Big banks love to boast about their focus on innovation and installing cutting-edge technology. But how much is Wall Street really spending on IT?
A recent UBS report analyzing US banks' technology budgets offered a breakdown of large-cap banks' investments in tech. The Swiss bank used a combination of conference transcripts, FactSet data, and the banks' internal information to compile the chart.
It should come as no surprise that the biggest players in the space — JPMorgan, Bank of America, Citigroup, and Wells Fargo — maintain the largest budgets.
JPMorgan, the highest spender, has a $11.4 billion technology budget this year, a 5.6% uptick from last year's $10.8 billion. Bank of America's IT spend was second, at $10 billion, followed by Wells Fargo at $9 billion and Citigroup at roughly $8 billion.
It's worth noting that JPMorgan said nearly half its 2018 technology budget was focused on disruptive technology within the bank, while Bank of America said it put 30% of its budget toward "technology initiative investment spend." Vanessa Colella, Citigroup's chief innovation officer, spoke with Business Insider in February about how her bank approaches tech investments.
The size of technology budgets decreased significantly beyond the top four — US Bancorp was the next largest, at roughly $2.5 billion, of which nearly half is considered operating expenses, according to the report.
The breakdown indicates a widening gap between large and small banks' technology budgets. The latter has struggled to keep up, limiting innovation at regional banks required to focus on maintaining older systems.
Here's the entire breakdown from the UBS report:
