AIB sues Oracle for €84m over failed implementation

Irish bank sues US software vendor after abandoning three-year Flexcube project

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Irish bank AIB is suing systems giant Oracle over a failed, €84 million implementation of its Flexcube banking software.

Dublin-based AIB bought the Flexcube banking solution from I-Flex Solutions, which is owned by Oracle and is now known as Oracle Financial Services, in 2007. At the time, AIB said that Flexcube would "further develop our operational effectiveness" and "deliver enhanced services to our customers and help us grow and develop our business".

An update on the project posted by Oracle in September 2008 said that some payments processing elements of Flexcube had gone live at AIB.

However, a case document filed at London's High Court this week, seen by Irish broadcaster RTE, states that the implementation was beset with technical and management problems. At the end of 2009, just 3,000 customer accounts out of a possible five million had been moved on to the new system.

Oracle gave the bank repeated assurances that the implementation would be completed on time, AIB alleges, but in March 2010 the project was abandoned and AIB reverted back to its previous system.

AIB says that it spent €84 million on procuring and implementing Flexcube. The figure does not include any other losses during the three-year period, which have yet to be calculated.

An Oracle spokesperson confirmed to Information Age today that a suit was filed by AIB at the end of January. "All of the allegations being raised by AIB are being rigorously defended by the company, and the company will also be counter-claiming against AIB for breach of contract and outstanding fees."