IBS Journal Supplement 2015


And Misys had a clear roadmap for


LoanIQ which FCBT felt was missing for ACBS. Around 84 gaps were identified for LoanIQ. Misys took these away and then returned to demonstrate, one by one, how it intended to address them. ‘We were at a crossroads, did we go forwards with one or two systems,’ says Elliott. There seemed to be a lot of movement on the part of Misys to bring LoanIQ into the mid-market space. The plug was pulled on the Silverlake pro- ject and the attention turned to LoanIQ.


The project


While the existence of many large users of LoanIQ and a number of ongoing projects within these was deemed a positive during the selection, there was clearly a poten- tial downside. Sure enough, FCBT strug- gled to attract good resources from Misys once the contract was signed. ‘That was the challenge of the day,’ says Elliott. ‘Trying to compete with the behemoths for resources was difficult.’


Elliott emphasises the human aspect of


such projects. ‘One of the main keys to suc- cess is using the right people on your pro- ject,’ plus the right management to keep everyone focused. He feels Misys in 2015 is different from Misys 2008-10, with a signif- icant improvement in professional services since the takeover of the company by ven- ture capital firm, Vista Equity Partners, in 2012. For the LoanIQ project, he suggests a score of ‘two out of ten’. He adds: ‘The experts came in, sold to us, and then left’. The lack of experience of those assigned to the project was ‘quite frustrating’. The bank ran three times its volumes


and simulated 300 concurrent users on LoanIQ as part of its validation of the plat- form, with the end-of-day batch processing taking around 90 minutes. The flexibility is an advantage but also a risk. ‘If you are not careful, there are lots of different configura- tions, knobs and dials, and you can get into a fix,’ says Elliott. However, ‘once the dust had settled’,


LoanIQ has proved to be stable, from an accrual and non-accrual basis, says Elliott. Moreover, the lessons can be carried for- wards to the implementation of the new front-end.


Change management will be a major


challenge. Looking forward to this, Elliott says: ‘We will ensure that we prepare our people out in the field, that preparation


12


starts now.’ There will be an advisory com- mittee that will meet on a periodic basis and will scrutinise the system and process changes.


The future


Having gone live with LoanIQ for account- ing, attention turned to the front-end for the parent banks. As mentioned, there was a separate selection. This started with 42 systems on the long-list and ended with Sungard’s Ambit Commercial Lender. This had at its heart the CustomLender sys- tem from US-based CCS, with some other Sungard software around it. An influence was the choice a couple of years earlier of Ambit Commercial Lender by FCBT’s California-based equivalent, AgFirst Farm Credit Bank, albeit that this bank does not have LoanIQ. There is a close relation- ship between FCBT and AgFirst, including working together within syndications. The flexibility and configurability of Custom- Lender was also an influence. The fact that, by a happy coincidence


from FCBT’s perspective, Misys acquired CCS and the CustomLender product in mid-2014 as FCBT was going through its final evaluations was good news and is expected to aid the integration with Loan- IQ. It should mean that the bank becomes the first to go live with the combined products. The project to implement Custom-


Lender is the next challenge for FCBT, along with a major upgrade to LoanIQ. As well as CustomLender (now Fusionbank- ing Credit Management Enterprise), the bank will implement one or two of the other Sungard Ambit Commercial Lend- er components, including one for credit risk management (due to go live later in 2015) and another for loan calculations.


© IBS Intelligence 2015 www.ibsintelligence.com


The planning for the CustomLender project has started recently, with timescales still to be decided. The project will be fast-paced, says Elliott, but not rushed. The priority is to ensure that the needs of the 14 banks are met and that they will be able to make full use of what should be an asset for the next ten years or more. He expects both improved competitive edge and reduced costs for the banks, allowing their staff to focus more on their core business of lending. It will be a big upheaval because, unlike LoanIQ, which is somewhat hidden from the banks, the front-end will impact all aspects of their business. In terms of the LoanIQ upgrade, FCBT


is currently on the version which, reflecting its age, is written in the Smalltalk program- ming language. The bank will move to the Java version. A version of the Java-based LoanIQ has been installed on a test basis and there is some work that can be done for integration but the bank is waiting for version 7.4, scheduled for March 2016, as there is functionality that is intended for that release that is needed by FCBT, par- ticularly related to payment disbursements and scheduling. Many of the original gaps in LoanIQ


have been closed, says Elliott, and he believes that if the momentum is main- tained then, particularly with the addition of the front-end, Misys has a good oppor- tunity in the mid-market. Clearly, FCBT had a couple of false


starts before settling on its current strategy and there are two major projects to come, but it has a clear vision and has a solid accounting back-end in the current version of LoanIQ. Lessons from previous projects are being carried forward and the bank has one main supplier, through circumstance rather than design, providing both the front- and back-ends.


‘That was the challenge of the day. Trying to compete with


the behemoths for resources was difficult.’ Michael Elliott, Farm Credit Bank of Texas


case study: farm credit bank of texas


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