IBM signed the contract for $1.6 billion with the largest retail bank of Britain

In March, 2017 the Lloyds Banking Group retail bank, largest in Great Britain, signed the IT contract with IBM corporation. The agreement assumes outsourcing of service of computer systems and transition to the American contractor of nearly two thousand staff of financial conglomerate.

The cost of the contract signed for seven years is 1.3 billion pounds sterling (nearly $1.6 billion). At the expense of it in Lloyds Banking hope to cut down expenses on 760 million pounds sterling and to make the company more flexible and capable to react to development of new technologies.

Bank department of Lloyds Banking

According to the Financial Times edition with reference to labor union Lloyds Trade Union (LTU) which, in turn, refers to the Chief information officer of Lloyds Banking Morteza Mahjour the company will transfer to IBM of 1961 employee, the majority of which work in the British data centers of bank. With these employees the contract for one year is signed, however most of them will be able to work within four years. During this time workers will be replaced with cheaper foreign labor power.

According to LTU, the transaction with IBM was criticized from senior managers and IT heads who are afraid that the crucial systems which are the cornerstone of the main payment services, cash transactions, settlement service and digital services are transferred to an autsoring to the third party and will be controlled finally from abroad.

The bank recognizes that transfer of these 20 million clients to the private cloud managed abroad can weaken the existing security measures and have an adverse effect on confidentiality and integrity of bank information, says LTU.

Lloyds Banking did not begin to comment on this information on a request of media and only noted that the company considers different options of use of cloud computing.^[1]

Notes