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it also brought along a legacy of three different cultures, a staggering array of 1500 retail products, different technology platforms and rising costs. The consolidation efforts from 2002 to 2005 have completely transformed the bank such that Banca Intesa is now rated as Europe’s largest and most successful merger experiences. The bank’s net income rose 55% in 2004, to $2.5 billion, and return on equity hit 12.9%, up from 1.4% in 2002.

“The focus on information technology lies at the core of the bank’s transformation,” says Dr.Romano De Carlo, who currently heads technology at Banca Intesa. In a career spanning forty years, Dr. De Carlo has been the technology head at several leading banks in Italy where he has overseen the technology program and the restructuring of complex organizational units.

Here he talks to research and contributing editor, Rekha Menon, about the bank’s technology strategy, current focus and future plans.

What was the key post-merger technology initiative at Banca Intesa?

The biggest challenge created by the merger was that each of the three banks had their own core banking systems. This led to high maintenance costs, unnecessary duplication of activities and lack of communication between the three banks. It was therefore essential to create an integrated technology platform across Banca Intesa. Keeping the high transaction volumes and costs in view, we decided to use the existing in-house developed core system at Banco Ambrosiano Veneto.

It was a strategic decision since we felt that this would help us retain information system knowledge within the organization. The core technology system at Banco Ambrosiano Veneto was enhanced and then it replaced the existing solutions at the other two.

What was the impact of the technology integration exercise?

Putting together a single technology platform that replaced existing systems and is now serving the bank’s entire network has been one of the most critical projects for the bank in recent years. The entire migration exercise took 3 years. There is a single core-banking platform with three modules - private banking, retail banking and corporate banking. This reflects the new organizational structure at the bank.

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