bankingciooutlook

ZM Financial Systems: ZMdesk for Sophisticated Balance Sheet Management

CIO VendorButch Miner, CPA, CFA, and Co-Founder
Modern day banking institutions are at the crossroads of managing the key areas related to regulations and business profitability. Maintaining a strong interest margin in the current economic scenario is difficult and also clients need to understand every basic point of risk and reward decisions. Further, the regulatory burdens for various financial institutions have exploded over the past few years, resulting in a resource drain. At the very forefront of addressing these challenges and staying on top of relevant regulations is ZM Financial Systems (ZMFS). The solutions from ZMFS are designed to fit efficiently into the existing infrastructure of financial institutions. Striving to eliminate redundancy, ZMFS works with clients to understand and address multiple needs with a single set of data and assumptions. “We continuously work to evolve our products with enhancements that are either client-driven through specific requests or industry-driven to meet new requirements,” states Butch Miner, CPA, CFA and Co-Founder, ZM Financial Systems.

The company’s flagship product, ZMdesk is designed to meet sophisticated balance sheet management requirements. “Balance sheet instruments are loaded individually with their unique behaviors, allowing the ZMFS models to generate precision analytics for almost any need,” says Miner. Also, the outputs from ZMFS are used to corroborate pricing on deals being presented by brokers in order to facilitate decision making for tasks such as selling a loan portfolio. Many clients use ZMFS to understand their risk profile and then shift the risk composition, by adjusting product offerings to incent consumers towards shorter or longer-term business, depending on the desired outcome.

Additionally, ZMFS’ range of analytical tools includes OnlineALM.com and OnlineBondSwap.com. These applications deliver specific features of ZMdesk through a hosted environment. OnlineALM.com is a cloud-based asset-liability management solution created for community institutions to inform them of the risk and reward tradeoff to balance sheet strategy selection. “This offering combines together the latest technologies in financial modeling and web programming in order to deliver accurate results on a stable platform of board compliance and strategic risk planning,” says Miner. The tool also has certain benefits related to its installation, maintenance, and up-grades.

Balance sheet instruments are loaded individually with their unique behaviors, allowing the ZMFS models to generate precision analytics for almost any need


It allows users to easily log in, upload their mapped data, set up simulation assumptions and process. OnlineALM.com also gives users the option to download relevant reports and outputs in Excel and PDF formats. Additionally, ZMFS offers a complimentary budgeting solution that utilizes cash flows derived in the ALCO process as the foundation for budgeting. ZM Budgeting is a completely web-based budgeting solution designed to ease the process of gathering, accumulating, refining, and finalizing financial institutions’ budgets. The tool’s duel-entry accounting keeps everything in balance and linked planning capabilities allow clients to automate relationships for specialized accounts.

Hundreds of financial institutions have deployed ZMFS’ solutions and gained analytical rigor needed to tackle securities portfolios as well as full balance sheet risk management. For instance, the company worked with United Nations Federal Credit Union (UNFCU) to determine risk involved when analyzing a loan portfolio. Based on ZMdesk’s capability and ease of use, UNFCU quickly analyzed and stress tested the loan portfolio, including credit and liquidity risk. The organization was able to evaluate several scenarios to assess the risk and estimate a final price. “UNFCU plans to continue using ZMdesk to analyze potential loan portfolio purchases and to strengthen its analytics and asset/liability management,” states Miner.

ZM Financial Systems is dedicated to staying ahead of the evolving federal regulations for banking institutions. Moving forward, the premier company is anticipating the launch of funding ratio enhancements in order to provide its clients with a comprehensive, regulatory-integrated system in a complete package. “With a focus on enterprise-wide risks and cloud-capable offerings, we plan to improve ZMdesk, in terms of scalability and efficiency by enhancing database calculation functionality for larger bank data sets,” states Miner.