FRANKFURT (Reuters) – Deutsche Bank has invited bids from Microsoft, Google and Amazon to overhaul the German bank’s outdated and fragmented technology networks, people with knowledge of the matter said.
FILE PHOTO: The headquarters of Deutsche Bank in Frankfurt, Germany, July 8, 2019. REUTERS/Kai Pfaffenbach/File Photo
The bank’s approach to the U.S. tech companies, which has not been previously reported, is part of a 13 billion euro ($14.20 billion) technology investment Deutsche has planned up to 2022 as it restructures to recover from years of losses.
Bernd Leukert, who recently joined Deutsche’s board as chief technology officer from software group SAP, is overseeing the initiative.
Deutsche Bank said in a statement: “To help us evaluate our options, we have started a tender process with several cloud providers … we expect to be able to complete the process in the coming months.”
Microsoft and Google declined to comment. Amazon did not respond to a request for comment.
Technology is a challenge for all global banks, but Deutsche Bank has particularly struggled to harmonize its networks in the decades after a rapid global expansion that included the acquisition of Morgan Grenfell in London and Bankers Trust in the United States.
Even some of the bank’s most basic processes are outdated. Some retail customers still get their balances entered into savings books by printers for which spare parts are no longer manufactured.
The three U.S. tech groups set up shop on site at Deutsche Bank in Frankfurt last week to come up with proposals to fix technology and partner on projects across the bank, two of the people said.
That will start a three-month pitch and bidding process following talks earlier this year between Leukert and tech executives in the United States and in Davos.
The bank’s supervisory board recently signed off on plans for a broad tech overhaul.
In an October memo to employees, four executives, including Leukert and Deutsche Bank Chief Executive Christian Sewing, highlighted the priority.
“To succeed, we need to fundamentally shift how we build technology and move to a new way of working,” they wrote.
In addition to helping to streamline and update technology, one idea under consideration is to set up a corporate credit marketplace that Deutsche and the technology company would own, one of the people said. It would be open to companies and other banks as a brokerage for loans.
In the revamp, Deutsche is looking for a partnership that would be bigger in scope than work the tech companies have done for other banks in the past, one of the people with knowledge of the matter said.
But Deutsche is not interested in a joint venture because it would result in overheads, boards and bureaucracy, the person said.
Reporting by Patria Uhlig and Tom Sims; additional reporting by Paresh Dave and Jeffrey Dastin in San…