Funding giant Santander now has 80% of its computing in the cloud • The Register

Spanish financial giant Santander has migrated 80% of its core banking IT infrastructure to the cloud as part of its $20.8 billion (€20 billion) modernization program, using in-house software created by resident developers.

Readers hoping for a tale of disaster and doom might be deeply disappointed, as the bank appears to have made steady progress over the past year compared to April 2021, when some 60% of its infrastructure was delivered offsite. .

The $48.3 billion (€46.4 billion) revenue financing giant is present in Europe, South America, Asia and North America. It made $3.17 billion (€3.053 billion) of its $8.44 billion (€8.124 billion) attributable profit in the United States last year, it said in its results for the 2021 financial year.

Gravity is the bespoke software used to help the bank switch from the core banking system that handles financial transactions including money transfers, deposits or loans.

Breaking any of these moving parts could have disastrous consequences – just ask TSB, the UK bank, which spun off parent company Lloyds Banking Group’s IT infrastructure in 2018, after being sold to the Spanish banking giant Sabadell Group in 2015. The sale launched a bad-thinking data center migration project that caused hours of downtime for customers and ultimately cost the CEO his job.

Moving to the cloud is supposed to make it easier to deploy new features in hours, not days. Santander says its own work will allow it to update applications more frequently and hopes to cut costs by moving to the cloud, saying the cloud push has reduced the energy consumption of its IT infrastructure by 70%.

The bank uses AWS and Microsoft Azure, as well as its own servers, which means public and private cloud deployments. Other banks around the world are also seizing the digital nettle, including Deutsche Bank, Lloyds Banking Group and SEB in Sweden. Last year, Barclays Bank signed a 10-year agreement with HPE to use its GreenLake platform for hybrid cloud.

The Santander Group has earmarked $20.8 billion (€20 billion) for digital transformation in 2020 to create global platforms and improve customer experience by improving the services they use. Some 3,000 developers were hired in the first year, bringing the total to 16,500.

“Gravity will help transform Santander into a ‘digital native’ company,” said Dirk Marzluf, chief operating officer and technology officer at Banco Santander. “This initiative is an important next step in the bank’s transition to a common technology stack that is used across the group’s footprint.”

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He claimed the company was moving “closer to Santander’s goal of becoming the best open financial services platform.”

The modernization project is expected to be completed by 2024, according to Santander’s original schedule. This also includes the implementation of machine learning and robotics, as well as reengineering processes.

According to Santander CEO Jose Antonio Alvarez, it had 50 million digital customers in the March quarter, up more than 10% from a year earlier and online transactions were up 50%.

Jon C Davies, research director at TechMarketView, said of the project: “The nature of these technology initiatives means that the most difficult elements of cloud migration are likely to remain. Therefore, it is not necessarily simple to predict how long Santander still has to go before its cloud journey is complete.”

So there may be war stories to report before the Santandar project is finished and dusted off. Or maybe not. ®

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