Asia Pacific Banking IT Priorities in Response to the Global Recession (Strategic Focus)

Table of Contents

OVERVIEW

• Catalyst
• Summary

KEY MESSAGES

• APAC is well placed to weather the global recession
• The lessons of 1997 have enabled APAC to face the financial crisis in a strong position
• The regulatory response will be centered around transparency and more stringent reporting
• APAC will remain an attractive IT market despite the downturn
• Capital market integration will drive investment in infrastructure and market data solutions
• Strong APAC banks on the acquisition trail will present IT integration opportunities
• Integrated reporting and analytics can bring benefits across risk, finance and operations

MARKET OPPORTUNITY

• APAC is well placed to weather the global recession
  • Increased Chinese demand is key to the ' decoupling' of global growth from over-reliance on the US
  • The lessons of 1997 have enabled APAC to face the current crisis in a strong position
  • CASE STUDY: past mistakes strengthen Australian banks for the future

• APAC will remain an attractive IT market despite the downturn
  • The downturn will drive a renewed focus on costs across all aspects of the business
  • Processes and infrastructure are being re-engineered for efficiency and to build a platform for growth
  • Utilization and cost efficiencies will be sought in infrastructure

• The regulatory response will be centered around transparency and more stringent reporting
  • Flexible reporting structures can be leveraged across multiple compliance requirements
  • Data volumes and compliance needs will combine to drive reporting automation
  • APAC markets continue to strengthen fraud and AML measures

• Capital market integration will drive investment in infrastructure and trading data solutions
  • Exchange integration is gathering pace in the quest for efficiency and low latency across the region
  • Strong APAC banks on the acquisition trail will present large IT integration opportunities

CUSTOMER IMPACT

• There is a return to core banking activities and a re-engineering of core platforms
  • An increased focus on treasury and cash services is driving investment in integrated service platforms
  • Core banking transformation is a priority due to the limits of legacy systems and M&A integrations

• Integrated reporting and analytics can bring benefits across risk, finance and operations
  • Integrated reporting and analytics can bring significant benefits to performance management
  • Integrated risk and finance reporting platforms will assist the management of both risk and liquidity

• Banks are looking for efficient delivery of processes, applications and infrastructure
  • Efficiency and future growth needs will both drive BPM investments, but compliance is the key catalyst
  • Banks are looking at cost-effective and flexible approaches in application delivery
  • Virtualization has been widely adopted to optimize infrastructure in APAC
  • Datacenter consolidation can also carry commensurate green benefits

GO TO MARKET

• Opportunities are to be found in APAC banks providing integrated and flexible platforms
  • Banks in advanced and newly industrialized economies are looking to take the place of global institutions
  • Adaptability to regulatory environments is a key feature of successful cash and liquidity solutions
  • In light of pending regulatory changes, flexibility will be the key selling point across APAC
  • In developing markets, banks are looking for consolidation and standardization of infrastructure

• Recommendations
  • To operate in such a diverse region, a keen appreciation of cultures and customs is mandatory
  • Vendors should target a wider range of stakeholders as risk integrates with operations and finance
  • Virtualization vendors should emphasis cost benefits in the initial phases
  • Green IT outcomes should be pushed as a win-win by vendors in utilization technologies
  • Vendors of all sizes must stress how they can meet today' s needs of cost and implementation efficiency

APPENDIX

• Global banks by market capitalization, 2008 - 09
• Definitions
• Methodology
• Further reading
• Ask the analyst
• Datamonitor consulting
• Disclaimer

TABLES

• Table: The emerging regional framework
• Table: A sample of banks' core system projects underway as legacy systems reach their limit
• Table: Vendors should extol the virtues of server consolidation across core IT infrastructure
• Table: A changing of the guard: global banks by market capitalization, 2008 - 09
• Table: APAC Coverage

FIGURES

• Figure: Regional groupings
• Figure: Developing Asia to provide greatest growth opportunities during the downturn
• Figure: FM IT spending in emerging APAC will be more resilient than in mature markets
• Figure: Cost control and IT efficiency driving IT strategy in APAC
• Figure: Banks must address their cost base while positioning themselves for regional growth
• Figure: Every effort must be made to leverage existing compliance investment
• Figure: Fraud and process automation are IT compliance investment priorities in APAC
• Figure: Fraud and AML are a key component of operational risk
• Figure: APAC banks poised to benefit from weakness of global banks
• Figure: Consolidation and re-engineering are the order of the day in APAC
• Figure: ANZ is typical of large Australian banks in targeting Asia for future growth prospects
• Figure: Reporting solutions must be leveraged across multiple business requirements