Commonwealth Bank of Australia (ASX: CBA) shares are slipping today.
Shares in the S&P/ASX 200 Index (ASX: XJO) bank stock closed yesterday trading for $169.96. As we head into the Wednesday lunch hour, shares are changing hands for $167.66 apiece, down 1.4%.
For some context, the ASX 200 is down 0.4% at this same time.
That's today's price action for you.
Now here's how CBA aims to supercharge the pace of its innovation.
CBA shares embracing the Amazon cloud
CBA shares are making news after Australia's biggest bank also became Australia's first bank to move all of its primary banking systems to the cloud. That forms part of the company's $2.3 billion yearly spend on technology.
'The cloud', of course, refers to outsourced data centres, in this case managed by Amazon Web Services (AWS), a subsidiary of Amazon.com, Inc. (NASDAQ: AMZN).
According to The Australian Financial Review, the transfer of banking systems from CBA's own mainframe servers to AWS occurred 10 days ago.
CommBank's move to the cloud and adoption of artificial intelligence (AI) is intended to speed innovation and improve security, potentially providing long-term support for CBA shares.
Commenting on the migration to the cloud, Gavin Munroe, CBA's group executive for technology, said (quoted by the AFR):
This is a cornerstone for our enterprise transformation. We always wanted to get the core banking platform out of our legacy environment. We all know innovation and velocity is faster on the cloud.
Commenting on the costs involved to move to Amazon Cloud Services, Munroe added:
Cloud as a destination should be about more than cost; it is about DevOps, agility, velocity and stability…
When you have an agentic framework and expectations to interact with the bank in almost real-time, this requires a lot of performance tuning and architectural discipline, and performance is vital.
CBA's executive general manager of retail technology, Victoria Ledda, noted, "The agility of innovation is important. Traditionally, it would take months to set up and launch new products. Now it will be a question of weeks."
What are the experts saying?
Commenting on the potential impact for CBA shares, UBS analyst John Storey said (quoted by the AFR), "CBA is considered ahead of peers when it comes to tech, operating systems, AI enablement and size of investment spend."
Storey added, "Against this backdrop, CBA is the most efficient on cost-to-income among domestic peers already but has room to improve compared to best of breed global banks."
Despite today's slide, CBA shares remain up 25% since this time last year, not including dividends.
