Complying with Revised Capital Standards

Caixa Catalunya, Spain’s third-largest savings bank, is the first Spanish bank to implement a standard software solution that will help the bank to comply with the new regulatory framework. The bank said it chose SAP’s Basel II software and Accenture implementation services, following a competitive vendor review, as the most effective solution for savings in time and resources as well as for helping to meet current and future regulatory requirements, both nationally and globally.
The Basel II Capital Accord revises and expands current capital and risk-management standards for banks operating internationally. Global rules issued in 2004 increase banks’ focus on risk management in both credit and operational areas, more closely aligning regulatory and economic capital to better reflect market risks. As part of implementing these standards over the next few years, banks must utilize and disclose to the market broader and more detailed information about risk management. “We believe that the tandem of SAP and Accenture is the best choice to guarantee the success of the regulatory and economic capital management project,” said Xavier Boldu, Infrastructures and Organization Area Manager, Caixa Catalunya.
The SAP Basel II application, part of SAP’s analytical banking solution set for banks, supports regulatory compliance by providing integrated information support for all finance and risk-related business processes. The application supports the need for banks to meet Basel II requirements for credit-risk calculations of risk-weighted assets. The application’s flexible structure and open reporting functions help banks improve internal risk management, including risk-adjusted pricing and addresses future credit risk reporting requirements.
Through their alliance for the financial services industry, Accenture and SAP offer solutions for banks and insurers worldwide. Together, the companies have implemented Basel II capabilities at banks around the world, including Absa (South Africa), Bank of Ireland (Ireland), BPU Banca (Italy), FinanzIT and HSH Nordbank (Germany) and Nordea (Norway). “Most banks do not have a complete global picture of their market, credit and operational risks, yet government pressure for Basel II compliance continues to grow,” said Thomas Balgheim, senior vice president, Financial Services, SAP AG. “As part of SAP’s core banking solution, the Basel II offering helps banks prepare their Basel risk model by providing an integrated application architecture view into business processes, enabling a strategic platform for ongoing compliance.”
“Caixa Catalunya is an example of the enhanced benefit that the alliance between Accenture and SAP brings to a client—a standard software solution that meets a timely, critical and complex business need combined with implementation by a team with deep industry experience and solution knowledge,” said Juan Barcena, Accenture managing partner, Financial Services, Spain. Caixa Catalunya and Accenture have worked together closely since 1992. They created Informació i Tecnología de Catalunya (ITC), which provides IT services to the bank, in 1998. This joint relationship has helped the bank improve its efficiency ratio, which measures operating expenses against revenues, by more than 180 basic points in the past four years. The bank’s recent agreement with SAP and Accenture was closed in Q2 2005.

Source: SAP AG