Headlines:
Key Extends Pact with Amro
KeyCorp's three-year contract extension with ABN Amro Holding NV brings new wrinkles to its outsourcing arrangement.
The Amsterdam financial giant said last week that it will develop a computerized "dashboard" to help KeyBank managers analyze data, track and control transactions, and manage funding and cash flow. KeyBank will also use ABN Amro's open-account systems for managing international transactions that do not involve letters of credit.
When Key signed the initial agreement with ABN Amro in 2001, it was one of the first deals of its type in the industry. David Verhotz, a senior vice president at Key and the national sales manager for KeyBank's Global Trade Services, said that at that time Key had been "at a major crossroads" in dealing with the rapidly automating trade finance market: It needed to upgrade its back-office systems or to outsource.
"We enhanced our capabilities on a private-label basis," Mr. Verhotz said in an interview. "We still own the client. We still own the credit aspects. We still own the sales and marketing function."
The arrangement has strengthened Key's ties to the middle-market companies that are its primary trade clients, and it has let the Cleveland company pursue larger accounts, he said.
As more enterprises seek international growth, that business model is likely to gain favor, Mr. Verhotz said.
"I think there's going to be a lot of banks - regional banks and banks that are in a tier below us - that are going to get into this. They're going to have to look at some kind of outsourcing scenario.
They're not going to be able to build what they need to remain competitive."
Discover, Teradata in IT Deal
The Teradata division of NCR Corp. of Dayton, Ohio, says Discover Financial Services has signed a contract to use a Teradata data warehouse, a multi-terabyte computer system.
The agreement, announced last week, includes Teradata hardware, software, and consulting services. Discover, a unit of the investment bank Morgan Stanley, will transfer to Teradata its store of information on 50 million cardholders and 4 million merchant and cash-access locations.
"Teradata's database system will allow us to realize faster response times to query and report requests with improved reliability and accessibility," Diane Offereins, the chief information officer at Discover, said in a press release.
