UniCredit SpA (UCG), Italy’s biggest bank, forecast savings of 725 million euros ($961 million) in 10 years from a joint venture with International Business Machines Corp. (IBM:US) to outsource information-technology systems.
“UniCredit’s partnership will allow the bank to have significant savings at not material costs,” UniCredit Deputy General Manager Paolo Fiorentino said at a press conference in Milan today.
Value Transformation Services, the joint venture in which IBM holds a 51 percent stake, will operate in Italy, Germany, Austria, the Czech Republic, Slovakia and Hungary, he said. Milan-based UniCredit will transfer 700 workers to the new venture as part of the agreement.
UniCredit and IBM, based in Armonk, New York, agreed in July to improve the bank’s infrastructure services as part of a plan, dubbed Newton Program, to cut costs and increase revenue through strategic partnerships. UniCredit Chief Executive Officer Federico Ghizzoni said last month he plans to reduce costs by 1 billion euros more than the 15.8 billion euros previously targeted by 2015.
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