Bendigo’s Tiimely and Up Implement Extensive Machine Learning for Home Lending

Bendigo and Adelaide Bank is significantly ramping up its use of artificial intelligence (AI) as part of a broad digital transformation strategy, which spans multiple facets of its operations, from compliance and financial crime management to enhancing customer experiences and streamlining home lending processes.

Outgoing CEO Marnie Baker highlighted AI as a “key pillar” in the bank’s strategy, particularly for meeting stringent compliance and financial crime obligations. AI technologies are being employed extensively to refine processes, such as assessing loan applications and recommending the “next best product” for customers. This is evident in platforms like Tiimely and the digital bank Up, which utilize machine learning algorithms to accelerate home loan applications, thus improving efficiency and customer satisfaction.

The bank’s transformation initiative, which commenced five years ago, has prominently featured a shift to cloud computing. This migration involved moving its digital banking system, app, and web platform to Google Cloud. Baker pointed out that this transition has significantly bolstered the bank’s operational resilience. For instance, during a recent global IT outage linked to CrowdStrike’s endpoint security service, the bank’s cloud-based infrastructure enabled rapid recovery, demonstrating the advantages of cloud technology in maintaining continuity and stability.

The shift to the cloud has also facilitated a more streamlined technology stack, reducing the complexity of the bank’s IT applications. Since FY19, Bendigo and Adelaide Bank has halved the number of its applications from 650 to 324, underscoring the success of its consolidation efforts.

A critical element of the bank’s modernization strategy is the integration of Adelaide Bank and Rural Bank onto Bendigo’s core banking system. This system, known as the ‘Retail Financial System,’ is a proprietary platform that, despite being established around 35 years ago, has been adapted to current technological standards. The system now operates primarily as a core transaction engine, interfacing with updated components through APIs, thus blending legacy strengths with contemporary technology.

The bank’s digital evolution is also reflected in its customer and financial metrics. The digital bank Up has expanded its customer base to 920,000, marking a 29 percent increase year-on-year. Additionally, digital mortgages now represent 19.3 percent of the bank’s settlements, illustrating the growing impact of its digital initiatives. Financially, Bendigo and Adelaide Bank closed the year with a net profit after tax of $545 million, which is a 9.7 percent increase from the previous fiscal year. This growth highlights the effectiveness of the bank’s transformation strategy in driving both operational efficiencies and financial success.

In summary, Bendigo and Adelaide Bank’s strategic emphasis on artificial intelligence (AI), cloud migration, and core banking system integration underscores a robust approach to digital transformation. By leveraging AI technologies across various business functions, from compliance and financial crime management to streamlining loan applications and personalizing customer product recommendations, the bank is improving operational efficiency and enhancing service delivery. The extensive cloud migration, including the shift of digital banking systems and applications to Google Cloud, has not only bolstered the bank’s resilience during global IT outages but also streamlined its technology stack. This transition supports faster and more efficient product delivery, contributing to a more agile and responsive organization.

Additionally, the ongoing consolidation of Adelaide Bank and Rural Bank onto Bendigo Bank’s core banking system reflects a strategic effort to modernize and integrate legacy systems with new technologies. The use of APIs and updated tech for core operations underscores the bank’s commitment to maintaining a competitive edge in a rapidly changing financial landscape. Overall, these initiatives are positioning Bendigo and Adelaide Bank for continued growth and adaptability, ensuring they remain competitive in the dynamic financial services sector while meeting evolving customer needs and expectations.