As BankBoston Corp. prepares to unveil the results of its six- month reengineering project, analysts say the bank is likely to focus more on technology and less on traditional branch banking.
The $71.4 billion-asset banking company plans to announce the results of the reengineering in two weeks. The project has focused on the back office and other operations that support BankBoston's 452-branch network in Massachusetts, Connecticut, and Rhode Island. Aston Consulting, New York, has acted as an outside adviser.
Analysts said BankBoston has been working to wring efficiencies out of its New England branch network since its 1996 acquisition of BayBanks Inc. A stronger emphasis on technology would support that strategy, they said.
"They have been rationalizing the branch network to get economies of scale from what they already have," said Steven Biggar, an analyst at S&P Equity Group.
Since last fall, BankBoston has announced the closings of 24 overlapping branches in Massachusetts and New Hampshire-nearly 3% of its combined BayBanks and Bank of Boston branches-and the elimination of 148 jobs.
At the same time, the bank has been adding to its technology-based services, launching a home-banking initiative and expanding its in-store electronic branches from 67 to 77 this year.
Recent management changes not directly related to the reengineering suggest BankBoston will put an even heavier emphasis on using technology to support its retail business, analysts said.
Last week, BankBoston announced a management realignment that creates three distinct groups: retail, wholesale, and global banking. The bank said in a June 10 memorandum to employees that the changes reflect the need to become more "customer-focused."
Among the senior staff changes, Lindsey C. Lawrence, an executive vice president, was named to head up a new Internet banking group, reporting directly to president and chief operating officer Henrique de Campos Meirelles.
Ms. Lawrence, who will work closely with new retail chief Bradford H. Warner, held a similar role at BayBanks, which analysts said was credited with being an innovator in electronic banking services.
She is charged with helping BankBoston "create the bank of the future," the June 10 memo said.
In an interview last week, Mr. Warner also explained that technology would play a major role in BankBoston's new retail organization.
Catherine Murray, an analyst at J.P. Morgan Securities, said BankBoston's strategy is not to acquire more traditional branches, but to focus instead on using technology to deliver banking services to retail customers more efficiently.
"They are starting out at a high level of technological expertise," Ms. Murray said. "They ought to be able to find ways to improve efficiency using technology."
Analysts said layoffs, particularly in the back office, would likely result from the reorganization, but none could estimate the extent of them.
BankBoston's chief executive officer Charles K. Gifford has said in recent months that staff cuts were possible. But he also said that those employees would be retrained for new jobs created in other areas of the bank.