Agricultural Bank of China selects TEMENOS CoreBanking for accelerated Next Generation System Transformation

GENEVA, 5 May 2010 – Temenos (SIX: TEMN), the market leading provider of integrated core banking systems, today announced that Agricultural Bank of China (ABC), China’s third largest bank serving 350 million customers through 24,000 branch outlets has selected TEMENOS CoreBanking (TCB) as a Reference Architecture on which to create its Next Generation Core Banking System. By partnering with Temenos in this way, ABC will accelerate the delivery of its Core Banking Transformation program, driven by the needs of its rapidly evolving customer base. TCB is a functionally rich, modern Retail Core Banking System, underpinned by an industry standard Enterprise Banking Data Model. It is implemented by the world’s largest banks to transform highly complex, fragmented legacy core systems into an integrated, simplified and cost-effective solution.   
  
“Customer expectations in this market are changing fast as they become exposed to ever greater choice in products and services from both domestic providers and foreign competitors. We believe that the flexibility and re-usability delivered through the data and application architecture of our future core banking system will be critical in successfully delivering new products, efficient processes and improved insight over the next 20 years. We have to evolve the business to meet the emerging demands of our customers and as a bank with 400,000 employees, the size and complexity of our business makes implementing and managing change challenging. We also acknowledge the risk involved in core systems replacement; it was a hard decision to make but our customers are at the heart of our business and we need the technological excellence to provide the services they need; we are confident that our next generation platform will enable us to do this and more”, commented Mr Ye, Chief Technology Officer, ABC.

Andreas Andreades, CEO, Temenos comments: “ABC, like all Tier-1 banks in the world, has the most to gain from replacing its complex fragmented architecture with an integrated core engine designed around unified data. The prospect of core replacement is considered so daunting that the majority of banks postpone the decision even though their existing core system is unsustainable. ABC has chosen an intelligent, pragmatic approach to replacement whereby they take an incremental low-risk phased approach to transition and transformation, seeing this as a strategic journey rather than a project. This enables ABC to align its investment with each phased deliverable to ensure benefits are continuously delivered into the business throughout the transition. And of course they can move at a pace with which the bank can effectively absorb change”

The first phase of the project is well underway to establish the TCB operational Reference Architecture and ensure that the bank’s IT Team understand all facets of the data, functional and technical architecture that will form the basis of the bank’s future IT blueprint. ABC signed the contract with Temenos at the end of 2009.

About ABC
The Agricultural Bank of China (hereafter referred to as ABC or the Bank) is the first commercial bank established in the People's Republic of China in 1951 and the State's first specialized bank set up after the reform and opening-up of the country in February 1979. Ever since its establishment, the Bank has been playing an important role in China's rural economic sector. In 1994, the Agricultural Development Bank was separated from ABC. In 1996, the Rural Credit Cooperatives, once an affiliated financial institution to the Bank, were also detached. After this, ABC started its transformation into a wholly state-owned commercial bank. On January 15th, 2009, the Bank changed the registration with the Industrial and Commercial Bureau and was transformed in its entirety to a joint-stock company, i.e., Agricultural Bank of China Limited.
The year of 2008 witnessed a rapid growth of ABC with enhanced operational efficiency and improved asset quality. ABC's net profits in 2008 increased to RMB 51,453 million. Meanwhile, the total assets stood at RMB 7,014,351 million with total deposits of RMB 6,097,428 million and outstanding loans at RMB 3,100,159 million. Underscoring ABC's prudential operating approach and commitment to sustainable franchise development, ABC's non-performing loan (NPL) ratio is 4.32% and capital adequacy ratio is 9.41%. With the largest network across China and an advanced IT system, the Bank is able to provide convenient, efficient financial services to over 350 million clients. Currently, ABC has 24,064 branches, sub-braches and outlets, 30,089 ATMs and has established correspondent banking relationships with 1,171 banks worldwide.
In 2008, ABC took the 223rd place in the Fortune Global 500 and was rated A1/Stable by the Moody's.
ABC is committed to serving agro-related sectors and dedicated to providing first-class financial services to both urban and rural clients. With full international capabilities, an innovated business model and prudential operations, the Bank provides tailored services to communities both at home and abroad. Based on its large physical and electronic network and diversified products, ABC is striving to build itself into a modern universal bank with a sustainable development outlook.

About Temenos

Founded in 1993 and listed on the Swiss Stock Exchange (SIX: TEMN), Temenos Group AG is a global provider of banking software systems in the Retail, Corporate & Correspondent, Universal, Private, Islamic and Microfinance & Community banking markets. Headquartered in Geneva with 58 offices worldwide, Temenos serves over 1000 customers in more than 120 countries. Temenos’ software products provide advanced technology and rich functionality, incorporating best practice processes that leverage Temenos’ experience in over 600 implementations around the globe. Temenos’ advanced and automated implementation approach, provided by its strong Client Services organisation, ensures efficient and low-risk core banking platform migrations. Temenos is top of the IBS Sales League Table 2009, winner every year since its launch of the Best Core Banking Product in Banking Technology magazine’s Readers’ Choice Awards and ranks 26th in the American Banker top 100 FinTech companies Temenos customers are proven to be more profitable than their peers: data from The Banker – top 1000 banks shows that Temenos’ customers enjoy a 54% higher return on assets, a 62% higher return on capital and a cost/income ratio that is 7.2 points lower than non-Temenos customers. For more information please visit www.temenos.com

Temenos contacts:

Max Chuard
Temenos Director
Corporate Finance & IR
Member of the Executive Board
Tel: +41 (0) 22 708 1157      
Email: mchuard@temenos.com

Petra Shuttlewood
Temenos PR Manager
Tel: +44 (0) 207 423 3751
Email: pshuttlewood@temenos.com

Ben Robinson
Director, Strategic Planning
T:  +41 (0) 22 708 1535
M: +41 795 207208/ +44 7803 887929
brobinson@temenos.com

Claire Barry
Hudson Sandler for Temenos
T +44 (0)20 7710 8940
Email: cbarry@hudsonsandler.com 

Lucy Willatt
Hudson Sandler for Temenos
T +44 (0)20 7710 8912
Email: lwillatt@hudsonsandler.com