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_experience the commitment TM

CGI Banking & Investment 2011 User Group Conference

Treasury Services

June 1st to June 3rd, 2011

Introduction and Welcome

Presenter: Steve Coronel

3

Introduction and Welcome

• Welcome

• Introduction Remarks

• Presentation of Participants

• CGI Treasury Services Team

• Clients

• Documentation Package

• Agenda

• List of Participants

4

Presentation of Participants - CGI

• William Lovering – Managing Director

• Steve Coronel – Business Development Representative

• Luc Poulette – Senior Technical Leader

• Joe Soares – Client Services Manager

• Qing Chen – Client Services Representative

• Gelu Duplenschi – Client Services Representative

• Maxime Poulin – Senior Technical Advisor

5

Presentation of Participants - Clients

• Mouvement Desjardins

• Catherine Bourbeau

• André Leclair

• Christian Roy

• Marshall & Ilsley Bank (M&I)

• Nick Knobel

• PNC Bank

• Robert Hardway

• Matt Novak

• Rita Michel

• Robert Raymond (presenter)

• Jonathan Stock

6

Presentation of Participants - Clients

• U.S. Bank

• Harriet Gilbert (presenter)

• Jennifer McMenomy

• Donna Novotny

• Duane Shaw

• The Norman Group

• James Kessler (presenter)

• Whitney National Bank

• Richard M. Spicer III

7

Agenda

Treasury Services Updates

Presenter: Bill Lovering

TS Business Highlights

TS Business Growth:

• Achieved revenue growth of 15% (2010 to 2011)

• 3 New FX Customers:

• MB Financial (Chicago)

• National Bank Financial (Montreal)

• Whitney National Bank (New Orleans)

• 3 New ASP Customers:

• US Bank (White Label)

• MB Financial (FX Product Suite)

• Whitney National Bank (FX Product Suite)

• CSAP Scores Improvement:

• Average score of 8.9 /10 in 2010

• Average score of 9.3 /10 in 2011

9


FX Product Suite Enhancements: • Partnership with PNC to develop the next generation of FX

RateHub:

• Liquidity provider hub allowing connection to multiple rate sources simultaneously:

• In-bound connectors – RBS & Deutsche Bank

• Provides access to buy-side client trading portals:

• Out-bound connectors - FXall

• 15-month project:

• Very complex, functionally rich code

• Foundation product for the strategic direction of the FX Product Suite

• Partnership with US Bank to develop the next generation of FX White Label:

• Enabling US Bank to deliver rates and FX services to their downstream clients

• New White Label is the standard for the future direction for this solution

10


FX Product Suite Enhancements: • Project FhoeniX:

• FX Sentry Phase III – Back Office

• Targeted for client delivery Q4 2011

• Certification and delivery of v3.68 of the FX Product Suite

• Installed at PNC, MB Financial & US Bank

• Upgraded and implementation of v3.67 of the FX Product Suite at 2 client sites:

• Over 60% of the TS Client base is on version 3.67 or higher

• Sunset versions 3.60 and lower in June 2010

• Delivery and implementation of a series of large, client funded development projects

• Finalized a comprehensive TS Product Roadmap and Business Plan

• Sets the strategic direction of the FX Product Suite for the next 5 years

11


TS Team:

• Current Team is 35 members

• Team Growth – 5 new hires in past 12-months:

• 3 senior developers

• 1 Technical QA

• 1 Project Control Officer

• Moved to a new office location in November:

• 1130 Sherbrooke Street

• CGI Head Office

• Eileen Roy:

• Retired on May 6, 2011

• 35 years of service to CGI

• Functional Reorganization of the TS Team

12

Project Management and Operations

Francois Marcoux:

• New Manager of Project Management and Operations

Key Responsibilities:

• Establishment of a TS PMO

• Management of all TS Projects – Internal & External

• Management of TS Financials – Cost Management and Profitability

• Project Support – Clients, Client Services Team and Development Team

• Management of the all IPMF Projects and Initiatives

• Liaison to the GTA / B&I PMO

• Management of the TS 90-Day Plan

• TS Business Operations: HR, Facilities, Procurement, Ensemble, TS Website, Team Communication and Special Events

Direct Reports:

• Marie- Claude & Delphine

13

Client Services Team

Joe Soares:

• Promoted to Manager of Client Services


• Client Relationship Management - TS clients (FX & SwixMortgage)

• Professional Services - Revenue Generation, Invoicing, Financial Budgeting and Revenue Forecasting

• Client Facing Documentation - Proposals, RFP Responses, SOW‟s, CR‟s, etc

• New Sales - Support to Steve Coronel, Demo‟s, Bid Reviews, Proposals and Client Presentations and Meetings

• Marketing – Newsletter, Technical Notifications, White Papers, Market Research and Competitive intelligence, User Conference, Trade Shows

• IPMF - Product Roadmap and Business Financials

• Help Desk - Reporting Metrics, SLA Adherence, ASP & DRP Support

Direct Reports:

• Qing, Gelu & Help Desk

14

Senior Business Advisor Team

Luc Poulette:

• New Manager of the Senior Business Advisor Team


• Responsible for setting the strategic direction of the FX Product Suite - Functionality, Technology & Architecture

• R&D Oversight & Direction

• Application and Technical Support to Client Services & Development Teams

• Executive / Senior Client Relationships - Business, Application and Technical Consultation

• New Client Implementations

Direct Reports:

• Newly created Senior Technical Advisor position

• Max Poulin

• Newly created Senior Business Advisor position

15

16

New Functional TS Team Structure

TS Business Growth Objectives

Growth Strategies:

• Double the annual revenues of the business by 2016

• Grow our North American market position & presence

(traditional Regional Banks and smaller FI‟s)

• Generate new revenues from non-North American markets (Europe, Middle East, Latin American, Asia, Australia)

• Create partnerships with strategic resellers where CGI does not have a local presence.

• Continued focus on IP investment and targeted product development in order to enter new North American and Global markets

• Continue to grow ASP revenues

• Maintain high functionality / low cost market position

17

18

Grow the TS Business by Marketing

and Selling the FX Product Suite

Globally

Continue to deliver Service

Excellence to our FX Clients

and remain focused on our

traditional market niche

Continuing commitment to design

and develop New Products,

Services and Solutions to

compliment the existing FX

Product Suite

Demonstrated commitment to

the TS Business through CGI

Funded Investment in the FX

Product Suite over the next 5

years

Treasury Services Business Drivers

19





years

Continuing commitment to

design and develop New

Products, Services and

Solutions to compliment the

existing FX Product Suite

Grow the TS Business by

Marketing and Selling the FX

Product Suite Globally

Service Excellence to our FX Clients

• Continued focus on service delivery excellence,

customer response time and issue resolution

• Increased Industry and application knowledge of

the Client Services Team

• Improved quality assurance testing and the

implementation of increased control standards

• Implementation of more stringent and specific

Service Level standards

• Full product suite delivered under an ASP model

• Enhanced Services – Disaster Recovery, After-

Hours Support, 24/5 and/or 24/7 Support

• More face-to-face business meeting with clients

20













CGI Funded Investment

• Development of a comprehensive 5 year Business

Plan & Product Roadmap:

• $ 1.7M investment in the FX Product Suite by

the end of 2013

• Total of $ 3.0M investment by the end of 2015

• Migration to a pure Java platform

• Enrich and modernize the FX product suite as the

future platform for new and existing clients

• Build required functionality to enter into new

markets

• Strategic Products & Solutions:

• FX Sentry, Chapel WebFX& FX RateHub

21










• Maintain strong focus on existing client base through

proactive marketing campaigns and interactions

• Sell the full FX Product Suite to North American

Regional Banks

• Pursue smaller North American institutions who

provide online foreign exchange capabilities to their

customers (Chapel, WL, ASP)

• Generate revenues from non-North American

markets (Europe, Middle East, Latin American, Asia)

• Establish partnerships with strategic resellers where

CGI does not have a local presence

• Maintain high functionality / low cost market position

Market and Sell FX Product Suite Globally





years

22





years








New Products, Services and Solutions

• FX Sentry III – Back Office

• Chapel Modernization & Web 2.0

• FX RateHub Next Generation

• FX White Label Next Generation

• User Interface and Workflow Design

• Modularization / componentization of FX

Product Suite

• FX Retail Branch

• Web Trading ,Order Book, NDF, FX Options, i18n - Internationalization

Thank You for your Business!!!!!

23

http://www.bnymellon.com/util/tononsecure.cfm?Dest=/index.html

http://www.mbfinancial.com/

Treasury Services Roadmap

Presenter: Joe Soares

Roadmap Drivers

25

Perform market analysis and

stay current with regulatory changes.

Ongoing review and

enhancement to current platform.

Product Life Cycle

Management and End of Life notice.

Alternative markets for product and

services.

Market Analysis and Regulatory Changes

26

Market analysis being

performed which will help

define the roadmap and to

concentrate and focus

development and business

efforts. At the same time,

we need to stay abreast of

regulatory changes.

Ongoing review and enhancement to current

platform.

Product Life Cycle



services.

Ongoing Review of Solutions

27



Ongoing review and

enhancement to current

platform through regular

client interactions to define

forward looking

functionality requirements.

Product Life Cycle



services.

Product Lifecycle Management

28




platform.

Product End of Life notice

sent December 31, 2009

for versions 3.60 and

earlier. Provide sufficient

lead time and information

to proactively plan for

EOL.


services.

Alternative Markets

29




platform.

Product Life Cycle


Alternative markets for

products and services in

Europe, Latin America,

Australia and beyond.

H1

Treasury Services Roadmap

H1 H1

2013 2012 2011

H1

2010

H2 H2 H2

FX RateHub w/Liquidity Providers

Dashboard v 2.0

Maintenance Release

Maintenance Release

Modernization Release

Maintenance Release

FX Sentry Back Office

Release

Maintenance Release

Maintenance Release

Enhancements Release

Enhancements Release

FX Order Book

FX Sentry / Object Charlie

Chapel WebFX / FX White Label ASP

FX RateHub

Future Products / Functionality

Maintenance Release

Multidealer Platform

Connectivity

Release

3.68

Release

3.69

H2

End of Life Object Charlie

Trader Platform

Rate Aggregator

FX RateHub Next Gen

FX Retail Branch

SOA i18N FX Options NDF

30

FX White Label ASP

Chapel WebFX FX Trader Platform

• Recent release which includes:

• Inbound liquidity provider

• Outbound rate publishing

• Dashboard

• Future:

• Rate Aggregator Screen

• Enhanced rules support

FX RateHub

• Offers complete FX trading

services to your downstream

clients.

• Support N-tier pricing, back-to-

back transactions and multi-level

customer relationship

management.

• Modernization of Chapel

WebFX with possible

enhancements/new features

such as:

• New look and feel

• Faster screen responses

• Payment driven workflow

• Live rates with execute

function

• New web trading style front

end.

• Full order book functionality.

• Streaming rate support.

• Capable of integrating with any

third party back office system

FX Product Suite

• Version 3.68 now available.

• Version 3.69 scheduled for 2H2011 with delivery of FX Sentry Back Office.

New and Upcoming Products and Solutions

31

Enhancing Treasury Services’ offerings with new products, services and solutions.

STRATEGIC PROJECTS FORWARD LOOKING

FX Sentry Back Office

Chapel WebFX Modernization

FX Order Book

FX Trader Platform

FX Mobile

Auto Nostro Transfer

Single Rate Agreement (SRA) Support

Data Archiving

SWAP Enhancements

Algorithmic Trading

Business Rules Engine for Settlements

IACH Support

All Rate Components in Interceptor

File Upload Enhancements

“CRM” Data Warehouse

Scenario Engine Enhancements

FX Sentry Enhanced GUI

Reporting Engine Update

SAML Security

32

Inside CorporateTreasury Foreign Exchange

Presenter: James Kessler (The Norman Group)

34

Why Is a Foreign Exchange Area Necessary?

• Provides visibility into foreign currency flows which can be used to mitigate FX risk.

• Expertise- Knowledge on how to execute/settle an FX contract and familiarity with strict guidelines on valuation of forward contracts.

• Consolidating trades can result in better rates. The result of this may be splitting of trade instructions to several beneficiaries.

35

FX Departmental Structure

• The FX department falls under corporate treasury and is usually structured in a similar fashion to other treasury areas.

• Centralized vs. Decentralized Treasury

• Centralized-FX trades executed from one location or regionally.

• Decentralized- FX trades are executed by individuals at the business unit level with local banks.

• Most corporate treasury departments will have one person responsible for trading. Confirmations and settlements handled by another treasury staff member due to Sarbanes-Oxley requirements.

36

Common Trade Types

• Spot Trade – The most common trade to buy/sell currency. Maturity within 1 to 3 days.

• Forward trade – an FX trade that has a maturity beyond a spot trade. Normally beyond 3 days.

• FX Option – an “option” to pay an upfront premium to buy/sell a currency at a certain rate at a certain point of time.

37

Spot Trade

• When a corporate is buying foreign currency with a spot trade is usually to pay an invoice in a foreign currency.

• Selling foreign currency is usually to sell off a receipt of a foreign currency to get back to the operating currency.

• Companies will accept foreign currencies for payment from customers to increase competitiveness in the marketplace.

38

Forward Trade

• Companies often use forwards to protect against future exchange rate fluctuation.

• Forward trades are quoted as spot + forward points.

EUR/USD Example:

Spot Rate Forward Points All-In Rate

1.423250 0.003850 1.427100

• Forward points are a calculation based on length of a forward contract and the difference in borrowing rates for the 2 currencies.

39

Other Types of Forward Trades

• Non-Deliverable Forwards (NDF) are forward trades using restricted currencies that settle in a non-restricted currency.

• Example: Canadian company based in China needs to pay local expenses in CNY. The trade would have an execution rate and a settlement date. The difference between the execution rate and the rate on the settlement date rate would be paid to/received from the bank.

• A Window Forward is a forward contract that can mature between two predetermined dates.

• Particularly useful when a large receivable in a foreign currency is due, but the exact delivery date is unknown. A common example would be a VAT refund denominated in a foreign currency.

40

FX Options

• An option is basically paying an upfront premium to buy/sell a currency at a certain rate at a certain point of time.

• Most companies tend to shy away from options as options often require an initial cash outlay to pay premiums and are difficult to account for.

• A reason to buy an option would be a pending acquisition of an overseas company. An option could be used to get a “no worse than” rate and allow for upside participation in favorable market movements.

41

Common FX Systems

• Systems such as FXPress/Reval are used to capture FX exposure information, store trade data and have documentation and reporting capabilities.

• Many banks offer their own FX trading platform to corporate clients. These systems often tie into other treasury products offerings.

• Some corporate FX departments prefer to use electronic trading platforms such as FXALL, Currenex, and 360T.

• Easy to use and can compare retrieve rates simultaneously.

• Relatively inexpensive and worthwhile if there are large trade volumes.

42

Why Use Several Banks To Trade FX?

• This is a good question. One would think the logical answer would be competition and receiving the best possible rate.

• Most corporate treasuries have FX trading policies in place. These policies may dictate trade volumes to certain banks.

• Trade volume for each bank are usually driven by a bank‟s level of participation in the credit facility.

Questions

43

TS FX Product Suite – Round Table (part 1)

Facilitator: Luc Poulette

FX Product Suite Round Table

45

Confidential

• Open and interactive discussion regarding Treasury Services‟ business solutions and service delivery. Purpose

• CGI TS developed a highly configurable FX product suite used by many US and Canadian banks.

• Our extensive knowledge and experience with treasury applications and our commitment to work and collaborate with you in achieving your business priorities.

Context

• Exchange of opinions and suggestions to inspire us to deliver the best products and services. Approach


Proposed Discussion on

• Front Office

• FX Rate Hub

• IT

• Web & White Label (Web Site & Mobile)

• Back Office

46

Confidential


Front Office

• Nostro Balance Management &Transfers

• FX Options

• SWAP to become Linked Outrights

47

Confidential


Nostro Balance Management &Transfers enhancements

• Facilitate Nostro Balance management.

• With one or many Nostro accounts.

• No need to run processes and reports.

• Nostro Position always available like Trading Position.

48

Confidential


FX Options • The buyer of an option acquires the right and not the obligation to buy or sell an underlying asset under

specific conditions in exchange for the payment of a premium. If the buyer chooses to exercise this right, the seller is obliged to sell or buy the asset at the agreed price. The buyer may choose not to exercise the right and let it expire.

• There are 4 types of participants: Buyers of calls, Sellers of calls, Buyers of puts, Sellers of puts.

• There are 4 styles of options.

• European - can be exercised only at the expiry date.

• American - can be exercised at any time up to and including the expiry date.

• Bermudan - can be exercised early but only on specific dates before or on expiry date.

• Asian - exercise price equal to the average price of the underlying asset.

• Categories of Options: Plain Vanilla, Exotic (Barrier options, Binary options).

• Option exercising process considerations .

• Process to generate a trade from underlying (Trader involvement).

• Monitoring of portfolio to identify option exercise.

• Option confirmation: SWIFT MT305 (Plain Vanilla), SWIFT MT306 (Exotic).

• Financial Accounting.

49

Confidential


SWAP to become Linked Outrights • Creation of a new Transaction type, Linked Outrights

• Linked Outrights are similar to Outrights in behavior but are priced like SWAPS

• Allow Split, update of near/far legs without impacting other legs.

50

Confidential


RateHub

• Rate Concentrator

• Liquidity provider in Trade Entry

51

Confidential


Rate Concentrator &/or Liquidity provider in Trade Entry

• New trade input feature of FX Sentry that leverage the multi-source capability of FX RateHub:

• Connect to liquidity providers streamed rate sources

• Display available rates from all sources in a single view

• Filter / Sort rates according to custom rules

• Allow fast transaction execution

52

Confidential


IT

• Crystal Reports v8.5 – Potential Migration Plan

• FX Sentry Scenario Editor Improvements

• Audit enhancements (Scenarios, Pipes)

53

Confidential


Web & White Label

• Trading application including FX Order Book

• Chapel Retail version

• File Upload enhancement

• Other

54

Confidential


Trading application including FX Order Book

• Provide FX Electronic Dealing Features to “Trader” end users which leverages FX RateHub, FX Sentry and Chapel WebFX.

24/7 Global Liquidity Provider Capability.

Enhanced Trader Dashboard Features.

One Click Dealing with Streaming Rates.

Ladder Displaying Liquidity Provider Rates.

Contribute to Outbound FX Rates to ECNs.

Post trades to Non CGI Front/Middle/Back Office Platforms.

Features to flow through to Chapel FX White Label.

55

Confidential


Trader Features.

i.e. Real-Time Order Book Blotter (Monitor, Update, De-Activate & Cancel Orders).

Auto Fill Capability in FX Sentry.

One Click Manual Trader Fill Available.

Order Capture in Chapel WebFX.

Credit Checking.

Multiple Order Types.

Market and Limit Orders.

Stop Losses, Take Profits and Trailing Stops.

Extend Capabilities via API.

Global Reach Capability.

Configurable Email Notification .

Flexible Spread Configuration.

Thin Client for Mobile Banking i.e. iPhone & Blackberry.

.

56

Confidential


Chapel FX Retail Branch version • Leverage current Chapel Web FX functionality by adding required

functions on top of the currently used

• Provide seamless integration between the required branch functionality and the Object Charlie product suite

• Design the new functions look and feel to match the target user base consisting of branch operators

• Ensure necessary performance to support the projected volume and the nature of the transactions, performed with facing customers

57

Confidential


Other

• How does other users:

• Have implemented Order Books

• Are accomplishing Bulking Deals (specifically for trust clients)

• Web Online Chat

• ABA Lookup and Validations

• Manual Entry of SWIFT IDs with Validations

• Template Configuration Screen Update

• Thin Client for Mobile Banking i.e. iPhone & Blackberry

58

Confidential


Back Office (Proposed Discussion Topics)

• Non-Deliverable Forwards (NDF)

• International ACH (IACH)

• MT103 Field 50K enhancement

• Other

59

Confidential


NDF - Non-Deliverable Forwards (CGIFX NDF Proposal v1 0 20090130.pdf)

• Static data definition

• Currency Cross Setup and Client Setup

• SSI (Standard Settlement Instruction) Setup

• Transaction Type and Trade Mode Definition

• NDF Trade Capture

• NDF Trading Screen

• NDF Rate Fixing

• Other

• Accounting, Portfolios, Client Limits

• Chapel NDFs

• Trade Capture

• Trade(s) Display

• Template Configuration

• Trade flow

60

Confidential


International ACH

• Inbound interface with IACH systems

• Standard Settlement Instructions (SSI) configurable for IACH payment type

• Customizable IACH outbound based on payment destination

61

Confidential


MT103 Field 50K enhancement(CGIFX Ordering Customer in MT103 Proposal v1.1 20090601.doc)

• Current Rules for Populating the Account Number – (50A & 50K Formats)

• Proposed Enhanced Rules for Formatting Field 50 • New Ordering Customer Box – ( 50A & 50K Formats)

• Rules for Populating the SWIFT BIC – (50A Format)

• Rules for Populating the 4 Lines of Full Name and Address (50K Format)

• Ordering Customer Conversion rules

62

Confidential


Other

• How can we achieve higher STP in the back office

63

Confidential

TS FX RateHub Client Presentation

Presenter: Robert Raymond (PNC)

Implementation of

Rate Hub

CGI’s Automated Liquidity Provider

At the beginning of the day, it’s all about vision.

At the end of the day, it’s all about the courage to execute it.

Interesting Facts

That musical greeting card has more computer power than existed in the entire world before 1950.

The average Quartz watch contains more computing power than existed in the entire world before 1960.

The average home video camera has more processing power than the original IBM 360 mainframe.

The average in-home video-game system now has more power than the original Cray supercomputer.

Such rapid and dramatic change implies that no organization can remain the same for long and survive.

Agenda

PNC Prior to the Rate Hub Implementation.

What PNC wanted to accomplish.

What PNC was looking for within a Liquidity Management Platform.

Key Benefits of CGI‟s Rate Hub.

Rate Hub Phase Zero.

Rate Hub Phase One.

Rate Hub Phase Two.

Rate Hub Phase Three.

Rate Hub Phase x.

Rate Hub Lessons Learned.

Rules Engine Proposed Enhancements.

Questions.

Before Rate Hub

Manual

Manual

PNC‟s Goal

Provide our customers with a cost

effective, fully integrated,

functionality-rich engine to execute

customer Foreign Exchange orders

via direct liquidity providers utilizing

the best available prices, according

to our own Business rules.

I never saw a person who could cram so small an

idea into so many words.” --Abraham Lincoln

What PNC was looking for within a

Liquidity Management Platform

Platform needed to be fully and seamlessly integrated

with Ocharlie, Chapel, and CGI‟s API‟s.

Wanted to select a Package in which we were not

charged fees - per trade booked.

Looked for a package with an unlimited number of

Liquidity API plug-ins.

Required a customizable Back-to-Back option to allow

PNC to assume the risk when desired.

Desired a sophisticated Rules engine that was

configurable by currency, time of day, preferred provider,

best-rate, etc.

Key Benefits of CGI‟s Rate Hub

PNC becomes more competitive by sourcing Market

Rates instead of Indicative Rates.

More robust rate sourcing, utilizing multiple rate

Providers.

Provides our clients with one-stop shopping for 23/7

dealing capabilities without the need for an overnight or

weekend desk.

Reduction in Currency Risk and Costs associated with

managing currencies.

Potential to enhance FX revenue.

No re-training or introduction of additional 3rd Party

software.

Rate Hub Phase Zero

Deliver Rate Hub as a stand-alone

component in 3.67 (not compatible with

Chapel, FX Sentry and the CGI API‟s.

One liquidity provider plug-in with Royal

Bank of Scotland (RBS).

No Dashboard.

One RFS publisher plug-in with FXALL,

with configurable Back to Back save

trade capabilities with RBS.

Rate Hub Phase Zero

Liquidity providers

Rate Hub The Deal

Module

The Pricing

Module

The Catalog Module

OCharlie

3.67

FX Server

Chapel

FX Sentry

Monitor

Rate Hub Phase One

Upgrade to 3.68 to leverage FX Rate Hub as

the single channel for rate publishing and

transaction execution from all sources at PNC

(FX Sentry, Chapel WebFX, and Chapel White

Label).

Add a second liquidity provider plug-in with

Deutsche.

Fully Functional Dashboard.

One RFS publisher plug-in with FXALL, with

configurable Back to Back save trade

capabilities with RBS and Deutsche.

Rate Hub Phase One

Liquidity providers

Rate Hub The Deal

Module

The Pricing

Module

The Catalog Module

OCharlie

3.68

FX Server

Chapel

FX Sentry

Dashboard

Rate Hub Phase Two

Publish RBS/Deutsche rates to

external Chapel Customers.

Supplement any Non-existent

Liquidity Provider rates with

indicative rates from Reuters/Tullets.

Extend the operating hour of Chapel

trading to 23/7.

Rate Hub Phase Two

Liquidity providers

Rate Hub The Deal

Module

The Pricing

Module

The Catalog Module

OCharlie

3.68

FX Server

Chapel

FX Sentry

Dashboard

Rate Hub Phase Three

Publish RBS/Deutsche rates

to CGI‟s API‟s (GetRate,

SaveTrade, Save at Market).

Extend the operating hour of

the API‟s to 23/7.

Rate Hub Phase Three

Liquidity providers

Rate Hub The Deal

Module

The Pricing

Module

The Catalog Module

OCharlie

3.68

FX Server

Chapel

FX Sentry

Dashboard

API‟s

Rate Hub Phase x Add a third liquidity provider plug-in with JP Morgan.

One RFS publisher plug-in with FXALL, with configurable Back to Back save trade capabilities with RBS, Deutsche and JP Morgan.

One RFS publisher plug-in with Bloomberg, with configurable Back to Back save trade capabilities with RBS, Deutsche and JP Morgan.

One RFS publisher plug-in with 360T, with configurable Back to Back save trade capabilities with RBS, Deutsche and JP Morgan.

Enhance the Rules engine.

Rate Hub Phase x

Liquidity providers

Rate Hub The Deal

Module

The Pricing

Module

The Catalog Module

OCharlie

3.68

FX Server

Chapel

FX Sentry

API‟s Dashboard

Rate Hub Lessons Learned

1. Banks internal Infrastructure adds Complexity to the Install.

Each Liquidity Provider may require a different Implementation.

Firewall rule changes will be required.

Make friends with your Web Hosting Group.

Consider additional Stress Testing prior to implementation.

Consider using ActiveMQ.

Test and Production environments are never the same.

2. Testing requires a large commitment from the Front Office.

3. The phased Implementation approach has many advantages.

4. Don‟t go live with a new Liquidity Provider the same day that the Liquidity Provider has an unplanned outage.

5. Consider having a CGI consultant on-site for 1st Day of the implementation.

Rate Hub Lessons Learned

6. Aoccdrnig to rscheearch at Cmabrigde Uinervtisy, it deosn't mttaer in waht oredr the ltteers in a wrod are, the olny iprmoetnt tihng is taht the frist and lsat ltteer be at the rghit pclae. The rset can be a toatl mses and Gleu can sitll raed it wouthit a porbelm.

7. Tihs is bcuseae the huamn mnid deos not raed ervey lteter by istlef, but the wrod as a wlohe.

8. Amzanig huh?

Rules Engine Proposed

Enhancements

Ability to setup unique rules by channel.

Ability to setup rules by USD equivalent amount.

Ability to setup back to back rules by Buy or Sell Currency.

Ability to setup Ad hoc rules.

Ability to set interceptor as a rate source.

Ability to chose Order or Back to Back trade.

Questions "This is not the end, it is not even the

beginning of the end. But, it is, perhaps the

end of the beginning."

– Winston Churchill

TS Wrap Up

Presenter: Steve Coronel

TS FX White Label Client Presentation

Presenter: Harriet Gilbert (US Bank)

Addressing a Product Need

92

Voice of our bankers and clients

• Our Financial Institution RMs were asking:

• “How can I sell FX services to my clients?”

• “How can I compete with other banks offering an FX White Label platform?”

• Our Financial Institution clients were asking:

• “How can I service my clients who are asking for FX on their desktops?”

• “How can I grow my FX revenue with limited investment dollars as I can‟t justify the infrastructure expense?”

• “How can I get transparency into the true risks and value of my FX business?”

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Voice of our bankers and clients

• The answer was simple: • We needed an FX white label solution that was an

extension of our FX business. • Client need was growing

• Quick time to market was a must

• Seamless integration was key

• Our solution was the FX White Label API • Majority of CGI infrastructure already in place

• Functionality and architecture learning curve was minimal

• Off the shelf product met the majority of our business requirements

• Allowed for shortened implementation timeline

Project Considerations

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Configuration and Branding

• Level of custom branding • The more customizable branding, the harder to maintain

and extends on-boarding and implementation time

• Extent of static data configurations • Downstream banks‟ level of sophistication

• Downstream banks‟ clients level of need

• Settlement validations required to ensure proper processing

• Simplicity around pricing sets and settlement instructions will make training and support easier

• Location of underlying control • Hours of availability

• Control of dealing parameters –spot and/or forwards

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Post Trade Requirements

• Work Queues • Determine the appropriate work flow that is intuitive for

your clients but gives you a level of control

• Determine what functionality you want your downstream banks to own

• To what extent will you enable on-site draft printing capabilities • Minor customization may be needed on your side to ensure MT110 has the

correct downstream draft number

• Will you require your banks to perform OFAC checking prior to releasing deals to you

• Reports and Views • Client facing reports to manage daily work flow and

required audit trails

• Internal reports for management and risk reporting • Revenue

• Limit exposure

• OFAC extract

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System Support, Administration, and Security

• Consider who will provide each level of support • Who will have direct contact with your downstream bank

client and their clients? • What visibility will you have or do you want into each downstream

bank instance?

• Chinese walls between you, your clients and your clients‟ clients may restrict how much you do or see.

• Administration configuration may dictate who can administer system users

• What multi-factor authentication policy will your downstream banks employ • Will shared secrets (ie layered security) suffice or should

you look to also implement token authentication

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System Integration

• Communication between your bank and CGI • Two communication protocols will be required

• API calls used to get rates and to save deals with your bank

• MQ connection used for the transmission of the settlement instructions and other static data

• VPN Tunnel • Provides a secure connection between your bank and CGI

• Firewall configuration • Ensure firewall requirements are fully vetted prior to

implementation

• Ensure API is documented to avoid issues if firewall configuration changes

• IBM WebSphere MQ Series

• MQ SSL Certificates

• Disaster Recovery • Test connectivity between CGI and your DR site and also between

CGI‟s DR site and your primary site

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Other Integration Considerations

• Reconciliation between your white label platform and your system of record • Daily mechanism to validate deal status

• Valid deals

• Canceled deals

• Amended deals

• Static data synchronization • Daily transmission of revaluation rates

• Daily transmission of holiday calendar

• Monthly transmission of BIC/SWIFT data • Ensure your SWIFT license agreement allows for distribution

information to your clients through your CGI hosted application • May require the addition of a SWIFT Hosted Directories

Agreement

Post Implementation

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Lessons Learned

• On-boarding even the most anxious clients takes time

• Internal approvals for adding a new system are vast

• Legal documentation is detailed

• Clients have a varying degree of needs and expertise

• Ensure project timeline allows enough time for configuration and testing of communication between your bank and CGI

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Future Enhancements

• Evaluate which enhancements will have the biggest client impact

• One size does not fit all

• Each bank will have their own wants and needs based on how they process their business

• Consider new regulatory requirements and how they may impact downstream financial institutions

• What pieces of Dodd Frank will need to be cascaded down

• What other changes may be on the horizon

Questions

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TS FX Sentry Demonstration

Presenters: Qing Chen & Gelu Duplenschi

FX Product Suite – Back Office High lights

• Consistent “Look & Feel” of FO / BO screens

• Quick glance on Financial and SI information

• New action icons

• Additional buttons

• Trade History

• Settlement History

• Pool Details

• SWIFT BIC Look up

Confidential


• Easy access to Settlement Messages Screen

• Confirmation popup with comments prior to removing/adding user checks

• Additional button – View outbound

• Build-in Back office Views

• Transaction Query

• Transaction Not confirmed (Bank & Corp)

• Transaction Confirmed

• Trade/Pool – Missing SI (Within Spot)

• Settlement Instructions (Not sent or In Error)

• Cancellation Messages (Not sent)

• User Check - Confirmed

Confidential


• Build-in Back office Views (cont…)

• Transaction Not Matched

• Outbound SWIFT 300

• Inbound SWIFT 300

• Manual Inbound SWIFT 300

Confidential


• Bilateral/Multilateral Netting Work Queues

• Built-in Trade/Pool View with run time parameters;

• Net, Unnet, Backoffice and Pool Backoffice buttons.

• Pool Query

• Built-in Bilateral/Multilateral Pool View with run time parameters;

• Open/Close Pool, Pool Details and Backoffice buttons.

• SWIFT BIC screen

• Contains data uploaded from SWIFT BIC file;

• Search parameters: BIC/Bank name, City and Country;

Confidential

TS FX Product Suite – Round Table (part 2)

Facilitator: Luc Poulette

TS FX Product Suite „Must Haves‟ Products Services & Solutions

Presenter: Joe Soares

Dodd-Frank Legislation – Reporting Impacts

• Final rules by the July 15, 2011

• Requires that swaps (includes forwards and swaps) be cleared through a derivative clearing organization

• Exception for “end-user” from the clearing requirement if:

• One party to the swap is not a financial entity

• Is using swaps to hedge or mitigate risk

• Notifies the CFTC how it (the customer) “generally meets its financial obligations associated with entering into non-cleared swaps”

• Requires customer to provide evidence to its counterparty that it qualifies for the end user exemption

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Dodd-Frank Proposed Reporting Rules (real-time)

• Asset class of the security-based swap

• Information about the underlying security

• Price

• Notional amount

• Time of execution

• Effective date

• Scheduled termination date

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Dodd-Frank Proposed Reporting Rules (non real-time)

• Counterparty

• Broker

• Trader and desk ID

• Amounts of any up-front payments and description of the terms of the payment streams

• Title of any master agreement governing the transaction

• Data elements needed to determine the market value of the transaction

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Web Trader Platform with Order Book

• Development of trading screens for professional users outlining bid and offer in a ladder format indicating most advantageous prices by liquidity provider

• Extending this streaming rate approach to online clients while retaining the anonymity of the originator of the quotes

• This new trader oriented GUI for the more sophisticated client - Day Traders, Hedge Funds Managers, etc.

• A requirement for the European market

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• Automated functionality allowing banks to manage client orders:

• Buy/sell currencies at a given price (limit orders)

• Immediate purchase (market orders)

• Protecting currency exposures for hedging and speculative purposes (stop loss orders)

• Plus: OCO, If Done, Take Profits, etc.

• Leverages FX RateHub by automating trade execution on a real-time basis:

• This will enable the CGI FX Product Suite to cover the full cycle from client order to execution by banks own FX traders

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• Development of specialized screens outlining outstanding orders in a format by client and/or currency indicating order size, priority and proximity to being filled

• CGI contains 80 percent of what these banks need to complete the task

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FX Retail Branch

• Offer foreign exchange services through your retail branch network

• Connect your branches directly to the bank's FX operations

• Leverage current Chapel WebFX functionality by adding required functions

• Provide seamless integration between the required branch functionality and the FX Product Suite

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FX Retail Branch Potential Feature List

• Traveller‟s Cheques (sell & buy)

• Drafts (including support for MT110)

• International Wires

• Bank Notes (sell & buy)

• Currency Deposit (cheques)

• Account Transfers (e.g. DDA to MCA)

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FX Mobile

• Mobile corporate banking is still in its infancy

• Has been a mid-level IT priority for most banks over the last few years

• It is slowly rising in the ranks as banks struggle to identify new ways to retain customers and improve customer satisfaction post-financial crisis

• To date, mobile banking capabilities have been offered primarily to retail/consumer customers

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FX Mobile

• Aite Group October 2010 bank customer survey shows interest in mobile apps:

• 65% of businesses are interested in using basic mobile corporate banking services

• 56% interested in more advanced functions such as approving transactions and approving payments

• Advanced mobile functions are “stickier” than basic balance inquiries:

• Greater retention value and more opportunities for cross-selling

• Stronger justification for additional service fees

• Banks must overcome concerns about security

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Auto Nostro Transfer v2.0

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• Minimum and maximum balance can be specified

• Accounts tagged for inclusion in the process will have a “main” account linked to fund from/to

• Calculations based on a new Nostro Projection table that will store the Nostro accounts starting daily balances and the intraday activity

• A transfer transaction is created (via a pipe) with the appropriate matrix to each payment side using preconfigured standard sets

• Execution at any point during daily operations or for inclusion in end-of-day or start-of-day batch jobs

NDF Trade Capture

• Currency Cross enhancement with indicator for each currency pair for NDF eligibility

• A new Applicable Transaction toggle for “NDF” in the Client Setup screen

• “NDF Pricing Set” added to the Client Setup to be used for calculating the proposed rate

• New NDF Trade Capture Screen

• Two new Trade Modes created:

• NDF - Rate to be Fixed

• NDF - Rate Fixed

• Separate entry for NDF Fixing will be added to the Front Office menu (similar to Bulk Pricing)

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Other Forward Looking Functionalities

Single Rate Agreement (SRA) Support

Data Archiving

SWAP Enhancements

Algorithmic Trading

Business Rules Engine for Settlements

IACH Support

All Rate Components in Interceptor

File Upload Enhancements

“CRM” Data Warehouse

Scenario Engine Enhancements

FX Sentry Enhanced GUI

Reporting Engine Update

SAML Security

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Questions

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Conclusion

Presenter: Bill Lovering


Our commitment to you CGI provides the best mix of responsive local service at global delivery value.

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