Nationwide has pledged to continue to invest in the replacement of core legacy systems to deliver an “integrated” banking platform.
This investment strategy forms part of the building society’s £300 million Voyager business transformation programme, which Nationwide said in its latest preliminary results announcement is part of its “commitment to cost efficiency and customer service”. Under Voyager, the building society is working with SAP, IBM, Capgemini and KPMG to implement a new SAP banking technology platform switching to a SAP banking technology platform
The building society reported profit before tax of £341 million in the year to 4 April 2010, up 79 percent from the previous year (£190 million).
However, its underlying profit was £212 million, a 46 percent fall from £393 million in 2009, which the building society said was achieved “despite difficult trading conditions, low interest rates and margin compression”.
Graham Beale, Nationwide’s chief executive, described the building society’s results as “particularly pleasing”, given the challenging economic environment.
So far this year, the building society has introduced a new point of sale mortgage system, a new work flow management system and increased its participation in the Faster Payments Scheme, which allows immediate transfer of money to other banks.
Nationwide also said that it had recorded an “improving” trend in the group telephony and internet distribution channels, which support its products.
Although it said it had increased lead generation through its call centre by 73 percent compared to 2008/09, lower call volumes resulted in the closure of a Swansea-based call centre last November, with the closure of a call centre in Bournemouth scheduled for next month. These closures delivered £5.8 million cost savings to the telephony division.
Meanwhile, Nationwide reported a “strong” internet sales performance, which it said was helped by the online managed account transfer process it launched in April 2009. It also launched a new e-ISA in February 2010.
Earlier this year, Nationwide said it was working on a project to virtualise 500 servers in its datacentre, with the aim of cutting £8 million from operational and energy costs.