sberbank 2

As institutions grapple with the opportunities brought by tech, some have embraced it. Sberbank's chief technology officer outlines how the Russian bank is transforming its tech stack and working practices.

David Rafalovsky

David Rafalovsky

Three years ago, Sberbank launched the next phase of its transformation, with the goal of becoming a technology company with a banking licence. It created its own cloud-based platform, Sber Digital Platform (SDP), to develop, evolve and build on.

“It was a gutsy decision,” says David Rafalovsky, chief technology officer at Sberbank Group and executive vice-president, global head of operations and technology. He joined the Russian bank in March 2018 to be part of “re-engineering the technology organisation to take the bank to the next level”.

SDP is a cornerstone of the bank’s strategy, on which it builds everything from core banking to customer-facing applications. Mr Rafalovsky says the bank is well on its way to migrating around 80% of the volume of Sberbank’s client transactions to the platform by 2021.

“It has taken significant investment and technical talent, and with this platform we can control our destiny,” he says. “We can evolve quickly in line with our priorities; we don’t need to wait for our partners to modify their platforms.” He adds that Sberbank has gone from measuring time to market in quarters to measuring it in weeks.

Different ways of working

To create its cloud-enabled platform-as-a-service solution, Sberbank moved more than 25,000 people to agile methodology in less than four years. “We had to quickly learn the difference between a typical waterfall model and agile – culturally, technically and infrastructurally – and we had to adjust on the fly,” Mr Rafalovsky says.

Career history: David Rafalovsky  

2018 2018 Sberbank, group chief technology officer (CTO), executive vice-president and global head of operations and technology

2015 Citi, managing director, CTO of Citi global functions

2003 Citi, global head of Citigroup architecture and technology engineering

He talks candidly about missteps along the way. “A year or so into our agile transformation, we understood how difficult it is to be a developer or engineer in the modern technology company. It’s not only about DevOps, but about the entire product development life cycle, from the idea origination to prototyping, testing and reiteration,” he explains.

The bank decided to build a single cohesive developer platform, SberWorks, for its developer community, which has been “phenomenally successful”, according to Mr Rafalovsky. Today, 40,000 developers and engineers are live on SberWorks, which houses the product development cycle from beginning to end.

“It’s not only more convenient for users, it is also more predictable and reliable from a management point of view, because all our rules, regulations and checkpoints – whether architecture or governance – are in an all-encompassing and integrated workflow. This means that if we need to change something, we only have to change it in one place,” he explains. Sberbank now has 2500 concurrent product teams working on different products at any given time “without stepping on each other’s toes, without waiting for one another, without constantly resolving conflicts”.


Scaling up challenges

The bank faced some difficulties in quickly scaling up its development community because the Russian market is overheated. “We’re not the only institution that is undergoing significant digital transformation, so competition for talent is fierce,” says Mr Rafalovsky. Plus, the Russian IT community is not used to working in highly distributed teams, preferring large development centres. “It’s easier to co-create and collaborate when in the same room. However, that is not always possible, especially in the current situation,” he adds.

Sberbank’s management team decided that the bank will become a customer of its own supercomputer.

The Covid-19 pandemic has been challenging, especially the move of almost 100,000 employees into remote-access mode, but the bank has adjusted well, “which is down to thoughtful technology and infrastructure investments, and remote-access and collaboration mechanisms. Importantly, we did not stop any major projects,” he says.

In attracting talent, Sberbank has several qualities working in its favour, according to Mr Rafalovsky.

“First, the bank’s scale: we have 100 million active customers, of whom 60% are active in digital channels. We are able to offer our engineers large-scale problems, which makes us attractive as an employer. Second, we have relatively little legacy and are working on cutting-edge tools, platforms and technologies. Third, we are forward-looking in our investments and do things other banks simply don’t,” he says.

Super capacity

Mr Rafalovsky points to the bank’s supercomputer, called ‘Christofari’. “Not many banks build their own supercomputer, but we did,” he says. “We also invest in foundational research – as opposed to solely the applied space like most other institutions – in areas such as artificial intelligence (AI), voice, video and image recognition processing. That’s how we managed to attract as many engineers as we did.”

A year and half ago, Sberbank decided to build Christofari in partnership with US tech firm Nvidia, when it realised that the demand for compute capacity needed for AI model development exceeded the capacity available in the Russian market. The bank also concluded that it could help the market by making this capacity available to other organisations, and commercially launched Christofari in December 2019.

“Sberbank’s management team decided that the bank will become a customer of its own supercomputer, effectively creating a level playing field between itself, which can afford to build a supercomputer, and a small start-up in the Urals, who could never build a supercomputer nor normally have access to it,” says Mr Rafalovsky.


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