Banks of all levels, from large global firms to credit unions and challenger banks, are expressing interest in modernizing their core, Temenos Americas President Jacqueline White tells Bank Automation News in this week’s episode of “The Buzz” podcast.
The reason varies, but core technology is aging, and with it the employees who can code in the older systems, White said. That’s pushing some financial institutions to move to newer, often cloud-based, solutions with less complexity, she added.
“A lot of organizations are looking around and seeing that the only individuals who know how to code in their current system or know anything about the complexity and the customizations are retiring or leaving the organization,” White said. “At Temenos we call it the ‘legacy spaghetti.’ It's very complicated. It's tangled up, it's confusing.”
Banks are also enticed by the advanced data analytics capabilities newer solutions can offer, she added. Financial services software provider Temenos is addressing the desire for more data through a partnership with cloud-based customer relationship management solution Salesforce. The offering will give “a deeper dimension into everything from bank employees that are sitting in the branch to those who are sitting in the call centers and opening accounts,” White said.
Another data-driven play is Temenos’ May announcement that it’s piloting a virtual chief operating officer (COO) at the $28.7 billion Canadian Western Bank, White said. The artificial intelligence-driven tool helps small and mid-sized businesses (SMBs) understand cash flow, White said.
“It's all automated,” White said. “It’s taking that data from the core and helping to make it intelligent and useful within the bank, because you have this tremendous amount of data and detail on users, what their needs are, how they operate.”
The virtual COO, which will help the bank support SMBs with tailored lending options, will officially go live in January, she added.
Earlier this year, the Geneva, Switzerland-based bank launched the Temenos Banking Cloud, an ala carte solution that lets banks subscribe to banking services without a complete core upgrade. Currently, it has more than 700 customers, White said.
“The idea of coming to a provider for a turnkey solution, again, from that back end, back-office core to the front end, digital experience in a hosted cloud environment is very appealing and very intriguing to our users,” White said. “It's being very well received and adopted.”
North American FIs are flocking to Temenos for solutions. In the first half of the year, the provider signed $5 billion Wescom Credit Union and is in the process of signing the $8.6 billion Delta Community CU, the $1.8 billion Sharonview FCU and the $357.4 million Bank of Clarendon. In Canada, Temenos recently signed Saven Financial, a division of $3.9 billion FirstOntario, for a digital parallel bank to go live, and also signed on the $5.3 billion BlueShore Financial for additional products and SASCU to extend its partnership.
Globally, the software provider is signing the Egypt-based Alex Bank and extending its partnership with the $407.9 billion Standard Chartered, a British multinational banking and financial services firm, to support its growing financing and securities services offering.
Temenos [OTCMKTS: TMSNY] shares were trading at $151.78 at 2:09 p.m., up 1.48% as of market open.