Australian Financial Review Report: “Westpac Jumps on (CSC) Platform”
Julian Bajkowski - AFR/Fairfax Syndication
According to an article in the 11 May 2011 issue of the Australian Financial Review, Westpac Banking Corporation has spoken publicly about its decision to adopt CSC’s Celeriti banking platform.
Westpac Jumps on Platform
Westpac Banking Corporation has publicly thrown its weight behind a revamped version of Computer Sciences Corporation's "Hogan" core banking platform dubbed Celeriti, in a sign that it will move to the new product as part of a systems renewal project worth more than $2 billion.
Officially launched on Monday, CSC is betting that Hogan will allow it to protect its substantial market share in the global financial services sector by offering existing customers what it claims are similar capabilities to rival banking plays by software juggernauts SAP and Oracle for a fraction of the price of competing replacement products.
Westpac had previously said that it planned to deploy a slightly newer version of Hogan that is now in use by its St George subsidiary to replace the main bank's internally developed core banking system by 2013, two years later than it initially flagged to the markets.
"We support CSC's Celeriti product as it advances our core banking solution and allows us to implement our multi-brand strategy without the challenges of a rip and replace approach," Westpac chief information officer Bob McKinnon told The Australian Financial Review.
"The transition to Celeriti will result in minimal customer impact with lower cost and risk. It offers Westpac's customers a better solution than all other alternatives." While Westpac has still not nominated a date for Celeriti to go live, the in-principle commitment has opened the door for CSC's other big local Hogan customer, Australia and New Zealand Banking Group, to start preparing for its own core banking upgrade to keep up with its peers.
Over recent months, both Westpac and ANZ have been fighting a rear-guard action to convince institutional investors that they have future technology strategies to compete with respective billion-dollar investments in new core banking capabilities by the Commonwealth Bank of Australia and National Australia Bank.
Analysts have estimated that the CBA could extract a competitive lead of up to five years through the deployment of its new core banking system, most of which is already operational.
The level of investment and speed of progress in adopting more modern transactional systems has also attracted the attention of regulators including the Reserve Bank of Australia, which is now examining the state of competition and levels of innovation in the Australian payments system.
A likely driver for Westpac's support for Celeriti is that the product has been developed to dovetail with several software and hardware products from its outsourcer, IBM. The bank renewed its services deal with IBM in November last year in a deal worth $1.3 billion.
Article is © 2011 FairFax Media Management. Used by permission.
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