Commonwealth Bank is generally reckoned to be the market leader when it comes to bank technology deployment in Australia — but it still managed to spend less on many areas of IT over the last six months than before. Here’s where CommBank spends its money on IT services.
According to its newly-released half-year report, CommBank’s overall IT services expenditures from July to December were $628 million. That was down 5 per cent from the previous half, owing mostly to ongoing software amortisation. Despite that, the bank said its overall increase in operating expenses (up 3% to $4914 million) was partly due to “technology-related investments”, though these were “partly offset by continued productivity benefits”.
Here’s where the money got spent (all figures are in millions):
| IT Services | 31 Dec 14 | 30 Jun 14 | 31 Dec 13 |
|---|---|---|---|
| Application maintenance and development | 197 | 204 | 208 |
| Data processing | 89 | 84 | 91 |
| Desktop | 58 | 54 | 47 |
| Communications | 100 | 86 | 103 |
| Amortisation of software assets | 143 | 198 | 130 |
| Software write-offs | 10 | 2 | 68 |
| IT equipment depreciation | 31 | 31 | 31 |
| Total | 628 | 659 | 678 |
Comments
11 responses to “How Commonwealth Bank Spends Its IT Budget”
This doesn’t include their IT R & D budget. From memory it’s quite high – and is one of the reasons it can put downward pressure on the ongoing side of IT costs.
Are you sure? I can clearly see “Application Maintenance and Development” in the 1st line is a big deal.
I think you’re right – and I misread the line. They have one of the highest R & D budgets but one of the lowest on infrastructure and maintenance of any of the banks – globally. Has been that way for years. That figure sitting at about a 3rd of total budget would be about right. I’d love to see the split.
Application refers to software applications, not hardware or infrastructure.
Does that include their costs of outsourcing ?
Outsourced IT is bad.
Bad for local economy, bad for local graduates, bad for a company priding itself on the image of being supportive of all things Australian, which is why you won’t see this breakdown.
I have seen the makeup of IT staff change dramatically over the last 5 years. Try and say anything and you risk being labelled racist, when in fact it’s the hypocritical policy of outsourcing jobs to Indian firms that brings people in that have obviously never worked in an office environment, don’t know how to use a toilet or basin – and we’re meant to keep quiet or else.
Outsourcing does not automatically mean overseas. It just means not within the company. It can still be to Australian based firms meaning it is fine for the local economy and local graduates.
So did they spend $400 Mil on the iOS app? Cos the android app hasn’t had a decent update in over a year.
Android was part of the 10mill software write-offs
From what I can see within the organisation, probably only one quarter of that spend is useful. There are many IT projects that are in state of inertia as noone will take responsibility and in general the business have very little regard or respect for ES.
The good workers in the organisation get frustrated by the many poor ones.
Like all companies.
Been requesting the ability to reorder watchlist stocks in Commsec for years…