Research Reveals Many UK Financial Services Firms are Struggling to Deliver Single Customer View Regulation

Respondents Cite Poor-Quality Legacy Data, Lack of Corporate Engagement and Confusion Over Requirements as the Top Implementation Challenges

LONDON, July 23, 2010 - DataFlux, a leading provider of data management solutions, today
announced the findings of a research survey into the UK financial services
industry's readiness to meet the legal requirements of the Financial Services
Compensation Scheme Reform (FSCS) and the creation of a single customer view
(SCV). The legislation requires all UK insurers, building societies and
retail and investment banks to create and maintain an accurate view of each
customer. The first reporting deadline is 31 July 2010, and full compliance
must be achieved by 1 January 2011. The survey, commissioned by DataFlux and
conducted by research house JWG, reflects the responses of individuals in the
financial services industry that are responsible for the data in their
respective companies.

The industry is just getting to grips with FSCS regulation and
implementation.

There are over 800 deposit holding institutions in the UK to which the FSCS
reform applies. The survey found that 50% of respondent firms only began the
significant undertaking to develop an SCV during 2010 - the year in which
projects must be delivered. Just 59% of respondents had heard of the
requirement for single customer view, with a significant percentage (41%)
unaware of their regulatory obligations. In addition, 28% of respondents
could not identify who owned the SCV within their organisation.

Action from the industry is required to avoid financial
penalties and greater scrutiny.

When respondents were asked about the consequences they expected to face if
their institution failed to meet the FSCS SCV deadline of 1 January 2011, the
majority (65%) believed they would incur a financial penalty which could be
millions of pounds. In addition, 74% of respondents felt that a failure to
meet the deadline would lead to greater scrutiny from the regulator and one-
third believed their firm would be at a competitive disadvantage.

Firms recognise data management issues as the greatest compliance
challenge.

When investigating the barriers to compliance, four key areas were
identified: a lack of business commitment, a lack of resources,
poor-quality data and a lack of guidance. In addition, data-related issues
were viewed as the most challenging to overcome, with poor-quality legacy
data and data quality management earning a 'difficult' rating. Respondents
also cited a lack of guidance from the regulator as a barrier to compliance.

A single customer view provides benefits across the enterprise.

Respondents said an SCV benefited a variety of business functions, such
as the back office (80%), the risk management department (64%) and the
revenue generating departments (40%). However, only 14% saw an SCV project as
a strategic opportunity to deliver benefits above and beyond compliance.
Since an SCV program can also dramatically improve an organisation's
understanding of the customer for marketing and support purposes, the
remaining 86% of respondents could miss a vital opportunity to improve
customer-facing processes and enhance lifetime customer value.

Colin Rickard, managing director EMEA, DataFlux, commented: "This report
highlights a shortfall in spending required to create SCVs in order to meet
the FSCS requirement for January 2011. This will have to be corrected in the
second half of 2010 or firms risk facing significant fines and further
reputational damage during 2011. It is clear that data quality and data
integration are key compliance challenges. We are working with leading
financial services firms to create and validate SCVs across the industry."

PJ Di Giammarino, founder & CEO, JWG, added: "The customer data issue
isn't going away anytime soon. Accurate customer data is critical to the
regulatory tsunami as it is fundamental to controlling risk, protecting
customers and spotting market abuse." He continued: "Five high profile firms
have recently been fined a total of GBP7.3 million by the FSA in relation to
data errors. The survey findings suggest there will be significant penalties
for those companies that neglect the development of a single customer view."

DataFlux helps organisations as they strive to stay compliant to this
FSCS legislation as well as gain a more complete picture of their customers:
their behaviors, their needs and the potential risks. DataFlux provides
customer information management solutions based on industry-leading data
quality technology. To learn more, visit www.dataflux.com/scv.

About the research

JWG and its partner, MarketingCells, conducted 1:1 interviews with 61
financial services professionals from 44 UK based financial institutions.
Respondents were drawn from the fields of compliance, data management and IT.
In addition the report is supplemented with insights from four meetings of
JWG's Customer Data Management Group which comprises senior risk, operations
and compliance officers at major financial services firms. To download the
full research report please visit: www.dataflux.com About the
regulation Following the EU's Deposit Guarantee Scheme Directive (DGSD) of 11
March 2009, all 27 member States are to implement deposit guarantee schemes
that will enhance trust in the banking system. In response, the Financial
Services Compensation Scheme (FSCS) issued policy statement PS09/18 which
stipulated that the 800+ UK deposit holding institutions must implement a
single customer view (SCV) to provide a consistent view of deposit holder
accounts by 1 January 2011. In addition, deposit holding institutions must
submit their SCV implementation plans to the FSCS by 31 July 2011. The aim of
this regulation is to enable payment of compensation to a deposit holder
within 7 days in the event of an institution collapsing and to inspire
confidence in the wake of failed institutions such as Northern Rock. The cost
of implementation of a SCV across the industry was estimated at GBP432 -
GBP530 million in a 2008 report by Ernst & Young.

About DataFlux

DataFlux enables business agility and IT efficiency by providing
innovative data management technology and services that transform data into a
strategic asset. A wholly owned subsidiary of SAS (www.sas.com),
DataFlux helps organisations manage critical aspects of data through unified
technologies and expertise that provide the benefits of data quality, data
integration and master data management (MDM). To learn more visit
www.dataflux.com.

    Media contacts:
    Nick Ward / Helen Fitzhugh
    Epoch on behalf of DataFlux
    +44(0)20-7401-8001
    +44(0)7528-377-283
    nward@epochpr.com / hfitzhugh@epochpr.com

    Scott Batchelor
    DataFlux
    +1(919)447-3000
    publicrelations@dataflux.com

    PJ Di Giammarino
    JWG
    +44(0)20-7870-8004
    PJ@jwg-it.eu

Media contacts: Nick Ward / Helen Fitzhugh, Epoch on behalf of DataFlux, +44(0)20-7401-8001, +44(0)7528-377-283, nward at epochpr.com / hfitzhugh at epochpr.com; Scott Batchelor, DataFlux, +1(919)447-3000, publicrelations at dataflux.com; PJ Di Giammarino, JWG, +44(0)20-7870-8004, PJ at jwg-it.eu