Banking on Curiosity

Technically, Steven Alonso’s background as a mechanical engineer isn’t that unusual for the consumer banking industry. Sure, he used to work for Procter & Gamble where he was responsible for manufacturing Tide detergent, among other tasks, but according to Alonso he was one of many who left the engineering field behind for banking. In the mid ’80s when banks were consolidating, they began building operational centers, and who better to run them than engineers with technical expertise and experience managing people?

After a seven-year run as senior vice president and division general manager of consumer lending operations for Household Finance and Household Bank and a six-year tenure as CEO of the consumer financial services group at Bank One, Alonso had a successful stint as an entrepreneur in financial services before finding his way back to big banking as Fifth Third Bank’s executive vice president and head of the consumer bank. Here, Alonso shares four Fifth Third Bank initiatives that have made an impact.

Streamlining Services

After years of acquiring other banks, Fifth Third Bank had 1,325 retail branches in 12 states—and 25 different checking accounts and 17 savings account options. Alonso and his team felt that the products they offered had to have different value propositions for consumers, but the number of accounts available was excessive. Fifth Third Bank decided to directly appeal to more than 1,000 customers with their Voice of the Customer exercise, asking each for their feedback on the features that were most important to them. After mulling over the results, the bank was able to narrow down their offerings to five checking accounts and three savings account options, with almost half of the bank’s customers already switched over to the new products. By springtime, all of the bank’s customers will be enrolled.

Alonso says completing the new rollout required a “Herculean effort” by many and it was the largest project he and his team had ever undertaken. “We now have concise value products,” Alonso says. “We call ourselves the ‘curious bank’ because we’re curious about our customers’ needs. What do they want their retirement to look like? What are their dreams? What are they saving for? We can’t help unless we’re curious about you—and we are.”

DUO Card

Fifth Third Bank is the only bank that has a card that acts as both a debit and credit card, allowing customers to choose how they’d like to use it for each transaction. When checking out at a store, customers are often asked to choose between debit and credit no matter the card being swiped. Even if credit is chosen, the money will come directly out of their checking account, but that’s not what happens with the DUO Card. The idea was to give consumers more financial flexibility. When choosing “credit,” for example, their purchase goes against their credit line—just like a normal credit card, giving them the option to pay it off at the end of the month or over time.

“It’s a big deal to roll out a new product because there’s the legal component, the risk, the marketing, etc. There are so many moving pieces and you have to rely on customer feedback to calculate whether people are going to love it or hate it,” Alonso says. “It was no different with the DUO Card, but it’s exceeded our expectations. Last year, we sold more than 60,000 and it continues to grow in popularity. We’re thrilled.”

Mortgage Growth

Alonso says that thanks to the government keeping mortgage rates low, many have been able to refinance their homes, which “helps the economy and helps customers.” It’s also proving to be good for Fifth Third Bank. When Alonso joined the bank in 2008, it was doing $900 million a month in mortgages; it’s now doing $2.2 billion a month, taking the bank from the 23^rd largest to the 13^th largest mortgage bank. Clearly, this is significant growth and what benefits the bank also benefits those in need of work. This growth has created hundreds of new jobs in the 12 states that house Fifth Third Banks and as Alonso says, when business grows, jobs grow.

Reemployment Pilot

“No bank wants to foreclose on a home. Anyone who tells you they do isn’t familiar with how the industry works. We want to keep people in their homes and not only that, but it costs us money when we foreclose on a home,” Alonso says. To keep people in their homes and avoid losing money, Fifth Third Bank partnered up with NextJob, a nationwide reemployment services and software company, for a program unlike any other the industry has ever seen: giving unemployed mortgage borrowers job-search assistance, including one-on-one dedicated coaching, weekly webinars, and online job search software, all of which is being fully paid for by Fifth Third Bank.

Originally a pilot program, in 2012 unemployed Fifth Third customers who were in serious risk of defaulting on their mortgages were given the opportunity to participate. On average, many of the participants had been out of work for 22 months and after six months in the program, nearly 40 percent were fully employed.

The program was so successful that in February 2013, Fifth Third Bank signed a multiyear contract with NextJob, permanently incorporating the program into how the bank does business. “This is something that’s never been done before,” Alonso says. “We expect the industry will embrace it. We want to see banks actively trying to find people jobs and not foreclose on their homes. It will just be another aspect of what we do to help customers.”