The Deutsche Wertpapierservice Bank (Dwpbank), a central service provider for approximately 70% of German retail banks, is undergoing a groundbreaking transformation of its WP3 platform. This move represents a critical step toward modernizing its infrastructure with a focus on scalability, resilience, and regulatory compliance, leveraging cloud-native technologies, Kubernetes, and a hybrid cloud architecture.

Redefining Financial IT Systems Under Pressure

In the high-stakes world of financial services, IT systems must operate with precision under constant regulatory pressure. Failures in availability or compliance can lead to significant consequences. The Dwpbank’s WP3 platform exemplifies how cutting-edge technology can meet these stringent demands. The bank’s transformation initiative, known as "MoveWP3", seeks to replace legacy systems with a modular, cloud-native architecture that integrates seamlessly with core banking systems while maintaining the highest standards of performance and compliance.

As a central pillar of Germany’s securities processing, WP3 processed more than 53 million securities transactions in 2024, underscoring its critical role in the country’s financial ecosystem.

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Transitioning from Legacy to Modern Infrastructure

Historically, the WP3 platform relied on stable but inflexible mainframe-based systems. Recognizing increasing limitations in scalability and adaptability, the Dwpbank initiated the phased replacement of these legacy systems. The new infrastructure is built on a Kubernetes-based hybrid cloud platform designed to deliver operational resilience while supporting innovation in a regulated environment.

The platform’s architecture incorporates bare-metal servers, eliminating the need for virtualization and enabling higher performance and system reliability. Specifically, the new system relies on a "Stretched-Kubernetes" configuration, distributed across three physically separate areas within two data center locations. Redundant fiber-optic connections and a strict separation of networks, power supplies, and fire protection systems ensure maximum fault tolerance and compliance with regulatory requirements.

Collaboration for Secure Operations

The Dwpbank has partnered with Finanz Informatik Technologie Service (FI-TS), the largest IT service provider for Landesbanken, to ensure the high availability and security of the new platform. FI-TS is responsible for managing the network infrastructure, storage, Kubernetes operations, monitoring, and platform updates. Their FI-TS Finance Cloud Native (FCN) infrastructure has been specifically tailored for highly critical financial systems, further strengthening the resilience of the WP3 platform.

For development and testing purposes, the Dwpbank utilizes services from Amazon Web Services (AWS) to ensure tool independence and flexibility. This hybrid approach enables a seamless integration of public cloud development with a highly secure private cloud production environment.

Advancing Cloud-Native Innovation in Finance

The transformation of the WP3 platform reflects Dwpbank’s emphasis on modularity and future-proofing. The system now runs over 400 microservices – handling key functions such as securities trading, savings plans, and capital maturities – on its new cloud infrastructure. With a Java-based foundation, alongside technologies like PostgreSQL, Kafka, and Angular, the platform supports efficient deployment of new features without disrupting ongoing operations.

The WP3 platform is not only designed for today’s securities processing but also positioned to accommodate future innovations in the regulated financial sector. For instance, the platform’s flexibility allows for the development of new offerings, including cryptocurrency trading and expanded securities savings options. These developments are tested in the public cloud and subsequently deployed within the private cloud for high availability.

Creating a Blueprint for Regulated Cloud Deployment

By demonstrating how cloud-native architectures can meet the demands of highly regulated industries, the Dwpbank provides a compelling model for organizations seeking to modernize their critical systems. According to the bank, the success of the WP3 transformation lies in the combination of advanced technology, clear operational structure, and early integration of regulatory requirements.

"What in the financial industry works under real-time conditions provides valuable insights beyond sector boundaries: for all organizations that operate critical infrastructures, must navigate regulatory change, and deploy cloud technology not despite but because of their requirements", the Dwpbank stated. The project sets a strong precedent for controlled innovation, secure scalability, and digital sovereignty in the 21st century.

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