Misys and HCL will integrate loan origination tool and strengthen front-to-back loan solutions for wholesale and commercial banks.

A new technology solution for banks originating commercial loans is to be brought to market as a result of an extended alliance between Misys, the global application software and services company, and the HCL CapitalStream Lending Group, a division of HCL Technologies which provides straight through processing (STP) solutions for lending operations.

Despite the instability in financial markets, commercial and wholesale banks are still demanding front-to-back integrated solutions which enable straight through processing of commercial loans to boost efficiency and improve risk management. Specifically, Misys has experienced an increase in demand from tier 2 banks in the West and financial institutions in emerging economies in Asia Pacific and the Middle East.

To meet the needs of these institutions, Misys and HCL will work together to integrate HCL’s CapitalStream solution, the leading platform for business and commercial loan origination, into Misys’ market leading commercial lending solution suite, Misys Loan IQ. The addition of HCL’s expertise in loan origination affirms Misys Loan IQ as a complete front-to-back loan solution. Misys will market the new integrated loan origination module under its own brand to complement its existing modules for front office loan syndication and secondary trading, back office loan servicing, compliance monitoring and reporting across front, middle and back office operations.

Ken Katz, Misys Loan IQ global product manager comments: “Banks are asking us to help them improve STP, to rationalize systems and to get more out of the technology they currently use and this move puts us in a great position to help with these problems. This market is currently served by smaller niche vendors, and a partnership between two established global solutions providers like Misys and HCL provides more choice for commercial lenders wanting to avoid risk in systems selection.”

“According to the 2008 CapitalStream Survey of Best Practices in Business and Commercial Lending, STP is the most popular initiative in business and commercial lending with 60% of the 180 banks surveyed planning to implement or improve their STP platforms in the next two years,” says Kevin Riegelsberger, senior vice president and head of the HCL CapitalStream Lending Group. “HCL and Misys have been close partners for some time, and we are very excited about this new initiative as it allows Misys and HCL to offer a complete, integrated end-to-end STP platform for lending just as the market is focusing on straight through processing.”

Within the terms of the new alliance, Misys and HCL will also grant each other licenses to distribute the other party’s product and refer banking customers to each other to ensure optimal service to the wholesale banking sector.

Misys and HCL initially created an alliance in October 2007 covering emerging markets which introduced joint provision of banking services capabilities to new customers and go-to-market initiatives and empowered HCL to take over maintenance and development in banking products and solutions. The first customers signed under the alliance were Indian Overseas Bank and the Metro Bank in Manila, Philippines to upgrade their installations of the Misys Midas core banking suite and the Misys Opics Plus treasury management solution. In November 2008, Misys and HCL agreed to extend their strategic partnership to the Americas, Europe and the rest of the Asia Pacific region.

Misys Solutions for Treasury & Capital Markets has 18 years of loan market experience and unrivalled software development expertise. It creates integrated, comprehensive solutions for financial institutions to manage their capital market activities across multiple asset classes. Misys Loan IQ is already used by 13 of the top 20 Syndicated Loan Book runners globally, accounting for over 1/3 of the world’s syndicated loans.