ANZ tech reform gets going under renewed scrutiny
- 06 April, 2010 22:00
Australia and New Zealand Banking Group has quietly kicked off an internal review of its $768 million-a-year technology operations in Australia and Asia, just two weeks after the arrival of its new chief information officer, Anne Weatherston, from the Bank of Ireland. The bank is looking at how to structure its technology purchasing to underpin wider operations over the next few years, including the role of its Bangalore-based software factory that employs about 4000 people.
Software, hardware and services suppliers are carefully monitoring Weatherston's moves because the parachuting of an international technology leader into an Australian bank usually precedes significant changes to technology procurement.
A key area of interest is whether ANZ will retain the Hogan core banking system, owned by US outsourcer CSC, which Westpac Banking Corporation has indicated it will adopt following its merger with St George Bank.
Announced in November 2009, Weatherston's appointment has led to a shake-up of ANZ's organisational structure.
A dedicated technology division has been created, reporting directly to chief executive Mike Smith.
A spokesman for ANZ said in early March Weatherston had spent her time in Australia meeting with the bank's management board and had visited local and international technology operations.
"Anne has not been taking meetings with any technology vendors but expects to meet with all suppliers in due course," the spokesman said.
ANZ's technology division came under renewed scrutiny in March and was forced to refute a report. It was claimed the bank had disclosed its IT budget had exploded by $157 million in just four months in a trading update.
An ANZ spokesman said the bank had not disclosed details of its latest IT expenditure to the market in its trading update and that the figures had been pulled from an ANZ annual report.
"The article contains several errors including even the period which the trading update covered," the ANZ spokesman said.
Analysts have told The Australian Financial Review they believe executive reporting lines announced in November will be largely retained, but that ANZ is poised to more aggressively launch new online retail banking products and services - particularly regarding payments and mobile applications.
Deposit accounts, which are linked to online banking and debit card products, have become a key battleground for the Big Four banks as they scramble to boost their cash holdings following a collapse in the availability of cheap wholesale funding.
Once seen as the lower end of the banking market, debit card products have regained favour with the major banks over the past 18 months because they use money customers already have rather than brokering credit products on their behalf.
In late February, ANZ launched a new debit card for business banking customers, a move that counters the Commonwealth Bank of Australia's efforts to woo small businesses by offering services such as secure online transaction hosting in return for settlement.
The new debit card will be pushed heavily through an advertising blitz.
At the same time, ANZ has bolstered its so-called "skunk works" innovation unit, headed by former tech chief Peter Dalton. The unit is understood to be charged with the rapid prototyping of new products and services so they can be brought to market far more quickly.
ANZ has so far refused to detail what sort of funding is available to the innovation unit. MIS Australia