world leader in enterprise risk management solutions, today announced that
Royal Bank of Scotland (RBS) has selected and begun implementing Algo Credit
for global limits and exposures management. With a market cap of
pnds stlg 40.5 billion, RBS ranks as the world's fifth largest financial
Algo Credit's proven limits and exposure functionality provides a consistent, integrated framework for managing credit risk across the enterprise, covering real-time global limits and counterparty exposure management for both trading and banking book products.
RBS will be using Algo Credit to oversee financial credit risk for all of its extensive commercial and treasury portfolios. Their commercial portfolio, in particular, is quite complex due to multi-counterparty facility structures
with a number of credit mitigants like collateral and guarantees applied
against them at various levels. Algo Credit will manage these relationships as
well as specified counterparty restrictions.
Laurie Mayers, Group Head of Basel 2 and Credit Systems Coordination at RBS commented, "We needed the most effective solution available to obtain a
comprehensive view and management capability of our wholesale credit risk.
With Algo Credit, we are getting a single, fully integrated view of our
counterparty exposure across all products and business lines. Longer term,
Algo Credit will also serve as a core data storage and aggregation platform
for our BIS II risk architecture at the Group and core wholesale bank level."
RBS chose Algorithmics following a review of other vendors and cited the
solution's scalability and component based architecture, its coverage of both
banking book and trading book and proven customer record as key to RBS'
strategic decision. Algo Credit will replace some internal limit and exposure
management systems at the Group and divisional level, and will in other cases
be integrated with existing operating systems for the Group to achieve a
global view of its credit risk.
Following installation by end 2003 of Algo Credit for RBS' core corporate bank and financial markets businesses, interfaces to subsidiaries' credit systems will be completed.
Michael Zerbs, Chief Operating Officer at Algorithmics, said, "We are extremely pleased to enter into this relationship with Royal Bank of Scotland. RBS joins a growing list of ten of the top fifteen global banks that looks to Algorithmics to help manage their risk. Algo Credit provides the most reliable
limit management and aggregation infrastructure to support more effective
monitoring and management of credit risk at Group or operating unit level,
thereby dramatically saving costs and maximizing shareholder value."