IBM has clinched a $700 million (£545 million) deal with Spain’s Santander to support the bank’s proclaimed strategic objective of “building the most advanced IT architecture of the financial sector”, the two said this week.
The agreement continues the US company’s run of financial services sector deals, which includes recent agreements with the Bank of the Philippine Islands, BNP Paribas, Westpac, Lloyds Banking Group, Crédit Mutuel, Krungsri, Royal Bank of Canada, and Mizuho Bank. IBM says it has signed $3 billion in cloud deals alone so far this year.
The five-year Santander contract – which IBM said will provide annual savings for the bank on IT spend – will include the addition of AI capabilities to help automate customer support, “enhance branch adviser expertise” and boost productivity, as well as the provision of security for mobile applications and incident response.
IBM Santander Collaborate on Cloud Competence Centre
The bank is working across a hybrid, multicloud environment and has created its own Cloud Competence Center, IBM said: “IBM is collaborating with the center in the definition of the methodologies and processes to accelerate that transformation journey. Additionally, the bank is using a range of technologies including IBM DevOps solutions and IBM API Connect, aimed to develop, iterate and launch new or upgraded applications and digital services much more rapidly.”
“We think this agreement with IBM represents a great support to our strategy of constant progress, while protecting our investments in technology. IBM’s technology will provide the bank with the flexibility needed to support the constantly evolving business of a bank,” David Chaos, Santander Global CIO said in a release.
Banco Santander is a retail and commercial bank, founded in 1857 and headquartered in Spain. It is the largest bank in the euro zone by market capitalisation. At the end of 2018, Banco Santander had €981 billion in customer funds (deposits and mutual funds), 144 million customers, 13,000 branches and 200,000 employees.
The announcement comes as the bank continues to shake up its approach to retail banking. Late last month the bank said it was closing 140 UK branches in response to “changes in how customers are choosing to carry out their banking.”
It said it was making the decision as the number of transactions carried out via Santander branches fell by 23 percent over the past three years, while transactions via digital channels grew by 99 percent over the same period.