As they begin integrating systems of the new BankAmerica Corp., officials of the former NationsBank played down the significance of problems that occurred last weekend with its BarnettBanks Inc. conversion.

The old NationsBank is taking the lead in managing the systems integration of the nation's first coast-to-coast bank. Preceding this challenging merger, it has had to address shortcomings that caused customers at some Barnett branches in Florida to experience service interruptions.

The disruptions happened over Columbus Day, weekend when the bank took the dual step of closing 185 Florida branches and switching all teller stations at the remaining 517 branches to a new system. Delays occurred when tellers operating 72 stations did not properly sign on to the new software.

"It was more a case of the jitters than anything else," said NationsBank spokeswoman Jerri Franz. "They hit some wrong keys." Getting individual stations operating again required 35 to 40 minutes of instructions from a NationsBank technical support center.

The bank also had to process transactions manually for two commercial customers that had adopted new transit routing numbers a day before the system was ready, Ms. Franz said.

She added, "We did not have any actual systems outages the entire weekend."

"For the size of it, this merger has been smooth," said Robert C. DeLeeuw, a Wayne, N.J.-based technology consultant who has worked with NationsBank in the past. "If there are glitches, and there always are some small glitches, NationsBank is prepared to pounce on them."

The recent integration problems in Florida do not reflect on NationsBank's ability to digest BankAmerica, added Mr. DeLeeuw. He noted that an earlier NationsBank merger with Boatmens Bancshares involved 53 separate systems. "In that respect, it was more difficult than Barnett, and more difficult than Bank of America could be."

Observers said the BankAmerica merger may pose challenges to NationsBank's traditional procedure, which involves quickly converting acquired banks' systems to its own.

John Pries, a partner of the New York-based Mitchell Madison Group consulting firm, questioned whether NationsBank's emphasis on common systems can be sustained in the complex environment of the new BankAmerica. "Too much heterogeneity leads to Balkanization and islands of automation," said Mr. Pries. On the other hand, "too often, homogeneous solutions become ungovernable" because they strip flexibility from the hands of managers responsible for maintaining profitability.

Further complicating matters is the fact that "Bank of America has a much more heterogeneous vendor environment for information technology projects," Mr. Pries said.

But some said BankAmerica's diverse technology was a key reason for its wanting to team with NationsBank in the first place. Before the merger, Bank of America had been considering a multimillion-dollar investment to consolidate its four deposit systems.

The early selection of NationsBank's "model banking" system for retail banking-the only major technology decision of the new bank to be announced so far-may be a result of Bank of America's desire to consolidate its multiple retail systems.

"Model banking was a catalyst to facilitate the merger," said Nicholas C. Bradick, vice president of client management and delivery at American Management Systems Inc., Fairfax, Va. "It was a very strategic move for the old Bank of America to provide a vehicle for its disparate systems."

"Bank of America had not gone to next-generation consumer banking technology, and therefore was facing its own need to invest to obtain what NationsBank already had," said George Bicher, analyst at BT Alex. Brown. "The merger will obviate the need for Bank of America to spend considerable money to create this type of platform."

R. Jay Tejera, an analyst with Dain Rauscher in Minneapolis, described his dismay upon learning last year that BankAmerica sold an average of 1.7 products per household, far below the industry average of 2.3 to 2.6.

"Bank of America has a crown jewel branch banking distribution systems and great brand equity," he said. "For them to have the opposite was just astonishing. In the branch system, Bank of America wasn't where it wants and needs to be with technology."

In an interview before the closing of the merger, former NationsBank executive James D. Dixon, the new bank's group executive for technology and operations, had expressed his confidence in NationsBank's model banking system. "Model banking anticipates volumes of this size," he said, referring to the merged bank. "I'm comfortable in saying that it is a correct presumption that operations and technology will be delivered as it is today (at NationsBank)."

Speculation is riding high that the former Bank of America would provide the merged bank's data warehouse. Bank of America has been running a full- scale data warehouse since 1986, and many observers said it offers more promise than the system that NationsBank has pieced together in recent years.

"Bank of America has made great strides in data warehousing, allowing them to do targeted customer acquisition and retention," said Kathleen Khirallah, senior research analyst with the Newton, Mass.-based Tower Group.

"NationsBank wants its model banking to have this capability, but they have not developed anything that is as robust or mature as Bank of America" in the data-warehouse field, Ms. Khirallah said.

"Bank of America has taken the use of the data warehouse far beyond what any other institution has done," said Mary Ann Beach, a Nashville-based bank technology consultant. She said the bank has been successful, for example, in using data warehousing to determine the best product mix for two merging banks.

"NationsBank runs from a position of operating efficiency, and Bank of America has a different value proposition of customer relationships and client intimacy," Ms. Beach said.

The new bank has estimated it will save $1.3 billion over two years by integrating its systems. But a combined price tag of $380 million to fix the year-2000 computer problem may make this goal elusive. Conversion of California deposits to the model banking platform are not likely to occur until after the year-2000, and then it is likely to be taken in two steps: northern California and southern California.

As the big merger progresses, vendors will be among the most careful observers. Technology companies face enormous pressure to win contracts with the top banks, as purchasing power gets consolidated there. Already, the share of technology spending by the 10 largest financial institutions has risen to 50% from 33% at the start of the decade, said Mr. Pries of Mitchell Madison.

The new BankAmerica, for example, will process as many checks as the entire Federal Reserve system combined. "They have a scale on the payments- system side that they almost become the de facto standard," Mr. Tejera said.

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