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However, fairly swiftly, the bank concluded that it needed a specialist lending system after all.

• Turning to Misys

In LoanIQ, said Elliott, Misys had a complex engine that needed to be simplified for FCBT; Jack Henry had a simple engine that needed to be complicated. The bank decided in the end that the former route was easier than the latter one. ‘It was easier for Misys to step down into the mid- market than for Jack Henry to step up.’

Loan accounting was the main focus of the selection and LoanIQ came out strongly from this perspective, including in the area of managing the bank’s capital market portfolio.

The structure of the system, said Elliott, which was built from the start for syndications, was felt to be a good fit with the bank’s organisational set-up as it is ‘relatively loosely coupled’, with good APIs and a three-tier client-server architecture, plus a ‘multi-tenant structure’.

‘Misys was also more flexible when it came to answering us on how the system could be adjusted for us.’ While the bank wanted to fit its processes to the system as much as possible, its unusual structure and business model meant there was always going to be customisation.

• Reassurances

The bank was also reassured by the number of large US banks with the system, such as JP Morgan Chase and Wells Fargo, plus a couple that had decided to move from ACBS (one of these was Bank of America). Citibank and Goldman Sachs were more or less the only two large US banks that didn’t have LoanIQ, said Elliott.

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,’ said 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 project and the attention turned to LoanIQ.


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 potential downside.

• Resources issues

Sure enough, FCBT struggled to attract good resources from Misys once the contract was signed. ‘That was the challenge of the day,’ said Elliott. ‘Trying to compete with the behemoths for resources was difficult.’

Elliott emphasised the human aspect of such projects. ‘One of the main keys to success is using the right people on your project,’ plus the right management to keep everyone focused.

He felt that the Misys in 2015 was different from Misys 2008- 10, with a significant improvement in professional services since the takeover of the company by venture capital firm, Vista Equity Partners, in 2012.

For the LoanIQ project, he suggested a score of ‘two out of ten’. He added: ‘The experts came in, sold to us, and then left’. The lack of experience of those assigned to the project was ‘quite frustrating’.

• Stress testing

The bank ran three times its volumes and simulated 300 concurrent users on LoanIQ as part of its validation of the platform, 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 configurations, knobs and dials, and you can get into a fix,’ said Elliott.

However, ‘once the dust had settled’, LoanIQ has proved to be stable, from an accrual and non-accrual basis, said Elliott. Moreover, the lessons can be carried forwards to the implementation of the new front-end.

• Go Live

FCBT went live with a new solution within a year. It was using the 6.5 version of the system, which is written in Smalltalk.

Core Banking Systems Case Studies: North America

The contract with Misys was signed in 2008. Implementation

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