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CONFERENCE REVIEW
Journalists and clients descended on Switzerland during September for the Avaloq Community Conference
Gunning for the digital crown
The Swiss vendor, which is known for its private banking operations, was looking to prove its credentials as a more digital-friendly company. Francisco Fernandez, CEO, remarked that there had been an Avaloq go-live almost every weekend in 2016. The company has posted a 28% compounds growth, a sizeable figure considering the industry’s average of 12%. “We have never killed a project and we are unique in this”. Fernandez said that the company has almost quadrupled its growth and has taken on more than 2,200 new employees since 2012. He put it down to “a sharing economy”. “With the same budget you can do pay-per-use and get better efficiency,” he said of core banking. “We have launched an ecosystem that [is] the iTunes of FinServ”.
Fernandez was referring to the Avaloq Software Exchange, a modular choose-your-own service that allows customers to pick what fits their business best. “The problem is always how and who you build your product with,” stated Thomas Beck, Group CTO. In the last seven years the number of high net worth individuals has increased, but the profits made by banks has fallen. Avaloq can deliver “a foundation for a digital ecosystem” including omnichannel client experiences, advisory and management.
There’s a heavy whiff of BPO in the air, and Avaloq are seemingly keen to push the benefits of using an outsourced system. Markus Gröbinger, Group Head of Strategy at the firm, displayed a graphic that the cost-to-income ratio of banks in Switerland without Avaloq systems is up by 5%, while banks on the company’s books improved by 1% and BPO clients by 6%. Indeed, it seems that the figures match the firm’s growing client base, as it is confirmed that more than 10 banks will be going live by the end of the year.
Tecla Solari, General Manager for Europe at Avaloq,
confirmed that the vendor, like many that are well- established in Europe, is looking at entering the US market. Despite a few companies showing an interest in its systems, the firm is still in the early research stages when it comes to North America. With that market, Solari told IBS Journal, you have to be sure of yourself before you make a move or risk facing a tough battle against the competition and regulators. Avaloq is also doubling down its presence in Asian markets, specifically Singapore, China and Australia. A major deal it signed in 2012 with a firm in the Westpac Group is in its final implementation stages and will be fully live by November.
When quizzed on Brexit, Solari admitted that like many in Europe she was surprised by the result of the referendum and slightly worried about how firms in the UK might react. However, there haven’t been any short- term problems and business partners in the country have been as keen as ever to get projects done. Avaloq is also still hiring for its UK-based operations.
With Sibos approaching, Solari was asked whether the vendor would be making an appearance, especially since the show is in Switzerland for 2016. She suggested that Avaloq doesn’t see the benefit at this time of spending lavishly on exhibition stands with bright lights and promises. “We invest in innovation, not marketing.”
It seems that Avaloq, which counts Temenos as one of its main rivals, is gunning for the digital crown in 2017. It is keeping up its record of best-ever turnovers and client sign-ups, and with eyes set on the grand prize of North America, it will be interesting to see how it measures up.
www.ibsintelligence.com © IBS Intelligence 2016
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