New Transfer Pricing and Profitability Analysis Software To Help Promote Quality of Business and Accelerate Innovation

Bank of Communications Hong Kong Branch has selected Oracle to provide a next-generation performance management system to support strategic decision-making. Over the next 15 months, Oracle Consulting Services will implement the Oracle Financial Services Applications (OFSA) Transfer Pricing and Profitability Manager, two of the analytical applications integrated within the Oracle Financial Services Applications (OFSA) family of solutions. By adopting the Oracle Financial Services Applications solutions, Bank of Communications Hong Kong Branch is leveraging industry best practices and a business model that is a proven success among banks worldwide.

The adoption of these tools will put Bank of Communications Hong Kong Branch at the forefront of Hong Kong's local banking sector in terms of the level of sophistication for calculating cost of funds, interest margins, risk premiums and operational cost allocation. As a result, the bank will be able to measure the profitability across multiple dimensions of its business, including sales channels, products, customer groups and individual accounts.

Mr. Shou Fugang, Chief Executive, Bank of Communications Co., Limited, Hong Kong Branch said, "In the run up to 100th Anniversary of the Bank of Communications, we are investing to strengthen the foundation of our Hong Kong Branch operations with the objective of raising margins while accelerating growth."

Shou added, "The new banking performance management system we are acquiring from Oracle will not only let us measure the profitability of our existing business portfolio, it will also enable us to better project the performance of new product concepts under different operating scenarios. We believe this will position Bank of Communications Hong Kong Branch to compete more aggressively in Hong Kong's financial services market."

Oracle Transfer Pricing - the first commercially-available matched maturity funds transfer pricing system determines the account-level interest spread earned on assets and liabilities. It supports a comprehensive range of transfer pricing methodologies, based on industry best practices to calculate accurate results at the lowest available level of detail. The combination of Oracle Transfer Pricing and Profitability Manager offers a comprehensive solution for the calculation, analysis, and reporting of profitability across multiple business dimensions.

"The highly competitive market in Hong Kong puts a continual squeeze on the margins of businesses. Banks need to focus on their most profitable customers as well as on maximising the performance of their products and channels in order to do well," said Mr. Dennis Yeung, Managing Director, Oracle Systems HK Limited. "With the implementation of Oracle Transfer Pricing and Oracle Profitability Manager, Bank of Communications Hong Kong Branch will gain far more granular insights into its business. The Oracle system will provide the information needed by the line-of-business managers to make daily business decisions. Likewise, senior management will have access to up to date information to set directions that will enhance the profitability and growth of the bank."

The implementation of Oracle Transfer Pricing and Profitability Manager at the Bank of Communications Hong Kong Branch builds on its Oracle Financial Data Manager that supports Oracle Risk Manager systems. As a central repository for all financial data, the Oracle Financial Data Manager is the foundation of a comprehensive decision management solution that enhances customer profitability, asset/liability management, budgeting and planning, and performance measurement functions within the financial organisation.