NAB racks up IT spending
28 October 2011 | 7195 views | 0
National Australia Bank increased spending by over a half on its IT infrastructure last year as it grappled with a series of breakdowns in its online platforms and poured more cash into a core banking transformation project.
In December 2010, NAB shifted 425 IT jobs to IBM following a major breakdown in its payment processing systems. The bank continued to experience problems into the new year and was hit by another technical failure that affected online banking and payments processing in April.
Delivering its 2011 results on Thursday, NAB revealed that infrastructure spending soared by 56% during the year to A$719 million.
"Most of this investment was made in the group's Next Generation Banking IT platform and convergence of key technology and operational infrastructure," the bank said in its presentation.
Like its peers, NAB is undergoing a painful root-and-branch overhaul of its legacy core banking platforms.
Having opted back in 2008 to install Oracle's i-Flex at the core, the bank says it will eventually commence the roll out of a "foundation release" in 2012. A greenfield implementation of the system is already in operation at its online offshoot UBank.
Alongside the NextGen roll out, NAB initiated a company-wide desktop refresh and network modernisation programme during the course of the past year. It says upgrades to its technology infrastructure and payments systems will remain a priority for 2012.