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Oracle Financial Services Data Warehouse Meets Post-Meltdown Demands

In the wake of the financial crisis, big banks need to go beyond siloed reporting to support rapid risk analysis and stress testing.

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Let's say the debt deal collapses and the U.S. credit rating drops. Perhaps Greece finally goes into default or the next Lehman Brothers-scale institution fails. What will that mean to world's largest banks in terms of credit risk, compliance status, customer mix, and profitability?

Financial institutions can no longer take months to figure these things out. Enter the Oracle Financial Services Data Warehouse (OFSDW), an integrated platform designed for rapid insight and what-if analysis across portfolios, product lines, compliance demands, and internal performance objectives.

OFSDW incorporates everything from hardware, databases, and middleware to myriad financial applications. It's the most comprehensive and coordinated platform available for financial institutions, says Oracle, and the vendor insists it can't be matched by competitors.

Data warehousing demands are ramping up across many industries, but nowhere more dramatically than in the financial services industry. It's no longer a question of simply gathering monthly, weekly, or even daily data for periodic departmental reporting.

"Stress testing and enterprise-liquidity testing are among a whole new class of requirements that are compressing response times and what-if analysis need," said S. Ramikrishnan, group vice president and general manager for Oracle Financial Services Analytical Applications, in an interview. Ramikrishnan visited New York last week to promote OFSDW in the world's financial services capital.

U.S. and European regulators, for example, have been demanding periodic stress tests at large financial institutions since the financial meltdown of 2008. Regulations such as Basel III will make such tests a routine requirement. So what has required hundreds of employees and as long as six months of analysis at some banks will have to be achievable within as little as two weeks, Ramikrishnan said. On the liquidity front, large banks with 20 or 30 million customers will have to track hundreds of millions of cash flows and apply complex computations to gain insight within minutes of market changes, he said.

Oracle says OFSDW cuts the time and cost of sophisticated, cross-enterprise analyses with a unified application portfolio that runs on a common architecture, data model, analysis methodology, and reporting environment. This alone is unprecedented, as it unites disparate applications typically supplied by as many as half a dozen vendors, according to Ramikrishnan. What's more, OFSDW puts these apps on the common hardware and infrastructure of Oracle Exadata, so the apps can exploit the platform's in-database and parallel-processing analysis capabilities.

The results are "stunning," Ramikrishnan claimed. "We've fundamentally shrunk the latency between data loading, execution, and delivery of results," he said.

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