Information technology

Total IT costs are allocated to business segments. The IT sector, therefore, does not have its own financial statements.

In 2011, NLB again maintained a high on-line availability rate, which stood at 99.75% in 2009, 99.87% in 2010 and 99.82% in 2011 in annual terms, meaning an increase in announced interruptions (of 0.04%), in part due to a larger number of technical upgrades than the previous year and due to the fact that 596 changes were made in application systems.

NLB continued to consolidate its IT architecture and improve cost efficiency in 2011. The focus of development was on solutions to improve the quality of customer support services, the development of new electronic banking services, ensuring an increased level of operational security and the consolidation of support for corporate customers in T24. NLB continued to take over the maintenance of packages and solutions purchased in recent years as a cost control measure.

Retail banking receives stable support. An important change in retail banking in 2011 was bringing the information regarding customers' financial position and structure of funds in NLB Klik. In addition to new services, the Bank introduced improved security features in NLB Klik, including the implementation of an early fraud detection system that was upgraded and integrated with the stock brokerage system. By continuing with the introduction of e-archiving, NLB is improving the efficiency of back-office services. By developing support for collateral management over the life cycle of loans, the Bank facilitates the necessary compliance with regulations and simplified procedures. Given the changes to legislation regulating consumer loans and to risk management regulations, support controls at bank counters were upgraded. The system for reporting to the SISBON interbank system, which monitors the debt and credit ratings of retail customers, was also upgraded.

In corporate banking, NLB continued adding functionality to products, particularly for nonresidents, with the aim of facilitating the migration of transactions from old solutions to T24 to the greatest extent possible. As a result, less than 4% of transactions remain in one of the old solutions. Key activities in the corporate banking segment were linked to improving support for collateral management and risk management. To that end, one-time solutions were developed to improve the quality of data.

Together with its partners, the Bank successfully introduced the electronic exchange of invoices via a collective processing center and their integration in e-banking. The Bank attracted several major customers, and expects even greater effects from introduced solutions in the coming year.

Regarding the support of payment systems, the majority of activities in recent years were linked to successful adaptations for NLB's inclusion in the standardized SEPA payment system, for which NLB fulfilled and introduced all requirements in a timely manner. IT support to ensure links to the SWIFT system for all NLB Group banks also continued. Like all participants in Slovenia, the Bank terminated the use of some old payment schemes and instruments in 2011, a process that will continue in 2012.

The reduced volume of trading on the financial markets has allowed NLB to re-analyze the processes and support used in securities trading and in linked risk management systems. Development was therefore limited to ensuring compliance as necessary and to integration with the new Xetra stock exchange trading system. The drafting and sending of all SWIFT series 5 reports for custody services were automated in 2011.

The data warehouse remains a crucial element of the Bank's information system, which underwent several upgrades in 2011 to ensure data for managing all types of risks, to ensure a comprehensive approach to money laundering, for the use of financial data from customers' operations for marketing support, etc. A crucial upgrade of the data warehouse was the inclusion of new data for fullfiling the needs of consolidated reporting for the entire NLB Group.

The Bank upgraded several software programs, important among them being the acquisition of an accelerator for making inquiries from the data warehouse: IDAA – IBM DB2 Analytics Accelerator.

With the aim of rationalizing operating costs, NLB continued migrating the BA network to IP connections in conjunction with external partners, and agreed on the outsourcing of mass printing jobs to an external partner. For the same reason, the Bank analyzed the possibility of migrating to virtual workstations, which reduces investment costs in the long term and above all increases the security of end users' data.

The Bank regularly updates its business continuity plan and IT support recovery procedures, and tests them on a regular basis. More active control over the testing of IT support recovery procedures at NLB Group companies was carried out in 2011, for which a standard methodology was developed and introduced.

NLB also continued in 2011 with its more active role in guiding information technology activities within the NLB Group. Going forward, this will allow the NLB Group to develop the appropriate competency centers for a specific solution and to improve the regulation of supplier relations. Uniform IT management standards were developed at NLB Group companies with the aim of standardizing processes. Procedures were introduced in 2011 for the collective purchase of software to manage processes associated with preventing money laundering and terrorist financing and for the first phase of the introduction of contact centers at NLB Group banks. With the aim of optimizing costs, the Bank took a similar approach to centralizing e-mail for all NLB Group companies, and made several software purchases for the entire Group.