IBS Journal April 2015


Backchat The latest industry gossip


Nordea’s strive to replace its legacy core banking software has entered the next stage with two vendors believed to be on the final shortlist. The bank is looking to automate its largely manual processing (which at present requires input from 5000 staff) and replace ageing systems such as Misys’ Midas and Tieto’s Core Banking Suite. The focus is currently on domestic retail operations. Incidentally, it is understood that neither Misys nor Tieto made it to the short-


list. The four vendors that did, however, are believed to be Oracle FSS, SAP, Infosys and Temenos. Of these, Infosys with its Finacle core offering and Temenos with T24 are now in the final, with Oracle FSS and SAP coming third and fourth, respectively. Finacle has no users in Sweden, and its penetration of the Western European mar-


ket is low (around 20 users here are largely the subsidiaries of Asian and Middle Eastern banks that use Finacle elsewhere, plus a multi-site deal with ING). Temenos has a larger installed customer base in the region, including one site in Sweden, as part of a pan- European project with Danske Bank. Nordea went public on its plans to ‘rip and replace’ its old core banking and pay-


ments systems in October last year, setting aside a budget of €1 billion and warning of a €350 million impairment charge from the decommissioning of the legacy platforms.


Australia-based Bank of Queensland (BoQ) has halted a pilot project to roll out a new CRM system from specialist vendor Salesforce.com, resulting in an impairment of AU$10 million ($7.8 million). The project dates back to 2012, when BoQ committed to replacing its legacy CRM platform with the cloud-based offering from Salesforce. 50 pilot branch- es were earmarked for a first phase. The project stemmed from a AU$17.1 million ($13.3 million) loss posted by the bank


in 2012, after which the bank’s CEO, Stuart Grimshaw, laid out plans to modernise and rationalise its IT infrastructure whilst also boosting its sales capacity as part of a turna- round plan. Grimshaw, however, unexpectedly left the bank in the middle of last year. The bank’s new CEO, John Sutton, said a recent review carried out by the bank


found the system was unable to meet operational and regulatory requirements. ‘We remain committed to providing cost-effective tools to our business to support growth and productivity, and will therefore investigate the use of alternative CRM solutions,’ he said.


As late as 2013, the bank was preaching the benefits of the software, noting that


accounts could be opened in five minutes compared with the previous 30 minutes, and using 22 keystrokes instead of 144. There were also ‘strong cross-sell opportunities’ with- in its existing client base, the bank noted. Over the years, BoQ has been a proponent of cloud-based technologies, and former


CEO Grimshaw was keen to point out that it would be making incremental changes to this end, as opposed to the full scale core system transformations of some of its com- petitors. The bank runs Fiserv’s Signature core platform, which it took in 2002 as part of a ten-year AU$480 million ($375 million) services outsourcing arrangement with EDS.


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