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Manulife Bank & Manulife One

Canada's first virtual bank.

"I see no limits to our potential success with Manulife One," says Roman Fedchyshyn, President of Manulife Bank of Canada. "Everyone wants financial freedom and flexibility. We’ve seen young couples pay off their property in as little as five years. We’ve seen older couples finance their lifelong dream trip. We’ve seen people in financial difficulty choosing to pay only the interest owed on their accounts. This kind of freedom and flexibility will continue to drive the success of Manulife One."

The Manulife One account was launched by Manulife Bank in 1999 and has helped drive the growth of the bank to over 15 billion dollars in assets making it one of Canada’s fastest growing financial institutions.

How does it work? What makes the Manulife One account so different from the normal banking approach? How can clients save thousands while paying off their mortgage sooner?

The Manulife One account allows clients to combine borrowing, all savings, and available income into a single account. This doesn’t sound revolutionary. But it is. The breakthrough concept to understand is that all available income is available to reduce debt. This is a dramatically different approach than traditional banking where people hold their cash in savings and chequing accounts earning no or low interest.

"Portfolio+ banking software enabled us to design the Manulife One account so that every dollar deposited helps reduce principal," explains Fedchyshyn. "It’s a powerful concept that’s changing the way people think about banking."

Manulife One may be a revolutionary approach for the financing of a property, but clients don’t have to give up the conveniences of regular banking, like the ability to write cheques or access accounts through ATM’s, web banking, or telephone banking. Manulife One account holders can deposit or withdraw money from over 2,300 ATM’s in Canada at no additional charge.

A bold beginning.

Manulife Financial was granted permission by the Canadian government to form a Schedule I bank on January 1, 1993, after it acquired and merged three different trust companies. Manulife Bank then took a bold step. They sold their branch network to become one of the first banks in the world to market their products and services solely through independent financial advisors.

"The decision to rely on financial advisors for referrals was a radical move at the time, but in hindsight it was the right one," says Fedchyshyn. "It meant we would succeed or fail based on quality of our products and services."

Manulife Bank: A new approach.

In January of 1999 Manulife Bank began exploring a new type of banking product, similar to an “all in one” account that was popular in Australia. There was no existing solution in the Canadian banking software market at the time, so Manulife Bank approached Portfolio+ Inc. with the design concept, and after working through multiple prototypes, the Manulife One product was launched in October of 1999. It was the first of its kind in Canada and it remains the definitive "one" account in the Canadian market today.

Manulife One: Challenges.

The biggest challenge Manulife Bank faced in marketing the Manulife One product was its acceptance among independent financial advisors. It’s always difficult to promote change, and these advisors were used to dealing with investment products. They had no familiarity with any kind of credit product, let alone something as new to the industry as the Manulife One account. They were hesitant to leave their comfort zone. Something had to be done.

The first step to improve sales was to pair the financial advisor’s clients with someone from Manulife Bank to guide them through the origination process. This is when Manulife Bank introduced the concept of a “banking consultant”. The banking consultant, a Manulife Bank employee, would guide clients through every step of the origination process, using Portfolio Plus, and answer any questions. This achieved three goals. First, it reduced the amount of time to open an account, which then improved customer satisfaction. Second, it provided clients some real time education as they were guided through every nuance of the process. And third, it gave the financial advisor more confidence in the Manulife One product and its potential to save money for their clients.

Promoting banking products through financial advisors demands the highest level of professionalism. There’s little tolerance for errors or poor service. After all, independent financial advisors invest years building trust with their client base. They want to protect their reputationnot put years of future business in jeopardy.

Manulife One: Speeding up the process.

Another challenge, in the beginning, was the amount of time required to open a new Manulife One account. The account opening process, which took days, was a foreign concept to most clients who were used to much quicker results from their financial advisors. But opening an account that could finance a property required specific due diligence. There were many steps, including credit checks, appraisals, document checking, and more. To make matters more challenging, some of these steps were dependent on third parties.

Delays made the clients nervous which, in turn, made the advisors nervous. Would they qualify? Had they submitted all the forms correctly? The delay needed to be addressed.

Manulife Bank’s development team worked with Portfolio+ Inc.’s development team in a number of joint application development sessions to help come up with a solution. It was hard work, but the result was an outstanding achievement.

Working with Portfolio+ Inc., Manulife Bank embarked on the implementation of an electronic messaging interface to Portfolio Plus that allowed an exchange of data between other Manulife Bank systems, credit bureaus, imaging software, and government agencies. The solution reduced the Manulife One origination process from days to as little as twenty minutes. The solution not only improved a client’s first impression of Manulife Bank, it also gave more confidence to the financial advisor. As an added bonus, the new interface also reduced costs and errors.

Happy customers: Manulife Bank’s best salespeople.

Providing service without branches is challenging. Providing great service without branches is harder still. Manulife Bank has proven it can be done. They’ve come up with a formula that makes the most of both their talented employees and the technology at hand. Technologies like interactive voice response, ATM/POS card access, bill payments, and web banking interfaces help support the efforts of highly trained customer service representatives who ensure Manulife Bank’s standards for excellence are met.

“Although many people consider Manulife Bank a virtual bank, I can assure you there is nothing virtual about the relationship we have with our financial advisors and our customers,” says Fedchyshyn. “It’s still people working with people to achieve a financial goal. We depend on our customers for word of mouth references and we earn that benefit when we deliver results.”

Team building with Portfolio+ Inc.’s Preferred Services Group.

Exceeding expectations for growth and quality service can be a challenge for any institution. With Portfolio+ Inc.’s Preferred Services Group as part of its team, Manulife Bank is succeeding at both.

“Manulife Bank is changing the face of banking with our unique products and delivery channel,” says Fedchyshyn. “Our strategic decision, a few years ago, to form a combined team of Portfolio+ Inc. and Manulife Bank professionals to help meet our goals was a great success. We now have a team of experts that assesses and responds to market opportunities at a speed and depth I’ve rarely witnessed in our industry.”

The Preferred Services Group at Portfolio+ Inc. employs specialists in virtually every area of banking, including loans, term deposits, investments, retail, electronic messaging, and platform technologies.

The Preferred Services Group is available to Portfolio+ Inc. customers who have a unique need for customization, support, and testing that goes beyond what is supplied with a standard software support agreement.

About Manulife Bank

Established in 1993, Manulife Bank was the first federally regulated bank opened by an insurance company in Canada. It is a Schedule l federally chartered bank and a wholly-owned subsidiary of Manulife Financial, one of Canada's leading financial institutions.

As of November 2009, Manulife Bank has more than $15.5 billion in assets and serves clients across Canada in all provinces and territories. With a high-quality loan portfolio, the majority of loans being in residential mortgages, Manulife Bank is a profitable and well-capitalized organization.

Manulife, Manulife One, and the block design are registered trademarks of The Manufacturers Life Insurance Company and are used by it and its affiliates, including Manulife Bank of Canada.

Used with permission.

About Portfolio+ Inc.

Portfolio+ Inc. connects financial institutions with customers and partners using innovative technologies. Its software solutions and open banking technology are used by financial institutions in Canada, Ireland, and the UK. With its powerful +Open Banking Platform and fully documented APIs, Portfolio+ has the power to connect banks, credit unions, and financial institutions with an evolving ecosystem of financial services technology that is putting everyday customers in control of their financial data.

Located in the Greater Toronto Area (GTA), Portfolio+ is used by 6 of the 7 largest financial institutions in Canada and is a part of Volaris Group Inc.