The UK's banking sector is going through a seismic change as two of the UK's biggest banks get ready to sell-off parts of their businesses.
The government-owned Royal Bank of Scotland (RBS) and Lloyds TSB groups are putting hundreds of high-street branches and financial services business up for sale.
The move will clear space for three new high-street banks within four or five years. Companies such as Tesco, which has announced its plans to launch a bank Virgin which already has a finance arm, and Spanish bank BBVA, are among the possible acquirers.
The new banks will have an opportunity to differentiate themselves with innovative IT. They will be able to start again with blank sheet, without being held back by their existing legacy IT systems.
Commentators believe that the new entrants will replace large traditional IT departments with outsourcing IT support. And they will invest heavily in social media to reach customers - an area neglected by the traditional banks.
Peter Brudenall, lawyer at Hunton & Williams and outsourcing specialist, says that banks elsewhere in the world are outsourcing significant parts of their IT infrastructure. "There are banks in the Middle East that are only a few years old that outsource about 80% of their IT and are almost virtual banks," he says.
http://www.computerweekly.com/Articles/2009/11/06/238450/how-will-the-uks-new-banks-look.htm