SLT 2015 | Performance Overview At long last there were signs of a modest up turn when we
collated all of the 2014 data. As with the economic upturn as a whole, not everyone was benefiting, with those in the ascendancy being relatively few. Never the less, there will have been a collective sigh of relief that2013 seemed to have been the low point.
In the three main categories (universal banking, treasury
and capital markets, and private banking), there are now between one and three clear market leaders, picking up the bulk of the deals. It will not be a great surprise to industry watchers that nearly all of these are focused companies with one flagship core product. The many other systems that have been brought under single roofs by market consolidation are mostly falling away.
Another trend appeared to be something of a renaissance
for some of the smaller, local and regional suppliers, again typically without the complication of multiple systems. They appeared to be gaining in 2014 from the more piecemeal approach to core system renewal by some of the large, international banks. Many such banks have given up on their grand plans of past years whereby they were going to standardise all international operations on a single core. In part, through painful experience, they are increasingly opting instead for a more pragmatic approach of picking the best system for the local market and, sometimes, giving autonomy back to the country operation for selecting this. The one area where this isn’t the case is private banking, where the opposite is true, with moves by a number of tier one and two banks to rationalise systems across the globe.
While the quantity of deals went up slightly, the size of deals
did not. There were very few high-enddomesticor multi-site decisions in 2014, once more. At least it could be said that a number of the top end banks appeared to have restarted analysis of core systems. As a few, such as CBA in Australia, have emerged from their multi-year projects, with others on- goingafter a number of years, it seemed a next wave might be on the way. We would expect SAP to feature in some of the analyses, so too perhaps Oracle with OBP.
In the meantime, the vast bulk of the universal core banking
systems market remained the third and fourth tier banks in emerging markets. The two runaway leaders in 2014, as usual, were Temenos with T24 and Oracle FSS with Flex cube. They both brought in good hauls of lower end deals.
Temenos showed its resilience again in terms of the number
of deals for T24. Its 37 in 2014 was a slight increase on the 35 of 2013. Its only deals in Western Europe were three low- endonesin the UK, including6 Towns Credit Union and Reall
38
(previously Homeless International), a micro finance institution focused on the home less. There was also a small private banking deal in Luxembourg. There was nothing in Central or Eastern Europe. Starting to build on its heightened presence in the US, it gained two small clients, plus Bermuda Commercial Bank. In a traditional market of strength, Canada, it added First Ontario Credit Union and a small domestic bank.
More productive for Temenos was Asia/Asia Pacific, with
four wins in Vietnam, two in the Philippines, and one each in India, Indonesia, Myanmar and Taiwan, plus one deal spanning China, Hong Kong and Cambodia. The Middle East was fairly healthy too, with six deals in six countries, so too Africa, with seven deals in seven countries, of which three were in North Africa. In Latin America, there were only solitary deals in Bolivia and Venezuela.
Oracle FSS with Flex cube saw 27 new-namewins, a good
haul and well up on 2013’s 15. It was a fairly similar pattern, geography-wise, to Temenos, except without any North American side to it. Oracle FSS’s strongest territory was Asia/Asia Pacific, with three deals in the Philippines (so a busy year in this country), two in Myanmar, one each in Laos, China, Pakistan, Cambodia and Afghanistan, plus a three-sitedeal for Pakistan, Afghanistan and Tajikistan. There was also a single deal in New Zealand.
It was a like-for-like tally for Oracle FSS in Africa – six deals, six countries, although only one of these was in North Africa. It was sparse pickings in Western Europe– Hampden & Co in the UK and a deal in Denmark, plus one each in Cyprus and Malta – and Central Europe – a solitary win in Belarus. The Middle East only produced single deals in Lebanon and the UAE, while the sole Central and South American win was in a former Temenos stronghold, Mexico (Banco Actinver).
The nine Finacle deals for Infosys were fairly small,
compared with past wins for the Indian heavy weight. It had one in the Philippines, Producers’ Savings Bank, and the rest were spread around low-end banks in Africa and Asia, bar the international operation of an Indian bank in the UK. The Finacle business had posted a 5.4 per cent decline in quarter-on- quarter revenue for Q2 FY2015 in October 2014 and, at presentat least, thelarger-enddeals of previous years areeludingit. Those ninedealsin 2014 werethe same in terms of quantity as 2013. Here, as with the other Indian domestic suppliers, we did not count deals to small domestic Indian banks and co-ops once more.
One supplier thathad a poor year was Path Solutions. It brought in a mere four new wins, in UAE, Saudi Arabia, Gambia andSudan. This was six fewer thanin 2013. We again asked all
Market Dynamics Report 2017 |
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