Sees Opportunity to Trim Costs by Converting to Trustware System

Countering the notion that outsourcing is the best way to keep a lid on data processing costs, Chicago-based Boulevard Bancorp is moving its $1.8 billion-asset trust business out of a service bureau and bringing it in-house.

David Raub, senior vice president at Boulevard, reports that the bank is in the final phases of converting to the Trustware Series 7 system from National Computer Systems Inc., Minneapolis. The conversion is to be finished in February.

The bank's primary reason for making this change was to reduce the costs of managing its trust area. Mr. Raub expects, for example, to see significant back-office savings in the securities clearance and settlement area.

Going Paperless

In the past, service bureau clerks had to handle these transactions by calling the custodian and checking to see if a trade was correctly registered.

The new system provides an automated clearing house interface that will enable the bank to credit a customer's account in a paperless environment. Confirmation information will also be posted via computer, so clerks will simply have to check their screens to verify a trade.

The new system also better positions the bank to increase its business without increasing fees paid to the service bureau. "By bringing the trust area in-house, we saw an opportunity to better control these kinds of marginal costs," Mr. Raub said. In addition, the Trustware system provides Boulevard with options for marketing products and improving reports sent to customers.

Improved Reports to Clients

With the Trustware system, Boulevard will be able to integrate investment performance graphs and analyses into the yearly and quarterly statements sent to customers. The new system offers over 300 of these financial yardsticks from which the bank can choose to create reports.

"Many of our larger customers, particularly corporate benefit plan managers, want to see in an easy-to-read format exactly how their different investments are performing," explained Mr. Raub, who estimates that from 15% to 25% of the bank's trust customers will use the service.

The Trustware system also allows the bank to perform asset allocation projections and set up "what if" investment scenarios for its clients.

At Boulevard, this service will be targeted to individuals concerned with retirement planning. It will also be used internally by the bank.

Ms. Sullivan is a freelance writer based in New York.

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