B of A's Answer to Creating Technology Quickly: Bring Compliance Close

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Bank of America is taking a stance when it comes to iterating and creating new financial technology.

The Charlotte bank is making sure its compliance employees are sitting closer to its tech folks. The goal: to create apps and banking software that is both secure and useful.

"It's a new landscape," explains Dave Godsman, B of A's digital banking solutions and operations executive. "The speed at which change needs to happen."

The ubiquity of smartphones, along with banks' need to iterate responsibly (read: regulation) necessitates a high level of collaboration between innovation and legal needs whereas in the past there would have been none.

Godsman along with several other B of A executives, including Hari Gopalkrishnan, B of A's eCommerce, architecture and segments technology executive, took part in a breakfast for analysts and reporters this week in Manhattan. The purpose was to pull the curtain back a bit, and disclose the bank's software strategy.

It was fairly cryptic. Still, a few details emerged.

Gopalkrishnan described a typical app development process that puts several of B of A's "best and brightest" programmers in a room for a week or so in order to create functional code.

The rub? Compliance officers are in the room soon after those developers leave. They're making sure, Gopalkrishnan says, that those coders haven't taken things a bit too far.

Making sure they give customers the chance to opt-in and opt-out of services; making sure those people's phones aren't being geo-cached at every point; and insisting on encryption, among other issues.

The process, and the growing partnership between departments, has ramped up gradually over the past several years as the bank has perfected its technology. Compliance officers, executives say, want to be in the room.

There are, of course, still bugs to be worked out.

In June, Gavin Munroe, the CIO in charge of IT and services at Bank of America's Home Lending division, described how B of A was streamlining its mortgage processing technology to better process mortgage modifications and service borrowers. He gave a roughly 30-minute talk at Pegasystems' user conference, PegaWORLD, in Orlando.

B of A's culture, Munroe explained, created unforeseen problems with employees sticking to old work habits and, in some cases, entire departments pushing back. "It felt like we were playing whack-a-mole," joked Munroe at the time.

But that doesn't mean the bank isn't trying to quickly move forward.

"The business has changed," said Godsman. "We deliver software."

The frequency and the delivery of such, he says, has forced large companies to think differently.

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