From the FT, “Deutsche Bank to rip out IT systems blamed for problems”,
In discussions with colleagues, John Cryan has expressed alarm about the “Horlicks”, or total mess, the bank has made of its technology by allowing individual teams and traders to operate on their own incompatible platforms.
His emphasis reflects the challenge confronting many big banks as they scramble to modernise IT systems, in the face of mounting pressure from regulators, digital challengers and cyber criminals.
Kim Hammonds, who Deutsche hired from Boeing two years ago as its chief information officer, has told colleagues that its IT systems operate by trial and error — an approach akin to her former employer sending aircraft into the sky, watching them crash, and then trying to learn from the mistakes.
Deutsche now has, for example, more than 100 different booking systems for trades in London alone, and has no common client identifiers. It has even been unable to retrieve some of the data requested by regulators — which contributed to its failure in this year’s US bank stress tests.
Many banks are short of technology expertise in their boardrooms. A new survey by Accenture found that almost half of the world’s 109 biggest banks have no board members with any technology experience and a further quarter of them have only one such director. The study found that only 6 per cent of bank board members have technology experience.
Here is a video on “Banks Are Obsolete & Will Not Exist As We Know Them In 10 Years“. Until then, this is a positive step.