Core systems

The Federal Housing Finance Agency appears to be on course to decide next year whether Fannie Mae and Freddie Mac should update their credit scoring models.

Ramamurthi has transformed a 123-year-old institution with one branch serving a dusty Kansas town into a seedbed for disruptive financial technology — not to mention a wildly profitable generator of fee income.

Under the direction of Richard Holbrook, Eastern Bank has prepared itself for the next 200 years by embracing a culture innovation, adding scale through acquisitions and advocating for the less fortunate in its community. It's an unusual formula, but it has worked and that's why he is one of American Banker's three Community Bankers of the Year for 2015.

The core-processing vendor FIS wants to dream big like fintech startups when it comes to developing future services, but it also seeks to be large enough to offer multiple services in an era when banks are cutting back on third-party providers.

Bank of the Ozarks' taste for M&A means its information-technology staff has to juggle integration projects and experiments with new software, mobile and other technologies.

Royal Bank of Canada's chief executive, Dave McKay, says the company could roll out a loyalty system kept on a blockchain next year as it experiments with distributed ledgers and looks to enhance its mobile wallet.

Legacy core systems make banks vulnerable to new competitors and risks. Modernization is underway, but many institutions are not moving fast enough. The risk of waiting too long is that it will take too long to catch up.

Financial services technology company Fiserv and bank-owned risk management provider Early Warning are partnering to add scale for deposit accounts and bill payment services.

So many banks are running systems that were implemented before 1984, the year Mark Zuckerberg was born. They’re going to be dead meat in the age of real-time connectivity in the near-free world of today’s mobile Internet.

The chiefs of Fiserv, FIS and TCS Financial Solutions explain how they continue meeting customers' current needs while preparing for the inevitable day when those needs radically change.

The central bank originally established a 10-year time horizon for completing upgrades to the nation's aging electronic payment system. But a task force convened by the Fed thinks that's not ambitious enough.

Cloud Lending Solutions, a technology provider to marketplace lenders and other finance companies, announced that it has raised $8 million in venture funding.

Can true innovation happen when so much of the industry is still working on systems built in the 20th century?

Software problems have recently plagued Bank of New York Mellon, HSBC and the New York Stock Exchange. Thorough testing and new quality standards can help financial institutions weed out weaknesses in their code that could (literally) break the bank.

Standard Treasury, the startup that Silicon Valley Bank absorbed this month, is helping create software gateways for the institution's high-tech business clients to customize the way they interact with it.

FIS and merger partner SunGard, along with all other vendors in the space, have not been able to come to market with innovative core systems or software platforms that adequately address the new digital paradigm banks face.

The $9.1 billion acquisition of SunGard Data Systems would deepen FIS' bench in banking and asset management services and add products for capital markets, dovetailing with banks' desire to narrow the list of companies that serve them.

Community Trust in Ruston, La., took the rare step of replacing its hodgepodge legacy core system. The move should cut processing costs in half. In the meantime, the bank's taking a lot of calls from confused customers.

They're not ready to go all-in by putting core processing in the cloud, but community banks are experimenting with hybrid and quasi-cloud arrangements that offer low costs and rapid deployment.

A deal between two major fintech players to provide core processing hosted in the cloud raises the question of when U.S. banks will feel comfortable putting their most important data on publicly shared computers.