Loans Management ECC 6.0 OSER 16.01

Loans Management with SAP

Joerg Oser

Business Solution ArchitectGlobal Banking Line of Business

Bensheim, 16th January 2008

Customer Base

Functional Overview

Introduction Loans Management

AGENDA

Conclusion

Agenda

© SAP 2007 /

Customer Base


Functional Overview

SAP Loans Management

Conclusion

SAP Loans Software History - Customers

2000 - 20021991/2 1995 1997 2005

LoansManagement

C ore Banking

M ortgage

L oansTR easury

LO ans

IS – IS

Darwin

700 Customer

s

New:Consumer-

Loans

2007

L O A N S - Management

SAP® for Banking

© SAP 2007 / Slide 5

SAP Analytical Banking

SAP ERPSAP Transactional Banking

Loans

Deposits

Co

llat

eral

s

Leasing

Pay

men

ts

Customer Information

Syn

dic

ati

on

s

Customer Relationship Management

Master Contract Management

Financials

Human Resources

Procurement

Corporate Services

Regulatory ReportingRisk Profitability Accounting

Produce banking products and manage customer interactions

Run the organization

Understand analyze and decide

SAP® for Banking



Loans

Deposits

Leasing

Pay

men

ts

Syn

dic

ati

on

s



Financials

Human Resources

Procurement

Corporate Services


© SAP 2007 /

Co

llate

rals


Common Product Enablers

© SAP 2007 / Slide 8

Common real-time solution for retail, commercial and corporate banking

Multi-currency and cross-currency

Multi-language user interfaces and correspondence languages

Multi-channel with equal access to processes and data

Multi-bank, multi-entity, multi-business unit, multi-label

Multi-country, cross-border

Multi-time zone with specific scheduling of cut-off time

Real-time 24x365 access and High Availability architecture

Scalable solution for both small and large banks (ratio volume : sizing)

Process definition through parameterization

SAP Transactional Banking

Loans

Deposits

Col

late

rals

Leasing

Pay

men

ts


Syn

dica

tions



100+ banks 60+ insurance companies 700+ customers

Banks in different areas: retail, wholesale, universal banks, real estate banks, credit factories, specialised banks

Renowned banks all over theworld (in Americas, across

Europe, Africa, Asia)

SAP Financing Customers - examples

SAP Loans Customers 2007

280330

400434 459 479 504

538 558589

623

0

100

200

300

400

500

600

700

Dec 0

0

Mär

z01

Juni-

01

Sep 0

1

Dezem

ber-0

1

Mär

z-02

Juni-

02

Sep

02

Dezem

ber-0

2

Mär

z-03

Juni-

03

Sep 0

3

Dezem

ber-0

3

Dez

04

Dez

05

2007: over 700

Integration SAP Loans Management

Loans Management

Collaterals ManagementGuarantees

CMS

Financial Accounting Legal ReportingAnalytics

SAP – Business PartnerCIM

Fro

nte

nd

/ G

ui

DataWarehous

e

Corres-pondence

Securisation

ABSAsset

Backed Securitie

s

Agenda

© SAP 2007 / Page 12

Customer Base

Functional Overview



Conclusion

SAP® Loans Management - Products

SAP Loans Management is a functionally comprehensive module for the mapping of different kind of loans (secured and unsecured) such as

Personal Loans (e.g. installment loans)

Corporate Loans including senior loans, junior loans, mezzanine loans.

Mortgage Loans such as fixed and variable rate, equity release

Special Loans (policy loans, employee loans etc.)

Business Process: Product Setup

Definition of loan products:

Definition of loan products:

Product

Conditions

Comprehensive product specific parameters

Flexible condition concept

Product Configurator

One Solution for Customers with Different Business

Real Estate

Consumer Loans

Universal Bank

Credit Factory

Corporate Financing

Specialised

Project Financing

© SAP 2007 / Page 16

http://www.bhw.de/


• Business Partner• Contract creation• Conditions• Collateral /Objects

• Disbursement• Integration Financial Accounting and

Cash Mgmt• Correspondence

• Payment transactions• Incoming payment post-processing• Transfer postings• Reversal• Dunning / Interest on arrears• Accruals/deferrals

• Rollover • Borrower change• Payoff/ unscheduled repayment • Waiver• Parallel valuations• Archiving• Reports

Customer Request

Contract Conclusion

Contract Disbursement

Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

© SAP 2007 / Page 18

Portfolio

Collection

Execution

New Business


• Business Partner• Contract creation• Conditions• Collateral /Objects

Customer Request

Contract Conclusion


Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

New Business

© SAP 2007 / Page 19

SAP Customer Information File as Central Anchor

Proven solution with more than 100 banking customers

Comprehensive and Centralized

Customer Data

Distribution to and from Other Systems

Enhancement of Data and Screen

Design

Central Address Management

Management of Relationships

Role Concept

© SAP 2007 / Page 21

Partner Hierarchy

Nordic TradingBP: 50292

Loan: 10001656

Trondheim TechnologyBP: 133

Loan: 10001708

Bergen ShippingBP: 132

Loan: 10001702

Trondheim SecuritiesBP: 50313

Loan: 10001710

Trondheim Computer ChipsBP: 50312

Loan: 10001709

Oslo ElectronicBP: 131

Loan: 10001701

Business Partner: Relation Ships

Business Partner: Total Commitment

Total Commitment

SAP

SAP

non SAP

SAP

SAP

SAP

View of all the business with the customer

Possibility to take into regard customer entitities (holding etc)

Configurable layout

Loans-ContractSAP-Loans

Business Partner

Correspon-dence

Product

CollateralsGuarantees

Basic Data

Contract: Master Data - overview

Conditions

Percentage of defined base amounts

Fixed amounts

Proportionally per disbursement

Total amount with first or final partial disbursement

Commitment interest / charges Discount / premium calculation

Repayment forms

Installment repayment

Annuity repayment

Maturity repayment

Fixed Interest

Variable Interest

Formula-based interest

Interest calculation

Conditions and Structuring - Overview

© SAP 2007 / Page 29

Fixed Interest Periodfrom 10.01.YY

09.30.YY

Fixed Interest Periodfrom 10.01.YY

09.30.YY

Charges from10.01.YY 50 €

Repaymentfrom 10.01.YY1150 €

. . . Condition header

Condition items

Interestfrom 10.01.YY5.5%

Loanbasic data

Condition header

Cash flow

Conditionitems

-----------------------------

Master dataLoan contract

Interestfrom 10.01.YY 5%

Calculate effective interest

Calculate payment

plan

Condition Concept

Planned records

© SAP 2007 / Page 30

Cash Flow

© SAP 2007 / Page 31

New Business: Highlights

© SAP 2007 / Page 32

Comprehensive master data

Powerful condition features

Integrated functions for

Customer Management

Collateral Management

Account Origination

SAP® for Banking



Loans

Deposits

Co

llat

eral

s

Leasing

Pay

men

ts


Syn

dic

ati

on

s



Financials

Human Resources

Procurement

Corporate Services


© SAP 2007 / Page 33

Collateral Management System

ReportingCentral

document management

Statutory reporting / risk mgmt

Communi-cation system


Real estate

Movable property(incl. ship, car)

Security Account

…

Collateral object management

Collateral management

Asset value

Collateral agreement

Receivables

Transaction management

Loans

Other financing

Current accounts

Trading transactions

Guarantees

Inventory

Object Bundle

Other

…

Rights (incl. patents,

insurance)

© SAP 2007 / Page 34

Some SAP Collateral Management Customers

Example Reporting: Customer – Collateral Overview

Branch to transaction

Collateral given

Secured transactions

Details

“At a glance”: free collateral, collateral shortfalls etc


Business PartnerContract creationConditionsCollateral /Objects

DisbursementIntegration Financial Accounting and

Cash MgmtCorrespondence

Customer Request

Contract Conclusion


Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

Execution

New Business

© SAP 2007 / Page 37

Payment Processing

Outgoing Payments Partial disbursements possible Deductions Gross – net Future preposting capability Automatic generation of outgoing payments

To borrower

To third party, such as property developer

Flexibly definable payment details

© SAP 2007 / Page 38

Integration LOANS with SAP FI – Financial Accounting

Loan Contract: Cash-flow01.05.JJ 150.000,00 Loan Disbursement 0001 0001

30.06.JJ 1.720,83 Interest debit position 0110 0110

30.06.JJ 639,05 Amortisation 01250125

FI-Schnittstelle

Financial Accounting

Amortisation-Receivable

Interest-Receivable

Other Incomes

Depreciation Deferments

Realtime Postingof flows

FI-Interface

automatically

© SAP 2007 / Page 40

Mass run

Correspondence

Standardized Correspondence

Single run

Individual Correspondence

Correspondence

Example Partner Solution for Output ManagementSTREAMSERVE: SAP Certifications since 1998

Raw Data Interface (BC-RDI)

SAP Smart Forms (BC-XSF)

IDOC ALE Converter (CA-ALE)

Assured device delivery (XOM)

BAPI Integration

Powered by SAP® NetWeaver

SAP-endorsed business solution

A long time SAP® Software Partner, StreamServe has attained multiple SAP® certifications, which ensure seamless connectivity with SAP® business solutions.

Leveraging Financial Statements To Increase Loyalty

Summary and Detail information for Checking, Savings, Investments, Loan/Mortgage, Insurance, etc.

Dynamic, personal message content

from nearest branch manager specific to customer’s account

Dynamic, segmentedUp-Selling messages

SegmentedCross-Selling

messages

Dynamic lease and loans branding

”prior to using StreamServe for communications on customer correspondence we had a 25% customer turnover rate; today it is estimated to be less than 5%.“

Mortgage Statement Embedded Offers

Cross-Sell and Up-sell Messaging

Execution: Highlights

© SAP 2007 / Page 51

Fully integrated accounting

Rich disbursement features including payments to several parties, partial payments

Plausibility checks

Flexibly definable correspondence or usage of external correspondence tool





Payment transactionsIncoming payment post-processingTransfer postingsReversalDunning / Interest on arrearsAccruals/deferrals

Customer Request

Contract Conclusion


Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

© SAP 2007 / Page 52

Collection

Execution

New Business

Payment Processing

Incoming payments Several payment media such as direct debit or bank transfer

Creation of over- and underpayments

Post processing features

Flexibly definable payment details

Outgoing Payments Partial disbursements possible Deductions Gross – net Future preposting capability Automatic generation of outgoing payments

To borrower

To third party, such as property developer

© SAP 2007 / Page 53

Incoming payment

No Incoming payment

For example, auto debit,bank transfer, etc.

Contract Receivables

1,500


1,5001,500


1,500


1,50015

Payments Due

Clearing ofReceivable

Due Payments

Dunning/Interest on Arrears

DunningLetter

Dunning/Arrears List

© SAP 2007 / Page 54

Incoming Payment Processing and Dunning

SAP Loans Back Office: Highlights

© SAP 2007 / Page 55

Rich functional support of rule defined payment allocation

Fully fledged post processing of incoming payments

Support of follow-up activities including dunning






Rollover Borrower changePayoff/ unscheduled repayment WaiverParallel valuationsArchivingReports

Customer Request

Contract Conclusion


Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

© SAP 2007 / Page 56

Portfolio

Collection

Execution

New Business

Loan Business Activities

Examples: Payoff / unscheduled repayment

(full and partial payoffs) Charges Single postings Borrower change Capital transfer Deferrals, waivers

Application: Structured, user-friendly entry of business

activities Status management of business operations Reversal function Release function

© SAP 2007 / Page 57






Rollover Borrower changePayoff/ unscheduled repayment WaiverParallel valuationsArchivingReports

Customer Request

Contract Conclusion


Accounting

Contract Processing

Contract Default

Contract Closing

Contract Analysis

Portfolio

Collection

Execution

New Business

© SAP 2007 / Page 59

Release

Release

Release

Use

r Aut

horiz

atio

ns

Release Procedure in SAP Loans

Release control:

Release can be set up using the control parameters company code, product type, contract status, threshold value and currency

Double, treble or quadruple release control can be implemented

The release procedure in SAP

Loans is

supported by SAP Workflow

SAP Loans: Reporting

Standard reports

Drilldown Reporting

QueriesSAP

Business Warehouse

Other Reporting Systems

Mature technology makes it possible to easily fulfil specific information demands via adapting existing queries as well as creating new ones.

SAP Loans is fully integrated with the SAP Business Warehouse.SAP Business Warehouse includes standard content for Loans information.The SAP Business Warehouse allows flexible reporting including cross-reporting.

Rich features in order to create easily new reports via configuration.The reports can be defined ad-hoc with drilldown functionality, in list form or in graphical form

A large set of reports delivered with the systems covering areas such as position, workflow control, balance information, revenue analysis, accounting, commitments

SAP Loans offers an interface in order to feed data to other external systems such as risk systems.

Examples

© SAP 2007 / Page 61

SAP Loans Standard Reporting

SAP Reporting: Export to MS-Office

Customers worldwide

mySAP Banking-Solutions More than 350 Implementations In over 20 countries

mySAP Banking-Solutions More than 350 Implementations In over 20 countries

Implementations of SAP Loans More than 700 Implementations In over 50 countries

Implementations of SAP Loans More than 700 Implementations In over 50 countries

Loans-Banking Customers Increase of Customers

ca. 25% p.a. 40 of the most imortant german

Banks Famous Banks in America,

Europe, Asia, Afrika

Loans-Banking Customers Increase of Customers

ca. 25% p.a. 40 of the most imortant german

Banks Famous Banks in America,

Europe, Asia, Afrika

LOANS – Customers Examples

http://www.bhw.de/

SAP® Loans Management – Deutsche Postbank AG

Implementation Highlight 25 million accounts (loans, deposits, checking)

Key Benefits Significantly reduced IT costs

Replacement of 14 legacy system with 1 SAP system

Process and system complexity reduced by 80%

Day-end processes 2x faster

Post-processing efficiency increased by 30%

New products within a few weeks

© SAP 2007 / Page 68

QUICK FACTS

Deutsche Postbank AG

Location: Germany

Industry: Banking

Products and services: Retail business and corporate banking

Revenue: €190 billion (2006)

Employees: 22,000

Customers: 15,5 million

Solutions and Services: Applications from SAP for Banking solution portfolio, including SAP® Loans Management, SAP Basel II, and SAP Deposits Management; SAP MaxAttention™ support option; SAP NetWeaver

“With SAP solutions, we aim to achieve

the lowest processing costs and

fastest time to market in retail

banking.”

Dirk Berensmann,CIO and COODeutsche Postbank AG

SAP® For Banking – HSH Nordbank

Key Factors Integration of new applications in existing architecture

of crucial importance

Reduced expense for development and production

Increased implementation of standard software

Increasing core competence of IT department

- Support of technical departments

- IT architecture

- Project management

© SAP 2007 / Page 71

QUICK FACTS

HSH Nordbank

is a strong commercial bank in its core region of Northern Europe

Location: Hamburg

Industry: Banking

Products and services: the leading provider of financial services in the transport sector and the world’s largest provider of ship finance, market leader in the corporate customer segment, real estate

Employees: 4,431 (2006)

Branches: represented in 17 foreign locations in the Baltic Sea region, South-East Asia and in the key international financial centers of New York, London and Luxembourg

Revenue: EUR billion 189 (2006)

SAP® Solution and Services: SAP Loans, CMS, BCA, SAP BP, SEM Banking

SAP® For Banking – DG HYP

Results

15% to 20% reduction in it operating costs expected

20% reduction in processing times expected in retail area

Complete mapping of all commercial products in the standard system Reduction of maintenance

costs

Improvement in data quality

Easier introduction of new commercial products

Clearer mapping of data and group structures in the sap financial customer information management application, a central business partner module

© SAP 2007 / Page 72

QUICK FACTS

DG HYP

is the largest real estate bank within the German cooperative banking sector

Location: Hamburg

Industry: Banking

Products and services: the provide finance for residential and commercial real estate, extend loans to local authorities, securitize credit risks and issue Pfandbriefe (asset-covered bonds)

Revenue: EUR 85.7 bn (2006)

Nationwide market presence: 1,250 cooperative banks with about 12,500 local branches

Employees: 594 (2006)

Number of customers: 220,000

SAP® Solution and Services: SAP for Banking, including SAP Financial Customer Information Management

Since implementing SAP for Banking solutions for its commercial loan business, DG HYP has increased data quality, reduced IT costs, and set up a technology base for fast introduction of new products.

SAP® For Banking - DZ Bank

Implementation Highlights

One of the largest SAP Loans Management projects in terms of scale and data volume

Reliable data processing at peak times

Key Benefits

Faster processing of credit data: four hours instead of three days

Excellent operational reliability

Single account view for subsidized loans

© SAP 2007 / Page 73

QUICK FACTS

DZ Bank

is the fifth largest bank in Germany is the central bank for 1,100 Volksbanken

and Raiffeisenbanken and is a Verbund-oriented commercial bank in Germany and abroad

Location: Frankfurt am Main Industry: Banking Products and services: has a strong

position in one-stop financial services Revenue: $m 574,750 (2006) Nationwide market presence: 1,250

cooperative banks with about 12,500 local branches

Employees: 24,154 employees (2006) SAP® Solution and Services: SAP for

Banking

“The integrated set of solutions, SAP

for Banking, offers us the level of

reliability we need for processing our

one million credit agreements.”

Manfred SalberHead of Credit ManagementDZ BANK AG

Key capabilities Easy configuration of new products

Open items handling

Automated processes (e.g. approval of data)

Mass processing features

Business rules driven automated collections processing

Multi currency, multi language, multi client features

Business process cost reduction through standardization and automation

Reduced IT operations costs through reduced interface maintenance efforts

Higher transparency and information quality

Accelerated time to market for new products1

Up to 30% reduction of IT development and change costs with SAP NetWeaver*

2

3

4

5

SAP Value Proposition Loans Management

Value impact

Source: SAP Projects*) Expert Estimation

© SAP 2007 / Page 78

Thank you!

Joerg Oser

Global Banking Line of BusinessSAP AGHeadquartersD – 69190 Walldorf / Germany

T +49/6227/7-609 52

[email protected]

http://www.sap.com/

Loans Management ECC 6.0 OSER 16.01

Documents

Transcript of Loans Management ECC 6.0 OSER 16.01