Responding to banks' desire to improve operational efficiency and to benefit from recent advances in mobile and internet technologies, IBM (Armonk, N.Y.) announced details of several major deals in the financial services industry, from across Central and Eastern Europe (CEE) and with a combined value of more than $130 million (USD). The banks include Sberbank in Russia, PKO Bank Polski in Poland, Erste & Steiermarkische Bank in Croatia, PRAVEX-BANK in Ukraine, Garanti Bank in Turkey, JSC Rietumu Banka in Latvia, Societe Generale in Serbia, NovaLjubljanska Banka in Slovenia and Raiffeisen Bank in Romania and Czech Republic.
IBM will provide new hardware, software and services to support efforts by the banks to modernize their core banking systems to prepare for growth, increase efficiencies and take advantage of new market opportunities.
"The global banking crisis has served as a catalyst for a drive towards greater efficiency and the need to differentiate," said Eray Yuksek, Director of Financial Services Industries, IBM CEE, in a press release. "We are seeing the effects of this in the financial services sector today as leading banks are … investing in IT to improve the management of information -- helping to create customer-centric services and ensuring the highest possible standards in risk management."
The initiatives include the following:
Russia: IBM helped design and launch a new software architecture for the country's largest lender, Sberbank, to integrate the bank's IT infrastructure. According to IBM, the new system enables faster decision-making and more efficient management of financial data. The total value of the contract via selected business partners is in the region of $25 million (USD). The solution -- based on more than 20 IBM Power servers -- enables Sberbank to integrate more than 80 different systems across all Russian regions, covering nine time zones.
Poland: The country's oldest and largest bank, PKO Bank Polski, signed an agreement for IBM to provide four of the latest IBM zEnterprise mainframe servers to improve the performance and efficiency of the bank's systems and improve customer service. IBM also provided software to help better integrate critical business processes and improve the management of financial and customer data.
Croatia: Erste & Steiermarkische Bank (Erste Bank), the third-largest bank in the country, migrated its core banking system to IBM technologies to reduce maintenance costs and ease the development of new financial services, the vendor reported. With the new system, Erste Bank has lowered the time needed for batch processes and improved the performance of online processes.
Romania: Raiffeisen Bank selected IBM to provide a new IT infrastructure as part of an effort by the bank to increase competitive advantage and improve customer service. The new Enterprise Content Management platform will allow Raiffeisen to rethink business processes and improve operational efficiency. IBM will provide IBM hardware, software, and consultancy and services for the implementation, integration and maintenance of the new system. In another project with Raiffeisen Bank in the Czech Republic, IBM provided a new core banking system and services to maintain the system over five years.
Slovenia: NovaLjubljanska Banka (NLB), the country's largest bank, turned to IBM to help improve the performance of its IT systems in order to better manage data and provide timely and accurate financial reports to the European Central Bank. IBM provided the bank with a new zEnterprise mainframe server, as well as business analytics software, to speed up the processing times of financial data. Complex queries that previously had taken up to one to one-and-a-half hours to complete will instead be processed in seconds, according to IBM, which also will provide technology services to design and implement the new system.
Latvia: JSC Rietumu Banka migrated its mobile banking systems to an IBM workload optimized system. The bank has improved database performance by 300 percent, boosted data availability by 200 percent, and lowered administration costs more than 20 percent, according to IBM.
Ukraine: IBM signed a five-year agreement with PRAVEX-BANK to provide technology and facility management services for a new data center based in Kiev. The new system will enable PRAVEX-BANK to automate its banking processes, improve service for more than 1 million customers, and support the rollout of online and mobile banking services. The bank is one of the first in Ukraine to comply with the National Bank of Ukraine's (NBU) directive for banks to host customer data within Ukraine and ensure the highest levels of business continuity on the market.
Turkey: Garanti Bank selected IBM System z mainframe servers as the foundation of its banking infrastructure. The increased performance of the new system is expected to help Garanti Bank provide banking services to more than 950,000 customers across the country and process more than 200 million transactions a day, IBM says.
Serbia: IBM signed an agreement with Societe Generale to provide a new smarter computing solution to help the bank to simplify business processes, improve customer satisfaction and decrease the time to market for new products and services.
"In 2011 there has been a resumption of IT spending in the financial services sector across growth markets," said Alex Kwiatkowski, Banking Research Manager IDC-Financial Insights EMEA, commenting on the deals in a press release. "This is not only driven by the need to reduce IT running costs and architectural complexity, but the desire to significantly improve the overall customer experience with better integrated digital channels. While foreign ownership has created an inextricable link between many CEE institutions and the Western European banking sector, it is encouraging to see this has not acted as a major impediment to operational and technological investment in the last 12 months."
Katherine Burger is Editorial Director of Bank Systems & Technology and Insurance & Technology, members of UBM TechWeb's InformationWeek Financial Services. She assumed leadership of Bank Systems & Technology in 2003 and of Insurance & Technology in 1991. In addition to ... View Full Bio