Bank of America CTO discussed cloud strategy and tech savings

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Bank of America saves $2.1 billion annually in infrastructure costs thanks in large part to its transition of workloads to its private cloud in 2013, Howard Boville, Bank of America's chief technology officer told Business Insider.

The bank has transitioned 75% of its workloads to the private cloud thus far and hopes to have 80% there by the end of 2019.

In addition to cost savings, moving to the private cloud has allowed the bank to better monitor customer interactions.

One of the biggest banks in the world is enjoying significant savings to its tech spend thanks in large part to its decision to build out its own private cloud.

Howard Boville, Bank of America's chief technology officer, told Business Insider the bank will save $2.1 billion in infrastructure costs in 2019, a large part of which comes from moving a majority of its workloads from traditional on-premise servers to its private cloud.

The bank began the process in 2013 with a goal of moving 80% of its infrastructure to its internal cloud, which was built on OpenShift, by the end of 2019. Bank of America has almost reached the objective, with 75% having already shifted. That project was part of Bank of America's complete overhaul of its infrastructure, which began in 2012.

The bank's desire to focus on using its own internally-built private cloud, as opposed to public cloud vendors such as Amazon, Microsoft or Google, is contrary to what has become a growing trend on Wall Street. Banks have grown more comfortable using public cloud as they look to cut costs and innovate faster.

However, Bank of America maintains it makes more economical sense for it to keep workloads on its private cloud currently. The bank does do what it calls “controlled experiments” in the public cloud, but those are typically one-off calculations or work that is eventually brought into its private cloud.

The benefits of a private cloud over traditional databases in considerable. A private cloud essentially uses software to lash together existing data center hardware into a single unified platform — making more efficient use of each individual server, while also making it easier for developers to access and scale up their resources.

Boville said the bank now needs only 10,000 physical servers for the workloads that have moved to the cloud. Meanwhile, the remaining 25% requires five-times that number of servers to operate.

Read more: Wall Street is finally willing to go to Amazon's, Google's, or Microsoft's cloud, but nobody can agree on the best way to do it: 'If you pick a favorite and you're wrong, you're fired'

It's not just cost benefits Bank of America has recognized from the move to its private cloud, Boville said. The bank also has a better sense of its client interactions — of which on the consumer side there are 26 million daily. Everything from a customer's ATM card not working to a credit card transaction taking slightly longer to be approved is monitored.

All of this has only been possible with the rollout of the private cloud, Boville said, as the bank's various systems were previously too fragmented to get an overall view of the interactions.

“You can only really do that if you've actually got a kind of homogeneous cloud environment on what your applications sit upon,” Boville said. “We're harnessing that benefit in terms of being able to focus upon where we have issues we want to improve the quality of the service going forward.”

Bank of America's work in its private cloud won't stop at the end of this year. Even after reaching the 80% mark, Boville believes there will be at least an additional $100 million that can be saved via developments both in the cloud and on-premise over the next three years.

See more: Red-hot startup Snowflake is adding support for Google's cloud in an effort to meet Wall Street's demand

Granted, Boville said there are no plans to move certain parts of the business to the cloud. The bank remains a big user of traditional mainframe computers, and will continue to be as it's confident in the price, performance and time-to-market it gets from using them, he said.

However, some of the other applications that remain on premise and have proved difficult to shift to the cloud — Boville jokingly referred to them as “The Island Misfits” — will eventually transition to the cloud with the continued development of the technology. The end goal will be to give developers more freedom by offering a completely blank canvas, as opposed to segmented areas they can work in.

“You then are doing it in terms of the resources that you have and not islands of resources that can be used,” said Boville of the development of new applications. “The cloud is just this big thing that if you're a developer, you no longer care about what you're developing against from an infrastructure perspective, you're just getting these guiding principles to do so.”

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