Banks Booming Investment for Information Technology

The banks posed the financial information technology (IT) as the source of the future competitive edge, and have increased to a large scale the investment to the IT.

The IT investment includes the development and establishment of the new system suitable for the new business environment as well as the replacement of the existing outmoded system.

Because the on-line transactions through the internet or telephone will continue to grow as time goes by, the expansion of the computation capacity has become the urgent task.

According to the financial sector, the Kookmin Bank formed a budget of 131.2 billion won for the IT investment, which is over two times bigger than last year`s 57.5 billion won, and has pursued to upgrade the financial information technology infrastructure such as the next generation system.

Cho Kun-Chul, the director of the planning team of the information system department, told that ``we have concentrated our efforts to develop the system, through which the customers can have transactions throughout the year without an obstruction.``

The next generation system which the Kookmin Bank has established in order to launch on October, will manage together the customer information such as the profitability, the income level and the disposition of each customer, as well as the bank information to apply the advanced financial techniques such as the internal risk and profit management.

The Housing and Commercial Bank and the Hanvit Bank also have concentrated on developing the next generation system and the customer relationship management (CRM) system, and the security system, by increasing the budge for the IT respectively to 172.8 billion won from 121.7 billion won, and to 150.9 billion won from 99.9 billion won.

The reason why the banks have increased the investment to the financial information technology is that because it is necessary to meet the customers` variegated demands following the expansion of the internet and the development of the information technology. Another reason is to establish the management information system which makes possible the development of new commodity and the operation activity based on the close analysis of the customers` information.

An official of a commercial bank told that ``the quality of the bank service will depend on the establishment of the IT infrastructure.``

Kim Do-Young nirvana1@donga.com