LONDON • Standard Chartered said it has almost completed costly technology upgrades required to cope with stricter banking regulations worldwide, freeing it up to focus more on revenue-generating products like digital banking.
The bank spent 60 per cent of its US$1 billion (S$1.39 billion) technology budget on compliance-related systems last year and plans a similar allocation for this year, chief information officer Michael Gorriz said on Sunday. The remainder is for other investments to improve products and services, he said.
The stakes are high for the bank that operates in more than 70 countries and is under investigation by regulators from the US to Hong Kong. When chief executive officer Bill Winters joined Standard Chartered in 2015, he pledged to spend more than US$3 billion over three years to upgrade the bank's technology systems to improve customers' experience and better handle regulatory compliance.
Standard Chartered hired 4,500 people last year for its global information technology and operations function, said Mr Gorriz. A total of 24,000 staff work in the function, more than half of whom are based in India.
The move comes as other global banks pare back staff tasked with detecting wrongdoing. The bank is spending US$200 million annually - a third of the regulation-related IT budget - over two years to boost its financial crime compliance-related programmes, or FCC, Mr Gorriz said. The remaining 40 per cent of the $1 billion annual IT budget will be used to make product improvements and offerings.
Standard Chartered's customers will be able to forgo paperwork when opening a new account in Singapore and India this year, as the bank will connect to the governments' central registry and tap into clients' information for new accounts, Mr Gorriz said.
Governments in both countries are seeking to transform financial services by digitising residents' data, which includes national identification numbers, and allow lenders to access such information with customer consent.
"The main thing is how do you herd your customers, the existing and new ones, into this digital behaviour, because if you offer customers both digital and paper channels, basically you double the cost," he said.