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 SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT Implementation New York Cash Exchange June 1: 4: 00 -5: 00 pm

Discussion Points • • 2 About SWIFT A Real-Life Case Study: Met. Life Final Discussion Points • • 2 About SWIFT A Real-Life Case Study: Met. Life Final Words of Advice Q&A Session Proprietary Information of Bank. Serv

About Bank. Serv Premier Provider of Electronic Payments & Messaging Solutions 2 nd largest About Bank. Serv Premier Provider of Electronic Payments & Messaging Solutions 2 nd largest provider of SWIFT Certified interfaces worldwide • The Company • Founded in 1996 • Over 176 employees • Headquarters and data center in Las Vegas, NV • Operations and offices in San Francisco, Salt Lake City and London • Over 450 Clients (SWIFT, Fed, ACH) in 52 countries • Local Support – 23 distributors, 5 continents, 52 countries One of the Fastest Growing Companies in US • Silicon Valley Deloitte Technology Fast 50 • Deloitte and Touche Fast 500 – two consecutive years • Inc. 500 - two consecutive years • ICIC’s Top 100 fastest-growing urban companies in America * - Hall of Fame in 2009 * Initiative for a Competitive Inner City 3 Proprietary Information of Bank. Serv

SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT Implementation About SWIFT Presented by: Mary Ellen Putnam, Bank. Serv 4 Proprietary Information of Bank. Serv

Typical Corporate Requirements Multi-National Corporate: • Operating in a number of countries and continents Typical Corporate Requirements Multi-National Corporate: • Operating in a number of countries and continents – Europe, Asia, North and South America • Multiple bank partners for SWIFT – Each Bank Partner and its multiple country affiliations has a slightly different requirement for message/file types • Variety of systems and protocols used for bank communications/transactions – High cost to operate and maintain • Multiple message types that need to be exchanged – MT 101, MT 50 x, MT 94 x, EDI 820 files, I-Files, XML, BAI , etc. • Treasurers need better visibility of cash positions and management 5 Proprietary Information of Bank. Serv

Typical Corporate Bank Connectivity Corporate responsible for multiple protocols, standards & systems. Corporate Responsibility Typical Corporate Bank Connectivity Corporate responsible for multiple protocols, standards & systems. Corporate Responsibility Office Systems Payment Processing & Settlement VAN Host to host Leased Line Cash Management & Reporting e-banking Treasury Operations Other Strategic Operations Internet e-banking PSTN fax-banking 6 Proprietary Information of Bank. Serv

Why SWIFT? What is SWIFT? • • A worldwide network that enables financial messaging Why SWIFT? What is SWIFT? • • A worldwide network that enables financial messaging between banks, financial institutions…and now corporations Used by over 8, 300 banking organizations, securities institutions and corporate customers Benefits • One portal for communication with all banking partners, one process for exchanging data – that can replace multiple protocols, systems and standards commonly used by corporations for multi-bank communications • • 7 Lower transaction charges Enhanced security, reliability and STP of all financial information One standard set of Global Financial Messaging Processes, connections, message formats Reliable platform for future requirements Proprietary Information of Bank. Serv

Corporates on SWIFT Growing Substantially Geographical split # registered corporate entities 726 Q 4 Corporates on SWIFT Growing Substantially Geographical split # registered corporate entities 726 Q 4 2010 Asia Pacific Americas EMEA 8 Source: SWIFT Partner Meeting La Hulpe – 2011 8 Proprietary Information of Bank. Serv

SWIFT Connection Model Single channel for multi-bank communications replaces proprietary multibank system and enables SWIFT Connection Model Single channel for multi-bank communications replaces proprietary multibank system and enables bilateral straight-through processing. Corporation Office Systems Payment Processing & Settlement Treasury Management System SWIFT Security Operations Single Gateway Other Strategic Operations 9 Proprietary Information of Bank. Serv

Service Bureau Model: Benefits • Lower cost of entry • Lower total cost of Service Bureau Model: Benefits • Lower cost of entry • Lower total cost of ownership : – Reduces labor, transaction and operations costs – By up to 70 -80% • SWIFT Expertise and Experience • Rapid deployment – Using Service Bureau’s existing expertise and infrastructure • Project management and implementation expertise • Disaster recovery support • Additional services readily available when/if needed: – Archiving – Compliance checking and filtering – Data transformation/translation technology 10 Proprietary Information of Bank. Serv

Example of SB Architecture Single Channel, Multi-Bank Communications…and Lower Total Costs …. Connectivity, Professional Example of SB Architecture Single Channel, Multi-Bank Communications…and Lower Total Costs …. Connectivity, Professional Support provided and maintained by SB Cash Management & Reporting Treasury Operations T 1 Service Bureau M Payment Processing & Settlement 0 x Corporation BA SWIFT FIN Processing Data Translation EDI 820/831 SWIFT Payment Mapping File. Act Processing EDI 824/997 MT 9 40 XM L Other Strategic Operations 11 Proprietary Information of Bank. Serv I

SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT Implementation The Met. Life Case Study Presented by: Frank Campione, Met. Life 12 Proprietary and Confidential Information of Met. Life

About Met. Life • A leading provider of insurance, annuities, and employee benefit programs About Met. Life • A leading provider of insurance, annuities, and employee benefit programs – – – Ranked #46 on the Fortune 50, based on 2010 performance $35. 8 billion in premiums, fees and other revenues for 2010 90 million customers in over 60 countries Headquarters in New York City Approximately 66, 300 employee as of December 31, 2010 • Need to exchange various types of financial payment, transaction and messages types with our banks worldwide – 11 primary bank relationships – Hundreds of additional bank relationships 13 Proprietary Information of Bank. Serv

Met. Life’s Old Banking Communications • In 2005, Met. Life started to consolidate banking Met. Life’s Old Banking Communications • In 2005, Met. Life started to consolidate banking connections to: – Reduce operating costs – Improve overall treasury operations • As part of this, we converted to a single multi-bank processing system – Provided by one banking relationship 14 Proprietary Information of Met. Life

Multi-Bank Processing System: 2005 Multi-Bank Processing System only offered a way to send out Multi-Bank Processing System: 2005 Multi-Bank Processing System only offered a way to send out payments and general message format types. Met. Life Back-Office Treasury Management System Multi-Bank Processing System 15 Proprietary Information of Met. Life

Issues with Multi-Bank System • High transaction fees • No straight-through processing • Could Issues with Multi-Bank System • High transaction fees • No straight-through processing • Could not receive back bank confirmations – Key to obtaining Fed Reference numbers to validate payment confirmations • Inefficient process for on-boarding new banks – Required separate agreement with each bank, costing time and money 16 Proprietary Information of Met. Life

Why Met. Life Needed SWIFT Benefits to Met. Life • A highly secure, reliable Why Met. Life Needed SWIFT Benefits to Met. Life • A highly secure, reliable alternative to the bank’s multibank processing system • Lower transaction costs by avoiding the higher transaction fees charged by the bank’s proprietary multibank processing system • Straight-through processing for all message formats and data: – Both to Met. Life’s banks and coming from the banks. • Established a bank agnostic standard, enabling Met. Life to quickly establish or discontinue banking relationships 17 Proprietary Information of Met. Life

SWIFT Evaluation: Goals • Determine how to gain the lowest transaction fees • Enable SWIFT Evaluation: Goals • Determine how to gain the lowest transaction fees • Enable the sending and receiving of all required message types – Including payments (MT 101, MT 103, MT 202), bank confirmations (MT 900, MT 950), but also ACH files and custodial statements (MT 535, MT 536) • Streamline and expedite bank on-boarding requirements and procedures • Establish the most timely and cost-effective approach that would not interfere with operations • Determine opportunities for other business areas, such as Met. Life’s Securities division, to benefit from straightthrough processing and SWIFT 18 Proprietary Information of Met. Life

Approaches Considered • In-House Connection • SWIFT Member Administered Closed User Group (MA-CUG) • Approaches Considered • In-House Connection • SWIFT Member Administered Closed User Group (MA-CUG) • SWIFT Service Bureau 19 Proprietary Information of Met. Life

Met. Life Considerations What did Met. Life Already Have? • Existing experts in project Met. Life Considerations What did Met. Life Already Have? • Existing experts in project management, IT and treasury operations • Treasury management system that could process basic SWIFT messages • Skills/staff to develop our own message transformation middleware application and support Considerations: • SWIFT membership options: full member, SCORE, MA-CUG, IMI • Upfront and ongoing costs to maintain in-house SWIFT connection • Time required to build a network from scratch or set-up a MA-CUG relationship with all our banks • Need for SWIFT advice and guidance – new language, message formats, operation rules, network procedures • A dedicated team required to run a SWIFT operation 20 Proprietary Information of Met. Life

Costs to Consider Cost SWIFT • SWIFT Membership • Connectivity/Software • Traffic • • Costs to Consider Cost SWIFT • SWIFT Membership • Connectivity/Software • Traffic • • NON-SWIFT 21 Percent of Total Cost 20% Project Management Infrastructure & Operations Application Integration Ongoing costs for: – – – Format transformations Disaster Recovery Upgrading Documentation Backup Compliance Proprietary Information of Met. Life 80%

Service Bureau Model: Benefits A Fully Outsourced and Managed SWIFT Service Bureau (provided by Service Bureau Model: Benefits A Fully Outsourced and Managed SWIFT Service Bureau (provided by Bank. Serv) • Reduction in upfront and ongoing costs, due to not having to purchase/support our own in-house infrastructure. • SWIFT expertise and support to ensure cost-effective and timely implementation • All hardware, software and support services required • Single point project management and implementation of the service bureau • Access to professional development of all format and routing requirements • Integrated RMA (Bank Relationship Management) support to more rapidly establish new bank requirements and security authorization • 24/7 customer service and technical support • Ongoing support for disaster recovery, upgrades, standard changes and general maintenance 22 Proprietary Information of Met. Life

Met. Life Technology Set Integrated Technology • Bank. Serv Turbo. Swift for processing of Met. Life Technology Set Integrated Technology • Bank. Serv Turbo. Swift for processing of all SWIFT FIN formats • Bank. Serv Turbo. File. Act for File. Act service processing for all other formats • Met. Life provided the format transformation middleware for payment mapping, format transformation, and destination logic • Bank. Serv integrated with this 23 Proprietary Information of Met. Life

Met. Life’s New SWIFT Connection Single Channel, Multi-Bank Communications…and Lower Total Costs …. Connectivity, Met. Life’s New SWIFT Connection Single Channel, Multi-Bank Communications…and Lower Total Costs …. Connectivity, Professional Support provided and maintained by SB F T P M Bank. Service Bureau Treasury Management System Met. Life Middleware T 1 0 x Met. Life BA SWIFT FIN Processing EDI 820/831 SWIFT File. Act Processing EDI 824/997 MT 9 2 X XM L Disaster Recovery 24/7 Tech & CS Support 24 Proprietary Information of Met. Life I

Implementation: Key Players • Met. Life – Treasury Management: approximately 2 FTE – IT: Implementation: Key Players • Met. Life – Treasury Management: approximately 2 FTE – IT: approximately 2 FTE, including the Master Project Manager, who created and managed the master project plan and coordination with all 11 banks, including developers for the development of the format transformation middleware • SWIFT • Bank. Serv – Project Manager – Implementation Manager • The Banks – 11 primary – Each had their own project managers, as well as teams of specialists for each area, such as ACH, EDI, SEPA and reporting 25 Proprietary Information of Met. Life

Implementation: Phase 1 Timeline January/February 2009: • • Conducted project and cost-benefit analysis, focused Implementation: Phase 1 Timeline January/February 2009: • • Conducted project and cost-benefit analysis, focused on treasury but also considering opportunities within other business areas throughout the company Issued RFP to qualified SWIFT service bureau providers Worked with winning SB on contract Requested SWIFT membership: IMI (Investment Management Institution) category September 2009: • • • Established SWIFT Membership as an IMI Finalized Service Bureau (SB) contract and started implementation with SB Started working with Bank. Serv, who provided advice on SWIFT and formatting requirements October-December 2009: • • • 26 Focused on FIN messaging User Acceptance Testing (UAT) and production testing, using a rolling schedule with requirements being done for one bank, while another bank is already in UAT Completed SWIFT Implementation for 11 tiered banks Proprietary Information of Met. Life

Implementation: Key Success Factor • Developed a thorough project plan, detailing due dates, all Implementation: Key Success Factor • Developed a thorough project plan, detailing due dates, all inter-related tasks and format/data requirements per bank and country • Contacted our banks to discuss technical, process and testing needs before firming up their timelines and requirements • Assigned an overall project manager in addition to the project manager required and provided by the Bank. Serv SWIFT service bureau • Created a phased-in approach, focused on 1 -2 banks and one message type at a time • Implemented a rolling production schedule, based on tight production monitoring. In this case, a rolling schedule means, you can determine the requirements for one bank, while you are working on the actual UAT and production testing and go-live for another • Strong teamwork across Met. Life’s business units, Bank. Serv and the banks 27 Proprietary Information of Met. Life

Implementation: Key Challenges • Working with the banks: – Some banks were not prepared Implementation: Key Challenges • Working with the banks: – Some banks were not prepared to work with non-bank corporations. and could not process File. Act files. – About 50% could not do UAT testing per Met. Life’s deadlines and other requirements. As a result, Met. Life had to adjust schedules and compromise with the banks • Establishing membership: – IMI (Investment Management Institutions) membership took longer than expected due to contractual delays between legal parties • Contracts also took longer because the terms had to be mutually agreed-upon between all parties 28 Proprietary Information of Met. Life

Since 2009… • 2010 Implementations – Separate Account Activity – Supported AP ACH/BAC files Since 2009… • 2010 Implementations – Separate Account Activity – Supported AP ACH/BAC files in the UK – Facilitated global payments for Alico integration • 2011 Planned Implementations – Trade Settlements – Asset Reconciliations – E-BAM Pilot 29 Proprietary Information of Bank. Serv

Summary of Results • Forecasted IRR of 69. 5% • Straight-through processing (bilaterally) for Summary of Results • Forecasted IRR of 69. 5% • Straight-through processing (bilaterally) for all of our current and future payment and other financial message format types and data • Reduced transaction fees by 75% • Streamlined and expedited bank on-boarding requirements and procedures • On-time and on-budget SWIFT implementation • Improved overall treasury and IT operations 30 Proprietary Information of Met. Life

 SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT for Corporates The Met. Life Case Study and Strategies for a Successful SWIFT Implementation Final Words of Advice Presented by: Mary Ellen Putnam, Bank. Serv

Final Words of Advice • • Determine sound business objectives and make sure they Final Words of Advice • • Determine sound business objectives and make sure they align with the benefits achievable from a SWIFT implementation Develop a phase 0 to establish: – – • • Written documentation of the objectives and requirements Format, data and testing requirements by bank and country Timeline that considers all related projects and sub-projects List of all key players and tasks Communicate and collaborate with all stakeholders, internal and external, before solidifying plans and timelines Assign an overall project manager to manage all projects and bank relationships Develop a comprehensive project plan for implementation, detailing the realistic timeline and tasks Consider a phased-in approach: – One set of banks at a time – One format at a time, starting with FIN (a more straight-forward format already accepted by the banks) for domestic and then by each foreign country; followed by other formats, such XML and other proprietary formats.

Q&A Please feel free to ask questions 33 Proprietary Information of Bank. Serv Q&A Please feel free to ask questions 33 Proprietary Information of Bank. Serv

Thank You Please feel free to contact Bank. Serv through: Mary Ellen Putnam Bank. Thank You Please feel free to contact Bank. Serv through: Mary Ellen Putnam Bank. Serv 333 Bush Street, 2 nd Floor San Francisco, CA 94104 (415) 632 -1870 maryellen. [email protected] com