Treasury and Risk Management Applications Market 2010-2015


This applications market sizing report focuses on the 2010 performance of the top 10 applications vendors in the treasury and risk management applications market.

With renewed interest in effective automation of cash management and treasury function, corporations and financial institutions are investing heavily in tools that help them better manage such tasks as portfolio modeling, hedge accounting as well as cash forecasting. This comes at a time when companies of all sizes are still reeling from credit squeeze exacerbated by one of the worst financial crises in generations. In many cases these organizations have turned to the latest technologies to help them navigate the choppy waters of global finance by achieving a holistic view of risk.

As a result, many treasury and risk management applications vendors have seen double-digit increase in their revenues over the past year. There are signs that their momentum will continue having made a series of acquisitions to shore up their offerings, while expanding into emerging countries through ecosystem building efforts.

Top Line and Bottom Line

On the top line, the treasury and risk management applications market is expected to grow faster than software systems designed for the financial services vertical, which remains stuck at the low single-digit level because of general weakness in the banking and insurance sectors with many small and midsized financial institutions still struggling with recession hangover.

By comparison, treasury and risk management applications vendors, which target both corporations and FIs, have an easier time to convince customers about the intrinsic value of their offerings in light of another looming global slump hit by the combined effects of high oil and commodity prices, natural disasters in Japan, as well as the turmoil in the Middle East.

All these are making corporations and banks more nervous than ever, prompting them to look to treasury and risk management as an effective means to assess and analyze their exposure with a standardized approach.

Following their moves to bulk up offerings through mergers and acquisitions, treasury and risk management applications vendors are positioning themselves as one-stop shops for banks and investment managers who have every intention to reduce the number of technology providers they work with by consolidating their front to back office automation work in order to reduce operating costs.

Another major underpinning of the treasury and risk management applications market lies in the rapid adoptions of on-demand delivery by its customers, many of whom are fast-growing hedge funds and multinationals that have no qualms about leveraging the Cloud as the vehicle to access the latest software tools in order to help them better manage their far-flung operations without incurring considerable IT expenses. TRM vendors, some of which have been among the earliest supporters of on-demand delivery, have benefited from such widespread adoptions.

After years of living in the shadows of financial technology providers and general-purpose accounting solutions, treasury and risk management applications vendors have found their own standing, which appears to be more strategic than ever in the eyes of corporate treasurers, CFOs and CROs. That means the current crop of top TRM vendors are finally getting the attention they deserve, a process that usually leads to further consolidation that could upend the entire market.

Market Definitions and Overview

The market for treasury and risk management applications is defined as follows:

  • Automation of business processes that support corporate treasury operations (including the treasuries of financial services enterprises) with the corresponding financial institution functionality and optimize related cash management, deal management, and risk management functions as follows:
  • Cash management automation includes several treasury processes involving electronic payment authorization, bank relationship management, cash forecasting, and others.
  • Deal management automation includes processes for the implementation of trading controls, the creation of new instruments, market data interface from manual or third-party sources, and others.
  • Risk management automation includes performance analysis, Financial Accounting Standard (FAS) 133 compliance, various metrics calculations used in fixed-income portfolio analysis, market-to-market valuations, and others.

In 2010 two of the top 10 treasury and risk management applications vendors were absorbed by much bigger players in the financial services vertical heralding a new era that could mark a turning point in the evolution of the TRM market.

The acquisitions of Sophis by banking applications specialist Misys and FRS Global by Wolters Kluwer, a $5- billion Dutch conglomerate that sells into financial services companies along with other verticals, underscored the appeal of treasury and risk management solutions as the linchpin for these larger players to pitch their extensive product portfolios to their existing customers in hopes of swapping out their legacy systems with these newly acquired technology assets.

To be fair, Misys has always had a strong lineup of treasury and risk management applications with names like Risk Vision, Opics Plus and Summit, the purchase of Sophis for nearly $600 million catapulted the combined entity to the leadership position.

The moves were also a validation of the strategies of the other major contenders in the TRM market SunGard and Wall Street Systems, both of which have been expanding their offerings through internal development efforts as well as well-timed acquisitions. The question is whether SunGard and Wall Street Systems are going to stay put or pair up with similar entities in the financial services vertical in order to erase the lead held by Misys. For its part, Wolters Kluwer has been snapping up software companies in different verticals in order to offset declines in its traditional print publishing market.

As treasury and risk management features become more integrated into core financial systems – as well as a new class of Governance, Risk and Compliance applications derived from enhanced business analytics software – it is fair to assume that the days of traditional best-of-breed TRM systems may be numbered.

Still the TRM applications market remains highly fragmented with dozens of niche vendors doing brisk business selling their dedicated treasury workstation products to corporate treasurers or in-house banks in need of using highly specialized software to handle a dizzying array of cash management requirements borne out the growing complexity of commodity derivatives or financial instruments being used to keep their operations afloat.


Because of unique user requirements, treasury and risk management applications vendors have been targeting a relatively small group of power users even when selling into large organizations. The proliferation of hedge funds over the past 10 years has proven to be a bonanza for treasury and risk management applications vendors as many of these financial services companies were keen on using off-the-shelf solutions to sustain their rapid growth in different regions.

Despite their growing popularity, the number of customers of most TRM vendors has barely budged over the years. While the major vendors such as SunGard and Wall Street Systems have been able to secure several thousand customers each, the installed base of other providers could run anywhere between 100 and 500 with the number of users rarely exceeding 10,000.

Kyriba, a San Diego, CA-based on-demand vendor that specializes in cash and treasury management, is an exception. Though the number of its customers remains fairly small at more than 360, its base of subscribers has exceeded 12,500. Two years earlier, Kyriba had 200 clients with 7,000 subscribers.

The challenge facing these vendors is two-fold. While the market is expected to grow over the next few years, the actual number of greenfield customers, or net new users for that matter, may not be substantially different from what most vendors are getting in a given year. Hence much of the growth will be coming from replacing existing legacy systems as well as the reliance of fast-track implementations or Cloud-based services as a key differentiator for any customer considering switching to a new system.

In either case, there is a possibility of a bruising price waiting to happen before anyone can capture a large number of net new customers. Another scenario calls for some of the vendors, especially those that have other products like core banking and GRC to sell, to offer attractive bundles as an extra incentive for customers to make the switch.

The bottom line is that best-of-breed TRM applications vendors may risk painting themselves into a corner or they may end up running up against others that can offer more bells and whistles without the high price.

Top 10 Applications Vendors In Enterprise Market

The following table lists the 2010 shares of the top 10 applications vendors in the treasury and risk management market and their 2009 to 2010 applications revenues(license, maintenance and subscription) from the market.

Top 10 Applications Vendors In Enterprise Market
Top 10 Applications Vendors In Enterprise Market

Vendors To Watch

In 2011 Kyriba is expected to fuel its high-octane growth after securing a $10.6 million funding. Last year Kyriba, which specializes in on-demand cash and treasury management offerings, posted a 43% growth in recurring revenues after adding 130 new clients.

Temenos, a Geneva, Switzerland-based core banking application vendor that also offers T-Risk for risk management, is another player to watch following its recent acquisitions of Viveo Group in France and Odyssey Group in Luxembourg. Viveo specialized in core banking and complementary applications for financial institutions, while Odyssey focused on private bank and wealth management markets.

In addition, Temenos strengthened its ecosystem last year by partnering with CSC and Cap Gemini positioning itself as the total solution provider for major banks in different regions. Partnerships with infrastructure providers such as Microsoft have added credibility to Temenos’ product roadmap, helping usher in new ways of handling tasks such as operational analytics and risk monitoring with off-the-shelf tools that used to be developed internally by banks.

Another challenger is Murex, which specializes in cross-asset trading, risk management and processing solutions. Based in Paris, Murex has been gaining traction with its on-demand offerings that emphasize rapid implementations that take as little as three months and reduced total cost of ownership involving complex reengineering and system consolidation projects that are based on its MXpress methodology for standard documentation and training.


On the upside, the prospects of the treasury and risk management market have improved considerably along with the general recovery of global financial markets. Appetite for risks has returned with worldwide merger and acquisition activities in the first quarter of 2011 reaching their pre-crisis levels. Both conditions could result in sustainable growth in the TRM market.

Additionally the acquisitions of Sophis and FRSGlobal by Misys and Wolters Kluwer, respectively, will yield shortterm growth by capturing more cross-sell and upsell opportunities among their existing customers. Any incremental revenue they can generate will whet the appetite of other financial services technology providers triggering similar moves to expand in the TRM space.

On the downside, the earthquake, tsunami and nuclear disasters in Japan have cast a dark cloud over the near-term potential of TRM vendors focusing on the Japanese market. The geopolitical turmoil unfolding in the Middle East could also upend another important market for TRM vendors with a growing base of Islamic banking customers.

If there was any lesson to be learned from the most recent global financial crisis, it was the fact that many companies were not aware of the level of risks they were exposed to, let alone preparing themselves for the worst case scenario. Those that are left standing will have additional reasons to appreciate the intrinsic value of treasury and risk management.

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Treasury and Risk Management Applications Market 2010-2015