Allied Irish Bank outsources up to 450 IT jobs

Allied Irish Bank (AIB) is planning to outsource IT with about 450 roles potentially affected as suppliers – including Indian provider Wipro – take over services

Allied Irish Bank (AIB) is planning to outsource IT with about 450 roles potentially affected as suppliers – including Indian provider Wipro – take over services

The bank is expected to inform staff and unions today (13 January 2015), according to the Irish Times.

“There is an ongoing review of IT services at the bank. AIB has always adopted a partnership approach with its employees and their representatives when managing change. The review is being carried out in full consultation with the unions,’’ said an AIB statement.

The Irish Bank Officials Association – the union that represents the workers – said it was extremely disappointed that roles are being outsourced.

At the time of writing there were no further details, but reports suggest communications provider Eircom, IT security consultancy Integrity Solutions and Indian IT giant Wipro – which has a delivery centre in Ireland – are in line for contracts.

Banks outsource to transform

Outsourcing IT is seen as a way to cut costs and give banks the IT skills to transform operations. Banks are increasingly using modern technologies such as cloud, mobile and automation software to increase efficiency and engage customers in new channels.

In March 2014 the Bank of Ireland outsourced its technology operation to Accenture, which affected 200 staff.

The bank said it was working with Accenture to help it “deliver on customer needs and expectations now and into the future”.

Shift in finance IT jobs

Recent research suggests banks are increasingly turning to suppliers for IT services. According to figures from accountancy company Nixon Williams, the number of jobs in the financial services sector has declined 16% since 2009, while the number of staff employed by IT firms has increased 13.9% – partly because banks are using more outsourced IT.

Financial services companies are using more third-party IT products and services as well as outsourced IT, which has boosted the number of workers in the IT sector, while the workforce in finance has reduced.

But banks need to ensure their IT services partners have the right skills, experience and technology in place because, if problems occur, it is the bank that will be punished by the regulator. UK regulators recently fined RBS £56m in relation to an IT failure caused by a mistake made at an offshore IT centre in India.

A senior IT professional in the UK banking sector said the large scale of offshore outsourcing is worrying. “I think outages will be the least of our worries. Security breaches will be the next big issue. The bad guys are smarter and better funded than the good guys, and they only need to win once to cause chaos."

Read more on IT for financial services

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