SAS helps ČSOB Bank meet stricter regulatory requirements for client assessment
Managers knows how the client portfolio develops and are able to decide how to approach the clients.
Daily updated online reports as well as the complete history of each client in one place.
- Ensuring compliance with a new regulatory requirement
- A “single truth” about the client across the Group
- A centralized solutions improves effectiveness and reduces costs
- Automatic e-mail alerts and reporting
- A modular system that is easy to maintain and modify
SAS is an open system that allows us to modify calculations to take into account new parameters or requirements. We designed the solution in collaboration with SAS experts to be versatile and modular so that we could reuse parts of scripts. Another advantage of working with the SAS platform was fast implementation of the project and low demands on human resources - two people needed only three months to develop the initial minimum viable product (MVP), which is significantly faster than comparable banking projects usually take. Petr Fabera Head of Data Management ČSOB
ČSOB Group, originally founded by the Czechoslovak state in 1964 as bank for financing foreign trade and convertible currency operations, is currently one of the top 3 financial Services providers on the Czech market and the leader on the mortgage, building savings loans, private banking, and leasing markets. ČSOB Group provides its services to client segments, including individuals as well as SME, corporate, and institutional clients, under multiple brands and through various distribution channels. The Group manages a wide portfolio of activities in different stages of development and with different positions on the market. ČSOB is a wholly owned subsidiary of KBC Bank NV, whose shares are held (directly or indirectly) by KBC Group NV. Both companies are registered in Brussels, Belgium.
Same client, same criteria
ČSOB Group includes about twenty largely autonomous brands that operate their own information systems. Until recently, each brand would assess client risks and creditworthiness using different methods based on their own respective data. However, the Czech National Bank, which is the national regulatory and supervisory body for the financial market, newly requires that the entire group assess clients using identical methods and criteria. That means that a client that happens to be in default towards one company in the Group will be viewed by the rest of the Group in the same way, hence such client will not be granted another credit product.
Three options on the table, the fourth one wins
To comply with the new regulatory requirement, it was necessary to find a solution that would assign an attribute to the client under a simple set of rules based on an analysis of aggregate data from all members of the Group. At the same time, the system needs to notify all companies about the result of the assessment. Another requirement was that data associated with regulated activities go through the central data warehouse. The bank initially considered either acquiring a packaged application, developing its own system, or adapting existing tools for the new purpose. After weighing all aspects, the bank eventually decided for the fourth option - implementing an analytical platform from SAS to build the new solution. Based on requirements from all the departments concerned, project definition was finalized at the end of summer 2019. By the end of the year, the SAS team created the necessary infrastructure. Subsequent development of the solution took less than two months. In contrast to the original task – to calculate an attribute and assign it to the client – the project grew in scale significantly as it actually needed to cover a wide range of processes. Along the way, it turned out that certain processes were too rigid, and their changes would require disproportionate cost, so it was necessary to find different was while preserving those processes. Development continued until October 2020 when the new system went live. After some fine-tuning, the project was completed in March 2021.
We needed to have reports that would show us how the client portfolio develops and be able to decide how to approach the clients and what steps would be appropriate to take. The SAS solution that provides daily updated online reports as well as the complete history of each client in one place, has exceeded our expectations by far – we were originally thinking about Excel-based reports distributed by e-mail. Renata Ponertová Process Manager ČSOB
The result exceeded expectations
The project ensured compliance with the new regulatory requirement quickly and with a low cost. A comprehensive solution was created that delivers a single source of truth about the client to share within the group, with next-day updates. The system collects data from banking systems of all subsidiaries and business units on a daily basis, analyses them, issues automated alerts and reports, and hands over information back to the respective transactional systems. Processing of the data for the entire Group using a single tool saves time, costs, and resources. Although further development of the system is not on the agenda, the solution is versatile and allows for future modifications at minimal cost. At the same time, it is open, preserving know-how within ČSOB Group, not just on the part of the vendor. Some departments use the solution not only for compliance purposes but also for further analyses.
Collaboration with the SAS solution team comprising ČSOB’s own staff and SAS consultants worked absolutely smoothly. In particular, I appreciate their open and constructive approach to solving issues as well as the ability of data experts to speak the language of business, making it easy to communicate with the customer and correctly interpret business requirements. Renata Ponertová Process Manager ČSOB