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Escaping legacy core systems in UK banks

Patching legacy systems is no longer an option for banks in a digital world.


The University of Surrey’s latest report—Escaping Legacy—has uncovered the stark finding that 40-50 percent of all banking IT assets are in urgent need of modernisation. For the United Kingdom alone, that’s a technology debt equivalent to the national pension’s deficit. This report is Accenture’s response to their findings.

Accenture's Time to Grasp the Nettle report has previously turned the spotlight on a dangerous lack of resilience in banks' core systems. Designed and built for a bygone age of branch-based banking and overnight batch processing, these systems, we argued, have grown massively complex, unreliable, expensive to run and unwieldy. In other words, they are no longer fit for purpose in a digital world. Have things changed? No. In fact, the situation has deteriorated. Post-Brexit, we are in an even more uncertain, unpredictable world than before. While the inclination for most banks is to hunker down, delay making decisions and wait for the storm to pass, this is no longer a viable option.

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Key Findings

Monolithic legacy systems stand in the way of digitalisation and hinder banks’ efforts as they face:

  • An explosion in digital technologies that has transformed the way organisations engage with their customers, and the products and services they bring to market.

  • New digital competitors emerging from left field.

  • A cloud proliferation and accelerated change of pace.

Boards know this but they view systems modernisation as overly complex, expensive and unacceptably risky. For these reasons, it typically takes a cataclysmic event, such as a full-blown outage, for banks to make change a priority. By then, of course, irreparable damage may have been done.


For banks to avoid catastrophic systems meltdown, the University of Surrey report includes valuable pointers to a successful migration strategy. The report suggests banks:

  • Adopt a business-driven, step-by-step approach.

  • Converge business and IT operating models to create one integrated digital organisation.

  • Tackle each layer of the IT stack with tools, platforms and services enabled by open cloud environments like Amazon’s AWS and Microsoft’s Azure.

  • Simplify data access and improve front/back-end integration using software packages and public cloud services to componentise heavily customised legacy core systems.

  • Inject innovation by replacing incumbents with new strategic IT partners.

We suggest an additional area for attention: Rebuild a base of talent who understand the legacy landscape and can plot a route forward, whether by hiring new talent or by partnering with experienced third-party providers.