working with International Business Machines Corp. to upgrade technology in its branches and a 24-hour telephone banking center. The $30 million project will standardize retail systems in the bank's 500 offices in North Carolina, South Carolina, and Georgia. Acting as principal project coordinator, IBM is supplying its OS/2 Warp operating system, client workstations, printers, and a wide range of services, including installation, consulting, and systems integration. Wachovia will also use computer servers from AT&T Global Information Solutions, teller workstations from Hewlett-Packard Co., and printers from Lexmark International Inc. Platform application software will be supplied by Argo Data Resource Corp., and Broadway & Seymour Inc. will provide the teller software. Building on its relationship-oriented focus, Wachovia is upgrading branches mainly to bring its service to new levels, said Walter E. Leonard Jr., executive vice president of the $40.2 billion-asset banking company. Wachovia is based in Winston-Salem, N.C., and Atlanta. The new systems will supply "better services to customers with more speed and efficiency," he said. The mixed-vendor environment will let Wachovia take advantage of each company's strengths, Mr. Leonard said. "There was no need to give up features, functionality, and good pricing to be in a single-vendor environment," he said, adding that a mix of providers is becoming more commonplace in banks. Indeed, the transition from less flexible, mainframe-based branch environments to open systems that are interoperable is driving this trend, according to Bob Landry, a technology analyst at the Tower Group, Wellesley, Mass. While this would seem to spell loss of market share for IBM in the branch arena, the company's share is actually growing, particularly in large commercial banks, said Mr. Landry. The reason is that mixed peripheral environments raise service and integration issues, which IBM handles well through management and support services that are critical to large banks, he said. "IBM may be losing proprietary parts of the business," Mr. Landry said, "but they're winning in other areas." The new branch systems, which will replace the bank's IBM 4700 terminals, will be rolled out in phases. In the first phase, which has already begun, the bank is installing hardware and software. By the third quarter, the bank will add applications for electronic forms generation and loan automation. Early next year, software installations are scheduled to enhance marketing and additional lending functions. The company's full-service telephone banking center in Columbia, S.C., will also benefit from the technology, said Mr. Leonard. The project is expected to be completed by the end of 1996, although Wachovia has further plans on the drawing board, he said.

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