People's Bank in Connecticut has chosen Unisys Corp. to switch its branch network to client/server technology.

Under a three-year contract, valued at $1.6 million, Blue Bell, Pa.- based Unisys will serve as the single source of network management services for People's. It displaces the bank's service relationships with several other technology providers.

Through the agreement, the Bridgeport, Conn.-based bank expects to reduce costs by $100,000 to $200,000 per year.

The deal is also expected to increase the reliability of computing systems and improve customer services , according to Tom Jagodzinski, first vice president of technology and communications, at the $6.4 billion-asset institution.

The bank's use of outside technology specialists to handle network operations and management reflects a growing trend. The 1995 technology in banking report from Ernst & Young and the American Bankers Association - which focused on the top 100 U.S. banking companies - says 23% of respondents already outsource the management of network operations, up from 14% the previous year.

Another 14% of top banks are considering using outsourcing to maintain network equipment, according to the report.

Industry analysts attribute the growth in outsourcing to the increasing complexity of technology and to the rising costs of providing complex support tasks in-house.

Mr. Jagodzinski said having a single vendor handling integration issues will relieve the bank of complex, time-consuming tasks.

Through its Desktop Services program, Unisys will maintain more than 1,500 computer systems and network devices at the bank's 80 branches and main office.

This includes personal computers and servers from AT&T Global Information Solutions, network routers from Cisco Systems Inc., and printers from Hewlett-Packard Co.

Unisys is also installing 700 new AT&T teller stations, which should all be in place by November.

The bank is using Windows-based branch automation software from Ampersand Corp., a division of Electronic Data Systems Corp.

The bank is investigating a move to Windows 95 or Windows NT - computer operating systems from Microsoft Corp. - but firm plans have not been made, said Mr. Jagodzinski.

As the primary systems integrator, Unisys will administer existing product warranties, manage the bank's relationship with other service providers, and configure hardware to run with third-party and in-house software.

With engineers situated throughout Connecticut, Unisys will be able to quickly respond to network problems, Mr. Jagodzinski said.

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