Fundtech Banking Survey Finds Consensus: Corporate Clients Want to Improve STP with Banks

2005 forecast shows IT spending up and outsourcing more popular

Jersey City, NJ, January 18, 2005 — Fundtech Ltd. (NASDAQ: FNDT), a leading provider of financial technology software and services, today announced the results of a survey taken at their recent International Client Forum held in London in December. The survey results represent the opinions of 58 senior level managers from 22 of the world’s most influential banks.

Key findings of Fundtech’s survey show that:

· All of the respondents (100%) said that their corporate clients are aware of the STP (straight through processing) rate between their back office and the bank and that 54% of them are actively working to improve this rate.

· 55% of the respondents said their institution is more interested in outsourcing this year than last year, but only 13% felt the potential for outsourcing had decreased. As an example of this, of those banks that will invest in Target 2 systems in 2005, 60% said they would outsource by either purchasing software or connecting with an application service provider (ASP).

· 69% said that their IT budgets would grow in 2005. While 13% of banks are planning to increase their technology budget by more than 10%, 56% of executives surveyed said their bank plans to increase its technology budget by 0-10%. This is in line with TowerGroup’s recent predictions of a 4.4% rise in technology spending in 2005 by the banking industry.

· Banks were split over their priorities for 2005, with 27% focusing on operational savings, 27% focusing on increased revenue production and 26% who considered increased customer services to be their top priority.

George Ravich, SVP and Chief Marketing Officer of Fundtech, commented on the survey results: "The results of this year’s survey give a valuable insight into our client’s plans and their priorities. Our recent introduction of OmniPAY addresses our clients need to expand STP into the back offices of their corporate clients, and to expand revenues through the introduction of enhanced services.

He added: "Outsourcing remains a strong trend in the marketplace and is reflected in Fundtech’s business growth. Currently, these services are our fastest growing, accounting for approximately 14% of revenue."

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