The Banking Software Company

TEMENOS NEWS ISSUE 21 MAY 2010

The road
ahead for
retail banking
From regulatory compliance
to new rivals: the challenges of
a changed landscape

Enhancing our offering Dematerialisation

Viveo acquisition gives Temenos The rise of a powerful new
AML and payments expertise approach to reducing costs
Anti-money laundering New front office strategy Secrets of profitable banks
BforBank Bank of Shanghai North Shore Credit Union Partnership strategy
 ISSUE 21 | may 2010 TEMENOS NEWS 3

| 3 ANDREAS ANDREADES: equipped for the journey | 4 NEWS | 6 LEAD STORY: retail banking
| 9 partner viewpoint: deloitte | 1o viewpoint: Front office | 11 CASE STUDY: bank of shanghai
| 12 feature: TemenoS ACQUIRES VIVEO | 14 viewpoint: creating value
| 15 VIEWPOINT: dematerialisation | 16 case study: bforbank
| 17 case study: north shore credit union | 18 Temenos partner strategy

Equipped for the journey

There is a mood of cautious optimism among banks as the
first signs of recovery appear in the marketplace. There are andreas andreades
complex challenges ahead for the retail banking sector, which is CEO
experiencing the aftermath of a significant reduction in consumer temenos
trust post-crisis. Retail banks are also dealing with increased
regulatory requirements and heightened competition with the
arrival of new entrants. See our main feature on page 6 to find out
how banks are addressing these issues, and the viewpoint from
Deloittes Tim Walker on the outlook for retail banking.

The banking sector in China is experiencing extremely high growth,
creating unprecedented opportunities for those organisations
that can move quickly and decisively. On page 11, you can learn
about how Bank of Shanghai is achieving record-breaking results
by leveraging the benefits of TEMENOS T24 (T24) to surge ahead
in this challenging market. BforBank (France) is a start-up internet
bank that is reaping the benefits of the 24x7 system offered by
T24 to enable non-stop online services and ease of integration
with other systems. Another Temenos success story is North Shore
Credit Union in Canada, which is using T24 to boost product
innovation and customer service.
Despite the pressures of the economic crisis, we are honoured
to have retained our titles as the Number 1 Best Selling Core
banking systems in the International Banking Systems 2009 Sales
League Table and Banking Technologys Readers Choice Award for
Best Core Banking Product of the Year. Temenos claimed both of
these titles for the third year in a row, which is a testament to the
strength of our offering.
As the markets change, Temenos is evolving its business to ease
this journey for banks as we move forward. Our acquisition
strategy reflects our commitment to equipping banks with the
technological excellence they need to remain ahead of the curve
during these demanding times. Our successful acquisition of Viveo
in France has enabled us to strengthen our product offering further
in the important areas of anti-money laundering (AML) and
payments. See page 12 for more information on the opportunities
arising from this acquisition.
This issue comes to you as we host our annual Temenos Community
Forum (TCF), taking place this year in Berlin. At this time, we have
the opportunity to celebrate the many positive relationships we
share within our global business network. The theme of Temenos
Community Forum this year is Innovation, service and efficiency
the route to profit. We look forward to seeing a healthy profit in all
our partners and customers businesses this year.
We hope you enjoy this issue.

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(referred to as Temenos Community Forum), TEMENOS Globus (referred to as Globus), 18 Place des Philosophes
CH-1205 Geneva
TEMENOS jBASE (referred to as jBASE), TEMENOS, are registered trademarks of the TEMENOS GROUP.
Switzerland
Tel: +41 22 708 1150
For further information or your feedback, please e-mail us at marketing@temenos.com Fax: +41 22 708 1160
www.temenos.com

2010 TEMENOS HEADQUARTERS SA all rights reserved. Warning: This document is protected by copyright law and international
treaties. Unauthorised reproduction of this document, or any portion of it, may result in severe and criminal penalties, and will be
prosecuted to the maximum extent possible under law.
4 TEMENOS NEWS
After a rigorous technical assessment of the leading
sanctions screening solutions available, the decision
to select Temenos for Barclays global initiative was
relatively easy
Paul Fabara, Barclays
Barclays selects TEMENOS AML
Barclays has selected TEMENOS AML (AML)
as its preferred global sanctions solution
for payments screening. Having been
benchmarked against other market leading
competitors and proven to be the fastest
and most operationally efficient offering,
AML will be deployed globally to replace
existing platforms and consolidate the
payments and transactions screening. The
development of TEMENOS AML follows the
recent acquisition of AML specialist Viveo
(see Viveo feature, page 12).
AML includes Linguistics, which will
enable the banks Next Generation
Programme to achieve superior levels of
screening. The application of Linguistics
in Barclays is a sophisticated solution
to address the increasing challenges of
cultural variations and subtleties. This
heightened detection capability is coupled
with Temenos industry leading intelligent
false positive reduction methods, designed
to drive down total cost of ownership and
increase operational efficiency.
Paul Fabara of Barclays commented:
Deloitte agreement provides end-to-end service
Temenos has entered into a relationship
agreement with professional services
firm Deloitte, who will provide consulting
services around implementations of the
award-winning TEMENOS T24 (T24)
core banking platform. This will combine
Deloittes capabilities for complex bank
transformation programmes with the proven
products, methodologies and tools that
Temenos offers, to provide customers with a
comprehensive end-to-end service.
The agreement covers the UK and
Switzerland, with plans to extend it globally.
It will benefit clients by bringing local
market insight and regulatory understanding
combined with a consistent level of service
within and across markets.
Deloitte and Temenos have worked
After a rigorous technical assessment of
the leading sanctions screening solutions
available, the decision to select Temenos
for Barclays global initiative was relatively
easy. He added: The banks approach to
global compliance is unequivocal. We want
to lead by example and have found the right
product to help us protect that position.
We are delighted to have been selected
by Barclays to support its global Sanctions
Screening requirements. In light of Barclays
strategic approach to Sanctions Screening, the
selection of Temenos as the vendor of choice
clearly demonstrates the comprehensive
nature of the Temenos solution, said
Jean-Michel Hilsenkopf, Regional Director,
Temenos. As regulatory challenges for banks
increase, Temenos market leading experience
represents a major step forward in protecting
individuals and institutions against Sanctioned
Entities and Terrorist Financing.
Andreas Andreades, CEO, Temenos added:
This is a very exciting time for Temenos
as we enter into the AML market through
the successful acquisition of Viveo. We have
together successfully in the past and this
agreement formalises the relationship
and provides the basis for a much closer
collaboration in the future. The first activity
is already underway a global consulting
project advising on a T24 rollout.
Over the next three years, Deloitte will
invest in the training and certification of a
team of consultants on T24 who will work
with the established Temenos methodology
for the implementation of T24 Model Bank.
Deloitte Partner Tim Walker said: We believe
that banks adoption of packaged solutions is
set to accelerate as it offers a route towards
radical improvements to their efficiency and
their ability to offer new products and services
and enter new markets.
Mike Head, Temenos Global Alliances
made excellent progress integrating the
product into our business model and this new
signing demonstrates how we are already
seizing opportunities in this growth market.
The regulatory landscape and heightened
enforcement actions are impacting financial
institutions sanctions screening efforts and
responses to money laundering, for which
technology plays a vital role.
George Koukis of Temenos (left) and Paul Fabara of Barclays
Director, added: The relationship with
Deloitte is extremely important for the
Temenos community. It will greatly enhance
choice for our customers, bringing them
world-class business management and
project delivery skills.
Jason Deering, a Deloitte specialist
with banking platform implementation
experience across a dozen markets,
commented: The trend for package-based
implementation has moved from local, to
regional, to global. Implementations will
always benefit from a local presence that
offers both insight and delivery capability.
This relationship gives clients confidence
of a consistent methodology, implemented
by Temenos specialists and certified, local
Deloitte professionals.

T24 will enable automation of currency and
bilateral loan processing to reduce cost by
eliminating manual intervention
Jrgen Wittenkamp, Danske Bank
Danske Bank cuts costs
with new lending platform
Danske Bank, Denmarks largest bank, is to
implement TEMENOS T24 (T24) Model Bank
for Corporate Banking as its new lending
platform. T24 will support Danske Banks loan
processing across ten countries in northern
Europe to reduce operational costs.
T24 will enable automation of currency
and bilateral loan processing to reduce cost by
eliminating manual intervention. By delivering
a comprehensive and real-time picture of all
credit exposures, T24 will give us improved
business processes and operational efficiency,
explained Jrgen Wittenkamp, Head of Loan
Systems at Danske Bank.
Danske Bank selected T24 Model Bank
to replace its legacy system and support
its corporate lending business on a single,
open platform. T24s functional richness
and openness will address all functional
requirements and enable smooth integration.
Microsoft partnership increases efficiency
Temenos has entered into a new alliance with
Microsoft to deliver core banking solutions
that greatly increase operational efficiencies
for large-scale banks worldwide.
By choosing the Microsoft platform,
TEMENOS T24 (T24) customers will benefit
from open, modern technology to accelerate
innovation, greatly increasing the speed
and effectiveness with which new products
and services are created. This increased
operational efficiency enables front-line staff
to provide superior customer service at a
lower total cost of ownership.
Already 31 banks have selected TEMENOS
Insight, the business intelligence (BI) suite
announced in March 2009. Leveraging the
BI capabilities of SQL Server, TEMENOS
Insight enables T24 users to analyse and track
financial performance, understand customer
profitability and manage risk.
As a bank that has historically run in-
house systems, we are delighted to have
been selected by Danske Bank to support its
corporate lending business. This demonstrates
that corporate banks are increasingly turning
to advanced packaged core banking software
to centralise multi-country operations
for significant improvements across risk
management, cost control, product innovation
and customer service, said Andreas
Andreades, CEO of Temenos.
Microsoft has a long-term commitment to
supporting mission-critical operations in financial
services. Our alliance with Temenos provides
our largest financial services customers with a
cost-effective platform on which they can build
future-generation processing capabilities that
meet the evolving demands of their business,
said Susan Hauser, Vice President, Worldwide
Industry and Global Accounts, Microsoft.
Temenos has also extended its global
strategic alliance with IBM, launching the Java
version of Temenos Core Banking (TCB) and
T24 for IBMs System z server, and has agreed
a new partnership with GFI Informatique to
deliver TEMENOS T24 in France and other
southern European countries.
See page 17 for information on the Temenos
and Microsoft alliance implementation at
North Shore Credit Union
TEMENOS NEWS 5
Record numbers go live in 2009
2009 saw more than 50 Temenos clients go
live with new systems, a record high for the
company.
Leading microfinance institution Opportunity
International, a longstanding Temenos cus-
tomer, has gone live on T24 Biometrics in
Chennai, India as part of a project to roll out
biometric authentication across multiple loca-
tions worldwide. The company is implementing
T24 Biometrics for customer authentication,
including biometric login and transaction
authorisation for T24, as well as single sign-on
access for other business applications.
We have established over a dozen formal fi-
nance institutions (FFI) to broaden our services
network, said Frank Livingston, Director of MIS
Development at Opportunity International.
As weve continued to expand, our technology
needs have evolved. The ability for our FFIs to
identify customers as effectively and efficiently
as possible when transacting business is a criti-
cal success factor.
CfC Stanbic Bank in Kenya has implemented
T24 Model Bank as part of an operational
merger. The decision was taken to partner with
Temenos and consolidate the two businesses
onto the T24 Model Bank platform.
AF Bank in Russia implemented T24 in its
head office and five regional branches in under
nine months. Replacing ten systems with T24
has transformed our infrastructure, giving us
the functional breadth to expand our product
range, said Aidar Zubairov, Chairman of AF
Bank.
Other clients to go live include Sacombank in
Vietnam, where over two million customers are
now supported.
Temenos tops IBS sales league
Temenos has attained top ranking in the IBS
Intelligence Sales League Table for the third
year running for its sales of back-office banking
systems to new clients. Martin Whybrow, Editor
of International Banking Systems Journal, com-
mented: Temenos had a strong year, continu-
ing to sell well in most geographies and gaining
its fair share of the years high-end and multi-
site deals. The breadth of T24 is a strength, as is
Temenos international reach and resources.
6 TEMENOS NEWS
The road ahead
for retail banking
There are testing times ahead as retail banks get to grips
with fundamental changes to their working environment
following the economic crisis
In the post-crisis landscape, those banks
that weathered the storm face a changed
environment. Loss of trust in the banking
sector and anxiety over the safety of long-term
deposits are shaping customer responses to and
demands of their banks. Meanwhile, financial
institutions face greatly increased regulatory
burdens, along with competition from new
entrants to their markets.
If regulators enforce more stringent Tier
1 capital requirements, banks will either
need to curtail certain activities to remain
within their newly defined capital base, or
raise more capital, says Gareth Jones, Retail
Business Development Director at Temenos.
The former will impact revenues and profits,
the latter dilute shareholder return. Either
way, increased efficiencies are needed to
soften the blow. Banks have been cutting
costs over the last 12 to 18 months and now
that the low hanging fruit of cost reduction
is gone, the challenge is to find ways to take
further costs out of the business, without
adversely impacting the institution.
The IDC European Banking Advisory Services
Financial Insights: Top 10 predictions for
2010:The Year of Intelligence forecasts that
banks will cut back on IT spending and will
concentrate mainly on tackling issues around
risk. The report also foresees a shift in attitudes
to regulatory requirements, predicting:
Banks will no longer be able to afford tactical
regulatory compliance as IT budgets for
compliance grow to 25 per cent.
Banks will increasingly stand or fall on their
ability to improve their operating efficiency
and effectively address regulatory and market
challenges, says Tim Walker, a partner at
Deloitte. The innovators in this space are those
 TEMENOS NEWS 7

Retail banks for too long have treated customers as a fairly

homogenous, amorphous group. Now it is time to focus
on providing appropriate offers. Its not just about product
innovation but how customers are treated
Gareth Jones, Retail Business Development Director, Temenos

banks that are tackling issues caused by complex
legacy technology, centralising operations
regionally and globally, improving their internal
controls and governance, motivating their
employees, working well with their strategic
suppliers and providing better value products
and improved accessibility to their customers.
Even banks in countries not directly affected by
the global crisis are feeling the impact of new
regulatory demands. For Kenya Commercial Bank
(KCB), a robust automated system is the key to
coping with several new demands arising from the
international crisis. In addition to implementing
the Basel II capital adequacy systems, the
bank faces added requirements for services
in operational risk, market risk, anti-money
laundering (AML), automated fraud monitoring
for both the banking and the credit card business,
and the implementation of PCI/DSS standards. A
shared regional infrastructure for credit rating is
also being set up. Automation is seen as key to
delivering on all these areas, says Tony Githuku,
Divisional Director, Information Technology at
KCB Bank Group, Kenya.
Those banks that already have robust, modern
infrastructures will have the advantage of being
able to keep expenditure to a minimum. This is
one of the strongest factors influencing a rise in
new entrants to the retail banking market, from
start-up banks to retailers such as supermarkets
looking to launch customer banking services.
Newcomers are enjoying unprecedented
opportunities to displace retail banks, says Rachel
Hunt, an analyst at IDC. There have been a lot
of new applications for banking licences more
than 50 applications over the past 12 months.
These players will have the advantage of lower
maintenance costs thanks to new back office
systems and IT infrastructures, remarks Hunt.
They will be much more integrated from front to
back, having been able to review best practices for
the business processes and work flows.
Temenos sees a strong threat coming from new
entrants who cross industries, not just start-
ups, says Jones. There are a lot of potential
opportunities for both retailers and telecoms
providers because they have mass access to
customers. They have a lot of the infrastructure
to handle billing and customer records, as well as
strong distribution channels.
Telecommunication companies are already
active in payments in Africa, says Githuku. The
MPESA system from Safaricom is a global first in
size and capability for efficient money transfer
using mobile phones. Many banks, including KCB,
have opted to allow transactions with MPESA,
either by mobile handset or via ATM, both
providing new customer convenience.
8 TEMENOS NEWS
Flexibility and ease of use on all the channels is key
Tony Githuku, Divisional Director, Information Technology, KCB Bank Group, Kenya
In Channy, president and CEO of ACLEDA Bank, believes that
forward-thinking policies will help established banks to prevail
against non-traditional incomers. As a mature bank, we are very
proactive towards our customers needs. For example, when ACLEDA
transformed to a bank in 2000, we knew that we needed to have a
system in place from day one to support our growth, manage risks,
and be responsive to our customers expectations. As one of the
newcomers, ACLEDA Bank has developed quickly and grown faster
than the players that already existed.
Both established and non-traditional banks will have to deal with the fact
that customer expectations of brands and service levels have changed as
a result of the financial crisis and institutions are going to have to work
harder to win trust. So what new customer demands have arisen in terms
of products and services, and how are banks responding?
Savings customers have shown a marked flight to quality, says Walker.
For those with large deposit balances above the ceiling imposed by the
local depositor protection scheme, there has been a dispersal of deposits
across multiple institutions. Weve recently noted a greater willingness of
customers to move their banking relationships because of underserved
needs such as service expectations and transparency in pricing.
For Deloitte, a key factor in the battle for customers will be improvements
in customer service, part of which will be the extent to which channels
are integrated. Walker notes: The requirement to put deposit gathering
at the heart of the retail agenda implies branch- and service-led
differentiation. The traditional banks may be forced to make radical
efficiency improvements in the branch network, including changing what
is done in the branches and the branch network footprint and improving
cross-channel integration. He believes that these improvements will be
easier to implement in those banks that have a more integrated banking
platform once again indicating a competitive advantage for new
entrants unencumbered by legacy estates and infrastructure.
New entrants to the market
will be much more integrated
from front to back, having
been able to review best
practices for the business
processes and work flows
Rachel Hunt, Analyst, IDC
The big new challenge is to create a seamless fit between channels,
says Hunt. Banks really need to do the integration work that will
enable them to be more flexible on the mobile channel in particular,
to prevent it from being seen as just as an extension of the internet
channel. A new channel requires a redesign of how the products
are sold. It is critical that customers have the ability to transact on
different channels while receiving similar seamless experiences, says
KCBs Githuku. At the moment, the important channels are mobile,
internet, ATM and branch, in that order. Flexibility and ease of use in
all these channels is key.
Jones argues that cross-channel integration is important but warns
about it being the sole focus. We also need to recognise that some
sectors are going to want to interact increasingly on a remote
basis. The currently unbanked youth, when they come of banking
age, may never want to walk into a branch even to establish the
relationship initially. Likewise, he says, not all established branch
customers are interested in a cross-channel experience.
Not surprisingly, there are signs that banks are placing a higher
premium on putting the customer at the centre of the banking
experience. There is a great opportunity to use technology to
innovate around process optimisation, improving efficiencies and
removing silos, notes Jones.
ACLEDAs Channy echoes the conviction that innovation is crucial
if banks are to keep up with heightened customer expectation.
Everybody in the banking industry is trying to do the same thing
better, faster and more securely. If you dont have innovation, you
will lose customers because your competitors are always trying to
improve service quality and respond to customer needs.
Some banks are already using groundbreaking new techniques
such as allowing customers to compare themselves to their peers
in terms of their financial behaviour, says Hunt. This is data that
the banks already have, and they are delivering it to the customer
as a usable service. Its all about integration of silos, extracting
information and repackaging it in a customer-friendly manner.
The ability of banks to engage with their retail customers as
individuals will be key during the recovery. Deloittes Walker
comments: How a bank prices its products and product bundles,
according to the relationship with each individual customer, is an
area where innovation could lead to competitive differentiation.
The prospects are good for banks that can find ways to connect
with their account holders in more meaningful ways, says Jones.
Retail banks for too long have treated customers as a fairly
homogenous, amorphous group. Now it is time to focus on
providing appropriate offers. Its not just about product innovation
but how customers are treated.
 TEMENOS NEWS 9

Branches and services will remain critically important for current

accounts, savings and mortgage products and be a real way for
new entrants to differentiate
Tim Walker, Partner, Deloitte

Partner ViewpoinT

The new retail banking market

A more realistic approach to risk on the part of retail banks is just one of the factors that will shape the
market this year and beyond. Tim Walker, Partner at Deloitte, looks at how the industry is changing

The retail banking sector is undergoing
a cyclical restructuring in the light of
changes to market dynamics as a result
of the credit crunch. In our view, this will
result in more rational pricing of loans, a
consolidated competitive landscape, and a
focus on traditional forms of balance sheet
funding driven by retail deposits.
Banks are refocusing from the asset to the
liability side of the balance sheet, with an
increased focus on margins and re-pricing
of new business. We have seen some
consolidation and market exits but also new
entrants, not encumbered by back book issues,
who are attracted by the renewed profitability
of the sector. In all of this, the importance of
brands, customer touchpoints and consumer
trust is heightened, as banks seek to secure
profitable customer relationships, and exit
those that are unprofitable or high risk.
Alongside the changes in the market, there is
every indication that regulators will become
more intrusive and demanding, forcing banks
to increase their protection against default
and reduce potential future reliance on the
state to bail them out in times of crisis.
We recently commissioned a survey
of around 2,000 UK consumers, which
demonstrates a clear demand for more
service-led propositions in the retail banking
sector. Compared to two years ago:
Around 70 per cent of consumers are more
aware of their finances
6 out of 10 consumers are much more
concerned about how safe their bank is
Two thirds of consumers have become
more concerned about how their bank
treats its customers, with more than a fifth
of consumers having moved a banking
relationship due to this dissatisfaction
A quarter of consumers are prepared to
move their relationship to a new, non-
traditional bank based on considerations
such as fees, service, ethics and
management pay. Conversely, those that
wouldnt consider such a move state that
security of their money and expertise at the
traditional banks are the key factors.
New players will seek to capitalise on
consumer distrust of traditional banking
brands, the lack of alternatives and the higher
margins that the industry is now experiencing.
In the UK, a number of organisations are
preparing to enter the banking market, aiming
to take market share from incumbents
burdened by merger integration and disposals
as well as de-risking their own balance sheets.
Our research suggests that branches and
services will remain critically important for
current accounts, savings and mortgage
products, enabling new entrants to
differentiate.
There are typically two routes to market for
new entrants acquire and extend existing
banking assets or build a greenfield bank.
Both routes require funding at the right
price and deep management expertise and
will come under heavy regulatory scrutiny.
The increasing availability of localised third
party banking platforms and new pricing
and sourcing models for these is removing a
significant barrier for new entrants.
As the flow of wholesale capital dries up and
regulation intensifies, a number of flawed
business models have unwound. Banks are
repricing loan books to reflect the real risks
underlying them, while the funding of current
accounts by overdraft fees will remain under
intense scrutiny.
looking ahead
Deloitte predictions
Growth in branch-based savings
UK banks may end free current accounts or
force customers to bundle them with other
products although very efficient banks may
be able to offer significantly lower fees. Personal
loans will become more expensive and credit
card balances will contract as banks look to
reduce their higher risk-weighted assets.
Increase in mortgage profitability for banks
Mortgages will become less commoditised,
more expensive for consumers and
more transparently priced. Arrears and
repossessions may decline, due to the long-
term low interest rate environment.
A shift to own branded channels for
traditional banks
Power is shifting back to product
manufacturers and trusted consumer brands.
Branches will become a key battleground for
retail banks as they experience pressure to
drive affordable retail deposit funding.
Other trends:
Customers will increasingly research online
and fulfil in branch
Lenders will take greater control of distribution
The number of intermediaries such as
mortgage brokers will decline due to the
disappearance of sub-prime mortgage
commission
New entrants will address their lack of
branch footprint by concentrating on direct
propositions
10 TEMENOS NEWS

Our aim is to help T24 banks leverage sophisticated technology to

deliver a truly differentiated customer experience as the basis for
continued growth and profitability
Koen Van den Brande, Product Director, Front Office, Temenos

ViewpoinT

Sophisticated front office

strategy for Temenos
Building on a strong track record in helping banks address cost and operational efficiency
issues, Temenos is developing a robust new front office strategy

In recent years, Temenos has proven
the value of the T24 Model Bank and
Reference Processes in helping banks
quickly implement modern core banking
technology to stay ahead of the cost
curve and deliver superior levels of
profitability and cost/income ratios. By
implementing T24, banks put in place
a highly flexible platform that enables
them to keep fine-tuning processes
over time, to ensure ongoing regulatory
compliance, to support competitive
product innovation and, most
importantly, to enable their staff to
understand and serve customers better.
So why are we talking about a new front
office strategy for Temenos? The reality is
that Temenos has not to date attempted to
build a business which is focused entirely on
helping the banking industry improve the
customer experience. And yet over time, we
have put in place many of the technologies
that are a prerequisite to making this possible.
Not only does T24 have a built-in single
customer view across a broad portfolio
of banking products, in addition we have
invested in process and workflow capability,
a rules engine, event processing and an open
multi-channel architecture with support
for branch, call centre and internet, and the
ability to complement these with partner
offerings for mobile banking and interactive
voice response capabilities.
With T24s Acquire, Retain and Cross-
sell (ARC) set of modules, we have laid
the foundations for integrated customer
relationship management capabilities around
the definition of marketing campaigns,
identification and tracking of opportunities,
and the fulfilment process and workflow.
The new front office strategy recognises
that technology spending by banks is often
evenly balanced between front and back
office. When the focus shifts to customer
acquisition, service and retention, front office
spend tends to significantly exceed back
office spend.
Hence Temenos will demonstrate a renewed
focus in coming years on the front office,
with investments in branch automation, a
next-generation internet banking platform
and extended mobile banking capability.
This will be complemented by specialised
workflow-based origination functionality,
combined with a new focus on real-time
customer analytics. We will also add personal
financial management capability to help
build a consolidated picture of the customers
financial profile. There will be sophisticated
needs analysis, and finally a real-time decision
engine to assist bank staff with maintaining
a meaningful conversation with customers,
based on the wealth of information available.
Our aim will be to help our customers
to leverage sophisticated technology to
deliver a truly differentiated customer
experience as the basis for continued
growth and profitability. As part of this, our
focus for R11 will be on the four elements
of branch, internet, mobile and origination.
In the branch, we will further enhance our
teller functionality. The new multi-line
transaction capture mode wilI feature
increased support for easy integration of
specialised teller devices. This is one of the
first functions to benefit from the new T24
user interface.
On the internet, we will introduce new
capabilities to enable a banks web designers to
create a highly customised and brand-specific
customer experience, extending existing
capabilities for retail, corporate and wealth
management use. In an effort to help our
customers build deeper relationships with their
customers, we are exploring the possibility of
enhancing the retail internet experience by
means of the addition of personal financial
management capabilities.
In mobile banking, we are anticipating
rapidly growing demand and will be
working closely with our partner FE-
Mobile on closely integrating the mobile
banking platform with T24s multi-channel
architecture. With this mobile platform,
we also have an opportunity to engage in
mobile commerce applications, which are
already showing signs of driving adoption.
Finally, we will build on our existing loan
origination capabilities (available with the
combination of LO24 and the T24 workflow
engine PW) to introduce next-generation
origination capabilities. This will be built
entirely around workflow and will be capable
of interacting with external third-party
process orchestration engines. Starting with
R11 and for coming releases, we are keen to
engage in a dialogue with our customers to
ensure we fully recognise their requirements.
Feel free to join in the discussion on the
Customer Collaboration Portal.

With T24, Bank of Shanghai has effectively
future-proofed its IT infrastructure
Jiang Hong, Vice President, Bank of Shanghai
case study
Bank of Shanghai
Bank of Shanghai is using T24 to achieve strong results in the booming Chinese banking sector
Bank of Shanghai has adopted T24 to
help it take advantage of the significant
market opportunity in China. A booming
economy and mass urban migration are
creating the conditions for accelerated
growth in the Chinese banking sector. But,
given that the government is deregulat-
ing and internationalising the market,
competition is also increasing. As Bank of
Shanghai appreciated when it made the
decision to replace its core system, only
the most agile players will truly be able to
capitalise on the opportunities available.
Bank of Shanghai (BOS) is the largest bank
in China to have successfully replaced its
core system with an international packaged
solution. In 2002, it undertook a selection
process that evaluated the option of an
internal build alongside the option of taking
a packaged solution from an international or
local vendor. In the end, the banks desire to
adopt international best practices saw it come
down in favour of an international solution.
Among the systems considered, T24 from
Temenos emerged as the clear preference based
on customer references, level of integration,
implementation record, functional coverage
and strength of business processes. A complex
implementation involving high levels of
localisation and process reengineering, the
project was delivered fundamentally on time
and on budget. The project was started in 2004
and T24 went live in the corporate bank in 2006
and in the retail bank in 2008.
Since going live, T24 has acted as an important
catalyst for Bank of Shanghais strong recent
absolute and relative financial performance.
Jiang Hong, Vice President, Bank of Shanghai,
comments: With T24, Bank of Shanghai has
effectively future-proofed its IT infrastructure.
We have a platform that is robust and scalable
enough to support our ambitious growth plans.
TEMENOS NEWS 11
We also have a platform that allows us to around 700,000 new corporate and retail
standardise our processes and extract the scale customers, yet its IT headcount increased by
benefits of growth. Lastly, the system allows only 68 people. We estimate the banks ratio of
us to have one complete view of the customer IT costs to total costs to be around 4.8 per cent,
across all operations and gives us the flexibility translating into an IT cost to income ratio of
to take advantage of this, by tailoring products 2 per cent. To put these figures in context, the
and services to individual customer needs. banks IT/total cost and IT/income ratios are,
respectively, 71 per cent and 82 per cent below
By affording a single view of the customer, the average for European retail banks (source:
T24 has enabled seamless service across all Boston Consulting Group). Furthermore, its ratio
channels, quicker decisions (mortgage approvals, of IT cost to total assets is 44 per cent lower
for example, are given 75 per cent faster than than that of other Chinese banks.
before) and a differentiated experience for
customers. Better customer service is translating By offering up-to-date, integrated and complete
into faster growth: in 2008, Bank of Shanghai information, T24 has help to considerably
grew loans at 18 per cent compared to the peer improve risk governance and management
group average of 16 per cent, and deposits at decision-making. Non-performing loans (NPLs),
21 per cent versus the peer average of 19 per for instance, have fallen continuously since 2006.
cent (A Temenos study benchmarking Bank of By the end of 2008, the banks level of NPLs
Shanghais performance against 22 similar sized was 2.2 per cent compared to 2.3 per cent for
Chinese city commercial and joint stock banks the peer group and 2.4 per cent for the Chinese
is available on request). We also estimate that banking sector as a whole (source: CBRC).
the bank grew revenue per customer by around
16 per cent. In 2008, Bank of Shanghais return on capital
was 125 per cent higher than the average for
T24 has dramatically reduced the cost and the top 1,000 banks (source: The Banker) and 15
time to market for new products. Development per cent higher than domestic peers.
times have been reduced by between 60 per
cent and 75 per cent and development costs by
even more. BOS is launching new (often truly
pioneering) products on average every one to
two weeks. It was the first bank in China, for
example, to launch a joint retail and corporate
card. In the last two years, the bank has grown
fee-based income at a compound rate of 25
per cent, to a level that is 1.6 times the average
for city commercial banks and its net interest
margin, for the first time in 2008, overtook the
level of peers.
As an integrated and robust solution, T24 has
allowed BOS to extract IT economies of scale
as it has grown. In 2008, the bank grew its
operating income by 28 per cent and added
12 TEMENOS NEWS

We believe that the AML market offers significant growth potential
and our success in penetrating this market will prove an important
factor in executing our ambitious growth plans for Temenos
Andreas Andreades, CEO, Temenos

Enhancing our offering:

Temenos acquires Viveo
The acquisition of Viveo promises powerful new capabilities in several core areas of expertise

With the integration of Viveo at the end of 2009, Temenos made
its largest acquisition to date, creating a powerhouse in the French
market. The combination of the two companies businesses in France
creates a group with a market share of around 50 per cent, with 800
customers, 480 employees and offices in Paris, Brussels, Geneva,
Bucharest and Casablanca. During the first three months of working
together, the Viveo and Temenos teams have focused on communicat-
ing their respective solutions in order to gain a clear understanding of
specific strengths and points of convergence.
The alliance with Viveo in the French market has delivered some
key products that Temenos will promote. In particular the ranges of
online and mobile banking products are very mature. In addition, the
new combined French territorial offering includes the most compre-
hensive solution to French regulatory and reporting requirements in
the market.
On 30 March Temenos and Viveo organised an event in Paris for 200
customers. The main objective was to present the new strategy and
product range for the French-speaking market. Solutions include
TEMENOS T24, TEMENOS Insight, V.bank online, V.bank regula-
tory, V.bank promo, TEMENOS AML and TEMENOS STeP payments
repair. The event was attended by representatives of 150 financial
institutions.
The Viveo acquisition broadens the Temenos product offering, moving
more materially into the anti-money laundering (AML) and payments
areas. A new product range has been developed, based on TEMENOS
T24, which will be promoted worldwide.
This is a very exciting time for Temenos as we enter into the AML
market through the successful acquisition of Viveo, says Temenos CEO
Andreas Andreades. We believe that the AML market offers significant
growth potential and our success in penetrating this market will prove an
important factor in executing our ambitious growth plans for Temenos.
There have already been several encouraging signs that the Temenos-
Viveo alliance has got off to a good start. The financial markets have
reacted well, and there has been positive feedback from Viveo custom-
ers. The new team has also signed two significant new contracts: with
Barclays for the AML solution and with Tunisian Foreign Bank (TF Bank),
a V.bank customer that has now selected T24.
TF Bank chooses Temenos-Viveo solution
Established in 1977 as Union Tunisienne de Banque (UTB), Tunisian
Foreign Bank (TF Bank) has its head office in Paris. The banks custom-
ers include Tunisians living abroad, professionals, small and medium
enterprises and corporate customers. The agreement with TF Bank,
which has been a Viveo customer for three years, represented the first
opportunity to showcase the new Temenos-Viveo product range and
the shared work of sales, pre-sales and services teams.
In 2009, as part of its development strategy, TF Bank decided to
replace its IT system with global banking software. As it had already
used several modules from Viveo, the bank signed up for V.bank, the
Viveo global banking solution. Early in 2010, following the acquisition
of Viveo into the Temenos group, TF Bank launched a revised study and
an advanced analysis of T24 functionality. The focus was on the syn-
ergy between the two solutions. Three months later, TF Bank chose T24

for its core banking solution, interfaced with existing V.bank modules. TF
Bank plans to complete its IT system with the online banking offering
from V.bank in order to create new portals for individuals and corporate
customers in France, Tunisia and elsewhere in Europe.
TEMENOS AML for Barclays
Barclays has chosen TEMENOS AML (AML) for its Payments
Consolidation and Next Generation (PCNG) screening solution. AML
was benchmarked against other market leading competitors and proved
to be the fastest and most operationally efficient offering. It will be de-
ployed globally to replace existing platforms and consolidate payments
and transactions screening.
As the solution of choice for Barclays, AML includes Linguistics, which
will enable the banks Next Generation Programme to achieve supe-
rior levels of screening. The application of Linguistics in Barclays is a
sophisticated solution to address the increasing challenges of cultural
variations and subtleties. This heightened detection capability is coupled
with industry leading intelligent false positive reduction methods from
Temenos, designed to drive down total cost of ownership and increase
operational efficiency.
Paul Fabara, Managing Director and Global Head of Operations,
Regulatory Implementation and Planning at Barclays, commented, After
a rigorous technical assessment of the leading sanctions screening solu-
tions available, the decision to select Temenos for the Barclays global
initiative was relatively easy. The banks approach to global compliance
is unequivocal we want to lead by example and have found the right
product to help us protect that position.
TEMENOS NEWS 13
An introduction to TEMENOS AML
New legislation has forced financial institutions to place
anti-money laundering (AML) at the heart of their business
and to incorporate prevention policies into their operational
management strategies. These obligations have increased the
need for banks to ensure they have effective AML procedures in
place. In response, TEMENOS AML (AML) has been developed to
provide a comprehensive business solution that offers banks the
software and expertise required to improve their approach to
anti-money laundering, and comply with all legal obligations.
There are two key products within AML:
AML Profile (Profile) is an anti-money laundering system that
monitors transactions in order to identify unusual patterns. It
analyses single transactions as well as clients behaviour over
a period of time in relation to their segmentation, facilitating
reporting to the authorities where appropriate. Using an elegant set
of algorithms, it provides great flexibility in defining rules adapted
to the banks business and client base. Profile receives client,
account and transaction data from T24 in batch mode. It is also
capable of real-time analysis in order to block transactions before
execution.
AML Screen (Screen) is a sophisticated screening solution.
Integrated into T24, it screens customers and transactions against
sanctions watch-lists published by regulatory authorities such as
OFAC, as well as databases of politically and financially exposed
persons, such as those maintained by independent list providers.
In its standard configuration, Screen provides watch-list
management, compliance case review and skip management. It
has preconfigured statutory reports in an ergonomic, optimised
user interface. In addition, a dedicated module helps banks run
periodic scans of their entire customer files.
Screen also exists as a packaged out-of-the box solution to meet
the needs of smaller financial institutions in combating terrorism
financing. This T24 module screens customers and transactions
against sanctions watch-lists and databases published by regulatory
authorities such as OFAC and the European Union.
An introduction to TEMENOS STeP payments repair
TEMENOS STeP payments repair is a tool that repairs and
enhances payment messages, in a variety of formats. It is
integrated with T24 for both inbound and outbound messages. In
addition to the engine, the system has two optional components:
Solver for operator-assisted repair and enrichment and Evaluation,
which generates reporting to support back-charging and
efficiency of STP rules.
14 TEMENOS NEWS
Banks need to offer a differentiated and highly personalised
service, centred on relationships, not products
Ben Robinson, Director, Strategic Planning, Temenos
ViewpoinT
Creating value for customers
What sets profitable banks apart? Ben Robinson examines the key factors that make a difference
The banking crisis is having profound
consequences for the industry: banks
have disappeared; balance sheets have
shrunk considerably; wholesale and credit
market funding has become more tightly
rationed; and liquidity in certain financial
markets has all but dried up. But there
are still more effects to come, especially
regarding government regulation.
In the developing world, rapidly growing
demand places different kinds of strain.
Consider China, for example: mass urbanisation
and a booming economy are creating
enormous demand for banking services,
putting pressure on banks systems and
processes. Moreover, the governments move
to internationalise and deregulate the market
is also intensifying competition, meaning that
coping with demand is not enough banks
also have to improve their customer service,
efficiency and risk management.
What is constant across all markets,
however, is that the best banks are already
reacting, adapting their practices to stay
ahead. Where these banks also run modern
software, they are responding faster and
more cheaply helping them to generate
higher returns than their competitors.
Becoming king again how Temenos
software helps to improve customer
service and innovation
In the developed world, shortage of funding is
forcing banks to shore up their deposit bases,
while also increasing the pressure to generate
high-quality assets and higher fees. In the
developing world, where wholesale funding
was never especially prevalent, competition
for deposits remains strong and is intensifying
as customers become more discerning,
governments deregulate and Western banks
come in search of faster growth and higher
returns. All in all, successful banks need to
offer a differentiated and highly personalised
service, centred on relationships, not products.
New market entrants, like BforBank (see case
study, page 16) in France and Metro Bank in
the UK, are using Temenos technology to help
them achieve this. BforBank, for instance, is
setting itself apart from peers through the
quality and volume of the information it
makes available empowering an increasingly
exacting, financially literate and technology
savvy public to become their own private
bankers. The quality of the user experience
offered, based on the provision of rich, value-
added and interactive content, is unmatched
except by vendors, like Amazon, outside of the
banking industry.
Established Temenos customers are also
using advanced technology to improve
their customer service. Techcombank,
the fastest growing bank in Vietnam, has
capitalised on the flexibility of T24 to
launch a stream of innovative products
helping it to grow deposits at more than
twice the rate of the overall market.
Leveraging scale economies how a
modern, integrated platform leads to
lower relative costs
Banks spend more than twice the industry
average on IT costs (source: Boston Consulting
Group). The general assumption, which has
sanctioned inaction, is that this reflects more
complex and sophisticated IT requirements.
This explanation justifies the lack of IT scale
economies achieved and the failure to extract
IT cost synergies from acquisitions.
Temenos customers, however, are invalidating
this assumption. EFG Bank, for example, has
an outstanding record of realising IT scale
economies. Since 1995, the bank has grown
extremely rapidly, increasing clients assets
under management (AuM) to CHF 87.7
billion as at end of 2009. EFG now employs
around 2,400 people in over 50 locations in
30 countries, and has absorbed over twenty
acquisitions. Yet it remains highly efficient in
terms of IT: at less than 6 per cent, its ratio
of IT to total costs is around one third the
average for European private banks.
Similarly, Bank of Shanghai (BOS) see
case study, page 11 is also enjoying the
significant scale advantages of adding more
volume and customers onto an integrated
platform. BOS is adding around 700,000 new
customers a year, yet the bank only employs
367 IT employees. We estimate the bank has
an IT to total operating cost ratio 60 per cent
below the industry average, while its overall
cost/income is 55 per cent below the average
for the top 1,000 banks and 15 per cent
below the average for domestic peers.
Seeing the whole picture how a single
view helps to manage risk
Diversification and disintermediation were
meant to mitigate risk; instead, they created
greater complexity that made risks even more
difficult to manage. While many activities
will likely be scaled back, the renewed focus
on robust risk management will remain.
Banks will need to write higher quality
business, which will require strong pricing
and underwriting skills and, more crucially, a
complete view of the customer.
T24 customers have been taking advantage
of this complete view of risk to manage
and price risk effectively. Techcombank, for
example, grew gross loans by 199 per cent
between 2006 and 2008 around 30 per
cent faster than the overall market but its
level of non-performing loans actually fell
to 2.56 per cent.

We believe that a process orientation, coupled with technology,
is starting to redefine operating models
Gareth Jones, Retail Business Development Director, Temenos
ViewpoinT
The rise of dematerialisation:
Cost Reduction 2.0
Banks can manage costs by implementing dematerialisation, says Gareth Jones
Dematerialisation is essentially doing more
with less and we are seeing it increasingly in
the banking sector. In the last two years, 5.5
trillion dollars has been wiped off capitalisation
of the global banking sector (a fall to 60 per
cent of peak levels). Many of the gains made
to key performance indicators pre-crisis have
suffered set-backs: Boston Consulting Groups
global banking database indicates global rises in
cost/income ratios, falling return on assets and
soaring loan loss provisions. There is increasing
pressure to quickly reinstate improvements
that had taken the best part of this decade to
realise. If anything, the outlook is even more
challenging; if regulators demand higher Tier 1
capital requirements, this will further squeeze
return on equity, without improved efficiency
measures to offset the impact.
Many banks have implemented cost-cutting
measures in the last year or so, often involving
staffing cuts. However, there is evidence that
reducing staff without aligned improvements
in operational processes is having a negative
impact on customer satisfaction, with
potentially adverse financial consequences in
the longer term.
The next wave will be a more calculated and
measured approach, but there are significant
gains to be achieved. Smart banks will use
these levers to pull away from the crowd.
Not surprisingly, most of the areas with the
biggest potential require the exploitation of
technology, or demand a re-think on how
technology is being used.
The elimination of waste from banking
processes has more mileage. Techniques
such as Lean/Six Sigma can play a role here.
Discipline is needed to be able to measure
and determine sustainable savings and
improvements at the same time. Yet equally
important is an underlying technology
infrastructure that can support the re-
configuration of the business. Where the
technology actually embodies a process
model, it is easier to achieve optimisation of
these processes and improve continuously.
At Temenos for example, we are finding that
our T24 Process Models, and the services
offered by our Management Consulting
Practice and our partners around these, are
increasingly resonating with clients. After all, if
processes are documented, they can easily be
challenged. If processes are implemented, they
can continuously be refined.
Focusing on optimisation of existing value
chains is important, but one of the major
criticisms of methods such as Six Sigma is
that they do not do enough to help invent
or disrupt the future through new products
and services, for example. We believe that a
process orientation, coupled with technology,
is starting to redefine operating models. For
example, banks can rightly claim to not be
fully responsible for potential inefficiency
or waste related to the authentication and
verification process during new customer
acquisition. Current models (and regulators)
usually disrupt what could be a straight-
through process by insisting that potential
clients provide physical proof of ID. This
either involves inconvenience through a
visit to a branch or delay and concern if the
original documents are posted to a service
centre for processing. However, regulator-
friendly services are emerging that verify the
individual electronically.
This is game-changing for internet customer
acquisition, but the real trick will be to
extend this to the branch where arguably
TEMENOS NEWS 15
it is not needed since clients can present
documents as they have done for years.
Now we have common processes re-used
across channels, along with greater customer
convenience, and a slicker fulfilment process.
This can start to redefine the role of branches
an area where the debate is still raging
as to what purpose precisely the customer
of the future will use them for. Business
re-engineering of this nature will give some
institutions a huge advantage.
Dematerialisation is also a growing trend
within the IT function. We are seeing
increased focus on addressing the IT cost
base, and arguably this is long overdue.
Research confirms that banking has higher
IT costs as a percentage of total costs
than practically any other industry. One
reason that might explain this disparity
is that banks have been slower to adopt
commercially available packages and
components to the same extent as other
industries. This is now changing and there
is a growing trend (among the bigger
banks especially) towards the adoption of
package applications.
Appropriate technology platform choice can
offer significant cost reduction over time.
This is true of hardware, and increasingly of
core systems too. Core system replacement
is a major undertaking, but for many
institutions this may be the next big move to
dematerialise the organisation.
Dematerialisation presents a final challenge
the likelihood that significant investment
will be needed to effect a sustainable change
in the cost base. Yet this investment, carefully
calculated, will lead some institutions to the
head of the pack.
16 TEMENOS NEWS
What really convinced BforBank was the flexibility and international
nature of the Temenos system, as well as its wide coverage of front
and back office functions
Vincent Chatard, COO, BforBank, Credit Agricole Group
case study
BforBank
BforBank harnesses T24 for affluent online market
There has long been a demand for high
quality online banking that meets the
needs of the demanding affluent mar-
ket. BforBank is providing this special-
ised service to high-end customers in
France, and its banking engine is T24
from Temenos.
An internet bank aimed at the affluent,
BforBank offers savings accounts, life insurance
and securities. The bank targets customers such
as directors, doctors and professionals aged
between 35 and 65 who want to manage their
own money. Part of the domestic retail arm of
Credit Agricole, BforBank is a business in its own
right, with specific objectives and mission.
BforBank attracts customers by offering
access to a comprehensive, free repository
of financial information on its website. The
journey within the website involves a series of
links, encouraging visitors to navigate through
the website. Relevant approved products
are recommended in ways that encourage
interaction. Customers can use the tools on
the site, including calculators and walk-
though illustrations, to customise their own
investment style.
The BforBank website, built in 2009, harnesses
user-generated content and is a repository of
rich information, designed for interaction and
engagement. It enables the bank to process
stores of data into digestible, actionable
intelligence for consumers.
The system uses customer data to recommend
appropriate products and manage upselling, and
can offer a member incentive programme for
referrals. The lean technology base and industry
tools ensure a low cost base.
Information is free to browse and all interactive
features are free to use. Visitors must register
to save any output from simulations, thus
providing detailed customer information,
which the bank can use to provide them
with appropriate products. T24 pre-allocates
accounts, so that when a customer opens an
account all the necessary information is in the
system. As a result, the bank can open accounts
very quickly as there is no replication of data.
BforBank chose T24 as the main database to
handle accounting, customer files, regulatory
reporting, prospects and products. The banks
customer advisors benefit from having all data
residing in one location to help them deal with
queries quickly and fully. T24 sits on servers
owned by the Credit Agricole group.
A major strength of the BforBank approach
is the real-time system that T24 provides for
the bank. This allows for ease of integration
through open solutions, data and services in
XML, says Vincent Chatard, COO, BforBank,
Credit Agricole Group. What really convinced
BforBank was the fle xibility and international
nature of the Temenos system, as well as
its wide coverage of front and back office
functions.
With the aim of being the first true internet
personal bank, BforBank offers its customers
the quality of information and range of tools
available to financial advisors, so that they
can become their own private bankers. The
banks slogan, Mon banquier cest moi (My
banker is me), reflects the empowerment
of individuals to handle their own financial
affairs. Customers input their own data and can
manage their accounts, make comparisons, and
access calculators and tax reports. Deposits are
invested with Credit Agricole, which primarily
handles investment in low-risk, AAA rated
securities.
As the only international vendor that BforBank
considered, Temenos won the contract in the
face of competition from French core banking
vendors, Viveo (now acquired by Temenos) and
SAB. The project started in February 2009 and
Temenos supplied the system in July and after
trials, it went live in October 2009.
Temenos key differentiators against
international competitors were its presence
in France and the flexibility and scalability of
T24 set it apart from local solutions. BforBank
targets an addressable market of four million
affluent customers with a savings balance of
EUR30,000 or more. Having opened 15, 000
accounts in less than three months, the bank
has set a goal of 40,000 accounts per year,
which over five years would allow for a market
share of around 7 per cent.
 TEMENOS NEWS 17

Were looking to drive out operational slack and improve

customer service, and what we saw with Temenos was a
maturity of straight-through processing
Fred Cook, NSCU chief information officer

case study

North Shore Credit Union

Changing a financial services platform is a highly complex process.
North Shore Credit Unions choice of T24 has enabled a smooth transition

Founded more than six decades ago,
Vancouver-based North Shore Credit
Union (NSCU) has built a strong repu-
tation for customer-centred innova-
tion. Offering a wide range of banking,
investment, loan and insurance solu-
tions, NSCU employs some of the most
knowledgeable financial advisers in the
Canadian market.
When NSCUs banking platform faced
integration difficulties and problems with
inflexibility, the credit union began to search
for a solution. The first issue that had to be
resolved was architectural compatibility, says
NSCU Chief Information Officer Fred Cook,
who manages strategic integration and risk
analysis of NSCUs technology systems. We
needed a system that would fit in with and
leverage our other systems, especially our
CRM and ECM systems and our BI engine, as
well as our business processes.
Since NSCUs core enterprise environment is
based on Microsoft Windows and SQL Server,
any solution also had to work smoothly with
those technologies. TEMENOS T24 (T24)
stood out from other available options for its
ability to meet all of these diverse demands.
NSCU became the first Canadian customer
to adopt the T24 system, becoming one of
around 700 banks around the world that
use T24 to deliver innovative, market-driven
products and services.
Temenos has a strong culture of
continuous improvement, with a history of
R&D and development of their products to
keep moving forward, says Cook. Were
looking to drive out operational slack and
improve customer service, and what we saw
with Temenos was a maturity of straight-
through processing.
The partnership between Temenos and
Microsoft was also an important motivator in
NSCUs choice of provider, adds Cook. We feel
that Microsoft and Temenos have gone to the
next level with their recent strategy agreement,
opening up a core Windows-based SQL banking
system to a wider banking environment.
Temenos in turn was impressed with NSCUs
track record, says Adrian Hadley, retail banking
product manager at Temenos. We recognised
that although NSCU is a relatively small
institution, they are forward thinking and
customer focused, with a uniquely flexible
approach to customer service that allows their
members to customise their accounts to meet
their own unique circumstances. This fosters
huge brand loyalty and delivers high customer
retention and cross-sell rates.
The T24 solution appealed to NSCU because
of its simple design: everything runs on a
common architecture with a customer centric,
browser-based user interface. For NSCU, this
approach was particularly attractive because it
would allow the organisation to meet its goal
of maintaining a highly compact technology
footprint.
Temenoss T24 Arrangement Architecture
allows for a componetised approach to product
creation and servicing which provides NSCU
with a flexible catalogue that can bring new
products to market very quickly. There is the
option to mix and match components to create
new products, adding more components to the
catalogue along the way.
NSCUs members will feel the benefits of on the deposit and current account sides in
this flexible architecture in the form of a
wider range of services, segmented and
targeted products and more detailed financial
statements. The enhanced cross-platform
integration of the T24/SQL solution will allow
NSCU to streamline business activities, reduce
business cycles and cut operating overheads by
automating back-end processes.
An important target of the project was to
replace existing functionality, introducing new
elements only where it made business process
sense and could be done quickly. NSCU was
determined to keep scope creep to a minimum.
T24s sturdy business process and governance
capabilities enabled NSCU to enforce business
rules, which was not the case with the old
system. The credit union also leveraged the
T24-SQL Server platform by integrating the
Syntellect Communications Portal to provide a
solid base for communications.
Temenos developed a banking model
specifically for Canada, which has a robust
tax shelter product mix and an approach
to mortgage products that differs from
that found in many other countries. Our
Model Bank is the accumulation of many
years of experience and more than 700
implementations, says Hadley. Weve put
a distillation of best practice processes and
user interfaces into the Model Bank. Our
clients can hit the ground running with a
preconfigured installation.
NSCU has started to see the benefits from
its implementation of T24 with the platform
now installed on the lending side of the
business. Temenos is continuing to expand
the Arrangement Architecture internally and
there are plans to drive more products out
the coming months. Cook comments: We
regard Temenos as the next generation of retail
banking that will give us the competitive edge
in the marketplace.
18 TEMENOS NEWS

Effective partnerships are one of Temenos greatest strengths, underpinned by

our commitment to open solutions, and our alignment with the three major
technology stacks

A partnership approach
This is the time of year when Temenos, our clients and our part-
ners gather at the Temenos Community Forum (TCF) to review
and plan for the opportunities ahead.
At Temenos we understand that our clients can derive more benefit
from our products if they are efficiently aligned to the services and
products from our partners. This article will look at those partners
that provide the platform technology that is needed to operate an
efficient and modern banking system. Effective partnerships are
one of Temenos greatest strengths and are underpinned by our
commitment to open solutions, and our alignment with the three
major technology stacks in the market. Id like to explain how these
essential elements work together for the benefit of our customers.
Why do we have an open systems strategy? We believe that it
is essential that we do not restrict the choices available to our
clients. Partners enable us to offer our software on a wider range
of technology platforms than any other core banking vendor. This
is important in that we do not dictate any particular technology,
but leave the choice to customers enabling them to achieve the
lowest total cost of ownership (TCO) or to leverage existing skills,
investments or vendor relationships in order to achieve the highest
possible return on investment. When you consider that our diverse
client base includes both smaller microfinance institutions and
larger multinational banks, then it becomes immediately obvious
that technology requirements will differ greatly.
We partner with a variety of different types of organisations in order
to offer the fullest possible service and options to our clients. Our
services partners, such as Cognizant, allow Temenos to offer custom-
ers more choice over which advisors they use and give them access to
world-class business management and product delivery skills. In order
to become a Temenos certified service partner, organisations must
commit to training significant numbers of consultants as well as com-
mitting to use the established methodology for implementing our
software thereby combining these organisations expertise with the
proven products, methodologies and tools that Temenos offers.
mark gunning,
global director,
banking services,
Temenos
However a commitment to openness does not mean that we can
remain unaligned to those technologies that are most beneficial
and most popular with our clients. This is particularly true in the
area of databases, application servers and operating systems where
we have worked closely with our partners to ensure that T24
exploits the capabilities of the chosen platform to reduce cost and
improve performance for our clients. In practice this means that
we align our products with the three industry leading technology
stacks; those from IBM, Microsoft and Oracle. We also have par-
ticularly strong relationships with those partners that provide the
underlying hardware on which our solutions run, most importantly
with Hewlett Packard.
The theme of this years TCF is Innovation, service and efficiency
the route to profit. We show our commitment to innovation by
remaining an open solution whilst having clearly aligned partner-
ships. Our clients can benefit from both the innovation and service
that both we and our partners provide. Clients get all the invest-
ment that Temenos makes into the product, along with the flex-
ibility that allows them to innovate and they can get exactly the
same benefits and flexibility from whichever platform they choose.
The end result is efficiency and profit.
Temenos Community Forum 2009, in Monaco

Core banking systems represent substantial investments in time and

effort and for these reasons they are built for the long haul, with
most core systems supporting their banks for at least 10 years and
some lasting up to 30. Open systems provide the necessary flex-
ibility to deliver the best solutions to our clients today and into the
future. It means that as particular technologies adapt, evolve or are
replaced we are in a position to help clients transition to the new
technologies with the lowest possible effort and risk.
FOR THE BANKING, FINANCIAL SERVICES AND INSURANCE SECTOR

Get more from your

Temenos investments
At Cognizant we ensure you get the most from your
Temenos investments. As the first and only Global Strategic SI
partner, Cognizant have invested heavily in building a dedicated
T24 skilled associates workforce and global T24 Centre of
Excellence, giving us the competitive edge to deliver
accelerated time-to-market, reduced TCO, increased IT
flexibility and enhanced ROI.

This unique partnership together with our

depth of capabilities, proven domain-led
delivery experience, combined with quality
and cost-effective solutions, means we are
the business partner of choice for banks
worldwide for:
Business Process Consulting
Implementations
Upgrades
Legacy Data Migration
Testing
Global Delivery & Support

Cognizant, one of the top 20 Global

Financial Technology Providers

VISIT COGNIZANT AT STAND PLATINUM 01 AT TEMENOS

COMMUNITY FORUM 2010 WHERE YOU CAN:
Have a 1-2-1 meeting with a Cognizant
consultant, email temenos@cognizant-event.co.uk
today to RESERVE A TIME THAT SUITS YOU
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the most
profitable banks
run TemenoS
62% higher return on capital

54% higher return on assets

7.2 points lower cost/income

The data for this analysis comes from The Banker - Top 1000 banks 2009. Average values for Temenos customers compared with average values for all other banks.

For more information on Temenos or to understand how its market-

leading software helps banks all over the world to outperform,
please visit www.temenos.com/profit
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www.temenos.com Telephone: +41 22 708 1150 | Fax: +41 22 708 1160 | Email: profit@temenos.com
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