The Commonwealth Bank of Australia today said it would merge BankWest's technology platforms with its own as part of its planned $2.1 billion acquisition of the Western Australian bank.
"The BankWest integration will be aligned with and incorporated into our overall CBM [core banking modernisation] program," a CBA spokesperson told ZDNet.com.au. "We expect substantial system synergies upon alignment."
CBA listed streamlined support functions and a merged technology platform with its $580 million core banking replacement project as among the synergies to result from the deal, announced this morning.
The bank estimated the cost of integrating BankWest, including technology, transition and restructuring, at $330 million, with $220 million a year to eventually be shaved off its annual costs, including technology spending.
The 2007 financial year saw CBA spending $826 million on technology, which was around 12 per cent of its $7 billion operational costs.
The bank has not stated whether IT staff will be affected by the merger; however, it did outline BankWest's higher operation costs compared to its own.
The spokesperson said while it was too early to go into details of the IT integration, the bank expected the overall operating model to be developed over the coming months. They did not directly address a question about changes in IT staff headcount.
The merger will more than double the number of ATMs CBA has in Western Australia, with BankWest adding around 360 ATMs to CBA's existing network of 275 in Western Australia. An extra 5,000 staff will come with the acquisition, along with 148 retail branches and 28 business banking centres.
The future of the joint venture between Unisys and BankWest Unysis West could also be affected by the acquisition. The two companies had already been considering shutting the joint venture down, with BankWest planning to take its IT services back in-house.
Sounds like another moneyspinner for Accenture and SAP.
Accenture will now demand more fees for adding BankWest into the core system replacement project. This will be a great way to make up any margin slippage or losses they are experiencing on the current project which the industry knows is not going very well.
The real question is: will negotiations for Accenture to get their hands on more Commbank shareholder money be led by Commbank Director Jane Hemstritch? Hemstritch holds tens of millions of shares in Accenture and has a massive conflict of interest in spending Commbank shareholder money on Accenture which helps Accenture make more profits and fill her already overlfowing bank account.
Why doesn't the Commbank chairman want to talk about this conflict of interest when shareholders ask about it? Where are the regulators? How do they think Accenture partners are able to buy $15 million dollar homes in Mosman (check out this shack, owned by the head of Accenture's banking group: http://www.rwlns.com/cgi-bin/clients/rwhneu/profile_css2.cgi?clientid=rwhneu&cat=sales&propertyid=2023405)Â