San Francisco, CA, USA
January 17, 2007Commercial
Lending: Global Trends and the Systems that Enable Them
Report Published by Celent
Globalization, syndication, and trading
of loans, three major trends, allow banks to offer larger loans that large
clients demand, but many banks require new technology to do so.
A sea change is occurring in the global
lending landscape with the United States at the forefront, Europe
following closely, and Japan adopting global practices quite quickly.
Banks outside the top ten in the US are under pressure to compete with
syndicated, multicurrency, and other loans. This has implications for the
technology required to manage these loans. Some banks may not have the
technology necessary to benefit from advances in commercial lending and
will need either a massive overhaul of their commercial lending systems or
a second system to handle these more exotic loans.
Technology vendors have been quick to
respond to the changing commercial lending market. Syndication is becoming
a requirement as the syndicated loan market grows and second tier banks
find that they must offer syndicated loans to compete with top tier banks.
In response, lending solution providers have been evolving to meet those
needs with ASP models and solutions that run on less costly platforms.
The vendors break down into three sets:
- International best of breed systems:
ACBS and Loan IQ
- US domestic best of breed systems: AFS
and Shaw
- Commercial lending modules from mature
universal banking systems: FLEXCUBE and T24
Celent has used its ABCD Analysis to
examine these solutions and rank them on:
Advanced Technology, Breadth of Functionality (front to back), Customer
Base, and Depth of Functionality (features).
AFS Vision leads in depth of functionality,
but has yet to be deployed. ACBS and LoanIQ are the top systems that are
installed across the world. T24 has a large customer base due to its wide
deployment as both an international branch solution and a stand-alone
solution. FLEXCUBE is investing in more functionality through both
acquisition and internal development. Shaw has chosen to stay in the US
domestic market.
According to Bart
Narter, author of the report and senior analyst in the banking group
at Celent, “Globalization is a phenomenon that is permeating the
business world. Banks that can’t support their customers as they move
overseas will find that they are creating opportunities for a competitor
to enter the account.”
The report is 60 pages long and includes 23
figures and 15 tables. A table of contents
is available online.
|
