Competition among Swiss banking IT providers is as tough as never before. Some companies have been able to profit from the consolidation within the banking industry – while the biggest competitor seems to have failed to win a major order recently.

The consolidation within the finance industry makes business tougher for service providers as well, for instance IT solutions companies. A study by Active Sourcing consultants published today shows that there has been a major shift in market share in the industry in the first nine months of the year.

The winners are Avaloq and Avaloq Sourcing, Temenos and Inventx. Swisscom seems to be the biggest decliner, according to the study «Handout Swiss Banking».

Business Process Outsourcing Biggest Gainer

The study analyzed three different segments: core banking systems, IT outsourcing and business process outsourcing (BPO). The BPO market segment expanded the most, adding 26 percent in the first three quarters of the year.

The main reason for the boom within BPO is Arizon, the joint venture between Avaloq and Raiffeisen. Arizon has a BPO market share of 16.8 percent.

Avaloq Remains a Winner

The market share of Avaloq Sourcing, the BPO unit of Avaloq, has dropped as a consequence of the joint venture. But Avaloq still is a winner, with a combined BPO market share of 29.2 percent.

The company's business has held up well even after it lost BSI as a BPO customer. It won Axion Swiss Bank, the Swiss unit of BBVA, as well as Banque Privée Edmond de Rothschild to compensate for BSI.

Core Banking Systems: Temenos

Avaloq also is the leading provider of core banking systems (see table). But the winner of the year so far is Temenos. The Geneva-based company received the order to merge the IT platforms of EFG International and BSI. BSI used to be an Avaloq client. Julius Baer also opted for the Temenos solution, but will introduce it in Singapore first.

 Bankenlosung gewichtet nach Anzahl Mitarbeitenden

Temenos has been able to increase its market share to 9 percent from 3.6 percent, overtaking TCS Bancs (5.8 percent) and Olympic (5.5 percent).

Avaloq has a market share of 48.5 percent. It has been able to compensate for the loss of BSI, acquiring five new customers so far this year. Finnova, the No. 2 in the market segment, has lost market share, even if it held on to its customers.

IT Outsourcing

In IT outsourcing, Swisscom's market share dropped to 38.9 percent from 45.6 percent because 15 Clientis banks and a further 10 RBA-banks stopped using the Swisscom banking IT solution.

ITO Losung gewichtet nach Anzahl Mitarbeitenden

Inventx by contrast is the winner of the year in this segment. The market share of the Chur-based company increased to 13.9 percent.

Swisscom Struggles But Remains No. 1

The company, which is controlled by the Swiss state, has had its last sales success two years ago, when it reached an agreement with Zuercher Kantonalbank. Swisscom remains market leader in IT outsourcing and BPO.