Deutsche Bank AG plans to double the product development team at its “Digital Factory” fintech center in Frankfurt to 800 workers by 2018 and struck a partnership with the Massachusetts Institute of Technology to foster new ideas.
The lender is introducing smartphone and web-banking facilities this year and early next year including mobile payments, a financial planner and a “digital marketplace” selling financial products, consumer banking chief Christian Sewing said at the software center in Sossenheim, Frankfurt Thursday. Most of the roles will be new, while some people will move from other positions at the bank.
Software developers and bankers work at the site, which opened in April to create fintech products near the lender’s headquarters. The expansion of the facility comes after the company abandoned plans for a new digital bank in the US just months after it was announced. Sewing reiterated plans to invest 750 million euros ($841 million) though 2020 to improve the bank’s IT and create digital products.
“Banks with an intelligent digitization strategy have the opportunity to win new clients” and Deutsche Bank wants to “create an easier, more efficient and above all a more digital bank,” Sewing said.
Germany’s biggest bank is trying to modernize its technology as the industry strives to adapt to growing competition from financial-technology startups, tougher regulatory oversight and increasing cyber-security threats. Deutsche bank has seen its shares decline to record lows this year, driven by concerns the bank may need to raise capital.
In its data centers, Deutsche Bank is trying to unwind and simplify IT systems built on older servers and mainframes to support mortgage lending, derivatives and treasury bond trading. “You’re spending a significant amount of money trying to get off these platforms,” Larry Tabb, chief executive officer of research and consulting firm, Tabb Group, said.
The Digital Factory’s first product, Deutsche Bank Mobile, was released in April and the bank plans to launch software to let customers manage multiple bank accounts from a common app by the end of November. Smartphone payments will be widely available next year, it said.