As banks set ever more ambitious targets for cost cutting and improving efficiency to cope with competition, there is an increasing reliance on external service companies that provide the tools and ideas required to help the banks meet these goals. From back-office outsourcing of mountains of paperwork to magic boxes that devise risk management solutions, service companies are assuming a larger role in the financial services industry. At The Banker, we thought it time to take a look at these service providers and reward them for the work they are doing to create a leaner and more efficient banking industry. Here are The Banker's first-ever Service Contracts of the Year.

Call Centre Solutions: Genesys

"We are using Genesys for the functionality it gives us on call management and because it offers an open platform," says Gian Piero Racchetti, contact centre department manager at Italy's IntesaBci. "With Genesys, we can use any application and, importantly, share applications. Genesys is functional and flexible."

Mr Racchetti wanted to use a contact centre to offer a variety of services to customers. He turned to Genesys for help. Genesys Telecommunications Laboratories provided solutions that enabled IntesaBci's contact centre agents to transmit and receive voice, data and video images over the internet. Key to this is the new Genesys voice over internet protocol (VoIP) option, which allows real-time verbal and video communications to take place via internet protocol data links. Currently being successfully piloted, video kiosks are being rolled out during the rest of this year.

"Genesys developed this software version expressly for us. It will be generally available at the end of the year and again it means we can give our customers added value," says Mr Racchetti.

Analytical CRM: DataDistilleries

Spaarbeleg, part of the Aegon insurance group, called in DataDistilleries to provide a system that would automatically alert its relationship managers to a customer's possible interest in a product without interrupting the service or beginning an awkward sales conversation.

DataDistilleries is the only vendor in the analytical customer relationship management (a-CRM) market that can generate real-time sales recommendations on a real-time basis, at the point of customer interaction. The project has resulted in a 100% increase in product sales on inbound calls, a 7.5% increase of conversion rates of inbound customer calls and E10m in sales per year on 20 million inbound calls.

What sets the project apart from other CRM roll-outs is Spaarbeleg's use of real-time customer analytics to increase sales. It also brought a fast return on investment. DataDistilleries' analytics extends across every customer touch point, including web, Wap and SMS. Its customer modelling allows marketeers, not statisticians, to develop the models that are used to generate the recommendations in the call centres. The project was swiftly completed in 100 days.

e-CRM: Amacis

Amacis established a relationship with HSBC about 18 months ago, when the bank selected Amacis Visibility to support its internet and interactive television banking initiatives. The bank recently became the first customer of Version 2 of the product, which allows it to develop its electronic customer interaction strategy further.

Version 2 incorporates a browser-based contact centre agent application. This allows agents to access the power of Amacis Visibility from a standard web browser and still have fingertip access to all the features of the Java application. It also allows the bank central control access to the application without worrying about agent PC configuration or agent location.

After the terrorist attacks on the World Trade Center, financial institutions are focusing more on applications that can be centralised and distributed, making database mirroring and management much simpler. Version 2 incorporates the ability to support custom channels, such as bank-approved secure e-mail systems. It has the ability to dispatch marketing campaigns to customers and provide full response metrics using the product's powerful categorisation engine.

"The move to Version 2 is a natural progression for HSBC and will allow us to manage our global customer interaction solutions in an efficient and controlled manner," says Kevin Flockhard, HSBC's project manager for electronic services.

On-line security: RSA Security

Clear, Europe's leading electronic bill presentation and payment consolidation provider, selected RSA Security's BSAFE encryption tools to secure its online services. Clear is the UK's first online bill viewing, payment and management system, consolidating household bills in one easy-to-use site.

"Security for our billers and their customers is at the heart of our offering," says Kelley Knutson, chief executive of Clear. "RSA Security has the expertise and the leading security technology to provide a safe service that can grow and adapt to our business."

Clear uses the RSA BSAFE Crypto-C and Crypto-J cryptography components to encode user passwords and encrypt customer credit/debit card numbers as soon as they are entered into the Clear web server. For Clear it was important that its product offered cross-platform support that would scale easily as the service develops and give customers secure access by mobile phone, personal digital assistant or interactive TV.

Back-office outsourcing: Unisys

For any life and pensions company, the pressure to deliver excellent service to customers while increasing efficiency and cutting costs is more important than ever. In February 2000, Abbey Life, which is now part of Lloyds TSB, faced an even greater challenge when it sold its sales operation to Zurich Financial Services/Allied Dunbar Assurance, effectively closing its doors to new business. This dilemma prompted a highly innovative and substantial outsourcing agreement, whereby Abbey Life signed a £225m, 10-year deal to outsource all its life and pensions processing and administration to Unisys.

To support the client's requirements, Unisys has established a new subsidiary, Unisys Insurance Services Limited (UISL). The subsidiary now offers its leading edge services to other UK insurers.

Abbey Life supported 18 disparate systems handling more than 1.75 million policies, so migration to a single solution hosted by a third party made strategic and financial sense. Also, some 1000 of Abbey Life's employees have been transferred to support the UISL operation.

The benefits to Abbey Life have been substantial. They include long-term expense reduction, guaranteed unit costs, transfer of risk associated with IT systems ownership and improved customer service turnaround times. In spite of being a new market entrant, UISL is already the largest life assurance third-party administrator in the UK.

IT outsourcing: NIIT

NIIT, the New Delhi-based IT solutions company, has been working with the Dutch bank ING Group for more than two years; and in the past 12 months it has firmly established itself as ING's preferred partner for outsourcing. It maintains a dedicated facility for ING in Calcutta, which is a centre of competency in legacy technologies and platforms. The strength of the NIIT team has grown from four people to almost 100 during this period.

NIIT has worked in partnership with ING in several strategic projects and the two groups have a joint application development framework in place. NIIT has been involved in several firsts for ING. It set up the first shared service centre, the first global support competence centre and the first common payment system for ING Europe.

It is NIIT's expertise in legacy technologies and platforms that provides the key to the ING partnership. Primary projects that ING has outsourced to NIIT include the maintenance of a business application, euro conversion for insurance applications, the development and design of a shared service centre application for banking, and the design of a payment application to improve the performance and automation of international payments.

Risk management: SunGard

SunGard Trading and Risk Systems' market risk management system, Panorama, was awarded a contract in June to provide its market risk management tool to Spain's savings banks' association, CECA. The association's 41 member savings banks will have their existing front-line trading systems connected to Panorama via the tool's integration gateways.

All files can be passed into Panorama to obtain the overall risk position, says Richard Petti, sales director for the Iberian and Mediterranean region for Panorama at SunGard in London. Panorama has more than 120 financial services clients worldwide, from asset managers to banks and hedge funds.

"CECA submitted a tender in the middle of last year and Panorama was one of two shortlisted," he says. "One key factor to consider was functional, in that CECA's audience is not the bread-and-butter credit risk people but rather a domestic one. The other is technological: CECA required a specific architecture to get 41 banks on line, which is not a trivial project. It wanted to offer leadership in terms of new models and analysis, and it needed to have an accessible platform."

STP solutions for exchanges: Cap Gemini Ernst & Young

Last summer Nasdaq Europe opened the first stock exchange designed to meet the needs of the European market and to operate on a totally pan-European basis. At the heart of the new exchange is Nasdaq's European Trading System. There was no question of simply replicating existing US systems; the ETS had to be tailored to European regulatory regimes, trading conventions, clearance and settlement processes.

Cap Gemini Ernst & Young (CGE&Y) was entrusted with providing external help in programme management. Its initial tasks were to put in place a logical structure for the entire programme and processes that would control progress and ensure the agreed launch date. It developed the milestone plan, a series of well-defined target milestones for each of the several work streams which, if completed on schedule, would guarantee the programme's success.

One unusual factor was the impossibility of a live pilot exercise, as stock exchange conventions dictated that all players in the market must have equal access at all times. To achieve that while minimising the risks of going live on a "Big Bang" basis, CGE&Y built a graded series of five simulations into the programme, which involved no real trading but with all systems in live mode. The changeover to going live went as planned, with all systems functioning 100% and all 40 members starting to trade immediately.

STP solutions for international banking: Global Crossing

Global Crossing designed, developed and engineered a new network environment for Swift, an industry-owned co-operative of more than 3000 of the world's largest banks, broker-dealers, securities depositories, clearing organisations, investment managers and exchanges. The network integrated new approaches and technologies that supported Swift's business model. The design included the plan for implementing the network and providing a path for the migration of users from the existing network. Global Crossing constructed a migration path unique to Swift with the goal of maximising cost and time benefits for the customer and ensuring financial and technical flexibility throughout the process.

"Under this unique partnership arrangement, Swift will co-design, co-implement, co-test and co-manage the network with Global Crossing, while our customers will experience the advantages of a single provider, a single network and a single point of contact," says Joe Eng, Swift's chief information officer.

STP solutions for an individual bank: Netik

Citigroup selected Netik for its global Global Straight-Through Processing Association (GSTPA) integration solution. The solution includes Netik products and services from the company's flagship InterStream solution set as well as GSTPA-specific components. Citigroup had already invested $10m in InterStream. The solution includes several components: STP management, such as transaction tracking and repair, InterChange for application integration, InterView for data warehousing, InterRec for matching and reconciliation and InterLink for industry standard and proprietary messaging and connectivity. Citigroup will combine the STP that was facilitated by the previous implementation of Netik InterStream with the GSTPA solution for integration with the Axion4 TFM to make significant gains towards T+1 processing.

"The Netik InterStream solution enabled us to completely re-engineer our infrastructure," says Citigroup senior vice-president Michael McGovern. "We now plan to leverage our InterStream implementation fully by integrating the Netik GSTPA solution with the streamlined processing we achieved with the Netik InterStream solution."

Systems integration: Carreker

Carreker Corporation was engaged by Central Carolina Bank (CCB) - an $8bn organisation - to manage its merger with all systems and operations of National Commerce Bancorporation (NCB), a $7.5bn organisation. The merger included all legacy systems and all bank business and operational areas.

To fulfil analyst and shareholder expectations, meeting the timeline for integrating the two organisations was critical. Carreker worked with CCB to set up the project management office for co-ordinating the conversion work performed by CCB's applications software development (ASD) department, and for overseeing all aspects of the integration. It also provided consultants as project managers for critical aspects of the project. The teamwork between CCB's ASD department and Carreker allowed its merger and consolidation with NCB to be completed on time with minimal customer impact.

According to Karen Thor, CCB executive vice-president and chief information officer: "Carreker's approach allowed us to go about the business of being a bank and to concentrate more on the critical systems conversions while it managed the integration and co-ordinated with our ASD area. Getting the project done on time was worth a great deal of savings to us, and I seriously question whether we could have completed the project on time without Carreker. It went better than we could ever have hoped, thanks to the Carreker team's expertise and professionalism."

The following two categories are service contracts in which banks were the suppliers

Cash management: ABN Amro

The Royal Dutch/Shell Group's European oil products business (Shell) awarded Dutch bank ABN Amro a major cash management contract for its European oil products division, covering 18 countries. Under the five-year contract, ABN Amro will deliver a full range of cash management services, including cash concentration, payments, collections and management of partner banks for Shell's extensive network of wholesale and retail operations.

"Shell is excited about this new contract and the standardisation and simplification it brings," says Peter Voser, finance director of Shell Europe Oil Products. "Streamlining of the cash management operation will deliver cost savings and give us flexibility to reach quickly to new e-business opportunities."

ABN Amro will be the primary cash management bank for Shell Europe Oil Products in western Europe. All transaction enquiries will be routed through ABN Amro.

Global custodian: State Street

State Street was appointed to supply global custody, accounting, securities lending, performance analytics, compliance monitoring and foreign exchange services for Philips Pensioenfonds, the third largest pension fund in the Netherlands with some E16bn assets. State Street is providing a full range of investment services. Along with the mandates that State Street recently won from ABP, Siemens and Volkswagen, the Philips mandate advances the bank's market leadership in Europe.

"State Street's focus, experience and technology, coupled with the calibre and expertise of their European servicing team were key factors in our decision to appoint them as servicer of our fund," says Gabriel van de Luitgaarden, Philips Pensioenfonds' chief financial officer. "The sophisticated, total investment servicing package offered by State Street provides us with world-class, unparalleled support, allowing us the opportunity to focus on our core business."

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