Banks invest in data infrastructure to support future growth

New data centers are a sign that banks will try to strenghten client interaction and other business aspects

With an investment of R$1.1 billion, Santander Brasil inaugurated on Tuesday a new data center in Campinas, in the interior of São Paulo state, which will give the bank an increase of 50% in its current processing capacity and should become a command center for the Santander Group for the units in Latin America. The bank aims to use the new infrastructure as the base for growth projected for the coming years.

Looking toward the expansion of business, Brazilian banks are in the middle of a cycle of building data-processing centers, investments made to last decades. First in line, Bradesco put its data center in operation in 2008. Banco do Brasil inaugurated its new center last year and Itaú Unibanco prepares for the launch of two new facilities in 2016.

The expansion of infrastructure is a response of the institutions to the increase in transactions in recent years. This is due not only to increased banking, but to changes in the way that banks interact with clients.

Until the mid-2000, most of the transactions were done at bank branches and the process was finalized in the evening. Today, with more channels of access available, clients carry out more transactions demanding immediate responses from banks. This increases the need for storage, processing and information security.

With the launch of Santander’s new data-processing center, the old data infrastructures in São Paulo city will be de-activated and all processing and storage activity will be directed toward Campinas. The technology was built on a plot of 800,000 square meters, and, in addition to increasing capacity by 50%, it was projected to grow by up to 6 times in the coming years in acordance with demand. The facilities begin operation with a capacity of storing more than 5 petabytes, or 5 million gigabytes, and the mainframe — the main computer of the bank —can carry out, on average, 210 million transactions per day.

“This [the construction of the data center] reflects our enormous confidence in Brazil and in our franchise in the medium and long term. This gives us a base to continue growing,” said Jesús Sabalza, Santander CEO, during an inauguration ceremony of the new space.

There were more than a few technological failures that Santander faced since the combination with Banco Real in 2009. Problems on some days prevented the payment of bills through internet banking and even withdrawals from ATMs. In 2011, during an interview with Valor, Marcial Portela, former CEO of Santander Brasil, admitted that the interruptions caused losses of clients.

Even though it’s no guarantee that the customer will never face technological problems with the bank, the new Santander data center is capable of assuring 99.995% of availability of stored data, even in case of disasters, according to the tier IV certification granted by the Uptime Institute. Only 12 other data centers in the world have this certification.

Only 12 other data centers in the world have this certification. Still without a datae set, the new center in the future will also work as a command center for the Santander Group for Latin American units.

In a similar move, betting on growth of the bank, Itaú is investing R$2.3 billion in the construction of two data centers in the region of Mogi Mirim, São Paulo. The new structure will substitute the data center of the bank in the neighborhood of Mooca, in São Paulo city, which would become insufficient in 2018.

The project, according to infrastructure director Rooney Silva, has three great stages that include the construction of 6 data centers on a plot of 815,000 m2. The two first will be launched in 2016, and two more will be ready in 2023 and, finally, the last two will be delivered in 2035. “Our projection is to support the bank for the next 30 years,” explains Mr. Silva.

Banco do Brasil invested in the expansion of its infrastucture to support transactions over the next 15 years, says the general manager of technology for the Banco do Brasil, Daniel Oliveira. The bank already had a central technology complex in Brasilia, with two data centers opened in 1998 and in 2010. The second complex, known as Digital Capital, was inaugurated in March last year and had investment of R$1.85 billion. 

The new processing center was built in a public-private partnership model of the federal government, with Caixa Econômica Federal, another state-run bank.

At Bradesco, the processing capacity of the data center opened in Osasco, São Paulo, in 2008, can still be doubled with the computers it has today. Even in times of peak activity, when the machines reach 300 million transactions, there’s still an idle capacity of 30%. “We’re in a quite comfortable situation today,” says Waldemar Ruggiero, head of data processing at Bradesco.

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