SOURCE: Bradway Research LLC

February 19, 2009 09:30 ET

Bradway Research Projects Uneven Revenues and Spotty Growth for Six Core Banking Vendors in 2009

Analysis Segments Vendors; Identifies Drivers and Inhibitors

FRAMINGHAM, MA--(Marketwire - February 19, 2009) - Bradway Research LLC analyzed the 2008 and fourth Quarter 2008 earnings reports and related presentations of the six big, public, core banking vendors: Fiserv, Fidelity National Information Services, Metavante, Jack Henry & Associates, Misys, and Temenos. These six vendors represent the four largest US core banking vendors and the two largest international core banking vendors based on core banking installations. FinTech vendors are trying to calibrate the consequences of the US and global recessions for 2009 amid heightened uncertainty. Year-end earnings (Misys and Jack Henry reported mid-year results) and 2009 guidance was disclosed by each company between January 30th and February 18th, providing a timely perspective on the outlook for these companies.

According to Bill Bradway, founder and managing director of Bradway Research, "The big core banking vendors are considered 'bell weather' leaders of the FinTech industry. If this group fares well there may be hope for growth in overall IT spending for the banking industry." Bradway continued, "If this group struggles, then future growth in FinTech IT spending becomes uncertain and perhaps even gloomy. The outlook for these six core banking vendors in 2009 is uneven and spotty, marked by some regional and/or product/solution differences."

An analysis of the revenues for these vendors identifies the key revenue drivers (where present) and inhibitors to revenue growth (where present). The analysis of 2009 prospects for the vendors places each one into one of three categories: gaining ground; running hard to stay with the pack; and struggling to keep up. The primary sources of revenue for these vendors are initial software license fees, software maintenance fees, and services. This latter category includes outsourcing revenues, payment processing revenues, and professional services projects. Each vendor's revenue mix is dependent on its portfolio of solutions, method of delivering solutions (in-house, outsourcing), key institution market segments, and US vs. international revenue mix.

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