Kim Hammonds, CIO is to lead a major restructure of technology at Deutsche Bank which will see the organisation lose 9000 staff as its CEO admits the German bank has “outdated” IT.
John Cryan, Co-Chief Executive Officer of Deutsche Bank put IT modernisation as one of the key strategic goals to make the German bank simpler and more efficient.
Announcing Strategy 2020 as the bank, which is a major employer in London, Cryan said the bank would “become less risky by modernising our outdated and fragmented technology and withdrawing from higher-risk relationships and locations”, the first time a major bank has admitted that legacy IT and poor technology strategy is equally as risky as its financial lending strategy.
Cryan announced the new strategy alongside the revelation of a third-quarter loss of €6 billion at the bank and the news that it was withdrawing from the economies of Argentina, Chile, Mexico, Peru, Uruguay, Denmark, Finland, Norway, Malta, and New Zealand.
“About 80% of our 7,000 applications were outsourced to a multitude of vendors, design was basically done in silos and joint standards either hardly used or not used at all,” Crayn said at a press conference, first reported by Banking Technology. “The result is that our systems do not work together, they are cumbersome and often incompatible.”
Crayn went on to admit that close to a quarter of its datacentre technology was beyond the end of its lifecycle.
Kim Hammonds, promoted to COO just a week ago will lead the modernisation and transformation at Deutsche Bank. Hammonds joined the London based bank two years ago from aircraft manufacturer Boeing and has already had to manage major job losses in time at Deutsche Bank.
Reports suggest that Deutsche Bank will rationalise 45 operational platforms to just four and will increase its use of private cloud and virtualisation to reduce operational expenditure. The bank will be investing in new customer profiling and Anti-Money Laundering technology with the savings.