Infinity Financial Technology Inc., a provider capital-markets and treasury software to major banks, announced last month that it had formed consulting alliances with American Management Systems Inc. and Andersen Consulting.

Officials at the Mountain View, Calif.-based company said that as part of the agreements the two firms will use Infinity's line of risk management software, collectively called Montage, as part of their systems integration work with commercial banks and investment houses.

The alliances come at a time when many banks are spending tens of millions of dollars to upgrade their risk management systems to quickly and accurately measure positions in potentially volatile derivative instruments.

"There is a broad gap between the possibilities of sophisticated finance theory and the current practice in today's financial institutions," said Mark Rodrigues, a vice president at Fairfax, Va.-based American Management Systems. "That gap is part culture and part technology. With Infinity, we can create an infrastructure that allows the organization to learn about risk."

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