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ZM Financial Systems: Demystifying Financial Data

CIO VendorButch Miner, Co-Founder
It was a landmark day for a major depository institution. In their quest to purchase loans and announce their presence at a certain geographical location, they had successfully modified the terms and conditions of the loan-sellers and purchased loans on a favorable basis. A much better picture than when they started this initiative, it was their collaboration with ZM Financial Systems that assisted them to derive a positive operation. “When the institution partnered with us, we were able to analyze the loan terms through our portfolio analytics system and came to a conclusion that the loans they had shortlisted were not giving feasible returns,” mentions Butch Miner, the co-founder of ZM Financial Systems (ZMFS). Through ZMFS’ loan analytics included in its portfolio analytics system, the depository institution was able to uncover the extra value from the purchase.

Over the years, ZM Financial Systems has become the go-to-partner for more than 2,000 such depository institutions, and for the broker-dealer community, through its single, integrated system for all of their pricing, valuation, stress-testing, and earnings simulation needs. The reason? Not only does the firm’s one-stop portfolio analytics system allow its clients to calculate traditional single instrument and risk measures under a variety of interest rate models and scenarios, it also enables them to assess Monte Carlo VaR using multiple risk factors. Further, it facilitates clients to perform detailed total return analysis with independent settings to allow terminal valuations based on market conditions.

We bring comparability and consistency across multiple departments

Earlier, the various departments inside a depository institution, such as the security or investment portfolio, were separated from the full-balance sheet risk management capability and the credit admin function. The financial crisis has changed this scenario. Centered on stress-tests to ensure financial institutions have sufficient capital, there has been a push from regulatory bodies to have a similar type of analysis which requires a convergence of these departments. This has given rise to a need for a single software that can lead to less incurred costs and seamless comparability across all departments. The institutions also need third-party market integration sources to evaluate all the elements and operationalize analytics. As a part of their investments securities analytics, ZMFS pulls different features to allow clients to draft securities terms and conditions seamlessly. Through its various third-party links with Bloomberg, Reuters, and Moody’s, ZM Financial Systems is able to bring the terms and conditions to the system and then run securities on a single set of assumptions. “Further, we also provide different analytics features such as earning and income simulations to define the process that will be implemented for the clients, and a calculation engine API that provides the users with ultimate flexibility as they are able to program the interface of the system to reveal and report the features that they want,” adds Miner.

ZM Financial Systems puts particular emphasis on maintaining a comprehensive client relationship by being involved in frequent peer exchanges with credit unions and clients. Miner mentions talks about the 15th year conference the company will be hosting in the fall of 2018. ZMFS also has an active enhancement forum where the clients can discuss about the features that they want them to add to the system. Moving ahead, ZM Financial Systems will be focusing on the cloud-based offerings that will allow the clients to install the system rapidly. They will also assist clients in analyzing the institutions’ history, build tuned behavioral models and prepare reports geared toward the owned securities and underwriting standards.