Daiwa Next Bank, the Internet bank of Daiwa Securities Group, has selected Red Hat Enterprise Linux as its enterprise operating system for its core banking system. Red Hat is the world's leading provider of open source solutions.

The financial institution claimed that it has been able to reduce its technology costs by 50 percent by migrating from UNIX to Red Hat Enterprise Linux.

 "When Daiwa Securities Group's system renovation started in 2002, we realized that open source software is necessary for IT standardization to reduce cost, depart from vendor lock-in, and achieve reliable and stable operations," said Koichi Suzuki, senior executive managing director, Daiwa Institute of Research Ltd., a core information-generating institution within the Daiwa Securities Group, in a statement.

Suzuki said that Red Hat has a proven adoption track record with leading organizations, including the group companies.

“Since Red Hat Enterprise Linux is highly versatile, we can continuously utilize knowledge cultivated from others who have similar deployments and then apply these best practices to our systems,” he said.

Daiwa Next Bank completed the migration of moving from the UNIX-based package system to Red Hat Enterprise Linux in only nine months. Officials with Red Hat said that migrating to Red Hat Enterprise Linux provided the banking institution with several cost-cutting advantages.

"The cost to build our core banking system with Red Hat Enterprise Linux was cut in half compared to deploying UNIX," said Masami Mizushima, managing director, head of information technology department, Daiwa Next Bank.

"In addition, when hardware is procured in the future, we expect that the cost-effectiveness will be lower due to the high-availability of versatile servers. In the end, this will lead us to be able to provide valuable, long-term services to our customers," said Mizushima.

Company officials said that while maximizing Red Hat technology and synergy inside Daiwa Securities Group, the company will be able to provide optimized products and services that align with its customers' needs all from using open source technology as an enabler to achieve these goals.

"I think open source is the future and is most definitely the mainstream in cloud computing," said Suzuki.

"We believe that Red Hat, as a leading open source technology company, will continue to provide our firm with robust support and services enabling users to fully enjoy the benefits of open source,” he added.