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18 Swiss Banks Find a Haven in Dubai

SAGE discussed Asian threats on swiss private banks

SAGE Hosts Breakfast Briefing in Geneva

Jean-Luc Freymond, CEO of SAGE Group SA, was a member of the panel discussion of a Breakfast Briefing in Geneva last 8th February 2012; stressing on the importance of banking technology that will attract Asian bankers. JL Freymond explained that UHNWI in Asia, in general, are technologically savvy and are looking for systems that can offer them sophisticated products and provide them quick and efficient access to markets. He added that Swiss banks have to offer these new products in the face of Asian competition.  He also discussed the need for Swiss bankers to have more of an entrepreneurial spirit to compete with the Asian banks.

Below is a summary of the discussion taken from an article by Sébastien Ruche of L’AGEFI:

BEYOND THE STUBBORN MYTHS ABOUT ASIA

PRVATE BANKING:  Swiss banks must combine the threat of Asian competition and the attraction of the local market

How can Swiss private banks counter the Asian threat?  The conference organized yesterday in Geneva by WealthBriefing and SAGE had enough interest in a financial place in deep reflection on its business model.  But it had less questions about threats than opportunities.  The Asian market has to be made part of the strategy of any Swiss institution – but not based on myths.

The next threat, Hong Kong and Singapore, which have 11% of the world’s offshore wealth, remains well behind Switzerland, which maintains its global leadership with a market share of 27% despite international pressure, reports Ian Woodhouse of PwC.  Furthermore, Asian banks are not interested in European or Latin-American clients, says Antoine Bordelais, of Capital Private Wealth.  “Their competition is growing in the Middle East, particularly for reasons of geographical closeness, and especially on their domestic markets, where they show very aggressively throughout the range of products, knowledge of the client, local presence and synergies with corporate banking–a key element for entrepreneurial clients.”

The next opportunities, when approaching Asia, is to first dispel some myths, continues Michel Longhini, head of private banking at UBP.  Asia is no longer an untouched market, but it is strongly covered by financial intermediaries, with two stable leaders – UBS and Credit Suisse.  The creation of wealth and fortunes that remains in its place is nothing new – this has been a continuing theme for a good ten years.

Also, concerning profitability, myths are stubborn.  “Private banking projects in Asia have a much lower profitability level in return on equity, compared to a Swiss bank, with a difference of about 15% to 20%.”  This calls into question the credibility of numerous projects that focus solely on private management.

“An Asian presence can make sense for offering an alternative booking center, or if it can rely on corporate banking, but other than these cases, the reality of the benefits is not so bright,” Michel Longhini further estimates, according to whom many Asian facilities cannot stand without also engaging in non-Asian business.

At the same time, reminds the head of UBP, the risk level is very high in Asia.  Worse still, it is very difficult to estimate for a bank, between the use of heavy leveraging by clients and the sophisticated products that they use.  This explains the heavy losses sustained by private banking in Asia during the 2008 crisis.

Another persistent myth surrounding private management in Asia is that the local regulator will be more tolerant.  False.  The screw has been tightened considerably in recent times, requiring that a sale not be made until there is a plan of fiscal suitability for the client—that is to say, the relevance of a product for a client.  The result is that “in Hong Kong, it takes 40 to 45 minutes to sell a product that is explained in ten minutes in Europe.”  These “suitability” requirements increase the cost of training staff based in Asia.  This is a point that can eliminate another misconception: Asia has talent in private banking.

On the positive side, a significant part of the potential Asian clientele consists of members of the second or third generation, who are more sophisticated and more sensitized to the preservation of capital:  One point on which Swiss institutions can capitalize, according to Michel Longhini.  Any player in private management must have an Asian strategy, possibly starting in Switzerland, since 20% to 25% of the business of high net worth Asian individuals is booked in Europe, concludes the head of private banking at UBP.  “Rather than approaching an Asian expansion with a defensive stance, we should include it in a global strategy, taking into account the fact that profitability is lower in Asia and the risks are greater.  But for now, the“homework” has not been done!”

For more information on this news, please contact SAGE at +41 21 653 64 01 (Switzerland).

Geneva Breakfast Briefing: “How can Switzerland Counter the Asian Threat?”

The event is organized by WealthBriefing, the premier news, features and information source for the global wealth management sector, and will be held on 8th Feb 2012 at the Hôtel Président Wilson in Geneva.

The briefing will consist of an expert panel discussion followed by a Q&A with the delegates. Delegates will benefit from networking with other leading professionals and experts in the wealth management field, have the opportunity to participate in a lively panel discussion, and gain exposure to the latest thinking in industry best practices.

The event is open to wealth managers, private bankers and fund managers, among others, and is complimentary.

For more information on this news, please contact SAGE at +41 21 653 64 01 (Switzerland).

Banking on SAGE (Computer News Middle East)

Fernand Rasetti, COO, SAGE Group SA, a software development company serving the global financial industry in streamlining processes for core banking operations, was in the UAE to attend the MEFTEC conference. In a chat with Pallavi Sharma of Computer News Middle East, he discusses the company’s strategy in the coming months and how economic shocks are actually good for everybody.
Is this your first visit to the UAE? What is the reason for your visit now?
I have made regular visits to the UAE over the last two years, although this time round I am here for the MEFTEC event because it is one of the best events for the banking and finance industry in the Middle East, focused on middle and upper management, who go to the event in a search for solutions catered for their organization’s specific requirements.
At this point, SAGE wants to be seen in this market and missing an opportunity like the one MEFTEC presents, to exhibit ourselves, understand the market and customer needs cannot be justified. As vendors, it is also an opportunity to demonstrate solutions and meet new business prospects.

What sets SAGE apart from its competition across the globe?
SAGE’s solution is based on a core CRM model which is then split into modules that cover specific market segments. So we can scale the system up and down to deliver the customer’s requirements.
So in a bank, that has different activities like asset management, portfolio management, fund management, independent investors with each having a specific relationship with all the actors and interfaces that relate to the core activities, and if the solution can’t be adapted to their way of thinking, it won’t suit their needs. So our ability to change the system and accommodate specific requirements of the customer is definitely our USP.

What are the company’s strengths, and where lies its weaknesses?
Where our core strength is our flexibility, our weakness would be the ability to demonstrate our capabilities to customers This is especially one in market with a lot well known players who have been there longer, specially because not only are we younger we are also a much smaller organization.

The hot topics in IT these days seem to centre around virtualization, cloud computing and data analytics. We don’t hear much about SAGE in these technology discussions. How are you tapping into these trends globally?
I don’t like to use the term cloud computing, I believe that the banking and finance institutions, because of the sensitivity of their data are hesitant about cloud computing because they need this data to be hosted in a known location within a secure vault. So I would term it a hosted solution, where we provide the customer a service to host their data in a location that is external but well known. We can guarantee the protection of this data or information within our servers and our secure vault.
The industry that invests in this solution the most is the investment banking sector, wealth and asset management because they deal with a smaller number of customers and don’t have the infrastructure to support the IT required to meet their standards of service. We provide them a service that can be customized to suit their needs and may be scaled down to fit their budgets as well. IT becomes easy for them; the deployment is also more effective.

What are the major technology trends that you think will affect global IT decisions and effectiveness in the next 18 months?
The future of technology is definitely cloud computing. With companies such as Amazon and Google offering the cloud, the way people see data, manage data along with how they?store the data has changed.
In the past data needed to be enclosed and safe. People are accepting the constraint of hosting the data in an external space that is publicly accessible and shared between companies. It is a challenge and the scenario is much the same as when the Internet was first introduced and people said they wouldn’t need it and now they can’t live without it.
Cloud computing will definitely change the IT world, the way that organizations function and the role that IT departments play within their respective organizations. I think vendors need to educate the public about data security in the cloud to encourage more investment in this area. Once organizations know that their data is encrypted and secure from any attacks the cloud will gain momentum.
At the moment, we’re witnessing many organizations experimenting with the idea of cloud computing by placing their non critical data onto the cloud, but given time and knowledge, this will change. The?security concern needs to be addressed at a national level to encourage users; laws and regulations must also be put in place to better the security ecosystem surrounding cloud computing.

Do needs for software solutions vary very largely between SMEs and enterprises? How is SAGE targeting both?
I don’t think the requirements are any different. I think the capacity to service and manage the infrastructure and application requirements is what varies. While the larger organizations have the budgets to invest in the latest technologies, they don’t have the appetite for risk that SMEs do.

What do you believe are the challenges SAGE is likely to encounter on a global scale as it works towards the next stage of growth?
I see a dramatic change in the banking sector, which is now recovering from a slowdown in investments due to the financial crisis. Banks are also experiencing growth in operations and therefore, want to invest in scalable solutions based not only on what is applicable today but also based on what the future of the industry and its operations will be.

How important is the Middle East as a market to SAGE?
Not disclosing any numbers, the region represents over 30% of our revenue today. We believe this is a fast growing market with immense opportunities and growing competition. It is a young market with a lot of needs where vendors with flexible solutions can harness great leads.
Most importantly, I believe that shocks are good for business. We have learnt from the past that shocks make an organization or nation take notice of areas for improvement, what they’ve been doing wrong and optimize excesses. Suddenly, everybody realizes that excesses create redundancy and incompetence and so you rethink strategies based on what was earlier ignored or entirely missed out.
I also think this region is very young; companies are not mature enough to capture the scope of banking in the region. When you sell something to them you realize that although they want a particular solution or product they don’t understand the scope and extent of change the solution may trigger. So like every young country in the world, it takes time to create the knowledge base and skills?that an industry requires. It is worthwhile investment and is only a matter of time.

How does SAGE’s strategy vary when it comes to emerging regions? What are emerging markets and how do you work to overcome them?
They may vary around cultural aspects. For instance, we have invested a lot in Islamic banking but the objective is to develop a single solution that may be adapted and customized to suit the customer’s requirement regardless of regional divides.

How do you collect feedback from customers and how is this incorporated back into your solutions?
First, we visit the region, at least twice a year, to meet customers to get feedback and take note of opportunities for improvement. We provide comprehensive support from feedback to service, measure how we have responded to customer requests, and document these.
We are also working on regular calls and follow up from sales staff and are in the process of formalizing this project.

How does the feedback loop work in emerging regions like the Middle East? Do you have an R&D base in the region or is it primarily a sales setup?
No, we don’t have an R&D base in the region. We work on a factual model, a centralized process for software development, where we follow a specific work flow from assessment and design to acceptance test and delivery. The process is rigid and at no stage can it be jumped.
Our core development operations are based in Switzerland because we have good rapport with banking organizations and universities there. These contribute to the existing knowledge base.
We know that there currently exists a gap in knowledge sharing across developers and end users and are working on a detailed certification process for both developers and end users, so that eventually both parties know what is being talked about and fully understand all the elements and interfaces.
For the next few months, our strategy is customer acquisition. We are fighting to build a loyal customer base in the region, to let others know that we are here offering them highly customizable solutions.

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For more information on this news, please contact SAGE at +971 4 428 13 85 (Dubai).

SAGE introduces its new suite of Prospero solutions at MEFTEC 2011

Founded in Switzerland in 1986, SAGE was among the pioneers in financial software. Very early, it spotted sustained demand for cost-effective, flexible and reliable financial software. Putting users and their business requirements first led SAGE to develop Prospero which is a modular, integrated system packed with easy-to-use features that fills the needs of the buy-side and sell-side global financial communities.

Soon after releasing Prospero, SAGE was identified as a serious new player in the industry, thanks to its unique combination of business knowledge with technological skills. Today, SAGE’s client base consists of huge international corporations. From its regional office in Dubai, SAGE is dedicated to better service their clients and grow their presence in the GCC. Indeed, major clients in the region already include the likes of Global Investment House and Abu Dhabi Commercial Bank.

Prospero introduces a suite of targeted solutions
This week, Fernand Rasetti, Chief Operating Officer of SAGE is present at MEFTEC, the Middle East’s Financial Technology Market, in Abu Dhabi to share the latest developments to Prospero: the creation of 6 distinct Prospero solutions, each offering features tailored to specific segments of the financial industry. The solutions cover all aspects of financial operations: Wealth Management, Asset Management, Fund Administration, Independent Asset Managers/Family Office, Trading, and Portfolio Optimization.

The development of a suite of solutions is part of a broader strategy that is allowing SAGE to stay competitive and nimble in the increasingly complex yet cost-restricted universe of financial software. The key to Prospero’s suite of solutions is that it is robust and scalable. The installation of Prospero solutions may be simple and quick, but Prospero manages all types of products from the simplest to the most complex.

Any solution from Prospero’s suite of solutions can be implemented separately or as an integrated whole. Clients who cannot invest to set up their own hardware and data bank can access any functionality of Prospero as a tactical or strategic solution hosted by SAGE in its own highly secure data centre. Result: the client is billed only by the number of users and for the features used! This model is unique in the financial industry as there is no need to install the whole system: just plug it in to the existing system. With this latest option, the new suite of offerings is far more accessible to start-up companies and small-to-medium sized financial organizations. It is also in tune with the financial restrictions faced by IT departments across the industry – leaving SAGE and Prospero well poised for the future.

IBS Journal on Global Investment House’s progress with SAGE’s Prospero Wealth Management system

IBS Journal, the leader on in-depth analysis and reporting in the financial technology industry, has recently published an article summarizing the search, selection and implementation process embarked upon by Kuwait-based Global Investment House (GIH) for a wealth management system.

GIH, with AUM exceeding USD 5.3B and a major customer of Swiss IT vendor, SAGE, has gone on record with IBS about its implementation of Prospero, SAGE’s wealth management solution. The GIH/SAGE story can be summed up with the project suffering delays but still having an ‘end result’ that ‘is very good.’ These thoughts come from GIH’s CIO himself, Hakam Abu-Zarour.

Prospero has been installed in GIH’s Kuwait headquarters and Saudi office and once the implementation is proven by the users (in Kuwait), it will be deployed to its other branches and offices in the MENA region, including Egypt and Jordan.

The choice was made by GIH principally because SAGE offered an integrated asset management system which ran on a single platform and with a single database. […] Other systems on the market […] were a combination of two or three packages, running on multiple databases.’ […] such a system would have led to ‘operational issues and higher maintenance costs.’

Abu-Zarour believes that the bank’s RFP for an end-to-end asset management platform was ‘very complex’ but SAGE ‘had the basics of the requirements and the courage to identify and develop their gaps.’

SAGE profiled In IBS Middle East Banking Systems Regional Guide. Prospero considered as major player in banking system implementations

IBS Intelligence, the definitive source for independent and in-depth news, research and analysis of the financial technology market, regularly provides a comprehensive range of industry reports, guides and other resources including its latest and first regional guide on Middle East banking systems and implementations. The latest report published in October, Banking Systems in the Middle East, recognized that this region is now one of the most active areas despite the recent financial crisis. Having a diverse range of banks having diverse requirements from upgrades to enhancements to full implementations, SAGE echoes IBS’ analysis of the region.

SAGE opened an office in Dubai Internet City, Dubai, UAE in 2008 with the same market view of the Middle East. SAGE recognized that this region is moving towards the advancement of IT systems and processing in banks and financial institutions. In 2007, Abu Dhabi Commercial Bank (ADCB) became SAGE’s first client in the Middle East. ADCB required a tailored-made system for its new division on fund management and SAGE provided a Prospero fund management solution. ADCB has since then extended its use of Prospero into its wealth management and portfolio management operations. In 2009, SAGE also implemented its Prospero fund administration solution for Global Investment House in Kuwait.  In just a short span, SAGE has gone live with several users and countries in the Middle East from Kuwait, Saudi Arabia, and the UAE.

Recognizing the contribution of SAGE in the Middle East, IBS Intelligence included and evaluated SAGE and Prospero in its first regional guide. The report described the modularity features of Prospero which runs on multi-tiered architecture; enabling all functionalities to be rolled out entirely via a table-driven environment, eliminating the need for coding and proprietary scripts to manipulate. The report noted that Prospero takers are institutions that span all sizes having several locations all over the world.

Tarek Hamdan, SAGE’s CMO, states that “We at SAGE have seen a very obvious positive trend in the banking software industry in MENA as this market continuously picks up. In these times, financial institutions have to justify every cent spent on IT and what it brings to their business. Prospero, our suite of financial solutions, brings more than cutting edge technology: Swiss banking best practices and innovative functionality.”

Download the system overview on Prospero here.
For more info, use this form.

Independent research firm includes SAGE Group SA in “Hot Banking Tech Companies To Watch In 2010: Q2 Update” Report

An independent research firm has included SAGE Group SA in its “Hot Banking Tech Companies To Watch In 2010: Q2 Update” report.

SAGE is a financial technology firm that develops banking solutions. Its flagship product, Prospero, is a suite of nine separate software modules that cover all aspects of financial operations, including asset management, wealth management and fund administration.

In its July 2010 report, Forrester Research, Inc. describes technology companies that are addressing challenges in key banking industry processes.

The report notes that financial institutions are attempting to correct and change their business models in response to market challenges, and describes 11 vendors that are providing innovations in key banking industry processes, such as risk management and asset management.

According to the report, “the evaporation of nearly 20 percent of the wealth of high-net-worth (HNW) individuals put new pressures on wealth advisors.”  Many of these firms are now looking at how technology could help them better serve their high-net-worth clients.

The report went on to say that “SAGE’s Prospero provides global and regional money management firms with an easy-to-deploy solution that accelerates the time-to-value with minimal effect on their IT shops.

In particular, the report recognized SAGE for tackling two big challenges for its target audience: “the first, the challenge of integrating multiple applications from multiple providers, complicated by the second, the time and expense of customizing myriad apps to address firm-specific process, workflow, and reporting requirements.”

SAGE Group SA’s CEO, Jean-Luc Freymond, believes that current market conditions have changed the rules for software vendors.“Regulations are becoming more complex, and cost pressures are increasing,” Freymond says.

According to Freymond, SAGE addresses these changes by offering innovative solutions at minimal costs. “Prospero is different from other systems because it offers a smooth rollout, simplified management of complex financial products and regulatory requirements, and total integration between modules – all within a cost-effective pay-per-use model,” continues Freymond.

“We believe that only the systems that can offer this combination of features will succeed in today’s marketplace, so our recognition by Forrester is very encouraging,” Freymond adds. “We believe it shows that SAGE is ahead of the game.”

Download the system overview on Prospero here.
For more info, use this form.