National Bank of Kazakhstan

National Bank of Kazakhstan enhances investment management capabilities with SimCorp One

The National Bank of Kazakhstan (NBK) serves as the country's central bank, managing monetary policy and operating as a sovereign wealth fund through the Kazakhstan National Fund. NBK oversees gold, foreign reserves, and pension assets with a focus on financial stability and long-term economic growth.

Business case

To strengthen its position in an increasingly complex financial landscape, NBK identified several strategic opportunities to enhance their investment management capabilities and future proof their infrastructure: 

• Portfolio complexity: Managing a diverse and growing portfolio including gold reserves, foreign reserves, the National Oil Fund, and pension assets required better visibility and control. 
• Risk management and compliance: Increasing regulatory requirements drove the need for a more robust risk management framework. 
• Efficiency and automation: Multiple legacy systems created data silos and manual processes, leading to inefficiencies in reporting and strategy execution. 
• Scalable growth and innovation: The evolving investment landscape presented NBK with significant opportunities to expand their strategic capabilities and explore new market segments, which required greater adaptability and scalability from their infrastructure. 

"Our diverse portfolio management needs across foreign reserves, gold reserves, the National Oil Fund, and pension assets demanded a solution that could provide enhanced transparency and efficiency through automation and real-time analytics." explains Batur Vakhidov, Deputy Director of the Treasury and Monetary Operations Department, National Bank of Kazakhstan. 

Solution

After thorough evaluation, NBK selected SimCorp One to enhance its investment management capabilities through a strategic phased approach. The implementation successfully consolidated multiple legacy systems into a unified platform, eliminating data silos and manual reconciliation while ensuring operational continuity. 

SimCorp delivered the solution with clear project milestones, on-time and on-budget, while reflecting NBK's unique investment needs. Utilizing the comprehensive front-to-back platform, NBK now experiences improved operational efficiency with high straight-through processing rates, transparent management of investment operations, and reduced manual intervention—all supporting the bank's long-term strategy and operational resilience. 

Delivery certainty was achieved through a carefully planned phased approach: 

Phase 1: Established the foundation with SimCorp’s standardized processes while integrating with their existing system for currency portfolio operations. This phase demonstrated SimCorp's commitment to deliver what was promised during the selection process, improving operational efficiency through automated front-to-back processes and enabling real-time data synchronization. 

Phase 2: Built upon the standardized processes to incorporate NBK's unique investment identity by introducing advanced customized modules for allocated gold transactions, risk and return calculations, and implementing the Accounting Book of Records (ABOR) for comprehensive asset accounting. This phase showcased SimCorp's ability to balance standardization with configuration tailored to NBK's specific operational model.

The phased implementation approach was instrumental in our successful transformation," says Vakhidov. "It minimized risk by gradually introducing functionalities, allowed our teams to adapt and optimize workflows before full deployment, and ensured continuity of operations while enhancing automation and compliance capabilities.

Business benefits 

The onboarding of SimCorp One delivered substantial enhancements across NBK’s investment operations, enabling more effective management of the country's strategic financial assets. 

Enhanced portfolio management 

With SimCorp One, NBK now manages its diverse portfolio components with unprecedented effectiveness: 

• Foreign reserves: Enhanced transparency and efficiency in currency reserve management through automation and comprehensive analytics 
• Gold reserve: Streamlined handling of complex operations with allocated gold, including tolling and mini-bars transactions, as well as local market purchases under state priority rights
• National oil fund: Optimized strategic asset allocation and liquidity management via integrated risk assessment and performance measurement tools 
• Pension assets: Strengthened diversification and risk management while maintaining compliance with investment guidelines 

Before implementing SimCorp One, portfolio calculations and reporting were manually intensive, leading to delays," notes Vakhidov. "Now, with integrated data flows, reporting time has been reduced considerably, enhancing our strategic responsiveness.

Operational efficiency gains 

The unified platform transformed NBK's daily operations through: 

• Consolidation of seven legacy systems into a single integrated platform, eliminating data silos and redundant processes 
• Markedly improved straight-through processing capabilities, substantially reducing manual workloads and accelerating investment strategy execution 
• Dynamic data synchronization that eliminated time-consuming reconciliation procedures 
• Automated trade lifecycle management, minimizing processing times and operational risks 

Improved risk management and compliance 

The solution elevated NBK's risk management framework with: 

• Continuous monitoring of investment limits and compliance rules 
• Advanced capabilities for stress testing and scenario analysis 
• Seamless integration of pre- and post-trade compliance across all asset classes 
• Data-driven analytics that strengthen risk assessment and control 

Advanced data analytics and reporting 

NBK's data management has been revolutionized through: 

• Consolidated information from multiple sources into a single, authoritative truth source 
• Immediate access to total portfolio views for faster, more informed decision-making 
• Dramatically accelerated report generation capabilities 

Strategic agility and long-term value 

The partnership with SimCorp delivers both immediate strategic flexibility and enduring value to NBK: 

• Capabilities to rapidly launch new financial products and enter emerging markets 
• Support for diverse asset classes and investment strategies without technical constraints 
• Advanced analytics that enhance predictive capabilities and strategic decision-making 
• Digital transformation of investment processes, including ESG criteria integration 
• Heightened adaptability to evolving global financial markets and regulatory landscapes