Banco Galicia: Optimizing Cash Operations
Guest blog by Eric Stine, Senior Vice President & General Manager, Financial Services, SAP Americas
During the SAPPHIRE NOW 2013 Financial Services Forum, Banco de Galicia y Buenos Aires S.A. discussed their project to optimize cash operations.
Banco Galicia undertook a two-phase cash management and optimization project that began in December 2010 and ended in August 2012: phase 1 (December 2010 to December 2011) focused on cash logistics execution and phase 2 (January 2012 to August 2012) focused on cash planning and optimization. The goal was to achieve significant cost reduction and improve cash management operations, with the scope covering branch network and ATM prevision needs and facilitating the exchange of surplus cash between banks. The rollout stages included
- Legacy front-end (workflow) and spreadsheet replacement by SAP CMO
- Cash transportation providers integrated with Galicia’s SAP CMO
- Forecast of demand and cash surplus
- Planning proposals for sends and cash withdrawals
- Online information to centralized areas and bank management for improved decision making
At the end of the project, Banco Galicia realized these benefits:
- Improved visibility of cash availability across network (branches, ATM’s, etc.)
- Integrated cash demand planning and cash replenishment processes
- Reduced opportunity costs of keeping immobilized cash flows
- Decreased administrative and transportation costs related to cash handling
- Improved ability to negotiate and control cash transportation and security services
- Improved operating efficiency, customer service level, and abillity to adapt to regulations (reduced time to market)
With the implementation of SAP CMO, Banco Galicia recovered nearly $3.5 m AGS due to improved cash transportation billing controls and over $1.7 m AGS due to improved efficiencies. Further identified opportunities are projected to save $17.8 m AGS.
What experience do you have with optimizing cash operations? What were the key challenges and outcomes?
About Banco Galicia
Founded in 1905, Banco de Galicia y Buenos Aires S.A. is one of the largest private sector banks in the Argentine financial system and a leading financial services provider with 6.3 million customers, 2.6 million deposit accounts and 9.8 million of credit cards. Banco Galicia ranked third in terms of assets and deposits and second in terms of its loan portfolio within private-sector banks. Banco Galicia operates one of the most extensive and diversified distribution networks among private-sector banks in Argentina, offering 257 bank branches, +820 ATM’s and other 470 points of contact with clients