Paris, France
8th March 2004
Case Studies in Core Banking Systems Replacement
Report Published by Celent
In a new study, Celent examines three banks that
have made the decision to replace their most vital information systems.
Celent finds that such projects at large banks cost in excess of € 250
million.
"Large banks who have decided to replace
their core systems remain exceedingly rare. However, there are a
growing number of institutions moving in this direction"
according to Octavio Marenzi,
author of the report.
The report finds that such projects cost in
the hundreds of millions of euros at large institutions and even more,
depending on the current systems architecture and complexity of the
businesses that the bank is involved in. As much as half of the overall
cost savings are not generated by reductions in IT expenses, but
rather through improvements in efficiency in back office operations.
The cost savings generated by such
projects, when done correctly, can represent as much as five to eight
percent of the total operating budget of the bank. This represents a
significant competitive advantage.
The banks feature in this report include:
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Santander is migrating
all of the group’s core systems onto a single platform and then plans to
develop an entirely new Java-based application in-house. The total
IT investment for this project is about € 250 million.
Santander expects to reap savings of about € 250 million
annually. |
 |
Postbank is the
largest retail bank in Germany and has been
working with SAP to create a new core banking system. Postbank anticipates total investments of about € 300 million and is already achieving
annual savings of about € 50 million. |
 |
ABN Amro's Indian subsidiary
selected Infosys as the vendor to phase out an older solution.
Interestingly, ABN Amro has been able to achieve considerable cost
savings in operations, and has also created some innovative additions.
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A Table
of Contents is available online.
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