Digital capabilities sees CommBank's IT spend up 15 percent in FY16

The Commonwealth Bank of Australia has reported the ongoing investment it makes in technology drove IT spend for FY16 to AU$1.5 billion.

The Commonwealth Bank of Australia has attributed a 15 percent year on year increase in information technology expenses for the 2016 financial year to higher software amortisation, increased investment spend, volume-driven maintenance, and data processing costs.

Total IT expenses came in at AU$1.5 billion for the full year. Specifically, software amortisation increased by 23 percent to AU$379 million, while application maintenance cost went up 19 percent to AU$511 million. The largest IT expense for the full year was the desktop line item that increased by 30 percent year on year to AU$143 million.

The bank outlined it continued to put emphasis on delivering "fast and simple digital transactions" to its retail customers in 2016. As a result, the bank delivered new features including Instant Banking to allow new-to-bank customers to open an account and transact immediate; click and pay with Photo a Bill; and new online loan approval capabilities.

As a result, during the full year CBA saw an increase in uptake of self-service and digital capabilities. For instance, total digital transactions with the bank increased to 309 million, up from 225 million since December 2013; and the volume of logins on a mobile device reached 75 percent.

Meanwhile, for business customers, the bank said it worked on delivering enhanced business intelligence solutions, such as the continued roll out of Albert Eftpos tablets. The bank boasted there are now 40,000-plus Albert devices in the market.

Overall, the bank reported statutory net profit after tax for the 2016 financial year came in at AU$9.2 billion, up 3 percent year on year; operating income increased 5 percent to AU$24.6 billion; and revenue from ordinary activities came in at AU$44.4 billion, down 2 percent from the previous corresponding period.

"We have pursued a simple, consistent strategy for over a decade now. Continued execution of that strategy, focused on customer satisfaction, innovation and strength, has again driven solid operating performance and balance sheet growth for the Group," chief executive Ian Narev said.

Earlier this month, the company's online banking system suffered a "technical glitch" that prevented customers from logging on to their NetBank and CommBank banking app.

A CBA spokesperson told ZDNet at the time technical issues were to blame for the disruption, something which it is still investigating.

"A technical glitch occurred which resulted in customers being unable to log in to our online banking service," the spokesperson said.

"We are currently embarking on a full investigation to understand the root cause of the issue and the full impact. We regret this incident occurred and we apologise to our customers."

In 2014, then-group executive and chief information officer Michael Harte revealed the company had previously frequently experienced 700 outages per year. However, since the company undertook its AU$580 million modernisation project it was able to reduce that number down to two.

In June CBA was also among a handful of other banks that suffered some issues relating to an Eftpos provider, which prevented customers from paying for their shopping at checkout.

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