Idg banking vietnam2010 customercentricplatform-100527-l-tay-v07

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Evolving A Customer Centric Platform For Vietnamese Banks Trends AND Strategies From Across The World

Lance TaySenior Director, Financial Services Global Business Unit

Hanoi, 27 May 2010

© 2010 Oracle Corporation – Proprietary and ConfidentialBankingVN-CustCentricPlatform-100527-LTay-v07

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• Global Trends Banking

• Customer Centric Platform Strategies

• Roadmap for Success

• Oracle Value Proposition

Agenda


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Challenges in Financial Services2nd global banking crisis? “W” or “L” shaped recovery?

• Continued economic uncertainty

• Increasing risk and regulatory requirements

• Intensified competitive innovation

• Less tolerance for slow restructuring and post-merger benefits realization

• Increasing customer dissatisfaction

• Greece/EU debt crisis, China property bubble

• Basel 3, ICAAP, SEPA end-date

• USAA1 enables mobile-phone photo-capture check deposit

• Gartner 2 predicts 50% of post-merger integrations will fail

• Accelerated customer defection

Financial Institutions Needs To Be Even More Nimble

Spend less to get more

Respond “immediately” to competition

Extract value faster

Serve to sell

CHALLENGES IMPERATIVES

1. Bank Systems & Technology, Conz, 26 Jun 2009

2. Gartner, Moyer, 23 Jan 2009


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Grow Business & Cross-Sell to

Customers

“How can I streamline my business processes to grow wallet share and shorten time to market for new products a nd services?”

“The average cost to acquire a new customer is $3,500 in the US” American Bankers Association

Compliance & Regulatory Pressures

“How can my organization meet the increasing regulatory compliance demands?”

“IT spend on compliance will grow annually at 14.1% and reach $3.0 billion by 2006” The Info Shop

Scale Costs to Match Market Opportunity

“How can I improve cost efficiency ratios while pro viding greater value to our customers?”

“In the near to intermediate term, the industry is expected to continue to experience pressures on its net interest margin”AM Best

The Challenges We’re Hearing


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The Customer Centric Platform ChallengeRetain, Acquire and Cross-Sell Customers, Product I nnovation

Grow Business & Cross-Sell to

Customers

“How can I streamline my business processes to grow wallet share and shorten time to market for new products a nd services?”

Forrester Trends : Retail Financial Services


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Agenda


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Customer Centric Platform StrategiesMeeting Customer Expectations

Top 3 successful business strategies

Critical for fast growing economies such as Vietnam

1. Delivery Channels– Beyond traditional branch

and ATM channels2. Products Innovation

– Blended deposit, loan, payment, investment and corporate offering

3. Customer Relationship Management– Integrating service with

sales, and core banking


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1. Delivery ChannelsDirect banking channels enablement is key

• Wider reach – 60% prefers to transact over the inter net• Lowest cost to serve – 10cents per transaction over mobile

Source: 2007 McKinsey survey of personal financial services in Vietnam


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Vietnam Direct Banking PotentialMobile banking channel emerging dominance

• 30m+ mobile subscribers

Internet Usage

0

5,000

10,000

15,000

20,000

25,000

2003 2004 2005 2006 2007 2008

Year

Use

rs in

000

s

Mobile Subscribers

0

5000

10000

15000

20000

25000

2001 2002 2003 2004 2005 2006 2007

YearS

ubsc

riber

s in

000

s

Source: VNNIC Source: ICT Statistics / International Telecommunication Union


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2. Product InnovationIncrease agility - break-out from legacy core bankin g constraints

Legacy Core Banking Systems Limitations

• Closed platform• Hardcoded offerings and processes -

Difficult to create new product variations and new products

• Predominance of aging legacy systems requires companies to spend between 65% and 80% of IT spend on system maintenance and steady state operations

• Siloed infrastructure (often mirroring organization) creates redundant credit, deposit, lending and trading applications and data environments

Modern Core Banking Solutions

• Open platform• Incorporating latest

products and service offerings in single “core”

• Easy product reconfiguration - mix & match products to create new offerings

• Process driven solutions

• Lower cost maintenance


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Modern Core Banking – Enable Consistent and Superior Customer ExperienceFrom a product centric to a customer centric busine ss model


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6 Servicing & Transacting

• Customer maintenance

• Contract/account maintenance

• Financial transactions

• Payments & collections

• Customer escalations & claims

1 Concept Creation

• Customer insight

• Product & market analytics

• Product and usage reporting

• Marketing/Segmentation analysis

• Concept refinement

2 Product Design & Planning

• Product characteristics

• Product details

• Product pricing

• Product bundling

• Product risk assessment

• Product delivery vehicle(s)

3 Product Creation

• Product sourcing

• Delivery vehicle setup/activation

• Collateral/marketing materials creation

• Docs, processes, employee training

4 CampaignManagement

• Integrated marketing

• Discounting and promotions

• Sales execution

• Real-time offer generation

• Campaign effectiveness

5 Account Origination / New Business

• Product selection

• Application capture

• Decisioning

• Orchestrated fulfillment

• Contract/account creation

• Discounts and promotions

• Real-time up sell/cross sell

3. Customer Relationship ManagementDelivering service to win and retain profitable cus tomers

Acquisition, On-boarding,

Retention


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The Evolution of CRM – From Mid to Front Office

EngageAnalyze

1990’s 2000’s 2010’s

Transact


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Agenda


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Roadmap for Success3-Stage Recommendation For Vietnam

1. Implement a scalable direct banking solution

2. Install a modern core banking solution

3. Undertake a comprehensive CRM solution

• Reach out to rapidly expanding market

• Rapidly offer new products wanted by customers

• Capture and retain profitable customers


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1. Oracle FLEXCUBE Direct BankingScalable internet and mobile banking solution – out of the box

SMS

• Offer advanced services on mobile communication devices

• Expand business across geographies • Address fraud and mitigate phishing

risks • Rollout your 'Gen Y' strategies

effectively • Lower customer acquisition and

servicing costs • Offer benchmark internet banking and

mobile banking services

• Support for multiple delivery channels, with a wide range of functionality. This includes banking, bill payment and presentment, online statements, account registers, alerts, personalization, account aggregation, and one-to-one marketing

Any Core Banking Systems

Any Consumer Device


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FLEXCUBE Direct Banking - True ‘Anywhere, Anytime’

• Available across range of devices – Mobile Phones, PDAs, Smart Phones (iPhone, WindowsMobile, Symbian)

• GPRS, EDGE, WiFi• Supports mobile banking

through– SMS

– Browser based (WAP 2.0, i-mode)– Downloadable Java applications

• Secure end-to-end transaction• User Interface managed by

application to suit individual devices


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FLEXCUBE Direct Banking (FCDB) – Application MapPre-built functional solutions, templates, and core integration

Other Systems

Delivery Channel

Internet PDA Mobile

Retail Banking

Current & Savings Accounts

Term Deposits Loans Transfers & Payments

Bill Payment Standing Orders Customer Services Credit Cards

Corporate Banking

Current & Savings Account

Term Deposits Loans Cash Management

Bulk Payments Trade Finance Customer Services Authorization Mandates

Investor Services

MF Portfolio View MF Buy / Sell MF Switch / Redeem Customer Services

Core Services

Administration Authentication Entitlements Multi Entity

Multi Branding Multi Lingual Multi Currency Security

Integration Layers

Online/ Batch

Store & Forward

Orchestration

Message Translation

Business Services Integration

Synchronization

Standardised XML Interfaces

ASCII, ISO 8583

Message Queues, Web Services, TCP/IP,

EJB

Backend Systems

Retail Banking

Corporate Banking

Other Legacy Systems

Credit Card System

CRM

ERP

Security (Tokens, PKI, Adaptive)

Mobile Gateway

Reporting


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Monthly accounts Change in balanceTop page after login

Screen change by clicking a tab

Banking expression “naturally” expected by mobile phone users

Deposit/withdrawal details

FCDB Case Study - Jibun Bankbook (Japan)Jibun Bank – JV of KDDI and Bank of Tokyo-Mitsubishi UFJ

Case Study

Jibun Bank Wins Awards for

Innovation & Quality

• Asian Banker Summit Award

(2009)

• Celent – Mobile Banking (2010)

Jibun Bank Wins Awards for

Innovation & Quality

• Asian Banker Summit Award

(2009)

• Celent – Mobile Banking (2010)


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Jibun Bankbook page before opening an account

Easy quick account-opening process whenever & wherever

Enter personal information

Use the built-in camera to photograph the driver’s license and send it directly

Within a week, a cash card will be sent to home to complete the account-opening process.

Data entry is minimized by using the existing subscriber information already registered for the mobile phone.

It takes only 10-15 minutes up to this point

Jibun Bankbook - Quick Account-OpeningCase Study


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Transfer process is completed, just like sending an email.

Select a recipient from the address book Enter an amount/message Transfer completed

*The recipient receives a notification email when the money is transferred into their account.

Jibun Bankbook - Money Transfer Using A Mobile Phone Number

Case Study


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2. Oracle Flexcube Core Banking SolutionsProven in VN, and designed for future-proofing

KEY FEATURES & BENEFITS• Vietnam market pre-packaged customization• Engage distribution partners • Streamline mortgage processing • Enhance lending and leasing • Standardize origination • Achieve economies of scale by centralizing

trade finance operations in regional hubs • SWIFT ready payments with support for SEPA • Support innovative business models • Gain better analytical and operational insight,

manage compliance • Adapt and transform faster • Improve inventory management • Address change for business needs

SOLUTIONS• Retail

Banking• Corporate

Banking• Leasing / HP• Islamic

Banking


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FLEXCUBE Universal Banking – Functional Arch.BPEL & SOA Foundation


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Siebel CRM Oracle Social CRMOracle CRM On Demand

3. Oracle CRM Solutions – Complete CRMTransact, analyze, and engage

Integration (AIA)


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Siebel 8 – Enterprise-class FSI CRM

• Task-Based User Interface

• Haley Rules Engine Integration

• Advanced Sales Forecasting• Improved Territory Management

• PRM Contract Enhancements

• SOA: Partner Registration

Sales Marketing

• New Strategic Marketing Initiatives

• Enhanced Budgeting and Financial Management

• New Marketing Collateral and Asset Inventory Management

• Enhanced Loyalty Management Capabilities

• SOA: Personalized Web Offers, Response Creation, Event Management

Master Data Management

• Universal Data Quality Integration

• Enhanced Data matching

• Privacy Management

• SOA: CDI Data access

• SOA: Catalog/Configurator

• SOA: Shopping Cart services

• Procedural Condition support

Customer Order Mgt

• Customer Facing Web Services

• Advanced Bill Presentment, Payment & Analytics Capabilities

• Versioned Hierarchy

• Advanced Search for eService

• SOA: Asset Registration

Self-Service

• Managed Services support

• Enhanced Store-and-Forward Messaging

• SOA: Inventory Transactions, Entitlement Checks, Asset and Warranty Registration

Service


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3+2+1 = CRM, Core Banking, and Channels IntegrationEvolving A Customer Centric Platform

Cust Channels

CRM


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Agenda


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Oracle in Banking

15 of the Top 20 Global banks use Oracle Applications to measure and manage their performance***

10 of the top 10 Global banks use OracleApplications to run their business*

23 of the Top 25 North American banksuse Oracle Applications to run their business**

Did You Know?

* Onesource Public Parent Commercial Banks

* *Based on the annual ranking by Tier 1 Capital performed by the Banker Magazine July 2004; Includes Financial, Human Capital and Customer Management Applications

*** Based on 2006 Banker’s Almanac Ranking

* Onesource Public Parent Commercial Banks

* *Based on the annual ranking by Tier 1 Capital performed by the Banker Magazine July 2004; Includes Financial, Human Capital and Customer Management Applications

*** Based on 2006 Banker’s Almanac Ranking


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More Value, Less Complexity

More Flexibility, Less Cost

More Choice,

Less Risk

Oracle’s Strategy

Standards-Based Architecture

OpenOpen


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Oracle + SunComplete, Open, Integrated Systems

Integrated ApproachComplete, Integrated Product Stack

Business Benefits� Higher Quality of Service

� Innovation Delivered Faster� Better Performance, Reliability,

Security� Lower Cost

� Reduced Complexity� Single Point of Support Contact

� Easier to Manage� Certified Configurations


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OracleOracle

ISV Partners

Corporate Administration

Customer Analytics

ChannelAnalytics

Marketing Analytics

Exec Analytics

Funds TransferPricing

Portal & Dashboards

Business ActivityMonitoring

Business ProcessAnalytics

Op Intelligence

HR Analytics

CustomerInsight

Performance Management

OperationalExcellence

AnalyticsPlatform

Consolidation Budgeting

Procurement

Profitability Mgmt

Fixed Assets

Incentive Comp

Product Hub Org Hierarchy Hub Accounting Hub Payments Hub

Master Data ManagementCustomer Data Hub

Rich Client F/WAJAX, Web 2.0

Systems Mgmt Web Services MgmtDirectory Services

Enterprise Content Mgmt

Database (Grid,Memory, Embed)

Web ServicesOrchestration (BPEL)

Identity Mgmt

J2EE Services, ESB and Rules Engine

Access Mgmt

Enterprise Technology

ProfitabilityAnalytics/RAPM

ACH

Credit Rating

POS

SWIFT

Fed Wire

OFAC

Market Feeds

Check Order

OtherSystems

Retail

Platform Teller Call Center

InternetBanking Kiosk EBPP

Private Wealth MgmtCommercial

SecurityTrading

DerivativePricing

CRM &Marketing

LeadMgmt

FinancialPlanning

Order EntryPlatform

On Demand

Customer Experience

Call Center

Deposits

Loans

Payments

Cards(Credit / Debit)Investments

Leasing

Payments

Deposits

TreasuryTradeFinance

AssetMgmt

SyndicatedLoans

StructuredDerivatives

Lock BoxNostroRecon

InvestorServices

Leasing Custody

Mortgages

Customer &BusinessInsight

Customer &BusinessInsight

Lifecycle ManagementSellingMarketing ServicingOriginating

External InterfacesExternal Interfaces

Projects

Risk Based Pricing

EconomicCapital/RAPM

Operational Risk

Market Risk

Credit Risk

ALM

SOX

RegulatoryReporting

Risk Based Decisioning

Risk Management

Governance, Risk & Compliance

Governance, Risk & Compliance

Compliance

BASEL II& 1A

AML

Human Capital Mgmt

Enterprise GL

CashMgmt

Real Estate

Savings Loans

Core BankingLedger

Reconcil-iation

Compliance& Limits

IntegrationMkt Data

PortfolioMgmt

TradeProcessing

Performance Mgmt

Balance & Positions

Fees & Commissions

Compensation

Clearing &Settlement

Core BankingLedger

TeamSelling

OrderMgmt

InternetBanking

ClientServicing

Product and Transaction Processors

Oracle’s Banking Footprint


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INDEPENDENT SOFTWARE VENDORS

Open Text CorpEudraVigilance

Winthrop StewartMS ProjectsEmerson Process Management

Werum Software & SystemsModel N, Inc.DrugLogic, Inc.

Trillium SoftwareMicroStrategyDocumentum

TacticianMcKesson HBOCCyclone Commerce

Synygy, Inc.ManugisticsCRF Health

SteeprockManhattan Associates

Concur

SpotfireLabwareCognos

Skura CorporationKronosIncorporatedClinphone Group Ltd.

SiperianinvivodataClickCommerce

SiemensGE FanucCitect

SAS InstituteFranklin GroupCamstar Systems, Inc.

RockwellInvensys SystemsCallidus Software Inc.

RelsysIntegicBusiness Objects SA

ProscapeIMS Health Inc.Aspentech

Premenos"Templar"I-Many Inc.ArisGlobal

PHT Corp.Image SolutionsAegis Analytical

PavilionTechnologiesHoneywell POMSADP

OSIsoft, Inc.GelcoActivplant

Global and Local Partners

GLOBAL SYSTEM INTEGRATORS


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Oracle’s Differentiated Value Proposition


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Summary

• Banking continues to develop and grow rapidly• Banks in Vietnam need to implement a customer

centric platform– Direct Banking

– Product Innovation

– Customer Relationship Management

• Oracle’s solutions enable competitive advantage– Only multi-channel sales, service, marketing and transaction

solution pre-integrated with core banking

– Only open standards core banking solution enabling new products, relationship pricing & consolidation of existing systems

– Only service-oriented architecture with a banking-specific data model and process library


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The preceding is intended to outline our general product direction. It is intended for information purposes only, and may not be incorporated into any contract. It is not a commitment to deliver any material, code, or functionality, and should not be relied upon in making purchasing decisions.The development, release, and timing of any features or functionality described for Oracle’s products remains at the sole discretion of Oracle.


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Server & Storage SystemsServer & Storage SystemsServer & Storage Systems

ApplicationsApplications MiddlewareMiddleware DatabaseDatabase

Oracle’s Product Families


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Lance TaySenior Director, Financial Services Global Business Unit [email protected]

• Lance Tay is the Senior Director for Banking across Asia Pacific in Oracle’s Financial Services Global Business Unit (FSGBU).

• In this role, Lance is responsible for providing de ep domain expertise to Oracle’s financial services customers across all of Oracle’s applications and technology products. Lance brings to this role a wealth of exp erience and valuable insight gained through over fifteen years of experience working wi th some of the region’s largest financial services companies. His domain expertise includes retail banking, wealth management, and trade finance. Lance has worked wit h major financial institutions in Australia, New Zealand, South East Asia, India, Chi na, and S. Korea.

• Lance is considered a retail banking IT strategy th ought leader within the financial services sector and is a regular commentator in lea ding industry publications. He is often invited to speak at industry seminars about b reakthroughs in banking IT strategy.

• Prior to joining Oracle, Lance held management posi tions at The Boston Consulting Group, Accenture, and Cisco Systems. Lance also wo rked at Fidelity-NIS, and Procter & Gamble.

• Lance holds a MBA from Cornell University, and a Ba chelor of Science from the Southern University of New Hampshire. He has also lived in Sydney, Bangkok, Mumbai, and Geneva.


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Idg banking vietnam2010 customercentricplatform-100527-l-tay-v07

Business

oracle corporation proprietary

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product centric

new product products

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retail financial services