Temenos sunsets Trinovus core banking software business

Temenos shifts focus from US community banks to large FIs

As Temenos is now setting its sights on US banks and FIs with assets over $1 billion, smaller community banks using Trinovus’ Trinisys core system need to find new providers. Trinisys will be sunsetted in June next year.

Trinovus core

Trinovus, an Alabama-based provider of hosted core and auxiliary solutions to community FIs in the US, was purchased by Temenos in early 2013.

Initially, Temenos’ plan was to focus on the community banks segment and develop the respective T24 Model Bank – for Trinovus customers as well as the wider market – to be provided on a hosted basis.

A handful of banks were onboarded in 2013/14. These were AimBank, Farmers Exchange Bank, Independence National Bank, National Bank of Andrews, Clare Bank and Independent Bankers Bank.

Independent Bankers Bank merged into another bank.

The other ones continue to operate today, but none are using T24 as their core system (or are in the implementation process).

Jay Mossman, Temenos’ regional CEO, North America, confirms “no projects are in flight”.

There are currently ten remaining users of Trinisys. About 20 users have already moved to other providers, Banking Technology understands.

Most of the Trinisys users are small entities – with less than $250 million in assets.

“As part of our US strategy we have decided to focus on banks greater than $1 billion in assets with our primary focus on those greater than $10 billion,” Mossman explains.

He cites Commerce Bank as a success story of Temenos’ pursuit of larger US clients. Commerce Bank – the country’s 37th largest bank by assets, with asset size of $24.7 billion – signed to implement T24 last year (as first exclusively reported by Banking Technology).

The T24 US Model Bank development has also shifted away from the community banking sector to addressing the needs of bigger FIs. The new version of T24 US Model Bank will be implemented at Commerce Bank.

“Most of our pipeline today for the US is $10 billion institutions or more, which is more in line with T24 capabilities,” Mossman comments.

A letter has been recently sent out to Trinovus users informing them of Temenos’ plans, Banking Technology understands.

“Based on our strategy we did inform the remaining banks on the Trinovus core system that we were no longer going to enhance the system and would be sun setting as on June 2018,” Mossman says.

“We are currently working with all of the Trinovus core system customers to move to another platform. Until every bank moves off we will continue to support the software and those customers.

“The Trinovus core system will go away and those customers on it will be migrated to a competitive platform better suited for their needs.”

He adds: “The less than $1 billion asset market is dominated by Fiserv and Jack Henry. It is extremely price competitive and most of all it is shrinking quickly.

“Meanwhile, the mid- and large markets are growing. We believe we can better serve the mid-market to large market of banks and credit unions.”

He also emphasises that Temenos is not abandoning the hosting/Software-as-a-Service (SaaS) market in the US. On the contrary: “We have made a multi-million dollar investment this past year in consolidating our many data centres to an AT&T tier 1 data centre in Atlanta with our disaster recovery in Dallas,” he states.

“We are aggressively pushing hosting services along with our software and have a number of opportunities in our pipeline.”

So what about the Trinovus employees?

“Some of the Trinovus core employees will be moved to new roles in Temenos as some had already been cross-trained on T24,” Mossman says. “Some have decided to retire when the last Trinovus customer leaves.”

Compliance business

In addition to core software, Trinovus’ portfolio also includes compliance products, which have 800+ users in the community banking space. These products will continue to be developed.

“We are continuing to sell and grow that business,” Mossman states. “The compliance business is still very important to Temenos.”

He adds: “Matter of fact, we have invested heavily last year to update the technology and we moved it to a more robust data centre a few months ago to handle the increased volume.”

However, the audit business – which was part of the compliance portfolio – has recently been sold.

The audit business was acquired by Temenos from the aforementioned Independent Bankers Bank in 2015. Banking Technology understands this was part of the negotiation with the bank to move to T24. However, as mentioned earlier, Independent Bankers Bank was taken over by another bank, First National Bankers Bank, later that year, and does not exist today.

The audit business is not strategic to the vendor. “We are in the software business and certainly are not auditors,” Mossman notes.

Also, “it had extremely small revenue with margins less than Temenos accepts”.

This business was sold to the Norman Group, a US-based management and technology consultancy firm.

The remaining Trinovus business has now been merged into Temenos USA, and so has another US acquisition of Temenos – Akcelerant Software.

All operating business lines for North America (US and Canada) now fall under the leadership of Emily Steele, the region’s COO.

Like Mossman, she comes from Akcelerant, where she had been president and COO for over a decade. Mossman is Akcelerant founder.

Meanwhile, David Brasfiled, who’d been Trinovus’ CEO since 2009, left the company last year.

“When we are done our overall profitability from what we purchased from Trinovus a few years back will be improved greatly,” Mossman concludes.