If You’re Not Happy With Your Bank’s Core System, There are 101 Solutions Offered by 32 Vendors Who Would Love to Talk to You, Maybe

Implications: First, a few definitions for the sake of context clarity  -  A “solution” is any brand name system offered as an in-house system or outsource service, and driven by the owner of the system, or a third party.The group of 32 vendors includes any company that has customers that rely on that company to keep their core system running, but all 32 vendors may not be in the business of selling their system to the entire U.S. population of Finical Institutions (FIs).  Thus the reason for the “maybe” in the title.  The distinction of selling core systems to any FI in the world applies to about a dozen companies.

Analysis:  There are 57 unique brands of core systems in the marketplace, but unlike the Heinz 57 Varieties, these core systems are more like 57 types of ketchup.  Some of them won’t top the list of most widely used systems, but try telling Bank of America they should abandon the core system that Fidelity National Information Services supports because it is not one of the most popular ones.Fiserv’s ITI Premier system is the most widely used core system by third party processors.  Fiserv’s P&L doesn’t mind that kind of competition.  But why is Fiserv’s M&A guy sleeping at the switch?  There are a dozen good old fashioned acquisitions sitting out there, just like the ones George used to pick, like ripe plums off a tree.  Maybe it’s because they look more like clubs, owned and operated by their members.Exhibit 68 (the 101 solutions) was originally created as an educational tool.  It was important for my clients, who hired me to recommend a core solution, to know what the entire playing field looked like.  Experience taught me there will always be a “Monday morning quarterback” who will challenge Sunday’s game decisions.  It’s true in banking, whether it be a bank examiner or the pharmacist on the board of a community bank who thinks he is a computer expert because he owns a PC.  With my list, the CEO of any bank will be prepared to take on all critics.  For example, he might say, “We looked at ABC and disqualified the solution for these reasons,” or “There’s no such company as XYZ that offers a core solution for banks,”  or “That’s a credit union system, and we’re a commercial bank,” or “As a de novo, we don’t have $25 million to license the Hogan System,” or any number of other challenges from the “Monday morning experts.”After 321 assignments, I believe I’ve heard every challenger’s after-the-decision alternative choice except maybe, “My brother in law is a banker and he picked up a great system that fell off the back of a truck.”  The closest was, “My brother in law uses that system and he swears by it.”  “That system,” by the way, is now catalogued under the heading of vaporware, along with ten other solutions that created an initial stir but didn’t last.