Lloyds Banking Group is to splash £3bn on IT investment, amid a major outsourcing and cost-cutting programme.
In a trading update, the Halifax, Lloyds Bank and Bank of Scotland brands owner revealed its "business transformation" budget had increased 40 per cent on the previous year. It also reported bumper pre-tax profit for 2017 was £5.3bn, 24 per cent higher than a year earlier.
Lloyds said it intends to "deploy new technology to drive additional operational efficiencies that will make banking simple and easier for customers whilst reducing operating costs."
Lloyds finally inks mega 10-year cloudy outsourcing deal with IBMREAD MORE
Last year, the group inked a 10-year outsourcing deal with IBM, with 1,500 staff and contractors to be transferred over, as first revealed by The Register. Under the deal, it plans to shift its core infrastructure to the cloud over a three year period.
According to Bloomberg, earlier this month the bank said it is planning to slash 1,000 jobs ahead of the "transformation plan" – with around 250 reported to come from IT.
Lloyds said the £3bn would be used to create a "digitised" bank, with a simplified "and progressive modernisation of our data and IT infrastructure." The Register has asked for more information, including how it aligns with the outsourcing and cost-cutting plans.
Peter Roe, analyst at TechMarketView, noted that shareholders should demand better disclosure and governance as to how technology is used, and how their money is spent.
“We can but hope that the Lloyds Banking Group management will henceforth set new standards, not only in the quality of IT investment decisions they make, but also in how they communicate them to their shareholders.”
Like most large banks, Lloyds has been hit by a number of IT issues. Last month a DDoS campaign affected customer log-in services intermittently at the banking group. In 2017, it also suffered a series of glitches. ®