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Case Study: Intelligent Finance and St James’ Place Bank
This study describes Arum’s engagement with IF and St James Place Bank in 2004 analysing and upgrading the compliance of the Banks systems running under Debt Manager. This requirement arose when the Financial Services Authority became accountable for compliance and responsible for enforcement in October 2004.
The Challenge
Debt Management at IF had operated on manual management and recovery systems until well into 2001. At this time, Arum became involved in the ultimately successful delivery of Debt Manager in Autumn 2002. In Autumn 2004, the Financial Services Authority introduced new legislation and revised compliance rules and the challenge was to change the systems in line with the new rules in time for the FSA compliance deadline. Failure to do this could potentially lead to a fine or reproach from the FSA and some resulting negative publicity.
The Outcome
Working in close partnership with IF business and key IF analysts, the project implemented in the tight timescale set. Intelligent Finance were delighted to successfully implement the updated compliance rules which complied fully with the new FSA regulations set in a very timely manner. Enhanced business processes and Data Manager functional changes concerning mainly collections were delivered to a set timetable and with little disruption to BAU operations. The project delivered under budget and this included a knowledge handover to the business. In addition Arum was able to assist with some Debt Manager issues within the business.
Graeme Mackie, Credit Control Manager at Intelligent Finance said:
“The automated Debt Collections System is an important part of our daily Operation and it was vital that we maintained service thoughout a project we had to complete. The commitment, flexibility and technical skills demonstrated by the Arum Systems team throughout the project were key factors in a successful upgrade of our production system and we were delighted to be amongst the first to implement these regulatory changes.”
How did we achieve this successful outcome?
By understanding IF’s business and working closely with the IF team to coordinate all aspects of the planning and implementation. Key to the success was the partnerships we set up. The cooperation with and support Arum received from both the technical and business teams in Intelligent Finance was first class. Our in depth knowledge of the Debt Manager product and history was crucial to adopting a realistic planning schedule for the upgrade, ensuring continuity of the Operations and managing the expectations of the IF Business teams.
Here’s how we resolved our challenge. A prerequisite is homework on company background to gain an understanding of the customer.
Organisation Background
Intelligent Finance and St. James Place Bank are divisions of HBOS plc. Both banks offer customers a range of personal banking services - over the internet, by phone and via professional advisers. Customers can offset borrowings against savings and IF is the largest and leading offset provider in the UK. In June 2003, the bank had three million accounts with total lending at £14.5 billion and total customer deposits standing at £3.8 billion.
Intelligent Finance operates out of two facilities in Scotland – one in Livingston, West Lothian and the other in Rosyth, Fife.
St. James's Place Bank targets an influential customer base through members of the St. James's Place Partnership. A St. James's Place Partner can facilitate the opening of a St. James's Place Bank Account and can advise on the Bank's products.
Project Background
With effect from 31 October 2004, The FSA introduced a mandatory new set of rules for Mortgage lenders and intermediaries. The aim of the project was to ensure that IF and St James Place collections and recoveries systems complied with and transferred transparently to the new FSA regulations. Failure to comply could lead at best to a reproach or fine and perhaps even suspension of mortgage lending business. Uninterrupted system service or, at worst, minimal service impact was a project goal.
Significant amendments needed to be made to processes and systems. This included a complete re-work of the mortgage collections processes and changes to the relevant part of the Debt Manager application. The project resulted in the largest change made to collections and recoveries processes since the introduction of Debt Manager at IF and included:
- Analysis and specification of new processes
- Development of all changes to software
- Specified changes to in-house interfaces
- Design and management of early testing phases
Project Aims
It was imperative that all collections and recoveries systems and processes for mortgages complied with the new FSA regulations by the 31st October 2004.
Continued systems operation (BAU) should be maintained as far as possible.
Project Challenges
- The required upgrade was the largest collections and recoveries process change and the first major change to the Debt Manager product since its implementation in 2002.
- There had been little significant change on the system since implementation and therefore not a lot of experience and impacts of changing the system
- In order that BAU service was maintained, access to this team had to be minimal and we had to minimise the impact of the change on BAU operation.
Drop dead project date of 31st October was critical not only to the project but IF as a business. - Key project personnel left Intelligent Finance during the project and changed and inexperienced personnel had to be accommodated.
- Debt Manager Application was dependent upon data feeds to/from one legacy host system and data integrity was of paramount importance to complying with processes defined in new routers.
- New data requirements for Debt Manager to be compliant were not available from the host system and therefore alternate methods of resolution were required.
Our Role
Arum Systems provided skilled Debt Manager consultants to work on the functional, development and testing aspects of the project and they also ensured that batch performance remained unaffected after the changes were made.
Intelligent Finance took advantage of Arum consultants on site to help the business. Our team provided expert advice on other Debt Manager related issues during the period of engagement.
Although outwith project scope, this effort was very worthwhile and a real positive for IF.
Arum was selected for this engagement because of our good reputation on collections and recoveries and Debt Manager. The fact that Arum had previously delivered high quality consultancy for Intelligent Finance and the high quality of our consultants were key factors in IF’s selection process. Intelligent Finance viewed engaging Arum as a way of reducing the risk to delivery of this critical project.
Project Delivery
- The project was completed within the timescale set
- Intelligent Finance were fully compliant with the new regulations set out by the FSA within the specified deadline.
- The enhanced business processes and functional changes concerning collections activity
- were delivered on time with minimal disruption to business as usual operations.
- The project was delivered under budget
- Full knowledge handover was given to the business
- Support for miscellaneous Debt Manager issues within the business.
Both Intelligent Finance and St James’s Place Bank were compliant within the FSA timescale and this was achieved with little disruption to the continuing operation.