CIO interview: John Finch, CIO, Bank of England, on the IT behind UK monetary policy

UK monetary forecasts are underpinned by data and analytics from the Bank of England

The decisions taken by the financial and economic wizards whose jobs involve keeping the UK economy on track are underpinned by data and analytics from the Bank of England.

Computer Weekly speaks to the bank's new CIO about the IT challenges and opportunities.

John Finch (pictured) has been CIO of the Bank of England since September 2013. Previously he worked at Experian

“It has been a huge opportunity coming to the Bank of England," he says, "to gain a different set of experiences and meet a different group of people."

The Bank of England is considered a very traditional organisation. From an IT point of view, Finch says it is "conservative from an appetite for risk perspective, which is different to the private sector".

That said, he says the Bank of England has made significant investment in analytics to capture data for making fiscal policy decisions: "Analytics is a major part of what we do. In some cases we capture data that is fed into clever econometric models run by economists. But there are also standard off-the-shelf analytics tools to provide time-series data and trend analysis.

Bank of England's device strategy

Within IT, no one uses their own device at the Bank of England. In fact, the bank runs a locked-down IT environment. 

"There are a set of Bank of England-approved devices, including desktops, high-end econometric workstations, an approved BlackBerry device to connect to the government network, and a limited number of iPads for reading content," says Bank of England CIO John Finch.

He says the bank is building proof of concept applications on the iPad to support secure email. 

“There is no bring your own device [BYOD] for now. I think we will get to a position in the future where people will be able to choose from a set of certified devices," he says.

Finch believes that tablets such as the iPad are more secure than paper. Executives at the Bank of England can sometimes carry around papers for committee meetings. "Having these documents on a tablet device is much more secure than paper, because we can wipe the device remotely," he says.

Although it is entirely possible to use a tablet device for visualising analytics data, Finch says analytics applications are largely PC-based.

"We have some deeply analytical systems that capture data to provide intelligence to the people who look at the bank, the economy, and to make interest rates decisions."

Along with the responsibility for supporting the analytics behind fiscal policy, IT at the Bank of England also covers traditional banking functions such as high-volume transaction systems. It runs the critical national infrastructure for the clearing of intra-bank payments

"The bank is quite active on the exchange markets, the money markets and the guilds markets because it does a lot of the banking for government," he says.

Challenges for IT in banking

Clearing and commercial banks are massive organisations that have grown through acquisitions, with all of the complications of using different suites of systems, and have a diverse and ageing technology stack. 

As a consequence, Finch says a lot of stress is placed on the technology and the banks have huge sets of requirements from their businesses, such as when retail banks release new products

On top of these challenges, he says there is also increasing compliance, legislation and oversight due to the credit meltdown, all of which affect IT.

New government policy, such as the Help to Buy programme for getting people on the property ladder, means banks need a new mortgage product. The mortgage systems have to take into account the new way the deposit threshold is calculated. "These are very difficult [IT] environments for the tech people in the banking industry," says Finch.

Banking, like many industries, relies heavily on legacy systems. "People have never been able to go back and rework their legacy systems," the CIO says, pointing out that the main reason is due to the pace of change. "They are growing and need to focus on new areas."

During the recent Gartner Symposium in Barcelona, one of the hot topics discussed was two-speed IT, where the IT department splits off innovation from core operations. 

A lot of people who work here do the job out of a sense of public duty to create a stable banking system

John Finch, Bank of England

Finch says the Bank of England clearing system is one such core IT system – it must remain 100% available, so there is little room for a Google-like approach to innovating, which encourages free thinking and projects are allowed to fail. 

But he sees an opportunity for innovation in other areas of IT. Finch believes the concept of a digital social enterprise could benefit the Bank of England.

"Now that we have good intranet knowledge management technologies, organisations are starting to coalesce around content," he says. A user could create a document and tag it, and another user can then be alerted, as in a Twitter stream, when the document has been published or updated. "It is kind of like an internal Facebook with a knowledge enterprise tied in with mobility."

For the Bank of England, such a system could enhance records management. "The digital strategy going forward will lay on social distribution of documents where you can tag a document and comment on it," says Finch.

The changing role of the CIO

The role of CIO at the Bank of England is primarily to look after the real-time systems that make up the UK payment's infrastructure. 

"There is an element of the role in making sure these system run well, and that they are secure and protected. The CIO role also covers cyber security to protect commercially sensitive information that the Bank of England holds," says Finch. 

The UK economy could be disrupted if such information were to be leaked before it was officially announced.

Another key aspect of the CIO role is to develop an information and data strategy to determine how the Bank of England will capture data going forward. 

"A hundred years ago people would have captured data manually. But with more information online, and from different sources, the bank [needs to find a way to] make use of this new [digital] data."

For Finch, the most important part of the role is leading and energising the team of 450 permanent IT staff at the Bank of England and developing talent. "As the remit of the bank changes, we want to be in a position to develop and support the business," he says.

"A lot of the folks in my team genuinely want to do the right thing for the good of society and the economy. A lot of people who work here do the job out of a sense of public duty to create a stable banking system. A really critical part of my role as CIO is to be able to provide a great environment for the team to develop their careers," says Finch.

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