Helping Dexia Bank to build a ‘Bank of Tomorrow’

No one could have predicted the changes that have taken place in the banking industry over the past decade. First the Internet, and more recently Web 2.0, have both transformed social and business relationships and in turn changed how businesses communicate with their customers. Capitalising on these changes in customer behaviour, new market entrants have begun to fiercely compete with more established financial institutions. In a world of cutthroat competition, all banks want to offer the best solutions at the lowest price in the least amount of time. IT plays a major role in helping banks to differentiate themselves by translating a good technology infrastructure into real-time business efficiency.

For over thirty years HP has worked in close partnership with a wide variety of the top banks and insurance carriers worldwide. Thanks to this experience HP has acquired a deep understanding of the sector, and its knowledge helps financial institutions worldwide to reduce IT costs whilst building an efficient, flexible IT infrastructure for the future.

As part of our investment in banking, HP runs Banking Innovation Centres in Milan, Geneva, Singapore and Cupertino. These state of the art facilities allow HP to discuss and assess the IT issues that are currently affecting the banking sector. Individual banks are able to visit these centres and work in partnership with HP to devise an IT strategy that will maximise their success through accelerating business growth, increasing efficiency and mitigating risk.

A good example of how the implementation of HP’s technology has made a measurable difference to the operations of a bank is that of Dexia Bank. Dexia Bank was created in 1996 through the alliance of two of Europe’s major players: Credit Local in France and Credit Communal in Belgium. By 2005 Dexia Bank was one of the top 15 banking groups in the Eurozone, operating in three principal markets: local public institutions, the retail market and the financial market.

Dexia initiated a ‘Branch of Tomorrow’ project in October 2004 with a study of the IT infrastructure it would require in order to meet its key goals of reducing costs while increasing mobility, ease of access, ease of use, and manageability.

The project was instigated because Dexia’s old system was not meeting its business needs. Each branch of the bank had one server, along with PCs on desktops. As the primary applications were running under UNIX on the computers in the data centre, the “heavy” branch office servers were underused, whilst operating and supporting them was complex and costly.

With the Branch of Tomorrow project, Dexia consolidated its legacy client/server architecture into a centralised one, based on HP BladeSystem servers in the bank’s data centre and HP Thin Clients in its branches (a thin client is a network computer without a hard disk drive. In client/server applications it is designed to be especially small, with the bulk of the data processing occurring on the server). The solution also incorporates Citrix MetaFrame Presentation Server software 3.0, which provides local and remote users with secure access to virtualised client/server applications from any location, device or connection.

The new infrastructure enabled Dexia to eliminate the 1,100 costly legacy servers in its branches. In addition, the Branch of Tomorrow includes a Mobile Office component, built with HP Notebook PCs and Deskjet printers, to enable staff to conduct sales calls anywhere, anytime, within legal restrictions. This gives staff greater mobility to move from branch to branch, to make sales calls to customers’ homes, and the flexibility to work from their own home computers. In the past, when product specialists moved from one branch to another, they could not access local data stored on the server in their assigned branch. Now agents can access the data they need from any branch with Citrix MetaFrame access on their home computers. Originally, staff were confused by the different means of accessing the bank’s network. Now, the access process is consistent irrespective of whether staff are in a branch, using the Mobile Office or working from home. Users go to a Web gateway, access a browser, enter a digital identification pass, and start a session of Citrix MetaFrame Presentation Server. From here onwards, the user is able to go anywhere within the system in the same Citrix session without having to log in again.

The HP Mobile Office also lets a bank representative take the bank to the customer’s home, with the ability to access applications and marketing information and print documents such as product descriptions, cost data or contracts.

An advantage of employing the HP Thin Clients is that workers in branches are able to concentrate on their job, selling products to customers, without having to concern themselves with PC maintenance. Before the Branch of Tomorrow project, Dexia staff had to worry about installing applications, carrying out backups and other technical issues. HP’s new technology infrastructure has eliminated all of these problems. Previously, technicians had to visit individual branches when a problem occurred whereas now, should something happens to a Thin Client, staff simply unplug it and plug in an alternative, fixing the problem instantly and eliminating the need for technical assistance and down time. Not only is this a more convenient and time saving method of IT maintenance and repair, but it also makes a significant impact on the associated cost savings.

The ‘Branch of Tomorrow’ project has already been able to deliver Dexia significant savings in terms of reduced support costs, and further savings are anticipated in the future. As Thin Clients have no fans or disks, the two main sources of problems for PCs, a large reduction in the number of hardware problems is also expected.

Infrastructure within branches is now very simple, and as such Dexia has re-negotiated its current contract and cut costs. When the current contract ends, the bank will again negotiate an entirely new contract with no servers in branches. After this takes place, Dexia anticipates savings that will allow it to invest in new functionalities in the branches, without any new budgets.

This example highlights how even the most established banks can utilise the latest technology to improve their efficiency, operations, deliver cost savings and ultimately provide a better service to customers. As competition intensifies in today’s banking industry, identifying, targeting and retaining customers will be more important than ever. It is vital to understand and meet the needs of the customer, but with new banking models restricting the amount of actual interaction banks have with their customers, IT systems are needed to help make every interaction count. This is where implementation of technology can result in real business outcomes.

With HP, the consumer experience is at the centre of what it does. Working in close collaboration with its banking customers, HP identifies the IT solutions that will result in business transformation and directly enhance the customer experience.