Wachovia Bank to outsource work to Infy

By agencies   |   Thursday, 23 June 2005, 07:00 Hrs
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WASHINGTON: Wachovia Corp, one of the top banks in the U.S., will outsource technology work to Infosys in a move that will not only reduce costs but also cut an undisclosed number of American jobs, the company told its employees.

North Carolina-based Wachovia has narrowed its list of potential offshoring partners to Bangalore based Infosys and U.S. based IBM Corp and Cognizant, a spokeswoman said..

The affected group employs about 3,000 people who work on matters affecting all areas of the company. Although no decision has been taken on what companies it will use, the work will be done in India, she was quoted by the Charlotte Observer as saying.

Wachovia has identified technology functions that can be handled by vendors, but hasn't started shifting the work yet, she said.

''We've identified certain applications, development and maintenance work that we will transition to offshore vendors,'' she said.

''We will not transition them immediately.'' Offshoring technology operations are an increasingly prevalent practice in the financial services industry that has caused worries about the loss of U.S. white-collar jobs.

The Bank had disclosed in January that it was considering outsourcing and offshoring as part of an efficiency initiative to trim annual costs by one billion dollar by 2007.

Wachovia has said the company-wide effort, which includes other cost cutting, will eliminate up to 4,000 jobs.

Besides reducing costs, the company also is looking to get ''better value and higher quality'', she said. Wachovia has significant technology operations in uptown Charlotte and the University area. Overall, the company employs about 19,000 in the city, the Observer report said.

Wachovia will not be the first Charlotte-based bank to offshore technology work. Bank of America, another big bank here, began shifting some positions to a subsidiary in India about three years ago.

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