Last week, Sovereign Bank announced that it had been chosen by the Commonwealth of Massachusetts to run its core depository and disbursement business. Sovereign won these components of the business away from the incumbent provider, FleetBoston Financial (Boston, Mass.), which will still provide the Commonwealth with lockbox services.
Winning the three-year contract was a big win for Sovereign, which also serves in a similar capacity for the City of Boston. "The entire $34 billion budget of the Commonwealth will run through our bank," says Marshall Soura, executive vice president and managing director of the global solutions group, Sovereign Bank (Philadelphia, Pa., $41 billion in assets). "We're going to disburse a huge volume of their checks every month -- anywhere from 700,000 to 1 million checks per month."
Sovereign will provide Commonwealth employees with accounts on its image-based client access system dubbed "IRIS" (Interactive Reporting and Initiation System). IRIS users will be able to track payments, view check images, and initiate and receive wire transfers and ACH payments for the sub-accounts that they manage. Also, the use of image-based positive pay will help combat check fraud by allowing employees to ascertain, for example, whether the payee line on a suspect check had been altered.
The client access system uses cash management software from Politzer & HANEY (Newton, Mass.). In the back office, the bank recently changed its item and check processing partner from Fiserv (Brookfield, Wis.) to InterCept (Norcross, Ga). To handle Sovereign's transaction traffic, InterCept built new facilities and hired employees in New England. Fiserv remains Sovereign's core banking software provider.
For Commonwealth employees and constituents, the upgrade to an image-based system will result in greater efficiencies, says Soura. "If there's an item that's in question, they can resolve it faster -- because they can see it," he says. "They don't have to put a request, manually, into the bank and wait for the bank to research it in their archives."
"Everything from generating wires to looking at images of items, all will now be virtually real-time," Soura says.
See also:"Playing for Keeps" Bank Systems & Technology, September 2002