The biggest merger in U.S. banking history should require a technological consolidation of unprecedented proportions, operations experts said Monday.

Chemical Banking Corp. and Chase Manhattan Corp. said eliminating redundancies in areas such as staffing and branch banking will contribute quickly to the $1.5 billion of annual savings the banks expect the merger to achieve by 1999.

However, given the complexities and differences of technological systems used in the banks' back offices, experts said, savings from systems consolidation are likely to be hard fought and to come slowly.

Some believe that the merged bank, which would adopt the Chase name, would make extensive use of outsourcing services in an effort to simplify the consolidation.

"Because outsourcing deals do facilitate and expedite merger integration, I would expect to see them take advantage of those relationships where they make sense," said Lawrence A. Willis, an executive vice president at First Manhattan Consulting Group in New York.

In terms of estimated cost savings, the Chase/Chemical deal is clearly in a league of its own. The projected savings eclipse those expected from the 1991 BankAmerica/Security Pacific merger ($1 billion), the 1992 Chemical/Manufacturers Hanover deal ($750 million), and this year's First Chicago/NBD agreement ($200 million).

However, analysts are split on whether the consolidation also would be unique in the level of its complexity.

Mr. Willis said the merger would not be significantly more complex than other megadeals. "When you get to a certain size, they are all pretty much the same," he said. "Size is not what complicates the consolidation, it's the numbers of lines of business."

Diogo Teixeira, president of the Tower Group, Wellesley, Mass., differs. "I think, as the size goes up, complexity rises more than proportionally," he said.

The two consultants agreed, however, that combining back-office systems is a complicated and arduous task.

The "new Chase" would be aided by Chemical's experience in the Manufacturers Hanover consolidation. That effort, despite some computer- system glitches on the retail side, was viewed as a success.

Still, obvious conflicts exist.

Chemical is committed to retail core banking systems from Alltel Information Services Inc., while Chase uses a variety of other vendors for retail software.

In addition, Chase's check processing operation runs on systems from Unisys Corp., but Chemical uses equipment from International Business Machines Corp.

The stakes on this front are high. Chase's check processing platform is part of a 12-year, $460 million outsourcing deal with Milwaukee-based Fiserv Inc. And last month, Chemical committed $50 million to a check image-processing system from IBM.

In wholesale banking, Chase and Chemical have built up formidable fee- based transaction processing businesses. Both banks were pioneers in setting up subsidiaries - Chase's Infoserv and Chemical's Geoserve - that focus on providing corporate clients such technology-intensive products as cash management, securities processing, trust and custody administration, and funds transfer services.

Salomon Brothers analyst Diane Glossman expects cost savings in the wholesale area but said that, in some areas, the banks' businesses are complementary. Chase's Infoserv has been stronger in international cash management services and global custody, she noted, businesses that require substantial and continuing technology investments in order to stay competitive.

The merged bank expects to trim about 12,000 of the current 75,000 jobs in the next three years. Denis J. O'Leary, a Chemical executive, would be the combined banks' chief information officer.

Brian Tracey contributed to this article.

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