Case study
Alfa-Bank drives smarter risk
management decision-making
“With Misys
FusionRisk, we can
do much more than
simply put measures
in place to meet
regulations; the
solution allows us to
ensure compliance
while providing
greater value to
the business.”
Tatyana Kosareva
Head of IT Systems for
Investment Banking and Risk
Management
Alfa-Bank
Misys FusionRisk
At a glance
Products
••Misys FusionRisk
About Alfa-Bank
Alfa-Bank is the biggest private bank in Russia and has been growing steadily
in recent years. The bank provides a wide range of financial products and
services, including corporate and retail lending, deposits, payment and
account services, foreign exchange operations, cash handling services,
custody services and investment banking services. Headquartered in Moscow,
Alfa-Bank employs approximately 25,000 people at 804 offices in six countries,
and serves more than 162,000 corporate clients and 11.4 million retail clients.
The challenge
Over the last few years, Alfa-Bank has been growing rapidly against a backdrop
of a volatile economic climate. The bank set itself a mission to comply with
Basel III regulations to avoid sanctions, and to use the investment to strengthen
its existing risk management capabilities across many business lines.
The solution
“By deploying Misys
FusionRisk, we expect to cut
the cost of IT support for our
investment banking division
by 25%.”
Tatyana Kosareva
Head of IT Systems for Investment
Banking and Risk Management
Alfa-Bank
Alfa-Bank has built a strong second line of defence to ensure that effective
risk management and regulatory compliance are put in place across the
enterprise. Using Misys FusionRisk, Alfa-Bank brought all risk information
together on one risk platform and connected various front office systems,
gaining a single, trusted source of risk information. The bank was then able to
provide new insights that it can use for better decision-making and reporting.
The result
Alfa-Bank has reduced the time and effort involved in ensuring regulatory
compliance. Easy access to comprehensive risk information guides better
decision-making, especially when deciding to enter new markets. The company
also cut IT support costs for its investment banking division by 25%.
alfabank.com
2
Misys FusionRisk | Alfa-Bank
“Risk management will act as a crucial partner
for the business, identifying key opportunities,
anticipating possible threats and optimising
returns for the bank.”
Tatyana Kosareva
Head of IT Systems for Investment Banking and Risk Management
Alfa-Bank
Alfa-Bank is establishing a stronger second line of
defence, replacing isolated risk engines and disparate
processes with a single platform, built on Misys FusionRisk
The challenge
The solution
Promoting a new attitude to risk
As the biggest private bank in Russia,
Alfa-Bank faces unprecedented
pressure to grow and defend its
market position: from earnings erosion
on the one hand to rising operating
costs on the other. These challenges
have been compounded by a host of
new regulations, most notably Basel III.
As part of a broader strategy to
ensure compliance with regulations,
including Basel III, Alfa-Bank is
enhancing its risk management
capabilities by establishing a rocksolid second line of defence. The bank
is consolidating disparate systems
into a centralised risk and compliance
platform, built on Misys FusionRisk.
Alfa-Bank anticipates that the new
approach will significantly reduce
operational risk by eliminating manual
processes that contain an inherent risk
of human error, as well the need for
data reconciliation and duplication.
To survive – and thrive – in this
uncertain environment, Alfa-Bank
needs to strike the right balance
between performance and risk,
improving operational efficiency
and fine-tuning decision-making
to protect capital and avoid
sanctions from regulators.
Tatyana Kosareva, Head of IT Systems
for Investment Banking and Risk
Management at Alfa-Bank, elaborates:
“We identified risk management
as a key enabler for both meeting
regulatory requirements and driving
better operational performance. We
wanted to embed risk management
into every area of the business, turning
our risk managers into partners for
the business, so they could work
together to make smarter decisions.”
However, Alfa-Bank found that
operational complexity made it
difficult to gain the insight needed to
make timely, accurate decisions. For
instance, the bank relied on 27 different
controlling processes across different
functions to approve corporate loans.
Tatyana Kosareva comments: “Over
the years, we had built up a number
of different systems and processes for
managing risk. Having so many isolated
risk engines made it difficult to gain
timely access to information and build
a truly enterprise-wide view of risk.”
Tatyana Kosareva comments: “One
of the most important factors in
the success of the project has
been the strong communication
and relationships that have
been established between Misys
and our internal team.”
The bank will reconcile its trading and
banking books on a single platform,
and establish a unified view of all
exposures, limits and key risk indicators.
“We want to create a single view
for all users, from the CEO down to
risk managers, where they can find
exposures by counterparty, country or
a single deal, and visualise and report
the outcome,” states Tatyana Kosareva.
“It is critical for us to provide decisionmakers with rapid access to the right
information, especially in the current
economic environment, where we
can’t afford to make mistakes or be
held back by slow decision-making.”
The initiative has gained support
from the highest levels of the
business, with Alfa-Bank’s CEO
acting as a key project sponsor.
The move to an integrated risk
management platform is also expected
to deliver important cost savings.
“By deploying Misys FusionRisk,
we expect to cut the cost of IT
support for our investment banking
division by 25%,” says Tatyana
Kosavera. “What’s more, we can
reallocate valuable resources to
other areas of the business, which
will drive further cost efficiencies.”
By placing risk management at the
heart of the business and granting
decision-makers easy access
to accurate risk data, Alfa-Bank
will empower teams with better
overviews of risk exposures
and more timely reporting.
“We are building an independent
second line of defence, which will
give us the ability to monitor the
effectiveness of risk management
and compliance practices across the
bank,” explains Tatyana Kosavera.
“Risk management will act as a
crucial partner for the business,
identifying key opportunities,
anticipating possible threats and
optimising returns for the bank.”
Misys FusionRisk | Alfa-Bank
3
Embedding risk in the business allows Alfa-Bank to
meet short-term regulatory demands, all while
enhancing business performance
“Misys FusionRisk gives us the
tools to challenge and support
every decision we make with
a clear understanding of the
risks involved.”
Tatyana Kosareva
Head of IT Systems for Investment
Banking and Risk Management
Alfa-Bank
Ensuring easier compliance
Equipped with an enterprise-wide
view of risk exposure, Alfa-Bank
plans to create a three-year roadmap
for its regulatory compliance
strategy. Key deliverables will be
introduced at regular intervals,
based on regulatory timelines.
Tatyana Kosareva comments: “With
Misys FusionRisk we can adopt
international best practices and
refine risk management, making our
methodology better and simpler.
We can perform calculations and
see results faster than ever before.
Quicker, more flexible measurement
and reporting helps us remain
compliant as regulations evolve.”
By embedding risk awareness from the
top down, Alfa-Bank can guide better
decisions at all levels of the business.
“The improvements we are making
go far beyond risk management,
and are already having a positive
impact on day-to-day operations,”
says Tatyana Kosareva. “For example,
we created a new model for credit
scoring to meet Basel III requirements,
and now we’re using the same model
in our everyday operations to drive
faster and more precise scoring for
our clients. With Misys FusionRisk,
we can do much more than simply
put measures in place to meet
regulations; the solution allows us to
ensure compliance while providing
greater value to the business.”
About Misys
Misys is at the forefront of the financial software industry, providing the broadest portfolio of banking,
capital markets, investment management and risk solutions available on the market. With more than
2,000 customers in 130 countries our team of domain experts, combined with our partner eco-system,
have an unparalleled ability to address industry requirements at both a global and local level. We connect
systems, collect data and create intelligent information to drive smarter business decisions. To learn
more about how our Fusion software portfolio can deliver a holistic view of your operations, and help
you to solve your most complex challenges, please visit misys.com and follow us @MisysFS on Twitter.
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