1. Contributing to Capital market Development
ACSDA GENERAL ASSEMBLY
BAHAMAS , NASSAU APRIL 12TH 2018
Contributing to Capital market Development
Market Transformation Program
April,

2. Content
Amarẃ Project Objective
Colombia Capital Market Value Chain
General Scope
Market Transformation
Stakeholders Map
Project Plan
Risks

3. Amarẃ Project Objective
Contribute to the improvement of Deceval’s international risk rating with an operational, technological and functional restructuring that responds to global securities market standards and mitigates the associated risks.
To support this objective, Deceval will adopt the TCS BANCS solution that will:
Support the company’s operation more efficiently and with a higher quality
Allow to the strengthening of Depository services and business lines
Accelerate the innovation process and foster new services for the industry
Ensure better risk management practices and improve systemic risk control
Allow to meet the standards and principles of the global securities market

4. Colombia Financial Market Value Chain
Intermediary
SELL SIDE /
INTERNEDIARY
BUY SIDE /
INTERMEDIARRY
MERCADO OTC
OTC MARKET
OTC REGISTRY AND TRADING SYSTEMS
DERIVATIVES
MEC
EQUITY
MGC / MILA
SET -ICAP - FX
SEN
OTC REGISTRY
CLEARING HOUSES
CRCC
FX CLEARING
International Operator
CSDS, PAYMENT SYSTEMS – LVPS – SMPS
MILA CSDs
DECEVAL
DCV
CUD
CENIT
ACH

5. General Scope: TCS BANCS CSD Solution Implementation
PROCESSES
TECHNOLOGY
ORGANIZATIONAL
STRUCTURE
World Class CSD Solution, Web based, Real Time processing.
Meeting global principles and standards for financial market infrastructures.
Communications protocol : TCP/IP, SWIFT (ISO15022/20022, Fix, Fix-XML)
Interfaces with other infrastructures using global standards
Data Migration for historical data management
Infrastructure update
Users Security Management
78% adoption of TCS Bancs solution
10 Macro processes, 24 sub processes and 166 procedures impacted
Process restructuring to support new global standards adoption
Organizational Structure and roles must be adjusted or changed according to the new process implementation
91 roles impacted
MARKET
TRANSFORMATION
LEGAL
Operational Model Transformation:
IOSCO – BIS Principles
BIS2 and BIS3 DVP implementation
Communications protocols for transactions handling, information,
and corporate actions processing
New market interactions:
Issuer Services
Financial Infrastructures interoperability
Market participants new information and transactions management
Collateral administration
Value chain process automation and optimization
INTERNAL CHANGE MANAGEMENT
Changes to operating regulations to support new processes
Changes to customer contracts:
-More than 200 contracts
-13 contract types
RISKS MAP / CONTINUITY
Risks identification and monitoring.
Improvements in mitigation and control plans
Continuity and Cyber Risks management practices
Organizational readiness
Change strategies
Execution of organizational structure changes
Communication Plan
Internal training execution

6. Market Transformation Implications
Changes to current integration architecture
Transform and optimize value chain market processes
Considerations:
Must cover all current processes
Enable market processes transformation to adopt new global standards
Communication
Understand what hurts the market and find solutions
Leverage on market leaders
Use of multipliers – associations
Market Models for stragglers
Solution – Strategies
Transformation Program – multiple projects
Stakeholder Communication
Market Change Management
Acceptance evaluation
Training
Testing
Continuous monitoring
Benefits and Direct Effects:
Better customer experience - times, availability, opportunity, information, others
Improve Interoperability : STP
Improved CSD’s Thomas Murray risk rating with positive effect in the Colombian Market risk profile
Improvement on asset liquidity and commitment risk in the Colombian Securities Market
Efficiency in book entry transfers
Better clearing and settlement efficiency
Critical Success Factors:
Financial Supervisor support and stakeholder monitoring
Stakeholders Readiness and change management
Training and communication strategy

7. TCS BANCS Implementation

8. Stakeholder Map Depository Financial Infrastructures (FMI´s)
Direct depositors
(231)
Financial, Industry and Commerce supervisors (3)
Custodians (3)
Local: Central Bank (DCV – CUD), Stock Exchange, Clearing House, OTC systems
Other FMIs: International custodians and CSD’s (Citi, Deutsche Bank y Clearstream), MILA (DCV Chile, Cavali Peru, Indeval Mexico)
Brokers, Pension Funds, Trust Companies, Investment Funds Administrators, Banks, Financial Corporation, Commercial Financing Companies, Severance Pay Funds
Financial Supervisor - Superintendencia Financiera de Colombia ,
Capital Market Supervisor - AMV,
Industry and Commerce supervisor - Superintendencia de Industria y Comercio
Special process
Cititrust, BNP PARIBAS,
ITAU Securities Services
ANNA Service Bureau
IT Providers – Al Cuadrado, Heihnson, Cromasoft, Intellego y Alfa GL
Quote Providers – Precia, PIP -
Issuers (257) / Administrators (214)
Depository
Issuers: Financial sector – include investment funds, Consumer Sector, Public sector,
Issue Administrators, Employee funds, Financial associations, Special Issue: DIAN – Tax return, Treasury department – Retirement bonds office,
Integral Equity management

9. Capital Market transformation program
Strategy Highlights
Initiatives by Segment/Impacted
Functional, Technical, Human
With Associations
Communications plan
Goals
Channels
Audiences
Messages y frequency
RACI
Estate
Training plan
Segments
Training programs
Users by role-time
Entities by industry sector
Geographical area
Testing plan
Strategy
Scenarios
Action Plan
Scripts o Logbooks
Adjustment schema
Transformation Master Plan
Foundations and Premises
Accompaniment, Monitoring and Control Plan
Initiatives by Segment/Impacted
Communications plan
Training plan
Testing plan
Adoption, transformation, innovation
Do not impair products or services
Achieve commitment: Communicate, Train and Test
Accompany and Control
Supporting in Facilitators
Associations
Industry committee
IT providers
Users committee
Impact Segmentation
Financial infrastructures (local – internationals)
Issuers and Administrators
Direct depositants
Financial Supervisors
Internacional custodians
Special process
VIP´s management
Value approach
Tangible and Perceived Benefits

10. Solution Analysis Complete
Project Plan
ACTIVITIES
Mar-18
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Nov-19
Dec-19
Jan-20
Feb-20
Mar-20 M1 M2 M3 M4 M5 M6 M7 M8 M9
M10
M11
M12
M13
M14
M15
M16
M17
M18
M19
M20
M21
M22
M23
M24
M25
TCS Contract Negotiation
Base Software Delivery
Product Familiarization
Solution Analysis
Data Migration Scope Finalization
Solution Alignment (Offshore)
Software Verification (Offshore)
Software Configuration and Installation
System Integration Test
Data Migration
Data Migration Test
Processes and Organization
Internal Change Management
Users Training
User Acceptance Tests (UAT)
Market Transformation
Market Acceptance Test (MAT)
Go Live
Standard Warranty Support
Extended Warranty
Colciencias Requirements
Solution Analysis Complete
Software Delivery
UAT GO
Activities in Blue are Deceval’s Responsibility

11. Risks