Adaptiv FIS(Sungard)


Overview


There is a suite for ALM and risk management within the banking division of Sungard, dubbed Ambit Risk & Performance, and another for trading book risk, dubbed Adaptiv. This entry focuses on the latter. Both, in typical Sungard fashion, have stemmed from multiple acquisitions and a degree of integration. Sungard also has a number of treasury and capital market systems, which include risk functionality. Among them are Front Arena, Sierra and Quantum, positioned in that order based on the size of the bank. Sungard as a whole has 20,000+ staff and has made 160+ acquisitions down the years, although with a slowdown of late. Sungard has had a tough time since delisting, prior to which it had managed extremely consistent financial figures (boasting that it had only ever missed its targets in two quarters). Reflecting the issues, 2010 revenues were $4,992 million with a net loss of $570 million; 2009 revenues for 2009 were $5,332 million and a net loss of $1,117 million. There has been a pick up since then. In 2013, revenue was $4.1 billion, down two per cent year over year, and operating income was $461 million, a one per cent increase. In January 2014, Sungard announced its intention to split-off its Availability Services business from the Software and Processing businesses. This was completed at the end of March 2014. In November 2015, Sungard was acquired by FIS. The acquisition propelled FIS to a $9.3 billion company, with a broad range of


retail, enterprise and wholesale banking and payments capabilities. The combined entity had over 55,000 employees at the time. FIS also agreed to repay SunGard’s existing debt. In December 2016, Vista Equity Partners arrived at an agreement to acquire the SunGard Public Sector and Education businesses from FIS for $850 million. The agreement was part of FIS’ strategy to help focus on its key area of service and expertise, which is financial technology. The acquisition was completed in February 2017.


Summary history 1995


Sungard launches Panorama derivatives trading and risk system.


1995 December – Sungard buys California-based Renaissance Software and its Opus derivatives system. 1997 2000 2002 2005 2010 2014 2015 2016


Sungard buys trading and risk management systems provider, Infinity Financial, for $313 million. Sungard acquires the RXM solution from GE Information Services. Sungard buys real-time market risk system specialist, Kronos Software Ltd. Sungard is acquired by a group of seven private equity companies. Sungard buys Australia-based credit assessment specialist, Inmatrix. Sungard splits its Availability Services business from the rest of its operations. FIS acquires Sungard for ~$5.1 billion


FIS sells Sungard’s Public Sector and Education businesses to Vista Equity Partners and retains the fintech business Adaptiv


The main foundation stones of today’s Adaptiv are Panorama and a global limit management system from GE Information Services called RXM (Risk Exposure Management). Also in the mix were systems called Infinity, Opus and Kronos. The aforementioned Ambit Risk & Performance is a similar construct of four or five parts. Of late there was been some cross-fertilisation,


with Adaptiv contributing the market


risk component of Ambit, replacing a portion of the existing offering, derived from the ALM product at the heart of Ambit Risk, Almafin. All of Sungard’s acquired businesses tended to continue as separate entities during the 1990s and into the new


century. This was the Sungard model. They retained their own autonomy, P&L, R&D – which they largely had to finance themselves – and sales and marketing. This started to change from around 2004. There was something of a restructuring and a rationalisation of products, as well as the concept of joint development and shared components. The switch gained more momentum after Sungard was delisted with the arrival of venture capital owners. It was largely from here on that the different risk solutions started to truly come together as an integrated platform. The reuse of the Adaptiv component for market risk within the Ambit suite was a reflection of this. Panorama was launched as a front and middle office derivatives trading and risk offering in 1995 and stemmed from the business unit centred on the Devon trading system. It was built using Visual C++ to run on Windows NT with SQL


Risk Management Systems & Suppliers Report | www.ibsintelligence.com 137


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