Offering a first glimpse at its future computing plans, Westpac Banking Corp said yesterday it would pump $338 million into
integrating its information systems with St George Bank's following
its $12.2 billion acquisition of the former rival.
The company also said it expected to finalise a new information
technology strategy by the end of March and that it would begin the
task of consolidating the merged business's major information systems
Work is already under way hooking workers at both banks up to common
email and networks, but the heavy lifting will not start until the end
of the year when Westpac starts integrating its data centres and
customer management software with St George's.
The scheme was outlined in a merger briefing from the bank's chief
transformation officer, Brad Cooper, yesterday, shedding new light on
what is sure to become one of the country's most expensive and closely
watched IT projects over the next two years.
The activity will account for a little over half of the $700 million
that Westpac has said it will cost to execute the acquisition and
integration of St George, and it is also regarded as the most risky
aspect of the banks' marriage.
According to figures published yesterday, the integration will save at
least $29 million a year in information systems and infrastructure
costs as Westpac takes advantage of its stronger buying power.
Additional IT savings are likely to flow from outsourcing and job
Many details of the integration program remain unclear, however, and
Mr Cooper indicated that the bank was working to finalise a new
information technology strategy by the end of March.
In the interim it would continue to focus on recruitment for the
transformation as well as critical projects.
Westpac has already bolstered its information technology and product
teams with a spate of hirings over the past few months, including the
recruitment of a number of senior technology executives from
Commonwealth Bank of Australia.
Westpac's recently appointed chief information officer, Bob McKinnon,
is a former technology boss at the CBA and staff he has hired include
executives who worked on its highly regarded $250 million CommSee
customer software platform.
Changes that have already taken place include a restructure of its
information systems division, which will operate across all banking
and wealth management divisions at the merged company.
According to Mr Cooper's presentation, from April next year Westpac
will start moving its own and St George's staff onto common finance,
human resources and risk management systems. Major information systems
integration would follow from October.
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