NRI modernizes critical back-office solutions for brokerage firms with OCI

Authored by Nick DiBlasi, cloud migration director at Oracle, Maria Tomescu, business development senior manager at Oracle, and Kellsey Ruppel, principal product marketing director at Oracle.

The authors want to thank the NRI team, especially to Hiro Hamada, Managing Director and Head of the Financial Enterprise AI Center at Nomura Research Institute (NRI), Kayoko Okayama, Manager, Solution Sales, NRI, and Koh Kamemoto, Consultant, IT Migration, NRI, for their contributions.

Figure 1: Nomura Research Institute (NRI) is a leading think-tank and systems integrator in Japan.

To support its growth strategy while maintaining complete control over its data and financial governance, the Nomura Research Institute (NRI) is modernizing its mission-critical back-office solutions for brokerage firms with Oracle Cloud Infrastructure (OCI) Dedicated Region. NRI’s THE STAR helps enable brokerage firms and banks in Japan to conduct core operations, such as setting up accounts, placing trades, settling trades, conducting compliance checks, reporting on sales, and financial accounting.

About NRI

Nomura Research Institute is Japan’s leading consulting and IT solutions provider. Established in 1965 as a spin-off from Nomura, today NRI has more than 16,000 employees in more than 50 offices globally, including New York, London, Tokyo, Hong Kong, and Singapore.

Figure 2: NRI information, including date of establishment, market cap, number of employees, representative executive, offices, consolidation dates, and consolidated operating profit.

THE STAR migration

Launched in 1974 as a COBOL application running on a mainframe, THE STAR application is a standard software-as-a-service (SaaS) solution for retail broker dealers in Japan. THE STAR manages over 20 million accounts, providing comprehensive back-office support to more than 70 brokerage firms and banks that process hundreds of millions of trades per day, approximately half of the trades in the Tokyo Stock Exchange.

By 2000, NRI recognized that the mainframe environment lacked the maintainability and scalability they needed to remain a market leader. To improve competitiveness in the market, NRI opted to move THE STAR from the mainframe to an open systems architecture. The new platform that serviced THE STAR from 2003-2022 was based on Micro Focus COBOL, HP-UX and Linux servers, and the Oracle database.

In 2020, NRI decided to embrace cloud technology to further improve maintainability and scalability, while also reducing their operating expenses.

Migrating THE STAR to OCI came with the following goals:

Scale and ensure maximum availability
Reduce operating cost
Utilize cloud native services, such as APEX and Autonomous Database
Maintain complete control over financial governance and regulatory compliance

The migration of THE STAR follows the successful implementations of OCI Dedicated Region in NRI’s Tokyo and Osaka data centers. With a staff of over 700 certified OCI engineers, including ACE certified professionals, NRI now runs the following of their most critical applications in OCI Dedicated Regions:

“With a proven track record of moving our BESTWAY and T-STAR applications to OCI Dedicated Region, we have been able to build a secure, 24/7 platform that has enabled us to also move THE STAR applications to the cloud, while maintaining a high level of financial governance and regulatory compliance,” said Noriyuki Takeda, senior managing director of brokerage solutions at NRI.

Figure 3: A bar-line graph of how many accounts that STAR is managing, including a projection for the future.

As part of the migration of THE STAR, NRI uses Oracle Kubernetes Engine (OKE) to upgrade its applications and quickly respond to customer needs and industry regulations. Recent enhancements to OKE, such as the introduction of serverless Kubernetes with virtual nodes, enable NRI to improve developer productivity and accelerate innovation.

“OCI has helped us build a distributed cloud environment within our Tokyo and Osaka data centers, allowing us to leverage the high-performance and flexible resources of OCI and maintain a high level of financial governance and availability that we require,” said Tomoshiro Takemoto, senior executive managing director at NRI.

Figure 4: Migration history of THE STAR, including services, project durations, service periods, system structures, major issues to solve, and migration methods.

Results

As a result of the move to OCI, NRI has been able to improve performance and efficiently manage computing resources. According to Tomoshiro Takemoto’s testimonial, “By utilizing Exadata Database Service’s CPU scaling, we have managed resources efficiently.[…] Also on OCI with the latest hardware, performance improved in about 60% of our service processes.”

The benefits of Exadata

Exadata is a combined hardware and software platform that includes scale-out database servers, scale-out intelligent storage servers, ultra-fast networking, memory acceleration, NVMe flash, and specialized Exadata Software. Exadata is designed to optimally run any Oracle Database workload or combination of workloads. The platform is also frequently used to consolidate many databases that previously ran on dedicated database servers. Exadata's scale-out architecture is naturally suited to running in OCI, where computing requirements can dynamically grow and shrink.

Figure 5: Exadata smart system software, including online transaction processing (OLTP), analytics, and consolidation.

Best of all, Exadata runs where you need it, on-premises, as a hybrid cloud, or in the public cloud.

Figure 6: Examples of deployment models for Exadata, including on-premises customer data center, cloud@customer, and public cloud in OCI.

Next steps

In the near future, NRI plans to use Oracle Cloud Infrastructure Autonomous Database and Oracle APEX to accelerate the development and management of applications and databases. For more information on NRI and Oracle Cloud Infrastructure, see the following resources: