Chase Manhattan Bank is using client-server technology in an ambitious project aimed at simplifying the arcane business of international trade finance.

Chase is developing a number of advanced systems in which information is distributed across a network. But it is among the first banks to build a distributed system that is international in scope, one that ultimately will allow bankers in New York, London, or Hong Kong to originate letters of credit on the same network and to view documents no matter where they are located. The new software is tied to a major redesign of business processes aimed at creating standard procedures for handling letters of credit across the globe. Chase currently operates multiple systems to originate and track the documents. Currently under development by teams of programmers in New York and in Hong Kong, the software will be rolled out first to Chase's Hong Kong offices in the second quarter.

"For the first time, we will have a single letter-of-credit system," said Hoyt Masur, vice president of Applied Technology at Chase. Bank officials declined to say how much the system would cost.

Letters of credit are often used in international trade. For example, an exporter will arrange for a bank to issue a letter of credit to guarantee payment on a certain date by an importer. The bank acts as guarantor as long as certain conditions are met. Chase, one of the largest issuers of letters of credit, has developed over time multiple systems and ways of processing letters of credit.

Areas like the Far East, which generate many export letters of credit but few import letters of credit, have their own set of procedures, and systems. A system in the Far East might treat an import letter of credit, which is more common in Europe, as an exception item. At the same time, specialized systems and procedures have evolved in Europe, where more import letters of credit are generated. "We ended up with tailored systems, optimized to the various restrictions and conventions of the region," said Eugene Friedman, Chase's vice president of applied technologies. With the new system, Chase will be able to process a letter of credit anywhere around the world, no matter where the client is located. If a customer requests a letter of credit near the close of business in Hong Kong, the letter of credit can be completed by a banker in New York.

That means a company with offices in the United States and Hong Kong that initiated a letter of credit in Hong Kong could call a Chase office in the United States to find out the status of the letter of credit, rather than waiting for the opening of business in Hong Kong.

"Client-server applications allow us to offer better service to the customer by giving us easy access to information anywhere," said Mr. Masur.

The system has a tracking component which will let a Chase employee know where a letter is going, to whom it is guaranteed, and the time frame for which the document is issued.

Today, Chase can originate letters of credit in any of its offices. But the letters are stored on host systems, and back-office processing tends to be done in just a few locations, including New York, London, Hong Kong, and Singapore.

Bankers can access that kind of information from other offices on their computers. If in the future, Chase wanted to process letters of credit in new or alternative locations, the system would make that shift simple. Mr. Masur and Mr. Friedman said the project would not have been possible without two things: a cultural climate at Chase that encourages different divisions and geographical regions of the bank to work closely together, and the adoption of technology standards across the bank.

The adoption of bankwide computer and communications standards "has given us global reach on a very rapid basis," Mr. Friedman said.

The letter-of-credit system is now primarily a software project, since most of the hardware required for the client-server access is already in place around the world.

The system will not only speed the processing and servicing of letters of credit, it will also make it easier for bankers to learn how to process letters of credit, bankers said. "We can now develop a global training system, rather than having one for each location," said Mr. Friedman. Thus, he said, training will be easier, and less expensive.

Bankers trained in one site will see exactly the same graphical user interfaces and procedures in any location. "The only thing that will differ is the files you access, and those are transparent no matter where they are," Mr. Friedman said. Underpinning the system is the Sybase relational data base. Several years ago, Chase embarked on a project to make Sybase the standard data base used in servers across the bank. With Sybase deployed in AT&T-supplied servers, Chase employees using desktop computers can access information on any of Chase's host computers, which also run a standard data base, DB2. "Sybase is really flexible for data storage," Mr. Masur said.

The use of these standards "puts all locations on an interchange basis rather than a file transfer basis, and distributed computing then becomes real," said Mr. Friedman. The system will be used by Chase bankers on workstations using the Windows operating system. The system has been built in-house by development teams in Hong Kong and New York - the two Chase regions where expertise about the letter of credit process is greatest. Mr. Friedman said the teams had traveled frequently back and forth and had numerous telephone calls and video conferences during the course of development to keep the project on track. One of the trickiest parts of development was building a common framework that was flexible enough to be used by offices anywhere in the world.

"One thing that's stuck in my mind is the importance of developing an early and sustainable architecture," said Mr. Masur. The project involved business users not only in the early stages of the development process, when their needs were defined, but throughout the process. Mr. Masur said that because business units can change procedures continually, the teams went back time and again to users to find out whether there were any changes in the procedures. The project designers are taking a great deal of care in installing the system, which will be rolled out in phases, function by function. "The number of globally distributed systems is still very, very small," said Mr. Friedman. "The companies that are working on them are solving technical problems that did not exist before."

Ms. Iida is a freelance writer based in New York.

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