Core provider FIS increased its banking solutions revenue in the second quarter and reported a strong appetite for technology investments among financial institutions.

“We’re seeing the customers continue to have high demand for banking technology solutions because they’re wanting to drive their own digital transformation,” FIS President Stephanie Ferris said today during the company’s Q2 earnings call.

The Jacksonville, Fla.-based provider’s financial institution clients showed increasing interest in embedded finance and banking-as-a-service technologies, Ferris added.

“FIS is capitalizing on the rising demand for banking-as-a-service solutions as banks seek to create new revenue streams by widening their traditional distribution to end consumers through fintechs,” she said.

As a result of banks and financial institutions investing in digitization during the COVID-19 pandemic, FIS’ banking solutions revenue increased 6% year over year in Q2 to $1.3 billion, according to the earnings supplement. Total revenue increased 8% YoY to $3.7 billion.

Banks boost digital capabilities

Interest in digital capabilities among banks seems not to be “slowing down at all,” Chief Executive Gary Norcross said during the call.

In fact, FIS added five financial institutions to its client roster in Q2, including $119 billion Australia-based ANZ Bank, $20.6 billion Columbia Bank, $30 billion Umpqua Bank, and $50 billion Valley Bank.

ANZ Bank, FIS’ first large bank signed outside of the U.S., expanded its international presence using the core provider’s modern banking platform through Microsoft Azure, according to the earnings presentation. FIS in Q1 shifted its technology and application architecture to the cloud and enabled cloud deployments on Microsoft Azure.

Columbia Bank and Umpqua Bank leaned on FIS for its core consolidation, according to the presentation. Lastly, Valley Bank selected FIS for its core consolidation following its April 2021 acquisition of Bank Leumi, the U.S. subsidiary of Bank Leumi Le-Israel B.M.

Similarly, Bank of America, Citizens and U.S. Bank were among financial institutions that increased tech spend during Q2, according to their earnings presentations.

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