New Generation Core Banking System For Sustained GrowthA Solution with Temenos T24Nguyn Hng MinhDeputy DirectorCenter for Technology based Product Development and ApplicationTechcombank

ScenariosVietnam economy continues to have high rate of growthincreasing consumer income and spendsBooming Banking ServicesConsumers have become more demanding, sophisticated and less loyalWay given to multilateral arrangements between bank, customers, distributors and other partiesBanks being forced to share more revenue with third party distributorsIncreasing regulatory and compliance requirements by the State Bank (SBV)

Banks Towards Customer CentricMost retail Banks whilst claiming to be customer oriented continue to structurally operate in product centric modelThis structure constrains Banks to view Customer relationships panoramically, resulting in fragmentation of Customer relationshipsInability to provide consistent customer experience and inability to meet increasing aspirational needs of customers

Implications for BusinessNew Business Models, delivery channels and newer services are pushing Banks operating on legacy systems to upgrade /replace their Core Banking SystemsThe Alternatives to this are Inability to respond rapidly to changes in market placeHigher Costs of operations resulting in being priced out of market and hence diminishing market share

Weave Business and IT Strategies Together

IT strategies flow from bank strategic intent

Align Core System Strategies to Business ImperativesSample Business NeedsDevelop new products quickly and reduce time to market

Enhance customer satisfaction by enabling 24*7 banking

Improved servicing for customer transactions Reduce costs and drive economies of scale through shared best practiceSample IT ImplicationsSystems must be flexible to provide for parameterization by which new products /services can be added without major modificationsProvide range of offering on alternate channels Internet , ATMs , mobile banking etc On Line STP with automated exception handlingRobust and scalable systems enabling huge amounts of transaction processing

Customer Centric Operating Model

Approach to Core Banking System UpgradeUse the opportunity to transform the Business rather than just replicate legacy A Core Banking Project is a Business Project which is enterprise wide with Technology being an enabler to help Business achieve the benefits it seeks Do not attempt to build a core banking system !!!

Selection Evaluation CriteriaVendor / Partner track record and expertiseTechnology PlatformOpen Architecture Integration flexibility with in house and third party Scalability and future proof Application securityFunctionality fit /richness

Temenos A Company Profile500+ institutions, 600+ live locations

TemenosVendor being a solution partnerProviders

Reactive

Task orientation

Short termPartners

Proactive

Solution orientation

Long term

T24 Core Banking System

Open StandardsOpen platformOpen databaseOpen J2EE application serverIntegratedCustomer relationship management (CRM)Centralized common processesConsolidated Global Customer View (Know Your Customer)Centralized Risk ManagementParameter DrivenUser Customizable - Independent of supplierRapid time to marketBest of Breed Practices Decades of banking experience backing core applications & processesMission critical24 * 7 * 365No End of Day Batch processing Investment protectionDevelopment philosophy - upgrade policyLong term strategy

BusinessITOperationsCustomerTEMENOS T24 as Enabler of Growth and EfficiencyOperational excellenceBusiness agilityCustomer choice and retentionElimination of batchReduction of cost of HW infrastructureReduction of risk & reg. complianceSystems consolidationand standardisationEfficient business pipeline managementTEMENOS VALUE PROPOSITION

Techcombank Upgrades to T24R5Project Milestones

Undertaken in October 2005Non stop capabilities & Multi Server modules achievedProject completed in 8 weeks

Techcombank before and after T24 UpgradeBeforeSingle Server ArchitectureEnd of Day Batch WindowPerformance Limits Reached Multi-company LD/ PDAfterMulti-server Architecture Non-stop ProcessingImproved Performance Enabling GrowthMulti- book AZ

T24 Upgrade - Benefits derived for TechcombankIncreased ROIsDevelop new products and services at easeEnable bank to concentrate on ideas and marketing while T24 take care of the rest.Reducing CostsImproved efficiency in real-time processing results in lower costsManual processes and paper flows are reduced by increasing computerized informationImproving ProductivityAll modules are integratedFront, middle and back office operations are fully supportedTimely information are provided

Thank you!