Magazine article American Banker

The Deal on Corillian-Wamu Deal

Magazine article American Banker

The Deal on Corillian-Wamu Deal

Article excerpt

This much is certain: Corillian Corp. has won a contract with the thrift giant Washington Mutual Inc.

There was some uncertainty when Corillian revealed in its first-quarter earnings report last week that it had landed "another top 10 U.S. financial institution" as a user of its Internet banking software.

The Portland, Ore., vendor's Wednesday news release had strongly hinted that $224-billion asset Wamu, the nation's eighth-largest financial services institution by assets, was the new client.

Executives at Corillian named the name in a quarterly earnings conference call after the release, on Wednesday night, saying that Wamu was the win. But there was more confusion -- the announcement of the contract said the institution would be using the vendor's Voyager software for its retail and small-business banking customers.

A spokeswoman for the Seattle company said later, however, that Wamu had only licensed Corillian's small-business banking software.

An analyst who participated in Corillian's earnings call, John Kraft of D.A. Davidson in Portland, raised his rating to "buy" from "neutral" on Thursday. One reason he did so, he said, was that it was his understanding that Washington Mutual had bought in on both sides.

In an interview Friday, Mr. Kraft said he was surprised to learn that Wamu was not licensing Corillian's retail banking software.

But the analyst said he was standing by his upgrade of Corillian. "There was a lag where they didn't get any big deals," he said. "Then they got SouthTrust, which was huge, and Washington Mutual, which was even bigger."

Corillian announced April 10 that $48.8-billion asset SouthTrust Bank, a subsidiary of SouthTrust Corp. of Birmingham, Ala., had signed with it in a joint effort with Dayton, Ohio-based NCR Corp., the ATM manufacturer.

More important to Mr. Kraft, however, was Corillian's balance sheet. …

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