Chapter 17. Halifax Bank Of Scotland: IF.com

Halifax Bank of Scotland (HBoS) is a UK Financial Services provider with divisions in Retail Banking, Insurance & Investment, Business Banking, Corporate Banking, and Treasury. HBoS is the UK's largest mortgage and savings provider with a customer base of about 22 million. The annual results of 2003 reported £3.8 billion profit before tax and £408 billion assets under management. HBoS group was formed through the merger of Halifax and Bank of Scotland.

Intelligent Finance was launched as a division of Halifax plc with the aim of attracting new customers from outside Halifax and specifically to target the UK clearing banks. Intelligent Finance was launched as Project Greenfield in 2000, starting an entire new banking operation from scratch. Three years later, by the end of 2003, Intelligent Finance had 820,000 customer accounts, representing assets of £15.5 billion. In March 2004, Intelligent Finance announced that it had broken even in 2003the project had been a huge success.

In order to prevail in a highly competitive market, a unique product concept had to be devised, enabling customers to link a range of personal banking productsmortgages, credit cards, personal loans, savings, and current accountsin any chosen combination with interest charged only on the difference between their debit and credit balances.

In order to enable Intelligent Finance to provide cost-effective products, it was decided to use only direct channelsthat is, not to rely on expensive branch offices. Because market research at the time showed that customers would prefer to do business with a bank that combined Internet banking with phone banking, it was decided to offer a solution that combined telephone and Web access.

At the heart of the Intelligent Finance system is a generic banking engine, which offers access to products and services for the different customer access channels. The Intelligent Finance system was probably one of the largest and most advanced SOA deployments in the Financial Services industry in Europe at the time. Because of time pressure under which the project was deliveredit took almost a year for the complete implementation of the bankit was decided early on in the project to take a full-blown SOA approach for its transactional aspects. The banking engine provides a suite of XML Web services, processing over 1,000,000 SOAP transactions a day.^[1] This chapter will take a closer look at the history of the project, the impact that the SOA approach had on the overall architecture, and the lessons learned in the project.

^[1] Intelligent Finance adopted SOAP in the very early stages of the specification process. The SOAP version in use was upgraded several times throughout the project, in order to stay in line with the development of the SOAP specification. Service interfaces where initially defined in a proprietary, XML-based IDL, which was later updated to the emerging WSDL standard.