Viewing all reports

This page presents a chronological list of all the reports released on Howbankswork.com to date.

Click here to view reports by alphabetical order

November

Banks have been making IT Changes rather unsuccessfully recently.  This article suggests there is a pattern with root causes and concludes that Banks will have to change their change implementation strategies in the near future to avoid worse failures.

May

This article describes how Investment and Retail Banks are connected.

This article describes how a separation might be achieved in systems and operations terms to support the Independent Banking Commission’s recent reforms and the Financial Stability Boards’ “Living Wills” requirements.

August

This article discusses banking disintegration, focussing on the various complexities arising from the partial divestment of RBS branches to the Santander Group. The specific problems of divestment might spawn a new IT service industry.

Read on to find out more about Banking disintegration.

December

UK Banks are under increasing pressure from a range of external stakeholders to clarify the real value and nature of their assets. There are many aspects of banking and its operations that complicate a Bank’s reaction to this pressure.

Read on to find out about the the way in which the Banks have reacted so far, as well as the core issues and solution...

July

This article covers what has happened to Interbank markets over the last 6 months, why this has happened and the expected impact on IT and Operations.

There are two main areas of change as a result of the credit crunch for IT and Operations;

• Stop / Run down programmes
• New MI based on Capital

These are discussed further in the article.

This Appendix highlights why Banks lend to each other and the three means that are used;

• Money Market Loan and Deposits
• Syndicated Loans and Loan Markets
• Securitisation and CDOs

These mechanisms, whist technically independent are not completely so. If for some reason banks are unwilling to lend to a particular banking organisation it is probably because they do not believe that organisation’s loans to its customers are very good. Hence trying to sell these loans via Syndicated Lending or Securitisation may not be fruitful either.

April

This article covers the RBS challenge in integrating ABN Amro in so far as it describes the necessary stages of the ABN separation project and the RBS integration project.

• The RBS ABN Amro Challenge

Moreover, there will be a high level portrait of how an investment bank works, the Core Trading Business Model, and a representation of the Investment Bank Structural Overlay, that conveys the essence of complexity relevant to the core trading engine.

• The Anatomy of an Investment Bank

August

Payment Services Directive - PSD

The Payment Services Directive (PSD) has not received anything like the media air time that SEPA has but for a UK bank it is actually a more important set of changes. Over time it will:

• Force banks to remove “float” from their payment systems (e.g. Standing Orders, Credit card payments).
• Reduce foreign payment complaints and refunds
• Cause them to change their foreign exchange processes
• Create more competition for payment services, both domestic and international.

All good reasons to read this article and the legislation carefully. The article is broken into the following sections:

• PSD - Definition, Mechanism and Scope
• PSD - Impact on Competition and Changes to Pricing
• PSD - Value Dates and Cycle Times
• PSD - Refunds and Complaints
• PSD - So What Do Banks Have To Do?

January

New Rules for the Cheque Clearing System

The Government has announced changes that have to be made by end 2007 to the cheque clearing system.

1. An explanation of the Government Changes and an explanation of how these impact Clearing Bank and non-Clearing Bank cheque processes. (This assumes a knowledge of the cheque clearing processes)

2. For those who are not familiar with the UK Cheque clearing processes we have created two further reports that explain the current UK cheque clearing processes.

• UK Cheque Clearing for Clearing Banks (the thirteen or so banks that form the backbone of the UK cheque clearing service)
• UK Cheque Clearing for non-Clearing Banks (a.k.a. Agency Banks, the 400+ banks and building societies that use the Clearing Banks to process their cheques)

November

SEPA - Single European Payments Area

SEPA is just for European banks, right? Wrong! UK banks have to do quite a lot. Find out what...

What is a merchant Acquirer?

Under what is called the SEPA Cards Framework (SCF) there is a drive to standardise the interface between Merchants and Merchant Acquirer (click here for an explanation of what a merchant acquirer is).

July

Development of IT Security: This article consists of two parts:

• The first gives historical description of why the IT security world is the way it is during 1970 , 1980 , 1990 , 2003 , 2005 - Today.
• The second part of the article discusses and forecasts The Likely Changes to IT Security in the Next Two Years.

February

Syndicated Lending (Loan Markets): This article is broken down into four parts

• Customer Problem and Banking Solution. (To understand what customer problem syndicated lending solves)

• How Loan Markets Work (A description of the roles and activities of the different players in the Syndicated Lending)

• What are Loan Markets like? (A comparison of the Loan Markets versus other capital markets)

• Trends in Loan Markets (An outline of the trends in Loan Markets and what is causing IT investments in the area)

Most people understand the ideas behind retail bank lending (such as house mortgages or overdrafts) from personal experience. The currently booming world of syndicated lending and loan markets is much more opaque. The purpose of this paper is to open this up. It explains how it works and some of the trends taking place; in particular why banks are currently investing in IT projects in the back offices of their syndicated loans departments.

September

Development of Payment Systems within Banks

The new industry driven real time payments for internet banking, telephone banking and standing orders will cause banks’ IT departments to re-engineer their core banking systems. This will be a major area of systems development over the next few years and this article describes the impacts by systems area.

June

Economics of cross-border bank systems integration

In this article we explore the main areas of cost difference between a cross border integration and a within country integration.

February

Report 9.1: What it the Sarbanes-Oxley Act?

In this article we explain what the Sarbanes-Oxley act involves, why it was introduced and who it affects within the bank.

Report 9.2: How do banks make their money?

In this article we analyse the two main forms banks use to make their income.

Report 9.3: Accounting in banks

This article aims to give its reader an idea of how bank accounting works and who uses it. We also give examples of yearly produced reports; the P&L, the balance sheet and the cash flow statement.

November

Report 7.1: How Can We Make Substantial Cost Reductions to Europe's Payments?

With Europe's hundreds of banks collectively knit together, one would expect the European Payments system to be fundamentally efficient. However, this is not the case.Our report investigates why this is the case and considers how cost savings can be made, paving the way for substantial economic growth.

Report 8.1: The Outsourcer's view - An Interview with Unisys

To accompany the above report ( Substantial Cost Reductions to Europe's Payments), Howbankswork.com held an interview with Mike Eaton and Gerry Heard of Unisys, to gain an alternative perspective on outsourcing.

August

Report 6.1: The Evolution of Banking Systems

This report maps the history of the development of new banking systems accounting for new technologies and banking services.

July

Report 5.1: Why are the AD Departments of big banks so unproductive and what can business managers do about it?

This report considers the unproductivity of the Applications Development departments of big banks and suggests how this can be overcome.

January

Report 4.1: Risk Assessment and IT Investment

This report highlights an alternative way of considering how the IT Investment Budget is allocated.

December

Report 3.1: How Might Mobile Payments Work?

This report outlines how mobile payments are working and/or are likely to work, relative to Person to Person and Person to Merchant payments.

Report 3.2: Reasons Why a Bank Could Want Mobile Payments

This report outlines the reasons why a bank could want to invest in the mobile payment technology.

August

How much are your Bank's systems worth?

Business users often consider their Bank's systems to be hugely expensive and highly inflexible to change. This article argues that this perception is in part a product of undervaluing the core systems. A 'Value Model' is provided to help you realise the true value of your Bank's systems.

June

Report 2.1: What is Basel II?

This report gives a summary of Basel II and describes the regulatory imperatives for better MI on Risk

Report 2.2: What is IAS 39?

This report describes the key aspects of accounting in Banks that are likely to change with IAS 39

Report 2.3: MI Systems Architecture Implications of Basel II and IAS 39

This report describes the current MI systems of UK Clearing Banks and relates the requirements of Basel II and IAS 39 to the gaps in these systems

Report 2.4: Basel Operational Risk Implications

This report describes what new business processes and MI will be required to support Basel II

The Risk Market

This article is based around an interview between Ray O'Brien - managing director of risk consultancy E1Works - and the Howbankswork team. The interview provides some interesting views on the risk work currently developing in the major Banks and what the solutions are likely to be.

April

Report 1.1: Banking Operations Strategies & Technologies

This report provides a detailed examination of the key strategies and technologies currently being pursued in UK Banking Operations departments. These trends include centralising processing, outsourcing and the separation of service and processing

Report 1.2: Core Banking Processes and Recent Strategies

This report specifically examines recent strategies and technologies in relation to the Core Banking engine (see the Banking Operations Framework) and assesses success / failure

Report 1.3: Customers and Recent Banking Strategies

This report principally examines how recent banking strategies are likely to affect customers. This is illustrated with two exmaples of how a customer might perceive the changes within a bank

Report 1.4: Service Channels and recent Banking Strategies

This report relates the strategies and technologies discussed in report 1.1 specifically to sales and service channels.

Report 1.5: A guide to successful Business Process Outsourcing

This report examines what factors make for a successful outsourcing arrangement and what conditions / factors are likely to be detrimental.

A Passage to India

Boston Consulting Group's thought-provoking article on the march offshore, particularly to India, assesses why it makes good business sense for financial institutions to outsource overseas.

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