Bank information systems are classified as “hybrid” systems. They include basic accounting operations, decision support software and offline banking products such as insurance and financial planning software. Systems are implemented on intra-office networks to serve their customers. Bank accounting systems are under state and federal regulatory agencies to ensure they are accurate and reliable.
General Ledger Systems
The general ledger is at the core of account processing and information systems in banking. The general ledger is the record accessed to perform account transactions. It records every transaction, which interfaces with a designation of accounts. A bank general ledger can be slightly different from modern industry general ledgers because of certain compliance rules set forth by the Federal Reserve Bank (FRB) and the Federal Deposit Insurance Corporation (FDIC). Banking general ledger systems operate on mid-range software which can be turnkey or out-of-the-box software customized for banking industry applications.
Loan Accounting Applications
Banks make the majority of their money through loans and investments. Through loan accounting software, bank personnel can process the forms and paperwork needed to make a decision on a customer’s credit standing. Managers can then access data to examine the bank loan portfolio, generate compliance checks for auditors and track loan-loss reserve accounts. Loan origination software can interface with an accounting information system through most PC-based systems.
Mortgage Banking Applications
For banks in the mortgage industry, mortgage bank application modules create and maintain information according to mortgage loans provided by banks to its customers. The mortgage information system generates customer statements, tax statements for federal and state tax offices, and creates an escrow account for mortgages on the bank's portfolio. In the general ledger, mortgage bank accounts consist of several sub-accounts such as taxes, the actual value of the mortgage, assessed value of the mortgage and other variables.
Customer Account Applications
Customer account applications provide unique primary key identifiers to link customer information to an account number assigned by the information system. The customer account is maintained on the system and referenced by the account number in the general ledger. The customer account number is the link for customers to interact with online and offline banking system applications. Customer account information is also the basis for transaction exception reporting for various customer account issues.
Internet Banking Applications
The latest evolution in banking information systems are web-based applications that support internet banking. Internet banking programs interface with accounting information systems through a portal with a "point-of-access" website. Through secure web servers, customers can perform actions which can update or change general ledger status. Management analyzes reports pertaining to internet banking such as how many customers are using the internet for deposits and transfers or to access other banking products. Internet banking applications are also used for the online marketing of bank products through marketing software created for banking institutions.