CIO interview: Simon Bateman, Allica Bank

The UK-wide Covid-19 lockdown in March did not stop challenger bank Allica from launching new services, as the bank’s CIO, Simon Bateman, explains: “When Boris [Johnson] said we had to work from home, we had 60 staff work remotely. We did our first deposit launch and wrote our first commercial loan during lockdown. We have had a considerable amount of inquiries and seen growth in the loan book during lockdown.”

Bateman has a background in retail banking. His most recent post before Allica Bank was as CIO at Harrods Bank and he has worked as IT head at Aldermore Bank, Lloyds Banking Group and Produban SCL, part of Santander.

His experience of the limitations of IT in traditional banking has informed the IT strategy that Bateman has taken at Allica Bank.

One of the key pillars of the bank’s IT strategy has been to use the Microsoft Azure public cloud, as Bateman explains. “When I joined in May 2018, we decided to build everything from scratch in the cloud using the Microsoft suite,” he says.

Allica Bank worked closely with Microsoft’s Fast Track team to build a system within Azure that would keep customer data safe and comply with strict regulations. As well as using Azure to store customer data securely, Allica also gives its staff access to Microsoft Dynamics 365.

Talking about the difference between the IT systems at traditional banks and the approach he has taken at Allica, Bateman says: “Historically, big banks build their IT around a core banking platform.” But for Allica Bank, the goal was to avoid having all the bank’s services constrained by the core banking system, he says.

“When I set up the tech team, our aim was to be based around the application layer, rather than the core banking system,” says Bateman.

“We have the ability to offer new services without trying to get a square peg into a round hole”

Simon Bateman, Allica Bank

Being focused on the application layer rather than a core banking system, Allica’s IT team would support the bank’s growth plans better by being able to provide its target customers – small and mid-sized businesses – with a full suite of products built on banking applications based on best-of-breed back-end providers, he says. What this means for Bateman is that the bank has the flexibility to incorporate new banking software as and when it becomes available.

The bank has used FMS.next as its digital banking platform, he says. This is Allica Bank’s back-end transaction platform for lending and savings. For Bateman, among the key benefits of this platform is its flexibility, which core banking systems have traditionally lacked.

“We have the ability to offer new services on top of the back-end without trying to get a square peg into a round hole,” he says. This means Allica can look at other products in the banking software market to enable it to offer services such as asset finance or cashflow management.

From an IT architecture standpoint, Allica Bank has taken an application programming interface (API) ecosystem approach to building out the IT that underpins its banking system.

Instead of deploying an entire software stack from a major financial software platform provider, he says an API ecosystem approach means “we aren’t constrained”.