Lloyds has finally inked a long-negotiated deal to outsource nearly 2,000 tech jobs to IBM.
The deal estimated to be worth more than £1.3bn over the next 10 years, but is expected to save the bank £759m.
Negotiations have come to a a conclusion and a deal was agreed today The Register first reported.
The transition to IBM is expected to take three years according to an update by Lloyds trade union to its 35,000 members.
Lloyds IT staff will be moved over under a TUPE agreement, however, the union says the jobs have not been guaranteed and only 500 will be permanent ones. It claims jobs will initially be based in Copley and Edinburgh but will then be outsourced to India.
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The union previously indicated concerns have been raised internally about the banks critical systems such as payments, treasury trading, settlements and its digital services being run by a third party and offshore.
In a memo to staff seen by The Register, Lloyds chief information officer Morteza Mahjour said plans had been put in place to mitigate risk and: "as customer demands change and innovation in the industry gathers pace, having a more modern and agile technology platform will help us lay the foundations for the next phase of our strategy.”
Lloyds Banking Group has been contacted for comment.