IBS Journal March 2015


Dion Global Solutions turns a corner with Q3 results


India-based Dion Global Solutions has reported a net profit of INR 18.5 million ($296,608) for the third quarter ending 31st December 2014 compared with a post-tax net loss in the previous Q3 of INR 246.4 mil- lion ($3.95 million). Total income rose 35.4 per cent to INR 807.4 million ($12.95 mil- lion). The announcement on the Bombay Stock Exchange saw the company’s share price increase on the day by 5.4 per cent to INR 83 ($1.33). The company has a broad product set,


in part through a series of acquisitions over the years. The most recent deal saw the takeover in September 2014 of the compa- ny’s previously part-owned Germany-based subsidiary, SwissRisk Financial Systems (Dion had bought a controlling interest in January 2012). Sales of a number of Swiss- Risk-derived solutions are cited as one rea- son for the recent pick-up. SwissRisk brought a messaging sys-


tem, X-Gen, which is sold as a product in its own right but also underpins a number of other offerings including a SEPA gate- way (Hauck & Aufhäuser Privatbankiers in Germany and the Slovakian arm of Erste Bank, Slovenska Sporitelna, are among the


banks to have gone live with this in the last twelve months). X-Gen is also used for a FATCA system which Dion claims has now been taken by 13 clients across five conti- nents, with Scotiabank in Canada believed to be the latest to sign. And the messaging system is also within a recently launched corporate actions processing system called Jade; a case management system, GCM; and a market clearing messaging engine, D-Clear. D-Clear is part of Dion’s post-trade


suite, which includes the long-standing Nova for institutional and retail investment settlement. Much of the recent activity has been in Singapore, where six clients have taken D-Clear, although Dion has not bene- fitted from a delay in the project by the Sin- gapore Exchange (SGX) to replace its cen- tral settlement platform, CAS. Since 2012, Dion has been working with four brokers that signed for Nova and will use D-Clear for the connectivity. Dion added an ‘inter- national clearing bank’ as its sixth client in December 2014, says John Brierly, Dion’s head of post-trade products and Asia oper- ations. The latter is the first in Singapore to take D-Clear without Nova, as it has a


separate settlement system. The documentation for the second phase of the SGX project, centred on the full replacement of the central platform, has just been released. ‘A problem with a programme of this size is that we are totally dependent on the exchange for the time- lines,’ says Brierly. The original live date was May 2015 but this has now slipped, with SGX stating that users must be connected to the new platform by 31st January 2016, with a window prior to this to do so from October 2015. Two of Dion’s clients are already live with Nova and Brierly expects five of the six to go into production with connectivity to the new system in January of next year. With this sort of initiative, no one wants to be the last nor the first, he points out. Institutional brokers are more relaxed about the changes than their retail counterparts, he adds, because the latter have much more complex processing. Brierly says Dion is talking to another


three potential market entrants and sees additional opportunities as sub-agent par- ticipants, particularly the domestic custodi- ans, have to connect to the central deposi- tory platform, probably in H2 2016. There are other changes in the region


IN BRIEF


Commercial Bank of Djibouti (CBD), a start-up bank, is implementing the Autobank- er core banking system from Pakistan-based software vendor, Autosoft Dynamics. In addition, the vendor is supplying its Autocredit product for credit management (cor- porate banking), Adams for treasury management and Autotrade for trade services. The project is the first in Djibouti for Autosoft. The vendor’s team is currently onsite working on the implementation. The con-


tract was signed at the end of last year, and the plan is to go live with the core mod- ules by the end of March 2015. The remaining functionality will be live by June 2015, according to the vendor. The project consists of standard phases, starting with gap analysis, parameterisation and minor customisation, then product development and training, deployment of supporting modules, parallel run and beta testing, culminat- ing in the final cutover. No third parties are involved in the implementation. ‘We have always undertaken the implementation of our product suite ourselves as we have all the core expertise available in-house,’ emphasises Autosoft’s spokesperson. Djibouti has a population of around one million. At present, there are ten con-


ventional and four Islamic banks in the country. ‘We are looking to expand our foot- hold in the country after our first successful implementation,’ says the spokesperson. ‘Technology awareness is growing at a fast pace across Africa and we anticipate a rise in demand for core banking software in Djibouti and elsewhere in Africa. We are already serving seven banks in the region, with Tanzania, Somalia, Sudan and Ethio- pia being other promising markets for us.’


that should also generate more business. In Hong Kong, for instance, the CCAS clearing system was adapted in Q4 2014 to allow trading and settlement of Shanghai-list- ed securities, with more enhancements to come. In Indonesia, there are moves by the stock exchange to standardise back office processing and controls. And the Austral- ia Securities Exchange (ASX) has recently announced that it will move to ISO mes- saging for its Clearing House Electronic Subregister System (Chess). These sorts of market changes require enhancements for existing users (there are 20 or so users of Nova in the region) and can generate new sales. In terms of Dion’s overall perfor-


mance, in a statement to coincide with the results, global CEO and MD, Ralph Horne, said, ‘the figures we are reporting today are as a result of our dedicated focus on re-strengthening our core products, intro- ducing new products into the marketplace and the implementation of cost saving measures that were initiated earlier this financial year’.


18 © IBS Intelligence 2015 www.ibsintelligence.com


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