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REQUEST FOR PROPOSAL (RFP)
FOR
SOLUTION TO IMPLEMENT ENTERPRISE-WIDE INTEGRATED RISK MANAGEMENT
ARCHITECTURE UNDER BASEL II & BASEL III
(FOR THE BANK AND ITS GROUP ENTITIES)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 2 of 250
Definitions of major terms/ abbreviations used on the document
Sl. No. Acronym/ Term Used Definition
1 AFS Available for Sale
2 AIC Akaike Information Criterion
3 AIRB Advanced Internal Ratings Based
4 ALCO Asset Liability Management Committee
5 ALM Asset and Liability Management
6 AMA Advanced Measurement Approach
7 AMFI Association of Mutual Funds in India
8 AMS Annual Maintenance Service
9 ASCII American Standard Code for Information Interchange
10 ATS Annual Technical Support
11 Bank Canara Bank
12 Basel II Guidelines
Framework for Capital Measurement and Capital Standards issued
by Basel Committee on Banking Supervision
13
14
15
16
Basel II RBI Guidelines
• Master Circular - Prudential Guidelines on Capital Adequacy and
Market Discipline- New Capital Adequacy Framework (NCAF)
• Implementation of the Advanced Measurement Approach
(AMA) for Calculation of Capital Charge for Operational Risk -
Guidelines
• Capital Adequacy - The Internal Ratings Based (IRB) Approach to
Calculate Capital Requirement for Credit Risk
• Prudential Guidelines on Capital Adequacy - Implementation of
Internal Models Approach for Market Risk
17
Basel III Guidelines
A global regulatory framework for more resilient banks and banking
systems and International framework for liquidity risk
measurement, standard and monitoring
18
19
Basel III RBI Guidelines
• Guidelines on Implementation of Basel III Capital Regulations in
India
• Guidelines on Liquidity Risk Management and Basel III Framework
on Liquidity Standards
• Capital Requirements for Bank’s Exposures to Central
Counterparties
20 BEEL Best Estimate Expected Loss
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 3 of 250
21 BEICF Business Environment and Internal Control Factors
22 BIC Bayesian information criterion
23 BIS Bank for International Settlements
24 BLM Business Line Mapping
25 BRS Business Requirement Specifications
26 CBS Core Banking Solutions
27 CDSL Central Depository Services Limited
28 CO Commercial Offer/ Commercial Bid/ Price Bid
29 CORDEx Credit & Operational Risk Loss Data Exchange
30 CRMD Credit Risk Management Department
31 CRMS Credit Risk Management System
32 CSV Comma-Separated Value
33 CVA Credit Valuation adjustment
34 DGA Duration Gap Analysis
35 DIT Department of Information Technology
36 EAD Exposure at Default
37 ECGC Export Credit Guarantee Corporation
38 ECS Electronic Clearing Service
39 EDA Exploratory Data Analysis
40 EDW Enterprise Data Warehouse
41 EEPE Effective Expected Positive Exposure
42 EFT/ SEFT Electronic Funds Transfer/ Special Electronics Fund Transfer
43 EMD Earnest Money Deposit
44 EOD End of Day
45 EPE Expected Positive Exposure
46 ETL Extract, Transform, Load
47 EVT Extreme Value Theory
48 EWIRM Enterprise Wide Integrated Risk Management
49 FEDAI Foreign Exchange Dealers’ Association of India
50 FIFO First In First Out
51 FIMMDA Fixed Income Money Market and Derivatives Association of India
52 FIRB Foundation Internal Ratings Based
53 Flexcube Core Banking Application software used in bank
54 FM&S Financial Management and Subsidiaries
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 4 of 250
55 FX Foreign Exchange
56 GUI Graphical User Interface
57 HFT Held for Trade
58 HTM Held to Maturity
59 IMA Internal Model Approach
60 IMF International Monetary Fund
61 IPR Intellectual Property Right
62 IRB Internal Ratings Based
63 IRC Incremental Risk Charge
64 IRMD Integrated Risk Management Department
65 IT Information Technology
66 KRI Key Risk Indicators
67 LGD Loss Given Default
68 LIFO Last In First Out
69 M Effective Maturity
70 MBS Mortgage backed Securities
71 MDB Multilateral Development Bank
72 MIS Management Information System
73 MLE Maximum-Likelihood Estimation
74 MPE Maximum Peak Exposure
75 MRMS Market Risk Management System
76 MTM Marked to Market
77 MVA/E Market Value of Asset/ Equity
78 MVS Market Value Sensitivity
79 NAS Network Attached Storage
80 NCAF New Capital Adequacy Framework
81 NEFT National Electronic Funds Transfer
82 NPA Non-Performing Asset
83 NPV Net Present value
84 NSDL National Securities Depository Limited
85 OBD Overseas Banking Division
86 OEM Original Equipment Manufacturer/ Product Vendor
87 ORC Operational Risk Category
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 5 of 250
88 ORCC Operational Risk Capital Charge
89 ORM Operational Risk Management
90 ORMD Operational Risk Management Department
91 ORMF Operational Risk Management Framework
92 ORMS Operational Risk Management System
93 OSD Original Software Developer
94 PD Probability of Default
95 PFE Potential Future Exposure
96 QRRE Qualified Revolving Retail Exposures
97 RAPM Risk Adjusted Performance Measurement
98 RAROC Risk Adjusted Return on Capital
99 RBI Reserve Bank of India
100 RCA Root Cause Analysis
101 RCSA Risk and Controls Self-Assessment
102 RFP Request for Proposal
103 RTGS Real Time Gross Settlement
104 RWA Risk Weighted Assets
105 SI System Integrator/ Bidder
106 SL Specialized Lending
107 SLA Service Level Agreement
108 SLS Structural Liquidity Statement
109 SVaR Stressed Value at Risk
110 SWIFT Society for Worldwide Interbank Financial Telecommunication
111 TGA Traditional Gap Analysis
112 TO Technical Offer
113 UAT User Acceptance Test
114 VaR Value at risk
115 XML Extensible Mark-up Language
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 6 of 250
TABLE OF CONTENTS
1 INTRODUCTION 10
1.1 OVERVIEW 10
1.2 BROAD SCOPE OF WORK 11
1.3 INVITATION FOR BIDS 23
2 INSTRUCTIONS FOR BID SUBMISSION 25
2.1 GENERAL INSTRUCTIONS 25
2.2 DOCUMENTS COMPRISING THE BID 29
2.3 KEY GUIDELINES FOR PREPARING RFP RESPONSE 34
3 ADDITIONAL INSTRUCTIONS FOR BIDDERS 34
3.1 GENERAL INSTRUCTIONS 34
3.2 PAYMENT TERMS 45
3.3 WARRANTY & ANNUAL MAINTENANCE 47
3.4 TERMINATION 50
4 EVALUATION METHODOLOGY 55
4.1 NORMALIZATION OF BIDS 56
4.2 OPENING OF BIDS BY THE BANK 56
4.3 ELIGIBILITY CRITERIA 58
4.4 EVALUATION CRITERIA 63
4.5 FUNCTIONAL AND TECHNICAL EVALUATION CRITERIA 67
4.6 SHORTLISTING OF TECHNICALLY QUALIFIED BIDDER 75
4.7 COMMERCIAL EVLUATION PROCESS 77
4.8 TECHNO-COMMERCIAL EVALUATION PROCESS 77
4.9 DISQUALIFICATION PARAMTERS IN TECHNICAL BID EVALUATION 78
5 OTHER TERMS & CONDITIONS 79
6 FUNCTIONAL REQUIREMENTS FOR CREDIT RISK 84
6.1 FUNCTIONAL REQUIREMENTS 84
6.2 HARDWARE REQUIREMENTS 115
6.3 TRAINING REQUIREMENTS 115
6.4 PROJECT MANAGEMENT METHODOLOGY 116
7 FUNCTIONAL REQUIREMENTS FOR OPERATIONAL RISK 118
7.1 FUNCTIONAL REQUIREMENTS 118
7.2 HARDWARE REQUIREMENTS 137
7.3 TRAINING REQUIREMENTS 137
7.4 PROJECT MANAGEMENT METHODOLOGY 138
8 FUNCTIONAL REQUIREMENTS FOR MARKET RISK 139
8.1 FUNCTIONAL REQUIREMENTS FOR MARKET RISK UNDER IMA 139
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 7 of 250
8.2 FUNCTIONAL REQUIREMENTS FOR ALM SYSTEM 166
8.3 HARDWARE REQUIREMENTS 183
8.4 TRAINING REQUIREMENTS 183
8.5 PROJECT MANAGEMENT METHODOLOGY 184
8.6 ADDITIONAL INFORMATION FOR MARKET RISK 186
9 INTEGRATED CAPITAL COMPUTATION & REPORTING MODULE 188
9.1 FUNCTIONAL REQUIREMENTS 188
9.2 HARDWARE REQUIREMENTS 189
9.3 TRAINING REQUIREMENTS 189
9.4 PROJECT MANAGEMENT METHODOLOGY 191
10 TECHNICAL SPECIFICATIONSACROSS ALL SYSTEMS/ RISK SOLUTIONS 192
11 ANNEXURE 201
11.1 UNDERTAKING FROM BIDDER 201
11.2 ELIGIBILITY CRITERIA FORMAT 202
11.3 COVER LETTER FOR TECHNICAL BID 203
11.4 TECHNICAL BID FORMAT 205
11.5 COVER LETTER FOR COMMERCIAL BID 213
11.6 COMMERCIAL BID (BILL OF MATERIAL) FORMAT 215
11.7 BID OFFER COVERING LETTER 224
11.8 REFERENCE SITE DETAILS 226
11.9 PARTICULARS OF BIDDER 227
11.1 PAST EXPERIENCE DETAILS 231
11.11 PERFORMANCE GUARANTEE FORMAT 233
11.12 MANUFACTURERS’ / PRODUCERS’/ AUTHORIZATION FORM 237
11.13 IMPLEMENTATION TEAM PROFILE 239
11.14 IMPORTANT PROJECT TIMELINES 242
11.15 LIST OF EXISTING APPLICATIONS 243
11.16 DATA CENTER AND DISASTER RECOVERY SITE OF GROUP ENTITIES 250
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 8 of 250
SCHEDULE OF ACTIVITIES AND EVENTS
RFP Reference RMW/01/2013-14
Date of issue of the RFP 10.07.2013
Last date and time for submission of
Queries by the Bidder
17.07.2013 - 3.00 PM
Date and time for Pre-Bid Meeting 25.07. 2013 - 3.00 PM
Date for publishing clarifications on
website
29.07.2013
Last date & time for submission of Bids:
Eligibility Criteria, Technical and
Commercial Proposals.
14.08.2013 - 3.00 PM
Place for submission of bids GM Secretariat
Risk Management Wing
2nd
Floor
Canara Bank Head Office
112 – J.C Road
Bangalore – 560002
Date and Time of Opening of Eligibility
Criteria and Technical Proposals
14.08.2013 - 4.00 PM
Bid document price (nonrefundable) Rs 1,00,000
Earnest Money Deposit Rs 50,00,000
Address for Communication GM Secretariat
Risk Management Wing
2nd
Floor
Canara Bank Head Office
112 – J.C Road
Bangalore – 560002
Email – [email protected]
Date for Technical Presentation Will be informed after 21.08.2013
Date and Time of Opening of Commercial
Proposals
Will be notified to the shortlisted
bidders.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 9 of 250
Note:
a. Bids will be opened in the presence of bidders’ representatives who choose to attend on the
bid opening date.
b. The schedule is subject to change and notice of changes shall be published on the website of
the Bank. The Bank reserves the right to cancel the RFP at any time without incurring any
obligation to any bidder.
c. Any queries regarding RFP may be sent to Canara Bank GM’s Secretariat, Risk Management
Wing, 2nd
Floor, Head Office, 112 J.C Road, Bangalore - 560002 or via email to
d. The bidders may note that no further notice will be given in this regard. Further, in case the
Bank does not function on the aforesaid date due to unforeseen circumstances or holiday
then the bid will be accepted up to 03:00 PM on the next working day and bids will be
opened at 04:00 PM at the same venue on that day.
e. The RFP document can be downloaded from Bank’s website
http://www.canarabank.com/English/Scripts/Tenders.aspx.
f. Any bid without payment of bid document price and EMD will be rejected.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 10 of 250
1. Introduction
1.1 Overview
Risk Management especially in the post financial crisis has become a significant function in
banks across the world. In the context of ongoing changes in financial landscape banks are
required to be ever more nimble and at the same time ensure that all the risks are managed
and/or mitigated effectively.
Canara Bank (herein after referred to as the ‘Bank’) views the current market dynamics and
resulting regulatory requirements as an opportunity to create an Integrated Risk Management
Framework that will create shareholder value by aligning the Bank’s business strategy to its risk
management policies, processes and systems. Over a period of time, Canara Bank has taken
various initiatives for strengthening risk management practices. Bank has an integrated
approach for management of risk and in tune with this, formulated policy documents taking into
account the Business requirements / best international practices and the supervisory guidelines.
These policies address different risk classes viz., Credit Risk, Operational Risk and Market Risk.
Over the years, Bank has earned the reputation of being technology savvy and one of the
Frontrunners among public sector banks in modern‐day banking trends. Having implemented its
Core Banking Solution in 2010, Bank is one of the first Public Sector Banks in the country to have
all domestic branches on a single Core Banking platform. Under this solution umbrella, all
branches and ATMs of BANK have been networked, with online Tele banking, net banking and
mobile banking facility made available to both its Core Banking Customers – individual as well as
Corporate. Regular banking services apart, the customer can also avail of a variety of other
value‐added services like Cash Management Service, Insurance, Mutual Funds and Demat.
Bank has a strong network of over 3600 domestic branches, 34 Circle Offices and 5 overseas
Branches, which are.
1. Canara Bank, London Branch
2. Canara Bank, Hong Kong Branch
3. Canara Bank, Leicester Branch
4. Canara Bank, Shanghai branch
5. Canara Bank, Manama, Bahrain
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 11 of 250
Bank is having plans to open more domestic and overseas branches in other jurisdictions.
The Bank has the following subsidiaries and group entities:
i. Canbank Venture Capital Fund Limited (CVCFL)
ii. Canbank Financial Services Limited (CANFINA)
iii. Canara Bank Securities Limited
iv. Canbank Factors Limited
v. Canbank Computer Services Limited (CCSL)
vi. Canara Robeco Asset Management Company Limited
vii. Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited
viii. Can Fin Homes Limited
ix. Commercial Bank of India LLC, Moscow
x. Pragathi Gramin Bank (Regional Rural Bank)
xi. Kerala Gramin Bank (Regional Rural Bank)
1.2 Broad Scope of Work
The scope of project envisages a complete turnkey solution which includes design, sizing,
procurement, installation, customization, configuration, maintenance of the hardware, software
and other components required for an Enterprise Wide Integrated Risk Management (EWIRM)
Solution. This would also envisage parameterization, historical data management, verifying data
quality, migrating data, user acceptance testing, documentation, trainings, knowledge transfer
and support. The solution/s offered should be web based, open platform and support data
transfer and consolidation from both the networked and standalone systems either online or
dial up. The EWIRM Solution shall be implemented at the Bank and its group entities except
Canara HSBC Oriental Bank of Commerce Life Insurance Company Limited and Commercial Bank
of India LLC, Moscow.
Credit Risk Management is an important part of bank’s operations. This would help the bank in
keeping a check on the asset quality at appraisal level as well as on an ongoing basis. For moving
to advanced Approaches for credit risk, Banks have to classify exposures into specified
categories viz. Corporate, Sovereign, Bank, Retail, Equity and Others estimate various Risk
components viz. Probability of Default (PD), Loss Given Default (LGD), Exposure At Default (EAD)
and Effective Maturity (M) and comply with minimum standards as per the Basel II Internal
Ratings Based (IRB) Approach guidelines.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 12 of 250
Bank has currently adopted Standardised Approach for Credit Risk under Basel II. Bank has put in
place four Credit risk rating models namely, RAM model, Manual model, Small Value model &
Portfolio model for assignment of Internal Ratings to the borrowers. In this regard, the Bank has
collated the required data for RAM Model validation since 2004 to 2012.Bank now intends to
adopt Advanced Internal Rating Based Approach (AIRB) for calculating capital charge for Credit
Risk.
Operational Risk, which is intrinsic to the bank in all its material products, activities, processes
and systems, is emerging as an important component of the enterprise‐wide risk management
system. Recognizing the importance of Operational Risk Management (ORM), the Bank has
adopted a Comprehensive Operational Risk Management Policy. This would entail the bank to
move towards enhanced level of sophistication in the years ahead and to capture qualitative
and quantitative aspects of operational risks in measurement and management of operational
risk.
Bank is presently under the Basic Indicator approach for Operational Risk Regulatory Capital
Calculation. Further the Bank has taken initiatives to progress towards adopting advanced
approaches. To achieve this objective, the Bank has planned to implement an Operational Risk
Management Solution (ORMS). Bank is also gearing up its risk management process for
migrating to advanced approach under Basel II operational risk estimation ‐ Advanced
Measurement Approach (AMA).
Market Risk Management is also an important part of overall risk management in Bank and it
covers both domestic and forex treasury operations. Bank is presently under Standardized
Modified Duration Approach for calculation of capital charge for Market Risk. Bank intends to
move to Advanced Approach under Basel II by adopting Internal Models Approach.
The Bank has a comprehensive system of internal controls, systems and procedures to monitor
and mitigate risk. The Bank has also institutionalized new product approval process to identify
the risks inherent in the new product and activities. The Bank has carried out a comprehensive
Self‐Assessment exercise spanning all the risk areas and evolved a road map to move towards
implementation of Basel II norms as per RBI’s guidelines. The program of Risk Management,
Organizational Structure, Risk measures, risk data compilation and reporting is getting
implemented for a period of time in the Bank with the strategic aim of migration to advanced
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 13 of 250
approaches which would help achieve long term benefits. The Bank has appointed a consultant
for assistance in the Bank’s initiative to migrate to advanced risk management approaches and
for the implementation of an Enterprise Wide Integrated Risk Management Architecture.
Bank recognizes the need for an enterprise wide risk management architecture where in
advanced risk management approaches are implemented within its subsidiaries and group
entities. All the subsidiaries and group entities of the Bank has a risk management function
including risk management policies and is guided by the Group Risk Management policy of the
Bank. The implementation of the enterprise wide integrated risk management architecture at
the Bank envisages roll out of advanced risk management approaches to all the subsidiaries and
group entities of the Bank.
The Bank has already taken steps in this direction and this Request For Proposal (RFP) is
intended to invite Techno‐Commercial bids from eligible Bidders to provide end‐to‐end
solutions for implementation of Credit Risk Management System (CRMS), Operational Risk
Management System (ORMS), Market Risk Management System (MRMS) and an Integrated
Capital Computation and Reporting Module for the advanced approaches under RBI Guidelines
on Basel II and Basel III to have an integrated risk management frame work, herein after
referred to as EWIRM Solution. The requirements under CRMS has been split into two sections
one for a CRMS in compliance with IRB requirements and second a Loan Origination System
(LOS). Similarly the requirements for MRMS have been defined for MRMS under IMA
Compliance and Asset Liability Management System (ALMS) including Fund Transfer Pricing
(FTP).
Within this RFP the terms bidder and system integrator (SI) have been used interchangeably.
Responsibilities of Bidder
Successful bidder based on this RFP terms and conditions should
(i) Implement the solution at all branches including overseas branches, and its subsidiaries
and group entities as decided by the Bank and should support multilingual requirements.
The system should:
a. Support estimation of all risk components and capital calculations (regulatory &
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 14 of 250
economic) as per the guidelines issued by RBI and Basel under the Standardized and
IRB approaches. The solution should be able to meet the Pillar I, II, III and stress
testing requirements as per RBI and Basel guidelines on Basel II and Basel III. The
solution should be capable of supporting all the required statistical, analytical, risk
modeling, pricing and reporting requirements as per regulatory and Bank’s internal
requirements.
b. Support operational risk measurement and modeling as per RBI and Basel II
requirements under AMA. ORMS should be available to the bank at Enterprise-wide
Level.
c. Be able to perform back testing, stress testing, calculate specific risk VaR and
Incremental risk VaR requirements as per Basel II, Basel III and RBI guidelines.
d. strengthen bank’s ALM system processes by complying with all ALM DGA
requirements by RBI.
e. Support home host country requirements for overseas operations and also
requirements of the subsidiaries and group entities of the Bank.
(ii) Provide data repository such as but not limited to list of KRI’s, Risk and Control, UAT
scenarios, Scenarios for scenario analysis with their due mapping, reporting templates
(iii) Set up, installation and testing of the required hardware and software within the Bank
including its data centers at Bangalore and Disaster Recovery Site in Mumbai. Ensure in
coordination with the Bank that the solution is accessible from all across the Bank
including overseas branches, its subsidiaries and group entities. Details of data center
and disaster recovery site of the subsidiaries and group entities are furnished in
Annexure no. 11.16.
(iv) Offer Facilities Management support for EWIRM solution and associated IT Infrastructure
proposed by the bidder for the entire project duration.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 15 of 250
(v) Impart training on EWIRM solution to designated personnel of the Bank and its
subsidiaries and group entities including users, technical personnel handling the system
and trainers.
(vi) Provide Hand-over of the solution at the end of the agreed period post UAT signoff.
(vii) Ensure system is in compliance with RBI requirements for all Basel II advanced
approaches and Basel III and other relevant regulatory guidelines. Any instances of non-
compliance observed will need to be rectified at no additional cost and well within
timelines stipulated by the regulator
(viii) Incorporate changes in system arising on impact of amendment to regulations/bank’s
policy at no additional cost and well within timelines stipulated by the regulator
(ix) Assist the bank in conducting the User Acceptance tests
(x) Provide complete documentation including logic used, empirical analysis done,
methodology etc. as per regulatory and audit requirements
(xi) Provide all statutory, regulatory Management Information System (MIS), adhoc MIS
(including development if needed) and Executive Information System (EIS) reports as
required by the Bank and its subsidiaries and group entities in the desired format as per
regulatory and Bank’s requirements
(xii) Meet all requirements specified in this RFP
The Bidder should implement the EWIRM Solution compliant with Basel II advanced approaches
and Basel III at the Central Processing Center (CPC), Head Office, all the Circle Offices, domestic
branches, overseas branches, subsidiaries and group entities and demonstrate their capability as
per agreed number of site demonstrations at group entities. The solution will be implemented in
branches/Administrative offices/subsidiaries/group entities as decided by the Bank.
In case the product/ solution/ vendor/ OEM is taken over/ amalgamated/ dissolved the impact
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 16 of 250
of such an event should not have any adverse implication on the service level/ time line/cost
that have been proposed for implementation of the solution.
1.2.1 Solution Design, size and procurement
(i) Selected bidder is required to design, size, procure and implement the EWIRM Solution
with the functionalities identified in the Functional Requirements and Technical Solution
Requirements for Credit Risk Management, Operational Risk Management, Market Risk
Management and Integrated Capital Computation and Reporting as detailed across this
RFP.
(ii) Automated Interfaces required of the solution with other internal system solution and
outside system solution has to be provided by the selected bidder to ensure satisfaction
of the functional and technical requirements. Bidder will be responsible for the
procurement of any tool required to develop the interface. Bidder will document the
entire interface logic and process with change management procedures in compliance
with Bank’s policies and procedures.
(iii) The selected bidder is expected to leverage the bank’s existing datacenter services, EDW
infrastructure (as and when operational), SAN storage, backup tape libraries, archival,
legacy data etc. With the endeavor to reduce the overall cost of procurement to the
Bank, the bidder shall also continuously explore avenues to reduce the cost and act in
the best interest of the Bank.
1.2.2 Gap identification & Resolution
The selected bidder will be responsible for conducting the gap assessment of the EWIRM solution
with bank’s framework, policy, procedures, governance, methodology, approach, existing
system, tools, models, reports, Basel II, Basel III and other regulatory guidelines issued by RBI etc.
pertaining to Credit Risk Management, Operational Risk Management, Market Risk Management
and Integrated Capital Computation and Reporting, in order to implement EWIRM solution as per
this RFP requirements and to:
1. Provide the Bank with the gap identification report along with the recommendations and
estimated time frames to implement the same
2. Determine the customization requirements, in case a particular functionality / requirement is
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 17 of 250
not supported by the existing version of the EWRIM solution;
3. Resolve gaps by customizing the proposed solution by way of modifications / enhancements,
as necessary
1.2.3 Parameterization, Configuration and Customization of software
1. The Bidder shall be responsible for accuracy of the parameters set in the system according
to business needs of the Bank.
2. The cost of all customizations is required to be included in the Commercial Bid and the Bank
will not make any additional costs for this throughout the term of the contract if the same
has been specified as a requirement of Canara Bank in this RFP. Thus, this is a fixed bid and
all necessary customizations based on the functional requirements specified in the RFP will
need to be conducted by the Bidder.
3. Bidder needs to give detailed plan for customization. All customization has to be completed
within the project timelines.
4. The Bidder should ensure that the quality assurance and development standards outlined in
the development methodology are adhered to and required functionalities/reports related
to same are generated and shared with the Bank team on a regular basis
5. Enhancements provided by the Bidder would include changes in the software due to
Statutory and Regulatory changes and those required due to changes in industry practices in
India and/or abroad or any other requirements of the Bank related to the above, which will
need to be provided at no extra cost to the Bank for the entire period of the contract. It will
include, but not limited to, all the functionalities mentioned in the Functional Requirements
and at no additional costs.
1.2.4 Testing
1. The Bidder will be responsible for conducting system integration testing to verify that all
system elements have been properly integrated and that the system performs all its
functions.
2. Bidder will conduct a “User Acceptance Test” (“UAT”) under guidance, review and
supervision of the bank to ensure that all the functionality required by the Bank is available
and is functioning accurately as per the expectations of the Bank.
3. Bidder will be responsible for setting and maintaining the test environment during the entire
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 18 of 250
period of project implementation and will ensure its configuration and parameterization for
conducting the UAT as per bank's risk management framework and in compliance with this
RFP’s requirements. The bidder shall ensure that the test environment has the same
configuration and functionalities as that of the production environment.
4. The Bidder will provide the scenarios for UAT and assist in preparing test cases including the
test data to support all the Business scenarios. The Bidder should dedicate resources (from
Bidder as well as OEM team) to work with the Bank’s project team for this purpose.
5. The Bidder will assist the Bank in analyzing / comparing the results of testing.
6. Bidder shall provide adequate resources for trouble-shooting during the entire UAT process
of the Bank.
7. The Bidder will be responsible for maintaining appropriate program change control and
version control of the system as well as documentation of UAT and change of configuration
and parameterization after making changes in the system.
8. All errors, bugs enhancements/ modifications required during and after testing will be
resolved within the overall timelines for implementation. Sign – off for the same will be
obtained from the Bank prior to implementing the work around, in respect of errors and
bugs affecting the functioning of the Bank.
9. The Bidder will be responsible for using appropriate tools for logging, managing, resolving
and tracking issues and its progress, arising out of testing and ensuring that all issues are
addressed in a timely manner to the satisfaction of the Bank and as per requirements
mentioned in this RFP.
1.2.5 Training
The Bidder shall be responsible for training the employees of the Bank including overseas
branches and its subsidiaries and group entities in the areas of system administration,
implementation, use / operations, management, database management, error handling /
troubleshooting, etc. of the EWIRM Solution.
Structure of the training program covering number of trainings, locations and number of
participants etc. is to be advised by the bidder.
Bidder will also be responsible to develop training and reference materials for all the
functionality of the software. Training / reference materials should be designed separately for
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 19 of 250
operational staff / user, IT department and senior management. Training material should
comprehensively cover all the functionality of the proposed EWIRM solution and be written in a
user friendly manner with use of graphs, processes flows, screen-shots of the actual system
functionality etc.
Bidder should provide Bank specific training material designed considering its requirements in
this RFP. Training material so provided will be subject to review and sing-off by the bank as a
project deliverable.
The training should at least cover the following areas:
• Functionality available in the solution including logic and methodology of the same;
• Customization / Parameterization;
• Techniques for Slicing and dicing of data, information, and output
• Auditing techniques including generation of audit trail reports;
• Advanced trouble shooting techniques;
• Techniques for generation, view and reporting of intermittent results;
• Deployment of various processes, risk reporting and identification procedures,
application of controls, analysis procedures provided as part of the solution;
• Techniques of Customization, development and configuration of required reports
including ad-hoc reports from the solution provided;
• Development and deployment of new functionalities using the proposed solution;
• System & Application Administration such as creation of user, user groups, assigning
rights, System Information Security Settings etc.
• Perform Impact Analysis using the solution;
• Business use of the solution
As per the requirements defined in this RFP, bank may increase more areas of trainings which
bidder would be liable to provide.
1.2.6 Implementation
The proposed solution should cover all the existing branches/units/administrative offices as
decided by the Bank and have the capability to scale up for meeting future requirements.
The solution should be scalable and capable to handle increased volumes. In the event the bank
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 20 of 250
adds/changes/updates source/core banking systems in the future the solution should be flexible
to handle such new source systems.
The Bidder will have to provide the necessary interface to all the applications as required. The
list of Bank’s existing applications in the Bank and its Group Entities is detailed later in Annexure
11.15.
At present, the Bank’s Core Banking Solution is in Oracle Database. The database for EWIRM
Solution should be compatible to CBS (Oracle). The successful bidder shall be responsible for
taking up with the system integrator of CBS for the required data. Ultimately, the EWIRM Risk
Solutions shall be linked to Enterprise Data Warehouse (as and when operational). The
successful bidder shall coordinate with EDW integrators for the requirements. The proposed
solution should be compatible both the platforms i.e. Intel & AIX.
By means of diagrammatic / pictorial representations, the Bidder should provide complete
details of the hardware, software and network architecture of the EWIRM Solution (module and
sub‐module wise), including source / method of Data capture and transfer, validation, updation
and database maintenance for networked and non‐networked branches.
The Bidder should assist for implementation in 100 branches/units /administrative offices and
subsidiaries and group entities spread across the country (along with all the Circle Offices) on
pilot basis. The Bidder should install and commission the solution and integrate with the Bank’s
applications at domestic branches, overseas branches, subsidiaries and group entities. The
branches for pilot implementation would be decided by the Bank.
The system should be implemented in all the remaining units after its satisfactory working in
100 branches/units/administrative offices and implementation in all the units should be
completed within 12 months from the date of signing of contract.
Details of functional and technical requirements are provided in Section 6, Section7, Section 8,
Section 9 & Section 10: Functional Requirements & Technical Requirements of this document.
The Bidder should provide hardware systems, operating system, database, for EWIRM solution
including CRMS application software, ORMS application software, MRMS application software,
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 21 of 250
Integrated Capital Computation and Reporting module application software and other necessary
software & hardware required for the successful implementation of the proposed solution
including DR site of equal capacity as live including data replication requirements (at the end
of day) along with data replication solution and a required Test server (Application &
Database Server).Firewall & Network Security will be provided by the Bank. The Bidder has to
ensure that vulnerabilities at application level in case of any breach shall be handled by the
offered application software.
The Bidder has to upgrade servers/ storage at no extra cost to the Bank, in case the offered
configuration does not meet the requirements, for 7 years from the implementation start date.
The total storage provided/ proposed by the bidder shall take into account incremental growth
of the Bank over the next 7 years and should be in RAID 5 or RAID 1+0. The Bidder may propose
a Network Attached Storage (NAS) / Storage Area Network (SAN) to meet the requirements as
found suitable. The proposed hardware at the data center must be in active‐passive cluster with
external SAN storage with back up tape library and support RAID 0 to 5 with no single point of
failure.
A complete Bill of Material for the hardware required for the successful operation of the
solution should also be provided by the Bidder, with full particulars like make, model, part
numbers, proposed configuration, including all details like memory type proposed with future
expandability, processor type, number of processors, processor speed, future expandability, bus
speed, etc. and clearly show no single point of failure. Please refer Annexure 11.4 Technical Bid
Format (sub sections on hardware requirements) and Annexure 11.6: Commercial Bid (Bill of
Material) Format.
The Bidder should specify the hardware requirement taking into consideration the efficiency
level, response time, data processing requirement, number of users, and all other parameters to
ensure that the efficiency of software system is not affected because of hardware. Bidder should
provide details for DR site such as network and security requirements, switches, routers etc. The
Bidder will certify that the hardware specified is adequate for meeting performance standards
set by the Bank, and it takes full responsibility of upgrading hardware without any extra cost to
the Bank, if at the time of implementation or any time subsequently it is found that the
hardware specified requires upgrade. At any point in time during the contract period, the CPU
utilization should neither exceed 60% nor should the Hard Disk utilization exceed 60% at the
Primary Data Centre. In case the hard disk utilization exceeds 60%, the additional hardware has
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 22 of 250
to be provided by the Bidder at no further cost.
The Bidder must ensure no hardware equipment or software, for which ‘End‐‐‐‐of‐‐‐‐Sale’ has been
declared, is offered as part of this bid. None of the hardware or software should have an ‘End‐‐‐‐
of‐‐‐‐Support’ mandated by the respective OEM within seven years from date of completion of
the project and the bidder should ensure continuity at all times without disruption of
operations.
The Bidder should also provide the Bank with the number of racks required for the servers /
equipment and associated infrastructure, as well as power requirements (average, peak and
rated power) and any other specific requirements for the servers / equipment (Network and
security requirements, switches, routers etc.) and associated infrastructure for both DC (Data
Centre) & DR (Disaster Recovery) sites.
Sizing of equipment, hardware etc. as required, depending on the functionalities required by the
bank as mentioned in the RFP, should be provided by the Bidder for processing of existing
portfolio of the Bank/Group with increase in volumes at approximately 20% p.a. and addition of
new products/instruments and data maintenance for a minimum period of 7 years as per RBI
guidelines.
The Bidder has to give an undertaking to implement the solution at any location / branch
identified by Bank at no extra cost.
As part of implementation all data migration (as and when required) from the existing systems
to the system proposed will be done by the Bidder. The Bidder shall demonstrate to the
satisfaction of the Bank regarding accuracy and comprehensiveness of the data migrated to the
proposed system.
During the period of contract, if any of the subsidiaries or group entities of Canara Bank get
merged, the data of the merged entity needs to be migrated and integrated to the central
database which needs to be provided at no extra cost. Similarly if any of the subsidiary and
group entity goes out of Canara Bank, the data relating to such entity needs to be extracted and
stored separately at no additional cost. During the period of contract if any entity gets merged,
the bidder shall facilitate such mergers of databases and if necessary provide suitable solution
on mutually agreed terms.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 23 of 250
1.2.7 Facilities Management Services (FMS) and Helpdesk
The Bidder is required to provide Helpdesk services till the completion of the implementation
across Bank and its group entities. Facility Management services will be provided by the bidder
till the end of the project. The bidder is required to indicate the resource requirements for FMS
in the Bill of Material.
Facilities Management: Facilities Management would include support for all hardware,
application software, etc. which would be provided by the Bidder. Bidder should elaborate on
FMS like number of resources to be deployed post implementation and detail it accordingly in
Bill of Material. FMS services should be provided for entire project duration (1 year
implementation and 6 years maintenance)
Helpdesk: Helpdesk refers to availability of resources to record and respond to events and
incidents related to the application, hardware & software implemented as per the scope of this
RFP. Helpdesk services should be provided till implementation is completed. At any point of time
during the day a minimum of two resources shall be available.
Uninterrupted services of helpdesk shall be available to all the domestic and overseas branches
situated in different time zones all through their respective working hours.
During AMC period the requirements are specified in section 3.3: Warranty and Annual
Maintenance.
1.2.8 Information Security
System should have standard input, communication, processing and output validations and
controls. System hardening should be done by bidder. Access controls at DB, OS, and Application
levels should be ensured in compliance to the Information Security Policy of the Bank.
1.3 Invitation for Bids
The Bank invites RFP for a turnkey project for implementation of EWIRM Solution for advanced
approaches under Basel II, Basel III and RBI guidelines. The broad scope of the project envisages
installation, customization, parameterization, implementation, and maintenance of application
software, system software, database, interfaces etc. as well as supply, installation &
maintenance of related hardware at primary and disaster recovery data centers of the Bank,
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 24 of 250
with training to designated personnel of the Bank and its subsidiaries and group entities.
Each Bidder should notify the Bank of any error, fault, or discrepancy found in this RFP
document but not later than 12.07.2013. The Bank’s responses to the queries raised by
proposed bidders will be put on the Bank’s website.
The Bidders shall, by responding to the Bank’s RFP document, be deemed to have accepted the
terms as stated in this RFP document.
The bidder shall ensure compliance of Central Vigilance Commission guidelines (CVC) issued/ to
be issued from time to time pertaining to works covered under this RFP.
1.3.1 Disclaimer
The information contained in this Request for Proposal (RFP) document for implementation of
EWIRM Solution under Basel II and Basel III or information provided subsequently to Bidder(s) or
applicants whether verbally or in documentary form by or on behalf of the Bank, is provided to
the Bidder(s) on the terms and conditions set out in this RFP document and all other terms and
conditions subject to which such information is provided. The RFP document contains
statements derived from information that is believed to be true and reliable at the date
obtained but does not purport to provide all of the information that may be necessary or
desirable to enable an intending contracting party to determine whether or not to enter into a
contract or arrangement with Bank in relation to the provision of services.
The RFP document is not a recommendation, offer or invitation to enter into a contract,
agreement or any other arrangement, in respect of the services. The provision of the services is
subject to observance of selection process and appropriate documentation being agreed
between the Bank and any successful Bidder as identified by the Bank, after completion of the
selection process as detailed in this document. No contractual obligation whatsoever shall arise
from the RFP process unless and until a formal contract is signed and executed by duly
authorized officers of Canara Bank with the Bidder. Each Bidder should conduct their own
investigations and analysis and should check the accuracy, reliability and completeness of the
information in this RFP and where necessary obtain independent advice. The Bank makes no
representation or warranty and shall incur no liability under any law, statute, rules or
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 25 of 250
regulations as to the accuracy, reliability or completeness of this RFP. The Bank may, at its
absolute discretion, but without being under any obligation to do so, update, amend or
supplement the information in this RFP.
2. Instructions for Bid Submission
2.1 General Instructions
2.1.1 Cost of Application/ Bid Document
Application Money of `1,00,000/‐ (Rupees One Lakh only) by way of Demand Draft/ Banker’s
Cheque/ Pay Order issued by a Scheduled Commercial Bank favoring Canara Bank, payable in
Bangalore, which is non‐refundable, must be submitted separately along with RFP response.
The RFP documents can be downloaded from Bank’s Website and Govt. Web site (National
Information Center Website). The cost of application/bid document should be deposited at the
time of submitting the response.
All costs and expenses (whether in terms of time or material or money) incurred by the
Recipient/ Bidder in any way associated with the development, preparation and submission of
responses, including but not limited to attendance at meetings, discussions, demonstrations,
site visits, etc. and providing any additional information required by the Bank, will be borne
entirely and exclusively by the Bidder.
2.1.2 Bid Security (E.M.D)
The Bidder shall furnish, as part of their Bid, a Bid security in the form of Demand Draft/Banker’s
Cheque/ Pay order only. The Bid security is required to protect the Bank against the risk of
Bidder’s conduct, which would warrant the security’s forfeiture.
The Bid security shall be denominated in Indian Rupees and shall be in the following form:
• Demand Draft/Banker’s Cheque/ Pay Order, issued by a Scheduled Commercial Bank in
India, drawn in favor of Canara Bank payable at Bangalore for a sum of `50,00,000/‐(Rupees
Fifty Lakhs Only).
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 26 of 250
Any Bid not secured as detailed above, will be rejected by the Bank, as non-responsive.
Unsuccessful Bidders’ Bid security will be refunded within 30 days after signing the agreement
with the successful bidder without any interest.
The successful Bidder’s Bid security will be discharged upon the Bidder signing the Contract and
furnishing the performance guarantee as per the format mentioned in Annexure 11.11:
Performance Bank Guarantee. No interest will be paid on the bid security
Bank reserves the right to forfeit the Bid security for any of the following reasons:
• If a Bidder withdraws their Bid after the due date of submission and during the period of Bid
validity specified by the Bidder on the Bid Form; or
• If a Bidder makes any statement or encloses any form which turns out to be false / incorrect
at any time prior to signing of Contract; or
• In the case of a successful Bidder, if the Bidder fails:
- To sign the Contract within a period of 21 days from the date of communication of the
results to the bidder by the Bank; OR
- To furnish Performance Guarantee as mentioned in Section 3.1.7: Performance Bank
Guarantee herein.
2.1.3 Registration of RFP Response
Registration of RFP response will be effected by the Bank by making an entry in a separate
register kept for the purpose upon Bank receiving the RFP response in the above manner. The
registration must contain all documents, information, and details required by this RFP. The
submission should be in the format outlined in this RFP and should be submitted only through
hand delivery.
If the submission to this RFP does not include all the documents and information required or is
incomplete or submission is through Fax mode, the RFP response is liable to be summarily
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 27 of 250
rejected. All submissions, including any accompanying documents, will become the property of
Bank. The Bidder shall be deemed to have licensed, and granted all rights to the Bank to
reproduce the whole or any portion of their submission for the purpose of evaluation, to
disclose the contents of the submission to other Bidders who have registered a submission and
to disclose and/or use the contents of the submission as the basis for any resulting RFP process,
notwithstanding any copyright or other intellectual property right of the Bidder that may subsist
in the submission or accompanying documents.
2.1.4 Request for Additional Information
Bidders are required to direct all communications for any clarification related to this RFP, to the
designated Bank officials and must communicate the same in writing (address for
communication as given in table of schedule of activities and events). All queries relating to the
RFP, technical or otherwise, must be in writing only i.e. either via physical or electronic mail. The
Bank will try to reply, without any obligation in respect thereof, every reasonable query raised
by the Bidder in the manner specified. All responses posted in the website shall be part of the
RFP.
However, the Bank will not answer any communication reaching the bank later than 3.00 PM on
17.07.2013 this being the last date to receive clarifications.
The Bank may in its absolute discretion seek, but will be under no obligation to seek, additional
information or material from any Bidders after the RFP closes. Such information sought by the
Bank and material provided by the Bidder will be taken to form part of that Bidder’s response.
The Bank may in its sole and absolute discretion engage in discussion with any Bidder (or
simultaneously with more than one Bidder) after the RFP closes to clarify any response.
2.1.5 Pre‐‐‐‐Bid Meeting
The Bank plans to hold a pre‐bid meeting on 25.07.2013 at 3.00 p.m. at the address specified in
Bid details under introduction note in order to bring greater clarity on the scope of work and
terms of the RFP being floated. The Bidders are expected to use the platform to have all their
queries answered. Bidders are requested to send their queries relating to RFP to our office by e‐
mail, well in advance (latest by 17.07.2013 3.00 pm), so that the same could be discussed during
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 28 of 250
the Pre‐Bid meeting with interested Bidders. All queries along with bank responses will be
uploaded on the bank website on 29.07.2013.
Interested Bidders will be allowed to participate in the Pre‐Bid meeting. Also, bank will allow a
maximum of 2 representatives from each Bidder to participate in the pre‐bid meeting.
Non‐attendance at the Pre‐bid Meeting will not be a cause for disqualification of a Bidder.
The Bank will have liberty to invite its project/technical consultant or any outside agency,
wherever necessary, to be present in the pre‐bid meeting to reply to the queries of the Bidders
in the meeting.
2.1.6 Disqualification
Any form of canvassing/ lobbying/ influencing/ query regarding short listing, status etc. will
result in a disqualification of the Bidder. The Bank reserves the sole right to disqualify any
prospective bidder and no obligation to discuss regarding the same with the concerned bidder
being disqualified.
2.1.7 Language of Bid
The language of the bid response and any communication with the Bank must be in written
English only. Supporting documents provided with the RFP response can be in another language
so long as it is accompanied by an attested translation in English, from a recognized translator,
in which case, for purpose of evaluation of the bids, the English translation will govern. The Bank
reserves the right to accept or reject the translated scripts after performing reasonable due
diligence. The Bidder shall submit a fresh translation from another translator in case Bank is not
satisfied with the current one.
2.1.8 Period of Validity of Bids
Bids should remain valid for the period of at least six (6) months from the last date for
submission of bid prescribed by the Bank. A bid valid for a shorter period shall be rejected by the
Bank as non‐responsive. In case the last date of submission of bids is extended, the Bidder shall
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 29 of 250
ensure that validity of bid is reckoned from modified date for submission.
2.1.9 Amendment of RFP and Bidding Documents
At least 7 days prior to the last date for bid‐submission, the Bank may, for any reason, whether
at its own initiative or in response to clarification(s) sought from the prospective Bidders, modify
the RFP contents/ covenants by amendment. Clarification /amendment, if any, will be notified
on Bank’s website. No individual communication would be made in this respect. In case any
bidder has submitted the bid prior to the amendment has the right to resubmit the bid by
modifying or withdraw the bid. The bid last submitted or bid modified by the bidder will be
considered for evaluation.
2.1.10 Authorization to Bid
The proposal/ bid shall be signed by authorized representative backed by proper authority
/authorization/ resolution of the bidder and the bid submitted by the said authorized person
shall be binding on bidder.
• All pages of the bid shall be initialed by the person or persons signing the bid.
• Bid form shall be signed in full only in blue ink & official seal of the bidder affixed.
• Any inter-lineation, erasure or overwriting shall be valid only if they are initialed by the
person or persons signing the Bid.
• All such initials shall be supported by an official seal of the Bidder’s firm.
The proposal/bid must be accompanied with an undertaking letter duly signed by the
designated personnel as provided in Annexure 11.1 Undertaking From Bidder. The letter should
also indicate the complete name and designation of the designated personnel.
2.2 Documents Comprising the Bid
The Bidder has to submit 2 copies of the response and a soft copy of the complete technical Bid
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 30 of 250
in Microsoft Office 2007 / Open Office format on a Compact Disc (CD) super‐scribing “Soft Copy
of Technical Bid against RFP– RMW/01/2013-14 dated 10.07.2013” along with the technical bid.
The Bidder will not furnish the softcopy of the commercial bid.
The Bid prepared by the Bidder should comprise the following components:
1. ENVELOPE – I: Eligibility Criteria:
Separate envelopes with superscriptions as “Eligibility Criteria” should be included within the
overall Envelope. The Bidder should submit the following:
a. The sheet mentioning compliance/ non‐compliance to all the eligibility criteria
specifications with remarks and other requirements given in Annexure 11.2: Eligibility
Criteria Format.
b. All the proofs required for eligibility criteria as mentioned in Section 4.3: Eligibility Criteria
Format
Bid Document Cost and Bid Security: Separate envelopes with superscriptions as “Bid
document cost” and “Bid Security” should be included within the overall Envelope. The Bidder
should submit the following:
c. Cost of Application/ Bid Document – a Demand draft/Bankers Cheque/Pay Order of
`1,00,000 and Bid Document
d. Bid Security (Earnest Money Deposit) – a Demand draft/Bankers Cheque/Pay Order of
`50,00,000
2. ENVELOPE – II: Technical Bid :
Technical Bid: Separate envelopes with superscriptions as “Technical Bid and Masked
Commercial Bid” should be included within the Envelope II.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 31 of 250
a. Technical Bid
b. Masked Commercial Bid
The Bidder should submit compliance / non‐compliance to all the specifications with remarks
and other requirements given in the Bid Document and Scope of Work.
The Technical Bid should be complete in all respects and contain all information asked for,
except commercial prices. The Technical Bid should include all items asked for in bid document.
The technical offer should not contain any price information. The Technical Offer should be
complete and indicate that all products and services asked for are quoted. For example, the
Technical Bid should mention that Annual Maintenance Charges (AMC) etc. are included in the
Commercial Bid, without mentioning the actual amounts in the Technical Bid and terms of
Payment, Delivery and any other conditions, which may appear in the Commercial Bid. The
Bidder should enclose a copy of the Masked Commercial Bid (as per the format provided in
Annexure 11.6.2) as per price schedule without the prices (please put ‘X’ mark wherever prices
are quoted) along with other bid documents for evaluation purpose.
3. ENVELOPE – III: Commercial Bid:
The Commercial Bid should give all relevant price information and should not contradict the
Technical Offer in any manner. Please note that if any envelope is found to contain both
technical and commercial bid together, that bid will be rejected.
The details required under Annexures as mentioned in section 2.2.1 below shall also be
enclosed. The Bank may reject any proposal not containing all the requirements called for in
Annexures.
The Technical Bid of the eligible Bidders will be opened first for evaluation. Final bidder would
be decided by Techno – Commercial Evaluation.
Prices quoted by the Bidder shall be fixed during the Bidder’s performance of the Contract and
shall not be subject to variation on any account, including exchange rate fluctuations, changes in
taxes, duties, levies, charges etc. A Bid submitted with an adjustable price quotation will be
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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treated as nonresponsive and will be rejected. All costs proposed by the Bidder will have to be
rational. Details of total costs provided will have to be in line with the itemized costs.
2.2.1 List of Documents
Envelope Documents Reference
ENVELOPE –I
Eligibility Criteria
Eligibility Criteria Annexure 11.2: Eligibility Criteria
Cost of Application/
Document
Section 2.1.1: Cost of Application/ Bid
Document
Bid Security (Earnest Money
Deposit)
Section 2.1.2: Cost of Application/ Bid
Document
ENVELOPE – II
Technical Bid
Technical Bid
Undertaking from Bidder Annexure 11.1: Undertaking from Bidder
Bid Offer Covering Letter Annexure 11.7: Bid Offer Covering Letter
Cover Letter for Technical Offer Annexure 11.3: Cover Letter for
Technical Bid
Technical Bid Format Annexure 11.4: Technical Bid Format
Reference Site Details Annexure 11.8: Reference Site Details
Particulars of Bidder Annexure 11.9: Particulars of Bidder
Past Experience Details Annexure 11.10: Past Experience Details
Manufacturers’/ Producers’
Authorization Form
Annexure 11.12: Manufacturers’/
Producers’ Authorization Form
Implementation Team Profile Annexure 11.13: Implementation Team
Profile
Project Timelines Annexure 11.14: Important Project
Timelines
Masked Commercial Bid Annexure 11.6.2: Masked Commercial
Bid (Bill of Material) Format
Compact Disc Section 2.2. Documents comprising the
Bid
ENVELOPE – III:
Commercial Bid
Commercial Bid
Cover Letter for Commercial
Bid
Annexure 11.5: Cover Letter for
Commercial Bid
Commercial Bid (Bill of Annexure 11.6: Commercial Bid (Bill of
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 33 of 250
Envelope Documents Reference
Material) Format Material) Format
2.2.2 Sealing and Marking of Bids
1. The Bidder has to submit 2 copies of the response and a soft copy of the complete technical
Bid in Microsoft Office 2007 / Open Office format on a Compact Disc (CD) super‐scribing
“Soft Copy of Technical Bid against RFP–RMW/01/2013-14 dated 10.07.2013” along with
the technical bid. The Bidder will not furnish the softcopy of the commercial bid.
2. The Bidder shall seal the envelopes containing “Envelope – I: (a) Eligibility Criteria, (b) Cost
of application and Bid security”, “Envelope – II: Technical Bid” and “Envelope – III:
Commercial Bid” separately and the three envelopes shall be enclosed and sealed in a
SINGLE OUTER ENVELOPE marked as
“ORIGINAL: Solution to Implement Enterprise Wide Integrated Risk Management
Architecture under Basel II and Basel III Guidelines‐‐‐‐FINAL BID”
3. The inner and outer envelopes shall:
a. be addressed to the Bank at the address given; and
b. bear the following in separate envelopes
i. “Solution to Implement Enterprise Wide Integrated Risk Management Architecture
under Basel II and Basel III –Eligibility Criteria”
ii. “Solution to Implement Enterprise Wide Integrated Risk Management Architecture
under Basel II and Basel III – Non‐Price Bid (Technical Bid)”,
iii. “Solution to Implement Enterprise Wide Integrated Risk Management Architecture
under Basel II and Basel III – Price Bid (Commercial Bid)”,
c. All envelopes should indicate on the cover the name and address of the Bidder.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 34 of 250
4. If the outer envelope is not sealed and marked, the Bank will assume no responsibility for
the bid’s misplacement or premature opening.
2.3. Key Guidelines for preparing RFP response:
Bidder’s proposal should strictly conform to the specifications mentioned here in the RFP.
Proposals not conforming to the specifications will be rejected subject to the Bank’s discretion.
Any incomplete or ambiguous terms / conditions / quotes may result in disqualification of the
offer at Bank’s discretion. The Bidder has to offer specific remarks for technical requirements
and clearly confirm compliance. Any deviations on technical requirements should be clearly
informed in Remarks column.
Deviation/ comments on other terms prescribed by the Bank are to be provided in a separate
section in Technical Bid. The Bank is not bound to evaluate the deviations mentioned at any
other section of the bid.
For supplementary information a separate sheet should be used.
All pages should be numbered (like 1/xxx, 2/xxx where xxx is last page number of Bid document)
and initialed under the company seal.
Technical Bid documents are to be properly filed in a box‐ file and should not contain any loose
papers.
Canara Bank reserves the right to reject any or all proposals. Similarly, it reserves the right not to
include any Bidder in the final short‐list.
3. Additional Instructions for Bidders
3.1 General Instructions
3.1.1 Nature of Bid
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 35 of 250
a. The bid shall be submitted by an SI, thus the SI will be the bidder.
b. One SI cannot submit more than one bid.
c. The OEMs joining SI will be the product vendors.
d. One OEM can bid only with one Bidder (SI).
e. The SI is responsible to carry out the process and accomplish the assigned task.
f. Any third party (For e.g.: in the nature of a consultant) apart from the SI and the OEM
cannot be part of the bid.
g. A bidder to this RFP acting as the SI cannot participate in the bid submitted by another
bidder (SI) as the OEM of that bid.
h. One bidder can bid along with multiple OEMs (but only one OEM for one risk solution) to
provide EWRIM Solution through this bid subject to point g above.
i. Any subcontracting and assignments by the Bidder, of the work stated within this RFP is not
permissible
j. The bank intends to procure only Perpetual Licenses. The bank should have the entitlement
/ right to use these licenses without any restriction. The bidder (SI) should also share the
official & authentic license definition of all the proposed OEM's.
k. All the new software release/version / upgrades or otherwise for any reason should be
made available to the Bank and the bank is not liable to pay / oblige SI or any OEM any
additional charges / fees pertaining to third party royalty charges etc. And also this should
not be the reason to restrict the bank from upgrading to the new release / new version of
the software.
l. The OEM should endorse the hardware & related software sizing, stating that technically
their software can be deployed on the proposed sizing. This can be through declaration or
sharing authentic / official benchmark reports.
3.1.1.1 Participation Methodology
In this bid, either the Indian Agent on behalf of the OEM or OEM itself can act as the product
vendor but both cannot participate simultaneously for the same product in the bid.
If an agent participates on behalf of the OEM, the same agent shall not participate on behalf of
another OEM in this bid for the same item/product.
In the event of Agent/Representative being not able to perform the obligations as per the
provisions of the contract/warranty, the prime Bidder (SI) should assume complete
responsibility on behalf of the OEM/Agent for providing end-to-end solution i.e., technology,
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 36 of 250
personnel, financial and any other infrastructure that would be required to meet intent of this
RFP.
3.1.2 Source Code
a. Bidder has to keep source code of proposed solution with approved / recognized escrow
agency under escrow arrangements mutually acceptable to the bank and Bidder but at
Bidder’s cost.
b. The application software should mitigate Application Security Risks, at a minimum, those
discussed in OWASP top 10 (Open Web Application Security Project)
c. The Bank reserves the right to Audit the Application / Source Code by suitable Security
Auditor.
d. The Bidder shall provide complete and legal documentation of all subsystems, licensed
operating systems, licensed system software, and licensed utility software and other
licensed software. The Bidder shall also provide licensed software for all software products
whether developed by it or acquired from others as part of the project. The Bidder shall also
indemnify the Bank against any levies / penalties on account of any default in this regard.
e. In case the Bidder is coming with software or hardware which is not its proprietary software
or hardware, then the Bidder must submit evidence in the form of agreement it has entered
into with the software vendor or hardware vendor which includes support from the software
vendor or hardware vendor for the proposed software and hardware for the full period
required by the Bank.
3.1.3 Information Ownership
All information processed, stored, or transmitted by successful Bidder’s equipment belongs to
the Bank. By having the responsibility to maintain the equipment, the Bidder does not acquire
implicit access rights to the information or rights to redistribute the information. The Bidder
understands that civil, criminal, or administrative penalties may apply for failure to protect
information appropriately.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 37 of 250
Any information considered sensitive by the Bank must be protected by the successful Bidder
from unauthorized disclosure, modification or access. The bank’s decision will be final.
Types of sensitive information that will be found on Bank system’s which the Bidder plans to
support or have access to include, but are not limited to: Information subject to special
statutory protection, legal actions, disciplinary actions, complaints, IT security, pending cases,
civil and criminal investigations, etc. The successful bidder shall exercise adequate judgment to
decide if a particular information is sensitive and consult with the Bank in case of doubts.
The successful Bidder shall not publish or disclose in any manner, without the Bank’s prior
written consent, the details of any security safeguards designed, developed, or implemented by
the Bidder or existing at any of the Bank location. The Bidder will have to develop procedures
and implementation plans to ensure that IT resources leaving the control of the assigned user
(such as being reassigned, removed for repair, replaced, or upgraded) are cleared of all Bank
data and sensitive application software.
3.1.4 Security Configuration, Monitoring and Audit
The baseline security configuration of Operating System, Database, Web server and all other
applications to be done by the bidder, according to the industry best practices.
Compliance with security best practices may be monitored by periodic computer security audits
performed by or on behalf of the Bank. The periodicity of these audits will be decided at the
discretion of the Bank. Periodicity for Regulatory Audits would be required as per the rules and
guidelines laid down by the regulator or as required by the regulator. These audit plan to
include, but are not limited to, a review of: access and authorization procedures, physical
security controls, input/output controls, DB controls, backup and recovery procedures, network
security controls and program change controls.
To the extent that the Bank deems it necessary to carry out a program of inspection and audit to
safeguard against threats and hazards to the confidentiality, integrity, and availability of data,
the Bidder shall afford the Bank’s representatives access to the Bidder’s facilities, installations,
technical resources, operations, documentation, records, databases and personnel. The Bidder
must provide the Bank access to various monitoring and performance measurement systems
(both manual and automated). The Bank has the right to get the monitoring and performance
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 38 of 250
measurement systems (both manual and automated) audited without prior approval / notice to
the Bidder.
3.1.5 Considerations for Proposed Hardware & Software to support the EWIRM Solution
1. All software like RDBMS should be of the latest version and should be compatible to exiting
RDBMS.
2. The Bidder should provide the data sheets for all the hardware proposed.
3. Roadmap for the CPUs proposed for Database and Application servers should be presented.
4. All servers shall be configured with two numbers sufficient storage capacity of Internal Disk
Drive with Mirroring and tape/ Digital Audio Tape (DAT) drives
5. The servers proposed should have 64‐bit Quad‐core processor and latest operating system.
The offered OS should be the Enterprise version of the 64 bit and should be the latest
version.
6. All database servers should be of same capacity and models.
7. Application and Database Servers should be vertically scalable (‘in box’ upgradable) with
respect to the number of CPUs and Memory configured so as to meet the bank’s scalability
requirements as well as horizontally scalable.
8. The CPU type offered should be of the same generation / architecture across all servers and
should be of the latest generation.
9. The Memory Chipset should be of Double Data Rate 2 (DDR2) or Double Data Rate 3 (DDR3)
memory.
10. The Bidder is expected to provide SAN based storage facility for hosting EWIRM Solution
systems production, test and development data. All past and future data would be stored on
a single infrastructure i.e. new SAN. The new SAN storage capacity is required for 7 years for
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 39 of 250
the data at the DC and DRS each. The new solution proposed by the Bidder should be capable
of accessing the existing SAN for the purpose of data migration and data archival as and
when required. The bidder will also ensure that the data ultimately integrated to the
proposed EDW and facilitate this in association with the SI for the EDW project.
11. If the solution suggested by the bidders necessitates additional capacity, then the bidder
would need to provide accordingly to meet the RFP and Service Level Agreement (SLA)
requirements.
12. The Bidder should design the hardware taking note of parameters for CPU utilization,
memory utilization, disk Input/output capacity, and Storage capacity etc. as defined in the
RFP so as to meet the business requirements of the bank as well as Service Level Agreement
requirements defined in this RFP. The proposed SAN (Storage Area Network) and storage
management solution should support combinations of mostly used RAID levels (e.g. RAID
0,1,5,6 etc.). The complete production data should be on a combination of RAID 5.
13. The tape library offered should be of the latest generation and of modular design to allow
configuration, and addition of capacity to increase performance. Offered Tape Drives in the
Tape Library should be LTO5.
14. The Storage Array proposed by the Bidder should be Enterprise Class Monolithic Storage with
no Single Point of Failure. (Monolithic implies that the storage should have capabilities of
addition of Front End Boards, Back End Boards, and Cache Boards etc.).
15. The Storage System should support industry standard applications / databases, including but
not limited to MS SQL Server, Oracle, MySQL, DB2, Web and Application Servers, MS
Exchange, Lotus Notes etc.
16. The storage system should support heterogeneous multi‐host connectivity. The system
should facilitate connectivity to various flavors of Operating Systems (OS), including but not
limited to, HP‐UX, IBM AIX, SUN Solaris, Linux, Microsoft Windows, etc.
17. The switch should have support of all leading SAN / NAS disk arrays and tape libraries and
bidder should ensure connectivity of existing SAN to proposed SAN switches.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 40 of 250
18. The hard disk proposed for production storage in the array should be FC (Fiber Channel) or
SAS (serial attachment SCSI) drives only.
19. The proposed Tape Library should be offered with redundant power supplies and cooling
fans.
20. Offered tape library/ tape drives in the library should have a minimum of two redundant
connections to SAN switches.
21. The Management console/interface of the proposed tape library shall provide the following
functionalities:
a. Manage Tape Drives and Cartridges
b. Configure network parameters
c. Should have GUI Front panel
22. All the components (hardware, software etc.) in the DC site should be replicated in the DR
(except Test and Development environment). The proposed solution should have full
capability to support database to database replication and storage to storage replication
between DC and DR with a Recovery Point Objective (RPO) of 15 minutes and Recovery Time
Objective (RTO) of 2 hours. The replication between DC and DR should be possible in both
directions.
3.1.6 Performance Guidelines
The proposed solution should comply with the following guidelines on performance and solution
components in minimum.
a. Bidder should clearly specify the detailed configuration and specifications of the applications
and corresponding hardware required at various levels of performance and supply a detailed
Bill of Materials (BoM) with the part numbers for the hardware based on the technical
requirements. The bidder should separately list down the reasons for the recommended
hardware configurations and specifications.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 41 of 250
b. The bidder has to explain through proper calculations how the performance of the system
vis‐à‐vis business statistics, projected growth, redundancy, projected growth in functional
requirements, concurrent users, performance parameters expected on peak load, VaR or
other parameter calculations, transactions handled per second, quarter‐end and year‐end
activity etc., are ensured. The bidder should provide data on any other parameter which
would be required.
c. Bidder to indicate the timing of the performance testing (before/after installation of
hardware) Bidder will do this at a mutually agreed location at his cost.
d. Bidder should also provide data on the solution as how the individual components offered
under the solution (application and associated hardware) would be able to meet the current
volumes as well as the future scalability requirements.
e. The bidder should provide information on industry standard benchmarks for the system such
as TPC‐C certified by Transaction Processing Council and / or Oracle TPMC that is made
available in respective web‐ sites. The bidder has to furnish the details of the configuration of
the servers, OS and databases used in such benchmarking exercise for TPC‐C, Oracle TPMC
etc. and relate the same to the server configurations proposed for Bank’s requirement.
f. The bidder should also provide the benchmarks with Risk Management application software
preferably conducted with real time loads for similar requirement or as acceptance test with
credential and details of references involved in conducting such benchmarks. The Bidder has
to relate the same to the model and configuration of the hardware proposed for Bank’s
requirement.
g. Besides the above, the bidder may furnish the details of any other benchmarks either
Industry standard such as “SPEC” ratings or for other Financial Institutions with due
relevance.
h. The bidder may also furnish certified performance details from past implementations of
similar nature.
i. Bank may advise the bidder to conduct the benchmark when the systems are ready for
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 42 of 250
dispatch to Bank’s site or after completion of installation and evaluate performance. It is for
the bidder to establish that the sizing is proper for the requirement and to demonstrate the
performance to Bank’s designated officials and project consultants.
It will be the responsibility of the selected bidder to coordinate with Bank’s system Integrator for
the successful integration with Core Banking Solution (existing or higher versions) and EDW (as
and when operational). Role of the bank is limited to facilitating coordination between the
bidder (System integrator) and the system integrator for the CBS and EDW (as and when
operational)
3.1.7 Performance Guarantee
Within the period prescribed under Annexure 11.14 from date of receipt of notification of
contract award, the Bidder shall furnish to the bank, the Performance Guarantee for an amount
of 10% of the contract value which would be valid for the entire project period or entire period
of 7 years.
1. The proceeds of the performance Guarantee shall be payable to the Bank as compensation
for any loss resulting from the Bidder’s failure to complete its obligations under the
Contract. The Performance Guarantee shall be denominated in Indian Rupees and shall be
by way of Bank Guarantee issued by a Private Sector/ Public Sector Banks in India (other
than Canara Bank), acceptable to the bank in the Format, in Annexure 11.11 Performance
Bank Guarantee.
2. The performance guarantee will be discharged by the Bank and returned to the Bidder after
30 days following the date of completion of the Bidder’s performance obligations under the
contract.
3. In the event of any contract amendment, the Bidder shall, within 30 days after receipt of
such amendment, furnish the amendment to the performance guarantee, rendering the
same valid for the duration of the contract as amended.
3.1.8 Service Level Agreement (SLA)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 43 of 250
Bank expects that the Bidder shall be bound by the Service Levels described in this document.
Service Levels will include Availability measurements and Performance parameters. Bank
requires the Bidder to provide reports for all availability and performance parameters a log of all
issues that have been raised and Closed/ Pending Closure by the Bidder. The frequency of these
reports would be Weekly, Monthly, Quarterly and Yearly as mutually agreed. Apart from reports
on each availability and performance measurement parameter mentioned below, the reporting
should also include the following:
1. Utilization of CPU, RAM, Hard Disk, I/O (Peak and Average)
2. Percentage of CPU utilized by the system and user activity.
3. CPU utilization broken down by user CPU and system CPU. Tabular report of CPU, Memory,
NIC and I/O utilization (peak and average) by application, if possible.
4. Percentage of physical memory utilized by system and user processes.
5. Problem Trends
6. Call Resolution Time
Audits will normally be done on monthly/quarterly basis or as required by Bank and will be
performed by Bank or Bank appointed third party agencies.
SLA for Hardware & Software
Availability Measurements Expected
Service Level
Base Amount on
which penalty will be
calculated
Penalty
Availability of Business
Infrastructure (Core Application
Servers, Core Database Servers,
Storage, SAN Switch, Tape
Library,
98.5% Value of the said
business
infrastructure for DC
or DRC,
as the case may be.
10%
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 44 of 250
Availability Measurements Expected
Service Level
Base Amount on
which penalty will be
calculated
Penalty
RDBMS and related components
etc.) in DC and DRC
Availability of all other
infrastructure, all other
software components and Test
and Development infrastructure
98.5% Value of the relevant
infrastructure
10%
The term ‘business infrastructure’ mentioned in this document shall include all capital costs of
hardware, associated software and RDBMS (at DC or DRC, as the case may be) delivered as of
the point of time when the penalty is levied. The cost of AMC/ ATS from the second year
onwards will not be treated as capital cost and therefore excluded. The business infrastructure
shall also exclude the capital cost of all components related exclusively to other infrastructure
and Test and Development infrastructure, for the purpose of penalty calculation.
Type of
Infrastructure
Performance
Measurement
Expected
Service
Level
Base Amount on
which penalty will be
calculated
Penalty
System
Response
Time
End to End
response time
within the DC Time
or DR (from the
CRMS & ORMS
Application to the
Database and back)
should be < 0.5
milliseconds
98.5% The bidder is to
upgrade the
Hardware along with
related software and
services without any
additional cost to the
Bank, if service level
is not met. Until
Service level is met,
penalty will be
charged on the value
of the business
infrastructure at DC
or DRC, as the case
may be.
10%
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 45 of 250
Type of
Infrastructure
Performance
Measurement
Expected
Service
Level
Base Amount on
which penalty will be
calculated
Penalty
Disaster
Recovery Site
Availability
Business
operations to
resume from
Disaster Recovery
Site within 4 hours
of the Data
Centre failing and
vice versa.
100% Penalty will be
charged on the value
of the business
infrastructure at DC
or DRC, as the case
may be.
10%
Data Point
Availability
Recovery Point
Objective (RPO) of
15 minutes.
100% Penalty will be
charged on the value
of the business
infrastructure at DC
or DRC, as the case
may be.
10%
3.2 Payment Terms
For CRMS, ORMS, MRMS and Integrated Capital Computation and Reporting Module
Amount Basis
40% After completion of successful UAT of the entire EWIRM Solution
(UAT will be considered as complete on proper sign-off given by the bank based
on the review of UAT Scenarios, UAT Methodology, Expected & Actual Results and
its Complete Documentation by the Bidder)
20% On completion of 1 year of live implementation of the EWIRM Solution
(Live Implementation implies EWIRM Solution has been fully implemented across
the enterprise)
20% On completion of 2 years of live implementation of the EWIRM Solution
10% On completion of 3 years of live implementation of the EWIRM Solution
10% Post approval from RBI for migration to advanced approaches
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 46 of 250
Note: In the event of any failures of the system post live implementation, the Bank reserves
the right to withhold further payments.
For Hardware, Operating System and RDBMS
Amount Basis
50% On delivery and installation and submission of invoice with proof of delivery and
installation
40% On commissioning of Hardware, RDBMS, System Software, Communication
equipment etc. and signing of hardware UAT.
10% After completion of warranty period
Note: The payment Terms for AMC, ATS and Facilities Management have been separately
articulated in the respective sections.
Bank will release the payment after deduction of applicable TDS/Levies at source.
3.2.1 Price Composition
The Bidder is expected to quote unit price in Indian Rupees (without decimal places) for all
components (hardware, software etc.) and services on a fixed price basis as part of the
commercial Bid inclusive of all costs and taxes like customs duty, excise duty, import taxes,
freight, forwarding, insurance, delivery, installation, training etc. at the respective delivery
location of the bank but exclusive of only applicable (in India) Sales Tax/VAT, Service Tax and
Octroi / Entry Tax / equivalent local authority cess, which shall be paid / reimbursed on actual
basis on production of bills. Further, receipts of such payments made to relevant authorities
must be produced for Octroi / Entry Tax / equivalent local authority cess. The Bank will not pay
any other taxes, cost or charges.
3.2.2 Road Permit
In case of receiving of hardware to the area where Road Permit is required for transportation of
goods, it is the responsibility of the bidder to arrange for the same in advance without any extra
cost to the bank.
3.2.3 Right to Alter Quantities
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 47 of 250
The bank will be free to either reduce or increase the quantity to be purchased by 10% on the
same terms and conditions.
The bank also reserves the right to place further / repeat order on the same terms and
conditions within a period of 24 months from the date of purchase order.
3.2.4 Payment Term for Facilities Management
The payment will be released at the end of every quarter.
3.3 Warranty & Annual Maintenance
3.3.1 Maintenance Standard during Warranty & Post Warranty Maintenance
1. The warranty period for the Hardware and Software shall be for 1 year from the date of go-
live of the Enterprise Wide Integrated Risk Management system. AMC period starts after
completion of warranty period.
2. AMC payment due shall be released half yearly in advance against Bank Guarantee for the
value of AMC amount or shall be released after completion of half year.
3. The Bidder shall furnish a Bank Guarantee issued by any scheduled commercial bank in India
(other than Canara Bank) and acceptable to the Bank for an amount equal to the value of
AMC for one year. Thereafter, the BG shall be furnished every year for the value of AMC
amount due for that year.
4. The BG shall be delivered to the Bank at least 30 days prior to the expiry of warranty period.
5. During Warranty Period/ AMC, Bidder guarantees a minimum uptime of 98.5 % on monthly
basis for the entire turnkey solution provided. This will be subject to a ceiling of not more
than 120 minutes cumulative downtime. Successful Bidder is expected to submit a report
within a week after expiry of every calendar month in this regard. Delays, if any, on account
of procurement of spares will not be exempted while reckoning the uptime SLA.
6. During maintenance period also, the Bidder guarantees on monthly basis an uptime of
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 48 of 250
98.5% of the entire solution provided. Accordingly it is expected that necessary redundancy
is built into the solution for all components whether software or hardware.
7. During the period of AMC, if the service provided by the Bidder is not satisfactory, the bank
reserves the right to terminate the AMC contract and appoint any other agency at the risk
and cost of the Bidder.
8. The maximum response time for a maintenance complaint from the site of installation (i.e.
time required for Bidder’s maintenance engineers to report to the installations after a
request call / fax /e‐mail is made or letter is written) shall not exceed One hour.
9. In the event of failure of maintaining the uptime SLA (based on point no. 5 &6 above)
liquidated damages of 20,000/‐ per hour with a grace period of 120 minutes would be
levied up‐to max of 10% of overall value of the project. The liquidated damages mentioned
under clause 3.3 shall be independent of liquidated damages/penalty mentioned in clause
5.2.
3.3.2 Terms and Conditions During Warranty and AMC Period
During the period of contract up to completion of Warranty and also during annual maintenance
(if contracted), the selected bidder shall do the following:
1. Any engineering changes/ upgradations applicable to the Hardware shall be
communicated to the Bank by the Bidder within a period of one month from the date of
release/observation. It shall be supplied, installed and commissioned free of cost by the
bidder. The bank reserves the right to procure the update/enhancement/system software
upgrade and at an extra cost, if the software is not under Warranty and AMC.
2. Any software support like update/enhancement/software upgrade etc. released till the
completion of warranty and during annual maintenance (if contracted) shall be supplied,
installed and commissioned free of cost by the bidder. However, any such software
support like update/ enhancement/upgrade shall be communicated to the Bank by the
Bidder within a period of one month from the date of release. The Bank reserves the right
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to procure the update/enhancement/ System software upgrade and at an extra cost, if
the software is not under warranty and AMC.
3. If any software and Hardware upgrades and updates provided by the OEM as free of cost,
it should be provided and installed & configured by the selected bidder during Warranty
and AMC support [If contracted].
4. Any corruption in the Software or media shall be rectified during the full period of the
contract including Warranty and AMC, if contracted, at no extra cost to the Bank.
5. The system spare parts/services, as and when required, and complete maintenance of the
System during warranty period and AMC (if contracted), shall be supported for a period
not less than 6 years from the date of acceptance of live implementation of the System
by the Bank.
6. Service Support is defined specifically as helpdesk, update/enhancement, upgrade,
technical guidance, technical consultancy, enablement of features and functionality,
problem solving and troubleshooting, providing technical solution, rectification of bugs,
enabling features of the software already provided, providing additional user controlled
reports, Changes in configuration & settings, device configuration, enabling
parameterized features, future product information, migration, manpower resource
allotment for pre-planned activity, co-ordination for changes in structure, etc.
7. The support shall be given in person or through telephone, FAX, letter and E-mail within a
reasonable time as the case may be.
8. In future, if any configuration changes are required, it should be done by the bidder
during warranty and AMC period [if contracted]. However bank will intimate the bidder
well in advance for doing such configuration changes. Configuration changes may be done
either centrally or remotely. However If bidder personnel required at the remote place as
informed by the Bank, the bidder should arrange the personnel to make such
configuration / cooperation at the respective location. However in case the bidder has
any concerns, it should be informed to the bank in writing with reason for taking
appropriate/ amicable/ mutually agreed on decision in the matter.
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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9. The Bank reserves the right to modify/update the parameter files/configuration with
required awareness of its consequences and any such modification/ updation will be
recorded for information of the selected bidder without any impact on the media as per
OEM descriptions.
10. Only licensed copies of software shall be supplied and ported. The bidder shall grant an
irrevocable perpetual license to the Bank to use the software. Further, all software
supplied shall be of latest version.
11. The Bidder shall also give an undertaking as a part of this contract to provide technical
consultancy and guidance for successful operation of the Risk Solutions and its expansion
in future by the Bank during the warranty and AMC period (if contracted). The said
undertaking letter shall be submitted along with the bid, otherwise, the bid is liable for
rejection.
12. Preventive maintenance shall be compulsory during Warranty and AMC period [if
contracted]. Preventive maintenance activity should be completed every quarter and
report should be submitted to the bank. Preventive maintenance activity should take care
of physical verification, device configuration verification, device health checkup, cleaning
of devices, fine-tuning the configuration, security checkup, verification of bugs/patches,
etc. The preventive maintenance report format shall be prepared by bank, the bidder
shall strictly follow the format of bank and submit the same for each location while
claiming AMC payment if contracted.
13. The image/video data stored on hard disk should be periodically taken as backup on
media provided by the Bank and handed over to the concerned branch.
14. The bidder shall provide centralized complaint booking facility to the bank and the dash
board, if available, shall be provided to the Bank. The method of booking complaints shall
be E-mail, Toll-free no, on line portal, web, etc.
3.4 Termination
3.4.1 Termination For Default
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The Bank, without prejudice to any other remedy for breach of contract, by written notice of
default sent to the Successful Bidder, may terminate this Contract in whole or in part:
a. if the Successful Bidder fails to deliver any or all of the deliverables within the period(s)
specified in the Contract, or within any extension thereof granted by the Bank; or;
b. If the Successful Bidder fails to perform any other obligation(s) under the contract.
c. If the Successful Bidder, in the judgment of the Bank has engaged in corrupt or
fraudulent practices in competing for or in executing the Contract.
Corrupt practice means the offering, giving, receiving or soliciting of anything of value or
influence the action of a public official in the procurement process or in contract execution; and
“fraudulent practice” means a misrepresentation of facts in order to influence a procurement
process or the execution of a contract to the detriment of the Bank, and includes collusive
practice among Bidders (prior to or after bid submission) designed to establish bid prices at
artificial non‐competitive levels and to deprive the Bank of the benefits of free and open
competition.
3.4.2 In the event, the Bank terminates the Contract in whole or in part, the Bank may procure,
upon such terms and in such manner as it deems appropriate, Goods or Services similar to those
undelivered, and the Successful Bidder shall be liable to the Bank for any excess costs for such
similar Goods or Services. However, the Successful Bidder shall continue performance of the
Contract to the extent not terminated.
3.4.3 Termination for Insolvency
If the Bidder becomes bankrupt or insolvent, has a receiving order issued against it, compounds
with its creditors, or, if the Bidder is a corporation, a resolution is passed or order is made for its
winding up (other than a voluntary liquidation for the purposes of amalgamation or
reconstruction), a receiver is appointed over any part of its undertaking or assets, or if the
Bidder takes or suffers any other analogous action in consequence of debt; then the Bank may,
at any time, terminate the contract by giving written notice to the Bidder. If the contract is
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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terminated by the Bank in terms of this Clause, termination will be without compensation to the
Bidder, provided that such termination will not prejudice or affect any right of action or remedy
which has accrued or will accrue thereafter to the Bank. In case, the termination occurs before
implementation in all the locations in terms of this clause, the Bank is entitled to make its claim
to the extent of the amount already paid by the Bank to the Bidder.
3.4.4 Termination – Key Terms & Conditions
The Bank shall be entitled to terminate the agreement with the Bidder at any time by giving
ninety (90) days prior written notice to the Bidder. The Bank shall be entitled to terminate the
agreement at any time by giving notice if:
The Bidder
a. has a winding up order made against it; or
b. has a receiver appointed over all or substantial assets; or
c. is or becomes unable to pay its debts as they become due; or
d. enters into any arrangement or composition with or for the benefit of its creditors; or
e. Passes a resolution for its voluntary winding up or dissolution or if it is dissolved.
The Bidder shall have right to terminate only in the event of winding up of the Bank.
3.4.5 Consequences of Termination
In the event of termination of the Contract due to any cause whatsoever, [whether consequent
to the stipulated term of the Contract or otherwise], The Bank shall be entitled to impose any
such obligations and conditions and issue any clarifications as may be necessary to ensure an
efficient transition and effective business continuity of the Service(s) which the Bidder shall be
obliged to comply with and take all available steps to minimize loss resulting from that
termination/breach, and further allow the next successor Bidder to take over the obligations of
the erstwhile Bidder in relation to the execution/continued execution of the scope of the
Contract.
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In the event that the termination of the Contract is due to the expiry of the term of the
Contract, a decision not to grant any (further) extension by the Bank, the Bidder herein shall be
obliged to provide all such assistance to the next successor Bidder or any other person as may
be required and as the Bank may specify including training, where the successor(s) is a
representative/personnel of the Bank to enable the successor to adequately provide the
Service(s) hereunder, even where such assistance is required to be rendered for a reasonable
period that may extend beyond the term/earlier termination hereof.
Nothing herein shall restrict the right of the Bank to invoke the Performance Bank Guarantee
and other guarantees, securities furnished and pursue such other rights and/or remedies that
may be available to the Bank under law or otherwise.
The termination hereof shall not affect any accrued right or liability of either Party nor affect the
operation of the provisions of the Contract that are expressly or by implication intended to
come into or continue in force on or after such termination.
3.4.6 Exit Option
1. The Bank reserves the right to cancel the contract in the event of happening one or more of
the following Conditions:
a. Failure of the successful Bidder to accept the terms of the contract and furnish the
Performance Guarantee within 21 days from the date of signing of the Contract by the
Bank and the Bidder.
b. Failure of the bidder to agree on the term of the contract within 21 days from the date of
communication of award by the Bank and sharing of terms of contract by the Bank. If the
bidder does not meet this criteria, then the Bank may at its discretion declare the next
best bidder as the successful bidder.
c. Failure of the successful Bidder to sign the contract within 7 days from the agreement on
the terms of the issue of Contract by the Bank
d. Delay in completing installation / implementation and acceptance tests/ checks beyond
the specified periods;
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e. Serious discrepancy in functionality to be provided or the performance levels agreed
upon, which have an impact on the functioning of the Bank.
f. In addition to the cancellation of contract, Bank reserves the right to appropriate the
damages through encashment of Bid Security/ Security Deposit /Performance Guarantee
given by the Bidder and retention money.
2. The Bank and the Bidder shall together prepare the Reverse Transition Plan as part of Bidder
exit plan. However, the Bank shall have the sole decision to ascertain whether such Plan has
been complied with.
3. Notwithstanding the existence of a dispute, and/or the commencement of arbitration
proceedings, the Bidder will be expected to continue the facilities management services. The
Bank shall have the sole and absolute discretion to decide whether proper reverse transition
mechanism over a period of 6 to 12 months, has been complied with.
4. Reverse Transition mechanism would typically include service and tasks that are required to
be performed / rendered by the Bidder to the Bank or its designee to ensure smooth
handover, transitioning of application knowledge, Bank’s deliverables, and maintenance and
facility management.
3.4.7 Termination for convenience
The Bank, by written notice sent to the Bidder, may terminate the Contract, in whole or in part,
at any time at its convenience. The notice of termination shall specify that termination is for the
Bank’s convenience, the extent to which performance of work under the Contract is terminated
and the date upon which such termination becomes effective.
3.4.8 Force Majeure
a. Notwithstanding the provisions of TCC (Terms & Conditions of the Contract), the Bidder shall
not be liable for forfeiture of its performance security, liquidated damages, or termination
for default if and to the extent that its delay in performance or other failure to perform its
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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obligations under the Contract is the result of an event of Force Majeure.
b. For purposes of this clause, “Force Majeure” means an event beyond the control of the
Bidder and not involving the Bidder’s fault or negligence and not foreseeable. Such events
may include, but are not restricted to, acts of the Bank in its sovereign capacity, wars or
revolutions, fires, floods, epidemics, quarantine restrictions, and freight embargoes.
c. If a Force Majeure situation arises, the Bidder shall promptly notify the Bank in writing of
such condition and the cause thereof. Unless otherwise directed by the Bank in writing, the
Bidder shall continue to perform its obligations under the Contract as far as is reasonably
practical, and shall seek all reasonable alternative means for performance not prevented by
the Force Majeure event.
4. Evaluation Methodology
Each Recipient acknowledges and accepts that the Bank may, in its sole and absolute discretion,
apply whatever criteria it deems appropriate in the selection of organizations, not limited to
those selection criteria set out in this RFP document. The issuance of RFP document is merely an
invitation to offer and must not be construed as any agreement or contract or arrangement nor
would it be construed as any investigation or review carried out by a Recipient. The Recipient
unconditionally acknowledges by submitting its response to this RFP document that it has not
relied on any idea, information, statement, representation, or warranty given in this RFP
document.
• The objective of the evaluation process is to evaluate the bids to select an effective solution
at a competitive price.
• Through this Request for Proposal, Bank aims to select a Bidder/ application provider who
would undertake the designing and implementation of the required solution. The Bidder
shall be entrusted with end‐to‐end responsibility for the execution of the project under the
scope of this RFP. The Bidder is expected to commit for the delivery of services with
performance levels set out in this RFP with a Service Level Agreement.
• The Bank has adopted a two bid process in which the Bidder has to submit (1) Technical Bid
and (2) Commercial Bids separately but at a time as stipulated.
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• The Bank shall evaluate the Technical Bids initially and based on Technical Bid evaluation
shall undertake evaluation of the Commercial bid of the technically qualified proposals only.
This will be followed by a techno‐commercial process for the technically qualified bidders.
• Bank will be evaluating the bids and its decision on selecting the bidder will be final.
4.1 Normalization of bids
The Bank will go through a process of technical evaluation and normalization of the bids to the
extent possible and feasible to ensure that Bidders are more or less on the same technical
ground. After the normalization process, if the Bank feels that any of the bids needs to be
normalized and that such normalization has a bearing on the commercial bid; the Bank may at
its discretion ask all the technically short‐listed Bidders to resubmit the technical and
commercial bids once again for scrutiny. The Bank can repeat this normalization process at
every stage of technical submission or till the Bank is satisfied. The Bidders agree that they have
no reservation or objection to the normalization process and all the technically short listed
Bidders will, by responding to this RFP, agree to participate in the normalization process and
extend their co‐operation to the Bank during this process. The Bidders, by submitting the
response to this RFP, agree to the process and conditions of the normalization process.
4.2 Opening of Bids by the Bank
4.2.1 Opening of Eligibility Criteria & Technical Bids
1. The Bank will open the Eligibility Criteria & Technical bid in the presence of Bidders’
representatives who choose to attend.
2. In case the bid opening date is declared a Bank holiday in Bangalore, the bids shall be
opened at the same time on the next working day.
3. Those Bidders satisfying the eligibility criteria and accepting the terms and conditions of
this document shall be short‐listed for further evaluation.
4. The Bank will examine the bids to determine whether they are complete, whether
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required information has been provided as stated in the bid document, whether the
documents have been properly signed, and whether bids are generally in order.
5. The evaluation shall include fulfillment of functionality requirements as given in the RFP.
Any bid determined as not in order as per the specifications will be rejected by the Bank.
6. Any effort by Bidder to influence the Bank in the Bank’s bid evaluation, bid comparison
or contract award decision may result in the rejection of the Bidders’ bid. Bank’s decision
will be final and without prejudice and will be binding on all Bidders.
7. The Bank reserves the right to accept or reject any bid and annul the bidding process and
reject all bids at any time prior to award of contract, without thereby incurring any
liability to the affected Bidder or Bidders or any obligation to inform the affected Bidder
or Bidders of the ground for the Bank’s action.
8. To assist in the examination, evaluation and comparison of bids the Bank plans to, at its
discretion, ask the Bidders for clarification and response shall be in writing and no
change in the price or substance of the bid shall be sought, offered or permitted.
9. Technically short listed Bidders shall be invited for a presentation of the solution at a
date, time and venue to be conveyed separately. Final short listing for opening
commercial bids shall be done based on the solution demonstration and the ability of the
proposed solution to meet the functional requirements.
4.2.2 Opening of Commercial Bids
1. Technically qualified bidders will be informed about the date and time of opening of
commercial bid and they will be invited to participate in the opening of the bid. The
Commercial Bid (Part II) will be opened by the Bank notwithstanding the presence of the
bidders.
2. The Bidders’ names and bid prices will be recorded at the bid opening.
3. Commercial bids of technically non‐responsive Bidders shall be returned un‐opened.
CANARA BANK
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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4.2.3 Determination of Successful Bidder and Awarding of Contract
On Completion of evaluation process of Technical Bid and Commercial Bid, Bank will carry out a
techno‐commercial evaluation of the bid as per business rules given in Sub Section 4.8 and
terms & conditions mentioned under Evaluation Criteria and the contract will be awarded to the
bidder having the highest Final Evaluation Score (FES) which is an outcome of Techno‐
Commercial Evaluation process.
Bidders are advised to refer to Section 4.4: Evaluation Criteria for details and methodology of
Evaluation Criteria
4.3 Eligibility Criteria
Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
1. The Bidder (SI) must have a presence in
India for at least 3 years and should
have average revenues in excess of INR
100 Cr. For the past 3 financial years
i.e.2009‐10, 2010‐11& 2011‐12.
Provide provisional figure for 2012-13
Copies of Annual Reports in
case of listed companies and
Copies of audited balance
sheets and P&L statements in
case of others for past 3
financial years.
For 2012-13 provisional
certificates from auditors are
to be provided.
2. The proposed OEM/s must have a
presence in India for at least last 3 years
and should have Indian revenues in
excess of `10 Crores for the past 2
financial years i.e. 2010‐11& 2011‐12
Each of the OEMs should have an office
in India with support of adequate staff.
Copies Annual Report (in case
of listed companies) and
Latest audited financial
statements for others
Certificate of Incorporation,
Certification of
commencement of business.
Self-declaration containing
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
the staff strength of the firm.
3. The Bidder (SI) and OEM should have
made Net Profit After Tax during the last
three financial years
Copies of Annual Reports (in
case of listed companies) and
copies of audited balance
sheets and P&L statements in
case of others.
4. The Bidder (SI) should own the
intellectual property rights of the
product / solution or he should have
rights from the owner If not, the Bidder
(SI) should have in place proper tie‐ups/
commercial agreements/ authorized
implementation partnership for
deployment/ resale/ customization of
software with the OEM whose software
products are offered.
Letter from OEM authorizing
the bidder to use the solution
and sign the contract for this
solution
5. The Bidder (SI) and OEMs should not
have been blacklisted at the time of
submission by the Central/any of the
State Governments/ statutory body/
regulatory body/Indian Banks
Association in India and globally.
Self-Declaration/s
6. The Bidder (SI) should be registered
company in India with an established set
up with support of adequate staff and
an office in Bangalore, India
Certificate of Incorporation,
Certification of
commencement of business
Self-declaration of offices in
India
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
7. The Bidder (SI) / OEM having at least
one of the following Accreditations
ISO9001:2000, CMMI 5
Relevant and Valid
Certificates to be provided
(copies)
9. Disclosure of Conflict of Interest by
bidder/ OEM
Self-Declaration/s
10. Credit Risk - The Bidder (SI) should have
implemented/implementing a Credit
Risk Solution for Basel II Compliance
under FIRB and AIRB in 1 public sector
bank/private bank in India/globally. In
case of global implementations, the
implementation should be in
jurisdictions where IRB has been
adopted by the regulator.
Implementations in Co‐operative
banks (State Co‐operative banks,
District Central co‐operative banks,
Urban Co‐operative banks, etc.), credit
unions and housing building societies
shall not be considered for evaluation
Copies of credential letters
from bank(s) containing scope
of work, timelines and OEM
partners for the project
Case studies of
implementation where
available
11. Credit Risk – Loan Origination System
The Bidder (SI)/OEM should have
implemented/implementing a Loan
Origination System in at least 1 public
sector bank/private bank/financial
institution in India/globally.
Implementations in Co‐operative
banks (State Co‐operative banks,
District Central co‐operative banks,
Urban Co‐operative banks, etc.), credit
Copies of credential letters
from bank(s) containing scope
of work, timelines and OEM
partners for the project
Case studies of
implementation where
available
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
unions and housing building societies
shall not be considered for evaluation
12. Operational Risk - The Bidder (SI) should
have implemented/implementing an
Operational Risk Solution for Basel II
Compliance under The Standardized
Approach and Advanced Measurement
Approach in 1 public sector
bank/private bank in India/globally. In
case of global implementation, the
implementation should be in a
jurisdiction where AMA has been
adopted by the regulator.
Implementations in Co‐operative
banks (State Co‐operative banks,
District Central co‐operative banks,
Urban Co‐operative banks, etc.), credit
unions and housing building societies
shall not be considered for evaluation
Copies of credential letters
from bank(s) containing scope
of work, timelines and OEM
partners for the project
Case studies of
implementation where
available
13. Market Risk - The Bidder (SI) should
have implemented/implementing a
Market Risk Solution for Basel II
Compliance under Internal Models
Approach in 1 public sector
bank/private bank in India/globally. In
case of global implementations, the
implementation should be in
jurisdictions where IMA has been
adopted by the regulator.
Implementations in Co‐operative
banks (State Co‐operative banks,
Copies of credential letters
from bank(s) containing scope
of work, timelines and OEM
partners for the project
Case studies of
implementation where
available
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
District Central co‐operative banks,
Urban Co‐operative banks, etc.), credit
unions and housing building societies
shall not be considered for evaluation
14. Asset Liability Management and Fund
Transfer Pricing – The bidder (SI) should
have implemented/implementing an
asset liability management solution in 1
public sector bank/ private bank in
India/globally.
In case of global implementations, the
implementation should be in
jurisdictions where ALM guidelines have
been prescribed by the concerned
regulator.
Implementations in Co‐operative
banks (State Co‐operative banks,
District Central co‐operative banks,
Urban Co‐operative banks, etc.), credit
unions and housing building societies
shall not be considered for evaluation
Copies of the credential
Letter from the Bank(s)
containing scope of work,
timelines and OEM partners
for the project
Case studies of
implementation where
available
15. Integrated Capital Computation and
Reporting Module –
The bidder (SI)/ OEM should have
implemented/implementing an
integrated capital computation module
in in at least 1 public sector
bank/private bank in India/globally.
Implementations in Co‐operative
banks (State Co‐operative banks,
District Central co‐operative banks,
Copies of Credential Letters
containing scope of work,
timelines and OEM partners
for the project
Case studies of
implementation where
available
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr.
No.
Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
Urban Co‐operative banks, etc.), credit
unions and housing building societies
shall not be considered for evaluation
4.4 Evaluation Criteria
4.4.1 Preliminary RFP Examination
The Bank will scrutinize the offers to determine whether they are complete, whether any errors
have been made in the offer, whether required technical documentation has been furnished,
whether the documents have been properly signed, and whether items are quoted as per the
schedule.
During the process of scrutiny, evaluation and comparison of offers, the Bank may, at its
discretion, seek clarifications from all the bidders/any of the bidders on the offer made by them.
The bidder has to respond to the bank and submit the relevant proof /supporting documents
required against clarifications, if applicable. The request for such clarifications and the Bidders
response will necessarily be in writing and it should be submitted within the time frame
stipulated by the Bank.
The Bank may, at its discretion, waive any minor non-conformity or any minor irregularity in an
offer. This shall be binding on all Bidders and the Bank reserves the right for such waivers and
the Bank’s decision in the matter will be final.
4.4.2 Technical Bid Evaluation Criteria
The proposal submitted by the Bidders shall be evaluated on technical grounds covering various
components of the projects as follows:
1. Functional requirements: The minimum functional specifications for the CRMS, ORMS,
MRMS and Integrated Capital Computation and Reporting Module are given in Section 6,
Section 7, Section 8 and Section 9 on Functional Requirements. All the requirements are
mandatory.
The total marks obtained against the total number of functional specifications will be a
maximum of 350 for evaluation in line with tables in Section 4.5 for each risk solution.
CANARA BANK
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RFP for Solution to Implement
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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The response to the functional requirements are to be furnished in the formats specified in
annexure no. 11.4 – Technical Bid Format
2. Technical Requirements: The minimum technical specifications for the CRMS, LOS, ORMS
MRMS, ALMS and Integrated Capital Computation and Reporting Module software are given
in Section 10 – Technical Requirements. All the requirements are mandatory.
The total marks obtained against the total number of technical specifications will be a
maximum of 100 for evaluation in line with tables in Section 4.5
The Response to functional and technical requirements should be as per the table below
Scale Description
S Standard feature: Required features readily available and to be provided by
the Bidder
A Alternative available: Bidder will suggest & provide the alternative
approach which should be convincing to the Bank. Alternative approach
may not be acceptable to the bank if it is not as per risk management
framework of bank. Bank will be the sole decision make in this respect.
C Customization required: Bidder will provide the customization within the
stipulated date as informed by Bank
U Unavailable; Functionality is not available and will not be provided by the
Bidder.
Response except ’S’/’A’/’C’/’U’ are not acceptable and will be treated as ‘Unavailable’
Each line item in the functional and technical requirement mentioned carry weights as
below, as per the response provided by the bidder.
Scale Weights
S-Standard feature 10
A-Alternative available 7
C-Customization required 5
U–Unavailable 0
4.4.3. Product Demonstration & Bid Presentation:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 65 of 250
Eligible Bidders are required to make presentations to supplement their bids and show a
detailed product demonstration. The Bank will schedule presentations and the time and location
will be communicated to the Bidders. Failure of a Bidder to complete a scheduled presentation
to the Bank may result in rejection of the proposal.
The total marks obtained against product demonstration will be a maximum of 80 for evaluation
in line with the respective tables.
Technical score will be finalized based on both ‐ scores given to the Bidder as per functional
requirements product demonstration and presentation.
4.4.4. Past Experience:
The Bidder should provide details of past experience in implementing CRMS, LOS, ORMS, MRMS,
ALMS and Integrated Capital Computation and Reporting Module
a. The Bidder’s past experience shall be evaluated and the score obtained by the Bidder shall be
considered for evaluation as given in Annexure 11.10: Past Experience Details
b. The Bidder should provide the details of all the implementations in Banks including details of
Scope of Project, Number of Branches with breakup of the role, Proof of Implementation and
approval by the Regulatory Authority.
c. Experience at co‐operative banks (State Co‐operative banks, District Central co‐operative
banks, Urban Co‐operative banks, etc.) shall not be considered for evaluation.
4.4.5. Approach and Methodology
a. Reference site visit/ Call/ Email Confirmations: Executives from the Bank would carry out
Reference Site Visits and/or solicited email with the existing customers of the Bidder. The
inputs that have been received from the Customer would be considered by the Bank and
this might not need any documentary evidence. This rating would be purely on the inputs
(like satisfaction of the organization of the product, timeliness of implementation,
promptness of support services etc.) provided by the Bidder’s customers and score would be
assigned to Bidder as mentioned in Annexure 11.8: Reference Site Details.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 66 of 250
The Bank at its discretion may reject the proposal of the Bidder without giving any reasons
whatsoever, in case the responses received from the Site Visits are negative.
b. Team Strength:
i. Bidder responses to each point under Team Strength in Annexure 11.13:
Implementation Team Profile, including the team profile provided by the Bidder, would
be evaluated.
ii. The Bidder should ensure that the people above the role of the Team Lead who are
proposed for this project should have worked on projects in Indian Banks earlier.
c. Project Management
i. Bidders are required to respond to each point under Project Management set out for
CRMS, ORMS, MRMS, LOS, ALMS and Integrated Capital Computation and reporting
Module and each question will be evaluated for suitability of response.
ii. The Bidder should provide explanation on the Project Management process in the
formats prescribed within the Annexure 11.4 Technical Bid Format that is proposed for
the Bank including details of how the same was applied in a similar project.
d. Training:
i. The Bidder will be responsible for training the Bank’s employees in the areas of
implementation, operations, management, error handling, system administration, etc.
with respect to the implementation of EWIRM Solution.
ii. The training should be imparted in two ways – one for handling the solution and the
other for day to day users.
iii. The training will include functional as well as technical training to the implementation
group of the bank which is responsible for project oversight as decided by bank.
iv. The end user training should be also included in the scope. The end user must be trained
on all functionalities required for efficient daily operations of the EWIRM Solution.
v. The quality of the Bidder’s training program shall form an integral part of the final
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 67 of 250
evaluation and selection of the Bidder.
vi. The training requirements are set out for CRMS, ORMS, MRMS, LOS, ALMS and
Integrated Capital Computation and reporting Module. The questions pertain to the
training techniques, course details provided by the Bidder and the educational
qualifications and experience of the trainers.
vii. The bidder has to furnish responses to the training requirements in the format
prescribed in Annexure 11.4 Technical Bid Format.
4.5 Functional & Technical Evaluation Criteria
4.5.1. For Credit Risk Management Solution under IRB
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Functional Requirements Evaluation 350
2 Technical Requirements Evaluation 100
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
3 Past Experience 300
3.1 Proposed solution is implemented/ under implementation (FIRB
and AIRB) in a Bank of comparable size/complexity of operations
as that of Canara Bank in a jurisdiction where FIRB and AIRB
Approach is adopted by the regulator (Outside India)
1 Bank 40
2 Banks 80
More than 2 banks 100
3.2 Proposed solution has been implemented under Standardized
Approach in Banks in India of comparable size/complexity of
operations as that of Canara Bank
1 Bank 5
2 Banks 10
More than 2 Banks 20
3.3 Proposed Solution is under implementation of FIRB and AIRB in
Banks in India of comparable size/complexity of operations as
that of Canara Bank
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 68 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Bank 80
2 Banks 100
More than 2 Banks 120
3.4 Proposed solution has been implemented/ under
implementation for advanced approaches by the bidder and the
OEM together in a bank in India and globally
1 Bank 30
2 Banks 40
More than 2 Banks 60
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
90
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
6 The proposed software must be positioned as “Leaders” (top 5)
in Gartner/Forrester/Chartis/Celent or any other globally
recognized body report in the last 2 years
10
Rank 1 to 2 10
Rank 3 to 4 7
Rank 5 5
TOTAL 1000
4.5.2. For Loan Origination System
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Functional Requirements evaluation
350
2 Technical Requirements Evaluation
100
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 69 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
3 Past Experience 300
3.1 Proposed solution is implemented in 1 Bank/FI abroad
1 Bank/FI 30
2 Banks/FI 50
More than 2 Banks/FI 80
3.2 Proposed Solution is implemented in 1 Bank/FI in India
1 Bank/FI 80
2 Banks/FI 100
More than 2 Banks/FI 120
3.3
Proposed solution has been implemented/ under
implementation for advanced approaches by the bidder and the
OEM together in a bank in India and globally
1 Bank 50
2 Banks 80
More than 2 Banks 100
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
100
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
TOTAL 1000
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 70 of 250
4.5.3. For Operational Risk Management Solution
Sr.
No.
Technical & Functional Evaluation Phase Sub
Scores
Max Total
Score
1 Functional Requirements Evaluation 350
2 Technical Requirements Evaluation 100
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
3 Past Experience 300
3.1 Proposed solution is implemented/ under implementation (AMA)
in a Bank of comparable size/complexity of operations as that of
Canara Bank in a jurisdiction where AMA is adopted by the
regulator (Outside India).
1 Bank 40
2 Banks 80
More than 2 Banks 100
3.2 Offered solution has been implemented under The Standardized
Approach (TSA) in Banks in India /Globally of comparable
size/complexity of operations as that of Canara Bank
1 Bank 5
2 Banks 10
More than 2 Banks 20
3.3 Offered Solution is under implementation of AMA in Banks in India
of comparable size/complexity of operations as that of Canara
Bank
1 Bank 80
2 Banks 100
More than 2 Banks 120
3.4
Proposed solution has been implemented/ under implementation
for advanced approaches by the bidder and the OEM together in a
bank in India and globally
1 Bank 30
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 71 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub
Scores
Max Total
Score
2 Banks 40
More than 2 Banks 60
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
90
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
6 The proposed software must be positioned as “Leaders” (top 5) in
Gartner/Forrester/Chartis/Celent or any other globally recognized
body report in the last 2 years
10
Rank 1 to 2 10
Rank 3 to 4 7
Rank 5 5
TOTAL 1000
4.5.4. For Market Risk Management Solution
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Functional Requirements evaluation 350
2 Technical Requirements Evaluation 100
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
4 Past Experience 300
3.1 Proposed solution is implemented/under implementation (IMA)
in a Bank in a Bank of comparable size/complexity of operations
as that of Canara Bank in a jurisdiction where IMA is adopted by
the regulator (Outside India).
1 Bank 40
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 72 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
2 Banks 80
More than 2 Banks 100
3.2 Proposed solution has implemented under the Standard
Measurement Methodology in Banks in India of comparable
size/complexity of operations as that of Canara Bank
1 Bank 5
2 Banks 10
More than 2 Banks 20
3.3 Proposed Solution is under implementation of IMA in Banks India
of comparable size/complexity of operations as that of Canara
Bank
1 Bank 80
2 Banks 100
More than 2 Banks 120
3.4 Proposed solution has been implemented/ under
implementation for advanced approaches by the bidder and the
OEM together in a bank in India and globally
1 Bank 30
2 Banks 40
More than 2 Banks 60
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
90
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
6 The proposed software must be positioned as “Leaders” (top 5)
in Gartner/Forrester/Chartis/Celent or any other globally
recognized body report in the last 2 years
10
Rank 1 to 2 10
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 73 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
Rank 3 to 4 7
Rank 5 5
TOTAL 1000
4.5.5. For Asset Liability Management Solution
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Functional Requirements evaluation 350
2 Technical Requirements Evaluation 100
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
3 Past Experience 300
3.1 Proposed solution is implemented/under implementation in a
Bank of comparable size/complexity of operations as that of
Canara Bank in a jurisdiction where the regulator has prescribed
ALM guidelines (Outside India).
1 Bank 30
2 Banks 50
More than 2 Banks 80
3.2 Proposed Solution is under implementation in a Bank in India of
comparable size/complexity of operations as that of Canara Bank
with current RBI guidelines
1 Bank 40
2 Banks 80
More than 2 Banks 100
3.3
Proposed solution has been implemented/ under
implementation by the bidder and the OEM together in a bank in
India and globally
1 Bank 50
2 Banks 90
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 74 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
More than 2 Banks 120
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
90
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
6 The proposed software must be positioned as “Leaders” (top 5)
in Gartner/Forrester/Chartis/Celent or any other globally
recognized body report in the last 2 years
10
Rank 1 to 2 10
Rank 3 to 4 7
Rank 5 5
TOTAL 1000
4.5.6. For Integrated Capital Computation and Reporting Module
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
1 Functional Requirements evaluation 350
2 Technical Requirements Evaluation 100
2.1 Technical Solution Evaluation 60
2.2 Proposed Hardware & Infrastructure Configuration Evaluation 40
3 Past Experience 300
3.1 Proposed solution is Implemented/under implementation in 1
Bank abroad of comparable size/complexity of operations as that
of Canara Bank
1 Bank 30
2 Banks 50
More than 2 Banks 80
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 75 of 250
Sr.
No.
Technical & Functional Evaluation Phase Sub Scores Max Total
Score
3.2 Offered Solution is Implemented in 1 Bank in India of
comparable size/complexity of operations as that of Canara Bank
1 Bank 40
2 Banks 80
More than 2 Banks 100
3.3
Proposed solution has been implemented/ under
implementation by the bidder and the OEM together in a bank in
India and globally
1 Bank 50
2 Banks 90
More than 2 Banks 120
4 Product Demonstration – detailed product demonstration as per
the functionality requirement mentioned in the RFP
90
5 Approach & Methodology 150
5.1 Reference site visit/call/email 50
5.2 Team Strength 60
5.3 Project Management 20
5.4 Training 20
6 The proposed software must be positioned as “Leaders” (top 5)
in Gartner/Forrester/Chartis/Celent or any other globally
recognized body report in the last 2 years
10
Rank 1 to 2 10
Rank 3 to 4 7
Rank 5 5
TOTAL 1000
4.6. Short listing of Technically Qualified Bidders
Technically qualified Bidders will be shortlisted based on the following criteria:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 76 of 250
Bidders (RTS) scoring 75% or above in all the Credit Risk Management, Operational Risk
Management, Market Risk Management and Integrated Capital Computation and Reporting
Module individually in the technical evaluation will be short‐listed for commercial evaluation.
However, in case there are less than 3 Bidders who score 75% or above, the Bank may, at its
discretion, choose the top 3 scoring Bidders subject to the bidder scoring 65%.
The technical score Tx = Score from Technical Evaluation for Credit Risk + Score from Technical
Evaluation LOS + Score from Technical Evaluation for Operational Risk + Score from Technical
Evaluation for Market Risk + Score from Technical Evaluation for ALM + Score from Technical
Evaluation Integrated Capital & Reporting Module (The score will be out of 6000)
The Relative Technical Score (RTS) for the Bidders will be calculated based on the following
basis:
RTSx = Tx/ T1 *100
Where,
RTSx: Relative Technical Score of each Bidder
Tx: Technical Score of bidder X
T1: Technical Score of the Bidder with Highest Technical Score
Up to 4 decimal values will be considered for the score.
Example: If Bidder A scores 5500 points and has the highest technical score, thenT1 = 5500
If Bidder B scores 5000 points, then Bidder B is TB = 5000
Hence,
RTSA = 5500/5500*100 = 100.0000
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 77 of 250
RTSB = 5000/5500*100 = 90.9090
4.7. Commercial Evaluation Process
The technically qualified bidder will participate in the Commercial Evaluation process
The price quoted by the bidder in the Commercial Bid Format would be considered for the
commercial evaluation process.
The Relative Commercial Score (RCS) for each shortlisted Consultant will be calculated as given
below:
RCS = L1 / L * 100
Where,
RCS: Relative Commercial Score
L: Amount quoted by the current proposal
L1: Lowest Amount quoted by lowest quoted (L1) proposal
4.8. Techno – Commercial Evaluation Criteria
The final selection of a Bidder will be based on the outcome of the combined Technical &
Commercial Evaluation process for the qualified bidders in the Technical Bid round. For
finalization of the most competitive offer, the Bank will calculate Relative Commercial Score
(RCS) and assign 30% weightage to this score in the final evaluation. The Relative Technical Score
(RTS) will be assigned 70% weightage.
The Final Evaluation of Score (FES) will be as below:
FES = 0.70 * RTSX + 0.30 * RCSX
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 78 of 250
Where:
FESX = Final Evaluation Score of Vendor X
RTSX = Relative Technical Score of Vendor X
RCSX = Relative Commercial Score of Vendor X
The Bidder securing the highest FES would be the successful bidder. The Bidder whose technical
& commercial Bid is accepted will be referred to as “Successful Bidder” and the Bank will notify
the same to the Successful Bidder.
Bank reserves the right to select the next ranked Bidder if the selected Bidder withdraws his
proposal after selection or at the time of finalization of the contract or disqualified on detection
of wrong or misleading information in the proposal.
In case of a Tie between two or more Bidders for Final Evaluation Score (FES), the Bid with
higher Relative Technical Score would be chosen at the discretion of the Bank.
The Highest Technical bidder shall not automatically qualify for becoming selected bidder and
for award of contract by the bank.
The Lowest Commercial Bidder shall not automatically qualify for becoming selected Bidder and
for award of contract by the Bank.
The Bank shall not incur any liability to the affected Bidder on account of such rejection.
The final decision on the vendor will be taken by Canara Bank. The implementation of the
project will commence upon successful negotiation of a contract between Canara Bank and the
successful bidder based on the Techno – Commercial evaluation.
4.9. Disqualification Parameters in Technical Bid Evaluation
The Bank at its discretion may reject the proposal of the Bidder without giving any reason
whatsoever, if in the Bank’s opinion, the Solution does not meet the functional requirements
and other performance criteria as stipulated by the Bank.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 79 of 250
The Bank at its discretion may reject the proposal of the Bidder without giving any reasons
whatsoever, in case the responses received from the Site Visits are negative.
5. Other Terms & Conditions
5.1 Indemnity
The Bidder agrees to indemnify and keep indemnified the Bank against all losses, damages,
costs, charges and expenses incurred or suffered by the PURCHASER due to or on account of any
claim for infringement of copy right or any such right of any other person in the services or any
material or software provided by the Bidder.
The Bidder agrees to indemnify and keep indemnified the Bank against all losses, damages,
costs, charges and expenses incurred or suffered by the Bank due to or on account of any
breach of the terms and conditions contained in this agreement.
The Bidder agrees to indemnify and keep indemnified Bank at all times against all claims,
demands, actions, costs, expenses (including legal expenses), loss or reputation and suits which
may arise or be brought against the purchaser, by third parties on account of negligence or
failure to fulfill obligations by contractor.
All indemnities shall survive notwithstanding expiry or termination of Contract and Bidder shall
continue to be liable under the indemnities.
5.2 Liquidated Damages
5.2.1 Liquidated Damages for delay:
In case of delayed supply or implementation, the supplier shall be liable to pay as Liquidated
damages at the rates specified below, for each completed week of delay or part thereof, on the
purchase order value of the EWIRM Solution.
Liquidate Damages rate per week or
part thereof
Delay Period
1% of the contract price with a
maximum cap of 10%
For each week of delay
The bank may however extend the time of completion under Force Majeure conditions.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 80 of 250
5.2.2 Liquidated damages for non-performance:
If the specifications of the RFP are not met by the Bidder during various tests, the Bidder shall
immediately rectify or replace the same to comply with the specifications as defined in the RFP
and within the committed response time, failing which the Bank has the sole right either to
reject or to accept it finally by recovering the suitable amount as deemed reasonable by the
Bank out of the payments due to the vendor or even by invocation of Performance Guarantee.
Both the above clauses are independent of each other and are applicable separately and
concurrently.
The bidder agrees and considers that the liquidated damages set out herein above are fair and
reasonable and that he will raise no objection or dispute with regard to the bank’s right to
recover the liquidated damages.
The liquidated damages shall be deducted / recovered by the bank from any money due or
becoming due to the bidder under this purchase contract or may be recovered by encashment
of bank guarantees or otherwise from supplier.
5.3 Penalty
The Bidder shall perform its obligations under the agreement entered into with The Bank, in a
professional manner.
If any act or failure by the Bidder under the agreement results in failure or inoperability of
systems and if The Bank has to take corrective actions to ensure functionality of its property,
The Bank reserves the right to impose penalty, which may be equal to the cost it incurs or the
loss it suffers for such failures.
The Bank plans to impose penalty to the extent of damage to its any equipment, if the damage
was due to the actions directly attributable to the staff of Bidder.
The Bank shall implement all penalty clauses after giving due notice to the Bidder.
If the Bidder fails to complete the due performance of the contract in accordance with the
specification and conditions of the offer document, The Bank reserves the right either to cancel
the order or to recover a suitable amount as deemed reasonable as Penalty / Liquidated
Damage for non-performance.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 81 of 250
Failure to maintain uptime SLA will attract penalty as given in Section 3.1.8: Service Level
Agreement
Failure to meet the required timelines/deadlines for various milestones for implementation
would attract penalty as given in Section 5.2: Liquidated Damages.
5.4 Insurance
The equipment (hardware, software etc.) supplied under the contract shall be fully insured by
the successful Bidder against loss or damage incidental to manufacture or acquisition,
transportation, storage, delivery and installation. The insurance shall be obtained by the Bidder
naming Canara Bank as the beneficiary, for an amount Equal to 100% of the invoiced value of
the goods on “all risks" basis. The period of insurance shall be up to the date the supplies are
accepted and the rights of the property are transferred to The Bank. The successful bidder shall
ensure that the insurance policy is in force and make necessary arrangement for renewal of the
policy whenever required.
Should any loss or damage occur, the selected Bidder shall: ‐
i. initiate and pursue claim till settlement and
ii. Promptly make arrangements for repair and / or replacement of any damaged item
irrespective of settlement of claim by the underwriters.
5.5 Inspection & Tests
Bank shall have the right to inspect and / or test the goods to check their conformity to the
contract specifications at no extra cost to the purchaser.
The inspection and test may be done on the premises of the supplier or at the point of delivery.
5.6 Warranty
The offer must include comprehensive on‐site warranty of 1 year from the date of go live of
Enterprise Wide Integrated Risk Management system. Bidder must provide warranty for all
equipment, accessories etc.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 82 of 250
5.7 Delivery of servers – period
The goods are to be delivered within six weeks from the date of signing of contract.
5.8 AMC price Validity
The prices finalized shall remain valid for six months from the date of purchase order. However,
AMC price will remain valid for 5 years post warranty period.
5.9 Dispute Resolution
If a dispute, controversy or claim arises out of or relates to the contract, or breach, termination
or invalidity thereof, and if such dispute, controversy or claim cannot be settled and resolved by
the Parties through discussion and negotiation, then the Parties shall refer such dispute to
arbitration.
Both Parties may agree upon a single arbitrator or each Party shall appoint one arbitrator and
the two appointed arbitrators shall thereupon appoint a third arbitrator.
The arbitration shall be conducted in English and a written order shall be prepared.
The venue of such arbitration shall be at Bangalore. The arbitration shall be held in accordance
with the Arbitration and Conciliation Act, 1996. The decision of the arbitrator shall be final and
binding upon the Parties, provided that each Party shall at all times be entitled to obtain
equitable, injunctive or similar relief from any court having jurisdiction in order to protect its
intellectual property and confidential information.
5.10 Project Documentation and Manuals
All works related to the assignment handled are to be well documented and will form the part
of deliverables.
They should be delivered both in hard copy and soft copy at the end of the each stage.
5.11 Right to reject bids
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 83 of 250
The Bank reserves the absolute and unconditional right to reject the bid if it is not in accordance
with RFP terms and conditions and no correspondence shall be entertained by the Bank in the
matter. The bid is liable to be rejected if:
• It is not in conformity with the instructions mentioned in the RFP document including its
annexures.
• It is not accompanied by the requisite bid document price & EMD.
• It is not properly/duly signed.
• It is received through any mode other than the prescribed mode.
• It is received after expiry of the due date and time.
• It is incomplete including non-furnishing the required documents.
• It is evasive or contains incorrect information.
• There is canvassing/ lobbying/influence/query regarding short listing, status etc. of any kind.
5.12 Change Orders
The Bank may, at any time, by a written order given to the successful bidder, make changes
within the general scope of the Contract in Technical and functional specifications. If any such
change causes an increase or decrease in the cost of, or the time required for the successful
bidder’s performance of any provisions under the Contract, an equitable adjustment shall be
made in the Contract Price or delivery schedule, or both, and the Contract shall accordingly be
amended. Any claims by the successful bidder for adjustment under this clause should be
asserted within thirty (30) days from the date of successful bidder’s receipt of Bank’s change
order.
5.13 Substitution of Project Team Members
During the project, the substitution of project team including project manager identified for the
assignment will not be allowed unless such substitution becomes unavoidable to overcome the
undue delay or that such changes are critical to meet the obligation. In such circumstances, the
Bidder, as the case may be, can do so only with the prior written concurrence of the Bank and
by providing the replacement staff of the same level of qualifications and competence. If the
Bank is not satisfied with the substitution, the Bank reserves the right to terminate the contract
and recover whatever payments(including past payments and payment made in advance) made
by the Bank to the Bidder during the course of the assignment pursuant to this RFP besides
claiming an amount equal to the contract value as liquidated damages. However, the Bank
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
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RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 84 of 250
reserves the unconditional right to insist the Bidder to replace any team member with another
(with the qualifications and competence as required by the Bank) during the course of
assignment pursuant to this RFP.
6. Functional Requirements for Credit Risk
The Bank aims to migrate to the Internal Ratings based Approaches (IRB) for Credit risk as per
Basel II, Basel III and RBI guidelines. The solution should support estimation of all risk
components and capital calculations (regulatory & economic) as per the guidelines issued by RBI
and Basel under the Standardized and IRB approaches. The solution should be able to meet the
Pillar I, II, III and stress testing requirements as per Basel‐II / RBI guidelines and Basel‐III
guidelines. The solution should be capable of supporting all the required statistical, analytical,
risk modeling, pricing and reporting requirements.
6.1 Functional Requirements
6.1.1 Functional Requirements for Credit Risk under IRB
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format in sub section 11.4.1.
Sr. No. Credit Risk Functional Requirements
1.0 Analytics – Solution for Model Development and Validation
The solution should provide a statistical package / tool for credit risk model
development and model validation. The solution should support the following key
features:
1.1
Data Management Capability:
Support access of data via multiple data sources, databases and support diverse file
types. Access and integrate structured and unstructured data sources.
Ability to read data in any format, from any kind of file, including variable-length
records, binary files, free-formatted data and even files with messy or missing data.
The solution should have capability to import text files (delimited and fixed width),
Excels, MS Access and other standard data format. Support Structured Query
Language (SQL).
Support export of data in multiple formats for use or update into different tools and
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 85 of 250
Sr. No. Credit Risk Functional Requirements
system – delimited text files, Excel, MS Access, XML, SAS, SPSS Statistics, etc. Exports
results to other applications such as Adobe Acrobat, Microsoft Excel, HTML or
Microsoft Word.
Support implementation of process that continuously and/or on demand provides
up-to-date de-normalized tables with customer data from multiple sources. Support
automatic update of analyses as per the schedule. Enable automatic data preparation
in a single set
Support consolidation of customer and account information from a multitude of
systems and tables
Enable filtering, labeling, derivation of variables, binning, ranking, field reordering of
fields
Create and maintain historical tables on customer and account which can be used
any time for model development, model validation, model monitoring
Enable outlier filtering, data sampling, data partitioning, merge and append, sorting,
Univariate statistics, Bivariate statistics, segment analysis, data quality check and
report, interactively linked plots, missing data imputation etc.
Enables string functions like string creation, substitution, search, whitespace removal
and truncation
Should include interactive Graph Builder which enables to drag and drop variables.
The tool should be able to generate various types of graphs including but not limited
to area chart, bar chart, box plot, bubble plot, line plot, map graph, pie chart, radar
chart, scatter plot, surface plot and contour plot.
Have Interactive variable binning.
Transparently document, create logs of all data creation, transformation and analysis
Enable impact analysis and reverse impact analysis, i.e. is the user should be able to
verify which source fields were used to create a derived field, and which fields are
impacted by changes in fields downstream
The solution should enable relevant user(s) to configure sources of data for model
development and validation.
the solution should address various country/language specific data quality concerns
the system should
o connect to various data sources natively and via ODBC
o identify redundant data analysis
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 86 of 250
Sr. No. Credit Risk Functional Requirements
o ensure data standardization
o capable of ensuring uniform data value representation
o correct mistakes in spellings, inconsistencies, casings and abbreviations
the system should be
o available for batch mode data quality implementation
o available for real time (online) mode data quality implementation
o extendable to enterprise wide data integration capabilities
o extendable and/integrated to querying & reporting modules across enterprise
o extendable and/integrated to analytical solutions across enterprise
o extendable and/integrated to vertical solutions across enterprise
the solution should
o Be interoperable
o natively read and write data from RDBMS
o natively read and write data from Mainframes & ERP
o have scheduling capabilities
o have data transformation capabilities
o have data synchronization and data federation capabilities
The tool should support Sampling for model development and validation
The tool should support sample using Random, Systematic and Stratified sampling
Criteria and data used for sampling process should be saved
Every sample modification should carry an audit trail
Option to exclude specific items from the sample should be available along with audit
trail
The tool should be able to perform a test on the representativeness of a sample
against the total database
The sampling technique used in the tool should automatically provide a set of
samples for comparison
The solution should enable relevant user(s) to configure sampling criteria. For
example, the user should be able to specify the portfolio, product, time period etc.
for the sampling data.
The solution should be able to retrieve data on demand as per the sampling criteria
defined.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 87 of 250
Sr. No. Credit Risk Functional Requirements
1.2
Analytical Capability – model development and validation:
The tool should provide a methodology for development of models using Analysis of
variance, Mixed models, Regression, Categorical data analysis, Bayesian analysis,
Multivariate analysis, Survival analysis, Psychometric analysis, Cluster analysis,
Nonparametric analysis, Survey data analysis, Multiple imputation for missing values
System should
o help in structure discoveries
o enable frequency distribution
o enable pattern distribution
o help in data discoveries
o provide metadata validations and statistics
o identify data scarcity
o identify outliers and percentiles
o allow identifications on range and domain checks
o help in relationship discoveries
o identify referential integrity (pk/fk relationship) analysis
o perform the data quality functionalities without creating a copy of the data in
a proprietary/external format
o enable application of flexible business rules for validations
o enable drill through to source level information
o have the capability to cluster records
o have intuitive, flexible rules to identify households
o provide fuzzy logic to induce tolerance during matching
o use the parsed data to provide flexible matching criteria
o use scoring algorithms
o have the capability to merge the records into a gold standard
o have options for manual/automatic merging of clustered records
o enable to define rules for record and/or field selections during the merging
process
o have the capability to enrich data from internal data sources
o have the capability to enrich data from external/third party data sources
o invoke events to correct the data
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 88 of 250
Sr. No. Credit Risk Functional Requirements
The tool should provide capabilities to perform linear and nonlinear modeling,
classical statistical tests, time-series analysis, classification, clustering, and other
analytics including but not limited to:
Analysis of Variance (ANOVA) predictive models: t-test, one-way ANOVA,
nonparametric one-way ANOVA, linear models and mixed linear models.
Linear regression, Probit, Logit, logistic - binary, logistic multinomial (Unordered,
Ordered), nonlinear, generalized linear models and non-parametric regression.
Cluster analysis, CART, CHAID, factor analysis, principal components, canonical
correlation and discriminant function analysis.
Survival analysis: Life table and proportional hazards.
Control charts: mean and range, mean and standard deviation, individual
measurements, box, p, np, u and c charts.
Pareto: Pareto charts.
Monte Carlo Simulation
Gini indices
Correlation analysis
Forecasting: Data transformation, basic forecasting, ARIMA modeling and
forecasting, regression analysis with autoregressive errors and regression analysis of
panel data.
Support Neural Network, Genetic algorithm and Bayesian algorithm
Operations research: Numerical optimization, algebraic modeling language, project
and resource scheduling, generic algorithms and constraint programming.
Support grouping of variables through automatically creating groupings and allowing
to change the groupings interactively
Supporting modeling for: multiple category – binary, ordinal, nominal and continuous
Support Vector Machines
Support automatic modeling, regression – stepwise, backward and forward
Enable documentation and logs for the model development process
Have capability to archive models, model development process, validation process
and logs
Enable creation of pools for the retail portfolio based on the following criteria’s:-
Segmentation of the credit exposures using clustering techniques
Range of credit scores
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 89 of 250
Sr. No. Credit Risk Functional Requirements
Range of PD values
Range of PD & LGD values
Range of PD, LGD & CCF values
The solution should fulfill requirements of Working Paper 14 of BCBS document for
the validation of the rating systems.
The model validation solution should be able to perform validation of:
Internal rating system for various portfolios
Scoring models and Probability of Default (‘PD’) models (retail, corporates, sovereign,
equity and banks)
Loss Given Default (‘LGD’) models (retail, corporates, sovereign and banks)
Exposure at Default (‘EAD’) models (retail, corporates, sovereign and banks)
Solution should contain statistical package to support model validation tests such as:
Rating System and PD validation:
Discriminatory power test
Frequency and cumulative distribution graphs for both defaulters and non-defaulters
Cumulative Accuracy Profile (CAP) and its summary index, the Accuracy Ratio (AR)
Receiver Operating Characteristic (ROC) or the Area Under Curve (AUC) and its
summary indices, the Gini and
KS Statistic
Pairwise correlations
Expert ranking correlation
Kendall’s τ and Somers’ D (benchmarking)
Brier Score
Calibration accuracy test
Observed default rates compared to PDs for overall portfolio and at each rating
grade.
Binomial test
Chi-square test
Normal test
Traffic lights approach
Observed migration compared to projected migrations
Stability analysis
Population Stability Index (PSI)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 90 of 250
Sr. No. Credit Risk Functional Requirements
Rating migration matrix to illustrate rating stability
Granularity
Herfindahl Index (HHI)
Concentration per rating over time
Gini coefficient
LGD Model Validation
Discriminatory Power
Frequency and cumulative distribution graphs for observed and actual losses per LGD
bucket (or percentile).
Proxy Gini measure
Pair-wise correlations
Calibration
Observed loss rates compared to average predicted LGD for the overall portfolio and
per loss bucket (or percentile)
Applying ordinary least squares to fit the best linear regression, compare the
observed versus the predicted LGD
R-squared, Correlation
Observed versus predicted: recovery rate, cure rate, collateral values post default,
time to default, recovery costs
Stability
LGD migration between buckets (or percentiles)
Population stability index of: Key risk drivers including recoveries, collateral values
(pre and post default), recovery cost, cure rate and time to default and Overall
output
Granularity
Herfindahl index
Concentration per LGD bucket (or percentile) over time
EAD Model Validation
Discriminatory Power
Frequency and cumulative distribution graphs for observed and actual EADs.
Calibration Accuracy
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
Test if the average observed EAD equals the average predicted EAD
Applying ordinary least squares to fit the best linear regression, compare the
observed versus the predicted EAD
R-squared, Correlation
Stability
EAD migration between buckets (or percentiles)
Population stability index of overall EAD outputs
1.3
Model Deployment
Solution should support export of model implementation code in different format –
SQL, PMML, C, Java etc.
Support Interactive scoring in real-time or as batch process
1.4 The solution should support the creation of model inventory including but not limited
to areas of model development, amendments, validation performed including those
in the past, usage and so on
1.5 The solution should
Be able to analyze big data and generate visualizations on the fly, without any
performance degradation
have integrated modules for in-memory analytics comprising data preparation,
exploration, visualization and administration
provide self-service analytics on data in-memory without the need to create a
semantic metadata layer prior to exploration, thus reducing dependency for end
users
provide capabilities to forecast on the fly with forecasting confidence intervals to
further enhance data exploration and analysis.
provide Geographical map views to provide a quick understanding of geospatial data
have the capability to monitor the In-memory server environment including resource
utilization including CPU, I/O and memory, Mobile device logging history.
The solution should include/support
corporate and macro-economic variables included in the pre-defined mart, allowing
their use in models easily
Altmans Z through variables definitions
Pluto-Tasche method for LDP’s
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
Complex derived variables and allow for covenant based default definitions
Development and execution of facility and customer level scorecards – application
and behavioural
The solution should provide Quantitative risk strategies to integrate scorecard output
with other qualitative inputs based on business knowledge to facilitate informed
decision making
2.0 Capital Calculator
2.1 Asset Categorization
2.1.1 The solution should have the ability to categorize Bank’s exposures into IRB asset
classes as defined in RBI’s IRB Guidelines based on business rules. Asset/sub-asset
classes should include:
Corporate
Corporate Exposures
SME Corporate Exposures
Specialised Lending
Project Finance
Object Finance
Commodities Finance
Income Producing Real Estate
Sovereign
Bank
Retail
Exposures secured by residential properties
Qualifying revolving retail exposures
Other retail Exposures
Equity
Others
Comprising of fixed assets, venture capital fund, loans and advances to bank’s own
staff and any other exposure which the bank is not able to categorize under the five
asset classes given above
Securitization exposures
2.1.2 The system should be able to identify exposures to ECGC, BIS, IMF or any other
CANARA BANK
(HO: Bangalore)
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
MDB under the Bank asset class
2.1.3 The system should be able to identify restructured and default assets under each
asset category. Additionally, it should be able to identify restructured assets for
which ‘hardship’ clauses apply
2.1.4 The solution should be able to determine categorization exposure for each
transaction based on the product type, sanctioned limit and outstanding For e.g. :
for all fund based and non-fund based facilities including all forms of off-balance
sheet exposures, exposure would mean sanctioned limit or the actual outstanding
whichever is higher. In case of term loans and EMI based facilities, where there is no
scope for redrawing any portion of the sanctioned amounts, exposure shall mean
the actual outstanding.
2.1.5 The system should provide ability to add new business rules and modify existing
business rules based on changing regulations
2..2 Risk Components Determination
2.2.1 The system should have the ability to configure capital treatment approach per asset
category. The capital treatments include:
Standardized approach for all asset categories (for parallel run)
Foundation and Advanced IRB approach for corporate, bank and sovereign exposures
IRB for retail exposures
Equity IRB approaches:
PD/LGD approach
Market based approach
Simple risk weighted approach
Internal models method
Securitization IRB
Securitization Supervisory Formula (‘SF’)
Securitization Ratings-Based Approach (‘RBA’)
Supervisory Slotting for Specialized Lending
IRB approaches for purchased receivables – top down and bottom up approaches for
corporate purchase receivables and treatment for handling homogenous and
heterogeneous pools for retail purchase receivables
2.2.2 For portfolios under the standardised/simple risk weight/ supervisory formula
CANARA BANK
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
approaches, the solution should be able to map the exposures to appropriate
supervisory risk weights
2.2.3 The solution should be able to identify failed/default transactions and compute
capital for them as well
2.2.4 For securitization exposures, the solution should be able to apply a hierarchy of
approaches based on whether ratings are available or can be inferred
2.3 Final Value of Risk Components
2.3.1 Probability of Default
2.3.1.1 The solution should be able to map the transactions to appropriate PD values based
on facility and obligor characteristics and parameters in the relevant model
2.3.1.2 For each non-retail exposure, the solution should be able to map a single PD for all
multiple facilities/ exposures to the same customer.
For retail, the solution should be able to map PDs to each retail pool, identify
facilities in the pool and assign PD at a facility level.
2.3.1.3 The solution should be able to perform PD substitution in case of eligible guarantee
2.3.1.4 The solution should be able to apply a proxy PD where one does not exist
2.3.1.5 The solution should be able to accommodate inputs from external PD models
2.3.1.6 The solution should support use of business logic in order to apply the correct PD in
instances where more than one exists. For example, if new rating model (and as a
result associated PD) has been implemented, but not yet approved for use in
regulatory calculations
2.3.1.7 The solution should support situations where new PD rating models have been
developed, but not implemented, in order to assess the RWA impact on the portfolio
(or a sub-section thereof). For example through the use of a test/sandpit
environment that allows for analysis and comparison with live data
2.3.1.8 The solution should apply the supervisory floors (wherever applicable)
2.3.2 Loss Given Default/BEEL
CANARA BANK
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Management Architecture
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RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
2.3.2.1 The solution should be able to map the transactions to appropriate LGD values based
on facility, obligor characteristics and level of collateralization and lookup tables
provided by model development function
2.3.2.2 The solution should be able to handle inputs from external LGD models
2.3.2.3 The solution should support situations where new LGD estimates have been
developed, but not implemented, in order to assess the RWA impact on the portfolio
(or a sub-section thereof).For example through the use of a test/sandpit
environment that allows for analysis and comparison with live data
2.3.2.4 The solution should apply the supervisory floors (wherever applicable) For e.g. A
floor of 20% for LGDs for retail exposures secured by residential properties
2.3.2.5 The solution should be able to optimize the use of credit risk mitigants to enhance
the use of capital
2.3.2.6 For defaulted assets, the solution should be able to compute BEEL that considers the
amount of loss and the provisions
2.3.3 Exposure at Default
2.3.3.1 For on balance sheet exposures, the solution should support adjusting exposure
amounts for netting agreements
2.3.3.2 The solution should be able to apply appropriate haircuts to collateral (under the
netting agreement) for currency and maturity mismatches
2.3.3.3 Apply appropriate CCFs based on nature of transaction and capital treatment
approach i.e. AIRB
2.3.4 Maturity
2.3.4.1 The solution should compute effective maturity for the Bank’s non-retail exposures
(under the AIRB approach) based on expected cash flows and payment schedule for
repayment
2.3.4.2 The solution should be able apply residual maturity if effective maturity cannot be
computed
2.3.4.3 The solution should apply the supervisory floors and caps (wherever applicable)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
2.4 Manual Adjustments
2.4.1 The solution should have the ability to add, remove and modify transactions and
view data pre and post adjustment
2.4.2 The solution should have a provision to apply overrides at different levels :
transaction level and asset class level along with provision to capture rationale for
overdue
2.4.3 The solution should support configuration of an escalation matrix for approval for
the manual adjustments
2.4.4 The solution should identify the user (maker) applying a manual adjustment and the
user (checker) approving a manual adjustment as per delegation of authority matrix
2.4.5 The solution should enable adjustments before and after the RWA calculation and
re-performing the computation of RWAs
2.4.6 The system should enable bulk uploads for any missing transactions
2.4.7 The solution should allow reversal of the adjustments made
2.4.8 The solution should maintain an audit trail of all adjustments
2.5 RWA Calculation
2.5.1 The solution should be able to compute RWA at various levels : transactional level,
product level, exposure level and business unit and bank levels
2.5.2 The solution should support:
calculating an external view of the portfolio's RWA calculations, where all inputs /
models are approved for use by the regulator
calculating an internal view of the portfolio's RWA calculations, which include risk
components based on models which have not been approved by the regulator
calculating regulatory RWAs for the same portfolio under different approaches when
there is a specific requirement for a parallel run (e.g. in the case of a portfolio
moving from standardized to IRB approach)
2.5.3 The system should be able compute RWA for defaulted assets as a difference of
downturn and Best Estimate of Expected Loss (BEEL)
CANARA BANK
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RFP for Solution to Implement
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Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
2.5.4 The solution should have the ability to calculate Expected Loss (EL) and Excess EL
2.5.5 The solution be able to apply the relevant correlations per asset class and perform
firm-size adjustment for small and medium size entities as per the RBI guidelines
2.5.6 The solution should be able to calculate capital charges for default and dilution risk
for purchase receivables (corporate and retail exposures)
2.5.7 The solution should be able to calculate RWA reduction generated by securitization
of assets
2.5.8 The solution should be capable of performing daily and monthly regulatory RWA
calculations
2.5.9 The solution should be able to display original currencies and rupee equivalents by
using the same exchange rate provided by the front office for conversion of currency
to rupee equivalent.
2.6 RWA Aggregation
2.6.1 The solution should be able to aggregate RWA across all asset classes
2.6.2 The solution should be able to apply the scaling factor for all relevant assets classes
(assets for which the IRB treatment is applied)
2.6.3 The solution should be able to compare the amount of total eligible provisions with
the total EL amount as calculated within the IRB approach for determining
deductions to capital / common equity
3.0 Credit Risk Stress Testing and Event Identification
3.1 The system should have the capability to create, edit and maintain a scenario library
containing both bank-wide and business unit specific scenarios with assumptions,
portfolios and considered exclusion etc.
3.2 The system should have the ability to execute stress tests at a portfolio (or
exposures at a bank level) or a sub-portfolio or transaction level and should provide
ability to capture supporting information such as:
Scenario description and key assumptions.
Macroeconomic and industry specific data for specific stress testing themes based
on particular business groups and pre-defined scenarios.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 98 of 250
Sr. No. Credit Risk Functional Requirements
Stress the following key credit risk parameters:
PD (PIT and TTC) – Client, Portfolio Segment & Geography
Credit rating migration matrices
LGD (normal & downturn)
EAD via stressed CCFs
Correlations between PD/LGD/EAD
Collateral haircuts
Loss rates by product type and vintage for securitization
Other parameters decided by the bank periodically
3.3 The system should have the following capabilities with respect to the requirements
for Business Stress Testing:
The system should have the ability to set triggers for industries based on pre-
determined thresholds for Key Risk Indicators (KRIs) to alert the CRMD for initiating
stress tests.
The system should have the capability to link the primary industries with the
identified ancillary or second-order industries based on correlations.
3.4 The credit risk stress testing module should support quantifying the impact of stress
scenarios on the following performance measures at the Bank level and for sub-
portfolios (e.g. Corporate loans, Treasury Portfolios, etc.):
Expected loss;
Provisions on defaulted exposures;
Unexpected loss;
Risk weighted assets;
Profitability;
Growth in Non-Performing Assets on selected portfolios
Growth Rates of the bank across Core Industries
Total Income of the Bank
Economic capital; and
Capital Ratios (e.g. CRAR)
Other parameters as decided by the bank
3.5 The system should support facility by facility and/or higher level portfolio or
geography level stress testing to exposures and credit risk parameters, as part of
overall stress testing scenario.
CANARA BANK
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RFP for Solution to Implement
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Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
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Sr. No. Credit Risk Functional Requirements
3.6 System should be able to support manual overrides of parameters, stress test
results and maintain trails for the same.
3.7 System should capture the management action recommended for the scenarios
based on the severity of the results of the scenarios.
3.8 The system should provide ability to compare the following measures for base and
stressed conditions: exposures, credit risk parameters and resulting capital and
loss estimates.
3.9 System should provide ability to apply stress test scenarios for the current as well as
simulated portfolios of the Bank.
3.10 The system should be capable of performing/supporting reverse stress testing
including linking potential scenarios to targeted capital or tail losses
3.11 System should have the ability to connect with external sources to extract
information on economic factors, industry trends etc.
4.0 Limit Setting and Approval
4.1 The system should:
Provide capability to identify portfolios based on risk profile aggregation along with
ability to define and determine portfolio limits (across various dimensions e.g.
industry, sector, rating group) based on risk based approach (e.g. internal rating
scale)
Be able to develop and support optimization models (e.g. Hill Climbing Algorithms)
to determine credit limits.
Provide workflow mechanism to manage a rule-based limit approval process. Ability
to configure multiple approval workflows depending on business lines, products and
other considerations.
Maintain complete audit trail of the changes made with respect to change/approval
of limits.
Incorporate the effects of netting agreements, collateral and credit risk transfer
mechanisms (Credit Default Swap (CDS) and guarantees) while computing portfolio
risk for the bank.
Provide ability to calculate credit P/L for the portfolios considering default / no-
default and rating-transitions.
Provide ability to compute credit portfolio metrics including Expected Loss (EL),
Unexpected Loss (UL), Credit VaR (CVaR) and Expected Shortfall (ES) on marginal
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 100 of 250
Sr. No. Credit Risk Functional Requirements
and standalone basis for various portfolios and sub portfolios.
Have capability to capture inputs of bank strategy across parameters such as growth
in exposure to specific sectors, regions, products etc.
Periodic alerts to users when limit is due for review
5.0 Exposure Calculation, Aggregation and Concentration Risk
Non-Fund Based Market Related Products
5.1 The system should be able to estimate exposure for different purposes:
Regulatory Capital calculations
Economic Capital Calculations
Credit Risk Control purposes (e.g. Limit setting, Concentration monitoring)
5.2 System should be able to determine Mark to Market (MTM) or replacement value
using full-revaluation approach for the following set of indicative products:
Derivative products – FRAs, Interest Rate Swaps, Cross Currency Swaps, FX forward
and FX options;
Equities;
Mutual Fund units;
Corporate Bonds, Government Securities, Hybrid Securities;
Structured notes (e.g. CLNs, CDOs); and
Money market products – Commercial papers, Commercial deposits, repos, reverse
repos.
5.3 System should provide ability to determine Potential Future Exposure (PFE) for off-
balance sheet items including derivatives and other non-fund based banking
products for normal market conditions and stress market conditions.
5.4 System should be able to determine Potential Future Exposure using different
approaches:
Monte-Carlo simulation based approach.
Credit Conversion Factor (CCF) based approach (MTM + Add-on approach).
Any other relevant advanced methods that are widely in use Internationally
5.5 System should provide ability to compute Credit Value Adjustment (CVA) as
prescribed by RBI in Basel-III guidelines based on PFE profile
System should provide ability to compute CVA on marginal basis and standalone
basis at trade level and portfolio levels
5.6 System should provide ability to:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 101 of 250
Sr. No. Credit Risk Functional Requirements
Determine MTM and exposure for future points in time with explicit consideration
for ageing of the trades.
Simulate various relevant market risk factors (e.g. interest rate, equity, foreign
exchange rates) using Monte Carlo approach using various stochastic processes (e.g.
Geometric Brownian Motion or GBM, mean-reversion models).
Measure Potential Future Exposure (PFE) for various tenor points (e.g. up to 20
years or 30 years as desired by the Bank).
Produce other exposure related metrics including Expected Exposure (EE), Effective
Expected Exposure (EEE), Expected Positive Exposure (EPE) and Effective EPE for
normal market conditions and stressed market conditions.
Aggregate Direct, Indirect and Contingent exposure for borrower/counterparty and
borrower/counterparty and across various groups.
Determine gross and net exposure (incorporating the effects of netting, collaterals,
and credit hedges) for current exposure and potential future exposure
Ability to capture information related to collaterals and netting with respect to Over
the Counter (OTC) derivatives transaction
Non Fund Based Non Market Related
5.7 The system should be able to estimate exposure for different purposes through CCF
estimation:
Regulatory Capital calculations
Economic Capital Calculations
Credit Risk Control purposes (e.g. Limit setting, Concentration monitoring)
Exposure Aggregation and Concentration Management
5.8 Based on extraction of data, the solution should be able to:
Aggregate credit exposure and credit equivalents for non-funded products including
derivatives and other market based product exposures based on rules
Maintain different rules for credit exposure aggregation for different purposes (for
e.g. regulatory capital purposes vs. economic capital calculations) and utilisation vis-
à-vis risk based limits.
Ability to measure and distinguish direct, indirect and contingent exposure for
various portfolios and sub portfolios (e.g. borrower, borrower groups, industry,
country, product group).
Ability to aggregate and consolidate credit exposures across domestic and
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 102 of 250
Sr. No. Credit Risk Functional Requirements
international locations as per prudential norms set out by the regulator(s).
5.9 The system should be able to
Support measurement of concentration risk across different categories of
exposures, for e.g. Top 20 single borrowers, Top 10 group borrowers, Top 20
depositors.
Model risk correlations among different borrowers /sectors /industries, etc. and
factor it in concentration risk management
Measure concentration risk using different measures, for e.g. Lorenz Curve,
Herfindahl-Hirschman Index (HHI), Gini coefficient.
Measure diversification benefit on a dynamic basis for the bank on a standalone
and consolidated basis
Integration with loan proposal and review systems for monitoring concentration
prior to sanction.
Provide workflow for approval of limit breaches with adequate audit trails.
Provide alerts on dynamic basis before exposure is sanctioned to identify breaches
6.0 Wrong-way Risk
6.1 The system should support :
Identification and measurement of wrong way risk.
Measurement of settlement risk (including incremental default risk in the trading
book).
6.2 The system should provide ability to:
Identify and display block trades and facilities involving wrong-way risk before
execution of trades/facilities based on business rules.
Identify and display specific or general wrong-way risk involved in the Treasury and
Banking transactions
Track underlying collateral linked to wrong way risk transactions.
Quantify the wrong-way risk exposure in the portfolio separately.
Make specific adjustments to credit risk parameters for the counterparties/ trades
or facilities (PD, LGD, EAD) involving wrong way risk.
Report exposures for counterparties with and without including wrong-way risk
exposure.
Specify separate limits and approval work flows for trades/facilities involving
wrong-way risk.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 103 of 250
Sr. No. Credit Risk Functional Requirements
Rate and estimate credit risk components (PD, LGD) for the credit protection
providers (Guarantors and CDS providers) and the underlying trades/facilities.
Estimate credit loss for all possible scenarios involving default/no-default of
protection providers and the underlying reference entity.
Specific adjustments to credit risk components (PD, LGD) for trades/banking
facilities involving multiple entities.
7.0 Collateral Management
7.1 The solution should have facilities for extracting, displaying and exporting the
following details, but not limited to, from the source systems (or enterprise data
warehouse as and when functional) vide user defined reports or system triggered
alerts
7.1.1 Collateral and Guarantor details
Nature/description of collateral securities
Data points to enable classification of collateral in to IRB eligible collateral as per
regulatory considerations along with classification outcome
Collateral(s) and the list of related facilities
Legal relationship between collateral provider and borrower
Personal / Corporate guarantor information including means of guarantor
7.1.2 Collateral Valuation
Valuation details including date of valuation, name of valuer, next valuation due
date, frequency of valuation based on type of collateral and margin details
7.1.3 Guarantees accepted /credit default swaps purchased by the Bank:
Data points to assess eligibility of the same as means of credit protection along with
existing status of eligibility for capital relief under IRB regulatory guidelines
prescribed.
Details of the guarantee taken as part of the loan including comprehensive details
of the guarantor(s).
Value of the guarantee/CDS including the % of facility covered and exclusions in
guarantee/CDS agreement.
Linkage between the guarantees and its facilities.
7.1.4 Managing Collateral documentation and storage:
Details of documents to be collected as per the legal opinion, name of the
empanelled lawyer providing opinion, etc. along with details of those already
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 104 of 250
Sr. No. Credit Risk Functional Requirements
collected
Details of the legal documents actually collected for each product type.
Storage/despatch details of the security.
Work flow Status for monitoring of the movement of the security documents from
the storage till the final release to the customer.
7.1.5 Insurance:
Details of the security- insurance company, validity of the policy, exclusions from
the policy, insured amount etc.
Providing alerts when insurance pertaining to a collateral falls due for expiry
7.1.6 Legal aspects of collateral:
Details of legal documentation collected pertaining to the facility including
deviations if any.
Information from external sources like Ministry of Corporate Affairs, central registry
of properties.
7.1.7 Pending collateral to be collected.
Average Loan to Value ratios of the portfolio.
Average margin and extra collateral to be collected.
Concentration of collateral based on collateral type
7.1.8 Others:
Details for treatment of pools of collateral, maturity and currency mismatches.
Details of the actual realisation value during sale/auction of securities when they
are classified as NPA.
Associated costs related to sale and recovery such as but not limited to legal costs,
administrative costs, haircuts and other disposal costs and related time for
completing sale of assets
7.2 Functional
Provide alerts for top up of security in case its value breaches acceptable
thresholds.
Estimate value of collateral using market price on real time basis
Setting up master data regarding external vendors.
Capability to de-duplicate internal information to identify if the security has already
been assigned to any other facility
Classification into IRB eligible Collaterals
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 105 of 250
Sr. No. Credit Risk Functional Requirements
Assess eligibility of Guarantee and CDS as Credit Risk Mitigant
8.0 Credit Risk Based Pricing
8.1 The system should support enable computation of Risk based Pricing as per the
methodology defined linking it to the Rating grades and the PD bands separately for
retail and corporate accounts.
8.2 The system should be able to aggregate cost of funds, operating expenses, cost of
capital and other costs, spread and risk premium as calculated using PD and
assumed LGD values.
8.3 The system should embed standard pricing calculations and policies into the loan
origination workflow, and understand the impact of each deal on the shareholder
value.
8.4 The system should support calculation of RAROC based on regulatory capital as well
as economic capital. It should also calculate RAROC at various levels of granularity
i.e. deal level, facility level, account level and relationship level to provide analysis
of impact of new loan on overall risk and return.
8.5 System should allow monitoring of deals that have been approved by the business
below the hurdle rate defined by the bank. This should include details such as
reason for override, amount of override, approver, relationship manager etc., along
with complete documentation on workflows and pricing calculations to assist in
improvement of the pricing process.
8.6 System should capture audit trails to satisfy regulatory requirements that the risks
inherent in loan products and services have been adequately accounted for in the
pricing of loans.
8.7 System should have adequate controls to ensure that loan pricing practices comply
with bank policies and strategy including authorization and also facilitate adequate
reporting to appropriate levels of all exceptions.
8.8 The tools for arriving at RAROC and Risk based pricing basis Regulatory and
economic capital to include all relevant relationship components (revenues and
expenses) and also carry capability to depict future profitability/returns
8.9 The comparison of pricing for different customer views e.g. industry, product
geography, business unit, related MIS and reporting on the corporate portfolio
should be enabled at the Head office level.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 106 of 250
Sr. No. Credit Risk Functional Requirements
8.10 The system should enable branch / Relationship managers to price deals, offer
alternatively deal structures, and respond to customer requests by direct input of
necessary details.
8.11 The system should calculate a price based on a target performance metric and re-
calculate performance if a price override is granted.
8.12 System should provide complete flexibility and control. It should pull in data from
third-party systems and internally built tools, as well as adjust the data to create a
differentiated pricing approach. It shall also retain audit trail.
8.13 The system should support industry standard pricing models for a wide range of
derivative and non-derivative products.
9.0 Capital Planning
9.1 System should enable capture of requisite data and for user defined periods for
development of the capital plan at the bank and at sub portfolio levels such as but
not limited to
Balance sheet and PL estimates
Anticipated growth in topline/revenue year on year, profitability margins, costs
Increase in risk weighted assets
Capital types, amounts, maturity (for non-equity), capital cost.
Risk Adjusted performance measures across various business lines and products
9.2 The system should have capital planning and budgeting modules for estimating
bank-wide capital for future, stress testing by changing assumptions/ macro-
economic scenarios, allocation across business units, geographies, products etc., if
needed.
10.0 Reporting
10.1 The system should generate reports both for internal and external/regulatory
purposes including all Pillar 3 disclosures under Basel II and III.
10.2 Capital Calculation
The system should have the ability to produce reports related to capital adequacy
and risk components. Reports may include:
External Reports
Capital Adequacy for all exposures (except equity)
Capital Adequacy Disclosures for equity exposures
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 107 of 250
Sr. No. Credit Risk Functional Requirements
Exposures (except equity) covered under Basel II approaches
Report on Exposures subject to Supervisory Risk Weights
Capital Calculation Reporting by PD Range
Capital Calculation Reporting by LGD Range
Disclosures for retail exposures by PD and LGD range
Disclosures for retail exposures by EL grades
Disclosures for retail exposures by pools
Charge-offs and specific provisions
Write-offs, provisions and risk components
Bank's estimates against actual outcomes
PD comparison report
LGD comparison report
EAD comparison report
Mitigation Analysis Report
Eligible Collateral Analysis Report
Approaches followed and coverage of exposures
Qualitative disclosures for IRB approaches
Qualitative Disclosures for Credit Risk Mitigation
Internal reports
Analysis of Exposures Asset Class-wise
Asset Migration Report
Facility Utilization Report
Overdraft Credit Quality Report
Collateral Revaluation Report
Corporate Exposures - Rating Model Compliance Report
Retail Exposures - Rating Model Compliance Report
Specialized Lending - Rating Model Compliance Report
Rating Grade Assignment Report
Rating Grade Comparison Report
Rating Grade Migration Report
Rating Grade Overdue Compliance Report
Historical Default Analysis Report – Obligor Level
Historical Default Analysis Report – Portfolio Level
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 108 of 250
Sr. No. Credit Risk Functional Requirements
Historical Default Analysis Report – Rating Grade Level
Rating Grade analysis
Analysis of Default across Rating Grades
Rating Grade Distribution Report
LGD Migration Report
EL Band Distribution Report
Maturity Mismatch Reports
Analysis of Maturity Mismatch as per facility
Analysis of Maturity Mismatch Bucket-wise
Stress Test Reports
Report on Specialized Lending (SL) RWs
Disclosures for SL Exposures – Sub-category wise
Report on Equity Exposure RWs
Notional Principal and Credit Equivalent amounts for non-market related off-balance
sheet exposures.
Notional Principal and Credit Equivalent amounts for market related off-balance
sheet exposures.
RWA and EL for default and dilution risk for Purchased Receivable Exposures
RWA and Capital for Securitization Exposures
Manual Adjustments Report
Expected Loss & Provisioning Comparison report
Pool Migration Report
The solution should be able to perform reporting by defined calendar period at the
transactional level (E.g. comparing RWA, PD, LGD and EAD at transaction level)
10.3 Stress Testing-
System should provide dashboards and reporting for base and stress test results
across the multi-year horizons. System should provide ability to drill down the
results of stress testing based on portfolio, sub portfolio, borrower, industry,
geography and business entities specific to the Bank should be possible.
10.4 Limit Setting and Portfolio Reporting
System should:
Generate standardized reports for portfolio/limit analysis on demand basis.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 109 of 250
Sr. No. Credit Risk Functional Requirements
Provide ability to the user to drill down from the portfolio level to the individual
facility/product/exposure level, enabling multi-dimensional analysis as required
(Portfolio snapshot/ Time series analysis/ Facility level exposures/ Exceptions
generated/ Limit breach instances/ Track record of repayment, etc.).
Provide early warning signals based on various parameters to identify deterioration
in asset quality, borrower quality, trends in limit utilization etc.
Provide report of the results of the measurement of concentrations risk. The MIS
reporting function should be dynamic and open for customization.
10.5 Credit Risk Analysis and Reporting Capabilities:
Rating migration matrix, which would provide insights on the overall quality of the
credit portfolio capturing the following information:
Number of accounts across rating grades at the start/end of the period.
% accounts migrated to better or worse grade.
Exposure metrics for various exposure types (e.g. direct, indirect, contingent etc.,)
for portfolios and sub-portfolios.
Ratings Distribution across exposures and migration analysis.
Performance metrics like EL, UL, Sharpe ratio, risk contribution, earning
components etc.
Support credit Risk MIS reports across various portfolio dimensions including the
following:
Product type
Branch
Circle
Country
Remedial action
Business unit
Scorecard / Collectability
Balance at risk
Customer Value and band
Collateral
Reports on Quick Mortality Analysis.
Reports on Loan to Value (LTV) analysis.
Interest rate sensitivity analysis reports.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 110 of 250
Sr. No. Credit Risk Functional Requirements
Customer value report.
10.6 Credit Risk Pricing
The system should have the ability to see all pending deals and their performance
relative to the overall portfolio and the organization’s policies.
System should support dashboard reporting to provide insights into pricing, price
sensitivity, competitor pricing, attrition risk, and opportunities for improvement.
Ideally the reporting should provide drill-down functionality by division, region,
branch, and employee.
10.7 Capital Planning
Provide report on the capital plan of the bank for user defined period and at
varying level of granularity in terms of balance sheet, products, and business
10.8 In addition to specific reporting requirements mentioned above for specific modules,
the system should support the following general reporting requirements across all
modules:
The system should provide a robust reporting framework that can generate a wide
range of standard and user defined reports (Dashboards for Senior Management and
detailed reports for risk managers).
The solution should enable report customization by allowing users to specify the
exact layout of the required report including location of fields, header, footer and
title.
Reports should be user-configurable with the flexibility to add/remove certain fields,
data sources etc.
Users should be able to see/download the underlying data related to a report. The
solution should enable an admin user to define users to whom reports can be sent
automatically
Reports should be generated both through batch processing and on-demand basis.
Reports must be customizable according to different user levels and authorizations
The solution should support graphs, charts and other graphical representations to be
embedded in the reports
The solution should have the ability to allow for slice and dice and generate different
dimensions of the data. It should also allow for sorting of data in reports
The solution should enable user to define filters for reports
The solution should support the following file formats for generating reports:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 111 of 250
Sr. No. Credit Risk Functional Requirements
o View Mode
o Excel Mode
o Text Mode
o HTML Table
o CSV format
11 Training
11.1 The system should have training modules for each component
The modules have to be complemented by training workshops conducted by the
vendor
6.1.2 Functional Requirements for Loan Origination System (LOS)
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format sub section 11.4.1.
Sr. No Functional Requirements for LOS
Loan Origination – Corporate Portfolio
1.0 Lead Management
1.1 The system should provide ability to create lifecycle stages of a lead including but
not limited to income potential, deal value, deal nature, actionables, status
1.2 The system should be able to generate analysis and reports on the leads. The
reports should be able to track the lifecycle of the lead and variation from specified
targets.
1.3 The system should enable the sales person/relationship manager to view the
history of the relationship with the Bank highlighting any irregularities.
2.0 Customer Management
2.1 The system should provide ability to:
Record all customer interactions.
Capture the financial data of the customer both current and projections (if
needed): Equity / capital details, Credit facility sanctioned/availed by/from other
banks/institutions, profit and loss statements, balance sheet statements, projected
cash flows.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 112 of 250
Sr. No Functional Requirements for LOS
Spread core financial statement data and other qualitative data through
standardized spreads with optionality for various accounting standards and
currencies (USD,EUR,HKD,AUD etc.)
Allows users to directly enter projected financial statement information under
different scenarios or via the solution be able to forward project the financials
Capture Non-financial details of the customer but not limited to the below :
Management – its quality, succession planning, total relevant experience and
details such as names of directors, designations, addresses, Din, experience.
Installed and licensed capacities, Number of operating Units, Locations,
Environmental clearances etc.
industry details - growth, profitability margins (operating, net), competition etc.
project details – date of commercial operation, regulatory approvals,
environmental clearance
Others - Trade terms with buyers and suppliers, exposure to foreign currency risk
etc.,
Interface with external credit bureaus for external credit ratings.
To introduce new fields for data capture as required for model development and
deployment
2.2 Cross Selling:
The system should be able to suggest products for cross selling through predictive
analysis.
3.0 Document Management
3.1 The system should be able to maintain all relevant customer documentation in soft
copy format including:
Financial statements
Quarterly Progress Report(QPR) statement
Stock statements
Comments on operations/over dues
4.0 Proposal Evaluation
4.1 The system should be able to perform financial performance analysis of data based
on the following criteria:
Ratio Analysis based on - turnover, liquidity, profitability, leverage, debt service
ratios, etc.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 113 of 250
Sr. No Functional Requirements for LOS
Balance sheet and Profit and Loss analysis
Cash flow and fund-flow analysis
Internal rate of return (IRR)/ net present value (NPV) analysis
Drawing power analysis
Ability to compute ratings and risk components (PD, LGD) for the customers based
on specified models
4.2 The system should provide ability to host/deploy models either directly (embedded
model) or through the model deployment platform for ratings and risk component
estimation (PD and LGD) at various levels of granularity (facility level, customer
level etc.) and as a pre and post sanction exercise
4.3 The system should be able to perform comparison of selected key ratios, financial
parameters across borrowers within the industry and against bench marks.
4.4 The system should be able to provide an initial assessment of working capital /
term loan requirement based on the financial performance measures and policy
thresholds.
5.0 Review and Decision Making
5.1 The system should aid credit decision making based on the proposal evaluation
analysis and credit risk rating. It should facilitate users/reviewers in understanding
assessments through electronic case files and summary reports
5.2 The system should be able to capture external ratings for the customers as well as
interactions between individuals involved in the rating and loan sanction process
E.g. proposal flow including details of the reviewer/approver, sales manager etc.
along with their comments. The system should also be flexible i.e. capable of being
configured and calibrated in line with the bank’s internal credit culture, policies,
and experience.
5.3 The system should support creation and maintenance of a list of standard user-
defined terms and conditions, which will be included in the appraisal note and
sanction letters.
5.4 The system should have the ability to:
Record syndication process across various institution and banks.
Price loan based on proprietary pricing model using PD, LGD and other details at
origination
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 114 of 250
Sr. No Functional Requirements for LOS
Capture variances if any in model-determined and the actual pricing
Capture overrides along with facility to add notes to explain/provide justification
for the override
6.0 Loan Sanctioning
6.1 The system should support creation of sanction advice with the following details at
a minimum:
Customer details
Product details
Classification of loan / sector code
Purpose of the sanctioned loan
Terms and conditions of the sanction amount (rate of interest including any
additional charges applicable)
Period of sanction or tenure of loan
Payment terms of interest, margin etc.
Credit rating
Repayment schedules
Moratorium period
Renewal details (where applicable)
Charges to be created with appropriate authorities
Guarantees
Insurance details
Documentation and legal formalities to be executed
7.0 Credit Management
7.1 Support risk assessment tool(s) to enable monitoring of existing loans along with
the list of required information and how credit monitoring team would use the
tool(s). The tool(s) should be user friendly and enable the bank officers to monitor,
analyze and action as required.
Support early warning and related risk and monitoring systems across all portfolios
of the bank
Support calculator for customer life time value (CLTV)
Provide ability to carry out/implement account monitoring including identification
of unlikeliness to pay and other follow up strategies.
Provide capabilities for continual improvement in risk management and monitoring
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 115 of 250
Sr. No Functional Requirements for LOS
systems.
Provide linkages to the credit risk pricing module to enable consideration of
customer value for pricing purposes
Offer single view of customer/relationship/group
Provide all account related and other details for an effective account monitoring
and devising credit risk management strategies.
6.2 Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for successful
implementation of the offered Solution, in the format specified in Annexure 11.4 Technical Bid
Format sub section 11.4.2.
Sr. No. Module/ Item Module Description Requirement Quantity
Note: The hardware and infrastructure sizing should be done with a user base of 7500 users for
CRMS and LOS with a scope of annual growth of 15 – 20% for next 7 years.
6.3 Training Requirements
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.3.
Sr. No. Requirements
1 How many Implementation trainings (CRMS and LOS) have been undertaken by
the Bidder so far?
2 Please provide a brief description on the Training approach taken by the Bidder.
3 Please provide the following details for training :
3.1 Number of man‐days / duration for completion of training
3.2 Optimum batch size
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 116 of 250
Sr. No. Requirements
3.3 Total efforts for conducting the training
3.4 Location
3.5 Frequency of training offered
3.6 Pre‐requisites / Preparations required before training
4 Please answer the following about the trainers in‐charge of conducting the
training on behalf of the Bidder for the Bank:
4.1 Median experience of all trainers with the Bidder who would be involved with the
Project
4.2 Median experience of all trainers involved with the Project, working / training on
the solution proposed by the Bidder
5 Please provide a sample training response and feedback from previous
implementations
Also, please give details of the following:
5.1 Name of the Bank where product was implemented and the training conducted
5.2 Date and place where training conducted
5.3 Training audience
5.4 Indicative rating [if any provided] Note: Please attach the feedback in a separate
document with proper cross‐referencing
6 Please specify the various modes through which the training will be delivered?
[e.g. Classroom training, Online self‐help training modules within application
/ e‐learning modules, Quiz, etc.]
6.4 Project Management Methodology
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.4.
Sr. No Requirements
1 Details of methodology / approach
The methodology section should Adequately address the following stages of the
project:
1.1 Frequency and approach for periodic reporting on the progress of the project and
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Sr. No Requirements
actual status vis‐ à‐vis scheduled status
1.2 Detailed Study of Current State, with detailed work steps and deliverables
1.3 Gap analysis including identification and resolution of gaps
1.4 Customization, development and necessary work around
1.5 Building up of interfaces with various applications currently used by the Bank
1.6 Setting up of the data center and the disaster recovery site
1.7 User acceptance testing
1.8 Planning for roll‐out and identification of key issues that may arise along with
proposed solutions
2 Timelines
3 Project management activities
4 Roles and responsibilities of proposed personnel both from the bidder
5 Following details with respect to the methodology followed by the bidder in
Project Management for a Public Sector/Private Bank of comparable size/
complexity of operations as that of Canara Bank
5.1. Project Name
5.2. Project Location
5.3. Client Name
5.4. Client address
5.5. Client contact/reference person(s)
5.6. Project started (month/year)
5.7. Project elapsed time – months
5.8. Man months effort
5.9. Project Size (No of branches, modules covered and any other relevant
details)
5.10. Name of senior project staff
5.11. Nature of the Project
5.12. Project Management Methodology used
5.13. Role of the Bidder, whether complete end‐to‐end involvement or for a particular
module
5.14. Project detail (Broad detail – information about all activities handled, modules
forming part of the Credit Risk and LOS Project of the Client Bank, associated
CANARA BANK
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RFP for Solution to Implement
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Management Architecture
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RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 118 of 250
Sr. No Requirements
activities, time lines activity‐wise and module‐ wise may be detailed.)
7. Functional Requirements for Operational Risk
The Bank aims to improve its operational risk management capabilities to migrate to Advanced
Measurement Approach (AMA). To this end, the Bank is developing policies, frameworks to
address the qualitative and quantitative requirements of RBI. For quantification of operational
risk capital under AMA, it is essential that the Bank has robust operational risk management
system and tools in place, considering the complexity involved in the process. This section sets
out the functional requirements for an Operational Risk Management Solution (ORMS) for
estimation of operational risk capital under AMA. The system should support operational risk
measurement and modeling as per RBI and Basel II requirements under AMA. ORMS should be
available to the bank at Enterprise-wide Level.
7.1 Functional Requirements for Operational Risk
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format sub section 11.4.5.
Sr. No. Operational Risk Functional Requirements
1.0 General Requirements
1.1
Configurations of the bank’s legal, governance and business structure such as
group, legal entities, organization and governance structure, risk entities,
product, processes, systems, locations, business lines, outsourcing vendors and
other dimensions enabling operational risk management and measurement.
1.2 Configuration of bank’s operational risk management framework in terms of
methodology, work-flow, templates, consolidation, analysis and reporting.
1.3
Administration of the module to define access to the system as per job profile of
the employee with function specific controls such as read-only, restricted access
to reports, no deletion rights etc. Flexibility to provide and control access rights
at various dimensions such as location, geography, employee, department / unit
etc.
1.4 Availability of comprehensive audit trail with report generation facility.
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Sr. No. Operational Risk Functional Requirements
1.5 Pre-configured report on exception with ability to configure reports based on
requirements of the bank.
1.6
Flexibility for system enhancement due to change in regulatory requirements,
bank’s policy and procedures and due to good risk management practices, as
required by the bank.
1.7 Existing pre-configured relevant database of risk and controls, external loss data,
KRI, scenarios etc.
1.8 Multi-lingual, which can help to roll-out in multiple jurisdiction.
1.9 The system should have ‘help’ function to assist the user in understanding the
system functionality.
1.10
System should facilitate alerts, reminders, notifications at various stages of ORM
framework implementation such as RCSA, KRI, Loss data etc. by various channels
such as e-mails, SMS etc.
1.11
The system should have the functionality to create, approve, save, submit, reject,
view, print, download, upload, de-activate & delete records/data at appropriate
places of the work-flow attached to the user rights matrix.
1.12 System should give relevant error message such as on incomplete data upload,
on execution of wrong command etc. including generation of log
1.13 System should provide search facility of various records using fields which are
used to define that particular record.
2. Risk Control Self-Assessment (RCSA)
2.1 The system should enable to upload, plan and facilitate, tracking and reporting
on a bank-wide basis of the risk and control self-assessment process.
2.2
Planning for RCSA by considering various parameters such as risk profile, business
size of the risk entity, audit findings, actual loss experience, inherent criticality of
the business operations and various other parameters considered relevant by the
bank. Planning will ensure identification of risk entities for assessment over the
RCSA period.
2.3
Support planning such that it can be done for some of the processes for a
particular risk entity e.g. under a particular RCSA schedule, bank may decide not
to cover all the processes of the branch or may decide different processes for
each branch.
2.4 System should have customized templates for rolling out RCSA across all the
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Management Architecture
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Sr. No. Operational Risk Functional Requirements
operational/ functional/ administrative units. The bidder should assist in
customizing the RCSA templates to suit the requirements of the Bank.
2.5
The system should support rollout of RCSA using multiple approaches such as
top-down, bottom-up and hybrid as determined by the Bank. Methodology may
include clustering / grouping of risk entities by risk profile, geography or any
other criteria where each cluster can be treated as one risk entity.
2.6 The system should have the capability to map the existing Organization Structure
to the relevant Business Line as per RBI Basel-II guidelines.
2.7 The system should support questionnaire based & risk based RCSA approach.
2.8 System should facilitate end users to rate the identified risks and controls.
2.9
Assessment scheduling shall be done through the system as to when RCSA is to
be done over defined RCSA period. System should have capabilities of sending
auto reminders through emails when the scheduling is due and escalation for
delay in completing the assessment to various levels. Scheduling will ensure
timing of the RCSA of a particular risk entity in the RCSA period. System should
support assigning ownership for each RCSA schedule.
2.10 Control record should have the classifications of "key or secondary", "detective
or preventive", "automated or manual".
2.11
It should create RCSA template for risk and control assessment which should be
customizable as per risk entity, as all risk-entity may not have same number of
risk events.
2.12 The system should enable logical structuring of the self-assessment scenarios
into units, departments and business lines.
2.13
The system should have the capability to automatically communicate the
identified outliers to the respective users for further clarifications through bulk e-
mail or other appropriate modes.
2.14 The system should have the capability to reclassify/categorize the operational
risks as per Basel/RBI Guidelines.
2.15
The system should have the capability to generate heat maps automatically
based on testing results and compare the same with earlier heat maps to
highlight the shift in risk levels.
2.16 The system should have the capability to customize the logic used for creating
Heat Maps (preferably through a master user setting).
CANARA BANK
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Enterprise-wide Integrated Risk
Management Architecture
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Sr. No. Operational Risk Functional Requirements
2.17 The system should have a dashboard facility to view the risk profiles by business
area, business unit, Basel business category etc.
2.18
System should maintain an inventory of assessment questionnaires and provide
an option for two factor assessment viz. probability and estimated impact. It
should have the functionality to assign assessment questionnaire to identified
business units. Scope for multiple units assessing same process, risk, cause and
control to be supported.
2.19 System should have the capability of rolling out web-enabled RCSA solution.
2.20 The system should have the functionality to retain a historical record of previous
self-assessments for comparing with present self-assessment results.
2.21 The system should have the capability to upload the existing RCSA assessments
with the Bank, stored in MS-excel, word etc. formats.
2.22
RCSA template must have the facility for creation of risk and control library .It
should have flexibility to enter any new risks identified and corresponding
controls in all the operations and activities of the bank including in the support
functions. Risk and controls so identified should be updated in the risk and
control data library.
2.23 Risk and Controls in the RCSA template should be sourced from the Risk and
Control Library to avoid repetitive preparation of templates.
2.24
System should have flexibility to create numerous templates based on type of
risk entity, e.g.: type of branches, operating units etc. by incorporating processes,
risks and controls.
2.25
It should have facility to roll-out of the same template to multiple risk entities
due to similarities in the risk profile e.g. rural branches can have similar type of
template.
2.26
Template should be designed with appropriate classification, sub-classification,
sequencing, grouping and sub-grouping of risk events as specified by the bank
e.g. logical sequencing of first processes and then risks and controls within a
particular process.
2.27
Risk and controls should be mapped to respective classification such as risk
entity, process, product, Basel II classification, causal factors, risk drivers,
significant / non-significant risk, preventive / detective control, control
frequency, risk identification by (auditor / risk entity / ORMD / external events /
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Management Architecture
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Sr. No. Operational Risk Functional Requirements
others) etc.
2.28
System should facilitate performing RCSA in two ways i.e. (i) inherent risk, control
design and operating effectiveness and residual risk assessment (ii) only residual
risk assessment.
2.29
While performing the risk assessment, user should be able to see the respective
process / activities under consideration/assessment process. User should also be
able to enter any remark while doing the assessment.
2.30 System should facilitate performing RCSA assessment by multiple users
simultaneously for the same risk entity.
2.31
Scale for risk assessment available in the system should be customizable by the
bank with appropriate color coding where each color should bear a different
meaning.
2.32 The system should be able to capture RCSA testing results.
2.33 The system should have the ability to compute residual risk values based on the
ratings applied for risks and controls for each process step.
2.34 Residual risk should be rated as a result of probability and impact assessment by
the system i.e. product of probability and impact.
2.35 The System should be able to aggregate the different ratings across branches,
circles, products, processes etc. and identify outliers.
2.36 Report on comparison of RCSA results with past RCSA results.
2.37 The system should be able to re-run the past assessments based on the revised
scale when there is a change in the rating scales.
2.38 Exceptional reports such as risk entities which has not completed RCSA as per
schedule.
2.39 Graphical report on overall Residual risk with comparison and drill-down facility
at multiple dimensions and to the most granular level.
2.40
Generate reports of RCSA results such as action plan report etc. in order to share
it with internal audit, compliance, information security etc. to validate the
implementation in the next audit / review.
2.41 The system should record action points arising out of RCSA exercise It should also
generate test plan in accordance with agreed timelines.
2.42 The system should be able to follow up for unresolved action points and generate
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Sr. No. Operational Risk Functional Requirements
status report for the same.
2.43 It should have standard reporting formats as well should be able to customize
reports as required by the bank at no extra cost.
2.44
Action plan should include information such as task to be done, original target
date, revised target date, number of revisions done in the target date, owner for
action plan, link with the respective risk event etc.
2.45
ORMD should be able to change the RCSA rating based on validation results or on
occurrence of some risk event within or outside the bank. Change in RCSA rating
should happen through recording of an audit trail and communication to the
concerned risk entity by automated e-mail. Rating can be changed of a risk,
process, risk entity etc.
2.46 The system should provide linkages of risks and controls with assessments, KRI,
loss data, plan of action and ownership.
2.47 There should be a document upload facility to substantiate the RCSA.
2.48
System should provide monitoring of RCSA status to various users such as ORMD
where they can view by branch, region, zone, bank, group level for a given time
period.
2.49 Bidder should conduct a sample run of the entire RCSA exercise as per the
process mentioned by the Bank.
3. Risk and Control Data Library, External Loss Data and KRI Data
3.1 Risk and Control Data Library
3.1.1 There should be a separate Risk and Control Data Library to store all the risks &
controls at bank wide level in a centralized manner
3.1.2
Risk should be mapped and classified with process, product, system, compliance
standard / guidelines, outsourcing, risk type, business line, causal factor, risk
drivers, significant / non-significant etc. and control should be mapped to its
frequency, type (preventive & detective) etc.
3.1.3 It should facilitate to view the risks and controls using various filters used to
define risk and control
3.1.4 Upload and download facility should be available in the standardized template.
3.1.5 It should generate reports based on the defined criteria over and above standard
reports in the system. Bank specific reporting requirement should be
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Sr. No. Operational Risk Functional Requirements
customizable.
3.2 External Loss Database
3.2.1
Provide a database of External Loss in a structured manner with appropriate
mapping to product, process, systems, business lines etc. relevant for use in
Indian Banking environment.
3.2.2 External Loss database shall carry comprehensive information to facilitate
adjustments and scaling.
3.3 KRI Database
3.3.1
Provide Key Risk Indicators database in a structured manner with appropriate
mapping to product, process, systems, business lines etc. and shall be relevant
for use in Indian Banking environment.
3.3.2 Key Risk Indicators database shall have comprehensive information required for
effective implementation.
4.0 Key Risk Indicators (KRIs)
4.1
System should enable the authorized users to create new KRIs and edit as well as
map existing KRIs. The system should also be capable to interface with multi data
source systems (such as CBS etc.) and extract the data from the same in an
automated manner.
4.2
Provide for the upload of data manually as well as download of data to various
file formats such as word, excel, pdf etc. The data upload includes KRI calculation
data at defined frequency and data related to KRI definition and assignment. For
upload of data, bidder should provide the templates.
4.3
Definition of the KRI in the system should be independent of its assignment to
various risk entities so that one single KRI can be assigned to more than one risk
entities as per applicability.
4.4
The system should have the ability to upload, plan and facilitate the process,
track and report KRIs based on the different threshold decided by the Bank on a
firm-wide basis.
4.5 The system should allow responsibility and accountability for KRI monitoring to
bank personnel across branches.
4.6 The system should allow assignment of accountability to each KRI and list out
underlying common risk factors for the KRIs. System should also be capable of
CANARA BANK
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Sr. No. Operational Risk Functional Requirements
estimating/quantifying loss events based on the scenarios for underlying risk
factors.
4.7
The system should have the ability to take values from different users and
consolidate them at various levels such as business function, location and
business line.
4.8
The system should be able to generate reports such as dash board, tabular,
graphical etc. for risk entity, region, zone, bank and group and analyze trends
based on logic approved by the Bank.
4.9 The system should allow setting up KRI specific tolerance threshold limits.
4.10 At the time of monitoring, if a KRI values exceed the set threshold, then the KRI
should be classified into risk zones like red, amber, green etc.
4.11 System should cull out continuous red (high) and amber (medium) risk indicators
and automatically intimate the person responsible for that KRI.
4.12 The system should record, suggest and monitor action points arising out of red,
amber and green indicators with agreed timelines.
4.13 The system should be able to follow up (as per escalation matrix) for unresolved
action points and generate status report for the same.
4.14 The system should allow reassessment/validation of indicators and thresholds. It
should allow setting different thresholds for different risks.
4.15 The bidder should extend assistance in customizing various reports and MIS.
4.16 The system should permit selecting the data points to generate various reports
and MIS for each KRI monitoring.
4.17 The system should allow setting of different monitoring frequencies (weekly,
monthly etc.) for each KRI.
4.18 Trigger/ breaches should be mapped with various level of automated notification
and escalation across hierarchies e.g. through emails, sms etc.
4.19 The system should provide templates to collate data from processing units for
identified Key Risk Indicator components for date to be sourced manually.
4.20 The system should permit entering of KRI data manually from front end as well as
via flat file upload.
4.21
The system should have an algorithm for converting KRI data monitored across
branches, units, geographies into risk scores. The algorithm should also provide
for aggregating risk scores across business lines, geographies, branches and
CANARA BANK
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Management Architecture
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Sr. No. Operational Risk Functional Requirements
provide risk scores at different levels for comparison.
4.22 System should provide a report highlighting the risk profile of business lines
based on the KRI framework and across past year.
4.23 System should generate reports for KRIs which is in the high-risk zone and the
businesses where these risks are at high levels.
4.24 System should have report for monitoring and comparing KRI values across
different branches/geographies/business units.
4.25
Definition of KRI with its mapping with various dimensions and classifications e.g.
KRI name, description, mapping with process, activity, product, risk entity, risk
event type classification, unit of measurement, calculation criteria, data
attributes etc.
4.26 The bidder should assist by conducting a sample run of the KRI process as per the
Bank specifications.
4.27
System should provide for comparison of KRI results with benchmarked KRIs
along with capturing of benchmarked KRI in the system itself. Benchmark could
be industry, peers, or others.
4.28
System should provide facility to assign KRI to various risk entities with
specification of threshold, triggers, calculation frequency, and KRI review
frequency.
4.29 Compute KRI value as per defined frequency based on the data uploaded.
4.30 On the KRI review frequency, allow changes to be done after validation of KRIs
such as whether that particular KRI is relevant or to be discontinued.
4.31
Action plan should include information such as task to be done, original target
date, revised target date, number of revisions done in the target date, owner for
action plan, link with the respective risk event etc.
4.32
Generation of reports at multiple dimension such as for individual KRI level, risk
entity level, business unit, KRI sensitivity level (e.g. High, Medium, Low), region /
zone / bank / group level, risk type, product, process etc.
4.33 System should provide for configuration of ad-hoc reports required by the bank
over and above standard report in the system at no extra cost to the bank.
CANARA BANK
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Management Architecture
under Basel II & Basel III.
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Sr. No. Operational Risk Functional Requirements
4.34 System should enable computing an overall KRI index by aggregating results of
KRI monitored.
5.0 Loss Data Management
5.1
System must support all the requirements of RBI and Basel II with respect to
internal and external loss data management in terms of operational risk
management as well as measurement / modeling.
5.2
Loss Data Module should be comprehensive to record all the information for the
purpose of operational risk management as well measurement as per advanced
measurement approach. Management of loss event also includes capturing
intermittent status of risk event such as investigation status, recovery status, so
that end to end flow of risk event can be monitored for its progress and closure
i.e. capturing the life-cycle of loss event.
5.3 It should have download and upload facility for loss risk events in a specified
template.
5.4 System should have facility to capture near-miss events, gains arising from
operational risk loss event and opportunity cost.
5.5 System should be capable of being customized to bank's loss data management
framework, template, work-flow, reports.
5.6 It should be able to capture loss data from all geographies and departments of
the bank including overseas operations.
5.7 It should be able to migrate the existing internal loss data of the bank through
upload facility.
5.8 It should have strong internal controls around loss data such as, restricted access,
viewing or printing rights, audit trails, exception reports etc.
5.9 It should be able to do scaling, judgment overrides or other adjustments to the
loss estimates.
5.10
Information with respect to risk event should be captured such as date of risk
event occurrence, event end date, date of discovery,
date of providing contingent liability, date of accounting / provisioning,
description of risk event, location, product, process, risk
entity, root-cause analysis (RCA), causal factors, risk drivers, mapping with
business line and loss event type as per Basel II classification, bank’s internal
classification etc.
CANARA BANK
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Sr. No. Operational Risk Functional Requirements
5.11 System should flag events as loss event, near-miss, external loss data, operational
gain and opportunity cost1 for distinct identification of each entry.
5.12 It should enable identification of related loss events over time i.e. grouping of
related loss events over a period of time.
5.13
It should have facility to arrive at the Gross Loss inter alia including any direct
charges to reserves due to operational losses, all
expenses incurred as a consequence of operational risk events, provisions made,
penalty and fines etc.
5.14
System should differentiate the status of loss such as estimated, contingent
liability, provision made, loss accounted for with appropriate GL reference, Cost /
Profit Center, currency.
5.15
It should record loss type such as Legal Cost / Regulatory Penalties / Loss or
Damage to Assets / Restitution / Loss of Recourse / Write
Downs.
5.16 Loss information should include type of valuation such as book value,
replacement cost, Mark to Mark (MTM) etc.
5.17 Allocation of losses to business lines and loss event type categories as defined by
RBI/Basel II guidelines along with the methods used to allocate the losses.
5.18 It should enable classification of risk events as boundary events to specify it as
credit risk related or market risk related.
5.19
It should be able to record recovery from all sources (from insurance and other
recovery such as from employees, third parties, customer etc.) with clear
identification.
5.20 System should enable tracking of status of recovery such as recovery process
initiated but yet to be received.
5.21 It should be able to produce loss as gross loss, loss net of all other recoveries
other than insurance, loss net of all recoveries including
1 Opportunity costs/lost revenues would mean operational risk events that prevent undetermined future business
from being conducted (e. g. unbudgeted staff costs, forgone revenue, and project costs related to improving
processes), are important for risk management but not for quantification.
CANARA BANK
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Sr. No. Operational Risk Functional Requirements
insurance etc.
5.22 It should be able to identify the risk events which are covered in the existing
operational risk insurance policies.
5.23 It should facilitate creation of action plan with reference to the loss event.
5.24 System should have the ability to identify sufficiency of data in each of the cell
(8x7 matrix) and flag off such business line & risk type combination cells.
5.25
Action plan should include information such as task to be done, original target
date, revised target date, number of revisions done in
the target date, owner for action plan, link with the respective risk event etc.
6.0 External Loss Data Management
6.1
System should also facilitate, where relevant, the use of external data to enhance
scenario analysis, fit severity distributions or benchmark operational risk
exposure results.
6.2 External loss data should be separately identifiable in the system.
6.3
System should be able to capture information w.r.t external loss data including
actual loss amount, information on the scale of business operations where event
occurred, information on the cause and circumstances of the loss events, or
other information that would assist in assessing the relevance of the loss event of
the bank.
6.4 External loss data from all sources e.g. public data / pooled industry data /
vendor data, should be supported by the system.
6.5
System should be able to do scaling, adjustments (qualitative as well as
quantitative). The scaling process should be systematic, statistically tested and
generate outcome consistent with the operational risk profile of the bank.
6.6
System should facilitate appropriate filtering process to ensure the relevance of
data. The filtering process should be applied consistently and any exceptions
thereto should be documented and supported with rationale.
6.7
It should facilitate validation of loss data through multiple levels of reviews and
approvals e.g. maker-checker and there can be more than one level of review and
approval.
6.8 It should facilitate reconciliation of loss data with other source data such as GL
entries etc.
CANARA BANK
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Sr. No. Operational Risk Functional Requirements
6.9 System should have a comprehensive analysis and reporting mechanism for
review and monitoring.
6.10 It should be able to analyze data on multiple dimensions such as risk entity,
product, process, business lines, risk type, causal factor, and risk drivers.
6.11 Analysis should include trend analysis, comparison with past data and peer data.
6.12 Apart from standard reports in the system, it should also configure ad-hoc
reports required by the bank.
6.13
The system should have the ability to seamlessly incorporate the external loss
data received from CORDEx and differentiate internal loss event from external
loss data. It should facilitate to record all the data points required for external
loss data including information required to do the scaling / adjustments.
6.14 The system should be able to generate report/ data in the format provided by
CORDEx.
6.15 User should be able to extract the data based on applied filters e.g. loss between
a particular period.
6.16 Reports should be in all formats tabular, graphical, dash-board, heat map etc.
6.17
Reports should be with drill-down facility up to the most granular level including
loss information into 8*7 matrix of loss types and business lines in order to model
the operational loss distribution for the entire 56 operational risk cells.
7.0 Action Plan
7.1 System should provide for recording of action plan as part of RCSA, KRI, Loss
Data, External Events etc.
7.2
Action plan should capture information such as task, start date, original target
date, revised target date, number of revisions done, reason for revision, owner,
action plan type (long terms/ short term/medium term), status, reference of risk
event / KRI / Loss event due to which it was raised.
7.3 It should provide a direct link to the respective RCSA, KRI and Loss Data module
when action plan is required to be created as well as direct access to the module.
7.4 It should facilitate creation of action plan without any reference to a particular
risk event, KRI and loss event.
7.5 System should generate reports on the status, action plan which has breached
timelines, with open status, owner by action plan, risk entity / unit wise etc.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 131 of 250
Sr. No. Operational Risk Functional Requirements
7.6 It should be able to customize bank specific reporting requirements at no extra
cost to the bank.
8.0 Business Line Mapping & Capital Computation under TSA
8.1 The system should have the capability to map the existing Organization Structure
to the relevant Business Line as per Basel-II guidelines on TSA.
8.2 System should be able to map all activities of the bank into the eight level 1
business lines in a mutually exclusive and jointly exhaustive manner.
8.3 The system shall also be capable to map the activities of the bank into level 2 & 3
mapping as envisaged by RBI.
8.4
When mapping gross income, if an activity cannot be mapped into a particular
business line, then the system should be capable of using an objective mapping
criteria in accordance with the Basel II guidelines.
8.5 System should be capable of defining the mapping of any new activities or
products introduced by the bank.
8.6 System should be capable of generating reports as envisaged by management.
8.7 The bidder should extend assistance in customizing various reports and MIS.
8.8 The bidder should also extend assistance by conducting a sample run of the
Business Line mapping process as per the Bank specified process.
8.9 System should allow the user to extract the data based on applied filters e.g.
Gross Income mapping for a particular period.
8.10
System should be able to compute gross income for different business lines as
per Basel II / RBI guidelines for TSA, by interacting with data warehouse or other
source systems.
8.11 System should incorporate validation checks such as reconciliation of income as
per GL/FS with income considered for capital computation.
8.12 System should be able to store documentation containing the rationale for
mapping of Income codes appearing in GL.
8.13 System should be able to calculate the operational risk capital as per RBI’s TSA
guidelines by applying the Beta % prescribed by RBI for each Business line.
9.0 Scenario Analysis
9.1 Systems should facilitate scenario analysis of expert opinion to evaluate its
exposure to high-severity loss events e.g. including macro-economic scenarios for
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 132 of 250
Sr. No. Operational Risk Functional Requirements
calculation of operational risk capital and for operational risk management.
9.2 The system should support development of scenario related models under the
scenario based approach.
9.3 System should facilitate use of assumptions in scenario analysis based on
empirical evidence.
9.4 System should also facilitate review and validation of scenarios.
10.0 BEICFs
10.1
Solution should provide various methods for the identification and assessment
of Business environment and internal control factors and combining results
thereof by using bank’s existing operational risk management framework and its
implementation results such as RCSA (Risk and Control Self-assessment) results,
KRI results and Audit Review findings, etc.
10.2
Solution should support flexibility for use of BEICF directly or indirectly in the
capital calculation process :
as upward / downward adjustment to operational risk capital
indirect input to the scenario analysis process
Solution should have capability of calculation of capital before and after
consideration of BEICF factors.
11.0 Capital Computation under AMA and Modeling
11.1
Solution should consider all four elements required for operational risk
measurement namely internal loss data, relevant external operational risk data,
Scenario analysis and Business Environment and Internal Control Factors
(BEICFs).
11.2
Solution should have ability to suggest an optimum mix of four elements using
statistical techniques by analyzing the available data points with a credible,
transparent, well- documented and verifiable approach for weighting the
estimates of the AMA elements in overall calculation dataset used.
11.3 Solution should have flexibility for changing the weightages of AMA elements
suggested by the system and provision for documenting rationale for the same.
11.4
Solution should provide capability to scale and adjust the external loss data
(either public data and/or pooled industry data) using acceptable statistical
techniques before it can be used for modeling.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 133 of 250
Sr. No. Operational Risk Functional Requirements
11.5 Solution should provide flexibility for making Operational Risk Categories
2 (ORCs)
sufficiently ‘granular’3 as per the capital computation framework of the Bank.
11.6 Solution should be able to provide options for the choices of ORCs from the
available loss data set and homogeneity of risk within an ORC.
11.7
Based on this granularity determination for ORCs, Solution should be able to
model one or more appropriate de minimis gross loss thresholds. The thresholds
shall be determined across business lines or loss event types, for the collection of
internal loss data as per RBI / Basel II.
11.8
Solution should provide capability for the allocation of capital to business lines,
RAPM (Risk Adjusted Performance Measurement) and RAROC (Risk Adjusted
Return on Capital).
11.9
Solution should provide capability for performing Exploratory Data Analysis (EDA)
for each of the ORCs to get an idea of the statistical properties of the data and
select the most appropriate distribution.
11.10 Solution should provide capability for using estimation techniques to fit the
operational risk models to historically available operational loss data.
11.11
Solution should provide capability for using goodness of the fit testing for the
chosen distribution using visual test such as Quantile-Quantile Plots (Q-Q), Mean
Excess Plots, Autocorrelation Plot, Hill Plot estimations
Common formal tests for the goodness of fit could be but not limited to
Likelihood Ratio Test, Chi - square test, Maximum-likelihood Estimation (MLE),
Kolmogorov - Smirnov Goodness of fit test, Anderson-Darling Test, Cramer-Von
Mises Test, Quantile Distance Estimation method
11.12 Solution should display the parameters that are used for fitting the distributions.
It should rank and report all the test statistics.
11.13 Solution should provide capability for using statistical techniques for estimation
2An Operational Risk Category (ORC) or unit of measure is the level (for example, organizational unit, operational loss event type, risk category,
etc.) at which the Bank's quantification model generates a separate distribution for estimating potential operational losses. This term identifies a
category of operational risk that is homogeneous in terms of the risks covered and the data available to analyze those risks. Within ORCs losses
are independent and identically distributed
3Sufficiently granular (as defined by RBI) means the number of ORCs are neither too few nor too large, to capture the major drivers of operational
risk affecting the shape of the tail of the loss estimates
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 134 of 250
Sr. No. Operational Risk Functional Requirements
of information criteria such as Akaike Information Criterion (AIC) and Bayesian
Information Criterion (BIC).
11.14 Solution should provide capability to conduct parametric and non - parametric
bootstrapping process.
11.15 Solution should provide capability to calculate risk measures separately for each
ORC.
11.16 Solution should have provision for commonly used frequency distribution such as
but not limited to the poisson, binomial and negative binomial distribution.
11.17
Solution should provide commonly used severity distribution such as but not
limited to Gamma, Lognormal, Weibull, Pareto, Generalized Pareto and
Generalized Pareto distribution (with Block Maxima Model and Peak Over
Threshold Model):
Solution should have capability for considering and adjusting the positive
skewness and leptokurtosis of the data, when selecting a severity distribution.
Solution should provide for Single Severity Distribution and Piece-wise
Distribution.
11.18 Solution should be able to generate appropriate body-tail modeling threshold for
modeling the body and tail of the loss distribution separately.
11.19
In the case of heavy tailed data, Solution should have capability for using sub-
exponential distributions whose tails decay slower than the exponential
distributions.
11.20 Solution should provide capability for using models recognized by the Extreme
Value Theory (EVT) for treating the distribution of very high quantiles of data.
11.21
Solution should be able to compute aggregate loss distribution with appropriate
methods such as but not limited to Monte carlo-simulations, Panjer's Recursive
Method, Fourier Transforms and Single Loss Approximation. Simulations,
numerical or approximation methods may be necessary to derive aggregate loss
distributions.
11.22 Solution should be able to model the correlations/ dependence
4 between various
ORCs in order to get the diversification benefit of operational risk exposures
4The term dependency would be broadly interpreted to mean any form of dependency (e.g. linear or non-linear, relating to all the data or just to
the body or the tail) across two or more operational risk classes, caused by internal and/or external factors
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 135 of 250
Sr. No. Operational Risk Functional Requirements
across various business lines and loss event types using various methods
including but not limited to Copulas.
11.23 Solution should be able to estimate diversification benefits factored in at the
group-wide level or at the Banking subsidiary level.
11.24
Solution should be able to capture insurance policy data helpful in establishing
the eligibility of the insurance as risk mitigant for operational risk. Data could be
details of insurance policy, risks covered, minimum claims paying ability rating,
initial term, residual terms, minimum notice period of cancellation, insurance
provider being a third party and the uncertainty of claim payment.
11.25
Solution should be able to map insurance coverage to the exposures in Bank's
operational risk profile. Mapping is required to generate an estimate of the
probability of insurance recovery and the possible timeframe for receipt of
payments by insurers.
11.26 Solution should be able to map insurance policies to Basel II event types for risk
mitigation.
11.27
Solution should be able to calculate capital on a gross- and net-of-insurance basis
for each capital calculation, and possibly at a level of granularity such that
termination of any one policy could be immediately recognized for its effect on
capital.
11.28 Solution should provide capability for the validation of the AMA measurement
model through back testing, statistical testing.
11.29
Solution should have provision for sensitivity analysis of the Bank's ORCC
(Operational Risk Capital Charge) to change in modeling choices, assumptions
and data inputs (including internal data, relevant external operational risk data,
scenario analysis, and business environment and internal control factors).
11.30
Solution should be able to conduct empirical analysis of data (where the
modeling is primarily based on internal and external data) to be used in model
validation.
11.31 Solution should have capability for applying robust statistical techniques to test
the reasonableness of the assumptions about the underlying distributions.
12.0 Model Validation
12.1 The system should have the capability to implement a Bank defined verification &
validation process and should fulfill all audit and compliance requirements.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 136 of 250
Sr. No. Operational Risk Functional Requirements
12.2 The system should be able to incorporate the process flow as mentioned by the
Bank.
12.3
The system should have the capability to initiate the verification & validation
process and track the progress of various process steps as per the timelines
provided by the Bank.
12.4 The ORMS should be validated by independent third parties to ensure it is
compliant with RBI guidelines.
12.5 System should provide all the information as may be required for independent
review of operational risk management framework (ORMF).
13.0 Analysis and Reporting
13.1 System should have a comprehensive set of reports for all the stakeholders.
13.2 Report should be of all types such as graphical, heat-map, dashboard, tabular etc.
with drill-down facility to the most granular level.
13.3
Reporting should have flexibility to be generated using multiple dimensions and a
combinations of them such as risk entity, legal entity, geography / location,
process, product, risk type etc.
13.4
There should be some pre-configured standard reports for each of the modules
as well as a consolidated risk profile which can be created at various dimensions
such as branch / region / zone / bank / group etc.
13.5 System should be flexible to configure ad – hoc reports in the manner and form
required by the bank at no extra cost to the bank.
13.6 It should support both regulatory as well as management reports such as risk
profiling of branch, region, zone, bank, group.
13.7
Reports should cover qualitative i.e. results of operational risk management
processes and quantitative i.e. capital calculation processes and combination of
them.
13.8
It should provide for a robust analytical framework through comparison of RCSA,
KRI and Loss Data results, capital consumption vis a vis risk experience, trend
analysis, comparison with peer banks etc.
13.9 It should provide facility to access, view, download and print the reports as per
user access rights.
13.10 Report should be downloadable in excel, word, pdf etc. file formats.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 137 of 250
Sr. No. Operational Risk Functional Requirements
13.11 Operational Risk Management and Measurement Reports should be generated
across multiple dimensions such as ORM capital across each business line etc.
13.12 System should facilitate an effective risk reporting system as per the Pillar III
disclosure requirements of RBI guidelines on AMA.
7.2 Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for successful
implementation of the offered Solution, in the format specified in Annexure 11.4 Technical Bid
Format sub section 11.4.6.
Sr. No. Module/ Item Module Description Requirement Quantity
Note: The hardware and infrastructure sizing should be done with a user base of 1500 users for
ORMS with a scope of annual growth of 15 – 20% for next 7 years.
7.3 Training Requirements
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.7.
Sr. No. Requirements
1 How many Implementation trainings (ORMS) have been undertaken by the
Bidder so far?
2 Please provide a brief description on the Training approach taken by the
Bidder.
3 Please provide the following details for training :
3.1 Number of man‐days / duration for completion of training
3.2 Optimum batch size
3.3 Total efforts for conducting the training
3.4 Location
3.5 Frequency of training offered
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 138 of 250
Sr. No. Requirements
3.6 Pre‐requisites / Preparations required before training
4 Please answer the following about the trainers in‐charge of conducting the
training on behalf of the Bidder for the Bank:
4.1 Median experience of all trainers with the Bidder who would be involved
with the Project
4.2 Median experience of all trainers involved with the Project, working /
training on the solution proposed by the Bidder
5 Please provide a sample training response and feedback from previous
implementations
Also, please give details of the following:
5.1 Name of the Bank where product was implemented and the training
conducted
5.2 Date and place where training conducted
5.3 Training audience
5.4 Indicative rating [if any provided] Note: Please attach the feedback in a
separate document with proper cross‐referencing
6 Please specify the various modes through which the training will be
delivered? [e.g. Classroom training, Online self‐help training modules
within application / e‐learning modules, Quiz, etc.]
7.4 Project Management Methodology
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.8.
Sr. No. Requirements
1 Details of methodology / approach
The methodology section should Adequately address the following stages of
the project:
1.1 Frequency and approach for periodic reporting on the progress of the project
and actual status vis‐ à‐vis scheduled status
1.2 Detailed Study of Current State, with detailed work steps and deliverables
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 139 of 250
Sr. No. Requirements
1.3 Gap analysis including identification and resolution of gaps
1.4 Customization, development and necessary work around
1.5 Building up of interfaces with various applications currently used by the
Bank
1.6 Setting up of the data center and the disaster recovery site
1.7 User acceptance testing
1.8 Planning for roll‐out and identification of key issues that may arise along with
proposed solutions
2 Timelines
3 Project management activities
4 Roles and responsibilities of proposed personnel both from the bidder
5 Following details with respect to the methodology followed by the bidder in
Project Management for a Public Sector/Private Bank of comparable size/
complexity of operations as that of Canara Bank
5.1. Project Name
5.2. Project Location
5.3. Client Name
5.4. Client address
5.5. Client contact/reference person(s)
5.6. Project started (month/year)
5.7. Project elapsed time – months
5.8. Man‐months effort
5.9. Project Size (No of branches, modules covered and any other relevant
details)
5.10. Name of senior project staff
5.11. Nature of the Project
5.12. Project Management Methodology used
5.13. Role of the Bidder, whether complete end‐to‐end involvement or for a
particular module
5.14. Project detail (Broad detail – information about all activities handled, modules
forming part of the Operational Risk Project of the Client Bank, associated
activities, time lines activity‐wise and module‐ wise may be detailed.)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 140 of 250
8. Functional Requirements for Market Risk
The Bank aims to migrate to the Internal Models Approach (IMA) for Market risk Management
as per Basel-II / RBI guidelines. This approach will allow the bank to use risk measures derived
from their own internal market risk management models. The solution should be able to
compute capital charge for losses in on-balance sheet and off-balance sheet positions arising
from movements in market prices. The IMA solution should also be able to perform back
testing, stress testing, calculate specific risk VaR and Incremental risk VaR requirements as per
Basel-II, Basel-III and RBI guidelines.
8.1 Functional Requirements for Market Risk under IMA
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format sub section 11.4.9
8.1.1 Scenario Generation
Sr. No. Market Risk Functional Requirements
1 Set-up of Scenarios
1.1 support configurable shifts in at least the risk factors specified in Sub-Section8.6.1
: List of Risk Factors
1.2 configure differential shifts for subsets of positions within each risk factor, e.g., for
stress testing apply a 100% shift to current spread for AA Banks, 100 bps shift in
“XY” PSU Bond, 35% shift to BB Corporate bond spread, etc.
1.3 support application of a decision tree of business rules/ logic that should be
applied in selecting which shift is used, e.g., an “XY” PSU specific shift overrides a
generic PSU shift
1.4 allow user to select from a standard set of scenario parameters to generate a
scenario set
1.5 allow user to set appropriate time periods for the historical scenarios defined. The
user should be able to select start and end dates for historic price data download,
and alternatively specify a start or end date and a time period defined in business
days
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 141 of 250
Sr. No. Market Risk Functional Requirements
1.6 allow user to map new/existing risk factors into existing/new scenario generation
models
1.7 support shift in other calculation parameters: change in the holding period to
reflect systemic market liquidity reduction, change in time horizon (number of
historic data points) for evaluation of risk parameters, spreads over benchmark
curves and between market curves., etc.
1.8 express shifts as: percentage, absolute and other custom defined formula (basis
point parallel shift, etc.)
1.9 model correlations between risk factors
1.10 capture non-linear behavior of options and other relevant products (e.g.,
mortgage-backed securities, tranched exposures or nth-to-default credit
derivatives)
1.11 provide flexibility in scenario building on idiosyncratic, portfolio-level or market-
wide shifts
1.12 allow user to relatively weight time series data, e.g., attach a higher importance to
recent historical observations (E.g., t-0 to t-60 days) than to observations further
back in history (E.g., t-400 to t-450 days), in the case of historical scenario analysis
1.13 name and save sets of standard scenarios for easy retrieval. E.g., A “2007-2009”
scenario that stores the configuration required to test today’s portfolio with 2007-
2009 prices.
1.14 regenerate time series based scenarios (E.g., dates for start and end of time series,
set of risk factors for which scenarios are to be generated, etc.)
1.15 generate (pseudo) random numbers based on a user-defined seed value for the
purpose of generation of scenarios. The number set should be uniformly
distributed, of sufficiently long periodicity and should not exhibit significant
correlation or clustering
1.16 configure pre-defined reports to run pre-defined scenarios and automatically run
the process to generate reports at set times (E.g., End-of-week, End-of-month)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 142 of 250
Sr. No. Market Risk Functional Requirements
1.17 allow user to effect changes in scenario generation models (in line with access
rights), including but not limited to:
set up new risk factors mapped into existing scenario generation models
set up new risk factors and incorporate into new scenario generation models
re-map existing risk factors to new scenario generation models
incorporate new scenario generation models in the system’s set of models
2 User Defined Scenarios
2.1 allow authorized users to alter standard scenario configurations available for use,
subject to access rights and audit trail
2.2 provide a list of scenarios to allow user to build composite scenarios
2.3 allow user to load standard scenario configuration parameters or user defined
scenarios, amend them and re-save with a new unique identifier, to allow quick
generation of scenarios. Such scenarios should be stored in the user’s profile
without affecting the master list of configured scenarios.
2.4 allow users to delete saved scenario configuration parameters for user defined
scenarios, according to permissions and subject to audit trail
2.5 allow import and export of scenario generation configuration from a consistent
standard format (XLS, CSV) file
3 Execution of Scenarios
3.1 allow users to 'force run' scenarios, working around errors and running as
completely as possible, then listing where errors occurred e.g. where a data issue
causes a number of scenarios to fail, the system generates the rest and lists the
failures, rather than stopping at the first failure. Accordingly, metrics of process
success and failure need to be defined in the system
3.2 run scenarios where multiple risk factors are changed/shocked simultaneously
based on user input to determine the combined effect on selected or bank-wide
portfolio
3.3 compute the results of thousands of simulations over hundreds of time-steps in a
reasonable amount of time (fast enough to allow intra-day computations)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 143 of 250
Sr. No. Market Risk Functional Requirements
3.4 raise exceptions in the event of a breach of stress testing limits
3.5 display results using drill down capabilities. E.g., the paths that led to breach
scenarios.
3.6 display graphic and tabular representation of scenarios and scenario results to
allow user to interpret results of the simulation and present the same in reports
3.7 allow export of scenario output data to file as well as export all data contained
within the system to standard formats (CSV, XLS, etc.)
4 Scenario Generation for VaR computation
4.1 Historical Simulation
4.1.1 support multiple historical “look back” periods (e.g. 300 days)
4.2 Monte Carlo Approach
4.2.1 provide flexibility in definition of stochastic processes (e.g. Geometric Brownian
Motion, Mean reversion etc.) for the risk factors/risk factor groups in the Monte
Carlo simulation
4.2.2 provide for variance-reduction techniques (E.g., common random numbers,
antithetic variates, control variates, importance sampling, stratified sampling) to
enhance precision of simulation results
4.2.3 display Monte Carlo simulation results leading to losses greater than a certain
amount (user definable) in order to provide a better understanding /
interpretation of the market conditions that could generate such losses
4.2.4 define the number of Monte Carlo risk factor scenarios to be simulated
4.3 Parametric/Variance-Covariance Approach
4.3.1 adjust the variance/covariance matrices using standard approaches (e.g.
Rebanato) to maintain positive semi-definiteness
4.3.2 allow user to set parameters to: incorporate volatilities and correlations data sets
from external source, calculate volatilities and correlations based upon selected
historical periods using industry standard methods (e.g. unweighted approach,
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 144 of 250
Sr. No. Market Risk Functional Requirements
exponential weighted moving average approach)
4.3.3 calculate volatilities for risk factors using: relative price changes, absolute price
changes and logarithmic price changes
4.3.4 apply different volatility estimators and models: moving averages, exponential
with definition of Decay Factor, GARCH and Stochastic Volatility approaches
4.3.5 calculate undiversified / diversified VaR to allow for risk factors correlations
contribution
4.3.6 allow selection of type of interest rate sensitivities to be used (e.g. ”par” rates or
zero coupon rates)
8.1.2 Curve Generation
Sr. No. Market Risk Functional Requirements
1 Yield Curve Generation
1.1 define multiple term structures, each made up of multiple tenor points, for a
satisfactory coverage of the various markets within a specific currency (libor, bond,
swap, etc.)
1.2 choose, assign, combine and link on the term structure the benchmark instruments
quoted on the market for various product types
1.3 allow user to view/modify the yield curve parameters and sources
2 Volatility Curve Generation
2.1 define multiple term structures, each made up of multiple tenor points, for a
satisfactory coverage of the various markets across all currencies, product types,
tenors and strikes to include the volatility smile effect and interest rate volatility
structures
2.2 choose, assign and incorporate benchmark instruments quoted on the market into
various tenor points of the term structure.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 145 of 250
Sr. No. Market Risk Functional Requirements
2.3 bootstrap market volatilities to generate at a minimum, the following implied
forward volatility surfaces:
Implied swaption volatility surface
Implied caplet/floorlet volatility surface
Implied FX volatility surface
Implied bond option volatility
Implied equity index volatilities
3 Market Data Calibration
3.1 infer missing data points and create continuous curve values out of distinct data
points by bootstrapping of curves by appropriate methodology (E.g., linear,
constant, cubic spline).
3.2 upload pre-calculated values from external applications/ sources
3.3 link missing data points to suitable proxy data
3.4 provide error handling capabilities to identify missing data and substitute with data
points derived either from proxy sources or from interpolation
3.5 backfill new market data time series from other available time series sources
3.6 calculate correlations and volatilities based on historical data (unweighted moving
average and exponentially weighted moving average)
4 General Requirements
4.1 quote and use Bid, Mid and Offer rates using both real time feed and manual input
to generate term structure curves
4.2 generate discount yield curves and to estimate yield curves from forward rates, as
may be applicable for some instruments/ markets based on data availability
4.3 handle negative rates that the data points that constitute the term structure (E.g.,
Treasury rates for maturities) may take
4.4 provide basic graphical term structures analysis for better understanding of market
conditions
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 146 of 250
8.1.3 Valuation
Sr. No. Market Risk Functional Requirements
1 provide multiple pricing mechanisms to value a wide array of products including,
but not limited to, the following:
Cash flow model (For all money market transactions, FX Forwards, FX Spot,
Forward Rate agreements, non-callable bonds, mortgage backed securities,
FX/Bond/Equity Index Futures, IR/CCY/FX/Basis Swaps)
Hull-white model (Callable bonds)
Black 1976 (IR Caps/Floors, Exchange traded options)
Garman-Kohlhagen (FX Options, Options on FX Futures)
Convexity adjustments (Interest rate futures)
Default intensity (Credit derivatives)
2 accommodate new instruments by allowing definition of new product types and
valuation characteristics (E.g., If RBI allows Banks to trade in a new instrument, the
user should be able to define the valuation methodology of the product)
3 configure and customize instrument parameters at the cash flow level
4 define a new instrument by inheriting the logic of its constituent instruments (E.g.,
If RBI allows Banks to trade in a new exotic instrument that can be broken down
into multiple constituent cash flows, the user should be able to define and link the
valuation methodology of the new instrument as an combination of the constituent
instrument valuation methodologies)
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5 provide valuation methodologies for:
Foreign Exchange Models (spot and forwards): Net Present Value, Marked To
Market
Interest Rate Models and Indexes: Net Present Value, Discount Curve, Forward
Estimation Curve, Index Yield Curve, Calibration to market
Fixed Income / Securities: Marked To Market, NPV from any yield curve, Fixed
spread over any yield curve, Fixed spread over Benchmark Bond
Structured Fixed Income: Net present value
Commodity Models: Marked to Market, Calibrate to market
Equity Models: Marked To Market
Common optionality models as relevant to bank: Marked to Market, Binomial,
Trinomial, Monte Carlo, Black – Scholes (BS), Cox - Ingersoll – Ross, Hull – White,
Garman – Kohlhagen
6 perform valuations in line with RBI requirements, using methodologies and data
from other sources (E.g., FIMMDA for bond valuations, FEDAI for Forex valuations)
as necessary
7 allow user to define different valuation models for the purpose of CVA and MTM
calculations
8 perform calculations on real-time or based on user-established triggers, on a batch
basis
9 algorithmically generate (pseudo) random numbers, for use in Monte Carlo pricing
computations and scenario generation exercises
10 allow definition of combination of different valuation models for valuation of
instruments
11 store valuation model parameters (created within the valuation models, or
derived/imported from elsewhere) internally and map these to transactions and
exposures as required at the time of valuation
12 interface with most available external third party pricing systems E.g., valuation
tools with subscribed price feeds that may be used by the bank for price
information
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13 display partial calculations results for reconciliation and model risk analysis (E.g.,
the user must be able to view intermediate steps in the pricing calculation that led
to the final result)
14 allow user to effect changes in pricing models (in line with access rights), including
but not limited to:
set up new instruments mapped to existing pricing models
set up new instruments and incorporate new pricing models
re-map existing instruments to new pricing models
incorporate new pricing models in the system’s set of models
8.1.4 P&L Vector
Sr. No. Market Risk Functional Requirements
1 Profit & Loss Simulation
1.1 calculate P&L as part of the overnight risk measurement process.
1.2 calculate P&L intra-day (e.g. to support limit management for stress limits).
1.3 calculate P&L for a selection of risk factor shifts, based on the following
parameterization:
Selected positions/portfolios
Sensitivity/Taylor based
Revaluation grid based
Scenario Set
Selected hierarchy node
1.4 calculate P&L based on user defined scenarios, standard stress scenarios and
macroeconomic scenarios at the local & business unit level and at the global level.
1.5 allow user-defined scenarios to override-adjust historical pattern assumptions (e.g.
special events)
1.6 allow a scenario to be quickly 'test run' on a configurable set of records, for
example, the top 500 positions.
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1.7 decompose P&L into the constituent risk factors responsible for the net trade or
portfolio value change: IR Delta P&L, IR Gamma P&L, FX Vega P&L, IR Vega P&L, IR
Time Decay (Theta), Trade events , New trades, Amended trades, Void trades
1.8 display and report Profit & Loss attribution using drill down and graphic capabilities
1.9 provide option to include as well as exclude transaction costs such as brokerage
fees, commissions and other fees in the P&L attribution exercise
2 Sensitivity Analysis
2.1 aggregate sensitivities across Business Units by any available attribute (e.g.
counterparty, currency pair, currency, tenor etc.) according to a defined
aggregation hierarchy.
2.2 convert sensitivities from across Business Units to a common standard (e.g.
common tenor structure) for aggregation
2.3 identify which risk factor a portfolio/subset of portfolio is most sensitive to / which
risk factor movements would have the biggest impact on risk measures.
2.4 allow the user to reverse sensitivities (i.e. multiply by -1) for incorporation in
relevant risk measurement models.
3 Aggregation
3.1 aggregate the calculated values of each asset in each scenario to generate the P&L
Vector for each scenario
3.2 generate correlated scenarios so that the final aggregated value of the P&L vector
is logically internally consistent
3.3 tabulate and graphically represent results of the P&L vectors generated for each
scenario
3.4 drill-down and identify break-up valuation of each component in a selected
scenario
8.1.5 Risk Computations
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1 support computation of all aspects of market risk covered in the Basel 2 Internal
Models approach, specified in Sub-Section 8.6.2 : List of Risk Measures
2 allow user to individually compute each measure of VaR as relevant to Basel 2 IMA:
Interest Rate Risk
General Market Risk
Specific Risk
Default Risk
Credit Migration Risk
Credit Spread Risk
Incremental Risk
Equity Price Risk
General Market Risk
Specific Risk
Exchange Rate Risk
3 Specific Risk
3.1 isolate spread risk, event and default risk for estimation of specific risk
3.2 report the amount of the incremental risk capital charge (IRC) not only with
confidence interval of 99.9 percent but also with confidence interval other than
99.9 percent as per RBI guidelines. It should be capable of generating and reporting
the default risk and credit migration risk separately
3.3 incorporate correlations between default and migration events in the IRC model
3.4 capture and measure Basis risk, i.e., identify material idiosyncratic differences
between similar but not identical positions (E.g., debt positions with different levels
of subordination and maturity mismatches). Capture significant basis risk which
may include mismatches between long and short positions by maturity or by the
issuer.
3.5 compute basis risks by product, seniority in the capital structure, internal or
external rating, maturity, vintage for offsetting positions as well as differences
between offsetting instruments, such as different payout triggers and procedures.
4 Stressed VaR
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4.1 calculate and report the stressed Value at Risk (sVaR) as per RBI guidelines.
4.2 identify the stressed VaR time series window, i.e., the 250 day period that
generates the largest VaR from a defined historical period (e.g., 1 Jan 2005 to
reporting date)
4.3 apply user-specified past price points, correlation and movements on the current
portfolio
4.4 evaluate stressed VaR at both transaction and portfolio level using the same
methodologies as used to compute normal VaR
4.5 store historical stressed VaR results and utilize in capital computation
8.1.6 VaR Analytics
Sr. No. Market Risk Functional Requirements
1 VaR Computation
1.1 calculate and report the total amount of the previous day interest rate risk VaR,
equity risk VaR, exchange risk VaR, commodity risk VaR, etc. for vanilla and
derivative instruments at different user-defined confidence intervals (E.g., 95%,
97.5%, 99%) for different user-defined holding periods
1.2 allow user to select products/deals/portfolios to be used in the VaR computation,
and compute VaR for the selected assets
1.3 calculate and report the 60 business-day average modeled VaR for all of the bank’s
portfolios
1.4 scale up the VaR to a higher number of days for both linear and non-linear products
using square root method
1.5 provide a breakdown of contribution to the overall VaR figure and compute the
distribution of VaR across various dimensions including:
Dealer wise VaR
Product wise VaR
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Market wise VaR
Desk wise VaR
Currency wise VaR
Risk wise VaR
1.6 revalue selected portfolios and recompute VaR, stressed VaR, back testing on an
intra-day basis
1.7 perform real time intra-day computations without impacting end of day process
1.8 report intra-day market risk against limits established in the system
2 Marginal VaR
2.1 compute the VaR impact of removal of a position /set of positions to the VaR of a
user-defined portfolio without recalculating bank-wide VaR
3 Component VaR
3.1 provide a decomposition of the VaR contribution of different asset types
4 Incremental VaR
4.1 compute the VaR impact of addition of a position/ set of positions to the VaR of a
user-defined portfolio without recalculating bank-wide VaR
5 Expected Shortfall
5.1 report all data points beyond the VaR thresholds, compute the expected shortfall
as the average
5.2 allow user flexibility to define the weight of each data point beyond the VaR
threshold to compute a weighted shortfall value
5.3 compute and report the expected shortfall as a line item in VaR reports
8.1.7 Pre-deal Check
Sr. No. Market Risk Functional Requirements
1 re-calculate risk measures based on the addition of new positions, or
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amendment/removal of existing positions, prior to actual execution of trades
2 add /remove a position to a specified portfolio and calculate risk implications for
the added position using latest available scenarios and valuations
3 compute the effect of a new trade on risk metrics of a user-defined portfolio
without the need for an actual execution of trade
4 retain and retrieve computational and result information in a database distinct
from the main data warehouse
8.1.8 Limit Monitoring
Sr. No. Market Risk Functional Requirements
1 report risk exposures against the following limits:
VaR limits
Gap/Tenor limits
Stop loss limits
Notional/Exposure/Product concentration limits
Net PV01/ Maximum cumulative PV01 limits
Interest rate vega/ cumulative IR vega limits
Greek limits: Gamma, delta, vega
Aggregate Gap Limits (Forex)
Intra-day Limits
Net Overnight Open Position
2 reports limit utilization against limits at various levels of hierarchy (E.g., book level,
desk level etc.)
3 report historical limit trends e.g. showing how a particular limit changes over time.
4 produce exception reporting related to compliance requirements, e.g. monitoring
authorization levels of individual traders' as the ability to trade certain products, or
within certain maturity limits, or the authorization for only buying bonds and not
selling
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8.1.9 Back Testing
Sr. No. Market Risk Functional Requirements
1 back test the dirty (including brokerage, commission, fees paid, capital gains taxes,
etc.) as well as clean (excluding aforementioned costs) P&L
2 maintain a history of P&L data value and allow users to view changes to P&L over
time
3 explain exceptions resulting from changes, modification or cancellation of trades
4 configure interval periods for comparing P&L and VaR
5 provision to test parameters by simulating VaR on historical portfolios and/or rates
6 support multiple regulatory regimes to allow multiple pricing and VaR
methodologies to be defined in the system simultaneously for different portfolios.
E.g., Historic 10-day VaR for Indian equities and Monte Carlo 5-day VaR for US
equities
7 store granular data (at the International Securities Identification Number level) for
at least ten years across all investment classes and derivatives
8 drill down and pinpoint specific securities, trades or portfolios that are contributing
to spikes and exceptions in the VaR figure
9 compute, aggregate and back test VaR across sub-portfolios. (E.g., for HFT
portfolio, for all assets denominated in USD, for central government securities
investments only etc.)
10 store information on the historical exceptions for a configurable period of time
11 classify the number of exceptions in green, yellow and red zones as defined by RBI
and report the same providing details on the exceptions
8.1.10 Stress Testing
Sr. No. Market Risk Functional Requirements
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1 provide a standard set of ready scenarios to reflect the stresses experienced by
banks’ portfolios mainly in Indian markets except in the case of foreign operations
where the local stress periods would be applicable
2 capture the changes in parallel and non-parallel shifts in the spot rates, changes in
convexity of the curves, changes in basis, etc. and measure the impact of the same
at trade level and portfolio level.
3 support performing stress tests at multiple levels e.g. firm level, trading book level,
portfolio and sub portfolio levels
4 run both local and global scenario generation exercises independently for stress
and scenario testing, without interfering data or processes for end of day runs
5 support performance of reverse stress tests on specific market risk inputs, to
identify scenarios where market risk limits are breached or large losses are
incurred
6 compare stress testing results against the start position
7 allow performance of global (Consolidated) and local (E.g., London) stress tests
independently
8.1.11 Capital Charge Computation
Sr. No. Market Risk Functional Requirements
1 Standardized Approach
1.1 capture all products, counterparty types, currency turnover information, exposure,
and classify/categorize them as per RBI guidelines on new capital adequacy
framework
1.2 allow business users to define/modify the customer type, product type etc., in line
with any regulatory guidelines.
1.3 facilitate application of appropriate risk weights for products (specific issues, short
term and long-term facilities, domestic and foreign currency facilities),
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counterparties (claims on banks, corporate, multilateral agencies, sovereign, state
govt.) etc. as per RBI guidelines.
1.4 support modification of the rating and rating agency details
1.5 capture and compute capital for non-performing investments (NPIs) as per the
relevant regulatory prescriptions
1.6 simulate the effects of various scenarios on the Bank’s risk weighted assets
1.7 compare the current capital charge computations with previous quarters
1.8 calculate and report the capital charge on account of specific risk and on account of
general market risk under interest rate, equity and foreign exchange and gold
1.9 capture the rating to risk weight mapping and perform capital calculation as
prescribed by the host supervisor for the claims in the books of the overseas
branches
1.10 mark the securities as illiquid and calculate amount of reduction to be applied
under the Tier 1 capital as per the RBI guidelines
1.11 account for deductions from the tier I and tier II capital as per RBI guidelines, while
arriving at the capital charge. (for e.g. if capital is already deducted for investment
in subsidiary the same may not be considered for calculation of capital charge)
2 Internal Models Approach
2.1 compute capital charge for “on and off balance sheet items” under IMA
2.2 compute the capital charge on a daily basis
2.3 generate all balance sheet disclosures related to treasury operations
2.4 compute capital charge as relevant to each portfolio (HFT, AFS) in line with RBI
regulations
2.5
calculate and report the total VaR for the bank’s entire portfolios (such that all
trading positions are included) that are calculated for internal reporting without
recognition of correlation effects across those portfolios
2.6 capture the changes in parallel and non-parallel shifts in spot rates, changes in
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convexity of curves, changes in basis etc.
2.7 calculate and report the capital charge on account of specific risk and on account of
general market risk under interest rate, equity and foreign exchange and gold
2.8
calculate and report the Total Capital charge for previous day, and during the
previous quarters under sub categories like interest rate, equity and foreign
exchange and should also calculate the total risk weighted assets and capital ratio
2.9 identify illiquid securities and accordingly report the amount of reduction to be
applied under tier 1 capital and mark the securities as illiquid
2.10 calculate the capital charge for investments in MFs
2.11 compute the “plus” or add-on factors based on back-testing exercises in line with
regulatory guidelines
2.12 provide flexibility of viewing the reports at aggregated or granular level
2.13 capable of accounting for deductions from Tier I and II capital
2.14 support a user configurable interface with which the business user can modify the
rating and Rating agency details
2.15 retain historical information on the capital charge on a daily basis
2.16
Provide capability for the allocation of capital to business units/ various portfolios,
Risk Adjusted Performance Measurement (RAPM) and Risk Adjusted Return on
Capital (RAROC)
8.1.12 Reporting Requirements
Sr. No. Market Risk Functional Requirements
1 Aggregation and Drill Down Functionalities
1.1 aggregate / breakdown information at any level based on static information (i.e.
trades attributes). including but not limited to: currency, counterparty, instrument
type, book, trader, branch, regions, asset/liability type, zone, and user-definable
attributes
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1.2 aggregate / breakdown information at any level based on dynamic information
(results categories) including but not limited to: NPV, delta, VaR. For e.g., the user
should be able to select all Indian equities which contribute a VaR of over INR
10,000. The securities present in this bucket are subject to change over time
1.3 display results in a multi-dimensional format ( e.g. excel pivot tables)
2 Report Customization
2.1 allow users to specify the exact layout of the required report including location of
fields, header, footer, page numbering, title etc.
2.2 allow users to define structures and fields of each report by selecting fields from
databases of their choice
2.3 provide a report writing wizard that provides users with step by step menus and
allows them to draw up reports in the required format (E.g., PDF, HTML, XLS)
2.4 allow users to present outputs from reports in the form of graphs, charts and other
graphical representations
2.5 sort data in reports
2.6 customize reports with user defined filters
2.7 customize reports with respect to time period considered, portfolios considered,
levels of granularity, etc.
3 Scheduling of Reports
3.1 generate pre-defined end-of-day, end-of week and end-of month reports
3.2 generate pre-defined reports with minimum user interference
3.3 define a schedule for reports and reports should be generated as per the frequency
defined by the Bank
3.4 allow defining the users to whom reports can be automatically sent
4 Archiving of Reports
4.1 archive historical reports
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4.2 archive historical rates extracted from market information systems
5 Ad hoc Reporting
5.1 allow users to customize standard reports for their own profile (E.g., different
portfolio, specific time period, comparing with historic results), without affecting
reports generated by other users
5.2 allow users to configure what-if analysis to analyze the impact of new positions,
amendments to existing positions, unwinding positions, etc.
5.3 allow user to extract any data stored in the system (position data, price data,
rating-wise historic FIMMDA ZCYC spread information etc.) for graphing and
analysis
6 General Requirements
6.1 generate all regulatory reports required in appropriate regulatory formats
6.2 provide pre-configured internal reports in standardized templates, for effective
market risk management.
6.3 allow user to configure and generate new ad hoc reports and save report
configuration in user profile
6.4 retain historic report information to compare report outputs over a configurable
time period (E.g., previous day or previous month end)
6.5 distribute reports according to user-configurable distribution parameters, e.g.,
email to a generic inbox, save to a server location, etc.
8.1.13 Data Requirements
Sr. No. Market Risk Functional Requirements
1 Market Data
1.1 Market Data Sourcing
1.1.1 capture price/volatility/spread data relating to a broad range of products from
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different data providers, to allow the Bank to record its current and likely future
treasury activities accurately, including, but not limited to, the following:
Fixed Income Investments (Central Government Securities, State Government
Securities, Other Approved/SLR Securities, Treasury Bills, Cash Management Bills,
Corporate Debt, Commercial Paper, Certificates of Deposit)
Stock Investments (Equity, Preference Shares and Mutual Funds)
Lending and Borrowing Operations (Repo Transactions, Reverse Repo Transactions,
Interbank Lending Operations, Central Bank Lending Operations, Call Money,
Notice Money, Refinancing operations - NABARD, SIDBI)
Over-the-counter and Exchange traded Derivatives (Exchange Traded Futures, IR/Fx
Swaps, Credit Derivatives, Cross currency swaps, Fx Options, Interest Rate Options,
Forward Rate Agreements)
1.1.2 allow addition of new market data sources. E.g., configure the system to obtain
equity price information from Bloomberg rather than Reuters
1.1.3 source time stamped market data (e.g., Open/ High/ Low/ Close) across multiple
markets, taking to account varying business hours
1.1.4 allow user to configure intraday timings for sourcing market data
1.1.5 allow user to configure change in market data source as either temporary or
permanent
1.1.6 allow user to configure alternative data source in case of failure of primary source
system (E.g., BSE prices when the NSE price feed suffers disruption)
1.1.7 obtain information from external sources on historic values of various risk factors
(E.g., equity index and individual equity prices, forex prices, commodity prices,
spreads over benchmark curves for Bank/PSU/FI/Corporate rated bonds, etc.)
relevant to market risk computations. Historic data for the last 5years should be
available.
1.1.8 configurable data sourcing timings for users in different time zones, e.g., London
branch should be able to download FTSE closing prices at the end of day, and head
office should be able to value London portfolio at the start of Indian business day
1.1.9 allow modification of input price/curve data as required by the pricing model, e.g.
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transforming quarterly quotes into monthly prices
2 Static & Reference Data
2.1 Static Data Sourcing
2.1.1 source reference data from relevant sources including:
Instrument reference data for (past, current and future) traded products. (E.g.,
Bloomberg/Reuters/FIMMDA ticker, Index constituents, etc.)
Internal Desk/Book hierarchy data
Product hierarchy data (e.g. relationship of asset classes, instruments and sub-
products
Counterparty data including a standardized, organization-wide counterparty
hierarchy
Calendar / business day conventions
Static data values (e.g. country codes, currency codes etc.)
2.1.2 allow definition of new reference data types and modification of pre-defined data
types (E.g., addition of a new level in the product hierarchy)
2.1.3 allow sources of reference data to be changed, and the reference data should have
an attribute identifying data source
2.1.4 support all types of day count basis including 30/360, Actual/360, Actual/365,
Actual/Actual, 30E/360
2.1.5 support International Swaps and Derivatives Association (ISDA) -defined business
day conventions such as following, modified following, preceding, next month, this
month, average of the month etc.
2.1.6 support user defined reprising to input changes in asset prices that do not flow
from data feeds
2.2 Holiday Calendars
2.2.1 load calendar schedules from external sources including but not limited to SWIFT,
International Holiday schedule and Bloomberg holiday schedule etc.
2.2.2 allow users to set calendar schedules through interfaces/ patch updates
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2.2.3 allow configuration of multiple holiday tables for each currency and country
2.2.4 allow users to input calendar schedules at least 7 years forward
2.2.5 edit and override global calendar and holiday tables
2.2.6 flag trades executed on a global holiday through exception messages and exception
reports
2.2.7 define settlement instructions based on emergency holidays
2.2.8 model cash flows and interest accruals based on holiday calendar and standard day
roll conventions
3 Position Data
3.1 retrieve position data from treasury system to perform valuations
3.2 allow user to create, save and load portfolios of bank’s position in various
instruments/ currencies
3.3 automatically recalculate the trade or portfolio value if (relevant) market rate
changes are detected
3.4 allow user, based on access rights, to create portfolios across all dimensions (E.g.,
Bank-wide, HFT/AFS/HTM, Trading Book, Commodity, Risk factor, individual
position, Trader, currency, delivery location, Trade type, Time bucket, etc.)
3.5 support different types of portfolio revaluation methodologies: marginal, full, no
recalculation, manual, timed (i.e. every 10 minutes, batch), etc., or any portfolio-
wise combination of the same.
3.6 provide various options to value the Bank’s investment portfolio: current market
rates, freeze current market rates (snapshot), etc.
3.7 facility to specify if portfolio should be loaded as of a specific date in the past
3.8 select Position / Price / Liquidation methodology for aggregated positions: Average
Cost, LIFO, FIFO, Max Profit, Least Profit, User defined
3.9 display information at trade and portfolio levels
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3.10 display valuation results using drill down capabilities (e.g. Local Currency, Base
Currency, Reference Currency)
3.11 display portfolio results, where possible, by a user definable maturity grid
3.12 bucket portfolio open positions into the maturity grid using industry standard
methodologies: Previous Bucket Point, Following Bucket Point, Proportional ,
Nearest, Delta Equivalent, Proprietary, etc.
3.13 create, name, save and load portfolio ‘views’ as result of the previous choices
3.14 provide Hedge Effectiveness Testing and Portfolio Optimization functionalities. I.e.,
the system should be able to compute the effectiveness of hedges as well as to
determine the optimal portfolio composition given various constraints (E.g.,
minimum/maximum investments in certain assets)
4 Data Upload
4.1 time stamp and record data source for each data upload
4.2 allow user to decide the frequency and mode of data upload, e.g., timed update or
continuous update
4.3 upload position, rate and valuation information of the investment portfolios of
local as well as overseas branches to allow consolidated reporting
5 Data Overrides and Adjustments
5.1 allow users to apply adjustments to address erroneous values via single point
changes or mass updates
5.2 log data corrections and communicate the same to relevant upstream/
downstream systems
5.3 maintain an audit trail of data changes made by users
5.4 allow reversal of changes made based on access rights given to different levels of
users
6 Data Validation
6.1 validate user entered data at the time of data sourcing, preferably by field input
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Sr. No. Market Risk Functional Requirements
controls, e.g., format of input, date checks, etc.
6.2 support configurable data checks on consistency and integrity of all data inputs
(market data obtained from different data providers, position data from treasury
systems, etc.). The checks should be configurable on single data points as well as
on groups of data, e.g., curves
6.3 support validation of uploaded data by means of business rules with configurable
parameters
6.4 ensure that there are effective checks and controls to ensure that transactions are
not loaded multiple times in the host system, i.e., duplication checks
6.5 perform data validation to reconcile position data in the treasury system with
market risk system
7 Data Storage and Archival
7.1 store on a daily basis the following information:
Position and transaction data at a granular level present in the Bank’s portfolio
Market data (yield curves, volatility curves, Fx Spot and Forward prices , FX
volatilities)
Market prices (for quoted instruments) and book value for instruments that are not
traded often
Net Present Values(NPV), MTM and Greeks at transaction and aggregated levels
Value-at-Risk at transaction and aggregated levels
Scenario Results at transaction and aggregated levels
Profit & Loss results at transaction and aggregated levels
7.2 import historical market prices files from external vendors for volatilities and
correlations calculations for transactions on new markets
7.3 import historical position information either directly from existing systems or in the
form of data upload files to allow easy system migration, generation of historical
results and also to mitigate the impact of incorrect data uploads
7.4 store historical market rates information through automatic end-of-day procedures
and historical results for at least 10 years
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Sr. No. Market Risk Functional Requirements
7.5 store the complete set of data used as input to calculations performed by the
system
7.6 allow users to view complete data snapshot of any previous business day
7.7 support storage of all current and historical position, market and reference data on
a daily basis, and allow users to view the complete set of data for any given day
7.8 store system-generated data points (e.g. interpolated values), with configurable
flags determining whether or not data is stored
7.9 transform data from source format to a standard format for storage/ archival
7.10 provide data mining functionalities (e.g. identifying from a set of historical data the
worst one month/quarter/year)
7.11 support archiving of data that are beyond a specified time horizon
7.12 export data to secondary storage device without down-time
7.13 support data retrieval from the specified archives. The archival and retrieval
programs should facilitate easier analysis of old data.
7.14 in-built Data warehousing capabilities or standard interface with Data warehousing
solutions
8 Data Quality and Statistics
8.1 provide an analysis of data quality, i.e., completeness and accuracy of inbound /
outbound data feeds and reporting on key data quality metrics
8.2 provide a tool for automatic verification and validation of uploaded data with
appropriate measure of correction
8.1.14 Model Validation
Sr. No. Market Risk Functional Requirements
1 provide an independent set of valuation methodologies to independently assess
the models used to price each asset in the Bank’s investment portfolio
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Sr. No. Market Risk Functional Requirements
2 allow user to run sample test cases in both the primary as well as independent
secondary pricing modules
3 compare primary and secondary model outputs and enable user to identify areas of
divergence
8.1.15 Miscellaneous Requirements
Sr. No. Market Risk Functional Requirements
1 track and account for the necessary range of traded and non-traded currencies that
can be configured by the user
2 convert between currencies without manual intervention to the home currency
3 support multiple organizational levels and relationships
4 permit entry of free format text (especially in case where the dealer wants to
provide additional settlement instructions during deal entry, dealer notes etc., and
that information has to be recorded in the risk management system.)
8.2 Functional Requirements for ALM System
The Bank intends to strengthen its ALM system processes by complying with all ALM DGA
requirements by RBI. This includes both RSA (risk sensitive assets) and RSL (risk sensitive
liabilities) and domestic/ overseas operations.
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format sub section 11.4.9.
8.2.1 Computation Requirements
Sr. No. ALM Functional Requirements
1 generate cash flows for rate sensitive assets and liabilities with or without
embedded optionality, by utilizing market or internal data, or by means of
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Sr. No. ALM Functional Requirements
behavioral analysis as appropriate.
2
bucket each rate sensitive on- and off-balance sheet asset and liability in line with
extant RBI guidelines for SLS, Interest Rate Sensitivity – TGA and Interest Rate
Sensitivity – DGA. Also allow user to define custom buckets for additional analysis.
3
compute coupon, yield for each bucket and the macaulay duration, modified
duration and modified convexity as applicable to each on- and off-balance sheet
asset and liability in line with RBI guidelines on DGA computation, incorporating
data from market sources as well as bank internal sources
4
evaluate the bank’s position with respect to various duration, maturity-mismatch
and any other limits established in the system by the Bank to monitor ALM
position across geographies, portfolios and jurisdictions
5 generate automated threshold alerts and drill-down reports on any breaches of
limits established in the system
6 allow bank to define new products, new coupon/yield computation logic and new
bucketing rules without extensive rework and recoding
8.2.2 Behavioral Analysis
Sr. No. ALM Functional Requirements
1
allow user to configure behavioral analysis using RBI guidelines, trend analysis,
historic data and user inputs for at least the following assets and liabilities with no
contractual maturity, from the perspectives of SLS and IRS reporting:
Current and Savings Bank Deposits
Overdue Deposits
Term Deposits
Bills Payable
Cash Credit and Overdraft (CC/OD)
Prepayment of Term Loans
Un-availed Portion of CC/OD/WCDL
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Sr. No. ALM Functional Requirements
Devolvement of LCs/Guarantees.
2
provide a choice of statistical models to analyze behavior of assets and liabilities,
including but not limited to, the following:
Drawdown analysis
Rollover analysis
Prepayment/Early redemption analysis
Past due analysis
3
back test behavioral analysis assumptions by means of industry standard tests
(Conditional coverage tests, unconditional coverage tests, duration tests, etc.), in
order to assess accuracy of expected behavior.
4 compare and tabulate expected versus actual historic behavior and enable an
analysis of reasons for deviation, if any
5 allow user to tweak behavioral study assumptions and provide estimates of
changed behavior to enable accurate recalibration
8.2.3 Liquidity Risk Monitoring
Sr. No. ALM Functional Requirements
1 Liquidity Risk
1.1
monitor daily risk positions through cash flow gaps and maximum cumulative
outflow measurements. Intra-day bank liquidity position and currency-wise open
position reporting included in this requirement.
1.2
generate and monitor all ratios relevant to liquidity, including but not limited to,
the following:
Liquidity Coverage Ratio and Net Stable Funding Ratio in line with RBI guidelines
on Basel III implementation
Market Value of unencumbered High Quality Liquid Assets (HQLA) required for the
bank to meet regulatory liquidity coverage ratio requirements
Actual vis-à-vis regulatory levels of CRR and SLR
Regulatory monitoring ratios:
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(Volatile liabilities – Temporary Assets)/(Earning Assets – Temporary Assets)
Core deposits/Total assets
(Loans + mandatory SLR + mandatory CRR + Fixed Assets)/Total Assets
(Loans + mandatory SLR + mandatory CRR + Fixed Assets)/Core Deposits
Temporary Assets/ Total Assets
Temporary Assets/ Volatile Liabilities
Volatile Liabilities/Total Assets
Impact of stress scenarios such as drying up of funding sources, increased market
volatility, bank-run, etc. on the bank’s liquidity position
Utilization against contingency plan triggers and limits
Any other ratio required by the Bank from the perspective of stock approach
liquidity management (Swapped Fund Ratio, Credit Deposit Ratio, Loan losses to
net loans, etc.)
1.3
allow user to configure liquidity ratios and trigger/limit levels through a graphic
user interface, defining the numerator and denominator out of bank balance
sheet inputs
1.4 provide an overall consolidated view of the total market liquidity risk faced by the
Bank by virtue of its current portfolio
2 Liquidity Stress Testing
2.1
possess a robust stress testing engine to simulate systemic and specific events
including but not limited to, the following
Deterioration in firm’s credit rating
Run-off of non-contractual liabilities using statistical approaches
Periods of combinations of sudden and prolonged market volatility
Greater than expected drawdown of non-fund based exposures
2.2 should be capable of analyzing the impact of concentration of funds by source,
borrowers and currency to identify significant sources of market liquidity stress
8.2.4 Scenario Analysis
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Sr. No. ALM Functional Requirements
1 produce budgetary and customer scenarios defined by type of contract.
2 scenario-dependent projections of future earnings, balance, market values, yields,
cash-flows, etc.
3 measure earnings effects, future liquidity risk, and product-inherent optionality
risk
4 allow user to simulate new business, by defining volume projections, instrument
characteristics, price rate models, and maturity schedules
5 perform income simulation: Future Earnings and capital requirements.
6
provide a robust cash flow engine as part of the system that supports at least, but
not limited to, the following:
Conventional amortization (EMI)
Annuity payments with fixed maturity
Annuity payments with variable annuity
Principal only
Balloon/Bullet/Staggered payments
Amortization for floating rate instruments
Customized (user-supplied) amortization schedules
Negative amortization
NPAs and Restructured accounts
Instruments such as Bonds, Swaps, Repos, Reverse Repos, CDS, futures, options
(cash-flow, swap, cap/floor) and forward rate agreements
Instruments without embedded optionality (E.g., CASA deposits)
Off-balance sheet assets and liabilities without defined maturities (E.g., LCs, LGs)
7
model instrument / account level prepayment assumptions by, but not limited to,
the following methods:
By specifying a constant flat percentage of the current balance
By specifying prepayment rates based on either age, term or rate characteristics
By specifying mathematical relationships between prepayment rates & bank
lending rates/spreads over base rate
By incorporating seasonality adjustment factors based on past experience for
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Sr. No. ALM Functional Requirements
prepayments
8
support the choice of at least the following term structure models (including no-
arbitrage models):
Merton
Vasicek
Ho & Lee
Extended Vasicek
8.2.5 Data Requirements
Sr. No. ALM Functional Requirements
1 Market Data
1.1 Market Data Sourcing
1.1.1 capture price/volatility/spread data relating to a broad range of products from
different data providers, to allow the Bank to record its current and likely future
treasury activities accurately, including, but not limited to, the following:
Fixed Income Investments (Central Government Securities, State Government
Securities, Other Approved/SLR Securities, Treasury Bills, Cash Management Bills,
Corporate Debt, Commercial Paper, Certificates of Deposit)
Stock Investments (Equity, Preference Shares and Mutual Funds)
Lending and Borrowing Operations (Repo Transactions, Reverse Repo
Transactions, Interbank Lending Operations, Central Bank Lending Operations, Call
Money, Notice Money, Refinancing operations - NABARD, SIDBI)
Over-the-counter and Exchange traded Derivatives (Exchange Traded Futures,
IR/Fx Swaps, Credit Derivatives, Cross currency swaps, Fx Options, Interest Rate
Options, Forward Rate Agreements)
1.1.2 allow addition of new market data sources. E.g., configure the system to obtain
equity price information from Bloomberg rather than Reuters
1.1.3 source time stamped market data (e.g., Open/ High/ Low/ Close) across multiple
markets, taking to account varying business hours
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Sr. No. ALM Functional Requirements
1.1.4 allow user to configure intraday timings for sourcing market data
1.1.5 allow user to configure change in market data source as either temporary or
permanent
1.1.6 allow user to configure alternative data source in case of failure of primary source
system (E.g., BSE prices when the NSE price feed suffers disruption)
1.1.7 obtain information from external sources on historic values of various risk factors
(E.g., equity index and individual equity prices, forex prices, commodity prices,
spreads over benchmark curves for Bank/PSU/FI/Corporate rated bonds, etc.)
relevant to market risk computations. Historic data for the last 5years should be
available.
1.1.8 configurable data sourcing timings for users in different time zones, e.g., London
branch should be able to download FTSE closing prices at the end of day, and head
office should be able to value London portfolio at the start of Indian business day
1.1.9 allow modification of input price/curve data as required by the pricing model, e.g.
transforming quarterly quotes into monthly prices
2 Static & Reference Data
2.1 Static Data Sourcing
2.1.1 source reference data from relevant sources including:
Instrument reference data for (past, current and future) traded products. (E.g.,
Bloomberg/Reuters/FIMMDA ticker, Index constituents, etc.)
Internal Desk/Book hierarchy data
Product hierarchy data (e.g. relationship of asset classes, instruments and sub-
products
Counterparty data including a standardized, organization-wide counterparty
hierarchy
Calendar / business day conventions
Static data values (e.g. country codes, currency codes etc.)
2.1.2 allow definition of new reference data types and modification of pre-defined data
types (E.g., addition of a new level in the product hierarchy)
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Sr. No. ALM Functional Requirements
2.1.3 allow sources of reference data to be changed, and the reference data should
have an attribute identifying data source
2.1.4 support all types of day count basis including 30/360, Actual/360, Actual/365,
Actual/Actual, 30E/360
2.1.5 support International Swaps and Derivatives Association (ISDA) -defined business
day conventions such as following, modified following, preceding, next month, this
month, average of the month etc.
2.1.6 support user defined reprising to input changes in asset prices that do not flow
from data feeds
2.2 Holiday Calendars
2.2.1 load calendar schedules from external sources including but not limited to SWIFT,
International Holiday schedule and Bloomberg holiday schedule etc.
2.2.2 allow users to set calendar schedules through interfaces/ patch updates
2.2.3 allow configuration of multiple holiday tables for each currency and country
2.2.4 allow users to input calendar schedules at least 7 years forward
2.2.5 edit and override global calendar and holiday tables
2.2.6 flag trades executed on a global holiday through exception messages and
exception reports
2.2.7 define settlement instructions based on emergency holidays
2.2.8 model cash flows and interest accruals based on holiday calendar and standard
day roll conventions
3 Position Data
3.1 retrieve position data from treasury system to perform valuations
3.2 allow user to create, save and load portfolios of bank’s position in various
instruments/ currencies
3.3 automatically recalculate the trade or portfolio value if (relevant) market rate
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Sr. No. ALM Functional Requirements
changes are detected
3.4 allow user, based on access rights, to create portfolios across all dimensions (E.g.,
Bank-wide, HFT/AFS/HTM, Trading Book, Commodity, Risk factor, individual
position, Trader, currency, delivery location, Trade type, Time bucket, etc.)
3.5 support different types of portfolio revaluation methodologies: marginal, full, no
recalculation, manual, timed (i.e. every 10 minutes, batch), etc., or any portfolio-
wise combination of the same.
3.6 provide various options to value the Bank’s investment portfolio: current market
rates, freeze current market rates (snapshot), etc.
3.7 facility to specify if portfolio should be loaded as of a specific date in the past
3.8 select Position / Price / Liquidation methodology for aggregated positions:
Average Cost, LIFO, FIFO, Max Profit, Least Profit, User defined
3.9 display information at trade and portfolio levels
3.10 display valuation results using drill down capabilities (e.g. Local Currency, Base
Currency, Reference Currency)
3.11 display portfolio results, where possible, by a user definable maturity grid
3.12 bucket portfolio open positions into the maturity grid using industry standard
methodologies: Previous Bucket Point, Following Bucket Point, Proportional ,
Nearest, Delta Equivalent, Proprietary, etc.
3.13 create, name, save and load portfolio ‘views’ as result of the previous choices
3.14 provide Hedge Effectiveness Testing and Portfolio Optimization functionalities.
I.e., the system should be able to compute the effectiveness of hedges as well as
to determine the optimal portfolio composition given various constraints (E.g.,
minimum/maximum investments in certain assets)
4 Data Upload
4.1 time stamp and record data source for each data upload
4.2 allow user to decide the frequency and mode of data upload, e.g., timed update or
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continuous update
4.3 upload position, rate and valuation information of the investment portfolios of
local as well as overseas branches to allow consolidated reporting
5 Data Overrides and Adjustments
5.1 allow users to apply adjustments to address erroneous values via single point
changes or mass updates
5.2 log data corrections and communicate the same to relevant upstream/
downstream systems
5.3 maintain an audit trail of data changes made by users
5.4 allow reversal of changes made based on access rights given to different levels of
users
6 Data Validation
6.1 validate user entered data at the time of data sourcing, preferably by field input
controls, e.g., format of input, date checks, etc.
6.2 support configurable data checks on consistency and integrity of all data inputs
(market data obtained from different data providers, position data from treasury
systems, etc.). The checks should be configurable on single data points as well as
on groups of data, e.g., curves
6.3 support validation of uploaded data by means of business rules with configurable
parameters
6.4 ensure that there are effective checks and controls to ensure that transactions are
not loaded multiple times in the host system, i.e., duplication checks
6.5 perform data validation to reconcile position data in the treasury system with
market risk system
7 Data Storage and Archival
7.1 store on a daily basis the following information:
Position and transaction data at a granular level present in the Bank’s portfolio
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Sr. No. ALM Functional Requirements
Market data (yield curves, volatility curves, Fx Spot and Forward prices , FX
volatilities)
Market prices (for quoted instruments) and book value for instruments that are
not traded often
Net Present Values(NPV), MTM and Greeks at transaction and aggregated levels
Value-at-Risk at transaction and aggregated levels
Scenario Results at transaction and aggregated levels
Profit & Loss results at transaction and aggregated levels
7.2 import historical market prices files from external vendors for volatilities and
correlations calculations for transactions on new markets
7.3 import historical position information either directly from existing systems or in
the form of data upload files to allow easy system migration, generation of
historical results and also to mitigate the impact of incorrect data uploads
7.4 store historical market rates information through automatic end-of-day
procedures and historical results for at least 10 years
7.5 store the complete set of data used as input to calculations performed by the
system
7.6 allow users to view complete data snapshot of any previous business day
7.7 support storage of all current and historical position, market and reference data
on a daily basis, and allow users to view the complete set of data for any given day
7.8 store system-generated data points (e.g. interpolated values), with configurable
flags determining whether or not data is stored
7.9 transform data from source format to a standard format for storage/ archival
7.10 provide data mining functionalities (e.g. identifying from a set of historical data
the worst one month/quarter/year)
7.11 support archiving of data that are beyond a specified time horizon
7.12 export data to secondary storage device without down-time
7.13 support data retrieval from the specified archives. The archival and retrieval
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Sr. No. ALM Functional Requirements
programs should facilitate easier analysis of old data.
7.14 in-built Data warehousing capabilities or standard interface with Data
warehousing solutions
8 Data Quality and Statistics
8.1 provide an analysis of data quality, i.e., completeness and accuracy of inbound /
outbound data feeds and reporting on key data quality metrics
8.2 provide a tool for automatic verification and validation of uploaded data with
appropriate measure of correction
8.2.6 Reporting Requirements
Sr. No. ALM Functional Requirements
1 Aggregation and Drill-down Capabilities
1.1 record information to identify various dimensions of ALM reporting from the
perspective of aggregation, including, but not limited to:
1.1.1 multiple jurisdictions: To roll solution out across multiple legal jurisdictions
1.1.2
multiple currencies: To handle all currencies the Bank has rate-sensitive exposure
to. The system should also be able to convert all currencies to the Bank’s reporting
currency (INR) using FEDAI spot rates
1.1.3 multiple departments: To allow rule-based access to different departments as
required
1.1.4 multiple products and product categories: To handle all risk sensitive assets and
liabilities that may be present in the Bank’s portfolio
1.2 allow rule-based aggregation to identify exposures across each dimension above
1.3
drill-down from the interest rate sensitivity, structural liquidity and any other
analysis to a granular level (E.g., Product level, portfolio level, geography level,
etc.)
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Sr. No. ALM Functional Requirements
2 Reporting and Analysis
2.1 reporting should be compliant with regulatory requirements
2.2 predict possible business volumes, maturity patterns, etc. utilizing historical data
and simulation
2.3 report at any level of detail (drill down and aggregate)
2.4 build customizable hierarchical roll up structure
2.5 provide graphical representation of reports as appropriate
2.6 report across product, account, and business unit
perform the following analysis:-
Interest Rate Risk in the Banking Book and Trading Book: Interest Rate Sensitivity
Analysis – Traditional Gap Analysis and Duration Gap Analysis
Structural Liquidity Analysis
Re-pricing balance sheet/gap analysis
Cash flow balance sheet
Breakup of cash flow and balance sheet into deterministic (contractual assets and
liabilities) and dynamic (non-contractual assets and liabilities)
Market value balance sheet (present values)
Value effect: economic value sensitivity
key rate duration
Scenario analysis (parallel shifts, non-parallel shifts)
Trend analysis
Static profitability analysis: yield report
Effective yields
Market Value Sensitivity (MVS)
Market Value of Equity (MVE)
NII and NIM analysis
Behavioral analysis for rate sensitivities with embedded optionality
2.7
generate standard reports for following:
RBI mandated Structural liquidity reports:
Domestic Currency – Indian Operations
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Foreign Currency – Indian Operations
Combined Indian Operations – Domestic and Foreign Currency
Overseas branch Operations – Country-Wise
Consolidated Bank Operations
RBI mandated Interest Rate Sensitivity reports to monitor Interest Rate Risk in the
Banking Book and Trading Book:
Traditional (Static) Gap Analysis
Duration (Dynamic) Gap Analysis
RBI mandated Short Term Dynamic Liquidity Statement
Currency-wise mismatch reports
Cash flow projections
Bucket-wise mismatch reports
Variance analysis
Mark to market reports
Net Interest Income reports
Economic Value of Equity Analysis
Product/ Account Level Profitability Analysis
Line of Business Level Profitability Analysis
FTP Division of spread analysis, by lending, funding and interest rate risk spreads
Total Organizational Level Profitability Analysis
Cost of Fund by Product/Account
Net Interest Margin Analysis
Key early warning/risk indicators
Status of contingent funding sources
Interest Rate Risk Analysis/Reporting
Value at Risk Analysis and Reporting
Earnings at Risk Analysis and Reporting
Market Value - deterministic and stochastic
Scenario Income reports
Gaps statement based on contractual maturity
2.8 provide querying facilities to build own queries
3 Report Customization
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3.1 provide a user-configurable ALM dashboard
3.2 provide user-definable time buckets
3.3 provide user-definable chart of accounts, classification, sub-classification, maturity
buckets, reference rates, yield curves, currencies etc.
3.4 Ratio Builder, which allows users to define any number of categories and ratios
3.5 support custom report designing
3.6 allow users to specify the exact layout of the required report including location of
fields, header, footer, page numbering, title etc.
3.7 allow users to define structures and fields of each report by selecting fields from
databases of their choice
3.8 provide a report writing wizard that provides users with step by step menus and
allows them to draw up reports in the required format
3.9 allow users to present outputs from reports in the form of graphs, charts and
other graphical representations
3.10 allow for sorting of data in reports
3.11 isolate and report errors and exceptions
3.12 allow user defined filters
3.13 customize reports with respect to time period considered, portfolios considered,
levels of granularity, etc.
4 Scheduling of Reports
4.1 generate pre-defined end-of-day, end-of week and end-of month reports
4.2 generate pre-defined reports with minimum user interference
4.3 define a schedule for reports and reports should be generated as per the
frequency defined by the Bank
4.4 allow defining the users to whom reports can be automatically sent
5 Archiving of Reports
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5.1 archive historical reports
5.2 archive historical rates extracted from market information systems
6 Ad hoc Reporting
6.1 allow users to customize standard reports for their own profile (E.g., different
portfolio, specific time period, comparing with historic results), without affecting
reports generated by other users
6.2 allow users to configure what-if analysis to analyze the impact of new positions,
amendments to existing positions, unwinding positions, etc.
7 General Requirements
7.1 generate all regulatory reports required in appropriate regulatory formats
7.2 provide pre-configured internal reports in standardized templates, for effective
market risk management.
7.3 allow user to configure and generate new ad hoc reports and save report
configuration in user profile
7.4 retain historic report information to compare report outputs over a configurable
time period (E.g., previous day or previous month end)
7.5 distribute reports according to user-configurable distribution parameters, e.g.,
email to a generic inbox, save to a server location, etc.
8.2.7 FTP Requirements
Sr. No. ALM Functional Requirements
1
provide distinct modules to approach FTP, enabling the user to define the interest
rate environment, interface with the bank systems for information on the product
portfolio, establish costing rules at a desired level of granularity, analyze the cost
of source and use of funds and generate appropriate end user reports
2 provide flexibility to choose from multiple FTP methodologies (Cost of funds/ Net
Funding/Pooled Funding/Matched Maturity)
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Sr. No. ALM Functional Requirements
3
generate the Base FTP curve for each use and source of fund on the underlying
account or transaction attributes at the time of origin at a granular account-level
using matched maturity methodologies such as bullet, cash flow and weighted
average life funding
4
generate the base FTP curve by combination of multiple yield curves for different
maturities, as a combination of:
Treasury rates
Funds pool
Bank cost of funds
Target borrowing rate
Swap curves
CD rates
LIBOR/MIBOR
5
view FTP rates across at multiple granularities:
product
business unit
branch
Bank/ entity
6 analyze profitability at various levels by generating the economic value and the
corresponding FTP rates
7
calculate liquidity cost for:
on-balance sheet assets consuming liquidity based on tenor at origination date
and on marginal cost.
contingent liquidity risk (cost of holding stand-by liquidity buffer to cover
unexpected liquidity needs and cost of roll-over risk)
other categories of possible liquidity risk exposure (E.g., country risk cost due to
extension of funding to clients in non-fungible currencies)
8
calculate, assign / allocate FTP costs, behavioral models or pricing assumptions
based on the following:
Basis risk
Liquidity risk
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 183 of 250
Sr. No. ALM Functional Requirements
Funding rates (Base Government ZCYC rate/ LIBOR/MIBOR)
Fixed rate structural funding cost
Option cost
On-balance sheet and off-balance sheet products
9 project and price undrawn off-balance sheet items, including contingent
commitments, by means of stress and scenario testing
10 quantify impact due to change in FTP rates, methodologies, behavioral models,
volumes, changes in key stress assumptions, etc.
8.3 Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for successful
implementation of the offered Solution, in the format specified in Annexure 11.4 Technical Bid
Format sub section 11.4.10.
Sr. No. Module/ Item Module Description Requirement Quantity
8.4 Training Requirements
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.11.
Sr. No. Requirements
1
How many Implementation trainings (MRMS and ALMS) have been undertaken by
the Bidder so far?
2 Please provide a brief description on the Training approach taken by the Bidder.
3 Please provide the following details for training :
3.1 Number of man-days / duration for completion of training
3.2 Optimum batch size
3.3 Total efforts for conducting the training
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 184 of 250
Sr. No. Requirements
3.4 Location
3.5 Frequency of training offered
3.6 Pre-requisites / Preparations required before training
4
Please answer the following about the trainers in-charge of conducting the training
on behalf of the Bidder for the Bank:
4.1
Median experience of all trainers with the Bidder who would be involved with the
Project
4.2
Median experience of all trainers involved with the Project, working / training on the
solution proposed by the Bidder
5
Please provide a sample training response and feedback from previous
implementations
Also, please give details of the following:
5.1 Name of the Bank where product was implemented and the training conducted
5.2 Date and place where training conducted
5.3 Training audience
5.4
Indicative rating [if any provided] Note: Please attach the feedback in a separate
document with proper cross-referencing
6
Please specify the various modes through which the training will be delivered? [e.g.
Classroom training, Online self-help training modules within application / e-
learning modules, Quiz, etc.]
8.5 Project Management Methodology
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.12.
Sr. No. Requirements
1 Details of methodology / approach
The methodology section should Adequately address the following stages of the
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 185 of 250
Sr. No. Requirements
project:
1.1 Frequency and approach for periodic reporting on the progress of the project and
actual status vis‐ à‐vis scheduled status
1.2 Detailed Study of Current State, with detailed work steps and deliverables
1.3 Gap analysis including identification and resolution of gaps
1.4 Customization, development and necessary work around
1.5 Building up of interfaces with various applications currently used by the Bank
1.6 Setting up of the data center and the disaster recovery site
1.7 User acceptance testing
1.8 Planning for roll‐out and identification of key issues that may arise along with
proposed solutions
2 Timelines
3 Project management activities
4 Roles and responsibilities of proposed personnel both from the bidder
5 Following details with respect to the methodology followed by the bidder in
Project Management for a Public Sector/Private Bank of comparable size/
complexity of operations as that of Canara Bank
5.1. Project Name
5.2. Project Location
5.3. Client Name
5.4. Client address
5.5. Client contact/reference person(s)
5.6. Project started (month/year)
5.7. Project elapsed time – months
5.8. Man‐months effort
5.9. Project Size (No of branches, modules covered and any other relevant details)
5.10. Name of senior project staff
5.11. Nature of the Project
5.12. Project Management Methodology used
5.13. Role of the Bidder, whether complete end‐to‐end involvement or for a particular
module
5.14. Project detail (Broad detail – information about all activities handled, modules
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 186 of 250
Sr. No. Requirements
forming part of the Market Risk and ALM Project of the Client Bank, associated
activities, time lines activity‐wise and module‐ wise may be detailed.)
8.6 Additional Information for Market Risk
8.6.1 List of Risk Factors
The table below represents risk factors required to calculate market risk measures relevant to
Bank portfolio. This list is a baseline for the design phase, but a key requirement will be the
ability to incorporate additional risk factors as required.
Risk Factor Dimensions
Interest Rate
Zero Coupon Interest Rate Per currency per tenor
Bond Swap Spreads Per currency per tenor
Cross Currency Basis Swap Spreads Per currency pair per tenor
Tenor Basis Spreads Per currency per tenor
Cross Currency Basis Spreads Per currency pair per tenor
Government Bond Prices Per currency per tenor
T-Bills Per currency per tenor
Futures Contracts Per tenor
OIS Rates Spread over Benchmark curve
Certificate of Deposit Rates Per tenor
Repo Curve Per currency per tenor
Par Swap Curve
Base Rate Curve Per currency per tenor
Funding Curves Per currency per tenor
Cash Futures Spreads Per currency per tenor
Equity
Equity Spot Prices
Equity Forward Prices Per tenor
Equity Index Prices
Equity Index Forward Prices Per tenor
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 187 of 250
Risk Factor Dimensions
FX
FX Spot Prices Per currency
Forward FX Rates Per currency per tenor
Commodities (Precious Metals)
Spot Prices
Forward Curves Per tenor
Inflation
Zero Rates
Market Rates
Implied Volatility
IR Option Expiry and Swap Maturity Matrix
FX Option Per underlying price per tenor
FX Option Smile/Skew Delta10, Delta25
Commodities (Precious Metals) Per underlying price per tenor
Credit Spread
CDS Spreads and Recovery Rates Per Issuer, currency, seniority, name,
rating and industry
CDS Indices Per underlying price per tenor
Bond Z Spreads Per underlying price per tenor
Historic Correlation
Inflation Per currency
X-Ccy Correlations Per currency pair per tenor
IR Domestic Per currency per tenor
IR Foreign Per currency per tenor
IR Domestic – FX Per currency per tenor
IR Foreign – FX Per currency per tenor
8.6.2 List of Risk Measures
The table below represents risk measures relevant to Bank portfolio. This list is a baseline for
the design phase, but a key requirement will be the ability to incorporate additional risk
measures as required.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 188 of 250
Risk Measures
Sensitivity Calculations
IR
IR PV01
Duration
Modified Duration
IR Option Greeks*
Basis Risk
Credit CS01
Bond Z-Spread PV01
FX
NOOP – Net Spot
NOOP – Net Forward
NOOP – Delta Equivalent
FX Option Greeks*
FX Smile – Risk Reversals
FX Smile – Butterfly
VaR
Standard VaR
Incremental VaR
Marginal VaR
Conditional VaR (Expected Shortfall)
Stressed VaR
Stressed P&L
NII (Net Interest Income) Sensitivity
* Delta, Vega and other higher order terms e.g. Gamma, X-Gamma, Vol-Gamma, Vanna
9. Integrated Capital Computation & Reporting Module
As the capital computation for credit risk, operational risk and market risk will be done by
separate system / application, the bank needs a module to extract and collate the individual
capital calculations and report the integrated capital of the Bank (solo) and group level.
9.1 Functional Requirements
The responses to the requirements mentioned within this section are to be furnished in the
format specified in Annexure 11.4 Technical Bid Format sub section 11.4.13.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 189 of 250
Sr. No. Requirements
1 Reporting
1.1 A reporting Tool with a presentation layer
1.2 An ETL tool for extraction of capital computed from the three respective systems
(CRMS, ORMS and MRMS)
2 Data Model
The solution should
2.1 provide a single data model to serve as a single repository for all the Market Risk,
Credit Risk, Operational Risk, ALM and FTP Solutions
2.2 provide a Physical Data Model
2.3 provide the ability to perform data transformation
2.4 provide the ability to execute the calculation of each of the concerned applications
directly from the Data Model
2.5 provide a single framework for the definition of calculation runs across all
applications (Market Risk, Credit Risk, Operational Risk, ALM, FTP)
2.6 Provide a single mechanism for batch execution across applications
2.7 provide the ability to trace data calculations across the applications
9.2 Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for successful
implementation of the offered Solution, in the format specified in Annexure 11.4 Technical Bid
Format sub section 11.4.14.
Sr. No. Module/ Item Module Description Requirement Quantity
9.3 Training Requirements
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.15.
Sr. No. Requirements
1 How many Implementation trainings (Integrated Capital Computation & Reporting
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 190 of 250
Sr. No. Requirements
Module) have been undertaken by the Bidder so far?
2 Please provide a brief description on the Training approach taken by the Bidder.
3 Please provide the following details for training :
3.1 Number of man-days / duration for completion of training
3.2 Optimum batch size
3.3 Total efforts for conducting the training
3.4 Location
3.5 Frequency of training offered
3.6 Pre-requisites / Preparations required before training
4 Please answer the following about the trainers in-charge of conducting the training
on behalf of the Bidder for the Bank:
4.1 Median experience of all trainers with the Bidder who would be involved with the
Project
4.2 Median experience of all trainers involved with the Project, working / training on the
solution proposed by the Bidder
5 Please provide a sample training response and feedback from previous
implementations
Also, please give details of the following:
5.1 Name of the Bank where product was implemented and the training conducted
5.2 Date and place where training conducted
5.3 Training audience
5.4 Indicative rating [if any provided] Note: Please attach the feedback in a separate
document with proper cross-referencing
6 Please specify the various modes through which the training will be delivered? [e.g.
Classroom training, Online self-help training modules within application / e-
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 191 of 250
Sr. No. Requirements
learning modules, Quiz, etc.]
9.4 Project Management Methodology
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.16.
Sr.
No.
Requirements
1 Details of methodology / approach
The methodology section should Adequately address the following stages of the
project:
1.1 Frequency and approach for periodic reporting on the progress of the project and
actual status vis‐ à‐vis scheduled status
1.2 Detailed Study of Current State, with detailed work steps and deliverables
1.3 Gap analysis including identification and resolution of gaps
1.4 Customization, development and necessary work around
1.5 Building up of interfaces with various applications currently used by the Bank
1.6 Setting up of the data center and the disaster recovery site
1.7 User acceptance testing
1.8 Planning for roll‐out and identification of key issues that may arise along with
proposed solutions
2 Timelines
3 Project management activities
4 Roles and responsibilities of proposed personnel both from the bidder
5 Following details with respect to the methodology followed by the bidder in
Project Management for a Public Sector/Private Bank of comparable size/
complexity of operations as that of Canara Bank
5.1 Project Name
5.2 Project Location
5.3 Client Name
5.4 Client address
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 192 of 250
Sr.
No.
Requirements
5.5 Client contact/reference person(s)
5.6 Project started (month/year)
5.7 Project elapsed time – months
5.8 Man‐months effort
5.9 Project Size (No of branches, modules covered and any other relevant details)
5.10 Name of senior project staff
5.11 Nature of the Project
5.12 Project Management Methodology used
5.13 Role of the Bidder, whether complete end‐to‐end involvement or for a particular
module
5.14 Project detail (Broad detail – information about all activities handled, modules
forming part of the Project on Integrated Capital Computation and Reporting
Module of the Client Bank, associated activities, time lines activity‐wise and
module‐ wise may be detailed.)
10. Technical Specifications across all systems/ risk solutions
Following are the technical specifications required across all systems and risk solutions provided
under the EWIRM Solution.
Please provide descriptive responses to the following requirements in the format specified in
Annexure 11.4 Technical Bid Format sub section 11.4.17.
Sr. No. Technical Requirements
1.0 Audit Requirements
1.1 store market rates, yield curve rates, assumptions made and maintain audit trail
1.2 generate a detailed audit trail on a daily basis for the following minimum
features: attempted unauthorized logins, time of login and logout, change of
passwords, change of parameters, data modifications
1.3 maintain the audit trail with details like user name, date and time details of the
changes made
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 193 of 250
Sr. No. Technical Requirements
1.4 support drill down of the audit trail to granular levels and track users across
each activity
1.5 time stamp transactions with user ID along with details of modification, previous
value, etc. Changes should be able to be rolled back to a previous state.
1.6 generate audit trail that includes details of databases accessed and modified by
the users
1.7 store and track all system events, including corrections and cancellations
1.8 allow deal amendments only with relevant audit trail details
1.9 generate error log in case of missing and/or erroneous data
1.10 archive audit log files
1.11 System should be able to
o create customized rules to validate and audit operational processes
o understand and refine mission-critical processes by logging exceptions
and violations
2.0 Edit Check
2.1 perform logical edit checks on all input fields
2.2 provide intelligible edit error messaging to assist correction and re-entry of data
2.3 reject entries that cause edit errors
2.4 provide ability to over-ride edited errors
3.0 User Interface
3.1 provide access to reporting and system functionalities through a web-based
application without the Bank requiring no additional software installation
3.2 provide consistent and user-friendly interfaces to access the information via a
GUI
3.3 provide users with a single point of access, to access all functionality available to
their user account through a single entry point
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 194 of 250
Sr. No. Technical Requirements
3.4 generate error messages based on pre-defined parameters
3.5 provide online and offline context-sensitive help
3.6 allow users to print reports directly from the system
3.7 interface with mail box of the users to generate notifications and auto-mailers
3.8 provide metrics on the success of processes, and flag where processing
exceptions occur e.g. via output / error logs. It should also provide in-process
and post-process performance statistics where possible e.g. time remaining to
complete, time taken to complete etc.
3.9 generate reports as per the Automated Data Flow (ADF) requirements of the
bank.
3.10 The tool should allow the analysis / explorations / reports to be pushed for
offline viewing to mobile devices
4.0 Intranet Enablement
4.1 provide user access through the intranet and remote access to authorized users
5.0 System Availability
5.1 system outage time due to events such as server down, application down etc.
should not exceed the minimum tolerable downtime defined by the bank for the
application.
5.2 operate with a 98.5% minimum availability for business users during hours of
business for each time zone. The system should be available if all functions are
running at 100% functionality and not impaired.
5.3 overnight reports generated by end-of-day processing should be ready at a time
agreed in the system SLAs on business days for each time zone
5.4 In the case of a system failure with no loss of data, restore to an operational
state within 120 minutes if within standard hours of service as defined in the
SLA.
5.5 In the case of a system failure and the loss of data integrity, restore to an
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 195 of 250
Sr. No. Technical Requirements
operational state with the most recently backed up data within an acceptable
timeframe as defined in the SLA.
5.6 In the case of a system failure mid-processing, resume all processes at an interim
point if possible and reasonable and if resulting in significant re-processing
computation time savings.
6.0 Scalability
6.1 scalable in such a way that an increase in the required number of risk factors /
scenarios / time steps can be satisfied by a proportional increase in the
hardware resources. The system must be able to handle predicted business
volume and product range growth by introducing a proportional increase in the
hardware resources.
6.2 System should offer horizontal scalability apart from vertical scalability
7.0 Flexibility
7.1 allow for changes to be made to existing methodologies (e.g. reconfigure
models, change process steps in models etc.) and allow for the addition of new
methodologies via the necessary support intervention.
7.2 Allow users to add, remove or amend data feeds, without requiring a change to
the system itself.
8.0 Performance
8.1 allow all available users (i.e. up to the number of user licenses) to run ad-hoc
reports simultaneously. The system should be able to handle simultaneous
requests from up to 4 times the number of normally logged on users (i.e. scaling
factor of 4x).
8.2 support prioritization functionality to ensure standard processes have sufficient
resources to run within required timelines without being affected by ad hoc user
requests
8.3 support the capture of, make available data related to and be able to report on
performance metrics sufficient to meet required performance reporting
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 196 of 250
Sr. No. Technical Requirements
regulations, if any. Alerts should be configurable around these generated
metrics. Examples of performance metrics include standard report calculation
times day on day and user load vs. ad-hoc report generation times
8.4 support intra-day feeds of data from external system(s) with resultant
downstream calculations and processes completed as quickly as possible and
practical
9.0 Disaster Recovery
9.1 support disaster recovery procedures to 'cutover' from a primary site to a
secondary site
9.2 resume processing using the disaster recovery secondary site within 24 hours
9.3 Performance requirements of the secondary disaster recovery site, when
activated, should exactly match those of the primary site
10.0 Overall System Architecture
10.1 Extract, transform and load data from all source systems
10.2 modular architecture – separate modules of the system should run
independently
10.3 platform independent
10.4 functionalities should be menu driven
10.5 provide facilities to filter, sort and assimilate data
11.0 Help Facility
11.1 provide simple and interactive dialogues to obtain the desired information e.g.
help facility
11.2 provide help facility which are context sensitive at field, screen etc.
11.3 provide context sensitive help to guide users to form the reports required by
them
11.4 help facility should explain probable causes of errors and possible solutions
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 197 of 250
Sr. No. Technical Requirements
12.0 Compatibility
12.1 perform queries against database irrespective of the technology/solution to be
implemented
12.2 store and retrieve data from existing systems and databases
12.3 provide an application programming interface to access outside programs
13.0 Interfacing with Information Feeds
13.1 interface with other solutions for receiving inputs and sending outputs, such as
automated information pricing feeds including but not limited to: Reuters,
Bloomberg, Negotiated Dealing System, National Stock Exchange, Moneyline
Telerate, RTGS, CDSL, NSDL, Legacy banking applications used by the bank,
EFT/SEFT, SWIFT, ECS, CRISMAC system, Credit risk rating system, Risk
management software, Data warehousing package, Inter-branch accounting
system, Liquidity management system, PDO/ CCIL, NDS-OM, FX Clear, NEFT,
SFMS, FIMMDA, AMFI, STP-GATE/ FTP, other existing system
13.2 accept inputs through a web-based interface
13.3 interface with accounting modules/systems in place at the bank
14.0 Manual Inputs
14.1 Incorporate customizable templates and Built-in data entry form for the cases
which are not captured through any other business application
15.0 File Import and Export Functionality
15.1 have a flat file import and export functionality to import and export transaction
data and static data in the following formats but not limited to: Microsoft Excel
Format (.XLS), Web Page (.HTML), Comma separated values (.CSV), Text file
(.TXT), Microsoft Word (.DOC), Adobe Reader (.PDF), ASCII (Flat File), Extended
Markup Language (XML),
16.0 Reconciliation
16.1 reconcile treasury transactions with electronically received holding statements
from custodians on a daily basis
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 198 of 250
Sr. No. Technical Requirements
16.2 reconcile GL balances with the aggregate account data to identify internal
inconsistency of the uploaded data
17.0 Batch Processing
17.1 receive and send transactions information in batch mode
18.0 Security
18.1 Security Management
18.1.1 allow users to be controlled by a specific administrator
18.1.2 permit access only through password verification, with a mechanism to generate
unique user ids
18.1.3 allow upgrades and patches to be uploaded only through the system upgrade
path and not to the run-time system
18.1.4 support addition of features only through a properly revised upgrade and data
migration method
18.1.5 provide or restrict access privileges based upon hierarchy and multiple criteria
18.1.6 provide role based access for front, middle and back office that can be defined
by the user
18.1.7 allow for setting of each user profile
18.1.8 synchronize the user id and password with network user id and password
18.1.9 databases should have database locking features in the situation that there are
multiple access and updates on the same record
18.1.10 provide unique identity for each user
18.1.11 support bank defined password expiry period
18.1.12 support password encryption
18.1.13 automatically lock user account after three successive erroneous tries
18.1.14 support granting/preventing access to data via a user administration GUI
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 199 of 250
Sr. No. Technical Requirements
18.1.15 isolate and report errors and exceptions
18.1.16 supports creation, deletion and modification of users, upgrades of users and
data access rights based on aspects of the user profiles (e.g., organizational unit,
grade, location, role)
18.1.17 support generation of lists of users, groups, logins and related system
permissions
18.1.18 support authorization configuration such as level of access to data e.g.
read/view data, print data, write/modify data, delete data etc.
18.1.19 enforce access control over who can change standard report configuration, and
maintain an audit trail of changes
18.1.20 check if a user is authorized to view the reports or data he/she has requested
and return appropriate error messages if access is denied
18.1.21 roll out formal changes to standardized reports for all users automatically
18.1.22 Blacklisting and immediate locking of accounts in case of identified security
breaches
18.2 Passwords
18.2.1 force change of password after a defined period of time (in days)
18.2.2 ensure that the password is at least 8 characters long and should be a
combination of alpha-numeric characters
18.2.3 allow access to users only through screens
18.2.4 maintain password history up to last 12 passwords
18.3 Auto Logout
18.3.1 logout users on user defined idle time
19.0 System Backup
19.1 provide day-end back-up process functionalities
19.2 back-up should be possible in external media editable/ non-editable (CD, tapes,
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 200 of 250
Sr. No. Technical Requirements
DVD) for off-site storage
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 201 of 250
11. Annexure
11.1 Undertaking from Bidder
Note: This Undertaking from the Bidder should be on the letterhead of the Bidder and should be
signed by an authorized person.
Date:
To,
General Manager,
Risk Management Wing,
Canara Bank Head Office,
112, J C Road
Bangalore - 560002
Dear Sir/ Madam,
We have sized the proposed Hardware, Database and Application licenses based on the terms
defined in the RFP. However, if the same fails to achieve the required performance as defined,
we agree to supply additional hardware, database licenses, software licenses and support to
meet the performance requirements as defined in the RFP at no incremental cost to the Bank.
Yours faithfully,
(Name of Authorized Signatory)
(Designation)
Duly authorized to sign Bid for and on behalf of
_________________________________
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 202 of 250
11.2 Eligibility Criteria Format
The Bidder must satisfy all the criteria mentioned in Section 4.3 Eligibility Criteria and submit the
same in the following format
Sr. No. Eligibility Criteria Compliance
(Yes/ No)
Proofs to be enclosed
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 203 of 250
11.3 Cover Letter for Technical Bid
Note: This cover letter for Technical Bid from the Bidder should be on the letterhead of the
Bidder and should be signed by an authorized person.
Date:
To,
General Manager,
Risk Management Wing,
Canara Bank Head Office,
112, J. C Road,
Bangalore - 560002
Sub: Response Solution to Implement Enterprise-wide Integrated Risk Management
Architecture under Basel II and Basel III.
Ref: Your Ref: ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Dear Sir/ Madam,
Having examined the Bidding Documents, the receipt of which is hereby duly acknowledged,
we, the undersigned, offer to supply and deliver the Solution to Implement Enterprise-wide
Integrated Risk Management Architecture under Basel II and Basel III, in conformity with the
said Bidding documents.
We undertake, if our Bid is accepted, to deliver, install and commission the Solution in
accordance with the Requirements specified within the RFP for Solution to Implement
Enterprise-wide Integrated Risk Management Architecture under Basel II and Basel III.
If our Bid is accepted, we will obtain performance guarantee of a bank for a sum equivalent to
10 percent of the Contract Price for the due performance of the Contract, in the form
prescribed by the Bank.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 204 of 250
We agree to abide by the Bid and the rates quoted therein for the orders awarded by the Bank
up to the period prescribed in the Bid, which shall remain binding upon us.
Until a formal contract is prepared and executed, this Bid, together with your written
acceptance thereof and your notification of award, shall constitute a binding Contract between
us.
We undertake that, in competing for (and, if the award is made to us, in executing) the above
contract, we will strictly observe the laws against fraud and corruption in force in India namely
“Prevention of Corruption Act 1988”.
We understand that you are not bound to accept the lowest or any Bid you may receive.
Dated this ....... day of ............................ 2013
_________________________________ ________________________________
(Signature) (Name) (In the capacity of)
Duly authorized to sign Bid for and on behalf of
_________________________________
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 205 of 250
11.4 Technical Bid Format
11.4.1 Credit Risk Management – Functional Requirements
The functional requirements specified in Section 6.1.1 Functional Requirements for Credit Risk
under IRB and Section 6.1.2 Functional Requirements for LOS has to be submitted in the
following format. The instructions for filling column no. 3 - S/A/C/U is furnished in section 4.4.2
Technical Bid Evaluation Criteria.
Sr. No. Credit Risk Functional Requirements S/A/C/U Remarks if Any
11.4.2 Credit Risk Management – Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for
successful implementation of the offered Solution, in the following format.
Sr.
No.
Module/ Item Module Description Requirement Quantity
Note:
1 Cost of ETL tools as part of proposed solution should be borne by bidder 2 Please mention Make / Model (if any), type and number of processors, Memory, bus speed,
hard disk & Operating System number of users, license type, version etc. 3 Detailed Bill of Materials (Line item wise mentioning technical specifications) to be
submitted for all the above modules 4 Detailed Technical sheets of the above modules to be submitted 5 Bidder to also provide detailed specifications for replication methodology for DR site
11.4.3 Credit Risk Management – Training Requirements
Please provide descriptive responses to the requirements specified in section 6.3 Training
Requirements for Credit Risk Management.
Sr. No. Requirements Response
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 206 of 250
11.4.4 Credit Risk Management – Project Management Methodology
Please provide descriptive responses to the requirements mentioned in section 6.4 project
management methodology for Credit Risk management.
Sr. No. Requirements Response
11.4.5 Operational Risk Management- Functional Requirement
The functional requirements specified in Section 7.1 Functional Requirements for Operational
Risk has to be submitted in the following format. The instructions for filling column no. 3 -
S/A/C/U is furnished in section 4.4.2 Technical Bid Evaluation Criteria.
Sr. No. Operational Risk Functional Requirements
S/A/C/U Remarks If Any
11.4.6 Operational Risk Management - Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for
successful implementation of the offered Solution, in the following format.
Sr. No. Module/ Item Module Description Requirement Quantity
Note:
1. Cost of ETL tools as part of proposed solution should be borne by bidder 2. Please mention Make / Model (if any), type and number of processors, Memory, bus speed,
hard disk & Operating System number of users, license type, version etc. 3. Detailed Bill of Materials (Line item wise mentioning technical specifications) to be
submitted for all the above modules 4. Detailed Technical sheets of the above modules to be submitted 5. Bidder to also provide detailed specifications for replication methodology for DR site
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 207 of 250
11.4.7 Operational Risk Management – Training Requirements
Please provide descriptive responses to the requirements specified in section 7.3 Training
Requirements for Operational Risk Management.
Sr. No. Requirements Response
11.4.8 Operational Risk Management – Project Management Methodology
Please provide descriptive responses to the requirements mentioned in section 7.4 project
management methodology for Operational Risk Management.
Sr. No. Requirements Response
11.4.9 Market Risk Management - Functional Requirement
The functional requirements specified in Section 8.1 and Functional Requirements for Market
Risk under IMA and Section 8.2 Functional Requirements for ALM System has to be submitted in
the following format. The instructions for filling column no. 3 - S/A/C/U is furnished in section
4.4.2 Technical Bid Evaluation Criteria.
Sr. No. Market Risk Functional Requirements S/A/C/U Remarks If Any
11.4.10 Market Risk Management - Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for
successful implementation of the offered Solution, in the following format.
Sr. No. Module/ Item Module Description Requirement Quantity
Note: 1 Cost of ETL tools as part of proposed solution should be borne by bidder
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 208 of 250
2 Please mention Make / Model (if any), type and number of processors, Memory, bus speed,
hard disk & Operating System number of users, license type, version etc. 3 Detailed Bill of Materials (Line item wise mentioning technical specifications) to be
submitted for all the above modules 4 Detailed Technical sheets of the above modules to be submitted 5 Bidder to also provide detailed specifications for replication methodology for DR site
11.4.11 Market Risk Management – Training Requirements
Please provide descriptive responses to the requirements specified in section 8.4 Training
Requirements for Market Risk Management.
Sr. No. Requirements Response
11.4.12 Market Risk Management – Project Management Methodology
Please provide descriptive responses to the requirements mentioned in section 8.5 project
management methodology for Market Risk management.
Sr. No. Requirements Response
11.4.13 Integrated Capital Computation & Reporting Module - Functional Requirements
The functional requirements specified in Section 9.1 Integrated Capital Computation &
Reporting Module has to be submitted in the following format. The instructions for filling
column no. 3 - S/A/C/U is furnished in section 4.4.2 Technical Bid Evaluation Criteria.
Sr. No.
Integrated Capital Computation and Reporting Module Functional Requirements
S/A/C/U Remarks If Any
11.4.14 Integrated Capital Computation & Reporting Module - Hardware Requirements
The Bidder must specify complete details of Hardware and other systems required for
successful implementation of the offered Solution, in the following format.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 209 of 250
Sr. No. Module/ Item Module Description Requirement Quantity
Note:
1. Cost of ETL tools as part of proposed solution should be borne by bidder 2. Please mention Make / Model (if any), type and number of processors, Memory, bus speed,
hard disk & Operating System number of users, license type, version etc. 3. Detailed Bill of Materials (Line item wise mentioning technical specifications) to be
submitted for all the above modules 4. Detailed Technical sheets of the above modules to be submitted 5. Bidder to also provide detailed specifications for replication methodology for DR site
11.4.15 Integrated Capital Computation & Reporting Module – Training Requirements
Please provide descriptive responses to the requirements specified in section 9.3 Training
Requirements for Integrated Capital Computation & Reporting Module.
Sr. No. Requirements Response
11.4.16 Integrated Capital Computation & Reporting Module – Project Management
Methodology
Please provide descriptive responses to the requirements mentioned in section 9.4 project
management methodology for Integrated Capital Computation & Reporting Module.
Sr. No. Requirements Response
11.4.17 Technical Specifications across all systems/ risk solutions
The requirements specified in Section 10 Technical Specifications have to be submitted in the
following format. The instructions for filling column no. 3 - S/A/C/U is furnished in section 4.4.2
Technical Bid Evaluation Criteria.
Sr. No. Technical Specifications S/A/C/U Remarks if Any
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 210 of 250
11.4.18 Hardware & Infrastructure Configurations for the Proposed Solution (Credit Risk,
Operational Risk, Market Risk, LOS, ALM and Integrated Capital Computation and
Reporting Module)
Configuration for the hardware and other infrastructure components required for the proposed
solution should be provided in the table below. It is important for the bidder to provide the
details with a view for seven years. It should also provide the details for the deployment of each
component in a phased manner aligned with the expected volume growth.
Sr. No. Components Proposed Configuration Justification
11.4.19 Additional Details - for CRMS, MRMS, ORMS, ALM, LOS & Integrated Capital &
Reporting Module
The Bidder should provide responses to following questions as part of the technical bid:
1. What is the hardware configuration required for optimal running of the software? Please
provide the configuration for 5‐year scalability.
2. What is the current version and release date of the installed product?
3. Details of major enhancements planned.
4. What is the road map of your product for the next 3 to 5 years?
5. What is the next scheduled major release?
6. Describe the integration details and mechanism between the solution components if solution
is modular type
7. Provide a copy of any benchmarking studies performed on your product(s). Please provide
layouts that depict the environment producing these results.
8. Provide details of the product's scalability in order to
Increase Workload
Better Performance
Add more Users
Improve Network connectivity
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 211 of 250
9. Describe the integration capabilities of your system to integrate with external Systems. The
system should interface with other solutions for receiving inputs and sending outputs, such as
automated information pricing feeds including but not limited to:
• Reuters
• Negotiated Dealing System
• Flexcube
• Legacy banking applications used by the Bank
• CRISIL System
• Other Risk Management Software
• Data warehousing package
• Liquidity Management System
• Any other existing system
10. The integration should be through exposed APIs and not through change in code. Are there
standard API's available for integration with external systems?
11. Data transfer from external system from/to your solution should be automated. Please
describe in detail the capability of your system
12. Please describe the problem reporting and resolution mechanism that would be used if Bank
identifies a problem or change request with the system
13. What is maximum response time in case of problem/ help required?
14. Is the Hotline support inclusive in the annual maintenance charge?
15. If charged on a per‐call basis, please provide cost."
16. What amount of training is included with the acquisition of the proposed systems, in terms of
number of people type of course/agenda and number of man‐days
17. Please specify the details of the training course
• Cost if any
• Location
• Duration
• Frequency of offering
• Prerequisites
• Training description
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 212 of 250
Signature of Bidder: __________________
Name: _____________________________
Business Address: ____________________
Place:
Date:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 213 of 250
11.5 Cover Letter for Commercial Bid
Note: This Cover Letter for Commercial Bid from the Bidder should be on the letterhead of the
Bidder and should be signed by an authorized person.
Date:
To,
General Manager
Risk Management Wing,
Canara Bank Head Office, 112, J. C Road
Bangalore - 560002
Sub: Procurement of Enterprise Wide Integrated Risk Management Solution under Basel II
/Basel III
Ref: Your Ref: ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐ ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Having examined the Bidding Documents, the receipt of which is hereby duly acknowledged, we,
the undersigned, offer to supply & deliver the Solution to Implement Enterprise Wide Integrated
Risk Management Solution under Basel II and Basel III, inconformity with the said Bidding
documents for the sum of ...................………….. (Total amount in words and figures) or such other sums as may be ascertained in accordance with
the Schedule of Prices (Part I and Part II) attached herewith and made part of this Proposal.
We undertake, if our Proposal is accepted, to deliver, install and commission the system, in
accordance with Requirements specified within the RFP for Solution to Implement Enterprise-
wide Integrated Risk Management Architecture under Basel II and Basel III .
We agree to abide by the Proposal and the rates quoted therein for the orders awarded by the
Bank.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 214 of 250
Until a formal contract is prepared and executed, this bid, together with your written acceptance
thereof and your notification of award, shall constitute a binding Contract between us.
We undertake that, in competing for (and, if the award is made to us, in executing) the above
contract, we will strictly observe the laws against fraud and corruption in force in India namely
“Prevention of Corruption Act 1988”.
We understand that you are not bound to accept the lowest or any Proposal you may receive.
Dated this ....... day of ............................ 2013
_________________________________ ________________________________ (Signature) (Name) (In the capacity of)
Duly authorized to sign Proposal for and on behalf of _________________________________
Enclosed:
1. Part I – Commercial Bid – Enterprise Wide Integrated Risk Management Solution: Credit Risk
Solution, Operational Risk Solution, Market Risk Solution and Integrated Capital Computation
and Reporting Module
2. Part II – Schedule for Annual Maintenance Cost (AMC) and Annual Technical Support (ATS)
and Warranty Period
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 215 of 250
11.6 Commercial Bid (Bill of Material) Format
11.6.1 Part I – Commercial Bid Format – Enterprise Wide Integrated Risk Management Solution:
Credit Risk Solution, Operational Risk Solution, Market Risk Solution and Integrated
Capital Computation and Reporting Module(Amount in INR Lakhs)
Sr.
No
.
Item Description No.
of
Units
(A)
Unit
Pric
e (B)
Sub-
Total
Price
(A*B)
Total Price
including
Taxes (Sales
Tax/VAT/Servi
ce Tax)
Total
Price
includin
g Taxes
&
Octroi)
Tota
l
Pric
e
A Software (for both DC& DR
Site)
1 Credit Risk Management
System
2 Loan Origination System
3 Operational Risk
Management System
4 Market Risk Management
System
5 Asset Liability Management
System
6 Integrated Capital
Computation and Reporting
Module
7 Middleware (if any)
8 Third Party Utilities (if any)
9 Software/tools for SLA
monitoring
Sub Total A
B RDBMS & environmental
Software (for both DC & DR)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 216 of 250
Sr.
No
.
Item Description No.
of
Units
(A)
Unit
Pric
e (B)
Sub-
Total
Price
(A*B)
Total Price
including
Taxes (Sales
Tax/VAT/Servi
ce Tax)
Total
Price
includin
g Taxes
&
Octroi)
Tota
l
Pric
e
1 Database Software License
Sub Total B
C Hardware (including for both
DC & DR Site)
1 Servers
2 Operating System
3 Storage (SAN)
4 Rack with KVM switch, power
supply, Network & security
requirements, switches,
routers, etc.
5 Hardware required for SLA
Monitoring
Sub Total C
D Implementation, System
Integration, Training
Integration of new systems
with existing systems
Sub Total (A+B+C+D)
E AMC & ATS cost as per Part II
F Facilities Management (both
at DC & DR)
Total Project Cost
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 217 of 250
Sr.
No
.
Item Description No.
of
Units
(A)
Unit
Pric
e (B)
Sub-
Total
Price
(A*B)
Total Price
including
Taxes (Sales
Tax/VAT/Servi
ce Tax)
Total
Price
includin
g Taxes
&
Octroi)
Tota
l
Pric
e
(A+B+C+D+E+F)
Total Project Cost (in words)
Rs………………………………..
Important Notes:
The detailed specifications of all software and the required hardware modules, components are
to be attached separately in the Technical Bid (Annexure 11.3 Technical Bid Format), supported
by Technical Literature/ Product Catalogues/ Brochures, etc. This is Mandatory.
1. All estimation to be done for both DC & DR
2. Bidder to clearly provide in the solution the training requirements – # of batches, participants
in each batch, how much time, type of training ‐ (functional or technical) and Incorporate
them in the pricing
3. AMC & ATS charges to be given in the format prescribed below in Part II.
4. Price quoted should be inclusive of all costs, out of pocket expenses, duties, levies, taxes and
all other applicable charges including sales tax/VAT, service tax, road tax, Octroi etc. as
applicable in respective State and should be inclusive of any changes in currency or tax
structure.
5. TDS will be deducted separately.
6. In case of discrepancy between figures and words, the amount in words shall prevail.
7. No increase in costs, duties, levies, taxes, charges, etc., irrespective of reasons (including
exchange rate fluctuations, etc.) whatsoever, shall be admissible during the currency of the
Contract.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 218 of 250
8. All user licenses for operating system, database, application etc. should be as per Technical
and Functional Requirements
Signature of Bidder‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Name ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Business address ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Place:
Date:
Part II – Schedule for Annual Maintenance Cost (AMC) and Annual Technical Support (ATS) and
Warranty Period
Sr.
No.
Description Quantity Cost Taxes (at
present)
Total
1 Solution for Risk
Estimation for
1.1 Credit Risk
Management System
1.2 Loan Origination
System
1.3 Operational Risk
Management System
1.4 Market Risk
Management System
1.5 Asset Liability
Management System
1.6 Integrated Capital
Computation and
Reporting Module
2 Server
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 219 of 250
Sr.
No.
Description Quantity Cost Taxes (at
present)
Total
2.1 Database Server – DC
site
2.2 Application Server –
DC site
2.3 Web Server - DC site
2.4 Database Server – DR
site
2.5 Application Server –
DR site
2.6 Web Server – DR site
2.7 Database Server –
UAT /Training
2.8 Application Server –
UAT /Training
2.9 Web Server - UAT
/Training
2.10 Any other (Please
specify)
3 Operating System
3.1 OS for Database
Server – DC site
3.2 OS for Application
Server – DC site
3.3 OS for Web Server –
DC site
3.4 OS for Database
Server – DR site
3.5 OS for Application
Server – DR site
3.6 OS for Web Server –
DR site
3.7 OS for Database
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 220 of 250
Sr.
No.
Description Quantity Cost Taxes (at
present)
Total
Server -
UAT/Training
3.8 OS for Application
Server –
UAT/Training
3.9 OS for Web Server –
UAT/Training
3.10 Any other (Please
specify)
4 RDBMS
4.1 RDBMS for Database
Server – DC site
4.2 RDBMS for Database
Server – DR site
4.3 RDBMS for Database
Server -
UAT/Training
4.4 Others (if any, please
specify)
5 Storage System
5.1 Disk Storage System
(SAN)
5.2 Tape Backup
5.3 Any other (Please
specify)
6 42u Server Rack with
Sliding TFT
Monitor and 8 Port
KVM Switch
(Analog/Digital) along
with necessary
Accessories
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 221 of 250
Sr.
No.
Description Quantity Cost Taxes (at
present)
Total
7 Layer 3 Switch
8 Layer 2 Manage
switch
9 Lease Line Modem
10 Lease line with backup
from another
service provider
11 Any other (Please
specify)
Total AMC/ATS Cost
Signature of Bidder‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Name ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Business address ‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐‐
Place:
Date:
*The AMC Price should be valid for 5 years.
11.6.2 Part I – Masked Commercial Bid Format – Credit Risk Solution, Operational Risk
Solution, Market Risk Solution and Integrated Capital Computation and Reporting
Module
Note: The masked commercial bid has to be submitted along with the Technical Bid
Sr.
No.
Item Description No.
of
Units
(A)
Unit
Price
(B)
Sub-
Total
Price
(A*B)
Total Price
including Taxes
(Sales
Tax/VAT/Service
Tax)
Total
Price
including
Taxes &
Octroi)
Total
Price
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 222 of 250
A Software (for both DC&
DR Site)
1 Credit Risk Management
System
X X X X X
2 Loan Origination System X X X X X
3 Operational Risk
Management System
X X X X X
4 Market Risk
Management System
X X X X X
5 Asset Liability
Management System
X X X X X
6 Integrated Capital
Computation and
Reporting Module
X X X X X
5 Middleware (if any) X X X X X
6 Third Party Utilities (if
any)
X X X X X
7 Software/tools for SLA
monitoring
X X X X X
Sub Total A
B RDBMS & environmental
Software (for both DC &
DR)
1 Database Software
License
Sub Total B X X X X X
C Hardware (including for
both DC & DR Site)
1 Servers X X X X X
2 Operating System X X X X X
3 Storage (SAN) X X X X X
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 223 of 250
4 Rack with KVM switch,
power supply, Network &
security requirements,
switches, routers, etc.
X X X X X
5 Hardware required for
SLA Monitoring
X X X X X
Sub Total C X X X X X
D Implementation, System
Integration, Training
X X X X X
Integration of new
systems with existing
systems
X X X X X
Sub Total (A+B+C+D) X X X X X
E AMC & ATS cost as per
Part II
X X X X X
F Facilities Management
(both at DC & DR)
X X X X X
Total Project Cost
(A+B+C+D+E+F)
X X X X X
Total Project Cost (in
words)
Rs………………………………..
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 224 of 250
11.7 Bid Offer Covering Letter
Note: This Bid Offer Covering letter should be on the letterhead of the Bidder and should be
signed by an authorized person.
Date:
To,
General Manager
Risk Management Wing,
Canara Bank Head Office, 112, J. C Road
Bangalore - 560002
Dear Sir/ Madam,
Subject: Response to RFP for Solution to Implement of Enterprise Wide Integrated Risk
Management Architecture under Basel II and Basel III
1. With reference to the RFP, having examined and understood the instructions, terms and
conditions forming part of the RFP, we hereby enclose our offer for the implementation
of Enterprise Wide Integrated Risk Management Solution: Credit Risk Management
Solution, Operational Risk Management Solution, Market Risk Management Solution,
Loan Origination System, Asset Liability Management System and Integrated Capital
Computation and Reporting Module for Advanced Approach under Basel II and Basel III.
2. We acknowledge having received the following addenda to the bid document:
Addendum No. Dated
3. We agree and undertake that if our proposal is accepted, we shall provide the services
comprised in the contract within the timeframe specified, starting from the date of
receipt of notification of award from Canara Bank.
4. We understand that the Bank is not bound to accept the offer and that the Bank has the
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 225 of 250
right to reject the offer without assigning any reasons whatsoever.
5. If the software, hardware, licenses sizing provided falls short of the projected growth rate
for the duration of the project as mentioned in the RFP, we will provide the additional
required software, hardware, licenses, etc. free of cost to the Bank.
6. We confirm that the offer is in conformity with the terms and conditions as mentioned in
RFP and it shall remain valid for 6 months from the last date of the acceptance of this bid.
7. The details of the Bid Cost / EMD are as follows:
Particulars DD No. / Pay Order
No
Issuing Bank Amount
Bid Cost
EMD
Yours faithfully,
(Name of Authorized Signatory)
(Designation)
Duly authorized to sign Bid for and on behalf of
_________________________________
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 226 of 250
11.8 Reference Site Details
The reference sites submitted must be necessarily of those banks where the proposed Bidder/
OEM’s product has been awarded the contract in the last five years prior to the last date for
submission of bids at Canara bank. For those references where the offered solution is accepted
but implementation is not started, the acceptance should be valid as on the last date for
submission of bids at Canara Bank.
Please provide reference details in the format defined below:
Particulars Response
Name of the Bank/ Financial Institution
Country of Operation
Address of the Organization
Annual Turnover of the Organization for the Financial
Year 2011‐12
Date of commencement of Project
Date of completion of Project
Scope of Work for Solution
OEM partner for the project
Number of users and the geographical spread of the
implementation
Average Team size on site for project implementation (SI
& OEM Team)
Contact Details from the Bank/Financial Institution for
reference
o Name of the Contact Person
o Designation
o Phone Number/e-mail
Note:
i. The bidder has to submit a consent letter for conducting a reference site visit by the Canara
Bank project evaluation team. The letter has to be on the letter head of the Bank/Financial
Institution.
ii. The cost for the reference site visit shall be borne by the Bidder
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 227 of 250
11.9 Particulars of Bidder
11.9.1 Profile of Bidder
Requirement Response
Name of Bidder
Registered Office Location with Address
Controlling Office Location with Address
Date of incorporation & date of commencement of
business
Major changes in Management in last 3 years
(details to be provided)
Names of Banker/s
Names and Designations of the persons authorized
to make Commitments to the Bank (attach a copy of
the board resolution authorizing the person to
make commitments)
Telephone and Fax Numbers of Contact Persons
E-mail addresses of Contact Persons
11.9.2 Financial Position of Bidder for last 3 financial years (in `̀̀̀Crores)
Particulars 2009-10 2010-11 2011-12
Paid up capital
Tangible Net Worth (excluding revaluation reserve)
Total Outside Liabilities/Tangible
Net Worth
Net Sales of the Company
Out of the above Net Sales, Net Sales from Services
Gross Profit
Net Profit (Profit After Tax)
Growth in Operations (%)
Growth in Profitability (%)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 228 of 250
11.9.3 Profile of OEM
Requirement Response
Name of OEM
Registered Office Location with Address
Controlling Office Location with Address
Date of incorporation & date of commencement of
business
Major changes in Management in last 3 years
(details to be provided)
Names of Banker/s
Names and Designations of the persons authorized
to make Commitments to the Bank (attach a copy of
the board resolution authorizing the person to
make commitments)
Telephone and Fax Numbers of Contact Persons
E-mail addresses of Contact Persons
Note - to be furnished for each OEM forming part of the Bid
11.9.4 Financial Position of OEM for last 3 financial years (in `̀̀̀Crores)
Particulars 2009-10 2010-11 2011-12
Paid up capital
Tangible Net Worth (excluding revaluation reserve)
Total Outside Liabilities/Tangible
Net Worth
Net Sales of the Company
Out of the above Net Sales, Net Sales from Services
Gross Profit
Net Profit (Profit After Tax)
Growth in Operations (%)
Growth in Profitability (%)
Note - to be furnished for each OEM forming part of the Bid
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 229 of 250
11.9.5 Project Details
Requirement Response
Estimated work plan and time schedules for
providing services for this project
Details of inputs, infrastructure
requirements required by the bidder to
execute this project.
Detail of the bidder’s proposed
methodology / approach for providing
services to the Bank with specific reference
to the scope of work.
Details of deliverables, the bidder proposes
with specific reference to the scope of
work.
Track record of supporting the proposed
software solutions after implementation
and warranty completion including
adequacy of the training programs and
knowledge transfer to the client(s).
11.9.6 Effort Estimate and Elapsed Time
Activities
Elapsed
Time
Effort
in
Man
Days
Number of
Team
Members
who will be
deployed
Remarks
Implementation Strategy & Plan
Installation and Commissioning of
Software
UAT and UAT Sign-off
Migration to Production Environment
Training
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 230 of 250
Activities
Elapsed
Time
Effort
in
Man
Days
Number of
Team
Members
who will be
deployed
Remarks
Implementation and Project
Documentation
Note: Enclose
1. copies of Audited Balance Sheets and P&L statements along with enclosures for last 3
financial years
2. Provisional financial statements as on 31.03.2013 along with summary as per above
format 3. copies of Articles of association and Memorandum of Association
4. copies of certificate of incorporation/certificate of commencement of business
5. copies of certificates of accreditation from ISO, SEI, CMM etc. as applicable
Place: Date: Signature:
Name & Designation: Business Address:
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 231 of 250
11.10 Past Experience Details
11.10.1 List of major customers where the proposed CRMS, ORMS, MRMS, LOS, ALMS and
Integrated Capital Computation Module solution have been implemented/under
implementation in India and their reference details
Sr.
No.
Name and
complete
Postal
Address of
the
Customer
Brief Scope
of work
(specify the
size of the
bank, the
approaches
supported
etc.)
OEM
Partner
for the
project
Attach
reference
Letter
Contact
Details
(Name,
Designation,
Phone,
Email)
Project Status
(Completed/
Under
Implementation,
Start Date, End
Date)
(Enclose necessary documentary proof such as reference letter)
11.10.2 List of major customers where the proposed CRMS, ORMS, MRMS, LOS, ALMS and
Integrated Capital Computation Module have been implemented/under implementation
Outside India and their references
Sr.
No.
Name and
complete
Postal
Address of
the
Customer
Brief Scope
of work
(specify the
size of the
bank, the
approaches
supported
etc.)
OEM
Partner
for the
project
Attach
reference
Letter
Contact
Details
(Name,
Designation,
Phone,
Email)
Project Status
(Completed/
Under
Implementation,
Start Date, End
Date)
(Enclose necessary documentary proof such as reference letter)
11.10.3 List of major customers where the proposed CRMS, ORMS, MRMS, LOS, ALMS and
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 232 of 250
Integrated Capital Computation Module have been implemented/under implementation
by the Bidder and OEM together and their references
Sr.
No.
Name and
complete
Postal
Address of
the
Customer
Brief Scope
of work
(specify the
size of the
bank, the
approaches
supported
etc.)
OEM
Partner
for the
project
Attach
reference
Letter
Contact
Details
(Name,
Designation,
Phone,
Email)
Project Status
(Completed/
Under
Implementation,
Start Date, End
Date)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 233 of 250
11.11 Performance Bank Guarantee Format
Bank Guarantee No.
Bank Guarantee Amount
Expiry Date
Claim Period
Account
GUARANTEE FOR PERFORMANCE OF CONTRACT/AGREEMENT
THIS GUARANTEE AGREEMENT executed at ________ day of_____________ Two
Thousand Ten
BY:
______________________ Bank, a body corporate constituted under _______________,
having its Registered Office/ Head Office at ______________, and a Branch Office
at_____________________________________________________ (hereinafter referred
to as “the Guarantor”, which expression shall, unless it be repugnant to the subject,
meaning or context thereof, be deemed to mean and include its successors and assigns)
IN FAVOUR OF:
Canara Bank, a body corporate, established under the Banking Companies (Acquisition
and Transfer of Undertakings) Act 1970 and having its Registered Office at 112, J. C. Road
Bangalore 560002 (hereinafter referred to as “Bank” which expression shall unless it be
repugnant to the subject, meaning or context thereof, be deemed to mean and include
its successors and assigns),
WHEREAS Bank had called for the bids for providing risk solutions for implementing
Enterprise Wide Integrated Risk Management Architecture under Basel II and III for
the Bank and its Group Entities and for the purposes M/s……………………… have been
appointed as the Vendor (hereinafter referred to as "Vendor") and accordingly has
entered into Contract / Agreement on ……….. (Agreement) with Bank subject to the
terms and conditions contained in the said documents and the Vendor has duly confirmed
the same.
AND WHEREAS pursuant to the Bid Documents, the Agreement, and the other related
documents (hereinafter collectively referred to as “the said documents”, the Bank has
agreed to avail from M/s……………………. and M/s……………………………. has agreed to
provide to the Bank, the Services / Systems / IRMA, more particularly described in the
Schedule/Annexure to the said documents (hereinafter collectively referred to as “the
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 234 of 250
Purchases”), subject to payment of the contract price as stated in the said documents and
also subject to the terms, conditions, covenants, provisions and stipulations contained the
said documents.
AND WHEREAS the Vendor has duly signed the said documents.
AND WHEREAS in terms of the said documents, inter alia, the Vendor is required to
procure an unconditional and irrevocable performance Bank guarantee, in favor of
the Bank, from a Bank acceptable to the Bank for a sum of
Rs…………………(Rupees…………………………………………………….. Only) being ---% of the total
contract value for the faithful observance and performance by the Vendor of the terms,
conditions, covenants, stipulations, provisions of the Agreement /the said documents.
AND WHEREAS at the request of the Vendor, the Guarantor has agreed to issue the
guarantee in favor of the Bank for a sum of Rs.……………………….
(Rupees………………………………………………..Only) being the --% of the total Contract value
AND WHEREAS at the request of the Vendor, the Guarantor has agreed to guarantee the
Bank that the Vendor shall faithfully observe and perform the terms of the said documents
NOW THEREFORE THIS AGREEMENT WITNESSETH AS FOLLOWS:
In consideration of the above premises, the Guarantor hereby unconditionally, absolutely
and irrevocably guarantees to the Bank as follows:
(1) The guarantor hereby agree and guarantee that the Vendor shall faithfully observe
and perform all the terms and conditions stipulated in the Contract/Agreement and the said
documents.
(2) The Guarantor hereby guarantees and undertakes to pay, on demand and without
demur, reservation, contest, recourse or protest or without any reference to the
Vendor, to the Bank at its office at Bangalore forthwith, and all monies payable by
the vendor to the extent of Rs.………………………………………. against any loss, costs,
damages, etc. suffered by the Bank
on account of default of the vendor in the faithful observance and performance of
the terms, conditions, covenants, stipulations, provisions of the Agreement / said
documents, without any demur, reservation, contest, recourse or protest or without any
reference to the Vendor. Any such demand or claim made by the Bank, on the
Guarantor shall be final, conclusive and binding
notwithstanding any difference or any dispute between the Bank and the Vendor or any
dispute between the Bank and the Vendor pending before any Court, Tribunal,
Arbitrator, or any other authority.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 235 of 250
(3) The Guarantor agrees and undertakes not to revoke this Guarantee during the currency
of these presents, without the previous written consent of the Bank and further agrees
that the Guarantee herein contained shall continue to be enforceable until and unless it is
discharged earlier by the Bank, in writing.
(4) The Bank shall be the sole judge to decide whether the Vendor has failed to perform
the terms of the Agreement / said documents for providing the Services by the Vendor
to the Bank, and on account of the said failure what amount has become payable by the
Vendor to the Bank under this Guarantee. The decision of the Bank in this behalf shall be
final, conclusive and binding on the Guarantor and the Guarantor shall not be entitled to
demand the Bank to establish its claim under this Guarantee but shall pay the sums
demanded without any objection, whatsoever.
(5) To give effect to this guarantee, the Guarantor will be deemed to be the Principal
Debtor to the Bank.
(6) The liability of the Guarantor, under this Guarantee shall not be affected by
(a) any change in the constitution or winding up of the Vendor or any absorption, merger or
(b) amalgamation of the Vendor with any other company, corporation or concern; or
(c) any change in the management of the Vendor or takeover of the management of the
Vendor by the Government or by any other authority; or
(d) acquisition or rationalization of the Vendor and/or of any of its undertaking(s) pursuant
to any law; or
(e) any change in the constitution of Bank / Vendor; or
(f) any change in the setup of the Guarantor which may be by way of change in the
constitution,
(g) winding up, voluntary or otherwise, absorption, merger or amalgamation or
otherwise; or the absence or deficiency of powers on the part of the Guarantor to give
Guarantees and/or Indemnities or any irregularity in the exercise of such powers.
(7) This Bank guarantee shall be valid up to……………………….
(8) Notwithstanding anything contained in this Guarantee, the Guarantor hereby agrees
and undertakes to extend the validity period of this guarantee for a further period as
may be requested by the Bank, from time to time.
(9) This guarantee shall be binding upon us and successors -in -interest and shall be
irrevocable.
(10) For all purposes connected with this Guarantee and in respect of all disputes and
differences under or in respect of these presents or arising there from the courts of
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 236 of 250
Bangalore city where the Bank has its Registered Office shall alone have jurisdiction to
the exclusion of all other courts.
(11) Notwithstanding anything contained herein above
I. Our liability under this Bank Guarantee shall not exceed Rs ……………. (Rupees
……………………….. only)
II. This Bank Guarantee shall be valid up to…………….
III. We are liable to pay the guaranteed amount or any part thereof under this Bank
Guarantee only and only if you serve on us a written claim or demand on or before
………………… ( mention validity period + claim period)
IN WITNESS WHEREOF the Guarantor has caused these presents to be executed on the
day, month and year first herein above written as hereinafter appearing.
SIGNED AND DELIVERED BY
the within named Guarantor,
______________________,
by the hand of Shri.__________, its authorized official.
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 237 of 250
11.12 Manufacturers’ / Producers’ Authorization Form
Note: This letter of authority should be on the letterhead of all the original equipment
manufacturers and should be signed by an authorized person and having the power of attorney
to bind the manufacturer.
No. Date:
To:
General Manager,
Risk Management Wing, Canara Bank Head Office,
112, J. C Road
Bangalore - 560002
Dear Sir/ Madam,
Sub: Solution to Implement Enterprise-wide Integrated Risk Management Architecture under
Basel II & III
We who are established and reputable manufacturers/producers of ________________________ having factories / development facilities at (address of factory /
facility) do hereby authorize M/s ___________________ (Name and address of Agent) to submit
a Bid, and sign the contract with you against the above Bid Invitation.
We hereby extend our full guarantee and warranty for the Solution, Products and services
offered by the above firm against this Bid Invitation.
We also undertake to provide any or all of the following materials, notifications, and information
pertaining to the Products manufactured or distributed by the Bidder:
a) Such Products as the Bank may opt to purchase from the Bidder, provided, that this option
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 238 of 250
shall not relieve the Bidder of any warranty obligations under the Contract; and b) in the event of termination of production of such Products:
i. advance notification to the Bank of the pending termination, in sufficient time to permit
the Bank to procure needed requirements; and ii. Following such termination, furnishing at no cost to the Bank, the blueprints, design
documents, operations manuals, standards, source codes and specifications of the
Products, if requested.
We duly authorize the said firm to act on our behalf in fulfilling all installations, Technical support
and maintenance obligations required by the contract.
Yours faithfully,
(Name of Authorized Signatory)
(Designation) (Name of Producers)
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 239 of 250
11.13 Implementation Team Profile
11.13.1 Implementation Capability of the Bidder
Requirement Response
Current strength of employees in the bidder’s
organization with experience on the proposed product(s)
Current strength of employees in the bidder’s
organization with experience in similar projects
Certifications possessed by the Bidder in connection with
the quality of internal processes and services delivered/
methodology used in delivery
• Organization’s Competence for the Assignment:
• No. of Risk Management Professionals
• Proven track record and in-house technology skills for
supporting software by way of Availability of Quality
certificates (ISO / SEI/ CMM etc.)
11.13.2 Team Profile (SI & OEM)
Requirement Response
Name of each Member on the Project Implementation
Team (Starting with Engagement Manager and Overall
Person responsible for the project)
Designation and Role
Area of Expertise (Subject Matter Expert)
• Credit Risk
• Market Risk
• Operational Risk
• LOS
• ALM
• FTP
• Capital Computation
Role of Team Member – onsite or offsite. If onsite then
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 240 of 250
Requirement Response
no. of man days expected to spend onsite during the
implementation period
Organization Name (Bidder has to specify if the member
is a part of the Bidder’s organization or OEM’s
organization)
Professional Qualifications
Risk Management Experience with the bidding firm/OEM
in terms of areas and no of years of expertise
Risk Management Experience with other companies firm
in terms of areas and no of years of expertise (Mention if
he/she has worked with banks earlier)
IT Implementation and Project Management Expertise
with the bidding firm/ OEM in terms of years and areas of
expertise
IT Implementation and Project Management Expertise
with other companies in terms of years and areas of
expertise
Certifications and Accreditations including Membership
of any professional body
Details of similar projects handled with details of client,
representing which organization, role of the member
team or team leader etc. in India and Internationally
Experience of the resource in the implementation of the
Proposed solution offered in this Bid
Note:
• Include details of team members who will be involved in the project.
• Experience refers to the experience of the employee on either exactly the same product /
set of products being proposed or on similar projects.
• Proposed team structure with count, profile and skills to be provider by bidder along with
proposed solutions profile, #, skills) etc. to be provided in RFP response
• The bidder/OEM has to clearly define the role of each team member who will be a part of
the implementation project team. Once the team member has been committed by the
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 241 of 250
Bidder/OEM, the change of team members is subject to clause mentioned in section 5.14
Substitution of Team Members
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 242 of 250
11.14 Important Project Timelines
Project Milestone Timelines
Period for agreeing on terms of contract
and finalizing the terms of contract from the
date of communication of award of the
award of the contract and sharing of terms
of contract by the Bank
21 days
Period within which the successful Bidder
should sign the contract after agreeing on
the terms of the Contract
7 days
Period within which Performance Security
or amendment thereto is to be submitted
by the successful Bidder upon signing of the
contract
21 days (grace period of 4 days)
Project Period 7 Years
• Implementation Period – 1 Year
• Warranty – 1 Year
• AMC – 5 years
Timeline for delivery of hardware from the
date of signing of contract
6 weeks
Period for the entire solution to be ready
for commissioning after the award of
contract.
9 Months
(part of implementation period
mentioned above)
Trainings On request
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 243 of 250
11.15 List of Existing Applications
11.15.1 Details of Application/Software Packages being used by the Bank
SL.
No.
Name of Application/Software Package Name of the Group
/ Section
Deployed at
1 Home Loan Subvention Retail Banking
Division
Head Office
Facilities
Management
2 Credit Monitoring Format Credit
Administrative Wing
Head Office
Facilities
Management
3 Credit Sanction Reporting System Prime Corporate
Credit wing
Head Office
Facilities
Management
4 LAS - Loan Against Shares Credit Statistics
Section, RM Wing
Head Office
Facilities
Management
5 Package for Incident Reporting Operational Risk
Management
Department, RM
Wing
Head Office
Facilities
Management
6 Package for Monitoring Special Watch List
Accounts
Credit
Administrative Wing
Head Office
Facilities
Management
7 Central Scheme of Interest Subsidy on
Education Loan - Member Banks
Priority Credit Wing Data Centre,
DIT
8 Bad Debt Write Off Balance Sheet and
Central Accounts
section
Head Office
Facilities
Management
9 Sector Wise Credit Credit Statistics
Section, RM Wing
Head Office
Facilities
Management
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 244 of 250
SL.
No.
Name of Application/Software Package Name of the Group
/ Section
Deployed at
10 Flash (PSR-1) Package for MIP Section, HO and
MIPD Sections at ROs and COs
Management
Information
&planning
Head Office
Facilities
Management
11 Willful Defaulters & Defaulters List Recovery Wing Head Office
Facilities
Management
12 SWL (Special Watch List) Credit
Administrative Wing
Head Office
Facilities
Management
13 Package for Business Line Mapping RM Wing Head Office
Facilities
Management
14 Web Based MPL Package (Monthly
Profitability Statement)
Balance Sheet and
Central Accounts
Section
Head Office
Facilities
Management
15 Web based CIBIL Package (Credit Information
Bureau (India) Limited)
Recovery Wing Head Office
Facilities
Management
16 Continuous & Concurrent Audit Package Inspection wing Data Centre,
DIT
17 OPR Incident reporting & Monitoring
(Operational Risk)
RM WING Head Office
Facilities
Management
18 RCA2 (Return on Capital Adequacy) RM WING Head Office
Facilities
Management
19 ADF (Web-based Centralized application for
Automated Data Flow of RBI returns)
MIS & Research
Governance Section
Head Office
Facilities
Management
20 GEFU Utility (in lieu of the Excel Formats
provided to branches for GEFU upload in CBS)
IT Development Head Office
Facilities
Management
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 245 of 250
SL.
No.
Name of Application/Software Package Name of the Group
/ Section
Deployed at
21 CAB (Web based Centralized application for
tracking Claims against bank)
IT Development Head Office
Facilities
Management
22 Financial Supply Chain Management Financial Supply
Chain Management
DC & DR
Centre
23 Maintenance of Data Bases Data Centre
Management
Data Centre,
DIT
24 Data correction scripts in Databases Data Centre
Management
Data Centre,
DIT
25 Change Management requests Data Centre
Management
Data Centre,
DIT
26 System Patch at DC & DRC Data Centre
Management
Data Centre,
DIT
27 Incident reports Data Centre
Management
Data Centre,
DIT
28 Antivirus Report of Servers Data Centre
Management
Data Centre,
DIT
29 New Branch creations Data Centre
Management
SMS
30 User creations in CBS Data Centre
Management
SMS
31 Holiday marking in CBS Data Centre
Management
SMS
32 Module for Prime Minister’s Relief Fund Government
Business
Management
GROUP
DC,DRC
33 ADF(Automatic Data Flow) Application
package
Facilitates
Management Group
Data Centre,
DIT
34 Credit monitoring format ,Foreign Business
Turn Over, Portfolio Investment Scheme,
Business line mapping
Facilitates
Management Group
Data Centre,
DIT
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 246 of 250
SL.
No.
Name of Application/Software Package Name of the Group
/ Section
Deployed at
35 Premises data management system,
housekeeping return-online, Package for PPA
section, RCA2.
Facilitates
Management Group
Data Centre,
DIT
36 Credit Sanction reporting system Facilitates
Management Group
Data Centre,
DIT
37 Search engine for CBS customers, Home Loan
subvention, Service tax, Willful defaulter list.
Facilitates
Management Group
Data Centre,
DIT
38 Inspection wing branch application package Facilitates
Management Group
Data Centre,
DIT
39 Credit monitoring format ,Portfolio
Investment Scheme
Facilitates
Management Group
HOEDP
40 MIP Package, Basel-II Package, Loan against
share Package, PSR-II Package, Incident
reporting package, Sector wise gross credit
package,26QAA Package, Sick industry
rehabilitation Package, Monthly profitability
statement Package, security Package,
Customer service section Package, Advance
statement Package, Priority credit statement
Package, PRR75/77/78 Package, Chiefs
Package, ICI Package, NPA Package, PSR67
AND PSR71 package schemas.
Facilitates
Management Group
HOEDP Server
Room
41 Credit sanction reporting system, FBTO Facilitates
Management Group
Data Centre,
DIT
42 SWL A/C Monitoring, Search engine for CBS
customers, SWL, FIG Tracker, Package for PPA
Section, CHIP system.
Facilitates
Management Group
Data Centre,
DIT
43 Bad debt write off, Unclaimed deposits. Facilitates
Management Group
HOEDP
44 ADF Database Facilitates
Management Group
Data Centre,
DIT
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 247 of 250
SL.
No.
Name of Application/Software Package Name of the Group
/ Section
Deployed at
45 Flash package, Business line mapping package
for RM wing
Facilitates
Management Group
Data Centre,
DIT
46 OLD LEAVE DATA Facilitates
Management Group
Head Office
Electronic
Data
Processing
47 Datacap – Kondor+ Treasury Applications :
Front & Mid Office
Facilities
Management Group:
Disaster Recovery
Treasury
DC and DRC
Treasury
48 Datacap – Flexcube Treasury
Applications(Back Office)
Facilities
Management Group:
Disaster Recovery
Treasury
DC and DRC
Treasury
49 Datacap – Business Objects : Integrated
Treasury
Facilities
Management Group:
Disaster Recovery
Treasury
DC and DRC
Treasury
50 Automatic Lending Processing System Flexcubes Web based
package.
51 REMEDY APPLICATION CBS Helpdesk Data Centre,
DIT
11.15.2 Details of Application/Software Packages being used by Group Entities
Sl.
No
Name of the Group Entity Name of the Software Brief Description
1 Can Fin Homes Ltd IBS package Covering modules to handle
Home loans, deposits,
financial accounts
Credents ALM package
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 248 of 250
Sl.
No
Name of the Group Entity Name of the Software Brief Description
3 Canara Bank Securities Ltd Trade Any Where Online Trading Platform
Back Office : Lidha Didha Import of trade data and
processing of contract notes
plus office accounting
Avaya Software Call Centre
4 Can Bank Financial
Services Limited
TALLY ACCOUNTS
5 Can Bank Venture Capital
Fund Limited
Windows Server 2008
Standard Edition
Server Operating System
Windows XP Professional Operating System
Windows 7 Professional Operating System
MS Office 2003 & MS
Office 2010
Application like MS Word,
MS Excel, PowerPoint,
Outlook Express, MS
Outlook
Tally 9.0 ERP Accounting Software
EINTERACT 1.0 Email Messaging Solution–
Corporate email ids. Service
providers are Netcore
Solutions Pvt Ltd
Adobe Acrobat 8
Professional
To view, create, manage
files and securing of
important documents.
Symantec End Protection –
Small Business Edition
Symantec Anti Virus
Software
7 Can Bank Factors Limited E-FACTORING(CANBANK
FACTORING SYSTEM)
Software is developed using
Oracle 10g Data base as
back end platform and
Visual basic and ASP as front
end. It is integrated
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 249 of 250
Sl.
No
Name of the Group Entity Name of the Software Brief Description
software linking our
branches with Registered
office.
FOLKLORE - PAYROLL
PACKAGE
DELPHI software developed
on Oracle and ASP. Used for
salary processing of
company staff.
8 Canbank Computer
services Ltd
TALLY ACCOUNTS
9 Canara Robeco Asset
Management Co. Ltd.
V-connect – HR Portal
Cloud base application
from Adrenalin
Used for Attendance,
expense claim, Travel,
Reimbursement, Leave
management, & Company
policy document for
employee reference.
Employee Trade system To manage details of insider
trade – Tracking investment
of employees.
SUN – Accounting ERP AMC accounting
Bloomberg AIM Used by from office and
back office to manage day
to day investment business.
CRISIL Bond Valuation –
Third party Database
Used by Front office for
Bond valuation
10 Kerala Gramin Bank Finacle Finacle 7.0.18
11 Pragathi Gramin Bank Finacle Finacle 7.0.18
CANARA BANK
(HO: Bangalore)
RFP for Solution to Implement
Enterprise-wide Integrated Risk
Management Architecture
under Basel II & Basel III.
RFP NO. RMW/01/2013-14 dated 10/07/2013
Page 250 of 250
11.16 Data Center and Disaster Recovery Site of Group Entities
Sl.
No
Name of the Group Entity Data Center Disaster Recovery
Centre
1 Can Fin Homes Ltd Bangalore Chennai
2 Canara Bank Securities Limited Mumbai No Separate DR Site.
Back Up is stored in
a locker hired from
another bank in
Moscow.
3 Can Bank Venture Capital Fund
Limited
Bangalore Bangalore
4 Can Bank Factors Limited Bangalore Bangalore
5 Can Bank Computer Services
Limited
Bangalore Off Site Storage in
Bangalore
6 Canara Robeco Asset
Management Company Limited
Mumbai Bangalore
7 Kerala Gramin Bank Bangalore Mumbai
8 Pragathi Gramin Bank Bangalore Mumbai
End of Document