When the next round of turbulence hits, are you confident you can support your bank’s mandate for financial stability?
Protecting and growing reserves are critical to support central banks’ expanding mandates as well as fundamentally safeguard their independence. But another round of turbulence is compelling a rethink of reserve management systems.
How can you balance the need for capital preservation and reserve growth, all while maintaining reasonable risk levels?
Technology is an important lever. Legacy IT that is impossible to upgrade, siloed systems, data breaks and unresponsive vendors have created inefficient workflows and processes. Increasing investment complexity and difficult market conditions exacerbate these challenges. How can you begin modernizing end-to-end processes, reduce system complexity and operational risks?
Article
Three imperatives for reserve managers in uncertain times
1. Act decisively to support monetary operations and reserve management
2. Empower teams with risk, return, liquidity analytics at their fingertips
3. Partner with technology provider with an in-depth understanding of central banks’ challenges including security and jurisdictional concerns
Author: Alan Copping, GTM Senior Strategy Principal, SimCorp
How we helped Bank of Thailand improve operational efficiency
SimCorp has a global community of central bank clients that have undertaken technology transformation journeys built on a foundation of data. Our tech backbone has given reserve managers the ability to build a holistic operating model with seamless integration of all critical functions from the front to the back office.
Bank of Thailand is an example. Their reserves grew seven-fold to USD 226bn in the last 20 years. This prompted the bank to pursue a more efficient way to manage their growing reserves and be ready to tackle any crisis. The core requirement was the ability to seamlessly digest, analyze and apply data insights throughout the investment value chain and decision-making process.
With a better, holistic view of our reserves, we are more readily able to analyse and act on our data, and with greater governance. We are confident that the strong commitment we have placed on achieving operational efficiency, will hold us in good stead and enable us to responsively adapt to market conditions.
Head of Reserve Management at Bank of Thailand
Wongjan Sripaoraya, Head of Reserve Management, Bank of Thailand, shares the requirements for their transformation project with SimCorp and impressive achievements since going live.
Wongjan Sripaoraya, Head of Reserve Management, Bank of Thailand, shares the requirements for their transformation project with SimCorp and impressive achievements since going live.
How we help central banks around the world
We’ve implemented functionality across the entire investment lifecycle to streamline the bank’s vital competencies, including collateral management and foreign exchange. SimCorp Dimension now supports all the bank’s key front office workflows, for instance providing the staff with enhanced pre and post-trade compliance. In the back office, our best-in-class Accounting Book of Record delivers advanced processing of SWIFT and cash management, with superior accounting functionality.
This central bank chose SimCorp for our advanced front office functionality, comprehensive compliance and performance, and investment accounting covering IFRS standards. The bank uses our platform for all internally and externally managed funds on a wide range of instruments, from fixed income, money markets and gold. Increased automation gives the bank improved straight through processing to eliminate data errors and reduce manual tasks, so they can focus on more high-value tasks.
This Asian central bank selected SimCorp to consolidate its reserve and monetary operations and all invested asset classes, onto one core platform. Their transformation project addresses risk management, performance and attribution, compliance, collateral management, settlement and accounting. With our market-leading Investment Book of Record they will achieve a consistent and real-time whole office view of all assets.
The deployment of SimCorp Dimension will enable the bank to modernize its operations, become more efficient, and invest into more asset classes globally. With a better holistic view of all aspects of their operations, the bank will be able to easily analyze and act on data and ensure increase governance and transparency.
SimCorp for reserve managers. Why partner with us
- True cross-asset, front-to-back solution dedicated to the buy side, based on single source of truth for internally as well as externally sourced data sets.
- Investment and data transparency with best-in-class exposure monitoring, reconciliation, cash/liquidity management and high-level reporting.
- Support for central banks’ growing focus on transparency and accountability with internationally-recognized reporting standard (i.e. IFRS).
- A large community of asset owner clients, including 10 central banks with over USD 1.5 trillion in reserves, with international best practices, standards and ready-made integrations which reduce costs and time to value.
- A successful implementation record by highly qualified in-house staff, customer references and continuous engagement to upskill clients.
- Consistent upgrade cycles in a transparent roadmap that are completed in a short period of time with little involvement from the client.
- Stability of technology partner in terms of ownership, strategy, vision and consistent R&D commitments year after year.
- Ability to provide installation on-premise or in the cloud including the flexibility to have local data centers due to security or jurisdictional concerns.
- Fact sheet
Treasury management systems
Consolidation for treasury securities including Fixed Income, Money Market, FX, Derivatives and Structured Products.
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