Bankers Trust Rolls Risk System To New York, London; Tokyo Next

Bankers Trust is in the process of rolling out a proprietary global risk management system based on object-oriented database technology to traders and risk managers in New York.

The Bankers risk system-built around Boston-based Object Design's Objectstore database-already supports some 25 traders at the bank's London and New York offices. This phase of the installation was completed earlier this year, according to Bankers officials.

The second phase of the implementation is now underway and covers another 25 traders at Bankers Trust New York. The Tokyo installation of the risk system is scheduled to start shortly thereafter. The Bankers risk management system will ultimately cache data from some 20 trading systems in the bank's London, New York and Tokyo offices.

Colin Savery, the Bankers Trust vice president in charge of the project, declines to comment in detail on the risk system. However, in a prepared statement, Savery says Bankers required a fast, flexible database that could be brought on-line quickly. The bank judged that it could save development time by using Objectstore rather than its object-oriented or relational competitors, he says.

Jim Beagle, Object Design's vice president of European operations, says Bankers Trust's risk management system is written in C++ using Objectstore as its underlying repository. "They're trying to handle very complex information, but they want high performance in terms of delivering information to their trading systems," he says.

Beagle says Bankers is performing its development in a "heterogeneous" environment including two different operating systems: Digital Equipment Corporation's version of Unix and Microsoft's Windows NT. Much of the initial development work was done under NT, he adds. Bankers officially selected Objectstore in March and began its rollout in August, some six months later. Beagle says this rapid timeframe was part of Bankers' original specification.

Lehman Brothers (Trading Systems Technology, May 27) and Nomura International (Risk Management Operations, January 29) are also using Objectstore as part of their risk management systems. But Bankers Trust's implementation of Objectstore is more comprehensive than either Nomura's or Lehman's. Specifically, Bankers is using Objectstore as both a front-end and a back-end data repository. In contrast, Nomura and Lehman are deploying Objectstore as a client-side database for traders' workstations, with links to a traditional Sybase relational database server.

Bankers Trust is using "a more pure object database approach for this application," says Beagle. He claims this purely object-oriented methodology allows faster performance and shorter development times.

Object Design officials add that the Bankers contract is worth some $420,000. A Bankers spokesperson adds that the bank's global risk management is headed up by Daniel Mudge, a senior managing director. This risk group has staff in North America, Europe and Asia. Mudge's group is responsible for monitoring and reporting the risks that the bank is taking on a worldwide basis. The risk management group was formalized under Mudge in 1987, says the Bankers spokesperson, and covers market, credit and operational risk management. Bankers also runs a risk management advisory service for its clients (RMO, January 15). This group is headed by Lee Barba at the bank's New York head office. Barba reports to Yves de Balmann, head of Bankers' combined risk management products and services group.