Complying with new European banking laws can present organisational and technical challenges to EU financial institutions, as keeping in line with regulatory change can involve significant alterations to policies and processes, as well as methods of interacting with clients. Effective technological solutions to such challenges have been somewhat lacking, until researchers within the eTen project WINS began work. Many of the latest regulations affecting the financial world are designed to protect savers and investors from failure or bankruptcy of the financial or credit institutions in which they invest. Under Basel II, minimum capital requirements have been standardised to ensure such institutions hold a minimum amount of risk capital to protect their investments. Accordingly, WINS participants have developed a web-based business intelligence service for public and private financial institutions, to help them define financial policy and acquire the data required to comply with the credit risk assessment and reporting requirements of Basel II. The system offers products and discovery tools that enable analysts to produce new financial knowledge on companies from data gathered through inter-operable information services. Business intelligence key to high-quality services “The process of transforming raw data collected from operations and customers into usable information is becoming increasingly critical with the new rating systems adopted by financial institutions worldwide,” says Paolo Lombardi of Banca Monte dei Paschi di Siena, the Italian bank that participated in the project and is still using the system. “This business intelligence is key to delivering higher quality services to citizens and to effectively operating Basel II-compliant systems.” The WINS system, he says, supports online business intelligence services through a customisable, service-oriented and generic architecture, with each service treated as a specific instance. At the same time, WINS supports mechanisms that enforce security, while providing the transparency required by the new regulatory system that will be fully effective from January 2008. The project’s flexible business model is what gives WINS its competitive edge. The system is easily integrated through web services and can be used by analysts both as a front-office and back-office tool. “WINS is a cornerstone of a new generation of business intelligence systems for complex organisations, both at central and national banking levels. Basel II is opening up huge opportunities for systems to support banks and other credit institutions in the advanced new risk management systems they are required to implement,” says Lombardi. Tested by the financial community Users that have tested the system include major German credit reporting agencies, SME organisations in Italy and Germany, the Italian Ministry of the Economy and Finance, and INPS, the largest Italian social security agency. Lombardi reports that the WINS pilot “lives on” at Banca Monte dei Paschi di Siena. Other potential customers include credit rating and reporting agencies, data providers, public credit and company account registers, public business registers and export credit agencies, as well as specialised international and government agencies. The WINS consortium estimates the annual worldwide market for multi-industry business intelligence services to be some €20 billion; €6 billion in Europe alone.