Australia's Westpac is expecting big returns from a $500 million investment in a new cloud computing hub, despite posting flat profits for the full-year 2018.
Westpac announced a full-year net profit of AU$8.1 billion, up one percent from last year's results, on revenue of AU$22 billion, an increase of two percent.
The bank downplayed the small returns by pointing to advances in its cloud computing strategy, which has seen more than 100 applications ported to private and public cloud systems from IBM, Amazon and Microsoft.
Westpac was alone among Australia's Big Four in resisting the urge to rip out and replace its legacy core banking platform, opting instead for an API-led cloud strategy that will result in the gradual replacement of the core with an agile architecture capable of providing all staff with a single view of the customer.
The centrepeice of this strategy is the Customer Service Hub, a full suite of APIs that will eventually be rolled out across the bank's entire portfolio over the next two years, beginning with the mortgage application process.
Presenting the results, Westpac chief Brian Hartzer, says: “Out of a total investment spend of $1.4 billion, we invested more than $800 million in system upgrades, digital transformation, and innovation to support our ambition to be one of the world’s great service companies. Our focus has been on delivering our technology platforms, while simplifying and automating processes to make banking easier for customers. We have already migrated 100 applications onto our cloud infrastructure platforms which are now largely complete. Additionally, we have over 120 APIs in production and another 180 in development."