IBM Canada Ltd.’s brokerage
services division, Securities Industry Services (SIS), and National Bank Financial (NBF), the wholly-owned subsidiary of National Bank of Canada, signed a $200-million, nine-year agreement designed to transform the bank’s brokerage service for greater productivity and business value.
The agreement builds on an existing deal between IBM and National Bank coincided to end at the same time, according to Martin Landry, managing director, Financial Services sector at IBM Canada.
About 115 full-time employees and 60 consultants will move from IBM to NBF in Montreal and Toronto. With that transition, IBM is acquiring vertical talent, says Landry. “IBM will bring its skills to the table and (we’ll) inherit their skills.”
He says the deal is unique for the industry and IBM. “It’s a broader concept than just taking over the operational IT infrastructure.”
IBM will design, build and operate new processes in the applications and IT operations service area that enable NBF to focus on its core business while driving growth in key areas. National Bank Financial provides trading and custody services to 80 independent financial services firms with more than $26 billion assets under administration.
New services being provided will include managing National Bank Financial’s application suite, improving response times at customer service centres, managing IT operations and introducing new Web-based offerings and workflow tools.
“What makes this opportunity possible is the unique relationship of the SIS brokerage service package that a number of firms use for their dealer business,” says David Wood, NBF executive vice-president and chief administrative officer. “That is at heart of all of our systems. It’s the foundation of our technology platform.”
Wood says the relationship with IBM will allow the company the opportunity to create a more NBF-centric package. “It allows us to look at a our total platform and determine what better resides at the mainframe level versus what should be an application run-off of an AS/400 using database updates each day,” Wood says. “It’s taking our entire technology platform and putting it in a more efficient structure by leveraging off the fact that IBM owns this brokerage platform and can help us to get more value from this platform.”
One of the primary drivers in the partnership, says Wood, is that NBF business is becoming more commoditized — customers are willing to pay only so much for its services.
“You have to put them into a framework where you can deliver the