Deutsche Bank (DBKGn.DE) has tapped software firm Oracle (ORCL.N) to simplify its information technology systems, enabling Germany’s top lender to cut costs, a Deutsche Bank board member said on Thursday.
Deutsche Bank has spent years modernising its computer systems that have repeatedly caused headaches and which former Chief Executive John Cryan had publicly called “lousy”.
The migration is expected to take three to five years and should help lower Deutsche Bank’s total annual costs to 16.7 billion euros ($19.9 billion) by 2022 from the 19.5 billion it posted in 2020.
In 2021, the bank plans to add 2,000 to 3,000 jobs in technology, data and innovation, said Deutsche Bank Chief Technology Officer Bernd Leukert, who joined from SAP (SAPG.DE) in 2019 and has since been reorganising the bank’s IT systems.
By the end of next year, half of the unit’s staff would be software engineers, up from 30% at the end of 2020, he said at an event this week.
Oracle is planning to transfer platforms of some of Deutsche Bank’s core functions such as payments, trading and risk management to one system, promising smooth operation and regular updates, the two groups said on Thursday.
“We want to reduce the complexity of our technology estate. The goal is to run the bank with around one third of the applications we have today,” Leukert said.
Deutsche declined to comment on how much it was investing in the IT upgrades.
For less critical applications, Deutsche already uses technology from Google (GOOGL.O) and will continue to work with SAP (SAPG.DE) technology.
Oracle is setting up a private cloud for Deutsche Bank, modernising the bank’s technology that must stay on premises for regulatory reasons. Oracle has created clouds for others but Deutsche’s would be its largest to date, Oracle manager Juan Loaiza said.
($1 = 0.8386 euros)