Mixed results
In terms of number of sales in 2009, there was a falling away for Flexcube, to 33 from 39 in 2008. This figure excluded local Indian deals but now incorporated sales of Daybreak which had hitherto been given a separate total. Most of the wins were spread across Africa, Central and South East Asia, and Central and South America, with these three regions accounting for over 60 per cent of wins. Flexcube was taken less often in the Middle East, Europe and North America. One win around this time came from newly-launched Afghan bank, Afghan United Bank (AUB). AUB took the 10.5 version of Flexcube installed on Sun hardware with Linux/Unix. It covered all main areas of operation at the bank, including retail, SME and corporate activity, trade finance and internet banking. Islamic banking, offered via AUB’s Islamic banking window, was also supported by Flexcube. AUB was the first bank in Afghanistan to receive permission
from the central bank to offer Shari’ah-compliant services. However, there was, at this stage, no set regulatory framework for the industry in the country, so AUB’s Islamic offering was initially limited to some commercial and investment services, available in two branches. There were, however, plans to convert to a fully-fledged Islamic bank once the relevant regulation was passed. AUB planned to grow its 15 branches in the country to 50 by 2015 with the support of Flexcube. 2009 also saw the Islamic version of Flexcube lose out to
Path at Amwal Credit Union, the first Shari’ah-compliant co-operative financial institution in Hong Kong. Oracle lost out partly due to ‘the fact that the system is perceived to be converted from a conventional banking software package rather than developed as an Islamic banking system from the ground up’, explained Lord Edwin Hitti, president of Amwal. This was also the reason given for another loss to Path around the same time at Abu Dhabi-based start-up Noor Islamic Finance Co.
Another common competitor in the Islamic banking sphere is International Turnkey Systems (ITS) and its Ethix solution. In 2012, it emerged that National Bank of Egypt (NBE) had selected this for a new operation in Sudan. This was despite the fact that Oracle FSS supplied Flexcube as the bank’s
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conventional system in Egypt. Unlike in Egypt, Sudan’s regulator demands that all banks must be Islamic, said Mohamad Meneassy, ITS’s manager for Africa. Because of this, ‘NBE was looking for an expert in Islamic banking’. Moreover, in Egypt where NBE took Flexcube from Oracle FSS in 2009, a project was lined up for ITS’s solutions to be installed for its Islamic branches and interfaced to Flexcube. There was also a similar situation at Gumhouria Bank, the largest bank in Libya, and Flexcube was also overlooked at Faisal Islamic Bank in Egypt as it was thought that it would be too slow to implement versus Ethix. Oracle FSS’s total sales for Flexcube in 2010 was only one below the previous year: two of these were Islamic banking wins, at UAE-based Mashreq Bank and an off-the-record win in Brunei. The former offers Shari’ah-compliant banking services via its Mashreq Al Islami Islamic banking arm which was relaunched in March 2010. This win was gained versus Infosys at the shortlist stage. The project has been carried out on a phased basis, starting with a cut-over in Qatar. Mashreq Bank had an estimated 30,000 man-days of customisation on Flexcube, with much of the work stemming from what was perceived to be a relative lack of depth of Islamic banking support. The potentially good news for future takers was that Mashreq Bank has been, according to CIO, Johan de Meyer, ‘very insistent’ that the customisations are rolled back into the standard version of Flexcube to avoid potential future problems when it comes to upgrading. Overall, the bank was happy with progress and felt it had received good support from Oracle. In 2011, Oracle FSS finally topped the IBS Sales League Table once more, beating arch rival Temenos by just one signing. However, the latter had suffered a steep decline in new name sales during 2011 and Oracle FSS’s final result of 28 wins was one of the lower winning tallies of recent years. In terms of Islamic banking gains, one came from Warba Bank, a new Islamic bank in Kuwait which was due to open for business by the end of the year. The Kuwaiti government owned a quarter of the bank and the balance was distributed evenly among the population. Flexcube was chosen ahead of Path at the shortlist stage, with Temenos and ITS also considered. System functionality and architecture were among the key criteria for selection. Flexcube received the highest overall score,
Islamic Report
www.ibsintelligence.com
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