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Banking without the waiting
Sagicor Bank Jamaica accelerates its core processes and positions itself to launch new services with IBM LinuxONE technology
Standing in line is rarely fun. And while mobile apps and online portals have reduced our need to queue up to speak to a bank teller, in Jamaica, plenty of banking operations still occur in person. But what if there were a bank that prioritized its customers’ time? That made banking less of a chore?
“Like all financial entities, we’re participating in a very competitive landscape,” explains Mark Clarke, Vice President of IT for Sagicor Bank Jamaica. “So we’re always seeking opportunities to differentiate ourselves and to increase the value we deliver to our customers. But to move forward with any of these value layers that we want to add, we need to have the right technology in place.”
In particular, Sagicor wanted to update its core banking application. For nearly a decade, the organization had relied on an instance of the Temenos core banking solution from IBM Business Partner Temenos AG. But while new versions of the software came out each year, Sagicor had stayed with its initial release.
“We were still using their R14 series,” adds Clarke, “which of course works very well and has served us without complaint. But we deployed that technology long before anyone was talking about containerization or multicloud or so on. And it was critical that we invested in and moved to a technology that not only allowed us to optimize our core banking but that will help us move forward on our digital transformation and pivot to cloud.”
At the same time, the underlying hardware infrastructure was equally aged and taking too long for common tasks. End of day closing routinely required more than six hours to complete, meaning that sometimes the bank would open its offices in the morning while the previous day’s closings were still being finalized, causing early operations to behave sluggishly.
“As a bank customer, it’s incredibly annoying to start your day standing in line for a long time just to post a deposit,” adds Clarke. “And the worst thing about it is that the teller can’t do anything. They’re stuck waiting for the technology to do its job. So queues back up, and customers get more frustrated. It’s not ideal.”
Reduced Execution Time
Shortens end of day closing by roughly 50% now taking <3 hours to complte what previously required >6 hours
Cost Savings
Cuts annual costs by an estimated USD 1 million achieving a full ROI in 3-4 years
Confident in its choice of Temenos for its banking technology, Sagicor began evaluating new hardware to host its updated banking environment, quickly focusing on IBM technology.
“I consider IBM to be our trusted source provider,” notes Clarke. “When I’m thinking about strategy, IBM is one of my first calls. They spend the time and energy to understand my needs. And they sit down and talk with us and show us what is happening in the larger market and how they can assist us. They’re not just pushing products.”
Enrique O’Reilly, Regional Director at Temenos for Latin America and the Caribbean, adds: “I’ve heard many people compare changing or upgrading a bank core to open heart surgery. It tends to be very complicated. You need security. You need flexibility and data integrity. You need scalability—especially if you’re looking at tens of thousands, or hundreds of thousands of transactions. And while Temenos is platform agnostic, we’ve seen IBM deliver that level of performance again and again.”
After some initial discussions, the IBM team proposed a proof of concept (POC) that involved a lone IBM® LinuxONE server, running Red Hat® Enterprise Linux® (link resides outside of ibm.com), that was deployed at Sagicor’s main office.
“They told us, ‘Don’t take our word for it—we’re going to prove it to you,’” recalls Clarke. “They shipped us a prototype at no cost to us, and then they configured and optimized a setup of Temenos Transact. We essentially ran a parallel core banking process on this LinuxONE for a few months—and this POC exceeded every one of our success parameters. It let us easily present a winning business case to our stakeholders and business leaders.”
With management buy-in, Sagicor began coordinating with the IBM team to map out the entire solution, including a recovery environment and accompanying storage. The joint team migrated the already-deployed LinuxONE server to the bank’s recovery site, while installing a new LinuxONE platform within the company’s primary data center to serve as the production environment.
The two systems are taking advantage of open-sourced Kernel-based Virtual Machine (KVM) technology to enable multiple virtual environments across the platforms. Currently the servers are running eight and 18 Integrated Facilities for Linux (IFLs) in the production and recovery environments, respectively. At the same time, IBM and Sagicor deployed a pair of IBM FlashSystem® 7200 storage devices—one at each site—to store the corresponding account data being managed by the updated banking systems.
“The Temenos solution forms the bedrock of a bank’s financial systems,” explains O’Reilly, “so it runs through a lot of data. It lets users oversee and manage their clients, current accounts, investments, the lending treasury—pretty much all their core functionality. If it’s an action being performed for a customer, it’s likely going through Temenos.”
“One of the things that I have been most careful about in speaking with my principals is to explain that we are not dealing with IT ‘costs’ anymore,” notes Clarke. “I’ve been careful to shift their mindset from that word—instead speaking of IT as an ‘investment.’ And now that we’ve invested in Temenos and LinuxONE, we’re leading the industry as we embark on our digital journey.”
In particular, Sagicor is hoping to expand access to its services, providing more digital and mobile banking solutions to consumers. Similarly, AI-powered chatbots could help facilitate faster, around-the-clock service to bank customers.
“The sky’s the limit,” explains Clarke. “I have dreams of how it will be in the future. It’s going to be agile. I envision a world where our customers will no longer need a brick-and-mortar store—where they can access all our services in a virtual space, a financial metaverse if you will. No matter where they are on the globe, their banking experience will be seamless.”
And to facilitate the creation and expansion of these available services, the bank intends to take advantage of the APIs made available by the Temenos platform. “Our architecture offers several built-in APIs that will allow Sagicor to integrate to different platforms not only inside the business but also outside,” clarifies O’Reilly. “So it will be able to combine and create other tools—payment initiation tools, analytics tools, whatever they want.”
Clarke continues: “We’ll be able to introduce new revenue streams—new business models—that’s a big plus for us. And as we take the next steps—which is the transition to multicloud hybrid—LinuxONE will be ready to handle that.”
Sagicor (link resides outside of ibm.com) is a leading, full-service financial institution that operates through 16 branch offices located throughout Jamaica. The company, headquartered in Kingston, Jamaica, is part of Sagicor Group Jamaica—a financial services conglomerate that specializes in life and health insurance offerings.
IBM Business Partner Temenos (link resides outside of ibm.com) is a software developer and distributor whose flagship solution is a leading, open platform for composable banking that creates opportunities for over 1.2 billion people around the world every day. Temenos serves over 3,000 banks in more than 150 countries, helping them build new banking services and state-of-the-art customer experiences.
Footnotes
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Produced in United States, January 2023.
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