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TBR Analyst: Accenture to Build Blockchain-Powered Financial Services Platform

Reading Time: 2 minutes by on January 10, 2016 Business, Finance, News
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Management consulting firm Accenture has agreed to acquire Formicary, a leading provider of consulting and systems integration services for trading platforms in the UK and North America, an agreement that follows shortly after Accenture’s acquisition of Beacon Consulting, an asset management consultancy, in December 2015.

Both acquisitions are intended to enrich Accenture’s capital market capabilities and expertise, and may become part of the firm’s bigger plans to build a financial services platform for online retailers powered by blockchain technology, according to Bozhidar Hristov, a professional services analyst at Technology Business Research (TBR).

Although Hristov, who covers Accenture for TBR, acknowledged not knowing the exact intention of the firm with the acquisition of Formicary, he told CRN Magazine that Accenture is indeed “looking into” Bitcoin and blockchain technology.

“[Blockchain] could be the next disruption of the financial services industry,” Hristov told the service. “It is good for Accenture … to have an understanding of the next wave of Bitcoin.”

According to Stephanie Artigliere, another analyst at TBR, Accenture has “an aggressive acquisition strategy … to get ahead of competitors.”

“Accenture is always on the lookout,” she said, adding that the firm had allocated nearly $1 billion USD for acquisitions in 2016.

Both acquisitions will provide Accenture’s financial services operating group with better competence in financial trading systems consulting, as well as system integration expertise, therby enabling the firm to build an industry-specific talent pool, Artigliere said.

Owen Jelf, global managing director of Accenture’s Capital Markets practice, said in a release that the acquisition of Formicary will help the company “strengthen our trading services capabilities to help financial services firms become more competitive and adaptive to change in continuously evolving markets.”

He further argued that “investment banks need to consider alternatives to costly, overly complex, bespoke trading systems, which are hindering their ability to be cost-efficient, compliant with the latest regulations and competitive in highly regulated and active markets.”

Founded in 2000, Formicary specializes in financial trading systems consulting, systems integration and migration, and IT services and software for over-the-counter clearing.

Formicary’s clients include tier-one investment banks, hedge funds, clearing houses and fund administrators. The company has worked on implementations of industry-leading trading platforms including Murex, Calypso and Misys Summit.

Joseph Do, managing director at Formicary, said that combining his company’s knowledge in trading tech with Accenture’s global capabilities will allow clients to benefit from “a strong scalable portfolio of services.”

“As significant cost pressures continue to force capital markets firms to re-evaluate their trading capabilities, our combined efforts will enable us to deliver large-scale digital transformations that can help them reduce costs while increasing the scale and profitability of their trading operations.”

Earlier this week, Accenture announced the 15 startups selected to join its Fintech Innovation Lab in London, among which is Crowdaura, a startup that is proposing a platform powered by blockchain technology to execute clearing, settlement and depository services for financial products.

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