A Snapshot of the Global Core Banking Market

by Bart Narter,  Stephen Greer, April 4, 2012
Industry Trends
Global, Asia-Pacific, EMEA, Latin America, North America

Abstract

Over the last decade, financial institutions around the world have begun to adopt modern core banking systems to support and upgrade their products and services and survive in an ever-more competitive banking climate. Banks are increasingly looking toward modern solutions to overcome constraints in their existing environments. The degree of core banking adoption varies across geographies, with most developed countries having already gone through legacy transformations decades ago.

In the new report, A Snapshot of the Global Core Banking Market, Celent discusses the market overview in each of the regions covered (North America, Western Europe, Latin America, APAC, EEMEA) and provides market share estimates of the top vendors in each region. The estimates are classified into <$1 billion asset banks, $1-20 billion asset banks, and >$20 billion asset banks. The report also looks at ASP vs. on-premise installations geographically, and overall market size.

With noticeable variability in size of the deals, pricing, and functionalities being implemented around the world, it is a tough proposition to value the market. In this report, Celent tries to value the core banking market by considering the sum of project costs of core banking replacement projects for the top 500 banks (both maintenance costs and fresh implementation costs) and using that as a proxy since the large bank market forms the bulk of the total core banking market value. Celent has estimated the total core banking market size to be around $4.8 billion for the year 2011. The market is expected to grow to $5.1 billion by the end of 2013.

“Coming out of the economic crisis, banks scaled back their IT spending, but spending has started to rise,” says Stephen Greer, Analyst with Celent’s Banking group and coauthor of the report. “The total number of core deals from 2010 has decreased slightly, yet the overall deal sizes have increased, and the future is looking better for the core banking industry.”

This report provides the market overview regionally, covering North America, Western Europe, Latin America, Asia-Pacific, and EEMEA. Celent also compares ASP to on-premise installations across the provided asset tiers and geographies. Finally, the report estimates the complete core banking market size by way of cost and fee calculations, geographical demand, and market valuation.

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is part of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America (Boston)
Tylor Tourville
ttourville@celent.com
Tel.: +1 617 424 3284

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)208 870 7875

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81.3.3500.3023

Table of Contents

Executive Summary

3

Geographical Market Overview

6

 

North America

6

 

Western Europe

10

 

Asia-Pacific

15

 

Eastern Europe, Middle East Asia, and Africa (EEMEA)

20

 

Latin America

25

 

ASP Vs. On-Premise

28

Core Banking Market Size Estimate

33

 

Initial Estimates

33

 

Geographical Demand

34

 

Pricing Estimates

35

 

Market Valuation

36

Conclusion

38

Leveraging Celent’s Expertise

39

 

Support for Financial Institutions

39

 

Support for Vendors

39

Related Celent Research

40

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