Stung by early data breaches, some big banks have been quietly developing their own software products to protect their global assets.
According to Reuters, U.S. banks, including Goldman Sachs Group, Morgan Stanley, and JPMorgan Chase, are beginning to sell technology developed internally. Others, such as Bank of America Corp and Citigroup say they do not have similar plans.
According to research firm Celent, U.S. banks collectively spent $62.2 billion on technology last year, which includes the costs of creating their own.
Goldman Sachs has been working with software company Synchronoss Technologies to bring to market a business designed to secure data on mobile phones, partly through an internally developed software product called Lagoon. It allows employees access to work apps on their own mobile phones. The joint venture with Synchronoss will allow Goldman Sachs to receive a portion of the revenue from sales.
Previously Goldman Sachs spun off a company, Symphony, which developed a messaging and information system now widely used by Wall Street.
Morgan Stanley, on the other hand, is going to market with its Cloud container technology called Treadmill. Previously Morgan Stanley sold a presentation template company, Author, to Thomson Reuters.
This is by no means a cash cow for any of the financial institutions. It does take an expense item and turn it into a revenue item. However, it also bucks against the innate suspicion most banks have in using technology created by a financial services competitor. It remains to be seen whether this will become a side business for financial services hemmed in by industry and government regulation.