Ownership change and further sales


In mid-2013, Capital Banking gained a new part owner, with Holcom Group purchasing a ‘sizeable share’, according to Claude Bahsali, chairman and CEO of Information Technology Group (ITG), Holcom’s affiliate company that signed a partnership agreement with Capital Banking as part of the deal. Lebanon- based ITG works in the IT infrastructure, telco and banking software and service verticals, and was planning to ramp up the latter. This was a complementary partnership, stated Bahsali,


which would bring abundant cross-selling opportunities to both parties. ITG had a large customer base of banks and many could potentially benefit from Capital Banking’s solutions across both conventional and Islamic core banking (for retail and private banks, and capital markets), BI, CRM, risk management and compliance. ITG did not have its own software products, but it had already established tie-ups with other core banking vendors, including Oracle FSS (Flexcube), Infosys (Finacle) and Nucleus Software (FinnOne). Bahsali said that moving forward, CapitalBanker would ‘naturally become the main core banking software partner for ITG for the category of banks and financial institutions targeted by the vendor’s products’. Nicolas Jabbour, group CEO of Capital Banking, commented at the time of the announcement that ‘in the last six weeks there have been about a dozen opportunities that we are jointly working on’. Capital Banking and ITG already had a handful of joint customers, with Bank Audi and Fransabank among them. For the previous three years, Capital Banking had been investing in ‘becoming more dominant in the marketplace’, said Jabbour. A lot had been spent on R&D, both in enhancing the current offerings and developing new products, he stated, and it now needed to be matched with a wider exposure to the markets worldwide. Holcom/ITG was a great fit, he felt. ITG was well-established in the Middle East, plus North and East Africa, whilst Capital Banking was more present in the western part of the continent, he commented. Elsewhere, Capital Banking was still seeking large-scale partnerships with companies the size of Holcom/ITG, said Jabbour. In South America, for instance, the search was underway for an integrator. ‘Working with integrators has not been a tradition at Capital Banking but this is something we have changed now. I sincerely believe it is always better to go through a system integrator,’ he said. ‘Our internal team is not big enough to cover the pipeline that we are anticipating. For the foreseeable future, we will be involving


integrators in every engagement. All engagements will, of course, have a professional Capital Banking services team present, but they will not be necessarily led by us. When I look at our business model, the dollar of software and maintenance is much more valuable than the dollar of services.’


He observed that Capital Banking’s go-to-market strategy had to be adapted in line with the vendor ‘maturing and growing into the business’. No management or organisational restructuring was planned, he added. The supplier’s two new- name deals in 2013 both came in December and were from a French bank (albeit purely for compliance within its corporate banking operations), and in Iraq, at the aforementioned Sumer Commercial Bank. The new system was planned to be centralised at the bank’s head office, spanning its ten-branch network consisting of seven locations in Baghdad and three in other provinces. The bank had aspirations to extend the branch network, and the new system was expected to facilitate this. The initial scope of the roll-out was for base functionality such as deposits, loans and FX, but the bank intended to launch new services such as its own debit cards and ATMs, as well as introduce internet and mobile banking in the future. Middle East Software & Systems was again instrumental in the win. Fouad Hamza Al-Saeed, general manager at Sumer


Commercial Bank, described its current system as ‘obsolete’. ‘We have to keep up with the other banks in the region,’ he said, and CapitalBanker ‘is very convenient for the bank. It fits our forecast and our future plans’. The bank was expecting to go live with the system in August 2014, with training also being provided at the bank by Middle East Software & Systems.


In 2014, CapitalBanker was taken by Banque de l’Habitat


Lebanon. Joseph Sassine, the bank’s chairman and general manager, stated that the bank had been looking for a system that could sustain its ‘rapid growth and changing needs’. Banque de l’Habitat had previously been running an obsolete 20-year old Cobol system which had difficulties in allowing efficient access to information due to it being based on Unix command prompts. The bank intended to use the new system to improve its existing services on the products it currently offered (as it had no plans to offer anything new at that time), and was confident that it would provide improved access to information, the ability to add new channels, and the possibility of adding new modules in the future if necessary. Deloitte helped with the selection.


Universal Banking Systems Market Report | www.ibsintelligence.com 63


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