Sacombank’s Rip-and-Replace Turbo-Charges Branch Expansion

Amid a rapidly developing country, Vietnam’s Sacombank expanded over the course of 17 years to become the country’s second-largest commercial institution with 240 branches. Yet Sacombank continued to rely on the same core banking systems from its founding in 1991. “Our original system was provided by a local IT company,” explains CIO Van Dung Bui. “It couldn’t scale out any further.”

A cross-functional project team evaluated solutions from global vendors in April 2008, narrowing the list to four. According to Bui, Sacombank (US$5.15 billion in total assets) selected Temenos’ (Geneva) T24 for its flexible, stable architecture.

“T24 was a proven solution, deployed in Vietnam and around the world,” remarks Bui, who was hired in early 2008 to modernize the Ho Chi Minh City-based bank’s IT environment. “In addition, Temenos’ familiarity with our culture, understanding of our regulatory environment and investment in local support staff demonstrated its long-term commitment to our market.”

Indeed, Temenos devoted about a dozen onsite technicians to the project as well as an offsite team. On Sacombank’s side, approximately 100 full-time and 50 part-time employees were dedicated to the project. Of those, about 50 were drawn from the IT department’s total head count of 115.

Following Temenos’ enterprise hardware requirements, in October 2008 Sacombank invested in IBM (Armonk, N.Y.) System p AiX application and reporting servers, HP (Palo Alto, Calif.) Superdome database servers and an HP StorageWorks SAN as well as Oracle’s (Redwood Shores, Calif.) Database 10g.

The new hardware environment was integrated from December 2008 through February 2009, and T24 was deployed on a test system. “To save time, we tested T24 and developed a migration tool in parallel with other tasks,” explains Bui. “We planned to migrate data related to almost 1 million customers from Microsoft [Redmond, Wash.] SQL and jBASE to Oracle XML while ensuring the smooth banking operations throughout the go-live period.”

When user acceptance testing began in March 2009, training also kicked off for approximately 5,000 employees. After an uneventful test migration in April and May, more than 3 million accounts were systematically moved to T24 from June through the project’s completion in September 2009.

“Our original project time frame was one year, but we completed the project a month ahead of schedule,” Bui relates. “Strong support from our board of directors and board of managers was critical. Senior leadership met with the project’s steering committee weekly to ensure timely communication and decision making.”

Got an Hour?

The overhaul has proven transformative. “Today setting up a new branch in our core systems only requires an hour or two,” Bui reports. “We opened 70 new branches in 2009, and we expect to reach our goal of 400 branches by year-end. Most important, customer transactions are completed within an average of three to five minutes, which has significantly improved our customer satisfaction rates.”

Now Sacombank is leveraging T24 to implement other technologies -— such as data warehousing, CRM, risk management and workflow management -— to continue to enhance its competitive position, according to Bui. “We’re also launching new products and services,” he adds. “For example, we’re expanding our Web presence from inquiry-only to include transactions and payments. Overall, we are very pleased with T24’s contributions.”

SNAPSHOT

Institution: Sacombank (Ho Chi Minh City, Vietnam)
Assets: US$5.15 billion
Business Challenge: Replace legacy systems with modern core system to improve service and enable growth
Solution: Temenos’ (Geneva) T24 core banking platform

Anne Rawland Gabriel is a technology writer and marketing communications consultant based in the Minneapolis/St. Paul metro area. Among other projects, she's a regular contributor to UBM Tech's Bank Systems & Technology, Insurance & Technology and Wall Street & Technology ... View Full Bio