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Navigating the Digital Frontier

An interactive analysis of core banking system modernization, moving from legacy mainframes to agile, cloud-native architectures.

This resource explores strategies, risks, and opportunities for banking technology transformation.

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The Core Dilemma: Legacy vs. Modern

Banks face a critical choice between the proven stability of mainframes and the strategic agility of modern platforms.

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Legacy: IBM z/OS & COBOL

The bedrock of banking for decades, prized for unparalleled security, reliability, and high-volume transaction processing.

  • Rock-Solid Reliability Engineered for mission-critical uptime, processing 87% of all credit card transactions.
  • Hardened Security Renowned for robust security frameworks essential for protecting sensitive financial data.
  • Agility Constraints Monolithic architecture hinders rapid product innovation and integration with modern APIs.
  • Skills Gap & High Cost An aging developer workforce and high maintenance costs consume up to 70% of IT budgets.
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Modern: Cloud-Native & Microservices

An architectural shift designed for agility, scalability, and continuous innovation in the digital-first era.

  • Enhanced Agility & Speed Accelerate new product launches by up to 60% through independent service deployment.
  • Elastic Scalability Scale services independently based on real-time demand, optimizing cost and performance.
  • Architectural Complexity Distributed systems introduce challenges in data consistency (ACID vs. BASE) and require new skills.
  • Migration Risk & Hidden Costs The journey is complex, with risks of operational disruption and unforeseen costs.

Modernization Pathways: The 6 Rs

Choosing the right migration strategy is a critical decision. Explore the "6 Rs" framework to understand the options, from simple lift-and-shift to complete rebuild.

🏢 The Vendor Landscape

Major technology vendors offer distinct approaches to mainframe modernization. Select a vendor to explore their strategy and key offerings.

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Select a vendor logo above to see their modernization strategy and offerings.

🇮🇱 Israeli Banking Context

Banking modernization in Israel must navigate specific regulatory requirements and compliance frameworks set by the Bank of Israel.

📋 Key Bank of Israel Directives

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    Cloud for Core Systems: Permitted for "material systems" under strict risk management, governance, and board approval (Directive 362).
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    Data Residency: Data can be stored outside Israel if the provider complies with GDPR-level protection.
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    Cybersecurity Framework: Unified framework (Directive 364) mandates integrated risk management and strong authentication.
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    Open Banking: Mandates for ISO 20022 and third-party access require secure, API-driven architectures.

🎯 Strategic Recommendations

  1. 1 Conduct comprehensive, AI-powered assessment of mainframe estate
  2. 2 Adopt phased, incremental modernization strategy to mitigate risk
  3. 3 Invest heavily in talent transformation and COBOL developer upskilling
  4. 4 Leverage AI and automation for code conversion and testing
  5. 5 Prioritize data modernization and rigorous dual-run validation
  6. 6 Ensure regulatory compliance and cybersecurity throughout process
  7. 7 Develop holistic TCO model and embrace hybrid cloud strategy