First Chicago NBD Corp. has hired American Management Systems Inc. to help it develop a letter of credit processing system.

The two companies said they will invest $17 million in new object-oriented software, imaging technology, and computer hardware.

The system is to be part of the bank's overhaul of its trade finance operations.

American Management Systems officials said the development project should take about two years to complete. Specific terms of the contract were not disclosed, nor were details of the bank's letter of credit business.

Frank C. Schell 3d, senior vice president of the bank's global trade services unit, said the new system would improve the bank's competitiveness "through lower costs of doing business."

The global trade services unit was formed from the merger between First Chicago Corp. and NBD Bancorp.

In a separate announcement, American Management Systems and Royal Bank of Canada have unveiled Internet software that they developed jointly.

The software, called Import Direct, will let Royal Bank of Canada's corporate customers apply for new letters of credit over the worldwide computer network. It also will let customers access the bank's back office letter of credit processing system to amend exiting letters of credit.

Michael Klausner, spokesman for American Management Systems, said the system, cheaper to operate than a private network, will help the bank to do business with a wider array of corporate customers.

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