Last week thousands of Wachovia Corp. brokerage employees were briefly unable to access a key computer system that had been introduced over the Labor Day weekend, when Wachovia transferred 1.9 million former Prudential Securities customer accounts.
A series of other system failures, including the shutdown of a back-office server, plagued the brokerage later in the week, forcing brokers to use backup systems and telephones to complete some transactions.
Wachovia Securities LLC of Richmond, Va., was formed in July 2003 by the merger of Wachovia's brokerage with Prudential Financial Inc.'s. Wachovia, of Charlotte, owns 62% of the joint venture; Prudential Financial, of Newark, N.J., owns 38%.
News of the system's troubles - first reported Sept. 9 and outlined in detail Tuesday in The Wall Street Journal - seemed to contradict an initial description of the conversion by a Wachovia Securities' spokesman.
The spokesman, Tony Mattera, had said Sept. 7 that the conversion went "smoothly" and that the Prudential Securities accounts were successfully transferred. On Tuesday he repeated that and said last week's system failures were unrelated to the conversion.
"The integration was accomplished beautifully," Mr. Mattera said Tuesday. "We had outages during the week that you might well have had without a system integration. The timing was unfortunate."
He said that when he spoke to American Banker on Sept. 7 he was unaware of any system failures. Some of problems arose later in the week, he said, including the 22-minute shutdown on Sept. 8 of a back-office system.
About 13,000 brokers and other employees use the new system. Trouble arose when employees in the former Prudential offices began using it for the first time on Sept. 7, and about one-third were unable to log on, Mr. Mattera said.
"I don't want to minimize the level of frustration" many employees felt, he said. Nevertheless "transaction volumes in the week were normal [and] business got done, though in a very busy and, in some legacy Prudential branches, frustrating environment."
Most of the problems were resolved by last Friday, Mr. Mattera said.
