Financial Services

[Steve Bennett]

Australian IT article today is cross-posted here.

[Doug Heywood]

ING Direct redesign extends to open source mash-ups

By Ry Crozier 28 October 2008 IT News Australia

ING Direct has redesigned its information architecture to provide the underlying structure to double its size within the next five years.

The online bank, which claims to have over 1.25 million customers in Australia, made the ‘brave decision’ to redesign its systems 18 months ago to support the future growth expectations laid out by CEO, Eric Drok, according to the bank’s head of business intelligence and analytics, Steve Bennett.

Its online direct model created double-digit growth and ‘incredible exposure’ for the bank in its first ten years, according to Bennett.

“The [business] model works, but as we grow more complex we needed to be able to rely on our ability to leverage information as a core strategic capability,” said Bennett.

Over the years, the information platform evolved very rapidly but in a largely ad hoc way.

At the same time, ING Direct also wanted to shift its analytics focus from 'looking in the rear view mirror to concentrating on how we put in a predictive capability', said Bennett.

After joining ING Direct from Gartner, Bennett immediately started work on the platform redesign. Rather than re-invent the wheel, he reached out to ‘a few’ of ING Direct’s other global franchises and asked for their data models.

“We looked for best practices and how they might apply to our situation,” said Bennett.

ING Direct’s platform rebuild includes an Oracle database, Informatics ETL, upgraded Business Objects/SAS business intelligence and analytics software, and Microsoft’s Performance Point Server.

“We’ve spent a lot of time looking at how we can present the information,” explained Bennett.

“The primary end user tool is SAS/Business Objects, but we’re also experimenting with the idea of mash-ups.”

Bennett said the bank was evaluating the Ruby-based Webby technology to deliver the information mash-ups.

“We’re just beginning to dip our toes in,” said Bennett.

“For example, we’re looking to introduce sparkle lines to enable us to pack a new dimension into limited screen real estate space. It’s a way of increasing the usefulness of that Webby report or object to the end user, but if you do that two or three times it means you can get much more bang from your investment.”

Sparkle lines use an algorithm to convert a set of figures into a font. Bennett demonstrated how this could enable ING Direct to squeeze an additional line diagram or simple graph into an existing analytics report, thereby making it that little bit more useful.

Making use of screen real estate is particularly important as users increasingly access reports on small screen devices such as mini-laptops and smartphones.

“Our most successful analytics report is a daily text report on how the business performed as of close of business the previous day that is delivered to Blackberries,” said Bennett.

Bennett was speaking as part of the DW 2.0 event in Sydney.

[JohnnyBgood]

From today's The Sheet:

12 November 2008 6:37am

Australian banks are expected to invest in key risk technologies to boost their defensive position over the next 12 months in response to the global credit crisis.

IT expenditure will come under new scrutiny but the area is no longer regarded as an easy target for cost cutting.

Industry analyst Gartner forecast in July that spending by Australian financial services institutions would grow marginally from US$11.5 billion in 2008 to US$US11.7 billion in 2009.

Last week it revised downwards its ICT spending forecast for the Asia Pacific region, estimating 8.3 per cent growth in 2009 instead of 11 per cent.

Several banks have already said they will make sizeable cuts to IT spending through staffing levels and non-strategic long term projects.

Those cuts will give banks some leeway to keep on track critical core banking projects already budgeted for and investments needed to support growth and business transformation.

But as the economic crisis bites worldwide, banks will shift to the foreground counter-cyclical technology tools such as collections and recovery systems, credit scoring systems, and portfolio and exposure analytics, according to industry analysts who have held private talks with banking executives over the past six weeks.

Chief information officers have also indicated they will increase their use of compliance software that delivers greater government oversight and greater transparency of information.

“It’s critical for banks, especially investment banks, to get a better view of the customer and make sure they have an understanding of their exposure,” said Michael Araneta, senior research manager, Financial Insights Asia/Pacific, who surveyed 70 regional banks, including six major Australian banks, in late September.

“A lot of the solutions needed to survive and recover from this crisis such as risk, recovery and credit scoring systems, will be needed.

“They also really need to assess whether their existing systems can cope with the pressure in the system and for that they’ll need exposure analytics.”

As the public shifts its focus to savings, several retail banks are beefing up customer-oriented systems either to improve service or to boost efficiencies in collection and debt recovery.

ANZ recently invested in improved collection technology to stem the increase in arrears levels, while at Westpac the customer has moved to centre stage.

“The priority is making sure that we support our customers, and at least in those areas [the bank] is going to improve delivery and service to customers,” said Westpac’s chief executive Gail Kelly at a media briefing on the 2008 results.

Kelly identified plans to address problems Westpac has suffered with its delivery platforms, which had affected customer support.

“We recognise that [our delivery platforms and associated processes] clearly need work to enhance our reliability and to equip us to support our customers in the way that we would like,” she said.

Westpac also plans to deploy new tools and technologies such as scoreboards to support front line staff with additional data.

Kelly identified customer support as a priority from its integration with St George, to be steered by CBA’s former CIO, Bob McKinnon, and said Westpac would improve its contact centre delivery.

NAB has already started an upgrade of its contact centre technology.

The renewed customer-centric focus is also expected to give weight to business intelligence systems that help branches assess the performance of sales staff, analyse customer behaviour and generate more cross-selling opportunities.

“Perhaps if banks and financial services companies established BI systems and metrics as to the ratios of what kind of debt they were holding versus the cash reserves they had, their analytics systems might have driven alerts earlier in the process,” noted Melissa Martin, senior market analyst at IDC Australia.

The credit squeeze will make every technology decision count but with the financial sector in flux most banks are saying little about their technology roadmap for 2009, other than that their major projects are on track.

A number of substantial technology initiatives lie ahead including up to $1 billion for new technology in NAB, including its NexGen platform; several bank integration projects; ANZ’s upgrade to its network of automatic teller machines; and CBA's four year, $580 million program to overhaul its core banking legacy systems.

These projects are expected to come under renewed scrutiny in relation to cost management, the quality and turnaround times of new applications rolled out and improved discipline.

Performance benchmarking is one area that will emerge as a priority as these projects progress, according to Martin.

Integration software will be in demand alongside automation applications that enable workforce reductions and productivity enhancing applications.

Technologies already in place will likely be leveraged for further value such as virtualization, which draws on a pool of shared resources for multiple needs, and services oriented architecture which allows an application to be re-used.

Rather than face cuts, telecommunications is expected to be further exploited to reduce travel costs, with more meetings conducted via conference call or videoconferencing.

Tier two banks are likely to accelerate IP data technology plans as well as voice over broadband deployment to cut the cost of fixed voice.

Across the region, vendors are restructuring ICT contracts to take into account new cost sensitivities.

Contracts are being converted from those linked to headcount to fixed-price agreements with payments staggered over a longer time frame, said Financial Insight’s Araneta.

“This crisis calls for more discipline on all fronts.”
Article By: Helene Zampetakis

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[Doug Heywood]

... CBA had real-time BI?

From today's SMH:

Account chaos hits CBA

The CBA has been flooded with calls after a computer bungle affected online accounts. Photo: Kate Callas.

November 25, 2008 - 12:57PM

As many as 200,000 Commonwealth Bank customers across Australia have found themselves short of money today after an online glitch mistakenly duplicated withdrawals from their accounts.

The double-up, caused by an overnight processing error, has affected NetBank customers, the bank said this morning.

It hoped to rectify the glitch later today but admitted it could take until tomorrow morning.

Meanwhile, the bank has been deluged by calls from people "seeking clarification" about their accounts.

"The bank is working to identify the cause of the error and understand how many customers have been impacted," a statement read.

"Our technical teams are working to rectify the issue and reverse these duplicated transactions as a priority."

NetBank is the online outlet of Commonwealth Bank's banking services.

"Any customers impacted by this and who are seeking immediate cash should visit one of our branches," the bank said.

"No customer will be charged fees or interest as a result of this problem."

A number of customers have reported additional problems with Commonwealth Bank transactions in recent days.
One customer said the problems had occurred as early as Friday with automated payments being deducted twice.

Another told Fairfax Radio that he pulled into a petrol station at 1am today and went to pay with his credit card but was told there was no money in his account when there was supposed to be over $5000.


Commonwealth Bank shares rose $1.55, or 5.1%, to $31.77, broadly in line with the general market.

czappone@fairfax.com.au

[Doug Heywood]

Faster than the speed of fright from Friday's Fin Review

Cross posted here.