware, VP Controller at Olympia Federal Savings, remembers her life at work prior to implementing Vena. In those days, Kristina was solely responsible for aggregating all of OlyFed’s budget inputs using nothing but offline spreadsheets. The process just wasn’t sustainable—even for a relatively small community bank—because with no quick way to compare interest-earning assets and liabilities at the product level, Kristina couldn’t reforecast net interest margin on demand or provide a real-time measure of OlyFed’s profitability. 

“We had a workbook for lending, a workbook for branches and another one for all our support areas. I’d have to enter data for everybody,” she says. “Broken links were a challenge. Getting the budget together was an extremely time-consuming process.”  

For context, nearly all of the three-month budgeting cycle was spent consolidating data manually. Basic financial statements took at least two hours to produce, while updating net interest margin forecasts with new rate assumptions took even longer. As a result, Kristina didn’t have time to bolster reports with in-depth analysis—making it tough to paint a clear picture of how the bank was actually performing.

“We couldn’t do a lot of quick and robust analysis before Vena. That was a big problem because you need to be able to reforecast and update your budget at any time,” she says. “Just think about March 2020, which was right before we started with Vena. Interest rates dropped by 200 basis points. A 5% mortgage versus a 3% one is huge for us. If we could have reforecasted for those changes as they happened, it would have made a big difference in our strategic planning and decision making, which ultimately would have helped enhance our performance at the end of the year.”

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The Vena Solution

OlyFed went live with Vena for Banks and Credit Unions—a pre-configured solution designed specifically for net interest margin planning—in January 2021 at the start of their FY22 planning cycle. Kristina was instantly impressed by the new net interest margin template, which gave her a holistic view of OlyFed’s assets, liabilities, rate assumptions and total earnings. Actuals load in automatically via integration with Prologue Financials and Vena’s pre-built planning logic sorts them by product and specific branch. Kristina says “it’s been a lifesaver” for her and for all of her teammates because they don’t have to struggle with spreadsheets to find the granular data they need.

“The nice thing with Vena is the ability to drop in new rates and reforecast whenever I want to, without having to do the entire budget all over again,” she says. “Everything just rolls up in the Vena database—and we can even adjust our growth numbers from that same template as well. It used to take me hours to update the budget and reforecast net interest margin, but now I can do it in just a few minutes.”

Another key success factor was Vena’s Excel interface, which made the platform easier to roll out to the bank's other departments. Today, instead of relying on Kristina to update the budget with new headcount information, OlyFed’s HR team leverages Vena’s workforce planning template to ensure employee salary expenses are accurate for every month. 

“I knew Vena would be better for our users in other departments because they wouldn’t have to learn an entirely unfamiliar solution. It was a lot easier to teach them something that was already based in Excel,” says Kristina. “Our HR team, for example, is running new headcount numbers regularly. Now that we have a dedicated HR cube in Vena, the team can just upload an Excel file from our payroll software right into the database. It’s a much more accurate way of budgeting because we can truly budget by the month instead of allocating new salary expenses across the entire year.”

OlyFed With Vena

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Budget consolidation times are 50% faster
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Net interest margin forecasts are available on demand and only take a few minutes to generate
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Monthly financial statements take 30 minutes instead of 2 hours and are ready for distribution just 2 days after month-end close
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Key Results

Now that OlyFed’s budget data is aggregated automatically in Vena, Kristina has more time on her hands for strategic, data-driven analysis. She says it’s given her the ability to look ahead more confidently and help OlyFed’s leaders chart the best path forward for the business.

“If this COVID year has taught us anything, it’s that anything can happen six months down the road. But now, if something drastic happens, we feel more prepared to adapt and change with the tools and information we need,” says Kristina. “One thing the regulators always want us to look at is how we’re reforecasting and how we’re managing our interest rate risk. With Vena, we can just look at our template quickly and say, ‘Okay, if rates go up or down, this is the impact it will have and this is what we’re going to do.’ We have more time to make decisions and really review them ahead of our board meetings.”

Budget consolidation times are 50% faster, monthly financial statements take 30 minutes instead of two hours while detailed workflows and audit trails ensure the numbers are always accurate. Kristina says it’s helped her evolve into a strategic partner to the business—while also laying the foundation for even more growth with Vena in the future. 

“The time savings alone have really made Vena worth it for us. End-to-end budget consolidations take at least half the time now and there’s a lot less room for human error as well,” she says. “Now that I have more time to focus on the bank’s strategic objectives, I’m working on new cost center reports that I can distribute to different department heads. For me, that flexibility is the real benefit of having a solution that’s so easy to use.”  

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