A new technology division is being launched at Germany’s Deutsche Bank to restructure systems for simplicity and efficiency, Reuters reported on Monday (Oct. 7).
The bank’s legacy IT procedures have been deemed responsible for runaway expenses and falling behind advancing FinTech development. The lender said it would earmark $14.2 billion for technology by 2022.
The central technology division will be headed by Bernd Leukert, who will be charged with managing tech security, data and innovation.
“At its heart, our technology strategy empowers our businesses to control ‘what’ is produced, while technology has control of the ‘how’. In the past, the ‘how’ offered too much optionality and did not consistently follow group-wide architecture and tooling,” said an employee memo seen by the news outlet.
The bank said in its staff memo that moving operations to a cloud-based platform would take time.
“We have a bank-wide commitment to strengthen engineering expertise in the bank by increasing the share of expert internal technology staff,” it said.
The new technology division comes on the heels of a U.S. congressional investigation that found possible failures in Deutsche Bank AG’s money-laundering controls.
The bank handed over numerous transaction records, emails and other documents, and investigators discovered instances in which staff noted concerns about new and existing Russian clients — only to be ignored by managers.
The investigation, which is also looking into whether the lender acted as a correspondent bank to facilitate the movement of illegal funds into the United States, is in the early stages.
In 2017, Deutsche Bank agreed to pay regulators in the U.S. and the U.K. $630 million in fines for organizing $10 billion in fraudulent trades that might have been used to launder money out of Russia.
In addition to this investigation, the House has also started looking into possible money laundering in U.S. property deals involving President Donald Trump, as well as whether Trump’s dealings subjected him to the influence of foreign individuals or governments. As Trump’s biggest lender, Deutsche Bank is also a part of that inquiry and submitted documents to investigators after receiving a subpoena.