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Overview of Temenos T24 Model Bank

• TEMENOS EDUCATION CENTRE

Warning: This document, is protected by copyright law and international treaties. No part of this
document may be reproduced or transmitted in any form or by any means, electronic or mechanical,
for any purpose, without the express written permission of TEMENOS Holdings NV Unauthorized
reproduction or distribution of this presentation or any portion of it, may result in severe civil and
Copyright © 2004 TEMENOS HOLDINGS NV
criminal penalties, and will be prosecuted to the maximum extent possible under applicable law.”
Information in this document is subject to change without notice.

Copyright © 2006 TEMENOS HOLDINGS NV

T24 Model Bank Introduction (T2MBIN-R5) - Overview 1


Temenos T24 Functional features

• Temenos T24 is a product for international financial services


market
• It has comprehensive functions
– Integration
– Timely (both in batch and real time)
– Multi-currency
• It has core functionality
• It has optional Applications

Copyright © 2005 TEMENOS HOLDINGS NV

While Temenos T24 boasts of a ‘disruptive technology’, it also draws


upon the rich functional features that have been developed over the
years. This makes it one of the most advanced software products in the
world to meet the needs of the financial services market.
There are certain facets of the software, which are ‘Core’ and which all
banks which wish to use Temenos T24 have to procure. The ‘Core’
includes, among others, applications such as CUSTOMER, ACCOUNT,
LIMIT, the Security management system, various utilities, the
messaging systems (DELIVERY). Most business modules such as
LOANS.AND.DEPOSITS, MORTGAGE, FOREX, SWAPS,
SECURITIES, DERIVATIVES etc are optional and banks may procure
them based on their business requirements.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 2


Open Standards

• Temenos T24 runs on


– Open hardware
• Scalable architecture that permits adding further servers as volumes
expand

– Open user interface through browser, HTML and XSLT

– Open connectivity through XML and Web services

– Open database

Copyright © 2005 TEMENOS HOLDINGS NV

Temenos T24 is based on open standards. This means that clients can
select the best vendor or environment to suit their own needs – whether
this is low cost, high performance, local support or any other factor.
If this changes in the future, they can switch vendor without altering
their investment in TEMENOS T24.
This will provide true longevity to their chosen system.
T24 can run on jBase or on Oracle database or any other database
which the clients are comfortable with.
Large banks have also been concerned about scalability and also
resilience of the software. T24 has been able to address these
concerns by an architecture which provides for multiple
application/database servers at various levels. Additional processing
capacity can be added by simply adding more servers. The architecture
also ensures that there is no single point of failure.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 3


Temenos T24 Functional Architecture

Web Call Centre Mobile Channel Services Browser Web Svcs IVR

Version Presentation Enquiry

Security Management System

Static Contact History Overview Customer Profitability Preferences and Groups

Retail Trust /Private Treasury Corporate General


Wealth Management

Asset Management FX Trade Finance Nostro Recs


Accounts Performance
DDA, checks, cards, Modeling… Money Market Commercial Loans Confo matching
statements, charges, Funds Transfer
sweeps, direct debits Fiduciaries Swaps Guarantees Euro
Mortgages / loans Fixed deposits FRA Cash Management Past Due
Brokerage Intermediary comp
Teller Order processing Repos Syndicated Loans
Corporate Actions… Tax
Mutual Funds* Capital Markets Leasing Image
Planning
Futures/Options Bills Document mgt

Accounting MC/ MB Dev Toolkit Workflow Risk Delivery


CORE Exception STP Limits / Collateral Swift / FIX
General Ledger Multi Currency Programming
Support Modules Dispo Market Risk Print / Telex / Other
MIS / Profitability Language, Database

Security Management System

Copyright © 2005 TEMENOS HOLDINGS NV

We have an overview of the Temenos T24 banking system here.


The Core part of Temenos T24, is the most essential part, around which
the optional modules are built. Security Management System over
encompasses the core and optional modules.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 4


Temenos T24 Technical Architecture

Web Call Centre Mobile Channel Services Browser Web Svcs IVR

Version Presentation Enquiry

Security Management System

Static Contact History Overview Customer Profitability Preferences and Groups

Retail Trust /Private Treasury Corporate General


Wealth Management

Asset Management FX

T24 Server
Trade Finance Nostro Recs
Accounts Performance
DDA, checks, cards, Modeling… Money Market Commercial Loans Confo matching
statements, charges, Funds Transfer
sweeps, direct debits Fiduciaries Swaps Guarantees Euro
Mortgages / loans Fixed deposits FRA Cash Management Past Due
Brokerage Intermediary comp
Teller Order processing Repos Syndicated Loans
Corporate Actions… Tax
Mutual Funds* Capital Markets Leasing Image
Planning
Futures/Options Bills Document mgt

Accounting MC/MB Dev Toolkit Workflow Risk Delivery


CORE Exception STP Limits / Collateral Swift / FIX
General Ledger Multi Currency Programming
Support Modules Dispo Market Risk Print / Telex / Other
MIS / Profitability Language, Database

Security Management System

Copyright © 2005 TEMENOS HOLDINGS NV

This is the standard T24 architecture that has been used for many
years. It remains unchanged.
T24 Server will hold T24, jBASE, OFS and TEMENOS CONNECTOR
server installations. TC Server is the entry point for requests into T24. It
is in the T24 server, that all the business logic is held and the actual
validation of data happens at this server.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 5


Temenos T24 Technical Architecture - Resilience
Multi-channel
P r e s e n t a t io n

MQ
APIs
API – Java and COM
S c a le

Excel etc.

Browser GIB Internet Web Services Enterprise Console Other connectivity

Network Dispatcher

NO SINGLE Web Server


C o n n e c t iv it y

Web Server •Apache Tomcat


POINT OF •IBM Webs Sphere
FAILURE •Oracle Application
S c a le

Server

T24 Browser

L
component

M
Load Balancer

X
Linux, IBM I/Z Series,
Presentation Presentation Presentation
A p p lic a t io n

HP, Unix, Windows


S c a le

C object code

NON-STOP No batch Non Stop!

Oracle, DB2, J4
D a t a b a s e
S c a le

Cluster Installation

Copyright © 2005 TEMENOS HOLDINGS NV

Presentation layer enables T24 to receive input from various sources such as Browser,
Interfaces such as an ATM interface , java programs, or from any other third party
software.
Connectivity Layer is where the Web Servers are installed. Apache Tomcat, IBM
Websphere, Oracle Application Server are web servers supported by Temenos T24.
This server is used to publish web pages on to the Internet Explorer
The T24 Browser component and the Temenos Connector Client are deployed on
these web servers.
The Network Dispatcher is a third party software, used for load balancing. Its job is to
receive messages from IE or any other source of input and route it to any one of the
available web servers. It will maintain the request that it receives in a queue and send
it to any one of the available T24 application servers. The same logic applies to the
responses as well. One of the commonly used load balancers is IBM’s MQ.
T24 Server : Each of these servers will contain a separate T24 (without bnk.data
directory), jBASE, OFS and TEMENOS CONNECTOR server installations. TC Server
is the entry point for requests into T24. It is in the T24 server, that all the business
logic is held and the actual validation of data happens at this server.
Database Server : T24 is database independent, and supports different databases,
including Oracle and DB2. It is in this database server that Oracle/DB2/J4 is installed.
This is where the T24 data will reside in XML format. Oracle/DB2 databases support
clustering and therefore a single Oracle/DB2 installation can be done across multiple
servers. J4 does not support clustering and therefore only one database server can be
used if J4 is to be used as a database

T24 Model Bank Introduction (T2MBIN-R5) - Overview 6


CORE - CUSTOMER

Static Contact History Overview Customer Profitability Preferences and Groups

Customer centric

All descriptive details of Customer stored centrally


Address, Industry, Sector, Status, Target…

Preferential treatment in products can be set based on Customer grouping


Customer level static changes automatically change consolidation of A/L and P/L

Customer record needed for anyone with whom the Bank deals

More in session on CUSTOMER…

Accounting MC/MB Risk Delivery


CORE
General Ledger Multi Currency Limits / Collateral Swift
Support Modules
MIS / Profitability Workflow Market Risk Print / Telex / Other

Copyright © 2005 TEMENOS HOLDINGS NV 7

The CUSTOMER Application contains basic information (static data)


relating to any "Customer" with whom the bank has dealings.
It is central or “Core” to the system. All management information,
services are organised around Customer record.
The CUSTOMER Application contains all the basic information about
any "Customer“ (entity) with whom the bank has dealings with. It need
not be a ‘Customer’ in the conventional sense of the word. In this
sense, a customer base record will need to be opened for
correspondent banks, brokers, guarantors etc., as well as for current
and savings account holders.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 7


CORE – Accounting
Static Contact History Overview Customer Profitability Preferences and Groups

Customer Accounts 01000 - 9999 Possible to accrue


Current accounts 1000 - 1999 interest
Vostro accounts 2000 - 2999
CATEGORY Nostro accounts 5000 - 5999
Saving accounts 6000 - 6999
Internal Accounts 10000 – 19999 Not possible to
Cash accounts 10000 – 10999 accrue interest
Accounts Fixed Assets, Suspense etc 11000 – 19999
01000 - 19999 LD and MM 21000 – 21999 Deposits
Sub-blocks range 21001 – 21029 Takings
21050 – 21074 Loans
21075 – 21084 Placements
Contracts Product related PL 50000 – 59999
20000 - 49999 50000 – 50999 Interest paid
51000 – 51999 Interest received
52000 – 52999 Commission
Non Product related PL 60000 and above
Profit & Loss 60000 – 60999 Salaries
50000 - 69999 62000 – 62999 Operating expenses

Accounting MC/MB Risk Delivery


General Ledger Multi Currency CORE
Limits / Collateral Swift
Workflow Support Modules
MIS / Profitability Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 8

One of the important aspects of T24 is that all dealings with customers are classified
either as ‘Accounts’ or ‘Contracts’.
The main difference between an Account and a Contract is an Account permits the
balance to be debit or credit from time to time, whereas in any particular contract,
while the balance may change from time to time, its sign will not change from the
original – viz debit will not be allowed to become credit and credit into debit. At the
end of the contract, the balance only become NIL.
Customers have different types of Accounts such as, Current Accounts, Savings
Accounts, Margin Accounts and so on.
We also have internal accounts, which are bank’s own accounts that maintain “base”
information not held anywhere else in the system, e.g.. Cash, Capital & Reserves,
Premises & Furniture, Departmental and other Suspense Accounts, Tax awaiting
Payment to Authorities etc.
Customers may have Contracts such as, Money Market deals, Securities contracts,
Loan contracts, Letters of Credit, Foreign Exchange deals and so on.
It may be observed that in all these contracts, the initial sign never changes to the
other sign
There are also Profit and Loss Accounts (Categories in T24), which are basically of
two types. Firstly, there are ‘Product related’ income or expense. E.g.., Interest on
Loans, Commission on LC, Charges on Current Account etc. The second type of
income/expense is overheads, which are not product related. Salaries, Rent,
Electricity, etc. fall under this group.
All these product groups are differentiated from each other by using suitable
CATEGORY code

T24 Model Bank Introduction (T2MBIN-R5) - Overview 8


CORE – Accounting entries
Static Contact History Overview Customer Profitability Preferences and Groups

Entries affecting
STMT.ENTRY
Account balances

ASSETS & LIABILITIES

RE.CONSOL. Entries affecting


SPEC.ENTRY all other
Assets & Liabilities

Entries affecting
PROFIT & LOSS CATEG.ENTRY
PL Heads

Accounting MC/MB Risk Delivery


General Ledger Multi Currency CORE
Limits / Collateral Swift
Workflow Support Modules
MIS / Profitability Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 9

All transactions / contracts create the relevant accounting entries across


the clients accounts and for the banks own internal records. Entries are
automatically generated for authorised transactions. Accounting
entries are classified as STMT.ENTRY, CATEG.ENTRY and
RE.CONSOL.SPEC. ENTRY. Combination of these entries are possible
and happen. Though entries are generated only after authorisation of
transactions, debits to accounts affect the balances after the input is
committed (at unauthorised stage itself).
Entries affecting Account balances are stored in STMT.ENTRY file by
the system – be it Customer account or Internal account
Entries affecting P & L heads are stored in CATEG.ENTRY file. In T24,
we do not open `accounts’ for profit and loss heads.
All other entries are stored in RE.CONSOL.SPEC.ENTRY

T24 Model Bank Introduction (T2MBIN-R5) - Overview 9


CORE – General Ledger and other reports
Static Contact History Overview Customer Profitability Preferences and Groups

STMT.ENTRY
Entries affecting
Account balances ASSETS & LIABILITIES
Key Consolidation based
On Customer and
Application information
Entries affecting REPORT CREATION
all other RE.CONSOL.
Assets & Liabilities SPEC.ENTRY HEADER
LINE COLUMN
…………...
…………..…

PROFIT & LOSS


Key Consolidation based
Entries affecting On Customer and
PL Heads CATEG.ENTRY
Application information

Accounting MC/MB Risk Delivery


CORE
General Ledger Multi Currency Limits / Collateral Swift
Support Modules
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 10

The financial data resulting from transactions, have been consolidated


by the system according to the selection criterion defined in
CONSOLIDATE.COND file.
The T24 concept does not have General Ledger accounts, but the
selection criterion of CONSOLIDATE.COND enable us also to create
reports, respectively lines.
Before creating lines, we need to create the columns and the header.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 10


CORE – Multi Company (MC) Vs Multi Book (MB)
Static Contact History Overview Customer Profitability Preferences and Groups

• Model Bank uses Multi Book


• Features of MB/MC are:
– A financial entity (Branch/Dept) can be opened as Company or
a Book
– Possible to produce independent balanced books at financial
entity level
– Financial reports are automatically created at entity level
– Automatic Inter- Entity accounting at transaction level
– Flexible Consolidated Reporting (entities can be grouped and
reported)

Accounting MC/MB CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 11

Single Company, Multi Company and Multi Book are three ways in
which financial accounts can be held in T24. Under Single Company,
the entire bank is considered as one accounting entity and all financial
files are common. If branch wise consolidation of accounts is desired, it
is achieved by defining individual branch / accounting entity using
DEPT.ACCT.OFFICER.
Under Multi company set-up, each branch or accounting entity is
considered as a separate company. While Customer record is
optionally shared, financial files are unique to each company. Accounts
and Contracts are unique to each company.
Model Bank follows the third approach – Multi Book, where financial
level data is stored in same database, but identified separately using
COMPANY.CODE field in each Account and Contract. It allows
independent financial entities to produce independent balanced books
while sharing the same financial data files – CUSTOMER and NOSTRO
ACCOUNT
It is relatively simple to move customer accounts and contracts from
one branch to another without closing and reopening them

T24 Model Bank Introduction (T2MBIN-R5) - Overview 11


CORE – Multi Company (MC) Vs Multi Book (MB)
Static Contact History Overview Customer Profitability Preferences and Groups

• Differences between MC & MB (Functionality)


– In MC it is possible to have a different local currency for each
financial entity. In MB, the local currency has to be the same
across all financial entities.
– In MB it is possible to transfer accounts/contracts from one
entity to another. This is not possible in MC.
– MB allows closure and merger of branches
– Foreign Exchange Positions are consolidated for all entities in
MB whereas it will be available only at independent entity level
in MC.

Accounting MC/MB CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 12

Customer accounts and contracts can be transferred from one


Company to the other, without actual closure. Their Ids will continue to
be same
Possible to transfer select or even all Customer accounts and
contracts to another Company
Inter book accounting automatic
Loan input at HO, and belongs to HO. Proceeds transferred to
Customer’s Current account in USD with Branch 3
Accounting entries automatically passed at H.O
Debit Loan Credit Inter-Branch Account Branch 3: USD-
12800-0011-0001
Accounting entries automatically passed at Branch 3
DR. Inter-Branch Account : HO USD-12800-0001-0011.
CR. Current Account of Customer

T24 Model Bank Introduction (T2MBIN-R5) - Overview 12


CORE – Multi Company (MC) Vs Multi Book (MB)
Static Contact History Overview Customer Profitability Preferences and Groups

• Differences between MC & MB (Architecture)


– In MB Financial level data is held in a single database for all
entities whereas in MC financial level data is held in separate
table for each entity
– In MB financial level data from different entities can be easily
combined. While this is possible in MC, it is less efficient.
– In MB customer accounts do not have to be identified by a
branch code as in MC, so it is possible for all accounts in each
group of branches to follow the same structure.
• Note – It is also possible to use a combination of MB & MC

Accounting MC/MB CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 13

T24 Model Bank Introduction (T2MBIN-R5) - Overview 13


CORE – Limits
Static Contact History Overview Customer Profitability Preferences and Groups

• In Model Bank, Limits can be established at Customer level and


Customer group level
• Limits can be established at Product and sub product levels
– Multiple limits may be given to a Customer for the same
Product / sub product
• Limits can be optionally made variable, in line with underlying
collateral value
• While attaching Limits to accounts to allow overdrawal, it could
be attached to single or many accounts
• More on session on Limits…

Accounting Multi Book CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 14

When a bank does a transaction with a Customer, it is exposed to


different types of risks – Risk towards an individual or groups of
customers; Countries or groups of countries; Currencies; Commodities
Setting a limit for a client allows the lender to control exposure to that
client and to monitor its own overall position. For example, before a loan
is made to a customer, a limit must be set up specifying the maximum
amount that the bank considers it prudent to lend that customer. The
limit will enable the clients transactions to be processed without
problem providing the transaction falls within the agreed limit.
The application will also allow clients to draw facilities in different
currencies and will re-calculate the outstanding amounts into the
currency of the limit.
Setting up limits also allows a bank to monitor its exposure to its clients
by product, e.g. Forex and by sub-product, e.g. a limit for spot. The
lender can also monitor its exposure by commodity, e.g. Industry code,
or by country or currency.
A reducing or non-revolving Limit does not have its value restored when
a Transaction is repaid. A Non-reducing or revolving limit is always
maintained at the sanctioned levels.
A limit may be fixed or variable depending upon it being allowed to
change in line with changes in collateral value.
T24 Model Bank Introduction (T2MBIN-R5) - Overview 14
CORE – Delivery
Static Contact History Overview Customer Profitability Preferences and Groups

• Delivery refers to generation of Advices/Messages in T24.


• Delivery is an integral part of Core T24 which is closely linked to
the transactions input through various modules.
• Predefined messages/advices generated on authorisation of
transaction are sent to the destination without user intervention.
• The relevant messages produced as per predefined mapping and
formatting (from the field input in transaction to the pre defined
fields/SWIFT tags) are sent through appropriate channels viz Print,
SWIFT etc.
• The channel/ mode (carrier) of delivery can be configured system-
wide and up to the Customer or account level.

Accounting Multi Book CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 15

T24 Model Bank Introduction (T2MBIN-R5) - Overview 15


CORE – Delivery
Static Contact History Overview Customer Profitability Preferences and Groups

• However, if any of the set up of address, carrier, mapping or


formatting specifications are incorrect, the message will go into
Repair.
• Messages in ‘Repair’ can be resubmitted after making necessary
corrections.
• A well mapped and formatted delivery message will be
automatically sent to the delivery channel/interface unless they
have been specifically put on “HOLD”

Accounting Multi Book CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 16

T24 Model Bank Introduction (T2MBIN-R5) - Overview 16


CORE – Delivery
Static Contact History Overview Customer Profitability Preferences and Groups

Types of advices

Statement Delivery
Deal slips advices
of Accounts

Statements Deal confirmation slip Delivery advices to Customers,


Sent to Printed and handed over Other banks about various events
Account across the counter Can be outward or inward through
holders 1. Customer record opening Swift or Print or Telex
periodically 2. Issuing Drafts 1. Remitting funds
3. Teller transactions 2. Reimbursement instructions
3. Rate change advice

Accounting Multi Book CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 17

For accounts, Statement of accounts are sent periodically by Print or


Swift
For other applications, it is possible to advice the client of a transaction
through Deal slip and/or Delivery advice.
Deal slips are printed and issued across the counter

T24 Model Bank Introduction (T2MBIN-R5) - Overview 17


CORE – Delivery
Static Contact History Overview Customer Profitability Preferences and Groups

Delivery advices

Normal Soft
Delivery Delivery

Rules for production of messages on Rules for production of messages user


authorisation of transaction are definable.
hard coded. Content of message is user definable.
Preview of message possible during Input.
Limited scope to change the contents
Ability to override the defined rules at
of the produced message.
transaction level
Available for specified modules (Trade Finance,
Guarantees etc)

Accounting Multi Book CORE Risk Delivery


General Ledger Multi Currency Support Modules Limits / Collateral Swift
MIS / Profitability Workflow Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 18

T24 Model Bank Introduction (T2MBIN-R5) - Overview 18


CORE – Static tables related to CUSTOMER
Static Contact History Overview Customer Profitability Preferences and Groups

RELATION COUNTRY

RELATIONSHIP
MANAGER
CUSTOMER STATUS CUSTOMER

LANGUAGE

INDUSTRY

TARGET SECTOR

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 19

The above diagram illustrates the various static tables that are linked to
the CUSTOMER file.
These are maintained through Administrator menu
Later on in CUSTOMER session we will make use of these tables.
COUNTRY table contains the static details of each individual Country,
for example, Country Name, Currency Code(s) etc. This is used to
indicate residence and nationality of a Customer
DEPT.ACCT.OFFICER : Identifies the main Account Officer responsible
for the Customer. It is useful for relationship management and also for
MIS purposes
SECTOR table helps grouping of customers at a top level for several
purposes. The sector is commonly used to define the ‘Legal Status’ of
the customer i.e.., Individual, Public Company, Government,
Corporation, Trust etc.
INDUSTRY table defines the activity or business the customer is
involved in.
RELATION table is used to specify the various types of relation that
could exist between one Customer and another.
TARGET table helps group Customers for future marketing purposes

T24 Model Bank Introduction (T2MBIN-R5) - Overview 19


CORE – Static tables related to Holidays
Static Contact History Overview Customer Profitability Preferences and Groups

Static details of each country like Name,


Currency code, Consumer goods index etc

COUNTRY

REGION
Week ends, non week end holidays for
each region of every country year and
month wise defined here. All T24
applications check this during Input
HOLIDAY
Validation for events falling on holidays

Helps define upto 99 Regions within a


Country where public holidays differ
from other parts of the Country.

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 20

These are maintained through Administrator menu. When we input transactions, we


will see how the System makes use of these tables.
COUNTRY: Contains static details of each Country, for example, Country Name,
Currency Code etc. Dummy Country codes may be used for entities that do not have
an official Country code but have a Currency Code, for example, the European
Currency Unit.
HOLIDAY: This table is used to indicate the public holidays for each Country, or
Region within a Country, for the calendar year over which the bank's current business
is spread. User must indicate, for each Country or Region, the public holidays and
which days of the week make up the weekend.
All T24 Application will refer to this table during input validation to check that if any
dates entered by the User are holidays and/or to raise an override to accept any
contract event that fall on a Holiday. It is also used to determine the delivery date, by
taking non-working days into consideration.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 20


CORE – Static tables related to Currency
Static Contact History Overview Customer Profitability Preferences and Groups

• Numeric Ccy Code COUNTRY


• Decimal Places for • Upto 99 markets to
rounding all calculations quote different rates
• Interest Day Basis CURRENCY PARAM • Consolidated into 9
• Precious Metal markets
• Equivalent Currencies
• Country Code CURRENCY CURRENCY MARKET
• Base Ccy Rank

FORWARD RATES • Bid and Offer rates for


different periods
For each Currency & Market, forward exchange
• Interest tolerance for MM
rates as premium / discount to the Spot rate for
different Rest periods. To get the Rest date, • Used for automatic roll over

value in Rest period is added to SPOT date.


Used for Tolerance check and Rebate revaluation PERIODIC INTEREST
Accounting Multi Book Risk Delivery
General Ledger Multi Currency CORE
Limits / Collateral Swift
Workflow Support Modules
MIS / Profitability Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 21

These are maintained through Administrator menu


When we input transactions, we will see how the System makes use of these tables
CURRENCY.PARAM: Contains common details for each Currency to ensure that the
same numeric code and no of decimals are used on different currency files in a multi
company environment. Currency name and Interest basis maybe changed at
individual Currency file level. Numeric currency code, an alternate to Currency code,
can only be changed on this file. Once a record has been authorised, number of
decimal places cannot be changed. In the field EQUIVALENT.CCYS relationship must
be established to enable currencies to be used as interest or charge currencies on any
accounts set-up for the main currency. If two currencies are involved in a conversion,
then the currency with the lowest rank will take preference as base currency
CURRENCY.MARKET: Possible to create different market rates for the same
currency - Separate rates for Notes / Travelers Cheques etc. Consolidation keys are
formed market wise. Markets beyond 9 will be consolidated with the market type of the
first digit – example 10 with 1.
FORWARD.RATES: The Rest periods can be defined either in months, e.g. 1 month,
or in days, e.g. 7 days, 15 days etc. To calculate the date of the rest period, the
system will add to the SPOT date the value defined in the field REST.PERIOD. If the
Rest period is defined in months and the calculated date falls on a non working day,
the date is moved forward to the next working day. If, however, this next working day
falls in the next month, the system will instead move BACKWARD to the previous
working day in the same month.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 21


CORE – Interest related – INTEREST BASIS
Static Contact History Overview Customer Profitability Preferences and Groups

Different Interest day basis for calculation of


interest possible depending on the method
followed for calculating number of days
in interest period and days in a year
For example, if Interest Basis B (366/360)
is selected, then the interest calculation
would look as follows:-
Principal Amt x Rate x 366 / 360
A1 Additional interest earned in February
calculated on last day
A2 Additional interest earned in February
calculated on penultimate day

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 22

In the options specified above the number on the left (Days)


(Numerator) represents the number of days basis for multiplying on the
top line of the interest calculation. Whilst number on the right
(Denominator) is the basis for dividing on the bottom line of the interest
calculation and represents the number of days in the year.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 22


CORE – Floating interest – BASIC INTEREST
Static Contact History Overview Customer Profitability Preferences and Groups

BASIC RATE TEXT

Currency and
Interest effective date
part of ID
BASIC INTEREST

Possible to set a negative interest rate for MM


Possible to give positive or negative spreads

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 23

BASIC.INTEREST: This table allows various frequently used floating


Rates, e.g. Base Rate, Prime Rate, Overnight Rate etc., to be defined
separately for each Currency and stored in a central place where they
can be accessed, as required, by various Temenos T24 Applications.
'Prime records' with the same Interest conditions can be linked directly
to a Basic Interest ID in this table, rather than defining the Interest Rate
details on each transaction or contract record. For example, if the
overdraft interest conditions for Currency Accounts are related to the
base rate, each current Account or group of Accounts (when conditions
are applicable at group level), should refer directly to the Basic Interest
Rate ID defined in this table and not contain the value of the rate in
itself.
When a rate change takes place, the user will then need to update only
the Basic Interest Rate IDs defined in this table with the new rate(s) and
the date on which it is to become effective. This will then automatically
update all the transaction/contract records which are tied to each
Interest ID.
A description of each rate is held in the BASIC.RATE.TEXT table to
allow the user to easily identify each one of the Basic Interest Rate
table ID's.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 23


CORE – Floating interest – PERIODIC INTEREST
Static Contact History Overview Customer Profitability Preferences and Groups

PERIODIC INTEREST

Bid rate is for Deposits

Offer rate is for Loans

Generated daily.
Back dated changes are also possible

Used for automatic roll over, Interest


Tolerance checking for MM

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 24

This table is used for “LIBOR” type rates of this nature . Rates vary
depending on the length of time and for Bid and Offer purposes.
For Loans and Deposit contracts that are linked to
PERIODIC.AUTOMATIC option, user will define a schedule for rate
reviews. At the scheduled dates the system will refer to this table and
automatically “pick up” the relevant rate and apply that to the contract
until the next review date.
This table maybe automatically updated/interfaced daily with an
external feed such Reuters, or maintained manually by the user.
PERIODIC.INTEREST keys are generated daily by the System. It is
possible to effect changes in rates of dates prior to system date.
As a result, all contracts which had accessed the (changed) key at an
earlier date, will recalculate interest based on the changed interest rates
PERIODIC.INTEREST will be used by applications such as Foreign
Exchange to default interest rate on Forward contracts using the
Interest revaluation method or the Money Market applications to
perform automatic Rollover. It is also used to check interest rate
tolerances, based on pre-set parameters, in MM contracts.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 24


CORE – General Charges for Accounts
Static Contact History Overview Customer Profitability Preferences and Groups

NUMBER TURNOVER
TURNOVER
NUMBER
BALANCE
BALANCE OF
OF CREDIT
CREDIT CREDIT
CREDIT
REQUIREMENT
REQUIREMENT INTEREST
INTEREST
STATEMENT
STATEMENT

ACCOUNT
ACCOUNT
STATEMENT
STATEMENT
CHARGE
CHARGE GENERAL
GENERAL CHARGE
CHARGE TRANSACTION
TRANSACTION
CHARGE
CHARGE

ADDITIONAL
ADDITIONAL
DEBIT
DEBIT INTEREST
INTEREST

HIGHEST
HIGHEST
GOVERNMENT
GOVERNMENT NUMBER
NUMBER TURNOVER
TURNOVER DEBIT
DEBIT
MARGIN
MARGIN OF
OF DEBIT
DEBIT DEBIT
DEBIT
Accounting Multi Book Risk Delivery
General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 25

The charges applied to an account will vary from Bank to Bank and
from different categories of account.
For example:
1) charges may relate to volume of turnover and defined in the files
NUMBER.OF.DEBIT and NUMBER.OF.CREDIT or
2) charges may be applied to the issue of statements and defined in the
file ACCT.STATEMENT.CHARGE
Several such charge tariff structures may be stored in the file
GENERAL.CHARGE .
A particular GENERAL.CHARGE record could be linked to a group of
accounts, say all current accounts, or all current accounts of UK
residents or even to an individual account

T24 Model Bank Introduction (T2MBIN-R5) - Overview 25


CORE – Charges and Commission for other applications
Static Contact History Overview Customer Profitability Preferences and Groups

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 26

FT.COMMISSION.TYPE: Each Commission Type can be defined as a


flat amount or as one which varies according to the amount. In the latter
case different percentages can be defined for different Bands or Levels
of transfer amounts. Minimum and maximum Commissions can be
specified for each Band or Level together with overall minimum or
maximum commission charges. Commissions in local currency must be
entered and special foreign currency Commissions can also be defined
CALC.TYPE: FLAT, LEVEL and BAND: Assume a deal of Principal
100,000 USD where commission is calculated based on the Principal.
The commission type record specifies an applicable rate of 2 per cent
up to 10,000 and 1.5 percent over 10,000.
If Band is specified for all sub value groups, 2 calculations will be
performed, i.e. 2% on 10,000 1.5% on 90,000. If Level is specified for
all sub value groups, 1 calculation will be performed, ie. 1.5% on
100,000. If Flat is specified, the basic Flat Amount will be applied.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 26


CORE – Correspondents and Relationships
Static Contact History Overview Customer Profitability Preferences and Groups

AGENCY records are established to


record Standard Settlement Instructions
for Correspondent Banks or
Customers for currency wise settlement.

• Credit Suisse wants all USD paid


to Merrill Lynch, New York.
• David Brown PLC wants all EUR
paid to Deutsche Bank, Frankfurt.

Obviates need to re-enter details


at transaction level

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 27

T24 Model Bank Introduction (T2MBIN-R5) - Overview 27


Preferential grouping
Static Contact History Overview Customer Profitability Preferences and Groups

• Possible to group customers/accounts for setting up of


interest/charge conditions
• Examples
– Interest rate of 1.75% p.a. is applicable on all Savings Accounts
however Staff Savings Accounts carry interest of 2% p.a.
– Commission for Draft Issue is 1.5% of the transaction value
subject to a minimum of £ 5. For high net-worth clients, the
percentage is reduced to 1%.
– Basic Rate Tax of 20% applicable for credit interest on
accounts/deposits held by Individuals, Sole-Proprietors &
Partnerships (not applicable for Corporates).

Accounting Multi Book Risk Delivery


General Ledger Multi Currency CORE Limits / Collateral Swift
MIS / Profitability Workflow Support Modules Market Risk Print / Telex / Other
Copyright © 2005 TEMENOS HOLDINGS NV 28

T24 Model Bank Introduction (T2MBIN-R5) - Overview 28


Temenos T24 Customisation scope

Parameters &
Conditions Local Reference Fields

Temenos T24
Screen Design Implementation
(Version) Tape Enquiries & Reports

User defined Routines Default field data

Customised
Temenos T24

Copyright © 2005 TEMENOS HOLDINGS NV

Every bank has its own unique needs/requirements from the software.
While Temenos has built `Model banks’, banks would still like to
configure the system to have their own choices of conditions, and hold
additional information, would like to have user friendly screens with
default conditions and above all get their own reports other than the
standard enquiries and reports.
Temenos T24 is highly parameter driven and gives the banks a host of
choices across modules. This calls for a project type of implementation
out of a product. Temenos T24 is flexible enough to allow all these.
Thus Temenos T24, though a product, tends to be completely unique at
each location.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 29


Temenos T24 Pre configured Model Bank

Standard Parameters Essential Local


& Conditions Reference Fields

Temenos T24
Over 550 Implementation Over 50 Enquiries &
Versions Tape 50 Reports

Over 100 Delivery set up Default field data

Pre configured
Model Bank
With business process
for all Banking operations

Copyright © 2005 TEMENOS HOLDINGS NV

Model Bank is generic T24 and does not contain local development
It uses Core T24 fundamentality to run bank business
It suggests a T24 process for each banking operation
It Contains over
550 Versions
350 Enquiries
50 COB Reports and
100 Deliveries Set-up
Model Bank led approach of implementation cuts down the
implementation time to a great extent

T24 Model Bank Introduction (T2MBIN-R5) - Overview 30


Model Bank - Contents

Desktop Channel Services Browser

Version Presentation Enquiry


Security Management System

Static Contact History Overview Customer Profitability Preferences and Groups

Retail Treasury Corporate General

Accounts FX Trade Finance Nostro Recs


Cheques,
Statements, charges, Money Market Commercial Loans Confo matching
sweeps, Direct debits Funds Transfer
Securities Guarantees
Mortgages / loans (Own book) Syndicated Loans Past Due
Teller Tax
Image
Fixed deposits
Document mgt

Accounting Multi Book Risk Delivery


CORE
General Ledger Multi Currency Limits / Collateral Swift
Support Modules
MIS / Profitability Workflow Market Risk Print / Telex / Other

Security Management System

Copyright © 2005 TEMENOS HOLDINGS NV 31

T24 Model Bank Introduction (T2MBIN-R5) - Overview 31


Temenos T24 Functionality
or

Transaction Input Authorizer Queries

Security Management System

RDBMS
APPLICATION LOGIC

Temenos T24 Core


Close of Business
Accruals
Validation Maturity Control
Reporting
AUTHORIZED Revaluation
UNAUTHORIZED

Static Data
Risk Management Messages/Clearing Accounting
Product
Interest Rates General Ledger
Credit Risk Print
Commissions Debits/Credits
Market Risk
Currency SWIFT SID Interface
MIS / Profitability
etc... Collateral
Custom Interfaces Regulatory Reporting

Copyright © 2005 TEMENOS HOLDINGS NV

Any Temenos T24 operation passes through SMS and reaches Core.
Relevant Static Data are used and limits / working balances are
checked and updated before authorisation in case of debits (and after
authorisation in case of credits). The deal is then authorised by a user
other than the original initiator (Maker and Checker concept being
used). Then the respective delivery messages are generated, required
accounting entries generated.
All Batch processes are typically performed during COB (Close of
Business) for generation of reports, effecting accruals, carrying on
necessary revaluations etc.

T24 Model Bank Introduction (T2MBIN-R5) - Overview 32