Chemical Banking Corp. is using image technology to restructure the way it processes securities for its corporate trust clients.
The $185 billion-asset banking company invested millions of dollars in the development of a proprietary software package that has been customized to meet various securities processing needs.
The software is being used in the bank's Geoserve unit, which provides transaction, fiduciary, and information processing services to corporate clients worldwide.
Reengineering the manual, paper-intensive securities processing operation has resulted in a time savings of approximately 40% since the new process was initiated for debt securities in March, according to bank officials.
By completely eliminating paper from Chemical's operations, the reengineering effort "represents a real revolution in securities processing," said Nick Papanikolaw, senior vice president responsible for global securities and trust operations in the bank's Geoserve division.
The bank captures images of securities soon after they arrive in the mail room. The securities images are then sent through an automated workflow application which enables system operators to process the images. Customer information needed to complete the processing of the securities transactions is automatically pulled down from Chemical's mainframe.
Since each operator can perform all processing and quality assurance tasks, the new software significantly reduces processing time. The previous system required each security to be routed through seven separate workstations, Mr. Papanikolaw said.
Chemical introduced imaging for equities processing in March 1994, and the new system became fully operational for debt securities in March of this year.
Mr. Papanikolaw said the system for equities processing paid for itself in less than a year, and he expects the same for the debt securities system.
The bank plans to use the software in the global securities area, and may have a pilot running before year-end, he said.