Before Fidelity leverages its new Metavante bench strength to release a super next gen integrated core banking suite, Temenos wants to make one thing perfectly clear: it still has a contract with Metavante.
Temenos is sticking to its guns with regard to its May 2007 deal with Metavante; the Geneva-based core processing vendor issuing a statement saying that the contract “concerning the joint development and marketing of TCB in the US is binding upon both parties and assigns to successors in the case of either party being acquired.”
Metavante’s February 2007 deal with Temenos to co-develop and market a next generation core banking platform based on Temenos' TCB product is now under fire, with the combined Fidelity National Information Services/Metavante promising not to abandon their existing core processing platforms but to develop their next generation core product in an integrated way. “We have two products to choose from, we’ll pick one,” Fidelity executives said in a conference call with investors Wednesday morning.
Analysts say the imperative that Metavante felt when it forged its deal with Temenos--to leap-frog U.S. competitors with a customer-centric, real time system--are answered in Fidelity’s Profile platform. “Fidelity clearly has a go-forward platform for big banks in profile, they’ve invested heavily in it,” says Bart Narter, svp in Celent’s banking group. “Are they going to pull the plug on that (Temenos) project and put that money into profile? If I were in their shoes I would probably pull the plug on it.”
Fidelity’s acquisition of Metavante comes at a time when the core banking market in the U.S. is relatively stagnant, with just the usual contract renewals coming up in the community bank market, but almost no deals in the mid- or top-tier markets. The red herring in the mix are core swap outs planned at Union Bank and BBVA Compass--both foreign-owned banks looking to unify acquisitions on their home platforms. Infosys has reportedly won the Union Bank deal, but despite their perceived product advantages international vendors like Temenos, Infosys and SAP have yet to achieve notable client wins in the U.S. because their systems have not yet been modified for the U.S. banking regulations.