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side, we’ve raised c. £175 million from more than 5,000 retail investors, and we’ve been able to launch our easy access accounts without any issues. We’re planning to launch notice accounts by the end of January. On the lending side, our loan book has increased to c.£300 million, with almost all of our clients commenting on how quick and efficient the process is.


The most exciting benefit that has come out of our move to the cloud so far, however, is what it has empowered and unleashed in the IT team. They’re able to benefit from creative freedom at a low cost. Why? Because it provides us with a platform that is secure, scalable and can handle rapidly increasing workloads; it allows us to benefit from the latest technology at a cost that our scale would not warrant; it enables us to avoids legacy issues being created; and finally because it provides us with flexibility. We can benefit from trial and error, testing and experimentation at a very low cost, as we don’t have to buy the infrastructure, we just pay as we use.


Another key benefit was the fact that we managed to break even in under a year. This is a significant achievement for any business to achieve within a year, but particularly for a bank as overheads are so high.


IBS Journal: Now that you’ve set a precedent, will we see more financial institutions making the move to the cloud? And, if so, are these likely to be other challenger banks rather than the big banks and their notoriously creaking legacy systems? Is it fair


www.ibsintelligence.com © IBS Intelligence 2017


to say that this is not suitable for every bank?


FG: I definitely think we’ll see this with other challenger banks – in fact, we’re already seeing it. In mid-December, Metro Bank announced that it had moved its IT infrastructure, including its core banking operations (run on Temenos’ T24), its digital offerings (Backbase) and ATMs, to Rackspace’s cloud offering. It took Metro Bank 12 months, but I imagine it would take mobile-only banks such as Starling, which has built its IT system from scratch, even less time.


While it will be much harder for larger banks to move to the cloud due to their legacy IT infrastructures, more are considering it as a result of mounting pressure to cut costs and increase flexibility. Last year, Deutsche Bank admitted that it had been thinking about providers such as AWS and Azure for three years, and that while use of public cloud by big global banks is “very small,” it expects adoption to grow significantly in 2017.


I think being in the cloud is suitable for every bank, it just might not be possible for everyone. This is because of lot of banks’ biggest challenge is bureaucracy and the fact that often the IT department works completely separately to the rest of the business. If you don’t have support from the top-down, moving to the cloud will be a very laborious and painful process. At OakNorth, we had the backing of the entire board which made our move to the cloud infinitely easier.


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