Delivering more personalized banking with a modernized data infrastructure

To the people behind these successes, Capital Bank’s growing momentum amounts to a validation of pro-growth market strategies and, perhaps just as much, to the value of being technologically prepared to execute those strategies. As with nearly all organizations in 2020, Capital Bank’s top executives were focusing much of their resources on trying to understand and adapt to the challenges brought on by the pandemic. At the same time, however, they were putting considerable thought into the bank’s long-term growth prospects, and how to improve them.

Up until that time, Capital Bank had been a solid regional player focused primarily on serving the large enterprise market and, more recently, small and medium-sized businesses. To the bank’s top decision-makers, the retail banking market—in Jordan and the surrounding region—represented a huge untapped opportunity, especially on the digital side. Of Jordan’s 10 million citizens, for instance, some 80% were mobile phone users, essentially putting most of them in the addressable market for digital banking services. In contrast, just over one quarter of the country’s female population, and roughly one half of its males, actually had a bank account. In that yawning gap, Capital Bank recognized the opportunity to expand its retail business, thereby increasing its revenue base.

It saw two key paths. In addition to creating a digital bank—called Blink—Capital Bank also looked at strategic acquisitions of other banks as a way to increase its retail and corporate banking footprint. Both held the potential of adding new retail and corporate customers, to whom Capital Bank could provide a wide range of services. But the bank’s senior management—people like Group Chief Operating Officer (COO) Izzidin Abusalameh—also knew that the full realization of this vision required Capital Bank to get the execution right. “For us, execution means integrating our acquisitions rapidly and smoothly, and beyond that, delivering a high-quality, personalized experience for all of our customers,” he says. “We see unified data management as the foundation of those capabilities.”

Why data management? Ultimately, explains Abusalameh, it comes down to knowing the customer. “At its core, our retail and corporate strategies are based on gaining a deep understanding of our customers, and using that knowledge to cultivate and strengthen our relationships with them,” he says. “In that sense, having the right data infrastructure—to collect, organize and analyze our data—is fundamental to the success of our strategy.”

By early 2021, Capital Bank had defined its technology need—“a modernized data hub environment that will enable the next level of advanced data analytics” such as AI and machine learning (ML)—and was looking actively at options. While the bank had substantial legacy solutions in place, the success of its nearly 20-year relationship with IBM, and the trust and experience it had accrued, put IBM solidly in the running. Another major factor that kept the bank open to IBM was Abusalameh’s positive experience with the IBM® Netezza® Performance Server solution during a previous stint with another bank. After a series of intensive deep-dive sessions and demonstrations involving the IBM technical sales team, Capital Bank executives and in-house specialists, the bank’s decision team concluded that the IBM Cloud Pak® for Data platform, along with the Netezza Performance Server as the primary data warehouse, fit the bill best.

Asked about the key “pro” of the IBM solution, Bahaa’ Awartany, the bank’s Chief Data Officer (CDO), points to the breadth of built-in, integrated capabilities of the IBM solution that he sees as unique. “Having a solution that can support every dimension of our vision—data, AI and machine learning—is very important,” he says. “IBM brings the advantage of a very powerful data warehouse along with a full suite of AI and machine learning tools. It’s what truly set the IBM solution apart.”

The implementation of the solution, performed by IBM Business Partner Jordan Business Systems (JBS) with offsite support from the IBM team, is proceeding in two distinct phases. In the first, now complete, JBS deployed the Netezza Performance Server units allowing Capital Bank Data Office to build the data warehouse. Once it was completed, Capital Bank Data Office captured and centralized data from its core banking and 15+ banking applications into the warehouse.

The other key milestones of this implementation stage were the integration of two recently acquired banks, Bank Audi (in Jordan and Iraq), and Société Générale Bank Jordan. In both cases, JBS supported in migrating not only core banking data, but also HR, payroll and other enterprise application data. At that point—roughly the middle of 2022—Capital Bank had unified all of its critical data into a single source of truth. The foundation had been laid, and the data science and analytics phase had begun.

Now well underway, Capital Bank—led by its own developers and data scientists—is using advanced AI features included with the IBM Cloud Pak for Data solution to build an infrastructure for predictive decision-making. The most prominent use cases thus far relate to predicting customer behavior patterns based on large volumes of historical data, principally drawn from the bank’s now-unified Data Warehouse system. For instance, using the IBM Watson® Machine Learning tool, a capability in IBM Watson Studio on IBM Cloud Pak for Data, the bank’s data scientists are analyzing the correlations between customer demographic and behavior parameters and demand for banking products.

As CDO Awartany explains, identifying customers with the highest propensity scores—which translate into higher product demand scores—enables Capital Bank’s marketers to target specific cross-selling offers more effectively, thereby increasing conversion rates and, ultimately, revenue per customer. “As we continue to expand our retail side, the insights we gain through ML and AI provide a huge advantage in predicting the needs of our customers and thereby serving them better,” Awartany says. “We’re equally excited about applying this predictive approach to customer lifecycle management, to be able to offer our customers hyper-personalized products and services across all stages of their journey. We can also flag customers at risk of churning and approach them proactively to address the underlying issue.”

In the same way it can detect churn risk, he continues, Capital Bank’s ability to analyze customer behavior patterns with AI also has clear relevance for a range of other operational risks. “By mashing up all our data into a single source of truth, our unified data platform gives us a holistic view across all of our customers and their transactions,” Awartany explains. “By building and training AI models to look for suspicious transaction patterns, the platform becomes a particularly powerful tool for detecting and preventing financial fraud, money laundering and terrorist financing cases.

As Capital Bank continues to build out its AI and data science capabilities, its core data warehouse is already compiling a solid record of operation benefits. In the view of COO Abusalameh, the solution’s standout performance came during the ultimate crunch weekend, when all the data from one of its recently acquired banks needed to be migrated to its own core systems in time to get the acquired bank’s branches up and running on Sunday morning. “Without the Netezza platform, our experience showed that we could have expected to spend the better part of a week on the migration,” he explains. “Allowing for data quality check, we were able to achieve this critical changeover—representing millions of records—in about four hours.”

The operational benefits of the Netezza solution were also apparent in the recent rollout of the bank’s new mobile app, the centerpiece of its push into the retail market. As CDO Awartany elates, the solution’s ability to provide actionable dashboard insights on the customer experience gave the bank’s IT team the means to take quick action when the customer’s mobile experience went awry. “With our dashboards, we were able to pinpoint blocking points—such as log-in issues and other problems in the experience—in minutes, 10 or 15 times faster than we could have without them,” says Awartany. “By helping to deliver a smoother experience, our new data stack played a big part in the success of our mobile rollout.”

While a pointed case of data transparency in action, Awartany also sees the mobile example as indicative of a broader shift that aligns well with the bank’s long-term digital vision. “With examples like this—and more parts of the organization taking notice—we’re already seeing the signs of a change in our decision-making culture,” he says. “And with AI entering the mix, we only see that momentum growing stronger.”

Based in Amman, Jordan, Capital Bank (link resides outside of ibm.com) offers commercial and investment banking services and solutions to retail and corporate customers in Jordan, Iraq, UAE and Saudi Arabia. To further expand, Capital Bank acquired Bank Audi’s operations in both Jordan and Iraq in 2021, and in 2022 acquired the branches and operations of Société Générale Bank in Jordan, strengthening its position in the Jordanian and regional banking markets.

Based in Amman, Jordan, JBS (link resides outside of ibm.com) is an IBM Business Partner providing business-focused, integrated IT solutions for organizations of all sizes. JBS’s clients can depend on a partner with flexible scale, a broad solution portfolio, and more than 20 years of business IT insight.