KARNATAKA STATE COOPERATIVE APEX BANK LIMITED



| |

|EXPRESSION OF INTEREST (EOI)FOR THE |

|SUPPLY, IMPLEMENTATION AND MAINTENANCE |

|OF A CORE BANKING SYSTEM |

1. GENERAL INFORMATION

1. INTRODUCTION

The Karnataka State Cooperative Apex Bank Limited (hereinafter referred to as “the Bank”) is a Scheduled Cooperative Bank incorporated under the Karnataka State Cooperative Societies Act 1959. It was established in the year 1915 and is meant to act a Apex Body to finance Agriculture sector through the District Central Cooperative Banks and Primary Agricultural Cooperative Societies. In the later years the Apex Bank diversified its activities into commercial banking. Today it has 31 branches in Bangalore City through which it carries out commercial banking activities. It does not have any branches outside Bangalore.

The Bank intends to implement Core Banking System (CBS) in all 31 branches including Head Office and now invites companies and firms which are developers of Core Banking Software and have ownership of the various proprietary rights attaching thereto, to submit their responses. The Core Banking Software should among others, facilitate improvement, efficiency and productivity of customer service, availability of management information and enhancement of product development. The solution must not be restrictive to operating environment, it should be possible to deploy in a heterogeneous environment of OSS and hardware. The bank would preferentially not wish to incur any expenditure other than the cost of the solution itself, excepting for such hardware it does not currently have.

This document constitutes the formal Request for Expression of Interest (EOI) for the supply, implementation and maintenance of a Core Banking System (CBS) and is being availed on an open tender basis to companies or firms (hereinafter referred to as “the respondents(s)”) which are developers of core banking software and have ownership of the various proprietary rights attaching thereto and are interested in submitting a response.

2. Objective of the Expression of Interest (EOI)

The objective of the EOI is to shortlist vendors who would later be invited to submit detailed technical and financial tenders for the supply, implementation and maintenance of a Core Banking System (CBS) that supports both the functional and technical requirements of the Bank.

The Core Banking System being sought by the Bank is expected to assist the Bank :

Ø Improve its operational efficiency and effectiveness

Ø Reduce its operational costs

Ø Improve its productivity and profitability

Ø Improve customer service

Ø Enhance the development of new products

Ø Enhance the availability of management information

Ø Enable complete integration with other IT systems

Ø Provide faster and easier availability of customer relationship management

facility.

Ø Quicker time to market.

3. Format of EOI response and instructions to bidders

The overall summary information regarding the Core Banking Software selection is given in section 1.2 – Objective of the Expression of Interest (EOI). The respondents shall include in their response any additional services or items considered necessary for the successful completion of the project.

Responses to the EOI from respondents should be submitted in a common sealed envelope, super scribed with the words :

“EXPRESSION OF INTEREST FOR THE SUPPLY, IMPLEMENTATION AND MAINTENANCE OF CORE BANKING SYSTEM ”

Respondents should provide one (1) hard copy and one (1)electronic (soft) copy of the response to the EOI and CD. Responses to Section 5 – INFORMATION REQUIRED should also be submitted in the provided Microsoft Excel Format.

1. The response to the EOI should contain the following:

a) Profile of the company/firm as outlined in Section 5.1.

b) List of products and services offered by company / firm as outlined in section 5.2.

c) List of reference sites as outlined in section 5.3.3.

d) Copies of the last three years audited financial statements

e) Copy of the certificate of incorporation

f) Product brochures (technical and user)

2. The response documents shall be addressed to :

The Secretary,

The Karnataka State Cooperative Apex Bank Ltd.,

No.1, Uthunga, Pampamahakavi Road,

Chamarajpet,

Bangalore -560 018.

Please note that responses received by facsimile or electronic mail will be rejected.

1.3.3. The bank reserves the right to accept or to reject any response and to annul the process and reject all responses at any time prior to the award of the contract, without thereby incurring any liability to any respondent or any obligation to inform the respondent of the grounds for its action.

4. Cost of responding

The respondent shall bear all costs associated with the preparation and submission of its response and the Bank will in no case be responsible or liable for those costs, regardless of the conduct or outcome of the responding process.

5. Clarification of Response Document

All correspondence related to the contract shall be made in English and in writing. Any clarification sought by the respondent in respect of the project shall be addressed at least ten (10) days before the deadline for submission of responses, in writing to the Secretary of the Bank. Please note that enquires made by telephone will be rejected. The queries and replies thereto shall then be circulated to all other prospective respondents (without divulging the name of the respondent raising the queries) in the form of an addendum, which shall be acknowledged in writing by the prospective respondents.

Enquiries for clarifications should be sent by e-mail to the Secretary of the Bank. Secy@ . The entire document is available in our web site at tenders/cbs .

1.3.6. Amendment of EOI Document

At any time prior to the deadline for submission of responses, the Bank, for any reason, whether at its own initiatives or in response to a clarification requested by a prospective respondent, may modify the EOI documents by amendment.

All prospective respondents that have received the EOI documents will be notified of the amendment in writing and it will be binding on them.

To allow prospective respondents reasonable time to take any amendments into account in preparing their responses, the Bank may at its sole discretion extend the deadline for the submission of responses based on the nature of the amendments.

1.3.7. Deadline for the submission of responses

Responses should be addressed to the Secretary of the Bank and received on or before 2006, hours, in chamarajpet, Bangalore -18.

Responses sent by post should reach the Secretary of the Bank by the same deadline. Responses received after the above-specified date and time shall not be considered. Any response received by the Bank after this deadline will be rejected.

8. Responsiveness of Responses

The responsiveness of the responses to the requirements of this EOI will be determined. A responsive response is deemed to contain all documents or information specifically called for in this EOI document. A response termined not responsive will be rejected by the Bank and may not subsequently be made responsive by the respondent by correction of the non-conforming item(s).

2 THE BANK’S OPERATING ENVIRONMENT

1. Profile

Today the Karnataka State Cooperative Apex Bank has 31 branches carrying out commercial banking activities and it caters to the needs of the farmers in the State through the District Central Cooperative Banks.

Broadly the Bank offers the following services among others :

Ø Retail banking that encompasses personal and business banking and

Ø Providing refinance to District Central Cooperative Banks.

2. The Bank’s vision

The Bank’s vision is to excel among the Apex Cooperative Banks of the

Country.

3. The Bank’s mission

The Bank’s mission is to reach finance to all the farmers in the State.

4. The Bank’s processes

The Bank’s core processes are

Ø Credit and lending

Ø Transactions and payments

Ø Investments and deposits

A more detailed list of the Bank’s core processes has been included in Appendix A.

1

2 CURRENT IT ARCHITECTURE

The Bank possess a mixed, heterogeneous environment of operating systems, hardware and applications on open source and proprietary technologies, the and may abandon applications that might be rendered redundant or are in conflict with the CBS, however the Bank preferentially wishes to keep all hardware /OS/applications that is currently using.

4 VENDOR RESPONSE

4.1 Selection criteria

Responses will be evaluated in a comprehensive manner against a range of criteria, based on information gathered through the Expression of interest. Some of the evaluation criteria to be considered are :

Ø Closeness of fit of proposed solution to the Bank's processes including breadth and depth of product coverage and functionality;

Ø Design of the proposed solution including modularity and open architecture and the ease with which the proposed system can be delivered;

Ø Proven implementation ability of the supplier organisation in delivering similar solutions;

Ø The vendor's ability to provide implementation and ongoing support to the Banks operations;

Ø Quality of resources such as staff and

Ø Financial capability.

This list is not exhaustive. The decision making process is confidential and non negotiable. During the evaluation process, the Bank may request clarification of responses from suppliers.

2. Selection timetable

The next steps and target dates of the project are summarized below:

|Timetable |Date |

|EOI release date |23.06.06 |

|Last date for submission of EOI by vendors |14.07.06 (4.00 p.m.) |

|Opening of responses |15.07.06 (11.00 a.m.)|

|Issue of Request for Proposal to short listed vendors |24.07.06 |

5 INFORMATION REQUIRED

This section sets out the minimum information the vendor is requested to provide under the following headings:

Ø Vendor profile

Ø Products and services offered

Ø Personnel profile

Ø Vendor support services

Vendors should complete in the defined format. The documents have been provided in MS Excel. Vendors are encouraged to provide brochures to support the information provided.

5.1 Vendor profile

Please specify the following

|No. |Description |Response |

|1 |Name of organisation (full corporate name and any relevant business name(s) ) | |

|2 |Date of incorporation (dd/mm/yyyy) | |

|3 |Certificate of incorporation number (please provide a copy of your incorporation | |

| |certificate) | |

|4 |Postal address | |

|5 |Tel number | |

|6 |Fax number | |

|7 |E-mail address | |

|8 |Location of registered office including street/road | |

|9 |Name and address of main vendor contact person including name, current | |

| |position/title, address, telephone, fax and e-mail address | |

|10 |Name and address of bankers | |

|11 |Name and address of insurers | |

|12 |Brief description of business | |

|13 |Key offices and their locations | |

| |a. | |

| |b. | |

| |c. | |

| |d. | |

| |e. | |

|14 |Rating by renowned rating agencies (provide evidence of the rating if any) | |

|15 |Benchmarks of banking system by an independent organisation (provide evidence of | |

| |the benchmark | |

|16 |Number of professional staff | |

| |management | |

| |development/technical | |

| |sales | |

| |consulting | |

| |support | |

|17 |Number of your professional staff with more than 5 consecutive years' experience | |

| |in | |

| |management | |

| |development/technical | |

| |sales | |

| |consulting | |

| |support | |

|18 |Specify partners with whom you have strategic alliances in the following areas | |

| |and also specify dates of commencement of the relationship. (Provide evidence of | |

| |the relationship) | |

| |Software | |

| |Hardware | |

| |Communications | |

|19 |Name(s) of the relevant software | |

|20 |Number of live sites in India | |

|21 |Number of live sites in Karnataka | |

|22 |Total number of successful implementation sites in India | |

|23 |What is the current version of your core banking application | |

|24 |Date the current version of your application was released | |

|25 |How many versions of your software were released over the past 5 years | |

|26 |Total number of live sites running the current version | |

|27 |Total number of versions currently being supported | |

| |List the versions currently being supported | |

| |a) | |

| |b) | |

| |c) | |

| |d) | |

| |e) | |

|28 |Do you have full ownership of the source code? | |

|29 |What escrow arrangement do you have for the source code? | |

|30 |Specify the market for which the system was originally written | |

|31 |The year the software was first commercially available | |

|32 |Provide a brief history of the development of the system | |

|33 |Provide a brief description of the current version | |

|34 |List the various hardware platforms your application runs on | |

| |a) | |

| |b) | |

| |c) | |

| |d) | |

| |e) | |

| |f) | |

|35 |List the databases your application runs on | |

| |a) | |

| |b) | |

| |c) | |

| |d) | |

| |e) | |

| |f) | |

|36 |List the operating systems supported by your application | |

| |a) | |

| |b) | |

| |c) | |

| |d) | |

| |e) | |

| |f) | |

|37 |Describe the product architecture e.g. client/server, modular etc. | |

|38 |Describe the product development tool e.g. C# Visual Basic, Cobol etc. | |

|39 |Specify the total number of banks you have implemented your application | |

|40 |Name and location of the largest installation site in terms of number of users | |

| | | |

| |Give number of users | |

|41 |Name and location of the largest installation site in terms of number of customer| |

| |accounts (active and inactive) | |

| | | |

| |Give total number of accounts | |

|42 |Has your product been integrated with any of the following systems (Specify Yes | |

| |or No) | |

| |Electronic banking | |

| |Telephone banking | |

| | Fixed Line | |

| | Wireless (mobile) | |

| | Wireless (hand-held devices) | |

| |Internet banking | |

| |ATM | |

| |Point of Sale | |

| |Automated clearing | |

| |Data warehousing | |

| |Customer Relationship Management (CRM) | |

| |Mobile banking | |

| |Call Centre/Contact Centre | |

|43 |Which of the following is in your software offering (Yes or No) | |

| |Electronic banking | |

| |Telephone banking | |

| | Fixed Line | |

| | Wireless (mobile) | |

| | Wireless (hand-held devices) | |

| |Internet banking | |

| |ATM | |

| |Point of Sale | |

| |Automated clearing | |

| |Data warehousing | |

| |Customer Relationship Management (CRM) | |

| |Mobile banking | |

| |Call Centre/Contact Centre | |

1. Directors details

Please provide the following details for all directors of your organisation:

|Name |Nationality |Citizenship |Shares held |

|1. | | | |

|2. | | | |

|3. | | | |

|4. | | | |

1. Products and Services offered

Please specify your product or software that supports the following processes and requirements. Please indicate if this is your product or it is a third party product.

Details of the various processes and sub-processes have been included in Appendix A :

|Processes |Product or Software |

|Credit and Lending | |

|Business banking | |

|Corporate and trade finance | |

|Retail banking | |

|Mortgage lending | |

|Investments and deposits | |

|Commercial instruments | |

|Government securities | |

|Inter-bank operations | |

|Transactions and payments | |

|Customer accounts management | |

|Cash operations | |

|Card products | |

|Others | |

|Financial reporting | |

|Performance management | |

|Customer Information | |

|System security and controls | |

|Signature verification | |

|Document management | |

|Shares management | |

You may attach brochures of your products and services.

1. Delivery channels supported

Please indicate if this is your product or it is a third party product.

|Delivery channel |Product supporting |

|Internet | |

|Short message services (sms) | |

|Telephone | |

|Fixed line | |

|Wireless (mobile) | |

|Wireless (hand-held devices) | |

|ATMs | |

|Point of Sale (POS) | |

2. Personnel profile

1. Human resources

Ø Provide the organization structure of your firm and summarize the number of employees in each department or function

Ø Provide the resource structure for implementation and support of solution required

1. Vendor support services

Please provide the following

|Training | | | |

|Details of training offered | | | |

|Location of training | | | |

|Implementation support | | | |

|Specify nature of support offered in Karnataka |Location |Office name, location, |Nature of support |

| | |telephone, key contact name | |

|Specify nature of support available in Karnataka |Location |Office name, location, |Nature of support |

| | |telephone, key contact name | |

| | | | |

| | | | |

| | | | |

|Specify nature of support available in Bangalore |Location |Office name, location, |Nature of support |

| | |telephone, key contact name | |

| | | | |

| | | | |

| | | | |

| | | | |

|Help line facility | | | |

|Brief description of facility | | | |

|Problem handling channels | | | |

|Average response time for support activities | | | |

|Specify ability to provide user support in | | | |

|multiple languages | | | |

2. User and reference sites

Please provide the following information related to five (5) banking institutions where your system has been successfully implemented

|1. |Name of banking institution | |

|2. |Name and address of contact person including name, current position/title, | |

| |address, telephone, fax and e-mail address | |

|3. |Country of incorporation | |

|4. |Location of the headquarters | |

|5. |Number of branches | |

| |Geographical distribution of branches | |

|6. |Estimated number of staff | |

|7. |Annual turnover during period of implementation (Indian Rupees) | |

|8. |Brief description of project undertaken | |

|9. |Project duration | |

|10. |Date of implementation including start and end dates | |

|11. |Indicate the processes covered by the products/modules implemented | |

| |Credit and Lending | |

| |Business banking | |

| |Corporate and trade finance | |

| |Retail banking | |

| |Mortgage lending | |

| |International Operations | |

| |Treasury | |

| |Corporate and trade finance | |

| |Investments and deposits | |

| |Commercial instruments | |

| |Government securities | |

| |Inter-bank operations | |

| |Transactions and payments | |

| |Customer accounts management | |

| |Cash operations | |

| |Card products | |

| |Others | |

| |Financial reporting | |

| |Performance management | |

| |Customer information | |

| |System security and controls | |

| |Signature verification | |

| |Document management | |

| |Shares management | |

|12. |Number of professional staff provided by your firm for the implementation | |

|13. |Number of customer accounts (active and inactive) | |

|14. |Did your product interface with any of the following systems during the | |

| |implementation (please indicate if this is your product or it is a third party | |

| |product) | |

| |Electronic banking | |

| |Telephone banking | |

| | Fixed Line | |

| | Wireless (mobile) | |

| | Wireless (hand-held devices) | |

| |Internet banking | |

| |ATM | |

| |Point of Sale | |

| |Automated clearing | |

| |Data warehousing | |

| |Customer Relationship Management (CRM) | |

| |Mobile banking | |

| |Call Centre/Contact Centre | |

KSC Apex Bank undertakes not to contact any reference site without obtaining your prior consent.

APPENDIX - A

The Bank’s core processes

|Credit and Lending |Investments and Deposits |Transactions and Payments |

|Business banking |Commercial instruments |Accounts |

|Loans |Purchase of commercial paper for bank | |

|Overdrafts |portfolio |Savings |

|Asset based finance |Purchase of commercial paper for |Personal |

|Bank assurance |customers |Account management |

|Corporate and Institutional Finance |Bank acceptances |Certificate of depositor |

|Loans/Syndicated Loans |Time and call deposits | |

|Overdrafts |Short term deposits |Cash operations |

|Structured finance |S&L fixed deposits | |

|Line of credits | |Money transfers |

|Structured Finance |Government securities |Cash and cheques receipts |

|Guarantees | |Draft payments |

|Term Loan |Treasury bills and bonds |Direct debit payments |

|Working Capital |Inter-bank operations | |

|Project Finance | |Card products |

|Refinance |- Money market | |

|Retail banking | |Prepaid |

|Personal loans | |Post paid |

|Debt management | | |

|Mortgage Lending | | |

|Mortgage financing | | |

|House development bonds | | |

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