Accenture plc (ACN) recently entered into an agreement with a subsidiary of Credit Agricole Group, one of the largest European retail banking conglomerates. The Group selected Accenture’s services for CEDICAM, its payment flow and systems subsidiary. Financial terms of the deal were not disclosed.
Under the terms of the agreement, Accenture will develop an information technology (IT) platform for CEDICAM. The advanced IT platform will ensure an easier and smoother collection process of European payments as per the requirements of the European Commission and the French regulator.
Accenture’s solution will enable CEDICAM to launch a new payment processing platform for its clients. The platform will make electronic payment (card payments, credit transfers, direct debits and cross-border processing) simpler and flexible for Europeans.
Accenture shares a good business relationship with the Credit Agricole Group. The Group has been leveraging support from Accenture since 2007 and has modernized its payment operations and systems. Accenture’s proven expertise in developing payment processing systems prompted the Group to deploy its services. We believe that success at CEDICAM could attract more deals from the financial services vertical.
Accenture has been successful across various industrial sectors as well as geographical regions. Recently, the company announced that it will collaborate with Anheuser-Busch InBev (BUD) on a digital merchandising service intended to help the brewer’s point-of-sale activities.
It also won a five-year consulting and outsourcing services contract from CEVA Logistics and a two-year information technology services contract from Israel Electric Corporation. Moreover, Accenture’s core banking solution has been deployed by Banco Bilbao Vizcaya Argentaria S.A.’s (BBVA) U.S. banking subsidiary.
Apart from this, Accenture has also gained a strong foothold in the insurance vertical.
We are encouraged by the healthy growth in revenue and bookings in Accenture’s recently concluded third quarter of 2011. However, the economic turmoil in Europe and competitive pressure from IBM Inc. (IBM) could considerably rationalize Accenture’s growth prospects.
Accenture has a Zacks #3 Rank, implying a short-term Hold recommendation.
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