Banking Software: Term Deposits

Term Deposits: The Opportunity and the Challenge

Raising capital at the lowest possible cost to fund lending products is what drives the term deposit business. The concept is simple but there are a number of challenges. You need tactical and strategic intelligence to keep your finger on the pulse of your business. Portfolio Plus gives you what you need to manage the day to day and long term outlook for your term deposit business.

Term Deposits: Key Success Factors

Term Deposits: A Complete Workflow

Portfolio Plus provides a complete workflow for selling and processing term deposits. This includes receipts, certificates, interest cheques, commission processing, principal cheques, electronic payment processing and general correspondence.

A Term Deposit Sales Network: The CANNEX Service

In Canada, connectivity with the CANNEX service is helpful for those who want to sell or advertise term deposits and rates through third party agents. Portfolio Plus integrates with the CANNEX service for rates, deposits, redemptions, interest payments and commission payments.

Term Deposits: Integration with Portfolio Plus Modules

Term Deposit Brochure

Portfolio Plus, with its Plug-In Banking architecture, makes it easy to integrate the Term Deposit module with other Portfolio Plus modules like Portcullis (web banking), Retail Banking, Investment Management and the Loan and Mortgage module.

Examples of this integration are:

• Term Deposits: Integration with Retail Banking
• With the Portfolio Plus Retail Banking module, transfers can be made to and from retail accounts for term deposit purchases, interest payments and redemptions. The Term Deposit module also supports PAC and PAD interfaces for Pre-Authorized Credit and Pre-Authorized Debit transactions with other financial institutions.
• Term Deposits: Integration with Investment Management
• Using the Portfolio Plus Investment Management module you have the ability to manage term deposits as part of a registered plan (RRIF, RRSP, RIF), or non-registered investment plan. The appropriate transactions for initial investment, payments of interest and principal are maintained within this investment plan.
• Term Deposits: Integration with Real Time Accounting
• The Term Deposit module of Portfolio Plus creates journal entries, in real time, to the accounts you have specified in the term deposit product set up information. You can choose exactly when these entries are posted to the general ledger and run trial balances as required. All activity associated with the Term Deposit module is audited.
• Term Deposits: Integration with Legacy and XML
• In some cases you don’t have the luxury of installing a 100% Portfolio Plus solution. In this case you can choose to integrate with your legacy systems using the Universal Gateway, another important component in the Plug-In Banking^TM architecture. Using technologies like XML and advanced messaging JMS middleware, Portfolio Plus can be integrated with legacy systems on a high performance messaging backbone.

Term Deposit Origination Process: Direct Entry Option

There are a number of ways in which you can accept term deposits within Portfolio Plus. If you have the Portfolio Plus Retail Banking module or the Portfolio Plus Portcullis (web banking) module, you can allow your customers to purchase term deposits face to face, using a teller as the sales agent, or via a web banking interface. Alternatively, you can also allow for walk-in business for a non-retail banking environment. In this case you can directly enter the term deposit information and accept payment using the Direct Entry method. This method leads you through the necessary steps to gather identification details, principal amounts, rate, payment frequency and method of payment.

Term Deposit Origination Process: Automated Batch Entry

If you use an agent network to sell your term deposits, or acquire an existing term deposit portfolio, you can use the Batch Entry method to easily enter them into Portfolio Plus. This allows for an unlimited number of deposits to be entered in one or more batch loads. Once the batch is validated the entries are then accepted and activated as term deposits within Portfolio Plus.

Regulatory Reporting

The Portfolio Plus Term Deposit module includes a complete set of regulatory and taxation reports. These reports (for Canada) include:

Revenue Canada Tax Reports:

Regulatory Reports for Financial Institutions:

Rapid Product Creation with Parameter Powered Products

Portfolio Plus delivers the power of speed to market with a parameter powered product concept that banking analysts have been championing for years. Your system won't have to be enhanced every time you want to bring a new product to market. There is no waiting for a software vendor to provide an update. You are in control.

In the case of term deposits, you are able to define rates, commissions, and all variables associated with a term deposit, with no software changes to your system.

Term Deposit Administration

Throughout the life of a term deposit, there are occasions when an existing deposit requires a fundamental modification, due to an input error or a communication error with the customer. Term deposit administration allows for the updating of deposit information relating to any financial information such as principal amount, term, or rate. The primary function in this section is to allow a knowledgeable administrator or supervisor to override and adjust a term deposit set-up (human) error.

In addition, the administrator of any term deposit system must manage renewals, redemptions, cancellations, assignment and transfers of deposits. These functions are available, in real time, using the Term Deposit Administration function. The administrator is also free to print certificates and receipts on an individual basis.

Strict Auditing & Security

The combination of user and group-based security, in addition to strict auditing on all changes made to the system, help you ensure the integrity of your business. All changes to term deposits, and other financial data within Portfolio Plus, are strictly audited with the user name, time and the date changes that were made.

The Term Deposit module allows you to customize security for each of your employees. The System Administrator establishes the security parameters for each user, or group of users, and permits access to the system within these parameters. Access can be restricted to query capabilities only, entering information, printing reports, user dollar limits, etc., or any combination of functions, as determined by your company's requirements.

Term Deposits: Payment Processing

The Term Deposit module contains a complete set of functions for processing payments for interest and principal. You have the option of processing payments as pre-authorized payments to an account of the customer's choice or by cheque. Cheques can be issued one at a time, or in a batch format.

Before you actually process payments, you can review them in the form of proposals. This is an opportunity for you to catch any irregularities before a payment is created.

Term Deposits: Customer Relationship Management and Support

Portfolio Plus uses a Customer Information File (CIF) to help you manage clients and provide rapid response to their queries. Within the Term Deposit module you can query for customer information using their name, certificate number, cheque number or payment due date. Once you’ve located the customer's information you can drill down to specific payments or events that relate to any term deposits a customer may hold.

In addition to term deposit information, you can cross-reference other holdings the customer may have. This includes cross-references to mortgages, registered plans, lines of credit and retail banking accounts. From a customer relationship standpoint, you can quickly gain a complete view of your customer's holdings enabling you to serve them better while also providing an opportunity for your employees to sell more product.

Term Deposits: Working with Agents and Sub-Agents

Portfolio Plus allows you to create and maintain agent profiles to make it easier to perform repeat business with agents, and groups of agents, who sell your term deposits. You have the power to customize commission percentages to account for unique relationships you may have with an agent or group of agents. The Term Deposit module allows you to process all interest and principal through the agent or directly with the client. You have the same option with tax statements. Tax statements can be sent directly to the buyer of the term deposit or to the agent that sold the term deposit.

To help manage your agent-centric business you can run regular reports on activities for each agent that includes commissions, overall sales, geography, and more.

Term Deposit: Reporting

Exception Reporting is used to detect when senior personnel have overridden term deposit rates, changed dates, or performed any other action that is outside the normal settings for a particular term deposit.

Transaction Listings: Your trial balance from the previous day, combined with today’s transactions, should be equal to the current trial balance. If this is not the case, this report helps you discover why (e.g. a term deposit transaction that spans two quarters).

In addition to Exception Reporting and Transaction Listings, the Term Deposits module of Portfolio Plus offers many other reports to help you manage your business:

• Daily Entry Summaries:
• You’ll know what entries have been made to the term deposit system that day.
• Issues Registers:
• This report tells you how many term deposits were issued, within any time span you specify.
• Maturity Forecasts:
• This tool will help manage your cash appropriately as it will provide a forecast of outgoing capital.
• Renewal and Redemption Registers:
• This report provides the data on renewal and redemptions over a time period that you specify.
• Client Audit Trail Reports:
• This report would help you identify any behaviour that is not within your guidelines.

Management Reporting

Management Reporting provides reports for use in your portfolio analysis and product performance.

Some examples of this type of reporting are:

• Trial Balance
• Daily and Monthly Transaction Activity
• Liquidity Reporting
• Accrued Interest Reports

Customer Correspondence

Managing a term deposit business requires correspondence to be produced throughout the lifecycle of each term deposit. As such, you'll need to produce maturity notices, customer statements, system audit letters and social insurance requests. Portfolio Plus allows these types of reports to be produced on demand, one at a time, or in batch mode. In addition, you can utilize the Portfolio Plus Office Link product to create these reports using Microsoft Word templates that you control. With Office Link you have control of the fonts, graphics and aesthetic appeal of each document that is produced.

Accounting Interface

Throughout the life cycle of a term deposit, events are recorded in real time, to the Portfolio Plus Accounting module and can then be posted to the general ledger for Portfolio Plus or posted to an external general ledger. You have control of what journal entries are posted for each type of term deposit product you have created. This allows you to post entries to different companies and currencies depending on the type of term deposit products you’ve created.