FreningsSparbanken Gert Engman Group EVP and Chief Information - PowerPoint PPT Presentation

FöreningsSparbanken Gert Engman Group EVP and Chief Information Officer

2 IT-costs and EMU preparations

3 IT-costs FSPA group % SEK M 2 600 19,5 2 400 19,0 2 200 18,5 2 000 18,0 1 800 17,5 1 600 17,0 1 400 16,5 1 200 16,0 1 000 15,5 1999 2000 2001 IT-costs IT-costs as % of Group total costs Development accounts for approx. 30% of costs and operations and maintenance for the balance

4 Transactions and use increase but the cost of IT is constant Amw transactions/channel – per day average since 99-07-01 MSEK 4,0 3,5 Millions transactions per day Intern. 3,0 2 200 Branch 2,5 ATM Tel 2,0 1,5 2 000 1,0 0,5 1 900 0,0 y y y y n v n t v n r l p v r l p r a u a u a l p a a o a u o o a a a e e M J M J M e M M N M J N N J J J S S S 9 0 9 0 IT costs 1999 –> 2002

5 Application and IT architecture • Yesterday – Early core banking systems were monoliths – with rigid integration of satellites – Objects in the ’90s – too difficult to re-use • Today – Components – promises re-use, less complexity and shared development – Striving for standards in software – From silo to multi-layered architecture – Software standards make it possible to buy, not build – Leads to cheaper and faster IT

6 On-going IT projects • New core banking system • Component based middleware platform • EMU • Basel II • Data warehousing and CRM Our plan is to include the majority of these projects in “normal” IT expenditure - with the exception of EMU.

7 Effects of implementation of new core banking system Cost development scenario 1 2 3 4 5 6 7 8 9 10 11 Present system New system 0% real time New system 25% real time New system 50% real time

8 Main EMU-related projects • Alignment and conversion of IT systems • Education and information to customers and staff • Physical exchange of bills and coins

9 EMU - political alternatives Probability estimates by FSPA’s EMU group Probability 1 EMU entry Jan 1, 2005. Transition period. 50 % Money exchange January, 2006. 2 Direct transition Jan 1, 2006. 35 % Money exchange January, 2006. 3 Direct transition Jan 1, 2005. 5 % Money exchange January, 2005. 10 % 4 EMU entry Jan 1, 2007. Transition period? Money exchange?

10 EMU – master plan 2002 2003 2004 2005 2006 Money Forewarning period Qualified period of preparation Transition period ex- Application change Formal plan Refer- Out- Appli- EU EMU Referendum Start Election endum come cation OK entry date set money exch. National ? ERM2 Transition period plan Scenario analysis, planning IT systems IT clean-up initiation Adjustments/Preparations Program finish Adjustments and pre- IT adjustments (contd.) Money Transition parations ”in advance” Acceptance tests IT and exch. (mainly IT) implementation FSPA’s plan Register Preparations for register Developm. of systems & rou- conversion conversion tines for register conversion

11 IT-related EMU costs • EMU-related projects are expected to increase IT costs by some SEK 300 M in 2003 and 200 M in 2004

12 If the vote is NO... • Major cleaning up of systems • Replacement of older systems due for retirement • Sunk costs approx. SEK 200-250 M