Mergers and acquisitions have become increasingly active in the banking sector. The COVID-19 pandemic has intensified pressure on banks worldwide, prompting financial institutions to increasingly consider strengthening their businesses. For example, in April, one of the largest deals in recent years was completed — PNC Financial Services acquired the US division of Spanish bank BBVA for $11.6 billion.
Furthermore, another factor driving bank mergers has been the growth of fintech-companies. Traditional banks are being forced to unite to develop digital platforms and services.
Mergers and acquisitions in the banking sector are invariably accompanied not only by financial and legal changes but also by significant technical challenges. Ensuring timely error resolution, system stability, and compliance with new regulatory requirements falls squarely on the shoulders of IT specialists.
These professionals often operate under tight deadlines and high expectations, as noted by Evgeny Shamovtsev, a 14-years veteran in the development and maintenance of banking systems, including Oracle databases.
Today, our guest expert is a specialist from Eastern Europe. Experts from this region are consistently ranked among the top in technical skills, particularly in business, technology, and data science. Evgeny shared his experiences from the merger of major Russian banks that play a significant role in servicing Eastern European industries.
During this process, he successfully addressed challenges such as synchronizing data across different time zones, modernizing legacy systems, and automating routine processes.
In this interview, the expert answered questions about overcoming challenges, the most effective technologies used, and the key factors for successful bank system integration.
Evgeny, you were involved in the merging of two major Russian banks, Uglemetbank and Neryungribank, which are key players in serving the heavy industry of Eastern Europe. As a result of this deal, Uglemetbank became one of the largest in the country. How did you participate in the process of merging the databases of the two institutions, and what stages were the most critical?
Perhaps the most critical period was the first few days following the merging announcement, especially for IT departments. It was necessary to ensure that balances were transferred from the branch to the head office in a timely manner and that data was reconciled at the end of each day.
The situation was complicated by the fact that the head office was in a different time zone. Initially, the balance reconciliation process took place at the end of the business day. In other words, data was transferred asynchronously from our branch in Neryungri. Later, most processes were synchronized, and information was transferred in real-time.
What were the main difficulties encountered when synchronizing data from multiple bank branches? How did you ensure the integrity and accuracy of the information during the integration process?
One of the primary challenges we faced during the initial stages was the concurrent access to the same records. To address this issue, we explored various solutions, including temporary or staging tables in databases, triggers, scheduled jobs, and more.
While databases have built-in mechanisms to ensure data integrity, we implemented additional controls such as logs and automated checks for an extra layer of security.
When merging banks, it is essential to consider the security and confidentiality requirements of customer data. What measures did you implement to protect information during the migration process?
Primarily, this involves assigning permissions and permission groups for users from both branches, in some cases maintaining logs of changes made by users and other technical data, and establishing various restrictions and permissions for actions in specific situations. All of this must be carefully planned and coordinated with the security department.
One of the outcomes of the merger was the creation of user-friendly solutions for both employees and customers. For instance, your well-known reporting module has significantly saved employees time. What other benefits has the bank gained from implementing this IT solution?
The module has freed employees from routine tasks. It has become a tool that provides flexibility in implementing new reports, reducing the workload on programmers. We have been able to free up working hours for more interesting and complex tasks in the future.
I can say that indirectly, the module has positively influenced the merger process, as have many other small improvements and new solutions. Everything is interconnected.
Your IT solution also enables employees without specialized technical knowledge to work with reports. Has this relieved the workload of IT department employees?
Yes, absolutely. A huge amount of time was spent on repetitive tasks by programmers — creating new reports or modifying old ones. Our solution has allowed us to redistribute responsibilities: now most changes can be made by users themselves.
In the context of large-scale data integration, this module has become especially important, as it has helped to reduce the time required to adapt reporting in the unified system. When banks merge, the data structure changes, and new indicators emerge that need to be considered in reports.
The automation and flexibility of the module have allowed employees without technical knowledge to quickly adapt reports to new requirements on their own. This has significantly reduced the workload on the IT department and accelerated data analysis processes.
You also automated many data processing processes. Which of these automations proved to be the most useful after the merging was completed?
These include various automated data loads and unloads into databases. For example, so that users in both systems could see the same data they needed for real-time work. This primarily concerned reconciling balances. At the end of each day, we worked with Oracle support. In addition, terrorist and debtor blacklists—all of this also needed to be synchronized in real time to update data for all users.
More and more banks are striving for mergers and acquisitions. In your opinion, what technologies and approaches will make such processes faster and more efficient in the future?
First of all, I would call timely preparation one of the most important stages. This includes, among other things, conducting pre-merging tests: both from the side of programmers and from the side of ordinary users.
Usually, this is determined according to what exactly needs to be combined, synchronized, and what to abandon. However, each decision is made individually.