Southeast Europe’s financial sector differentiates with Kyndryl services

Kyndryl helps SEE banks use technology to center solutions and talent around financial innovation
Csaba Izbeki,
Managing Director at Kyndryl Eastern Europe

In recent years, technology and regulatory changes have triggered profound digitalisation and disruption in the European financial services industry. More and more people today are using their cell phones to pay, to trade, and to do all sorts of financial transactions with almost everybody. Hence, established banks fear not only from fewer people visiting their branches, but also from completely new competitors, such as fintech startups or tech platforms, for example. This trend was further accelerated by the pandemic, which forced banks and their clients to communicate even more closely, directly and digitally using different business models, channels and apps.

As a result, the number of digital banking users has increased significantly in the last years. Online banking has become the norm in Europe. In Norway, for example, 96% of the population accesses banking services online, while the use of physical cash is declining – more notably in Germany and Austria. In the Euro area, comprising 19 different economies, over two thirds (61%) of the population uses online banking.

“New entrants and new habits among consumers combined with changing economies and regulatory environments are transforming banking services as we know them,” says Csaba Izbeki, Managing Director at Kyndryl Eastern Europe Territory. “Digitalisation is the foundation of these shifts. We see that today every financial services company – no matter if it is an established bank, or a startup challenger – is looking for new IT integration services and solutions that help automate operations, predict outcomes, prevent cyber-attacks and better manage increasingly diverse workloads and platforms on premise or in the cloud”.

All this points to a financial services industry that is likely to look very different in the near future.

IT Services Integration – Key to Successful Banking Digitalisation

Digitalisation is now at the heart of banking operations. A Kyndryl sponsored research by SeeNews in banking sector in SEE countries (Bulgaria, Croatia, Hungary, Romania and Slovenia) found that every year more than half a million new clients begin looking for new digital offerings from their bank. In 2021 the top 87 SEE banks spent approximately 700 million euro on IT with a growing proportion invested in new digital services. However, while almost all SEE banks have undergone at least one digitalisation initiative in the last year, the demand for existing and new digital services is increasing exponentially.

The research shows that SEE banks are heavily investing in IT. Yet, the return on these investments (ROI) varies. Clearly, the organisations with the highest ROI are the ones with a holistic approach to banking in the digital era. Merely introducing disparate online services or high-end products is not enough to achieve sustainable ROI.
“As lines between finance and technology increasingly blur, the success and sustainable ROI from the digital strategies in banking lies very much in the right IT services integration that is specific to each financial organisation,” adds Izbeki. “As an IT services integrator, Kyndryl is managing the services and underlying infrastructure in an integrated and unified way. We are modernising our clients’ IT environments to help them meet increasingly complex customer demands, improve business processes and profitability. Such integration brings order to the modern multicloud, multi-platform and multivendor IT environment, helping banks consolidate IT management more efficiently, and providing greater visibility across discrete servers, networks, and applications.”

“The right technology and the industry expertise to put that technology to its best use are instrumental in keeping up with a rapidly changing financial services landscape. With Kyndryl and its partners, clients have both.”

Some examples of how Kyndryl is driving innovation for its banking clients include end-to-end innovation by integrating digitalization through multiple layers of their operations – from modernising core processes in back-office systems through developing front-office digital platforms and client-facing online systems.


• In Hungary, CIB Bank Ltd., one of the major Hungarian banks, has engaged Kyndryl in a three-year technology services agreement to modernise and operate its lending workflows and the underlying platform. As a universal credit institution, CIB Bank offers a full range of commercial banking and investment services for nearly 415,000 clients through a nationwide network of branches, while constantly seeking innovative solutions tailored to its clients’ needs. As part of its partnership with Kyndryl, CIB Bank is updating its lending processes and how they are managed. It’s a change that enables the bank to more swiftly respond to market and regulatory changes, as well as streamline workloads and processes for the bank’s employees.

“Having to deal simultaneously with old and new applications, as well as with different and disparate processes being introduced over the years in an unintegrated way, we were facing a serious challenge due to the not fully-fledge structured approach, a huge limit to allow the proper scalability” says Sante Cusimano, COO and Management Board member of CIB Bank Hungary.

• In Slovenia, NLB Group, a leading banking and financial group headquartered in Ljubljana, Slovenia and with an exclusive strategic interest in SEE, works with Kyndryl to transform its data eco-system and leverage new growth opportunities in an increasingly competitive banking market.
“We decided to improve our Data and Analytics capabilities and transform NLB Group to one of the best IT & Data companies in the region,” says Goran Golubović, General Manager, NLB. “The new platform, powered with machine learning and artificial intelligence capabilities, is improving our data insights, leveraging data for better customer experience. It will allow us optimisation of banking processes, personalisation of services and will lead us to data driven decisions.”

• In Bulgaria,
o Raiffeisen Bank works with Kyndryl in a five-year IT services contract to design, develop, implement, integrate and optimize main applications running on the bank’s business processes platform. Key point for this engagement was Raiffeisen Bank’s decision to run a platform for digital business processes leveraging Kyndryl Bulgaria’s vast industry knowledge. Currently Kyndryl Bulgaria and Raiffeisen Bank Bulgaria are partnering in Agile teams for digitising retail and corporate banking, automating credit and loan origination processes, card and loan logistics, and more. As a result, Raiffeisen Bank now manages more processes in automated paperless form, significantly speeding up banking operations and optimising cost per loan. Digitalising loan processing services has helped Raiffeisen to reduce its loan processing cycle gradually from five days to 15 minutes in an E-loan process. This innovation results also in 30% fully end-to-end digital credit processes for the bank and high customer satisfaction (Net Promoter Score – above 70%).

o First Investment Bank (Fibank), one of Bulgaria’s biggest banks, has entrusted to Kyndryl to manage the design and the implementation of its latest and most innovative service – a modern automated, online loan processing system. The service, already fully functional, is now used by employees in all branches of the bank.
Kyndryl has developed the solution using business process automation technology and carries out its ongoing operational management. Consumer loans up to 80,000 Bulgarian levs (41,000 euro) with term up to ten years are provided fully online, without compromise in security. The borrower is identified by an ID card and a selfie sent online. This allows employees to focus on direct customer service and saves time on processing repetitive transaction requests.

“We chose to partner with Kyndryl Bulgaria because this is a global company whose technology solutions meet Fibank’s high standards for implementing digital innovations for the benefit of customers,” said Nikola Bakalov, CEO and Chairman of the Board of Fibank. “It helped us optimise our lending service by digitising work processes, eliminating manual operations involving paper documents, and achieving a higher level of security in the storage of customer data. This significantly shortens the duration of the application and approval stages for consumer lending.”

• In Cyprus, The Bank of Cyprus, a leading banking and financial services Group in Cyprus, has expanded their collaboration with Kyndryl with a new five-year managed IT services agreement that advances bank’s ESG commitments through 2030, by supporting the bank’s levels of service, giving access and visibility to its products to all stakeholders. Kyndryl assists the Bank of Cyprus to further shape its long-term IT strategy by leveraging digitalisation and supporting the development of digital platforms, whilst offering the bank’s clients an integrated, automated, and secure banking environment. Kyndryl will also work with the bank’s Technology Division to develop a roadmap for transitioning to public cloud using a multi-cloud approach.

“Bank of Cyprus was ahead of many financial institutions in recognizing that we need to be fast and agile when we transfer our existing business models into digital ones – securely, reliably and cost-effectively,” says George Kousis, Acting Executive Director Technology and Operations, Bank of Cyprus. “The contract with Kyndryl accelerates our digital transformation, allowing us to focus on our core business and improving the speed and the precision with which we develop and introduce personalised digital financial services.”

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