Decommissioning Banks

1. Problem

Financial crisis, the zero-rate policy, and ever-more strict regulations pose many a challenge to banks, and private banks that cannot keep up with compliance requirements are sold or settled with rescue companies. In the aftermath, it doesn’t matter whether or not business is terminated – all customer data has to be preserved for ten or more years.

As is typical for banks, this data is dispersed over numerous systems. Some of them are customized solutions, others are commercial e-mail solutions or document management systems, and some even are audio archives where recording of discussions with customers are stored. All of them have to remain live to guarantee access to legacy data and documents.

2. Consequences

Continuous access to customer data is necessary for two reasons: on the one hand, local and international lawyers or tax authorities have the right to ask for insight into banking data. On the other hand, former customers have the same right in the instance that, for example, they would need account statements for their tax returns.

Even though the number of these requests is limited, the entire acquired IT landscape has to be operated, maintained, retrofitted, and sometimes even licensed, all of which is typically very costly.

New regulations mandating the deletion of data make things even more complicated. Since May 25th of 2018, the European General Data Protection Regulation (EU GDPR) requires companies to be able to delete individual data precisely and purposefully.

Many legacy systems cannot even be retrofitted to comply with this GDPR requirement. Others can, but only by investing a lot of time and effort. Either way, it would be tied to high costs for companies.

3. Impact

The continued operation of legacy systems is often the reason why companies spend 80 percent of their IT budget solely on operation. This is also true for banks. Furthermore, the acquired systems are also a compliance and security liability if they cannot be patched or updated regularly.

Migrating legacy data is not a sustainable solution either. Such a migration project is tied to high costs because of its technological complexity. Even if that weren’t the case, there would still be another problem. Migrating data and documents usually means changing their structure, which means internal or external auditors would not be able to authenticate the migrated information anymore. Consequently, companies would still have to continue to operate legacy systems and retrofit them for regulations like the EU GDPR.

4. Solution

The solution to this problem is the decommissioning of legacy systems (also: application retirement). For successful application retirement, all information, data, and documents have to be migrated to a neutral and central platform and be stored in a modern data format. This is not to be confused with simple archiving, however. Neither users nor internal or external auditors access table elements, but rather search for e.g. all account statements of a customer in a specific time period, or a recording of a consultation preceding the closing of a specific contract. Therefore, the information has to be stored with its corresponding business context and be encrypted, if necessary. This concept is called historization.

Such a platform not only offers interfaces to various legacy systems from different manufacturers like Baan, Microsoft, Oracle, SAP, Peoplesoft, and so on, but also to specific banking applications. All information in legacy systems is extracted and migrated, every step of the way is meticulously documented. Data and documents can be deleted precisely and purposefully. Access rights can be defined easily. Of course, such a platform complies with audit requirements and is also certified by auditors.

This modern central Information Management Platform is called JiVS IMP and manages the entire lifecycle of legacy information, data and documents. It stores information from legacy systems and manages their lifecycle according to internal and external regulations, like the EU-GDPR. JiVS IMP takes care of the data transfer from legacy systems, the documented deletion, and everything in between. Sensitive data can be encrypted.

Data Migration Services has taken things a step further and developed a solution specifically for banks: JiVS Banking Edition. Among other things, it allows users to process legal and customer requests, and once they find what they were looking for, they can make the information available to the requesting parties electronically or as printed documents.

5. Benefits for Customers

With JiVS IMP Banking Edition, bank rescue companies can easily decommission the acquired legacy systems. The solution not only guarantees legal certainty and compliance, but also reduces operational costs by 80 percent or more compared to the continued operation of legacy systems.

JiVS IMP can be beneficial in other areas as well, like data migration or retention management.

6. Price and Availability

JiVS IMP and the Banking addition are generally available. Functional scope and price will be determined on a project-per-project basis.

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