IBM Industry Solutions for BFSI Rajeev Narayanan Country Leader, Industry Products IBM India/SA

1. IBM Industry Solutions for BFSIRajeev NarayananCountry Leader, Industry ProductsIBM India/SA V.1.0

2. A Smarter BFSI focuss on three key imperatives…. REINVENT THE BUSINESS MODEL • IBM BSFI Industry Solutions - Enabling speed, flexibility & choice in solution deployment • Banking Performance Management • Managing Security, Risk & Compliance in BFSI • Securing Enterprise Data for Banks • Managing Quality & Security of Banking Applications • Unified Business Process Management for Collaborative Process Improvement • Payment Systems: Evolution and Framework • Better Customer Service Through Exceptional Web Experiences DEVELOP NEW INTELLIGENCE FINANCIALSERVICES INTEGRATE RISK MANAGEMENT

3. What we are hearing from our Customers ? Ability to respond to change and communicate well – with faster time to market Banks more closely linked to ‘Value to Customer’, Improve Customer Profitability at the same time Plan for Growth, Be Local with Global Best Practices Ability to gauge, and interpret risks and take massive action Simplicity – value for money, one face to the bank, integrated payments, safe and secure 1 2 3 4 5

4. What are Indian Banks doing … thinking ? • Retail Banking Deposits , have a 33% ROE for the Retail Banking Portfolio and have a significant influence on a banks growth in markets like India, Bangladesh, Srilanka, etc. • Banks have worked on revolutionizing service levels and convenience for their customers. Customers are redefining the rules of the game. • 24% of banks structured their Payments business on both product and channel lines; 42% structured their business on product lines while 34% structured their business on channel lines. Banks are looking towards moving to enterprise payments. • Treasury is a significant contributor to the banks earnings in India, and have worked towards using sophisticated Risk Management Techniques, while the public sector is still nascent just to comply to regulatory and compliance measures. • Banks in growth markets are increasingly leveraging IT to establish competitive advantage • Select growth market private and foreign banks are spending less than US $ 11 per account on IT systems and services, compared to an average spend of US $ 76 per account in European banks.

6. Emerging Themes Payments and Securities helps you progressively transform your payments operations to become more flexible and efficient Core banking transformation allows you to modernize and renovate the applications that support core banking functions while aligning with the changing needs of the business Core Banking • Objective is to … • Extending Banking and pre-built solutions to speed time to market. • Bring in best practices and business- specific usage patterns to lower risk • Support for adoption of open and industry standards • A choice of business applications to best suit customer needs • An approach to align technology with business needs Integration Optimization Analytics Collaboration Security Resiliency Customer care and insight helps you build a foundation for creating a single view of the customer and enabling more effective and efficient sales and service Customer Care and Insight Payments and Securities Integrated risk management supports taking a holistic approach to managing financial risk, financial crimes, operational and IT risk, and compliance Integrated Risk Management This gives you speed, flexibility and choice in deploying solutions while reducing cost and risk!

7. Banking Industry Framework Core Banking Transformation Projects • Single View of Customer • Integration Platform • Infrastructure Scalability • Model Driven Development Architecture Transformation Customer Care and Insight Core Banking Transformation • Dynamic Relationship Pricing • Bundled Offerings • Product Agility • Flexible Core Business Process • Performance Monitoring Integration Optimization Analytics Collaboration Security Resiliency Process Agility Payments and Securities Integrated Risk Management • Replace outdated legacy applications with best-of-the-breed application components • Replace outdated legacy applications with packaged applications • Develop next generation applications • Renovate existing legacy applications Application Modernization

8. Reusable application components (e.g., interest rates, price optimization) plus composable building blocks (e.g., arrangement, campaign) • A common vocabulary using Business Glossary and pre-populated with IFW terms Banking Vocabulary Services Components Building Blocks • A canonical data/message/service model based on IFW to simplify integration • Specific solution accelerators (e.g., product bundling, loan origination); includes architecture, design, and a reference implementation Banking Data/Message/Service Model Solution Templates • Extensions for MDM Server that include core banking specific concepts such as loan, credit card, and deposits • A collaborative integrated solution development platform for core banking that integrates transformation methods, tools, and assets Banking Extensions for MDM Server Banking Transformation Workbench • Proven architectural design work products for core banking projects • Common foundational IT services such auditing, logging, and security to speed solution development and deployment Common Shared Services Design Rules Core Banking Transformation Extensions and Accelerators

9. Customer Data Integration • Common Data Warehousing and Models • Enable Information as a Service • Customer Analytics • Business Insight • Search & Discovery Analytics • Threat & Fraud Intelligence • Multi-Channel Transformation • Marketing • Sales • Service • Cross Sell / Up Sell • Lending Optimization • Dynamic Product Bundling • Customer On-boarding (aka Account Opening) • Case Management • Contact Center Optimization • Disputes • Event-Based Decisions • Customer Segmentation and Profitability • Campaign Management • Marketing Communication • Customer Preferences • Know Your Customer Customer Care and Insight Framework Projects Information Insight Interaction Customer Care and Insight Sales Core Banking Transformation Integration Optimization Analytics Collaboration Security Resiliency Service Payments and Securities Integrated Risk Management Marketing Compliance

10. Provides services references templates for building dynamic customer care processes WebSphere Banking Content Pack • Proven pattern and capabilities to accelerate the creation of integrated retail delivery applications WebSphere Multichannel Bank Transformation Toolkit Customer Care and Insight - Extensions and Accelerators • Customer-oriented banking process and data models speed requirements definition and implementation IFW / BDW Process & Data Models • Detailed design templates for accelerating data warehouse development Banking Data Integration Accelerators • Process and integration models provide a higher order composite services in relation to Master Data Management Server Common Business Language Services Accelerator • Best practice business and technical patterns for an account opening SOA-based solution Account Opening • Pre-defined data, process and policy models for enterprise planning, and financial management and control Banking Performance Blueprints …and more 10

11. Integrated Risk Management Holistically manage risk across the enterprise • Get Your Risk Data in Order • Risk Insight and Control • Real Time Risk Insight and Control • Risk Optimization • Risk Modeling and Scenario Analysis Financial Risk Customer Care and Insight Core Banking Transformation • Suspicious activity reporting • Integrated Fraud and Financial Crimes platform • Transaction Monitoring & Detection • Integrated Case and Investigation Management Integration Optimization Analytics Collaboration Security Resiliency Financial Crimes • Comprehensive Security Control, Enforcement, Mgmt • Trusted Identity Management • Configuration/Incident/Problem/Change/Release Management • Continuous, comprehensive fault monitoring • Data Protection • Application Integrity and Security • Operational Risk Platform Payments and Securities Integrated Risk Management Operational and IT risk Governance and Compliance • Compliance Information Lifecycle Management • Corporate Governance and Internal Control • Sales and Market Conduct Compliance • Regulatory Compliance • Prudential Compliance • Collaboration for Legal and Compliance 11

12. Integrated Risk Management - Extensions and Accelerators • Provides real time identity and relationship recognition and resolution • Provides industry-leading credit risk insight with specialized templates to create executive dashboards and reports COGNOS Banking Risk Performance – Credit Risk Entity Analytics and Global Name Recognition • Consolidates credit / underwriting, market, and operational risk information into an enterprise-wide view • Risk-specific banking process and data models speed requirements definition and implementation IFW / BDW Process & Data Models COGNOS Finance & Integrated Risk Management (FIRM) • Blueprint for integrating risk information with enterprise-wide, distributed profitability management • Access and identity management, change management, and fault monitoring capabilities simplify audits for IT governance, risk and compliance regulations IBM Service Management for IRM COGNOS Risk Adjusted Profitability Blueprint 12

13. Payments & Securities Projects • SEPA Infrastructure • SEPA Mandates Management • SWIFT / SEPA Process Integration Regulatory Compliance • Corporate Financial Supply Chain Optimization • Corporate Payments ESB • Global Liquidity Management Corporate Services Customer Care and Insight Core Banking Transformation • MERVA Modernization • “Single Window” for SWIFT Processing • Standards Management SWIFTNet Modernization Integration Optimization Analytics Collaboration Security Resiliency SWIFTNet Modernization Payments and Securities Integrated Risk Management • Retail Processing • Payments Card Industry Compliance • International ACH and Consumer Remittances Retail Payments Retail Payments • Payments Process Renovation • Least Cost Routing • Payments Processing ESB • Faster Mass / High Value Payments • Account Validation Payments Process Efficiency Digital Payments Conversion • IBM Payments Director Implementation • Imaged Check Processing • Duplication Detection 13

14. IBM Payments Best Practices Payments Integration Use Cases IFW-Based Data Model Reference Payments Process Models Reference Payments Services Interfaces Payments Objects User Interface Financial Transaction Manager ISO20022-Based Internal Canonical Format State Engine Timer Services Flow Coordinator FTM for WebSphere Message Broker Payments & Securities - Framework Extensions and Accelerators • Assets for building an enterprise payments services bus that provides transaction-level visibility to payments • Provides a single window to SWIFTNet services and reliable processing of high volume messages WebSphere Business Integration for Financial Networks Financial Transaction Manager • Common banking process and data models speed requirements definition and implementation • Enables data transformation to industry standards (e.g., NACHA, SWIFT, FIX) WTX Industry Packs IFW / BDW Process & Data Models • Best practice business and technical patterns for implementing a corporate payments solution • Provides efficient XML data management to industry standards (e.g., SWIFT, FIX, FpML, TWIST ) Corporate Payments Scenario pureXMLTM Payments Bundles • SOA-based templates for faster development of payments business services …and more WebSphere Banking Content Pack 14

15. Channels App DB DW Core Systems ERP App CRM DB Branches App DB DB Core Systems App CRM ODS DB ATMs DW App DB Core Systems Call Centers App CRM DB Customer CIF App DB DB Core Systems Internet App CRM DB Partners DW App DB Capital Markets Core Systems Relationship Managers/ Agents App CRM DB • Information Locked in Repositories • Inconsistent Data • No Single Version of the Truth • Poor Channel Communication • Inconsistent View of Customer • Silos of Information Lack of Common landscape in financial services hinders innovation with information Business Units Data Systems Retail Banking Corporate Banking Wealth Management Insurance

16. Deliver Enterprise Customer View Deliver Enterprise Insight Manage Risk and Compliance Improve Data Governance The gap between today’s capabilities and those needed in the future need to be addressed to create true competitive advantage Current State Complex Business and Technology Initiatives Desired State Big Gap Master information governed by an infrastructure that makes data available across the enterprise, when and where it’s needed Information, business process logic are captive to applications, aligned to organization silos. As a result…. As a result…. Optimize Business Processes • Information management platform and strategy leveraged across business and IT initiatives • Information services feed a flexible SOA, separating information from process • Consumes 40%+ of IT budget • Inhibits flexibility and competitiveness • Proliferation of point solutions or departmental silos Control Threats and Fraud Big Gap

17. IBM Brings a Variety of Capabilities to our Services Engagements At a minimum, world-class consultants armed with Processes, Methods and Tools That can be augmented with any or all of + + + + Sales Accelerators Delivery Accelerators Solution Building Blocks / Code Assets Solution Guidance • Executive Briefing • Client Presentations • Thought Leadership • Proposal Templates • Demo’s • Assets to accelerate Solutioning and Delivery • Industry Process and Data Models • Reference Architectures • Project Estimating Tools • Testing Guidance • Overview of how the Solution should be built Differentiating Assets CBM, CBTM Integration Assets CIF AD Implementation Toolkit, Technology Assets Improved Revenue, Lower Cost, Optimised IT , Market Differentiation, Improved time to market

18. Business Solutions needed to respond in an increasingly competitive and regulative landscape Respond to increasing regulation Respond to customer demand Maintain among best C/I Increaseagility and responsiveness Innovate business model, products and services Our Solutions Offerings have been based on implementation with other industry leaders Core banking & payment transformation Front Office Optimization Back Office Optimization Trade process Transformation Risk, Compliance & Governance Workforce, collaboration & performance Business performance management Based on Industry Frameworks & a mix of In-house and 3rd party assets Insight CBM IFW/IIA SOA Ref. Arch. Assets Service Mgt./Outs. North America sites United States Europe sites Mechelen/Nossegem Montpelier Milan (2) Ehningen Frankfurt Kista/Solna Winterthur Portsmouth/The Nest Warwick Canada Calgary Toronto Montreal Atlanta (2) Ashburn Boulder Chicago Columbus Dallas Lexington Los Angeles Miami Japan sites Haga Sagmino Kawasaki Makuhari Nanko Mitaka Mihama Copenhagen Brno Dublin London Paris Shenzhen Madrid Seoul Lisbon India sites Bangalore Chennai Hyderabad Sterling Forest Tokyo Turin Gaithersburg Shanghai Szekesfehervar Mexico City Taipei Caracas Hong Kong Dubai Bogotá Singapore Service Delivery Center e-business Hosting Services (e-bHS) Business Continuity andRecovery Services (BCRS) EMEA Regional Global Delivery Center (GDC) Global Delivery Center Santiago Hortolandia Sydney Sao Paulo Ballarat Johannesburg Montevideo Melbourne Buenos Aires Canberra Auckland Wellington • Functions, process, data and services models • Data warehouse based on ISO20010 • Service oriented architectures • Decoupling of applications and infrastructure • IBM partners with all major ISV vendors • IBM Websphere and hardware • Global application and infrastructure services • Global business process outsourcing • CEO and CIO studies • Point of Views based on industry research • Banking/Insurance competences & capabilities • Industry reference maps Supported by tailored Methodologies, Techniques & Tools Management Methods Techniques Tools • Program management method • WWPPM project management • Business Case & Value realization management • Strategy & Change methods • Custom delivery methods for Business and IT projects • SOMA • Component Business modeling • IFW Process modeling • SOA modeling • Rational Portfolio Manager • M&A Accelerator • Websphere process modeler IBM will use its capabilities, assets and client experiences supported by a strategic partnership relationship to help realize these benefits