Joe Dunphy VP Product Management - Fenergo Managing the impact of Regulatory Change on bank processes and technology Joe Dunphy VP Product Management - Fenergo

About Fenergo Fenergo Overview Client Lifecycle Technology company focused on legal entity data management, regulation and client & account related workflows for Investment, capital market and private banks. Enabling financial institutions to ensure global compliance with regulations such as KYC, AML, Tax (FATCA & CRS), Derivative Reform (Dodd-Frank, EMIR, Canadian & APAC deriv. rules), through a community based approach to solving regulation. 32 FIs live on our software, with 18 current active FI implementations. We have 1 agenda: To serve the Client Lifecycle Mgmt. space and become “The Standard”. The Fenergo business has grown on avg. 100% yearly for the past four years, culminating in Insight Ventures and Aquiline Partners investing €75m to fund growth in the summer of 2015. Headquartered in Dublin, with offices in the New York, Boston, London, Singapore, Abu Dhabi Sydney and Wroclaw. Fenergo are a specialist team of 300 Entity Data, KYC, Tax, Derivative and COB technology specialists.

Counter-Terrorism/AML Regulatory Storm Counterparty Risk Global Tax Counter-Terrorism/AML Market Abuse Volume of New Requirements OTC Derivatives, BCBS, EMIR, FATCA, CRS, 4th EU AMLD, Patriot Act, Margin, MiFID II, GDPR ...... Managing Regional Variations Scope Overlap: e.g. Dodd-Frank, Canadian Derivatives, EMIR, OTC Asia Pac Implementation Timeframes Tight timeframes, changing scope, large areas of business impact Cost and Service Impacts Increased customer requirements, longer onboarding timeframes, inefficient legacy processes FATCA Global Tax; 3rd AMLD 4th AMLD; MIFID MiFID II Competing Challenge: COO, Head of Compliance, CEO, Front Office

Ongoing Regulatory Change Ever growing regulatory environment

How are banks addressing the challenge? Consolidated delta-based solutions Integrated Lifecycle Model Rules-based configuration Centralisation of Functions Community approach

Re-use: Manage the Delta AML / KYC Dodd Frank FATCA CRS EMIR…. Legal Entity Name, Address, Entity Type, Entity Role & LEI Legal Entity Name, Address, Entity Type, Entity Role & LEI Entity Associations & Party Relationships Traded Products, Accounts & Booking Entities Documents: Cert of Incorporation, Beneficial Ownership, Trading Agreements PEP Data EBC Protocol 1.0 GIIN Tax Residency EMIR Classification Sanctions Screening Swap Docs 2.0 FATCA Classification Self Certification Clearing Exemption Risk Scoring DF Protocol& Compliance FATCA Docs W8\W9 Reportable Jurisdictions EMIR Reporting Req Single & Consolidated Party Data Regulatory Store

Integrated Client Lifecycle Management Bank trading platforms Entity Data CRM Client Lifecycle Events New client Existing Client Reviews Maintenance Client Offboarding New Product Account Fund KYC Utilities Regulatory rules and classification framework Dodd Frank EMIR MAS HKMA ASIC FATCA KYC PEP / Sanctions AML Risk assessment Market access KYC Consume Bank’s Firewall AML Data Understand CRS Route Entity Data Management Client Data / SCD Hierarchies KYC / AML Data Classification Account Setup Industry Data ISDA AMEND Reporting Platform SSI’s Operational Data Management Authorised Actions Trading Agreements Contract Management Managed Accounts SSIs 8 7

Rules Engine Execution Client Lifecycle  Driven by Bank App UI or Fenergo UI Request Initiation OB and KYC Credit Ops Legal Workflow & Rules Engine (Tightly Coupled) Decision Criteria LE Type LE Role Traded Product Booking Point Jurisdiction KYC Risk Rating Factors SDD Vs EDD KYC question set Classification MLRO Credit Credit Required: Y\N Routing rules\limits Operations Checklists Documents Approvals Legal ISDA Required Compliance checks Business Rules Engine Decision Table Workflow Table Documents Classification Types Details

Centralisation The Big Picture Challenges Technology Toolset Shared/managed service approach KYC and AML directives Reporting obligations – CRS / OTC BCBS 239 Data Residency Requirements Confidentiality Countries Offering a Comparable Level of Protection Data Masking Data Access Restrictions Protection of Associated Entities Jurisdictional rules Personally Identifiable Information Localisation Local data protection and privacy laws Lack of uniformity Non-contracted 3rd parties Splashscreen validation Confidential Clients / Confidential Deals Inheritance

This design is reviewed and approved at the Forum Community Approach Regulatory Lifecycle – a community approach Monitor Monitor upcoming regulatory change and tracks via the regulatory roadmap. The roadmap is shared with the Forum and timelines, approach and content is debated and validated Initial Proposal Regulatory analysis team create initial proposal for review and debate at Forum. The proposal is refined in line with the Forum direction Detailed Design Regulatory team work with analysts and nominated Bank SMEs to produce detailed product design specifications. This design is reviewed and approved at the Forum Product Delivery Deliver the new functionality as an update to the product / systems in advance of the regulatory deadlines. (Bank SMEs remain involved for review and direction throughout the delivery process) Implementation The new functionality is rolled out for implementation to allow adherence to the new regulatory requirements.

There is no neutral option – every decision makes it better or worse Final Thoughts There is no neutral option – every decision makes it better or worse Look beyond the immediate tactical requirements of each regulation to create an extendable strategic approach OTC Patriot Act / 4th AMLD KYC AML FINRA BCBS 239 Regulatory Framework Risk Ass. TAX Extendable Framework FATCA MiFID Client Classifications Flexible regulatory Framework supporting all regulatory rules & classifications APAC OTC Deriv. Reform CRS / CDOT

Thank You Visit Us on Stand #12 Thank You e: info@fenergo.com w: www.fenergo.com or follow us on: Global Headquarters: Ormond House, Ormond Quay, Dublin 7, Ireland United Kingdom: 200 Aldersgate, London, EC1A 4HD North America: 5th Floor, 1177 Avenue of the Americas New York, NY 10036 North America: 470 Atlantic Avenue, Suite 4051 Boston, MA 02210 APAC: Level 57, MCL Centre, 19-29 Martin Place, Sydney, Australia, NSW 2000 Thank You