Flexible, Lean and Integrated Banking Software from SAP Addresses Today's Business Processes, Helping Banks Better Manage Risk and Drive Competitive Advantage

WALLDORF, Germany, Dec. 7 /PRNewswire-FirstCall/ -- Further extending its modular, market-leading solutions tailored for the banking industry, SAP AG (NYSE: SAP) today announced innovations to its industry-specific banking software that supports banks' business processes from the front to the back office. The new release of banking services from SAP directly addresses the needs of banking customers in today's market. In the face of amplified risk exposure and strict cost-cutting measures, banks must rely ever more on their IT systems to easily, cost-effectively and better assess and manage risk while accelerating product and service introductions to gain and maintain the edge on their competition. Innovations to the integrated banking services were designed to help banks gain greater transparency across their organization, more sharply focus on providing value-added customer offers, meet the constantly changing demands of regulatory compliance and manage new growth opportunities. Meeting its product road map commitment made in 2008, SAP confirms that customers are already ramping up their process on the new banking services from SAP, which were released to select banks worldwide in September 2009.

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The newest improvements to the banking services from SAP delivering transactional and analytical banking solutions tap continuous innovations from close collaboration in more than 1,000 banking customer projects, as well as SAP's participation in industry groups and standards bodies, such as Banking Industry Architecture Network (BIAN). Offering scalable solutions based on a flexible platform, SAP is committed to helping banks take a low-risk path to lower operational costs and improve customer service.

Innovations for Banks, Designed by Banks

The comprehensive portfolio of modular banking solutions from SAP is based on service-oriented architecture (SOA) to enable banks to extend their investments in existing systems for better operational clarity. The current portfolio includes enterprise management solutions and transactional banking solutions, as well as risk management and compliance solutions. Including enterprise services built-in specific to the banking industry, the SAP solution enables banks to significantly reduce the amount of time spent on daily tasks, as well as gives banks the opportunity to reuse the services for other channels, such as mobile, terminals and direct banking. With the newest improvements, SAP delivers significant innovations in new functionality and key features in the area of integration, service enablement and platform openness, including the following:

Achieving Operational Excellence With Transactional Banking
 Solutions from SAP
--Operational and Organizational Collaboration for Improved
   Customer Service
 Updated functionality in the SAP(R) Deposits Management application
 provides a stronger integration between a bank's operations and
 its sales functions. This enhanced functionality offers sales
 operations a better view into customers' deposit accounts,
 enabling sales representatives to offer products and services that
 best meet the individualized needs of their customers at the
 point of sale, giving the bank an edge on its competition. The new
 functionality helps heads of operations contain cost and increase
 efficiency when deposit account volume increases.
-- Improved Loans Management
 Utilizing innovations from SAP(R) Business Suite 7 software, the SAP(R)
 Loans Management application has been upgraded to offer end-to-
 end automation of all loan-relevant processes from origination to
 contract. This enhancement will help reduce a bank's time to
 market for new products and facilitate more efficient processing
 of high-volume business, moving a bank one step ahead of its
 competition. The SOA-enabled capabilities of SAP Business Suite
 offer banks the opportunity to make their IT systems more modular
 and open the door for running IT in the cloud, using services from
 multiple vendors on-demand as well as on-premise. In addition,
 banks are able to use and re-use semantically rich business
 content, making it faster and easier to innovate business
 processes. SAP Business Suite customers have access to more than
 2,800 enterprise services for easy consumption. These services can
 be composed into consistent and stable business processes that
 help reduce project costs for implementing "own practices" that
 operate in both heterogeneous and hybrid IT landscapes.
-- Flexible Collateral Management for Changing Demands
 Solutions that are agile and flexible can create one point of truth
 for a bank when it comes to managing its collaterals. This is
 particularly important in today's market, where financial
 institutions are facing stricter regulations and mounting
 competition. Banks' collateral management practices have become
 too cumbersome to meet new demands. The SAP(R) Collateral Management
 application has undergone significant innovations to address the
 many issues banks are encountering in the changing market. Such
 improvements build connections among business units at a bank to
 help them enforce collateral norms; for example, the lending
 segment head can then get consolidated information on exposures,
 the collateral asset manager can cost-effectively manage
 collateral for the entire organization and the credit risk manager
 can oversee and help enforce collateral risk policy.

Controlling Risk Through Financial Excellence With SAP Solutions
-- Better Meeting Basel II Requirements
 Enhancements to the SAP(R) Basel II application will help banks meet
 the Basel II requirements for risk exposure and capital adequacy,
 as well as implement new supervisory review and disclosure
 processes. The solution integrates internal and external credit
 risk management on a single platform and supports all Basel II
 approaches for credit risk calculation - from the standardized
 approach to the advanced internal ratings-based (IRB) approach.
 Such enhancements will give banks a secure foundation to help
 ensure regulatory compliance for the safety of their end
 customers.
-- Pricing Package for Managing Credit Risk
 The SAP(R) Credit Risk Portfolio Management application is a new
 pricing package as part of the SAP for Banking portfolio of
 solutions. The new application enables banks to quantify credit
 risk on a portfolio level that includes views to actively manage
 their credit risk. The new pricing package will provide banks
 foresight to manage their risk in order to protect themselves from
 economic pitfalls. The application addresses the economic capital
 approach to credit risk and complements the SAP Basel II
 application to cover regulatory capital perspective.
-- Integrated Financial and Management Accounting
 With integrated accounting solutions from SAP, a bank's chief
 financial officer can confidently deliver timely and accurate
 financial reports that are automatically reconciled with internal
 management reporting. Solution innovations include the ability for
 banks to integrate financial and management accounting processes
 for reconciling their reporting across all divisions. The
 solutions provide banks with a full sub-ledger functionality for
 financial instruments, which includes the valuation and posting of
 financial instruments in accordance with International Financial
 Reporting Standards (IFRS). In collaboration with the SAP(R)
 Accounting for Financial Instruments application, SAP
 Profitability Management application has been enhanced to provide
 banks access to comprehensive profitability information on a
 granular basis. This enables banks to fulfill external and
 internal accounting and reporting requirements.

Banks Have Clear Path to Help Master Financial Crisis

The new release of banking services from SAP was designed and executed based on the needs of customers today and tomorrow. Faced with the urgency to change, banks must attain clarity and transparency by using a portfolio of IT solutions that help them close the gap between strategy and execution, thereby optimizing the performance of their business and network. The SAP solutions provide the required insight for improved performance, efficiency for optimized operations and flexibility to quickly adapt to changing circumstances.

"The new release of banking services is just the latest example of SAP's ongoing commitment and investment to provide the leading banking platform available in the industry that enables our customers to truly innovate and transform their business and IT models," said Don Trotta, senior vice president and global head of financial services industry, SAP AG. "Working closely with our customers, we have been able to incorporate a rich new set of features and functions in the release that will greatly help them address some of the most critical demands they are facing now - greater efficiency, flexibility to change, and better insight into their business and customers. This is why we have seen such momentum in the marketplace for SAP banking solutions over the past few years. With this new release, we see that momentum growing and accelerating as more banks understand what it can do for them."

Service-Oriented Architecture Road Map for Banks

SAP believes that through tight collaboration with the market for the definition and adoption of semantic industry standards on SOA, banks globally will be able to better respond to changing customer needs and reduce risk and cost of re-engineering legacy systems towards a more flexible operational environment. Based on broad consensus from within the banking industry, this will enable faster, more efficient strategic and operational changes in banks while helping banks to address the key market imperative to drive cost reductions through greater efficiency and organizational flexibility.

Playing an active role in the independent association Banking Industry Architecture Network (BIAN) , SAP will provide banks the enterprise services that best fit their needs, because the services are built and designed by peer banks. Pre-defined services will allow SAP customers in the banking industry to quickly build and deliver new products and services to their customers, without having to invest heavily in integration costs. As a committed member of BIAN, SAP is adapting the standards and methodologies developed by the association into its product road map of banking solutions to help its customers transition their business operations into a more flexible and agile IT environment.

"ZKB is convinced that standardization in the financial industry will also include the software development and operations," said Dieter Buhler, head of IT-Architecture, LAT, Zurcher Kantonalbank. "As a leading Swiss bank, ZKB will be part of this standardization process and proactively make a contribution to it."

Worldwide Banks Rely on Banking Solutions from SAP for Better Operations

Supporting 21 of the 30 largest banks globally, SAP is a clear choice for banks looking for innovation solutions built for their needs to address their specific industry challenges. Banks using SAP software include: Banco Galicia (Argentina), Farm Credit Canada, Nationwide (UK), Postbank (Germany) and Standard Bank (South Africa).

About SAP® for Banking

The SAP® for Banking solution portfolio provides banking-specific (transactional banking, customer relationship management, and finance and risk management) and banking-relevant (human resources management and procurement) services and solutions created on a single SOA-enabled business process platform with integrated business insight. Solutions are delivered in areas such as Analytical Banking (Integrated Finance and Risk, and Compliance), Transactional Banking for retail and wholesale banks (Loans, Deposits, Payments, Collaterals, Leasing, and Covered Bonds), Business Support (Procurement and Human Capital Management), Customer Relationship Management, and Business Intelligence. With more than 800 customers in 73 countries worldwide, SAP for Banking provides an integrated set of tools and supports automated processes to manage every aspect of the front- and back-office banking environment-from high-volume transactional banking processes and customer relationship management to financial accounting, cost controlling, and profitability and risk analysis. SAP for Banking helps companies expertly manage transactions and relationships across the entire enterprise to quickly identify and exploit market opportunities and easily tailor new products to the specific needs of individual customers. Additional information is available at http://www.sap.com/industries/banking.

About SAP

SAP is the world's leading provider of business software(*), offering applications and services that enable companies of all sizes and in more than 25 industries to become best-run businesses. With more than 92,000 customers in over 120 countries, the company is listed on several exchanges, including the Frankfurt stock exchange and NYSE, under the symbol "SAP." For more information, visit www.sap.com.

(*) SAP defines business software as comprising enterprise resource planning, business intelligence, and related applications.

Any statements contained in this document that are not historical facts are forward-looking statements as defined in the U.S. Private Securities Litigation Reform Act of 1995. Words such as "anticipate," "believe," "estimate," "expect," "forecast," "intend," "may," "plan," "project," "predict," "should" and "will" and similar expressions as they relate to SAP are intended to identify such forward-looking statements. SAP undertakes no obligation to publicly update or revise any forward-looking statements. All forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect SAP's future financial results are discussed more fully in SAP's filings with the U.S. Securities and Exchange Commission ("SEC"), including SAP's most recent Annual Report on Form 20-F filed with the SEC. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their dates.

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