SAS, the leader in business intelligence (BI), is once again ranked as the leader in the operational risk management software market by Chartis Research (www.chartis-research.com). This is the second year in a row that Chartis has undertaken a global study of this specialised market, and it has positioned SAS as number one for "breadth of functionality" and "market penetration".
This news follows recent product enhancements and major wins. SAS has recently announced the availability of an updated version of its operational risk solutions SAS OpRisk Monitor and SAS OpRisk VaR (Value at Risk).
SAS OpRisk Monitor is a Web-based application that collects, manages, tracks and reports information about operational loss events, key risk indicators, and risk and control assessments; SAS OpRisk VaR is a sophisticated, user-friendly analytic VaR calculation application that slices, dices, drills down, adjusts, trends and plots operational loss data at will, following a fully transparent, intuitive and sequential process. Enhancements to these solutions include updated risk and control self-assessment, improved dimensional management, more powerful scenario analysis, enhanced key risk indicators and better integrated reporting.
At SAS Forum International, the leading BI vendor's customer event that took place from 16 to 18 May in Geneva, Peyman Mestchian, Director of Risk Management at SAS's European headquarters, explained: "The market for operational risk management software is still developing. In recent months, we have seen a number of the early movers in this market being acquired or exiting the market altogether. Often this is due to poor cash-flow management and financial instability, but the underlying cause is lack of flexibility in the technology architecture. Flexibility is the key in this market, as financial institutions are adopting a variety of methodologies and approaches for managing operational risk."
According to SAS, the Basel II framework and the pending Solvency II directive of the European Union make operational risk management a requirement.
The head of SAS's risk practice also pointed out that those organisations that are looking beyond compliance are likely to reap the full benefits of SAS risk technology. "SAS's fully integrated risk intelligence platform addresses these challenges by providing a technology architecture that ensures that regulatory compliance investments also deliver bottom line business benefits," said Mestchian.
SAS's platform contributes to long-term cost savings while helping ensure that data is clean and accurate and that it delivers predictive insight. Each of the products in SAS's suite of risk solutions is built on the SAS Enterprise Intelligence Platform, meaning financial institutions can benefit from a fully integrated business intelligence architecture that is standards-based and open across the enterprise. Ultimately, this enables financial institutions to take an integrated approach to key business issues such as risk management, regulatory compliance, customer retention, and cross-sell and up-sell, while minimising project risk.
SAS's success in operational risk management
In September 2005, SAS was positioned by Gartner Inc in the Leaders Quadrant in the Basel II Risk Management Application Software Magic Quadrant[1] report. According to the report, "leaders" are vendors that have a proven track record in Basel II vision and business investment, which indicates they are well-positioned for the future. Leaders do not necessarily offer the best products for every customer project, but they do provide solutions that offer relatively lower failure risk. Leaders in this market have paired advanced technology with broad offerings or have specific, rich functionality.
In October 2005, the Association of British Insurers (ABI) selected SAS as its strategic partner to develop the Operational Risk Insurance Consortium (ORIC), a new international initiative to help the insurance industry pool and analyse operational loss events that have been collated by a growing number of insurance companies. The ORIC database, which helps improve understanding and management of data, as well as assisting with regulatory requirements, provides quarterly information on losses due to human error, external events and failed processes or systems, by both monetary amount and narrative description of the event. Current members of ORIC include AXA, Friends Provident, HBOS, IAG, Legal & General and Standard Life.
In March 2006, SAS reached a critical milestone with more than 100 Basel II wins across the globe. These include operational risk as well as credit risk projects with such organisations as Merrill Lynch, Gruppo Santander, Hypovereinsbank, Commerzbank, BB&T, HBOS, HSBC Holdings, ING Belgium, Soci'et'e G'en'erale Group and Kookmin Bank.
SAS and HSBC Holdings plc, one of the world's largest plastic card issuers, are demonstrating industry thought leadership by developing a new real-time fraud detection platform. Both companies have been working closely together in order to go live later in 2006. In July 2005, SAS and HSBC announced a long-term partnership to transform the payment card fraud-detection market.
On 15 March 2006, SAS announced the latest version of SAS Anti-Money Laundering, which now provides advanced analytics to better display the flow of funds between accounts so banks can be more effective in identifying suspect relationships and high-risk accounts. Landbouwkrediet - Cr'edit Agricole (Belgium) and Sky Financial Group (USA) are the latest customers for this solution.
With its market, credit and enhanced operational risk solutions in conjunction with its financial crime solutions, SAS provides the most comprehensive offering for enterprise risk management and regulatory compliance. The key to SAS's success is that all its risk solutions are built on a single common platform, providing a cost-effective and practical alternative to buying multiple and costly piecemeal risk systems that result in integration and data management issues.
[1] * Gartner Research "Magic Quadrant for Basel II Risk Management Application Software, 2005" by David Furlonger and Douglas McKibben. 16 September 2005.
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The Magic Quadrant is copyrighted September 2005 by Gartner, Inc and is reused with permission. The Magic Quadrant is a graphical representation of a marketplace at and for a specific time period. It depicts Gartner's analysis of how certain vendors measure against criteria for that marketplace, as defined by Gartner. Gartner does not endorse any vendor, product or service depicted in the Magic Quadrant, and does not advise technology users to select only those vendors placed in the "Leaders" quadrant. The Magic Quadrant is intended solely as a research tool, and is not meant to be a specific guide to action. Gartner disclaims all warranties, express or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose. This Magic Quadrant graphic was published by Gartner, Inc as part of a larger research note and should be evaluated in the context of the entire report. The Gartner report is available upon request from SAS.
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