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Bank’s income portfolio Fee Based Income - Also called Interest Income A A Accepting Deposits and Lending Loans at Different Interest Rates B B Deposit Account Services ( Safekeeping, checking, etc) A A Lending (Letters of Credit, Letters of Guarantees, etc) B B Trust Accounts (Wealth Management) C C Fund based Income BANK’S INCOME PORTFOLIO

Fee Generating Income – new production methods Fee Generating Activities – Non traditional Deposit Account Services (on line bill pay, ATMS) Lending (Securitization, Servicing) Cash Management 3 3 Investment Banking Securities Brokerage Merchant Banking AN INSIGHT TO FEE BASED INCOME

Investment banking… emystifying emystifying DD

Front Office 1 1 Middle Office Middle Office 2 2 Back Office Back Office 3 3 Investment Banking work is normally categorized into 3 segments INVESTMENT BANKING

RESEARCH SALES TRADING STRUCTURING -Sales job is to call on institutional and HNI investors to suggest trading ideas and take orders -Sales desk then communicate clients’ orders to trading desks -They price and execute trades -They also facilitate structure new products that fit a specific need -Most profitable area -Responsible for majority of revenue -In the process of market making, traders buy and sell financial products -Golden rule followed by a trader ‘Buy Low Sell High’ -The goal of a trader is to make an incremental amount of money on each trade! -Reviews companies and writes reports -Generates no revenues - But its resources are used to assist traders and -Sales force in suggesting ideas to customers -In recent years this relationship has become highly regulated -Relatively recent division -As derivatives have come into play, with highly technical and numerate employees working on creating complex structured products which typically offer much higher margins and returns than underlying cash securities Front Office requires highest caliber employees in terms of intellectual capital and interpersonal skills. FRONT OFFICE

Risk Management Analyze the risk traders are taking on to the balance sheet in conducting their daily trades Setting limits on the amount of capital that they are able to trade in order to prevent bad trades having a detrimental effect to a desk overall MIDDLE OFFICE

-Operations involve data checking trades that have been conducted -Involve most monotonous work at relative low pay -Transacting the required transfers -Ensuring that they are not erroneous -Provides great job security BACK OFFICE

How can we facilitate banks make more money…

Technology Risk Management Developing markets 24x7 desks Integration with other markets PLANNING Research and development Product breadth Currency breadth Innovation Service at ‘door’ steps MARKETING Selection Flexibility Any time / Any where facility Relationship Strategy advice and guidance CUSTOMER SPECIFIC Competitive price Quote speed Settlement Liquidity management SKILL SPECIFIC

Simple ‘Mantra’ Close the Gap with Other Global Markets A A More End Points and Trading Venues B B Facilitate Right Technology Decisions C C

Connectivity choices 1 1 Lower latency 2 2 Execution speed 3 3 High bandwidth capabilities 4 4 Flexibility 5 5 Easier ‘last mile’ access 6 6 Faster data feeds 7 7 Automated & Algorithmic trading 8 8 Higher messaging rates 9 9 Throughput optimization 10 Stable global infrastructure 11 Simple ‘Mantra’ continues…

global market data 1 1 messaging 2 2 news 3 3 history 4 4 analysis 5 5 Access to continuous stream of to ensure successful execution of trading strategies!

Present dilemma… Quick connect with clients, brokers 1 1 Receive orders over financial extranets 2 2 Instant post or match orders 3 3 Respond in milliseconds 4 4 Increasingly nanoseconds 5 5

In a nut shell, facilitate… Efficiency 1 1 Risk Reduction 2 2 Cost Reduction 3 3 Banks will make more money, for sure!

$$$ For more information please contact Guru.Raghavan at or