NCR Has Tentative Deal with Russia

LONDON - NCR has a potentially lucrative "framework agreement" to help modernize the creaking savings bank system in Russia.

The deal could ultimately result in a top-to-bottom technological retooling of the Russian Savings Bank, which provides basic banking services to Soviet consumers.

But an official of the U.S. company, now a unit of American Telephone & Telegraph Co., stressed that under a letter of intent signed by the Russian Republic's Ministry of Finance in Moscow last week, extensive studies need to be carried out on how to achieve comprehensive Western-style automation of the republic's banking industry.

Studies Needed

"At this stage, we prefer to call it a framework agreement, which will include a full feasibility study, rather than a formal contract," said an official at Munich-based NCR Osteuropa who requested anonymity.

The unit handles NCR's existing business throughout the Soviet Union and Eastern Europe.

The agreement calls for a sweeping modernization of the Russian Savings Bank, which has 40,000 branches and 124 million individual accounts.

The plan is to introduce full electronic data processing and telecommunications capability "in both the back and front offices of the bank," the NCR official said.

ATM Network Possible

This could include the installation of a network of automated teller machines, he added.

The NCR executive said a number of details remained to be clarified before work is started on the project, which will take several years to complete.

The biggest hurdle will be financing the massive project, which an NCR official said could cost more than $1 billion. Help is likely to be sought from the World Bank and the European Bank for Reconstruction and Development, which are both earmarking considerable sums to assist the onetime communist state to adopt Western market reforms.

Other Western banking technology suppliers are also expected to compete against NCR for the business, the NCR official said.

Old Hand in Eastern Bloc

NCR Osteuropa has carried out banking automation work in Eastern Europe for a number of years, with 1990 revenues in the region reaching $24 million, the official said.

"This is a bold move by the Russian banking industry to jump immediately to really modern Western technology in order to update their systems," he added.

In a related development, Visa International announced that its card will be issued by Moscow-based Credobank, marking the first plastic to be issued by a private bank in Russia.

The charge card, on which balances must be paid every month, will be aimed at a growing number of Russian business people traveling abroad, Visa said.

At the same time, Intourservice, an affiliate of the state tourism organization, has opened a computerized card-processing center in Moscow. It will provide authorization and transaction processing services in Russia.

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