Techcombank: - Temenos

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Temenos Case Study Current IT System Internet External Access External Servicing Remote Acess T 24 T24 Applications Interfaces Ancillary applications Statement / Report Printing T24 is supported by just 3 ancillary applications: Transware Card, Avaya Call Centre and a content management system Sustained investment Since going live with T24 in 2003, Techcombank has made multiple additional investments to the platform, to upgrade its technology and functionality and to extend its usage. • In 2004, Techcombank upgraded to the latest version of Globus, G13. This took a team from Techcombank 4 months. • In 2005, Techcombank upgraded to the latest release of the software, which had been renamed to T24. This took a joint team from Temenos and Techcombank 2 months. • In 2006, Techcombank upgraded to the next release of T24, R05. As Techcombank had by this time developed greater expertise on the product, they were able to manage the upgrade using only internal resources and in just 2 months. • In 2007, Techcombank – again without assistance from Temenos – upgraded to R07, which also included taking an additional module, for management reporting. • In 2009, Techcombank installed T-Risk, Temenos’ solution for the Basel II regulations. • Techcombank’s next project, which will start by the end of 2009 and run into 2010, is to upgrade from R07 to R09 and, at the same time, move from Temenos Internet Banking (TIB) to ARC Internet Banking. 5 “Techcombank is a sophisticated Temenos customer. They have developed a very high level of internal competence on T24, which enables them to upgrade without outside assistance and, in addition, allows them to exploit the existing functionality to run ever greater parts of the bank.” Chris Longden, Regional Director Asia Pacific, Temenos
Temenos Case Study Nguyen Duc Vinh CEO, Techcombank “ Temenos T24 has enabled Techcombank to enjoy the extraordinary growth since its live date. Where Techcombank has outperformed and how technology has facilitated this Overview As we shall show in the following sections, T24 has played a key part in Techcombank’s ability to outperform its competitors. T24 has enabled Techcombank to differentiate its customer offering, through more personalised service and more innovative products, which has allowed it to grow deposits so quickly and, in turn, assets and profits so sustainably. Moreover, the packaged nature of the software coupled with its pervasive use within the bank, has made possible the realisation of significant scale economies, which have sustained the level of operational improvement. Lastly, the complete view of risk afforded by T24 has permitted rapid growth in assets without any material deterioration in asset quality or the bank’s risk profile. 5 year operating profit CAGR to 2008 5 year revenue CAGR to 2008 0% 20% 40% 60% 80% 100% 0% 20% 40% 60% 80% 100% 120% 140% Vietin VBARD SCB Note: The size of the bubble represents the banks’ asset size Mr Le Xuan Vu CIO, Techcombank Product innovation “ VB TCB ” Techcombank: clear outperformance Not only are we able to launch new products faster than competitors, but the flexibility of the system means that all of our processes are fully aligned to this new product. In contrast, even if a competitor reacts quickly and launches a similar product, this is likely to involve a significant amount of manual processing – until the system can be configured appropriately – resulting in much lower productivity. Techcombank’s superior product innovation has helped it capture an ever greater share of customer deposits – and, impressively, without sacrificing net interest margins - while its superior customer service has engendered loyalty in its customer base and, in turn, has made that deposit base extremely sticky. Even though Western banks are likely to rely to a greater extent than before on customer deposits for funding – as Boston Consulting Group notes, “the battle for deposits has intensified” 1 - wholesale lending has only ever been a minor source of bank funding In Vietnam. Therefore, it has always been paramount for Vietnamese banks to grow customer deposits as fast as possible - and without surrendering too much interest - in order to be able to grow assets and profits quickly and sustainably. 6 Source: Company annual reports, Reuters, The Banker Database, broker notes ” 1 “Living with New Realties: Creating Value in Banking 2009”, Boston Consulting Group, February 2009
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Techcombank: - Temenos

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