Mellon Adds Top Mainframe From IBM as Business Gains

Mellon Bank is one of the first banks in the country to install a new top-of-the-line mainframe computer from International Business Machines Corp.

Mellon installed the ES/9000 early this month. Although bank officials declined to give the exact cost, they said they received a "substantial discount" off the computer's $27 million list price as part of IBM's early-installation program.

The size and speed of the new computer have already improved service for the bank's data processing customers, officials said.

Two other banks have bought the computer since it was introduced in September, but IBM declined to name them.

Service Improvement Noted

"We believe this system attacks the problems of response time, speed of delivery, and reliability far above what we've seen in any previous systems," said David A. Moore, senior vice president of the information processing group at Mellon.

The new computer will dramatically improve access to information for Mellon's bankers across the network, according to Mr. Moore.

The mainframe represents a 10% improvement in operating costs over the two mainframe computers it replaces.

"We'll see a substantial reduction in the number of people required to run the system," Mr. Moore said.

The ES/9000 computers are are the largest manufactured by IBM. They represent IBM's bid to bolster its presence in large-organization computing systems, one of the few bright spots in a flat market.

Fault Tolerance Built In

The new computers use very high-speed fiber optic communications technology so the mainframes can communicate efficiently on networks with computers from other vendors.

The IBM systems also have built-in backup in the event a component fails, a feature called fault-tolerance.

Mellon bought the high-end ES/9000, Model 900, to replace two IBM 3090 mainframes. The new computer is about 2.2 times faster than the 3090, which was IBM's previous top-of-the-line.

Mr. Moore said the bank decided to upgrade because of the expectedgrowth of Mellon's processing businesses. He estimates a 13% annual growth in mainframe processing needs.

More Outsourcing Landed

In the last few days, Mellon signed outsourcing agreements with $1.8 billion-asset Bank of Oklahoma, based in Tulsa; and with Hometrust Bank of Georgia.

Mellon expects growth to come from acquisitions of other banks, and through the growth of cash management, bank processing businesses, and outsourcing services, he said.

Mr. Moore said the bank was able to cut response time to its data processing customers in half because of the new machine's superior communications capabilities.

The bank also has cut in half the time required to run reports for internal management and for customers.

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