End-To-End Digital Transformation Presents Banks With a Trillion-Dollar Profit Opportunity, Reveals the Newly Launched Temenos Value Benchmark Program
Temenos (SIX: TEMN), the banking software company today announced the first set of results from the Temenos Value Benchmark, a strategic, survey-based program providing in-depth analysis of how software capabilities impact a bank’s profitability. Key findings show that top-performing banks using Temenos software invest in end-to-end digitization, underpinned by state-of-the-art analytics to achieve industry-leading profitability levels.
As a result, these top performing banks using Temenos software have achieved industry-leading cost-income ratios of 25.2% and returns on equity of 25.0%, 2X better than the industry average. These clients also invest over 53% of their IT budget on growth and innovation versus maintenance, which is 2.5X the industry average. These results show the tangible value to be gained if banks are able to digitally transform their businesses and move from legacy-systems to modern, off-the-shelf packaged software running on the latest cloud-native, cloud-agnostic, API-based technology.
Banks are challenged by tough macro-economic conditions, the rise of new competition and evolving customer demands, combined with crippling legacy architectures. However, they have an immense opportunity to harness the power of digitization to transform their business and achieve dramatic profitability improvements. The average return on equity for participating banks in the Temenos Value Benchmark at 15.6% is significantly higher than current industry-average returns on equity of 8% to 10%. This differential translates into up to a massive additional one trillion USD profit potential for the global banking industry were it to digitally transform, assuming a $140 billion increment in operating profit for every 1% increase in return on equity1.
Max Chuard, Chief Executive Officer, Temenos, said: “There is a trillion dollar profit opportunity for banks which move away from legacy systems to modern packaged software running on the latest cloud-native, cloud-agnostic, API-first technology. The case for digital transformation has never been stronger and the urgency for change has never been greater. The results of the Temenos Value Benchmark Program show that Temenos clients are amongst the top performing banks in the industry and by transforming their end-to-end digital banking platform, they have been able to achieve industry-leading profitability levels while innovating faster and delivering exceptional digital experiences for their customers. For most banks, digital transformation is a once in a life project, for us is our full time job. We are proud to take a bank live on our software every day of the week. We help institutions of all types - from large global banks such as Nordea and Standard Chartered to digital-only banks like Varo Money and Volt Bank - to unlock the business value of the digital banking opportunity and drive best-in-class performance and profitability.”
Kanika Hope, Global Strategic Business Advisory Director, Temenos, said: “As the world’s leading provider of packaged banking software, it is our vision and mission to help our clients achieve tangible business value from their IT investment. We therefore launched the Temenos Value Benchmark, a unique program to provide our banking clients, tangible, data-driven insights and recommendations into their business performance, in the spirit of a true strategic partner. Through our benchmark study, we collected thousands of data points around financial and operational metrics as well as qualitative best practices across the entire banking value chain, to understand how specific solution enablers and best practices drive high performance such as better cost-income ratios and improved returns on equity and assets.”
Five Drivers of high-performing banks:
The Temenos Value Benchmark has revealed that top performing banks who have digitally transformed their business and moved away from legacy-systems are able to differentiate across five key areas:
- Product innovation and growth: They launch products and services faster, which result in higher customer growth. These banks can focus their IT spend on growth and innovation rather than maintenance.
- Customer centricity: They engage digitally with more of their customers, cross-sell more and on-board customers faster. All of these contribute to higher customer satisfaction.
- Operational efficiency: They have higher levels of automation driven by straight through processing both, in the front and the back office allowing support of more customers with fewer staff.
- Effective risk and compliance: They have more efficient and effective compliance functions, leading to better staff productivity and more efficient operations. They also spend less of their IT budget on regulation.
- Advanced analytics: They use analytics widely and effectively with a higher proportion of self-service reports and a greater proportion of business users using analytics. They also have a stronger data foundation in terms of lower data duplication across their systems.
Dan Dickinson, CIO, Equitable (EQ) Bank Canada, said: “A great example of the value I got from the Temenos Value Benchmark and why I would encourage my banking counterparts to participate in this program, is the metric I received on the very first page of the report: IT cost as a revenue percentage. This benchmark metric paid off immediately as it revealed to me the true cost of my IT and how I must continue to optimize and automate as I grow my customer base as Canada’s first digital challenger.”
The Temenos Value Benchmark
The Temenos Value Benchmark is a strategic survey-based program to discuss the business and IT metrics and best practices enabled by a bank’s investment in technology. As part of this exercise, banks receive a customized report free of charge comparing their business performance with Temenos clients including executive-level summary of findings with business and IT insights structured along eight banking business and IT domains, across the banking value chain.
To read the insights of the first wave of results from the Temenos Value Benchmark, please visit here.
– Ends –
Temenos AG (SIX: TEMN), headquartered in Geneva, is the world’s leader in banking software, partnering with banks and other financial institutions to transform their businesses and stay ahead of a changing marketplace. Over 3,000 banks across the globe, including 41 of the top 50 banks, rely on Temenos to process both the daily transactions and client interactions of more than 500 million banking customers. Temenos offers cloud-native, cloud-agnostic front office and core banking, payments, fund management and wealth management software products enabling banks to deliver consistent, frictionless customer journeys and gain operational excellence.
Temenos software is proven to enable its top-performing clients to achieve industry-leading cost-income ratios of 25.2% and returns on equity of 25.0%, 2X better than the industry average. These clients also invest over 53% of their IT budget on growth and innovation versus maintenance, which is 2.5X the industry average, proving the banks’ IT investment is adding tangible value to their business.
For more information please visit www.temenos.com.
1 McKinsey Global Banking Review 2017
Jessica Wolfe & Grace Collins
Temenos Global Public Relations
Tel: +1 610 232 2793 & + 44 20 7423 3969
Email : email@example.com
Alistair Kellie & Andrew Adie
Newgate Communications on behalf of Temenos
Tel: +44 20 7680 6550
About Business Wire
(c) 2018 Business Wire, Inc., All rights reserved.
Business Wire, a Berkshire Hathaway company, is the global leader in multiplatform press release distribution.
Subscribe to releases from Business Wire
Subscribe to all the latest releases from Business Wire by registering your e-mail address below. You can unsubscribe at any time.
Latest releases from Business Wire
Newmont Publishes 2019 Sustainability Report1.6.2020 15:00:00 CEST | Press release
Newmont Corporation (NYSE: NEM, TSX: NGT) (Newmont or The Company) today announced the publication of its 2019 Sustainability Report, Beyond the Mine, a transparent and comprehensive disclosure of the Company’s environmental, social and governance (ESG) performance. “Our sustainability report provides investors and other stakeholders a transparent and detailed look at look at our safety, environmental and social performance,” said Tom Palmer, President and Chief Executive Officer. “In 2019, we completed two transformative transactions whilst enhancing our ESG performance to align with our position as the world’s leading gold company.” Newmont’s 2019 sustainability highlights include: Achieving no workplace fatalities and conducting a global safety culture review, which identified several opportunities to enhance Newmont’s Fatality Risk Management program and improve the way fatality risks are managed Further strengthening management of tailings, whilst enhancing transparency through a
New Western Union research provides insight into the future of international education1.6.2020 15:00:00 CEST | Press release
The Western Union Company (NYSE: WU), a leader in cross-border, cross-currency money movement and payments, today shares a new report on “The Future of International Education,” in partnership with The Future Laboratory. The white paper highlights five new student profiles that will evolve from the shifting attitudes and behaviors of today’s youth. From Hybrid Thinkers to Greener Graduates, this new report predicts how academic institutions should adapt to meet these expectations. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200601005162/en/ Meet the students of the future: new student profiles uncovered in “The Future of International Education” (Graphic: Business Wire) The findings come as universities and colleges worldwide are evolving to navigate COVID-19, from moving online, to delaying term dates. Institutions can use the report to ensure the new policies they introduce align with the needs and priorities of interna
FDA Issues Emergency Use Authorization for Impella RP as Therapy for COVID-19 Patients with Right Heart Failure1.6.2020 13:00:00 CEST | Press release
The United States Food and Drug Administration (FDA) has issued an emergency use authorization (EUA) for Impella RP to include patients suffering from COVID-19 related right heart failure or decompensation, including pulmonary embolism (PE). Abiomed (NASDAQ: ABMD) manufactures Impella RP. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200601005257/en/ Impella RP is now FDA indicated for COVID-19 related complications, including pulmonary embolism. (Photo: Business Wire) Impella RP is a temporary heart pump that provides circulatory support for patients who develop right side ventricular failure. Five years of pre- and post-market clinical studies support Impella RP’s safety and efficacy. In 2017, Impella RP received FDA approval as safe and effective for treating right ventricular failure in the setting of acute myocardial infarction and after cardiac surgery. Biventricular cardiac support can be provided when Impella RP is
Vivet’s Second Gene Therapy Product, VTX-803 for PFIC3, Receives US and European Orphan Drug Designation1.6.2020 13:00:00 CEST | Press release
Vivet Therapeutics announced today that both the Food and Drug Administration (FDA) and the European Commission (EC) have granted Orphan Drug Designation (ODD) for Vivet’s second gene therapy product, VTX-803, for the treatment of Progressive Familial Intrahepatic Cholestasis type 3 (PFIC3). PFIC3 is a rare life-threatening and chronically debilitating condition due to progressive severe liver dysfunction, accompanied by jaundice, portal hypertension, hepatosplenomegaly and failure to thrive. The symptoms of the disease usually appear first in childhood with progressive cholestasis, evolving to hepatic failure, cirrhosis and need for liver transplantation. “We are very pleased to receive these designations which further validate Vivet’s efforts to treat rare inherited metabolic disorders. The FDA and EC have both recognized the unmet need for a safe and effective treatment of PFIC3 and the potential of VTX-803 to address such need. The field of Progressive Familial Intrahepatic Cholest
Zynga Enters Into Agreement to Acquire Istanbul-based Peak, Creator of Top Charting Mobile Franchises Toon Blast and Toy Blast1.6.2020 13:00:00 CEST | Press release
Zynga Inc. (Nasdaq: ZNGA), a global leader in interactive entertainment, today announced it has entered into a definitive agreement to acquire Peak, one of the most globally successful mobile gaming companies, for $1.8 billion. Peak brings a 100-person strong team and two Forever Franchises, Toon Blast and Toy Blast, that have consistently ranked in the top 10 and top 20 U.S. iPhone grossing games for over two years, respectively. These franchises add significant scale to Zynga’s live services and will be an additional driver of margin expansion over the coming years. Peak also enhances Zynga’s new game pipeline with additional projects in early development. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200601005142/en/ Zynga Enters Into Agreement to Acquire Istanbul-based Peak, Creator of Top Charting Mobile Franchises Toon Blast and Toy Blast (Graphic: Business Wire) Founded in 2010 by Sidar Sahin, Peak has developed the
bitFlyer Europe and Quazard Partner to Bring First Ever Trading Competition to Botwars Ultimate Trading1.6.2020 06:00:00 CEST | Press release
Leading cryptocurrency exchange bitFlyer, is partnering with crypto-trading game developer Quazard, to bring the first ever gamified trading competition to the Botwars Ultimate Trading universe. This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20200531005005/en/ bitFlyer and Quazard bring the first gamified trading competition to the Botwars Ultimate Trading universe (Graphic: Business Wire) The competition, which launches today, allows Botwars players to compete in a free to enter crypto-trading simulator to win real Bitcoin. This is the first trading competition to launch on Botwars, and the only live trading competition of its type. In Botwars Ultimate Trading, players need to build an army of trading robots (each representing a trade) and lead them into battle to conquer the cryptocurrency markets. Botwars is a real-time, gamified currency trading experience where you will learn new trading skills, unlock powerful new tradin