From online banking to strengthening the shared economy’s financial infrastructure, fintech startups are transforming the economic world. For banks, in particular, this represents both a threat to business-as-usual and a significant opportunity to innovate and improve competitiveness.

With a well-known presence in the financial industry, IBM is exploiting the power of data and the hybrid cloud to further the digital transformation of these institutions and empower them to face the disruption, according to Riccardo Forlenza (pictured), global managing director, Citigroup, at IBM.

“While I think we’re all tired of hearing that data is the new oil, it is also true that we need to find a way to finally harness the power of it, and that’s what I think IBM is more adept at,” he said. “I’d argue that many of the common threats that we’ve seen across financial institutions … are really around cloud, around data and around digital transformation.”

Forlenza spoke with John Furrier, host of theCUBE, SiliconANGLE Media’s livestreaming studio, during IBM Think. They discussed IBM’s solutions for the financial institutions’ hybrid cloud and innovation journey, its 100-plus-year partnership with Citigroup, and how this partnership fits well into the bank’s current momentum. (* Disclosure below.)

Helping Citigroup to infuse AI into internal audit practices

One of the financial institutions that has relied on IBM solutions is Citigroup, with a partnership of over 100 years. IBM is currently focusing on partnering with the bank in its hybrid cloud deployment, according to Forlenza. It is also helping the organization deal with regulatory requirements.

Late last year, banking regulator Office of Comptroller of the Currency collected a $400 million civil penalty against Citigroup for long-standing deficiencies in its enterprise risk management, compliance risk management, data governance and internal controls. This resulted in a remediation plan that the bank has put in place over the past two months.

“We are looking to help the bank make … the most of a good crisis, and so we’re helping, for instance, Marc Sabino, the head of innovation at Citi, find ways to infuse AI into their internal audit practices,” Forlenza explained. “It results in a much better outcome and at a lower cost, and it’s something that can scale.”

Going forward, the partnership between IBM and Citigroup will focus on three things, according to Forlenza. In addition to accelerating the bank’s hybrid cloud strategy, IBM wants to help the institution transform its operations and apply artificial intelligence and process automation skills and capabilities into them.

“I think if we do that, we’ll continue to collaborate and we’ll continue to have our partnership fully rest on two pillars … which are really innovation and trust,” Forlenza concluded.

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of IBM Think. (* Disclosure: TheCUBE is a paid media partner for IBM Think. Neither IBM, the sponsor for theCUBE’s event coverage, nor other sponsors have editorial control over content on theCUBE or SiliconANGLE.)

Photo: SiliconANGLE