Description

One of Anago’s clients, a well established Dutch Bank, monthly calculates the Economic Profit from its loan portfolio on a contract basis. Understandably, these are complex risk management calculations. One of the tasks is the calculation of the Economic Cost (EC) using various parameters such as risk profiles and market trends.

State of Art

Originally, the calculations were made using spreadsheets that were supplemented with calculations made in Visual Basic for Applications (VBA). The data that was delivered on a monthly basis was then manually copied to the spreadsheets.

 

The use of the spreadsheet technology has led to the following bottlenecks:

• The complexity of the computational problem does not fit within the spreadsheet technology.
• Complex arithmetic needs to be programmed, which is time-consuming and inflexible.
• Many manual acts and a high chance of errors.
• The system cannot be integrated with other Economic Profit (EP) calculations.

Migration

The bank has investigated the possibilities of replacement. This investigation showed that replacement with a standard system was practically impossible. The only option left was to replace the original system with a customised system. However, this neither turned out to be a reasonable choice, due to the many disadvantages of such a solution: The complexity of the system resulted in a long and risky trajectory, the construction appeared costly and the system concerned did not provide the required flexibility. Hence, also in this case the following environment appeared to be the best alternative, which made the disadvantages of a customized system disappear: Assemble by using Anago.

Anago solution

During two workshops the required functionality of the Economic Cost calculator was discussed. The functional description that was created for this purpose functioned as a basis. This functional description already contained general calculations, but the detailed calculations still had to be addressed.

The system supports the following functions:

• Automatic reading of provided data
• Validation of provided data
• Input and validation of various parameter tables
• Calculation of Economic Cost
• Exportation of Economic Cost data to different processing systems  
• Monthly batch process

As opposed to programmed customised systems the Anago solution naturally provides a number of required functionalities:  exporting to Excel and pdf; data importation; turning and tilting of tables; logging of changes in the data; back-up; authorisation and connections with different systems.

Profit

The Anago application facilitates the automatic calculation of the Economic Cost data using data from different providing systems. The results will automatically be written away, which makes the system fully integrated with the Economic Profit calculations. The Anago system could also function as a basis for margin calculations for account managers when offering new products.

Besides, compared to the original situation, using the Anago application is more efficient in several ways:

• Manual input is limited by automatic connections
• The process is less error-prone because of an internal integrity-check that detects conflicting and missing data.
• Thanks to the unique Anago assemble environment, adjustments can be realised a lot faster than when using the traditional environments.

 

Would you like to know more about this specific client case or about the implementation of customised application using Anago Assemble? Contact Thomas de Nooij telephonically under the following number +31 (0)30 657 2613, or through e-mail: tdnooij@anago.nl.