The software will reduce the time it takes to close the monthly accounts from 12 to three days, the bank said. And in an added return on investment Danske expects the package to help it to meet the requirements of a new code of conduct for international banks.
The $3.25m (£2.16m) contract will see the Denmark-based bank scrap a range of financial reporting applications and roll out PeopleSoft's Enterprise Performance Management (EPM) software across its offices worldwide.
Companies use performance management, or analytic software, to measure performance across company divisions and to track customer profitability.
With the global slowdown in technology spending suppliers are keen to push performance management software as way to get better return on IT investment and to drive down costs.
The EPM software, which includes specialist transfer pricing and risk management modules, will take 18 months to roll out across the bank. It will replace a handful of in-house and standard financial software packages used across Danske.
Thomas Johansen, first vice-president of Danske Bank, said, "It will cut the closing of the book cycle for monthly accounts from 12 to three days. To close a book in three days you need best practice in technology. You can only do this with an integrated solution."
Danske also decided to overhaul its financial systems to accelerate responses to shifting regulatory requirements in the global marketplace, Johansen added.
One high-profile example of new regulatory requirements is the proposed Basel Capital Accord - designed to make banks' assessments of their own loans and investments more sensitive to risk.
Under the code of conduct banks that can show an advanced level of risk management will be able to reduce their capital costs. One way to achieve this is by demonstrating sophisticated IT systems.
"About a year ago we said we needed to understand data better and deliver information faster to managers. Our home-grown systems are pretty good on a standard basis but with regulatory requirements and globalisation you need to react faster," Johansen added.
An IBM datawarehouse, currently being installed by Danske, will store the mass of transactional and financial data for the EPM software to analyse.
PeopleSoft, however, provides a datawarehouse as part of the EPM suite for financial services companies, and traffic will be able to pass between the two.
Bank takes steps to cut costs
- Value of contract: $3.2m
- PeopleSoft product called Enterprise Performance Management
- Modules include transfer pricing, risk liability, and activity-based management
- Due to be implemented within 18 months, by November 2002
Main Business Benefits
- Reduces the time it takes to finish the monthly accounts cycle from 12 to three days
- Improves the analysis of financial information and gives managers a more coherent overview of the group's performance.