Deutsche, UBS Warburg back Rolfe & Nolan

Deutsche Bank and UBS Warburg have agreed to fund the development of the first two modules of Rolfe & Nolan's much-awaited Merlin software suite in return for long-term licensing agreements.

The London-based derivatives software vendor's project, which also includes the Royal Bank of Scotland and Barclays as strategic partners - although Rolfe & Nolan chief executive Bob Freeman remained tight-lipped about their involvement - was initially scheduled over a three-year period. The Merlin project now enters the development or ‘code writing phase', which, according to Freeman is expected to come to fruition towards the end of August 2002.

Merlin represents Rolfe & Nolan’s attempt to turn around its recently flagging fortunes after it reported half-year, pre-tax losses of £700 000 and replaced chief executive John Lodge in September.

Project Merlin - ostensibly the fusion and upgrade of Ransys and Risc, Rolfe & Nolan’s current decade-old derivatives applications - was expected to cost in the region of £9 million. But due to financial constraints it was decided to continue the development along modular lines - individual pieces of functionality pulled together by a common architecture - which ironically could prove decisive to organisations who do not want to deploy the entire suite.

“We made no bones about the fact that the development stage needed to be ‘sponsored’ due to the Rolfe & Nolan’s size,” said Freeman. “We did not have financial resources to develop Merlin which meant that we had to raise the cash to do it by finding sponsors for the project.”

The new Merlin modules are being developed to compete with US-based SunGard Trading and Risk Systems’ GMI solution and French-based Ubitrade’s futures and options application.

“In the past, when you wanted Rolfe & Nolan functionality, you had to buy either the Ransys or Risc system and strip out the elements that you didn’t need,” said Freeman. “In future, banks will be able pick and choose the types of applications and functions that they need without having to buy the entire suite.”