Oracle erf overview v4

Enterprise Risk & FinanceIndustry Solution

Version 4

© 2011 Oracle Corporation – Proprietary and Confidential

Stuart Houston

Vice President, Financial Services Industry Business Unit

© 2011 Oracle Corporation – Proprietary and Confidential

Enterprise Risk and FinanceDefinition

The integration of traditional accounting and financial management, financial performance and control, risk management and compliance and reporting functions on a common decisioning platform.

Enterprise Risk and Finance (Solution Set)

Finance Modernization (Sales Play)

• Operational Finance• Performance Mgt• Integrated ERP & Analytics

EPM

ERP GBU

Risk Adjusted Performance Management(Sales Play)

• Profitability & Performance Management

• Planning & Forecasting (incl. B/S)

EPM

APPS

GBU

Enterprise Risk & Capital Adequacy

(Sales Play)

• Liquidity/Basel III & IRR• Capital Adequacy - Basel II,

Economic Capital• Operational Risk

GBU

Tech

Agile Financial Services Analytics

(FS Data Management Sales Play)

• Data Warehouse• Banking Analytics

Transformation

GBU

EPM

FSI Solutions – Enterprise Risk & FinanceSales Plays

ERP Tech

Financial Services IBU Solution SetsEnterprise Risk and Finance

Enterprise Risk and Finance

Finance Modernization

Accounting Modernization

Financial Close & Reporting

IFRS Compliance

in FS

Risk Adjusted Performance

Mgmt

Profitability Management

Risk Adjusted Performance

Planning and Strategy

Optimization

Enterprise Risk & Capital Adequacy

Basel III - Capital

Adequacy

Liquidity Risk Management

Interest Rate Risk

Management

Financial Crimes & Compliance

Agile Financial Services Analytics

Finance & Risk Data Warehouse

World Class Business

Intelligence

Sal

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Pla

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Set

• Accounting Centralization and Compliance• General Ledger Consolidation• Financial Close Management• Reporting and Analytical Transparency• Disclosure Analytics• Data Management and Control

Focus AreaFinance Modernization

Delivering Visibility, Efficiency and Control to the

operational finance process in a highly Automated manner, allowing the Finance

Organization to Focus on higher

value partnerships with the business

• Multidimensional Profitability• Unit Cost Development• Funds Transfer Pricing• Economic Capital Attribution• Management Reporting and Analytics• Planning and Forecasting

Focus AreaRisk Adjusted Performance Management

Enable Complete and Comprehensive

Insight into Performance and

Profitability. Deliver key business

measures Enterprise Wide to make better business decisions

• Regulatory Capital Compliance• Market, Credit, Operational Risk• Stress Testing and ICAAP• Liquidity and Interest Rate Risk• Risk Reporting and Analytics• Financial Crime and Compliance

Focus AreaEnterprise Risk and Capital Adequacy

Enable a Holistic View of Risk and

Compliance leading to Superior Decision

making, Unifying Risk Identification,

Quantification, Stress Testing and Capital Planning

processes across the Enterprise.

Enterprise Risk and FinanceIndustry Best Practices Architecture

Accounting and Finance

Performance and Risk

AccountingHub

General Ledger(THICK)

Accounting Rules

GeneralLedger

General Ledger(THIN)

Daily Average Balance

Close/Capital Mgmt

Consolidation

Plan & Forecast

Close & Disclosures

Data Staging Risk & Performance

Results Area

Account & Customer

Mgmt Ledger

Transactions

Enterprise Performance Management

Enterprise Risk

Management

Performance

Risk

Source Transactions

Intelligence

Dashboards, Reports, Ad Hoc

OLAP Analysis

Alerts & Exception Based Management

Portal

Core and Trading Systems

OperationalData

Su

b L

edg

ers

FinanceWarehouse

GLProcurement

ExpensesAssets

Payables

Technology/Hardware Master Data Mgmt Controls, Governance

Sales Plays Lead Pillar

Economic Buyer

Bill of Materials Customers

Finance Modernization

Apps (ERP)

CFO • ERP (Accounting Hub & GL)• OFSAA-EPM– PFT / PFT BI• Hyperion -HFM, C&D Mgt.• OFSAA-ERM (Rec Framework,

Hedge Management) • Edge – DRM, OPA, GRC

• Many for selected components e.g. FAH, GL, HFM

• Implementing full stack (OFSAA+eBusiness ERP+EPM) – RBS

• Implementing Operational Finance) – Nomura, Scotiabank

• TIAA CREF – (completing GL, OFSAA and BI.

Risk Adjusted Performance Management

Apps (OFSAA)

CFO • OFSAA-EPM – PFT, FTP, PFT BI, ALM BI, BSP

• OFSAA-ERM – ICAAP Analytics, Economic Capital and/or Basel II

• EPM – HPCM, Planning, B/S Planning, Hyperion Strategic Finance, Scorecard, DRM, BI Applications

• Implementing – NAB (FTP & “Management Ledger”)

• Implementing – PNC, TIAA CREF, Fifth Third, USAA

• Live – US Bank• Many OFSA 4.5 clients for PA, TP (and to a

lesser degree RM)

Enterprise Risk & Capital Adequacy

GBU (OFSAA)

CRO or GM Treasury

• OFSAA-ERM, ALM, Credit, Operational, Market, Liquidity, Basel II,ICAAP

• Implementing – PNC (Credit Risk, Basel II)• Implementing – JP Morgan (Liquidity Risk),

ANZ (ALM for Liquidity Risk)

Agile Financial Services Analytics

GBU (FSDW)

CIO • FSGBU – FSDW / OFSAAI, Rec Framework, Basel II Analytics

• Apps – PFT BI, ALM BI• EPM – OBIEE, ESSBASE, DRM

• Implementing – BNY Mellon• Implementing – RBS

Financial Services IBU Solution SetsEnterprise Risk and Finance

Analytics

Oracle Financial Services Analytical Applications Infrastructure

InfrastructureArea

Analytical Applications

Reconciliation

Asset Liability

Management

Fund Transfer Pricing

ProfitabilityManager

Balance Sheet

Planning (CF)

Liquidity Risk Management

Stress Testing

Finance Financial Management

Financial Accounting

Hub

General Ledger

Financial Management

Disclosure Management

Workforce Planning

Balance Sheet

Planning (UI)

Capital Asset Planning

Planning Financial Analytics

ALM Analytics

Profitability Analytics

Hedge Analytics

Data Quality

Metadata Management Framework

Data Model

Components are part of the Oracle Financial Services Analytical Applications Infrastructure Product

Computations and Rules Framework

Mart Management Framework

Security and User

Administration

Advanced Analytical

Infrastructure

Oracle BI EE

Date Relationship Management

Oracle UPK Fusion Middleware

Oracle Product Mapping

Open Systems Platform - Oracle Database, Exadata and Exalogic

Supporting Solutions

Hedge Management

EssbaseGovernance,

Risk & Compliance

© 2011 Oracle Corporation – Proprietary and Confidential

PerformanceManagement

CustomerInsight

Governance& Compliance

RiskManagement

Treasury Risk

Credit Risk

Governance and ComplianceRegulatory Compliance (Financial Crime)

Channel Insight

Analytical CRM

Anti-Money Laundering

Trading ComplianceBroker Compliance

Fraud DetectionOperational Risk

Retail Credit Risk

Corporate Credit Risk

Portfolio Analytics

Marketing Analytics

Service Analytics

Channel Usage

Channel Performance

Economic Capital

Regulatory Capital

Liquidity Risk Stress Testing

Economic Capital Advanced (Credit Risk)

Operational RiskEconomic Capital

Performance Management and Finance

Accounting Hub

Activity-Based Costing

ConsolidationProfitability

Oracle Financial Services Analytical Applications

Budgeting and Forecasting

Hedge ManagementIFRS 9 – IAS 32/39

ICAAP

Customer Profitability

Stress Testing

Asset Liability Management

Market Risk

Basel II

Retail PortfolioRisk Models and Pooling

Funds Transfer Pricing

Loan Loss Forecasting Pricing Management

RAPM

Balance Sheet Planning

Know Your Customer

Reconciliation

© 2011 Oracle Corporation – Proprietary and Confidential11

Uni

fied

Anal

ytica

l Met

adat

a

Building BlocksShared Components across Applications

FINANCIAL SERVICES ANALYTICAL APPLICATIONS DATA MODEL

FINANCIAL SERVICES BUSINESS INTELLIGENCE

DataSources

Reports Alerts Dashboards Embedded

Purpose Built Engines Common Tools Business Rules Stochastic Modeling

Common Objects Common Dimensions Pre-Integrated/Extensible High Volume

FINANCIAL SERVICES ANALYTICAL APPLICATIONS FRAMEWORKS

© 2011 Oracle Corporation – Proprietary and Confidential

Uni

fied

Anal

ytica

l Met

adat

a

Building BlocksShared Components across Applications

FINANCIAL SERVICES ANALYTICAL APPLICATIONS DATA MODEL

FINANCIAL SERVICES BUSINESS INTELLIGENCE

DataSources

Reports Alerts Dashboards Embedded

Purpose Built Engines Common Tools Business Rules Stochastic Modeling

Common Objects Common Dimensions Pre-Integrated/Extensible High Volume

FINANCIAL SERVICES ANALYTICAL APPLICATIONS FRAMEWORKS

ASSET|LIABILITY

MANAGEMENT

BALANCE SHEETPLANNING

PROFITABILITY & FTP

MANAGEMENT

BASEL II

REG CAPITAL

CUSTOMER

INSIGHT

© 2011 Oracle Corporation – Proprietary and Confidential

Application-Specific Processing Area Results AreaStaging Area

Analytical Calculations

Cash Flow Engine

Data Model

Results for consumption

Common input area

for analytical

apps

Oracle Financial Services Analytical ApplicationsHigh Level Process Flow

© 2011 Oracle Corporation – Proprietary and Confidential Slide 14

Application-Specific Processing Area Results AreaStaging Area

Profitability

Funds Transfer Pricing

Asset Liability Management

Economic Capital

Liquidity & ICAAP

Basel II

Profitability Analytics

General Ledger

ALM Analytics

Market Risk Analytics

ICAAP Analytics

Oracle Financial Services Analytical ApplicationsHigh Level Process Flow

Products

(instruments)

Other

Infrastructure and Data Model

Common Cash Flow Engine

© 2011 Oracle Corporation – Proprietary and Confidential Slide 15

Financial Service Analytics Application Data Model

Staging Processing Data Marts

Common Staging Area App-specific processing

Shared ProcessingTables

App-specific result tables

Common Metadata

Facts Dimensions

Product Processors

Transactions

Ledger

COA

Product

Org

Customer

Exposures

Time Series Data (Rates, Indicators, risk factors etc)

Display Codes/Master tables

Master Data

ALM

FTP

PFT

MR

CR

OR

aCRM

Basel II

Instruments (29)

LedgerStat Account

Summary Tables

Common Dimensions, Hierarchies, Master Tables

COA

Product

Org

Customer

ALM MR

CR OR

aCRM

Basel II

Campaigns

Time Series Data (Rates, Indicators,

risk factors etc)

GRC

ExposuresT2T

Shared output tables

Profitability

Instruments Tables1. Current Accounts2. Savings Accounts3. TD Contracts4. OD Credit Lines

Accts5. Loan Contracts6. Credit Cards7. Mortgages8. Leases9. Mortgage Backed

Securitization10. Bills Contracts11. LC Contracts12. Guarantee13. Mutual Funds14. Money Market

Contracts

15. Mortgage Offset Accounts

16. Futures Contracts17. Options Contracts18. Repo-Contracts19. Fct Swaps20. Forex Contracts21. Break Funding22. Borrowing23. Forward Rate

Agreement24. Insurance25. Investment26. Annuity27. Trusts28. Retirement

Accounts29. Other Services

© 2011 Oracle Corporation – Proprietary and Confidential

© 2011 Oracle Corporation – Proprietary and Confidential Slide 17

The Case for Platform and PerformanceLiquidity Risk

• New mandates like Basel III are driving need for on-demand answers

• Global events or crises have near instantaneous impact

• Banks need to calculate stressed results in minutes not hours

• Contingency funding strategies need to be iteratively tested in a practical timeframe

Regulatory Capital

• Reporting is stressful and time consuming with little time for analysis

• Performance bottlenecks leave little margin for error

• Demand for additional submissions with modified assumptions and calculations

• Demand for advanced analytical practices like stress testing and what-if analyses

Profitability

• Tighter controls, laws limiting bank fees and slower revenue growth driving need for efficiency and cost controls

• Need for on-demand view of costs and profitability – move beyond monthly reporting requirements.

• Need for faster and more granular review of product performance

• Need to quickly response to market shifts and changing rates.Senior executives are left scrambling to bridge key limitations in

• Performance & Scalability• Responsiveness• Simulation & What-If Capabilities

© 2011 Oracle Corporation – Proprietary and Confidential Slide 18

Extreme Performance in Financial Services

Oracle Profitability Manager to execute 172 allocation rules across 250 million accounts+ 1 billion transactions Reduction from 48 hrs to 4 hours and 45 minutes.

Oracle Basel II for Regulatory Capital Calculations on Exadata Database Machine X2-2 executing Risk-Weighted Asset Calculations On 65 million exposures in only 1 hour and 29 minutes

Oracle Liquidity Risk Management on Exadata Database Machine X2-2 Business-as-usual liquidity gaps for 370 million cash flows 65 million accounts in just 69 minutes. Stressed liquidity gaps in only 10 minutes.

Oracle Basel II Solution in the Leaders’ Quadrant for

2005, 2006

Celent Group ranks Oracle Basel II as the North

American Leader in Basel II

Tower Group regards Oracle OFSAA as a specialized

and well architected platform

Forrester regards Oracle Reveleus as one of the top

”purpose build” GRC applications

Oracle Financial Services Analytics Highly Commended

in The Banker’s 2006 Technology Awards

Financial Insights regards Oracle as one of leading

operational risk vendors

Tower Group regards Reveleus as the “Crown Jewel” of

i-flexsolutions

Chartis Research ranks Oracle OFSAA among the top

10 Ops Risk vendors globally

Celent ranks Oracle OFSAA as one of the top 3 Ops

Risk vendors worldwide

Industry Recognition

Customer and Analyst Credentials

Representative Customers (300+ Globally)

© 2011 Oracle Corporation – Proprietary and Confidential Slide 19

Enterprise Risk and FinanceMarquee Wins – FY10 / FY11

• BOM – Apps, GBU, EPM, BI, Tech

• BOM – Apps, EPM, BI, Tech

• BOM – GBU, Apps (FAH), BI

• BOM – GBU, Apps

• BOM – GBU, Apps

• BOM – GBU, Apps • BOM – Apps, GBU

• BOM – GBU

© 2011 Oracle Corporation – Proprietary and Confidential Slide 20

COMPANY OVERVIEW a Fortune 100 financial services organization that is

the leading retirement provider for people who work in the academic, research, medical and culture fields. Headquartered in NYC, TIAA CREF serves 3.7 million active and retired employees participating at more than 15,000 institutions and has $453 billion in combines assets under management (as of 12/31/10).

• Net Income: US$ 1.405 billion (2010)• Employees: 7,2000

MISSION/OPPORTUNITIES• Reduce complex, redundant and costly processes

prohibiting timely and efficient financial close, detailed management information and reporting

• Provide world class configurable solution(s) to the institution for developing performance metrics with the necessary transparency to drivers and results

• Investment in technologies that will support corporate strategy for growth

SOLUTIONS• Oracle General Ledger and Financial Acctng

Hub• Oracle Financial Services Analytical

Applications (Data Model, Profitability, Profitability Analytics)

• Oracle Business Intelligence• Oracle Planning and Strategic Finance

EXPECTED BENEFITS• Single source of consolidated and detailed

finance and management information• Efficient and centralized accounting and

general ledger • Comprehensive best practice engines and

intelligence for multi dimensional profitability analytics

• Enterprise strength and ease of use business intelligence providing transparency and actionable data.

• Provide technologies and solutions that can scale for performance and the expected aggressive growth of the institution.

TIAA CREFSales Play – Finance Modernization

SwedbankCustomer ProfileActivities: Retail BankingGeography: Regional, Nordics EuropeAnnual turnover~ 1.000 Billion €

Historically being a group of individual (independent) Savings Banks, the largest ones being merged and listedKeeping administration for the rest of Savings Banks

Business Problems

Business RequirementsFeed multiple CoAs

Support transition from old to new system (no immediate cross-over)

Keep separate ledger for separate Savings Banks

Being able to enter Manual Journals

Centralize and store Accounting rules

Project InfoStatus: Live since June 16th 2008Implementers: Functional setup: Cap Gemini Project Management: Local Partner FAH functional: Oracle consulting Technical: Oracle Consulting + Customer

• Old Backoffice systems (ATLAS) was being replaced (Calypso), including Accounting Engine

• Old GL could not be immediately decommissioned (basis for reporting)

• New GL Structure/Architecture• Need for new integrated platform for

Accounting & Analytics• Not adequately prepared for future sources of

transaction data• Straight through processing with clear status

tracking

COMPANY OVERVIEWNomura Holdings is the parent company of Nomura

Securities, Japan's leading investment bank and brokerage house. The company performs trading, equity and bond underwriting, research, and mergers and acquisitions (M&A) advisory services. It also makes private equity and venture capital investments. Nomura's largest segment is domestic retail, which provides investment consulting and brokerage services to consumers in its home market.. Nomura Holdings has operations in more than 30 countries. In 2008, Nomura acquired the European and Asian operations of Lehman Brothers, as part of it’s goal to become a leading Global Investment Bank

• Assets Under Mgt ¥24.7 trillion(FY 2010)• Total assets ¥36,692,990 million (FY 2010)• 35,630 employees

MISSION/OPPORTUNITIES• Become a world class competitive financial services

group• Create Change to contribute to the development of

capital markets and generate growth opportunities• Act as a bridge between Asia including Japan and

Europe and the United States

SOLUTIONS• Oracle Peoplesoft Financials and Expense

Management• Hyperion Financial Management• Hyperion Profitability & Cost Management• Hyperion Financial Data Quality Management• Financial Analytics• Supporting Oracle Technology

EXPECTED BENEFITSObjective of Global Financial Architecture(GFA):• To build the platform to allow for strategic

decision making through timely and dynamic reporting to executive level personnel

- Daily, accurate management information- Allow faster adoption to social and

institutional changes• Achieve efficient management and cost

reduction by consolidating multiple IT assets and disparate business processes globally.

- Cost reduction by server consolidation

Nomura Holdings – INTERNAL USE ONLYSales Play – Finance Modernization

National Australia Bank – INTERNAL USE ONLYInformation Analytics Platform TransformationSales Play – Information management, ERM

COMPANY OVERVIEW National Australia Bank is a financial services

organisation with over 40,000 people, operating more than 1,800 branches globally. NAB operates major financial services franchises in Australia, as well as businesses in New Zealand, Asia, the United Kingdom and the United States. Each brand is uniquely positioned but built on a common commitment to providing quality products and services, fair fees and charges, and relationships built on the principles of help, guidance and advice.

• Net income A$4.58 billion (2010)• Total assets A$685 billion (2010)

MISSION/OPPORTUNITIES

• Assisting exploitation of NextGen Banking Platform

• Drive cost reduction through Process simplification, Technology simplification,Reduction in reconciliation and control effort, Reduction in cost of change

• Enhancing individual business capabilities

• Mine the cross enterprise services opportunities (particularly Risk , Finance, Capital Management and Customer Insight)

SOLUTIONS

• Oracle Financial Services Analytical Applications (Profitability, FTP, ALM Data Model, Profitability Analytics, Corporate and Retail Credit Risk, Basel II, Basel II Analytics)

• Oracle Financial Accounting Hub

• Siebel UCM

EXPECTED BENEFITS

• Support core banking transformation by realigning activity execution

• Provide support for support for multi-branding and rapid product manufacture independent of brand

• Establish a holistic perspective across enterprise service focuses – risk , finance, operational support

• Reconcile information across the required dimensions

• Leverage industry maturity and development to reduce complexity and speed reaction time to market opportunities and regulatory needs

Royal Bank of Scotland – INTERNAL USE ONLYFiRST - Finance and Risk Systems TransformationSales Play – Finance Transformation, ERM

About the RBS FiRST Program

• FiRST is a transformation exercise which RBS has embarked upon with an aim to bring unification & greater transparency to finance & risk processes within the bank

• The bank with the success of this program aims to present a coherent picture to the regulator (FSA – Financial Services Authority) in the UK across its risk & finance numbers

• The bank has hired a senior-level executive to own the unification of risk and finance

• RBS has done an extensive evaluation for finance, consolidation & risk systems as the bank is looking at a player who can invest in this proposition as a partner & support a Tier1 global player such as RBS

• The bank’s aim is to do as minimal customizations as possible and deploy the out-of-box functionality proposed as part of the Oracle solution stack

• The bank intends to complete the transformation exercise by FY 2013

Split across LOB’s (Net LF), approx. % of deal for each Oracle LOB

OFSAA (FSGBU) 27%

ERP

26% ERP II

Apps EPM 22%

BI 5%

Technology 20%

  Total 100%

Anatomy of the Deal

Solution ExpertiseIBU Enterprise Risk and Finance coverage

Yadhunath Srinivasan, Singapore(JAPAC ERF POC)

Patrick Ng, Hong Kong

Kiran Kesavarapu, India

Rob Woods, Australia

Bill Greene, NY(NAS ERF POC)

Mark Smedley, WA(NAS Geo Lead)

Frank Siderio, PA

Luis Arturo Diaz, FL

Stephen Skrobala, Spain(EMEA ERF POC)

Nazif Mohammed(EMEA Geo Lead)

Irma Coetzee

Stuart Houston, Hong KongERF Global Solution Manager

© 2011 Oracle Corporation – Proprietary and Confidential Slide 26

Enterprise Risk and FinanceGlobal Contacts

Asia Pacific

Yadhunath Srinivasan

[email protected]

+65 8112 7152

Based in Singapore

Europe, Middle-East, Africa

Stephen Skrobala

[email protected]

+34916312801

Based in Madrid, Spain

ERF Global Solution Manager

Stuart Houston

[email protected]

+852 6016 5399

Based in Hong Kong

The Americas

Bill Greene

[email protected]

+1 973 960 4796

Based in New York

© 2010 Oracle Corporation – Proprietary and Confidential

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