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Real-Time Enterprise Liquidity Maximizing margins, reducing risk, advancing business objectives Jerry Baulier CTO Intraday Liquidity Management Liquidity has to be available: – at the right time – in the right place – in the correct currency 2 Intraday Liquidity Management: Situation Many disparate systems Manual processes Time delays This lack of real-time information & accurate forecasting results in – excess liquidity (i.e., sub-optimal yields) – excess borrowing (i.e., increased costs) 3 Benefits of Liquidity Management Maximize margins – Dynamically forecast cash with precision – Minimize uninvested cash – Minimize funding cost – Maximize yield on investments / assets Reduce risk – Provide integrated view of liquidity / exposures – Avoid surprises, regulatory fines, and reputation risk Advance business objectives – Deliver integrated view of customer positions – Adapt rapidly to customer behavior and events 4 Desired State Systems connected in real-time Sophisticated predictive knowledge for intraday forecasting Forecasted receipts and payments tracked and replaced with actual Tight connection between funding desk and payments Internal DDA Debt Trading ALCO Custody INFLOW OUTFLOW NET FORECASTS XXX XXX XXX ACTUAL XXX XXX XXX XXX XXX XXX NET 5 External NOSTRO WEB SWIFT The Aleri Liquidity Management System (ALM) • 30+ different systems • Streaming and static • Real-time position management • Actual and forecast positions with drill-down • Payment flow control • Highly customizable Accounting Systems Authoring Environment RTGS Gateway SWIFT Gateway Lending Systems INPUT STREAMS Payment Systems Aleri Streaming Platform Streaming Output On-Demand Queries Data Migration OLAP Database Settlement Systems Clearing Data 6 • Real-time OLAP • Queries across operational and historic data Aleri Liquidity Management – 85 “streams” at Barclays 7 Why Event Processing Platform for ALM? Traditional RDBMS technology can’t deliver the performance: – Complex data model, transformations, correlations, and analysis – Maintain all “Materialized Views” (e.g., account positions) in near-zero latency Like RDBMSs, stream processing platform must also deliver: – Retention of large data sets (5 days of transactions) – On-demand SQL query access to retained data – Security (authentication, encryption, access control, audits) Plus data integrity & flexible/fast data state recovery – Persistent source/sink queues – Synchronous data commits with minimal performance overhead – Data retention with optional (local) persistence 8 Barclays Giving them a real-time consolidated view of liquidity Situation • Barclays has large volumes of payments and receipts across business units, currencies, and geographies • They didn’t know where they stood and had large buffers in place to ensure all obligations could be fulfilled • There was risk from manual processes and time delays of not knowing their positions in real-time • They had over 30 systems where this information resided and it was not an option to rip out and replace those Risk Requirements • Prior to the solution there was a significant potential for reputation risk should there ever be situation where obligations could not met due to poor liquidity management • To access information in real-time from the 30 plus systems • To persist the data • To hold the data for analytic analysis to improve predictive forecasting • To track payments and receipts throughout the lifecycle from forecast, to processing, to final settlement Solution System that can access the different inputs (30+ systems and 80+ actual streams of data), apply normalization and filtering logic to that information, provide real time data with ad-hoc query capability, and a historical database for trend analytics 9 Key Features Benefits • Consolidated single access point to monitor and forecast intraday liquidity positions • Ad-hoc query analysis for drill down research • Historical database with OLAP • Reduced funding costs • Reduced risk from timing delays and manual processes • More value add understanding of how customers use cash on an intraday basis Jerry Baulier, CTO [email protected]