As digital technology has become more fundamental to the business of banking, and as information technology units have become part of the basic fabric of running a bank (see related article), technology priorities are evolving rapidly.

A group of 50 bank chief information officers and senior technology executives provided insight into areas that they are refocusing on — and how they are aligning budgets with new priorities — through an online survey SourceMedia's research unit fielded in July. Respondents were drawn from banks across the asset-size spectrum, and most have long tenures in the bank IT world.

The results show that IT executives recognize that they cannot slacken attention on the basics of managing bank computer systems, but that they are dramatically increasing effort and resources devoted to protecting data, building out new services and functions for customers, and striving to integrate IT functions more closely with overall corporate strategy.

Respondents were asked to rate the extent to which various tasks and objectives had been prioritized.

Data security, developing customer-facing technology, vendor risk management and supporting big data and analytics topped the list of items receiving greater attention. A third of IT executives who have worked at their banks for at least one year said customer-facing technology used in things like mobile and online banking had strongly increased as a priority, and 45% said the priority on such technology had increased moderately. More than 40% said the priority on data security had increased strongly in the last year, a larger proportion than for any of the other tasks and objectives considered.

Executives who reported an intensified focus on data security said the shift was driven by regulatory scrutiny and the rash of recent data breaches. "Incidents are becoming regular around the industry," one said. Likewise, respondents said regulatory oversight and security concerns have sharpened concentration on vendor management.

Bank CIOs who said customer-facing technology has become a higher priority have been motivated by rapid customer adoption of digital services, competition, and a desire to capture a new generation of customers, executives said. Similar forces underlie prioritization of big data initiatives, according to respondents. "We need better understanding of customers' behaviors and how they engage with us," one executive said.

Nearly half of respondents said IT's role in driving corporate strategy had increased as a priority during the last year. Executives cited reasons like the centrality of technology in determining the quality of customer experience and relentless competitive pressure to keep up with innovations. These findings mirror a redefinition in the way CIOs see their roles — less as back-office engineers and more bridge navigators and strategic advisers (see related article).

Few respondents reported deprioritizing any particular aim or responsibility even as other areas drew more attention. In fact, significant factions reported increasing emphasis on blocking and tackling, with 40% saying backup and disaster recovery had increased as a priority, and a similar proportion saying the same for systems availability and responsiveness. Executives noted that maintaining uninterrupted service for customers and employees is vital, and that reliable backups are essential for any IT system.

Spending forecasts generally aligned with priority assessments. About 75% of respondents said their banks planned to increase spending on security in 2016 and none predicted decreases in security spending. Between 46% and 62% predicted their banks would increase spending on data analytics, mobile banking, compliance and online banking next year, while no more than 4% predicted decreases in any of those categories.

Branch technology ranked near the top, at fourth place. The future of the branch is being shaped by strong crosscurrents. While digital banking is reducing branch traffic, kiosks and technology that links mobile and online activity to physical locations are being used to enhance the branch experience, and about 35% of respondents predicted increases in branch technology spending in 2016. Among those reporting larger budgets for branch technology, 25% forecast increases in spending on the order of 20% to 49%.

Also echoing the survey results on IT priorities, respondents said that competition and the desire to attract millennials figured prominently among factors driving IT budgets: more than 30% named each among their top three motivations for technology spending.