When John Beahn started his career in the technology business, he developed an interest in banking because of the stability of the jobs that could be found in the industry.
The 49-year-old Mr. Beahn, who will head up the network data services unit that Electronic Payment Services Inc. bought from Mellon Bank Corp. last week, said his first jobs with International Business Machines Corp. were making his still-young family feel like a group of nomads.
"One day my [7 year-old] daughter is sitting there ate the breakfast table counting on her fingers the number of states that she's lived in, and I said to myself, |I think she's sending a subtle message."
Processing Experience
In 1983, after 16 years with IBM, Mr. Beahn left the company - ". . . before it was fashionable to do so," he notes - to take his first banking position in the data processing unit of First National Bank of Oklahoma City.
It was here that he got his first exposure to the automated teller machine processing businesses that have occupied the greater part of his career since leaving IBM.
When the First National Bank of Oklahoma failed in 1986, the data processing unit, which was a publicly traded company, lost it largest customer, and began to head downhill.
After helping to orchestrate a leveraged buyout of the unit in the late 1980s, Mr. Beahn and the other managers were able to turn the fortunes of the company around.
On the strength of that experience, Mr. Beahn in 1990 moved on to a position at the helm of the network services division of Mellon, which provides ATM network gateways and processing services to about 800 financial institutions in 35 states.
Processing Grows
At the time Mr. Beahn arrived at Mellon, the bank was selling ATM services on a purely unbranded basis.
This was because Mellon in 1989 had sold off its branded ATM switching business, known as CashStream, to the MAC ATM network, which at that time was owned exclusively by CoreStates Financial Corp., based in Philadelphia.
While observers said the network services unit was functioning profitably during Mr. Beahn's tenure as general manager, Mellon nonetheless seemed increasingly willing to sell the unit to one of the mega-networks that had emerged in the Northeast.
Both NYCE, which is operated by the New York Switch Corp., based in Hackensack, N.J., and MAC, which is operated by Electronic Payment Services, Wilmington, Del., have added significantly to their processing businesses over the past three years.
With both networks interested in adding to those businesses, Mellon decided that it could sell the network services unit as part of a deal to acquire an equity position in one of the networks.
2,700 ATMs
NYCE was a front-runner in the competition for Mellon's unit, but last week MAC, which is now owned by four other banks in addition to CoreStates, won out.
Mr. Beahn will now become an employee of the MAC network, taking the position of president and chief executive of EPS' network service division.
He believes the acquisition by EPS will greatly benefit his unit in the area of telecommunications.
Mellon's network services unit operated about 2,700 ATMs for its customers. Many of these machines are located in regions where MAC already has a strong presence.
This presents an opportunity for EPS to aggregate its telecommunications and generate significant cost savings, Mr. Beahn said.
Better Positioned
In addition, Mr. Beahn believes operating under the EPS banner might make his unit more responsive to the latest technologies.
"When you take a look at the larger banking community, there are so many places that are competing for technology dollars," Mr. Beahn said.
"The fact that EPS' primary business function is transaction processing would say that they are going to be investing their technology dollars and research dollars in that business," he said.
A final perk of the EPS acquisition for Mr. Beahn is that it will not require him to move his family.
The network services division will continue to operate in the Pittsburgh data site it currently occupies.
