Natwest PLC, USA In NYC Mull Bids In Separate RFPS

The New York operations of National Westminster Bank PLC and the U.K.-based parent company's U.S. subsidiary, National Westminster Bank USA, are separately considering responses to RFPs for new trading rooms in New York. An estimated 200 positions are at stake in the two installations.

For NatWest USA, the selection process precedes a relocation scheduled for the fall of this year; sources say the firm expects to reach a decision on its vendors within the next few weeks. The system would be installed in support of trading in all the instruments in which NatWest USA trades, including government securities, foreign exchange, mortgage-backed securities, municipal bonds and equities.

NatWest PLC, meanwhile, is looking to upgrade its existing system, which supports traders in foreign exchange, money markets and "virtually" all instruments other than equities, according to NatWest PLC senior vice president Ian Johnson. The bank plans to pick its vendors by early June, and to have the new system rolled out before year-end.

Sources say that the decision to issue the RFPs was made in the context of a bankwide rethink of global systems strategy last fall. The rethink was occasioned by a senior management shakeup at NatWest PLC's headquarters in London. One visible outcome of the affair was the cancellation of a high-powered effort to build a proprietary trading group at trading subsidiaries NatWest USA in New York and County NatWest Securities Ltd. in London.

The project's leader, Greg Kipnis, was forced out when he refused to dismantle the team he had painstakingly set up, sources say. The team included a number of staffers who had relocated to London -- where the proprietary group was based -- from overseas (TST, Oct. 7, 1991).

Some sources say that one wider-ranging result of the shakeup was a decision to take a more modest route in terms of technology. Specifically, one source says, this resulted in the New York RFPs' requiring a considerable amount of DOS- based systems capability -- and a more limited use of UNIX workstations. The proprietary trading group was to have based its systems on Sun Microsystems Inc. workstations running UNIX and X Windows. The group evaluated feed-handling and workstation software from Teknekron Software Systems Inc. and FD Consulting Inc.

Sources say that Vouk Bellagic, one of the NatWest executives who was dismissed in the debacle, was active in general systems development decision-making at the New York trading room, in addition to his work on the proprietary trading project. Bellagic has since taken a position at Shearson Lehman Brothers Inc. in New York.

Both New York trading rooms are currently equipped with Reuters Holdings PLC/Rich Inc. video-switch systems for real- time market data distribution, supplemented by a handful of PC-based systems.

Both operations are looking separately to select a systems integrator and one or more hardware vendors to provide a digital data distribution system. Both seek solutions running on a mix of PCs and workstations, linked by local area networks.

Johnson says the two operations conferred in the course of vetting out their vendors, but says that in the end their respective business needs were dissimilar enough to warrant separate RFPs.

NatWest USA plans to move from its offices at 175 Water Street in Manhattan to new digs at 10 Exchange Place in Jersey City, N.J. Sources say the firm is moving because its business is expanding. While the current trading room holds 60 traders, the new floor is expected to house more than 100.

The release of the NatWest USA RFP came more than seven months after the firm installed a pilot of Market Vision Corp.'s Open Link digital data distribution and workstation software system for traders of equities and fixed-income securities (TST, June 17, 1991). The pilot was installed on six Sun SPARCstations running UNIX, X Windows and the OpenLook graphical user interface. The workstations are linked by Ethernet local area network.

Sources say Market Vision is now bidding primarily in response to the NatWest USA RFP, where that pilot is running.

In addition to the Rich video-switch system and the Market Vision-supported Suns, Natwest USA currently has a limited number of other local area network-based systems, mostly running on PCs. It is not clear whether and which other systems integrators have run pilots for NatWest USA.

At the time Market Vision's UNIX-based pilot went live about a year ago, one official at NatWest USA said that the system was under consideration for expansion across NatWest USA's entire trading floor. However, officials at Natwest confirm that they are considering a range of vendors under the current RFP.

NatWest PLC will not make the move to New Jersey, but will remain at 175 Water Street, according to NatWest PLC's Johnson.

NatWest PLC recently purchased a global license to install the Remos foreign exchange/money market deal capture, position keeping and risk management system. Remos is marketed by BT Financial Services Information Systems Inc., a subsidiary of Bankers Trust Co.

Remos went live in New York April 1. It runs on a DEC VAX processor, and is accessible to traders through the Rich switch via a VT220 terminal emulation. Johnson says that only the foreign exchange traders are using the system to date, but adds that the money market desk will soon follow suit. Meanwhile, NatWest PLC's London, Singapore and Hong Kong offices will begin using Remos between now and the end of the year.

Johnson says that access to Remos will be migrated to the new, digital system when it is installed.

Sources say that the bank's New York operations maintain a back-office processing center in Melville, Long Island. NatWest USA's trading group communicates with Melville via an IBM 3270 controller at the Water Street offices. Staff access back-office applications via PS/2s, running terminal emulations, and dumb terminals hardwired to the 3270.