ABN AMRO completes major €1.8bn IT deal

Five IT service providers signed up

Multinational bank ABN AMRO has announced a several global IT deals totalling approximately €1.8bn over five years, with five separate IT service providers.

IBM has been selected to provide IT infrastructure, Infosys and Tata Consultancy Services (TCS) will do application support and enhancements, while Accenture, IBM, Infosys, Patni and TCS will all handle application development.

The bank says the deal is intended to accelerate its Group Shared Services (GSS) programme, which is expected to generate annual savings of at least €258m by 2007.

Combined with expected savings from other GSS-related initiatives, the IT savings are expected to reach a total of €600m from 2007 onwards.

'This major IT initiative enables us to deliver the "fuel for growth" to support the required sustainable competitive growth for the bank,' said Hugh Scott-Barrett, the bank's chief operating officer, in a statement.

'The agreements with selected vendors allow us to utilise the latest technology to further improve the services we offer our clients.'

'We expect that this IT programme that is shared across the group will contribute to the savings in line with earlier estimates made by the bank, while improving IT services within the group,' he said.

The initiative will lead to a new technology organisation of approximately 1,800 staff, compared to a total of approximately 5,000 people currently working in IT within the bank worldwide.

Approximately 2,000 staff will be transferred to the selected IT vendors, of which a majority will go to IBM.

The total estimated IT staff reduction for ABN AMRO will be 1,500 staff over the next 18 months.